What's our BATNA?

The Brextremists keep repeating "no deal is better than a bad deal", but by 'no deal' they mean falling back on WTO rules.

This is their BATNA - their Best Alternative to a Negotiated Agreement.

So is defaulting to the WTO better than a bad deal? Clearly from the point of view of trade any deal would have to be better than no deal.

Air travel? No deal means our aircraft will mostly be grounded, as they will not be allowed to enter other countries' airspace. Airlines are already planning for this pratfall. When people book flights departing post-Brexit there will be a notice explaining that no compensation will be paid if the flight is grounded. Thomas Cook has already added this condition to its post-Brexit holidays. Worryingly, the government's transport secretary said the issue could safely be ignored for "some considerable time". (Who ARE these people?)

What about our EU debts? This is where 'no deal' would appear to be a good deal. Just walk away from our financial responsibilities. Sadly, Brexit's success requires the UK to strike lots of advantageous trade agreements to make up for losing our preferential access to the largest single market in the world. Governments won't be over-eager to make deals with a brazen deadbeat.

At least immigration will go down - won't it? The Brexiteers promised us that. Well, err... I don't know how to break this to you... And don't even ask about Boris's £350 million for the NHS.

So the Brextremist BATNA is much worse than any deal. That's not all - the WTO option itself will need negotiation, so it is not even a real BATNA. A real falling-off-the-cliff, non-negotiated Brexit will mean our trade being strangled by punitive WTO duties.

Fortunately, Mrs May and Mr Hammond understand this and are doing their best to strike a deal. Unfortunately for the Brexit headbangers, the rest of the EU also understand this and will offer us a deal that suits them. Their BATNA is the UK crashing out and having to beg for crumbs from their table, which isn't much worse for them than a negotiated settlement.

We have a choice right now, we can accept that Brexit was unplanned, we have no road map, we have no competent driver, and there will be more nasty shocks coming. We need some breathing room, so we should pay up on our promises in return for transition time and for market access.

If the Brexiteer vision of free-trade Britain isn't just another of their marketing ploys then this is the obvious way to go. Pay now and reap the rewards later. The sums owed are tiny compared to the trade gains Leave promised.

The alternative is to thumb our nose as we jump over the cliff, then spend the next couple of decades picking up the pieces and trying to glue them back into some sort of economy.