Would a no-deal Brexit be a repeat of Black Wednesday for the Tories?

Could a no-deal Brexit destroy the Tory party’s reputation for competence and lead to a crushing electoral defeat in the same way as Britain’s withdrawal from the Exchange Rate Mechanism did in 1992? That is certainly the view of some seasoned commentators, such as Jeremy Warner in yesterday’s Daily Telegraph, and the parallels to an acrimonious Brexit seem obvious. But in reality, the comparison is actually misleading, as it misrepresents the political history of the ERM exit and fails to understand how Britain has changed as a result of the Brexit referendum.

First, it’s worth remembering that what really hurt the Conservatives after ‘Black Wednesday’ was not that government policy had been defeated by economic logic. Instead, the damage was done by the realisation that the initial Tory policy of ERM membership had inflicted a severe recession, a housing-market slump and a fiscal disaster – and very nearly a banking crisis – on the country.