Brexit chicken

In the famous 1955 film Rebel Without a Cause, James Dean and Corey Allen race stolen cars towards a cliff edge in the classic game of chicken, where the loser is the first driver to jump out of the car. By the standards of those days, this disqualified the loser from getting the girl (Natalie Wood, in this case). But things did not follow the game plan. James Dean jumped. But Corey Allen got his jacket caught, failed to jump out, and was carried to his death at the bottom of the cliff. This rendered him ineligible for the girl, so James Dean lucked out.

The European Commission has now adapted the rules of chicken to a Brexit context, and has invented the game of supervisory chicken. Both negotiating parties are careering toward the Article 50 cliff edge at high speed. Both know that, if they do not agree to some form of regulatory co-operation, they risk financial instability and consumer harm at the bottom of the cliff. But the Commission also believe that, the longer they hang on in the driving seat, the more business will relocate from London to the EU.

Well, in this Brexit game, the British authorities bailed in December.  Both PRA and FCA agreed to allow EU-based branches to be authorised for business in the UK, and to protect British consumers holding insurance contracts with EU providers. Sam Woods and Andrew Bailey are currently dusting down their leather jackets and straightening their quiffs.

Does this make them losers? Not in my book. The Commission T50 task force still have their foot on the floor and are gunning for the cliff edge, refusing to acknowledge any need for supervisory co-operation. There is of course a different ending – when the police come to investigate,  it will be European consumers who will be hurt, and European regulators who will be blamed. By then the Commission will be far from the scene of the crime.

There is still time for the Commission to jump.

A small aside about why our authorities find themselves playing this dumb game in the first place. James Dean asks the question why, and Corey Allen answers: “You got to do something, don’t you?”  Hence the Referendum.

Too young to remember Rebel Without a Cause?  No matter, the scene is recreated in 1984 film Footloose with stolen cars replaced by tractors crawling towards each other at 5mph, to the sound of Holding out for a Hero. In fact this may be a more apt parallel. The funereal pace and atmosphere of farce are both just like the Brexit negotiations. And the backing track aptly sums up our predicament.  

Too young to remember Footloose? Don’t worry. Rest assured that nobody would try anything so stupid nowadays.