Deal or no deal? A parliamentary Brexit vote and the two-level game

Publication of their general election manifestos in mid-May confirmed that the two main UK parties have different Brexit strategies. The Conservatives state that “no deal is better than a bad deal”, while Labour says that “leaving the EU with ‘no deal’ is the worst possible deal”, and promises that the party will “reject ‘no deal’ as a viable option”.

Both parties’ positions on this issue are consistent with the stances they have taken for some while. Labour’s opposition to ‘no deal’, as a leading policy objective, was only crystallised in a speech by Shadow Brexit Secretary Keir Starmer on 25 April, but it was foreshadowed in an address Starmer gave at Chatham House on 27 March, and by the positions taken by Labour parliamentarians throughout proceedings on the EU (Notification of Withdrawal) Bill from early February. Similarly, the Prime Minister announced the Conservatives’ ‘no deal is better than a bad deal’ stance in her Lancaster House speech on 17 January, and she and other ministers have reaffirmed it consistently since. Reflecting this difference between the two parties, the crux of the UK’s Brexit debate since Lancaster House has arguably been the credibility or otherwise of ‘no deal’ as a Brexit option.

The ‘two-level game’

‘Good deal or no deal’ and ‘any deal’ are the two alternative basic negotiating strategies identified by the US political scientist Robert Putnam in his famous metaphor of the ‘two-level game’. Putnam envisaged a national executive engaged in an international negotiation ‘playing’ on two levels simultaneously, the domestic and the international. Putnam suggested that an executive might manipulate her domestic conditions so as to strengthen her position internationally. In particular, Putnam highlighted what he called an executive’s domestic ‘win-set’ - the set of international deals capable of winning domestic support. Building on the work of the US economist Thomas Schelling, Putnam suggested that it could be an international negotiating advantage to have a smaller domestic win-set (as in, “I’d love to give you what you want, really, but Congress would never wear it”).

However, whether a smaller domestic win-set is a negotiating advantage depends on the negotiator’s strategy. Putnam identified two basic strategies:

• In Strategy A, the negotiator’s objective is a good deal or nothing. In other words, her order of preferences is 1. Good deal 2. No deal 3. Bad deal. In this case, the negotiator’s incentives are to shrink her domestic win-set and increase the credibility of the ‘no-deal’ option, so as to exert leverage in favour of a good deal.
• In Strategy B, the negotiator’s objective is any deal, rather than no deal. Her order of preferences is 1. Good deal 2. Bad deal 3. No deal. In this case, her incentive is to expand her domestic win-set, so as to increase her prospects of securing support for an agreement of any kind.

The General Election and a Brexit deal

Not least in their manifestos, the Conservatives have told us that they have Strategy A, and Labour that they have Strategy B.

Since the Prime Minister initiated the early General Election, most of the debate generated by (explicit or implicit) applications of the two-level game to the Brexit process has concerned the impact of the size and nature of the Conservatives’ likely parliamentary majority. Anand Menon (£) argued that winning a larger parliamentary majority would increase the Prime Minister’s ability to secure support for an EU exit agreement, and reduce the likelihood of a ‘no-deal’ Brexit. This would occur partly through a lessening in the parliamentary weight of ‘Eurosceptic’ Conservative backbenchers most likely to oppose an agreement. (The early election would make a Brexit agreement more likely also because there would be a longer gap between the government concluding any deal - presumably including UK concessions - in 2018/2019, and it having to face the electorate. The two-year-deadline factor is one of several ways in which Brexit idiosyncrasies complicate Putnam’s original, non-time-limited, picture.)

The problem for Menon’s analysis is that, if the Prime Minister aims to increase her ability to secure approval for a Brexit deal (by expanding her domestic win-set), this is at odds with the Conservatives’ declared ‘good deal or nothing’ strategy. Indeed, Menon’s point was to challenge the Prime Minister’s claim that winning a larger parliamentary majority would strengthen her negotiating hand with the EU as she pursues ‘the best deal for Britain’.

So, what is the Conservatives’ strategy?

The Conservatives and a parliamentary vote

A national executive playing the two-level game effectively might seek to manipulate not only the size of her domestic win-set but also the structure of the choices that domestic players will face.

In the case of Brexit, one such choice will be any parliamentary vote that is held at the end of the Article 50 negotiations. Conflict about the nature of such a vote ran through proceedings on the EU (Notification of Withdrawal) Bill in February and March. Neither the Conservative nor Labour manifesto added anything new on the issue.

In two respects, the government’s stance on a parliamentary Brexit vote fits with Strategy A (good deal or no deal). First, the government committed to holding a parliamentary vote on any exit deal. The government moved to announcing this position between the Prime Minister’s appearance at the Liaison Committee on 20 December and her Lancaster House speech a month later. In Putnam’s terms, the holding of such a vote represents the potentially helpful creation of a domestic constraint - a narrowing of the domestic win-set - on a good deal. In theory, the government can now say to its EU interlocutors that any deal has to be good enough to pass this hurdle.

Second, the government rejects holding a parliamentary vote explicitly to approve any proposed ‘no-deal’ outcome. In the shape of subsection (4) of the amendment moved successfully by the crossbencher Lord Pannick and Labour, Conservative and Liberal Democrat peers in the House of Lords, this is what the debates over a ‘meaningful vote’ came down to during passage of the EU (Notification of Withdrawal) Bill. In Putnam’s terms, the holding of such a vote would create a domestic constraint - that is, narrow the domestic win-set - on a ‘no-deal’ outcome. But, in this case, creating a domestic constraint does not generate negotiating leverage. (It makes no sense to envisage the Prime Minister saying to the EU, “give me a good ‘no-deal’, otherwise I can’t get ‘no-deal’ approved at home”.) Instead, holding a vote to approve a proposed ‘no-deal’ outcome would simply make ‘no deal’ less likely. In consequence, holding such a vote would reduce the credibility of the ‘no-deal’ option, and thus undermine the ‘good deal or no deal’ strategy. During proceedings on the EU (Notification of Withdrawal) Bill, Ministers and government supporters argued that holding a vote on ‘no deal’ would incentivise the EU to offer a ‘bad deal’, while making it impossible for the Prime Minister to walk away. This implies that the government would not expect the legislature to share its view that there is a deal so bad that ‘no deal’ is better. The government’s position is that if the Prime Minister were to decide not to conclude an exit deal, there would not be a parliamentary vote at all.

In at least two respects, then, the government’s stance on a parliamentary vote accords with the strategy of ‘good deal or no deal’.

In rejecting any alternative ways of structuring the vote, the government has said consistently that parliamentarians at the end of the Article 50 process will face a choice between any exit deal it negotiates, and Brexit with no deal. During passage of the EU (Notification of Withdrawal) Bill, the government and its supporters justified this position by pointing, correctly, to the uncertainty that would result for the Brexit process if a parliamentary vote against a government deal were to have any interpretation other than ‘Brexit without a deal’.

However, the government and its supporters also rejected amendments from opposition parliamentarians which were designed to reduce this uncertainty and open the way to possible alternative exit deals than the government’s. A parliamentary vote restructured in this way would tighten the domestic constraint on a good deal, in a way that ought to be helpful if the government were pursuing the ‘good deal or no deal’ strategy. (There is a difficulty for attempts to enable a parliamentary rejection of the government’s deal in favour of a ‘better’ one, however, inasmuch as they might rely on an extension of the Article 50 deadline - something UK parliamentarians on their own cannot guarantee.) The government’s preferred ‘this deal or no deal’ choice is what an executive would want if it were confident that the legislature would not, in fact, judge ‘no deal’ to be better than a bad deal. However, this would be consistent not with the government’s declared ‘good deal or no deal’ strategy, but with the alternative, ‘any deal’, strategy. And if the government is confident that Parliament would back any deal - however bad - rather than ‘no deal’, it is not clear why the EU would not make the same assumption.

The evidence from the Conservatives’ positions on a parliamentary Brexit vote, and their pursuit of a larger parliamentary majority, is thus that in Putnam’s terms the party is simultaneously pursuing both Strategy A (good deal or no deal) and Strategy B (any deal).

This might represent a sensible hedging position. But the peculiarities of Brexit raise another intriguing possibility. The Prime Minister justified her quest for an electoral mandate and larger parliamentary majority in terms not only of strengthening her position with the EU but also of easing the passage of Brexit-related legislation - most notably the Great Repeal Bill - in both Houses of Parliament. And the language of some government members and supporters has suggested that they see easy passage of the Great Repeal Bill and other Brexit legislation as increasing the credibility of the ‘no-deal’ option, by enabling the creation of a coherent, self-contained body of UK law ‘ready to go’ on Brexit Day without reference to the EU. In this case, possession of a larger parliamentary majority - a larger domestic win-set - would become an element in ‘good deal or no deal’ Strategy A, instead of - or as well as - an element in ‘any deal’ Strategy B. This would significantly modify Putnam’s original picture. And, in the effort to identify the Conservatives’ strategy, it would move more of the evidence into the Strategy A, ‘good deal or no deal’, column.

But Ian Dunt has now identified a new puzzle that again pulls matters in the other direction. Under the Salisbury Convention, the House of Lords does not reject at second reading any legislation passed by the House of Commons which implements a manifesto commitment. However, apart from the Great Repeal Bill, the Conservatives’ manifesto refers to only one piece of Brexit-related primary legislation (a trade bill), and not, for example, the customs or immigration bills flagged in the Great Repeal Bill White Paper. If the Conservatives are seeking to use the election to facilitate passage of Brexit-related legislation through the Lords (in the interests of increasing the credibility of the ‘no-deal’ option), this is odd. The omission could presage arguments with the Lords in the new Parliament as to the definition of a ‘manifesto commitment’ - must such a commitment be a specific bill, or could it simply be ‘delivering Brexit’?

Labour and a ‘meaningful vote’

Labour’s stance also exhibits elements of both of Putnam’s strategies. Rhetorically, as we have seen, the party rules out the ‘no deal’ option. This ought to mean that Labour supports a structuring of the parliamentary vote which maximises the prospects of the legislature approving any deal the government might reach. But, under the terms of its own rejection of ‘no deal’, Labour does not appear to regard a choice between ‘any deal’ and ‘no deal’ as a meaningful one. And the largest opposition party also wants to be able to … oppose. Indeed, the six tests which Starmer set out at Chatham House would oblige Labour to reject a UK-EU trade agreement on the government’s terms, because - as Starmer must know - no such deal could meet his test of delivering “the exact same benefits” as membership of the Single Market and Customs Union (as promised by Brexit Secretary David Davis). During proceedings on the EU (Notification of Withdrawal) Bill, Labour parliamentarians thus sought - through amendments - to restructure the parliamentary vote so as to create more political space in which to be able to vote against a government deal without backing a ‘no-deal’ Brexit by default. But, in Putnam’s terms, such amendments would have tightened the domestic constraint on a deal, and thus fitted more closely with the government’s ‘good deal’ strategy than Labour’s ‘any deal’ preference.

One way through the dilemma for Labour might be the distinction between a parliamentary vote on any EU exit deal, and a parliamentary vote on any UK-EU post-Brexit free trade agreement. Starmer’s tests appear to apply only to the latter (although the distinction could be complicated if any exit deal included transitional trade arrangements). And securing government agreement that the legislature would have a vote on both types of deal was part of Starmer’s campaign during passage of the EU (Notification of Withdrawal) Bill to secure a ‘meaningful vote’. This distinction might open the way for Labour to vote in favour of any government-negotiated exit deal (in order to avoid ‘no deal’) but then oppose any government-negotiated agreement on the post-Brexit UK-EU relationship (in order to adhere to the party’s six Brexit tests).

The Brexit vote and the new Parliament

Labour’s commitment, in Starmer’s 25 April speech and now in the manifesto, to “legislating to guarantee that Parliament has a truly meaningful vote on the final Brexit deal” is consistent with the efforts of its parliamentarians during passage of the EU (Notification of Withdrawal) Bill. But after all the proposed amendments to the Bill failed, Labour’s campaign for a ‘meaningful vote’ devolved to the motion put successfully to the Lords by Baroness Smith on 4 April calling for a “Joint Committee of Lords and Commons … to consider and report [by 31 October 2017] on the terms and options for any votes in Parliament on the outcome of the negotiations on the United Kingdom’s withdrawal from the European Union”. Such a motion cannot oblige the government to respond.

As matters stand, therefore, the new Parliament is set to face a vote on any Brexit deal on the government’s terms. Depending on one’s view, these terms are either strategically incoherent, or a clever combination which sustains the ‘no deal’ option while maximising the prospects of Parliament in fact voting to back any EU exit agreement the government might reach.

The underlying issue raised by this exploration of the two-level game and any final Brexit vote is whether the government should, in effect, be able to arrange a parliamentary vote as it chooses. Academic applications of Putnam’s framework have suggested that an executive’s attempts to use domestic constraints to gain international negotiating advantage are effective only where the foreign interlocutor knows that the constraint is genuine. From the perspective of the two-level game, therefore, the most interesting piece of Brexit (and post-Brexit) policy in parties’ manifestos so far might be Plaid Cymru’s demand that “all future free trade deals … must be endorsed by the National Assembly for Wales”. Wallonia, here we come?