As Parliament shows itself so far unwilling to find a compromise, Brexit watchers have spoken of the possibility of a snap general election. How that could turn out is anyone’s guess with Brexit throwing up unprecedented division among lawmakers and the public.
J.P. Morgan Economist Malcolm Barr noted that “the next day or so is likely to involve no small amount of finger pointing among those seeking either a ‘softer’ Brexit or a ‘People’s vote’.” A People’s Vote refers to a referendum on the Brexit deal on offer or revoking the whole departure process.
“We continue to think that a general election is the single most likely path forward in the coming weeks, even though that event raises a lot of questions for politicians on all sides,” Barr said in a note Monday evening.
“With the indicative votes process having come so close to identifying a ‘softer’ path tonight, it looks likely more bargaining and tweaks to the motions will generate a positive outturn on Wednesday. It is not clear to us how PM May can forestall that, and the potential split in her party that could follow.”
The EU’s Barnier signaled that the bloc could accept a customs union with the U.K. but noted that the only way to avoid a no-deal Brexit “will be through a positive majority in the House of Commons” (the lower house of Parliament) putting the ball back in the U.K.’s court.
Lutfey Siddiqi, visiting professor-in-practice at the London School of Economics, told CNBC he believed that a middle way would still be found.
“Parliament has no appetite for a no-deal Brexit or no Brexit … I can see a center of gravity emerging in Parliament where it’s towards a customs union perhaps with a confirmatory vote,” he told CNBC’s “Capital Connection” Tuesday.
“It’s a game of brinkmanship (with the EU). We’ve got these two cars hurtling towards each other but in the British car there’s a tussle going on both for the steering wheel and for the GPS navigation system. That makes it very hard to predict the exact sequence (of events).”
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