Félicitations

If you were to be contacted by someone called Harlem Désir, which profession would you assume he or she followed?

Nope, not that. It is M. Désir and he is the new leader of the ruling French Socialist Party, the first coloured party leader in Europe.

Hong Kong

This week elections took place in Hong Kong. Only 40 of the 70 seats were on offer (the others are voted by special interest groups chosen by a neighbouring power) and the democrats managed to take 27 of them. This is enough for a blocking minority.

The election is following attempts by the Chinese to hold indoctrination classes in the schools (now abandoned) and you would have thought democrats would have done better.

In the run-up to the handover in 1997 soundings were taken about democracy and about going it alone (it is only the New Territories which were on lease from China: Hong Kong itself was British until we handed it over). But hardly anyone was interested. The majority didn't much like democracy, thinking it a distraction from making money. It seems they're still not enthusiastic.

A good week

It's been a good week for the euro. Yesterday the Bundesverfassungsgericht, the German Constitutional Court, ruled that it was not unconstitutional to go ahead with the ESM rescue fund. And today we learn that the party of Dutch Prime Minister Mark Rutte, an ally of Angela Merkel, is the largest after the election, gaining 41 seats out of 150, against 39 for the centre-left.

The rumours in Holland were that the Far Right party of Geert Wilders, which had turned its fire from immigration to Europe, and the Far Left anti-bailout party, would form a serious bloc. In the end the voters went for centre-right and centre-left. Polls showed that there was popular discontent with the bailouts but rocking the boat was too much for the Dutch.

Of the Constitutional Court decision, one of the German papers said it was a bad day for Eurosceptics. This is to misunderstand. Eurosceptics do not want financial disaster in Europe - it will benefit no-one. It comes as neither a surprise nor a setback that the ESM is regarded as legal rather than otherwise. I only point out that it is not necessarily a good thing.

The Court's full judgment contains a few caveats: Germany's liablity is capped at 27% of €700 billion which means the fund cannot be increased without the approval of parliament (and if they have blown all that, MPs are going to ask where it has gone before stocking the fund up with more).

The ESM cannot get a banking licence and borrow more from the ECB. This may be important, and is something Italy's Mario Monti described as crucial. It does not have 'unlimited firepower'.

And of course the idea of joint liability for Europe's debts, by way of eurobonds or anything else, is dead in the water.

So if Spain applies for help. and this tips Italy into proffering the begging bowl, €700 billion, of which €200 billion has already been blown, may not be enough: Germany can't lend Italy more money to pay its share of the bailout of Spain and vice versa.

The markets will look closely at this, and look at the terms which will be applied to any bailouts. They will wonder if these limits are worth testing.

Strange days

Belgium was invented in 1830 in a post-Napoleonic reorganisation of the continent, to act as a buffer between the UK, France and Germany. It is almost inseparably divided into two peoples and two languages and is the butt of several jokes (although the list of famous Belgians is longer than you might think). The most likely outcome for it is to become two separate regions of the EU.

The idea that anyone, as a free decision, should decide to take Belgian nationality, is an extraordinary one, but that is what Bernard Arnault, Europe's richest man, has decided to do. He is worth around €40bn, and France, the country of his nationality, where he was born and bred, has just imposed a 75% tax on incomes over €1 million. To put this into perspective, if he expects a modest return of 2% p.a. on his fortune, a tax increase from 50% to 75%  would involve paying an extra €200 million in tax.

Will all this now go to the happy Belgian tax collector? My guess is Arnault will relocate to Monaco, where there is no tax but French citizens are not allowed to take advantage of it.

It is a lesson for M. Hollande. The rich are flexible and do not like to be seen as something to be milked at will. It is a lesson other countries should learn as well.

The Draghi Put

It has a mysterious, rather sinister sound: perhaps a remote Indian shanty town, where 19th century British Soldiers were earmarked for murder in the Mutiny by a chapati being left on their doorsteps.

It is in fact an option - no perhaps just a boast - to shore up the weaker Eurozone economies with money created by the European Central Bank.

Mario Draghi is the President of the ECB and today is his 65th birthday.

I am not sure he has much to celebrate, though. First Angela Merkel put her oar in, insisting that countries in receipt of this largesse first apply to one or both of the bailout schemes (the EFSF and the ESM) and conditions will be attached to their rescue. Then last week Jens Weidmann, head of the Bundesbank, threatened to resign if there were limitless credit on offer (it is, of course, the Germans who have to pay).

The ESM has not been fully ratified yet (the German Constitutional Court has not yet spoken) and Spain and Italy, fearful of conditions being applied to them, have not applied for help.

So right now Draghi's promise to do everything in his power to save the euro just looks like whistling in the dark

'I will do such things - what they are, yet I know not: but they shall be the terrors of the earth!'
(King Lear)

Princess by another name

A doubly comforting tale reaches us from Wales, where the Duchess of Cambridge (Kate Middleton as was, and I still don't understand why she isn't a princess, being married to a prince) tried to buy a wetsuit. She asked if she could reserve it and the man in the shop asked for her name, which she gave as Mrs. Cambridge. Strange name, he said (everyone in those parts is called Jones, Jenkins or Price).

This blog salutes a man who, confronted with one of the most photographed women in the world, has no idea who she is; and we salute the Duchess, who is now so integrated into the Royal Family that she went out not realising she had neither money nor credit card.

Class

Alex Salmond, of the Scottish National Party, declares a couple of years ago that he intends to pursue full independence and that he will hold a referendum. The politicians huff and puff but the Royal Family, saying nothing, holds a Royal Wedding, Diamond Jubilee celebrations and plays host at the Olympic Games.

Quietly, Scottish independence has gone off the boil.

As they say in cricket, form is temporary, class is permanent.

Election fever

Only 10 weeks to go in the US election campaign and can't you feel the excitement? Aren't you awed by the white heat of intelligent debate?

No.

We know who the candidates are but their respective parties don't, and have not yet adopted them. Romney has said Obama has divided the country, Obama has said he is a spoilt rich boy with weird religious beliefs (no, sorry, I made that up). But nothing has really happened.

Obviously both parties are waiting for the valuable endorsement of this blog but it will not be lightly given. We have doubts about Obama, who is clearly anti-British and seems (you can't be sure without rational debate and we haven't had any) to want to spend more money, whereas the US Government is already $14,000,000,000,000 in debt, about $120,000 per household. Doubtless it can easily be paid back and I am worrying about nothing.

Romney is a different matter. In fact he is different to almost everybody. I cannot ignore the fact that he thinks Christ visited America, and that he had his father in law, a convinced atheist, received into the Mormon Church after he had died.

Romney made a disastrous visit to Britain, in which he said we weren't ready for the Olympics (it seems we were); making a speech in the garden of No.10 he said he was pleased to be in the backside of Downing St (memo to Americans: in English English, backside means what you call ass).

Against that, he said he approved of the 'Special Relationship', saying it was an Anglo-Saxon thing, although I am longing to hear him explain this to the National Association for the Advancement of Coloured People. After Britain he went to Israel where his stance against Iran was well to the right of Benjamin Netanyahu.

It is early to come to a conclusion: it may turn out that both candidates are mad, in which case this blog will endorse the one that is loopy but harmless.

10 weeks of breakneck excitement lie ahead of us.

Weather madness

Whilst Britain has had the wettest summer on record, here we have had the driest. Britain had a month's rain falling in a single day. We had a brief shower yesterday, the first in 3 months, which reduced the temperature from 40C/104F to a balmy 28C/82F.

And we are only 1,000 miles away.

They should have held the Notting Hill Carnival in Umbria and broadcast it to those huge Olympic TV screens.

Party Funding: Cameron gets grubby

It's just a few rumours, a couple of well placed articles by friendly pundits, but it looks to me as if David Cameron, putting his ambition before his country, is about to let us down.

It concerns a boundary review. As a result of us all moving about, it now needs a lot fewer votes to elect a Labour MP (mainly in the towns) than a Conservative one (in the countryside). There has traditionally been a review of the constituencies every few years and it is quite legitimate, indeed in the country's interest, to try to get all the constituencies roughly the same size.

The trouble is that his coalition partners, the Liberal Democrats, reckon they will lose out and so will only agree if they get their way somewhere else.

Cameron's first act of grubbiness - no, it was an act of sabotage to the British Constitution - was to agree an insane system of electing the House of Lords. This was never going to fly; they proposed using the party list system, where the voters don't choose the candidate, they don't even know who it might be, but the party does. The election is detached from the electorate. Apart from that it would cause a democratic crisis: if the Lords (or Senate) disagreed with the Commons they could each say they had a democratic mandate. Incidentally the only way it would work would be to have adopted the system used in Germany, France, America and everywhere else, that the upper house are regional representatives and not elected on the same mandate as the lower house. For example, Wyoming, with just over half a million inhabitants gets the same number of senators (two) as California, with over 37 million. In Britain we could use the old county boundaries.

Anyway Cameron, who must have known he was promoting an antidemocratic nightmare, was thwarted by a mass rebellion of his own ranks (some politicians, at least, have a conscience).

Anyway, the rumour is that Cameron's next attempt to get his boundary review past his partners is to introduce state funding of parties. This would institutionalise the political parties: they would effectively cease to be arms of the people and become arms of the state. They would merge and demerge, not according to the beliefs of their supporters, but according to how much taxpayers' money they would attract. And it will be plenty: plenty of advisers, weasels, hangers-on and brown nosers, at least for the main parties. Jobs for the boys.

Let's consider here the position of the British National Party, a rather unpleasant group which not only wants to reduce immigration, but send some immigrants home. How would they fare?

The BNP have a fair bit of support round the country, in poor working areas. The first thing is that you wake up one morning to find you are funding these people: or at least the government has earmarked some of your taxes to give to them. A grinning subspecies on the television says that black people have different habits, and they're taking jobs and subsidised housing from white people. You can turn off the TV but you suddenly realise you are giving these offensive morons money to proselytise you with even more of this tosh.

And what can the Government do? Can they say that the funding will only go to nice people? That would mean the State was telling you how to think, telling you that you could only vote for people the State approved of: like the old East Germany. The BNP have a Euro MP and so will attract a fair bit of loot, and when the five or six other racist parties realise they can get some taxpayers' dosh by joining forces with the BNP, they will create a large, unpleasant, discriminatory bloc with more votes and more of your money.

All this Mr Cameron is prepared to sanction in order to achieve his ambition: a handful of grubby votes in return for letting his country go hang. In my opinion he doesn't have the moral character to hold high office.

Neil Armstrong

Neil Armstrong has died, aged 82.

My own view of astronauts, particularly the early ones, is that although they were test pilots and knew a bit about fear, this was fear of the complete unknown, they conquered it and that's what I call brave.

When Armstrong was alive, however, no one seemed to have a good word about him or his mission. He was supposed to have overruled the original plan in order to be first on the moon himself, when they had intended Buzz Aldrin to be. He was said to be self-righteous and difficult to work with.

As to the mission, it was believed, apart from the nutcases who still think it was filmed in a studio in the Nevada Desert (I met one of these not long ago, so they exist), that the mission was simply a part of the Cold War: that Russia having been first into Space, America had to achieve something visible and remarkable so billions of dollars were blown and astronauts' lives put at risk.

Whatever, it was a remarkable achievement and Neil Armstrong to some extent symbolised the American Century.

Cry God for Harry, England and St George

Tony Blair's chief media adviser used to say that if a negative story was on the front pages for ten days it was going to be a disaster.

I doubt the tale of Prince Harry and the strip billiards in Las Vegas will make it to this level, but to be honest I'm a bit surprised it has lasted as long as it has.

'Unmarried army officer in his late twenties parties in his hotel room with both men AND women!'. It's hardly a scoop, is it? Not even a headline.

Harry has a serious job, and had been through enough crap with the Olympics, where it seems his father, brother, grandmother, stepmother, uncles and aunts had declined to take any further part and he found himself representing Head Office and chaperoning his sister-in-law at the Closing Ceremony. He had been posted to America and had a night to let his hair down.

Americans are different, and, for example, unaware that etiquette dictates that when indulging in sex acts with the Royal Family, it is customary not to take photographs and sell them.

So, how have we dealt with this? Peter Oborne, writing the most precious article in the Telegraph I think I have ever read, even by his self-righteous standards, suggested that Harry had let down the monarchy, the country and his brother officers by..er..getting up to a bit of rumpy-pumpy while off-duty. Keith Vaz MP, whose taste for publicity exceeds that of Victoria Beckham, says that the Royal Protection officers (polite term for bodyguards) are there for the protection of the Prince's reputation as well as his safety (now, that's quite enough Tequila, your Royal Highness!), something I suspect to have been made up in front of the microphone, his mouth already open. And finally Prince Charles (more about whom later)is going to have a stern word with him, he has let it be known.

The males of the British Royal Family are not known for keeping their trousers buttoned up and his father led a fairly free life (not just with Camilla Parker Bowles), as did his grandfather, great uncle, great grandfather and many before (George V seems to have been the only faithful one but who knows?). And the difference with these is that they were all directly in line to the throne (the Duke of Edinburgh as consort) and married.

Harry is neither.

As to the British Army, it has rogered its way round every continent of the world and this sort of thing will greatly enhance Harry's status with his men. We're not pretending, are we, that a good officer would not play strip billiards? Please.

Harry does us a sterling service in reminding the world that the House of Windsor contains humans, not just the stuffed frogs who bonk in private and beg the newspapers not to mention it, calling their mistresses 'confidantes'.

As to Prince Charles giving him a talking to, I can only say with the gospel of St Matthew, 'By their fruits shall ye know them'.

As to the Press, one paper regarded the story (with the photos) as sufficiently in the public interest to publish. I think that is a legitimate point of view, although I don't agree with it. Many of them didn't publish because Prince Charles hypocritically begged them not to. That is not good journalism.

Let us now allow this one to drop.

A new species

Every so often, it has happened a couple of times this year alone, the world celebrates the discovery of a new species. And in this sense, perhaps only in this sense, we should celebrate the arrival on the world stage of Congressman Todd Akin.

Akin is an anti-abortion campaigner. He caused excitement when asked whether abortion should be permitted in the case of rape. Akin's considered view was that pregnancy wasn't a worry for a woman who had been raped because 'if it's a legitimate rape, the female body has ways to shut the whole thing down'.

The world waited breathless for this sage to expound on what was and wasn't 'legitimate rape' but his minders have put the jacket on him and taped over his mouth.

But I think it worth considering how a man can have got this far in life (he is 65 with a university degree), much of it in the public eye, be selected by party managers to an important national post and believe that when a woman is raped her body detects this and shuts down the reproductive system.

Are there any more like him?

Scott McKenzie R.I.P.

The voice of a generation. This was recorded 45 years ago

Julian Assange

There is something which not many people understand about Mr. Assange; that he is not, in fact, important. He is, however, very good at persuading the weak minded, which includes the government of the United Kingdom, that he is.

Now he has been allowed to make a public statement from the balcony of his refuge, an unfortunate habit of Mussolini in his years in power.

"We must use this moment to articulate the choice that is before the government of the United States of America.
"Will it return to and re-affirm the revolutionary values it was founded on?
"Or will it lurch off the precipice, dragging us all into a dangerous and oppressive world in which journalists fall silent under the fear of prosecution and citizens must whisper in the dark."

How they cheered! Self-important twerp.

As it happens, I am very much in favour of knowing more about how we are governed and Wikileaks has played a (very) small part in that: it showed us, for example, that the US thinks Mr. Cameron is lightweight, not real news. But I don't call this free speech. I call it receiving and passing on stolen property. Because however daft the Americans are to assert their rights over information they had themselves passed to 3 million people (one fifth the population of Ecuador), stolen was what it was.

Britain needs to deflate Mr. Assange by telling the Swedes it has done its best and withdrawing the police force (costing £50,000 a day), the Prime Minister telling the world to lighten up.

Pussy Riot

It is hard to know what to make of the Pussy Riot case, which has drawn such attention all over the world. Perhaps the only conclusion is that too much is being made of it.

The girls are possessed of a sincere dislike of Vladimir Putin, and formed their punk group when he emerged for a third term as president after an election which had been widely criticised.

In February the group performed a heavy metal 'prayer' to the Virgin to rid Russia of Mr. Putin; the performance took place without permission in Moscow Cathedral. Three of the girls were charged with hooliganism motivated by religious hatred and sentenced to two years in prison.

What would we have done here? There's no doubt it would be an offence to break into St. Paul's Cathedral and perform a noisy blasphemy (although with the wet, progressive British clergy it is by no means certain any effort would have been made to stop them); the sentence? A little harsh but I should have thought a period in jail would have been appropriate.

As a side-show, in a protest about the protest, the former chess champion Gary Kasparov has been arrested for biting a policeman, also a crime in the entire Western world.

So the girls have achieved their aim of maximum publicity (and then some) and the whole world now believes that Putin is an unpleasant dictator who stifles his political opponents.

Job done. Let's move on.

Jolly bad luck

Poor Csanad Szegedi, who is a Hungarian member of the European Parliament representing a Far Right party called Jobbik.

For some years now Szegedi has been making fiery anti-semitic speeches but has now found out that he is in fact Jewish. It's the sort of unlucky turn that could befall any nutcase.

Jobbik have asked him to resign his post on the grounds that he was confronted with the information in 2010 but tried to bribe people to keep quiet about it.

Szegedi says 'I think that what counts is not to know who is a pure race Hungarian, the important thing is the way one behaves as a Hungarian.'

I hadn't realised that hypocrisy meant you had to resign as an MEP; presumably we'll be losing quite a few more.

Ecuador at war?

Aside from the knowledge that it lies on the Equator, the only thoughts I have ever had about Ecuador have been that it seems a nice place, home to lots of turtles, which has got to be a good thing. Its constitution is the only one, I think I am correct, which recognises the 'rights of Nature'.

So it seems improbable that it would get into a row, almost a war, with a major military nation whose capital is a 15 hour flight from Guayaquil. But that's what seems to be happening.

The other nation is the United Kingdom.

Our story concerns the extraordinary life of Julian Assange, he of Wikileaks fame.

Assange is an Australian, currently resident in Britain (although both sides to the argument would rather he weren't). He is wanted in the USA for publishing a lot of 'secrets' which had already been disseminated to 3 million people. And he is wanted in Sweden under their extraordinary sexual laws, where unless you are using a condom with a spare in your sock, and have signed a prenuptial agreement, what you get up to with your girlfriend is rape.

He is not, as far as I know, wanted for any crime committed in the UK.

The UK wanted to extradite Mr. Assange to Sweden but he, apparently fearing that the Swedes would send him on to the USA, has taken refuge in the Ecuadorian Embassy in London.

Now the Ecuadorian Foreign Minister has said that he has received an official note from Britain saying the host country would storm the Embassy if they didn't release Assange to the Police.

Now I find this hard to believe, even from such a bunch of idiots as the Foreign Office (I have said before that it ought to be closed down in the public interest). But just in case this is what is on their minds, let me say this:

Stop it, you fools. Violating the sovereignty of a friendly nation to get hold of a weak minded self-publicist who didn't buy a condom in Sweden is utter, utter madness.

Today

India celebrates 65 years of independence today. I confess I get a frisson of delight when this massive nation votes: a living lesson to its Chinese neighbour.

Here in Italy it is Ferragosto or the Feast of the Assumption and everything closes down, or would do if it weren't already closed because it's August.

Robin El Hood

This blog's Silver Award for Economics goes to Juan Manuel Sanchez Gordillo, mayor of Marinaleda, Andalusia, Spain who has been stealing food from supermarkets.

You see, it's OK because as mayor he has immunity from prosecution.

He says he has been giving the food to the poor, a redistribution of wealth he feels should have been carried out by the government.

I love this.

Unfortunately in Britain the only person immune from prosecution is HM The Queen, but come to think of it she could go into the Bank of England and empty the Treasury's account, handing the money to poor people who have seen their taxes wasted. Go for it Ma'am!

Egypt

There is a theory in the media that nothing happens in the summer (although the First World War started at the end of July) but while we have been watching the Olympics, little bits of history have been taking place around us.

In Egypt President Mursi seems to have staged a brilliant coup, in retiring the two top generals from the semi-military government and replacing them with two more to his liking.

The problem for us in the West is that it is hard to know in exact terms who stands for what. When I last visited this subject I suggested that the tension between the army (SCAF) and the Muslim Brotherhood government might be a good thing: SCAF seems to be anti-Islamist but hasn't been elected, whereas Mursi's government has been elected but when all is said and done is to one extent or another Islamist.

It seems Mursi's démarche has altered this balance but we don't know how much. Until a parliament is sworn in (the last one was closed down by SCAF) reflecting minority interests such as Copts and women the West would do well to watch, quietly. Egypt seems to be considering major military operations against terrorists in Sinai. It may just be that one faction or another is on our side.

Olympics: how was it for you?

Let's begin with 'What was it?'

An obvious answer, do you think? A sporting competition. Citius Altius Fortius?

So why are women competing? Don't get me wrong, I've nothing against women competing but they are not as Fast, High or Strong as men, so what are they doing in a merely sporting contest? And the Paralympics: I mean who goes to see that? Well, they've sold 2 million tickets, and many millions more will watch it on television.

So, not just a sporting contest. It's a spectacle, of course, with its ceremonies, its beach volleyball, its synchronised swimming, but that's not the whole story, either. What are we to make of the opening ceremony or, again, the paralympics? It is said that London was awarded the Olympics because of its central message of promoting sport for everyone. It's a social statement.

So a sporting competition which gets people to watch in the age of short attention span by creating a spectacle and by promoting a quasi-political sense of inclusiveness. They don't tell you that in the publicity.

As to how it went, it was immeasurably better than I thought it would be. I feared disaster, either through terrorism or breakdown. The London transport system can barely cope on an average working day, but it worked well due to the usual travellers being advised to stay at home, a sort of 'Family Hold Back'. I resented the 'Olympics only' or Zil-lane on the roads but in the end the roads were empty and even the hugely important Jacques Rogge tried the Docklands Light Railway.

Of course mass crowds and billions of TV watchers are like a hyperactive baby and have to be entertained constantly. And, incredibly, the British, with a reputation for organisation close to Italy's, coped brilliantly. For a fortnight we were fed a never-ending diet of strange and familiar sports, colourful spectacle and shining happy people, as the song says (the band R.E.M. should have played at the closing ceremony).

I don't think my grumpy cynicism was misplaced, but I am delighted to see I was wrong. Lord Coe (will he now be Earl Coe?) organised the thing brilliantly, with help from massed volunteers and the British Army and Britain this morning can feel very, very pleased with itself.

It's not just the medals, because it isn't just a competition.

Olympics Report 6

There are, presumably, not many more medals to be won, since the closing ceremony is tonight.

To balance the opening ceremony, which amounted to a political statement from the metropolitan left-wing elite (people being forced off the land, welcoming immigrants, a health service), the closing ceremony will probably be a celebration of denationalised industries and a show of people buying their council houses from Mrs. Thatcher.

Don't hold your breath, though.

Unhappy anniversary

A little gloom, amidst all the euphoria. Today is the fifth anniversary of the financial crisis, when central banks perceived a dramatic fall in confidence and pumped money into the system to counteract it.

Since then it has mutated as a liquidity crisis, a banking crisis, a sovereign debt crisis and a eurozone crisis. Nothing has got better for the ordinary family, nor will it for another year or so.

Now, back to the games....

Olympics Report 5

After an unpromising start, the UK has surged up the medals tables. So often did we hear 'Bronze to Australia, Silver to France, Gold to....Team GB' that I could have been forgiven for thinking that 'Team GB' was the new name of my country; that Her Majesty, invigorated by her first film part, had signed an Order in Council for the new name, while our attention was elsewhere. She hasn't, of course, the good old place remaining the UK, not even Team UK.

I may however change my name to 'Team Tim Hedges' in the hope it makes me fitter.

Incidentally a stranger might also have thought that the National Anthem had changed to the music from 'Chariots of Fire'.

But a great success, nonetheless. Particular congratulations to all those who achieved medals in sports not involving sitting down, our usual comfort zone.

Talk is now turning to the Games' 'legacy': how this will turn young Brits to sport. I may be wrong but in my opinion the effect will be minimal. It is just as likely to turn them to watching TV during the day. More on this later.

Democracy nuisance

Italy's Prime Minister, Mario Monti, has been in the news lately, cooking up some new way for the Germans to pay everyone's debts. Here's an interesting little bon mot he let loose in passing:

"If governments allow themselves to be completely bound by the decisions of their parliaments without maintaining some room for manoeuvre in international negotiations, then a break up of Europe will be more likely than closer integration."

Bear in mind that Mr.Monti has not been elected. It reminds me of the Government official in the former East Germany who said 'the people have forfeited the trust of the state'.

Now Mr. Monti is an educated man, but I think he needs to read one more book. Something like 'The idiot's guide to democracy' should serve. It would tell him that governments do indeed need to be bound by the decisions of their parliaments. It's a nuisance, but there it is.

The sick list

Greece, yes. Portugal, yes. Ireland, yes. Spain has already had help for its banks and seems likely this weekend to apply for a full bailout and Cyprus has applied for assistance. Now Der Spiegel reports that Slovenia is next on the list (for information it is a country tacked on to the North East of Italy).

That's six countries out of seventeen.

The story of Shafilea

Pretty name, pretty girl. Shafilea Ahmed was born in Britain to parents born in Pakistan. She disappeared in 2003.

Today her father and mother have been convicted of her murder. Shafilea wanted to live a western girl's lifestyle with tight jeans, pop music and boyfriends. Her parents sent her to Pakistan, drugging her for the flight, and put her into the marriage process, where a number of grooms are offered. She refused to participate and drank bleach. Her mother at first refused to let her go to hospital. When she came back to England she continued to disobey her parents and they killed her, stuffing plastic bags into her mouth and punching her. They concealed the body and it is only on the evidence of her sister that a prosecution has been brought.

What the Ahmeds did was come to Britain, because life is better there than in Pakistan, accepting the benefits but refusing to accept the duties. They were against integration, wanting a British income and a Pakistani family. This is more than bad manners, it is an insult to their adopted country and a threat to good race relations which have been hard won.

I'd have jailed them just for that. I don't enjoy the noisier side of racism but I do believe that British people have a right to expect immigrants to adapt, or choose not to come.

How you regard family tradition as more important than the life of your child I just don't know.

MATT gets it right

Thanks to the Telegraph's MATT.

See my post 'How we got here' below.

InfraMario

Mario Draghi, head of the European Central Bank, is in the doghouse. I don't mean with the European Political Class (our picture shows him troughing at the taxpasyers' expense with Mariano Rajoy, Prime Minister of bankrupt Spain), but with the markets.

Draghi announced on Wednesday that 'We will do everything within our mandate to support the euro, and, believe me, it will be enough'. There were little coded references in his speech before the ECB meeting to the effect that they would start buying the bonds of Spain and Italy, to keep interest rates down. So, what would he announce and how would the markets react? Thursday was Draghi Day. He announced nothing. Clearly he was either whistling in the dark or trying to bounce the Germans into shelling out without conditions.

Our Saxon cousins were having none of it. Spain and Italy can, if they wish, apply for assistance from the Financial Stability Fund, but there would be conditions attached. After that they might let Draghi buy some bonds but it wasn't certain.

As of the moment, Spain refuses to apply for a bailout, nervous of what conditions would be applied. Mario Monti of Italy who was boasting that there would be a shield keeping Italian bond rates down, is also disappointed.

The European Bond Markets had their worst day on record. Shares collapsed, Spain and Italy are paying more for their debt.

Thanks Mario

How we got here

A perfectly ridiculous post by Julian Huppert MP on the Spectator's Coffee House blog (recommended, btw) tells us much about our economic predicament.

Mr Huppert writes about cycling, currently much in vogue following a successful Olympics, and whilst saying that cycling deaths are surprisingly low, wants us to DO MORE. For those of you who don't understand government-speak this means taking money by force from hard pressed taxpayers and blowing it on some self-satisfying project. 'If we are to make a diference', Huppert smugly opines, 'we need £100 million to be invested annually in our cycling infrastructure....Every city should have a cycling commissioner promoting and advising on cycle safety.'

There is so much wrong with this, and by extension with Mr. Huppert, that it has to be tackled head-on.

First thing, Julian, is we haven't got any money. Remember? The wallet is empty and our debts are far, far too high. Your idea is that having blown billions on the Olympic Games, when something becomes popular we should chuck even more at it. Maybe instead we should instruct our athletes, like the Chinese and Koreans, to lose.

The second thing is that Britain is already struggling under a bloated state, which is stifling enterprise and initiative and you want to make it bigger. There would be more state employees taken on to administer the £100 million, managers, assistants, secretaries, lots of people can make a fairly good living playing with this kind of lolly. Then the commissioners. You don't think, do you, that this can be done without a little help? You must know what these people are like, Julian; there will be assistant cycling commissioners, deputy assistant cycling commissioners, local initiatives with more government employees travelling down to see how they handle this in Ashton-under-Lyne or Penzance.

Stop it, you idiot. Britain has got itself into a bad state by us listening to social democrat nonsense like this. No more. Mr. Huppert, your time is up.

Lastly I cannot help mentioning that whilst cycling has experienced renewed popularity, the people who are actually going out on bikes are people who would otherwise have taken some other exercise. The 'renewed popularity' is largely with overweight Brits sitting on sofas watching Bradley Wiggins on the TV while sipping beer from cans and eating pizzas.

They will probably like your idea.

Gruezi

Swiss National Day today.

As well as making watches and chocolate and money, they do this:

Olympics Report 4

Britain's athletes are not having a good Olympics. There was too much speculation, even assumption, that we would get a gold in this sport, another in that. Counting chickens before they are hatched, and the gods of sport don't like it.

The poor performance seemed to me typified when I saw headlines that a schoolgirl from Plymouth had won gold in one of the swimming races. Unfortunately she only lived, went to school and trained in Plymouth: she was swimming for Lithuania.

Britain's gymnastic team were on for a silver medal but the Japanese complained that they had been judged harshly and their appeal was successful. I really think the Olympics should be about objective victory - faster, higher, stronger is the motto - and we should ditch those 'sports' which are just about looking pretty in the subjective assessment of judges who just might be regionally or nationally biased.

One example is Tom Daley. A good looking boy and popular with the crowds, his sport is perfectly ridiculous. Synchronised Diving! Away with it, together with any other 'sport' where the winner can't be objectively assessed. Mr Daley should try swimming.

A Tale of Two Headlines

Daily Telegraph: Bankers found to have rigged Libor rates face jail

Financial Times: Iran sentences bank fraudsters to death

You can imagine the left-wing press cheering on this robust approach to bank regulation but I can't see it working here.

Although....

Olympics Report 3

Apparently a set of keys to the stadium, formerly in the hands of the police, have been missing for a week. The news is being treated with equanimity, as the organisers say that security has not been breached. How they can say this unless they know where the keys are, I don't understand.

Now imagine how it would be in the press if the private security firm, G4S, had lost the keys.

Rebalancing Britain

Chancellor of the Exchequer George Osborne will have breathed a sigh of relief last week as Standard & Poor's confirmed the UK's AAA rating with stable outlook (although the other two main agencies have it with negative outlook).

Much remains to be done in Britain and, as with the rest of Europe, it is not just about tinkering with the money supply. Osborne himself has spoken about rebalancing Britain and there is work to do on three fronts.

The Industrial Mix
Britain is overly reliant on the financial services sector, which constitutes 10% of GDP compared with 8% in the USA and 4% in Germany. It supplies around 10% of the tax take. Britain has more, bigger banks, so when the credit crunch came we were hit harder.

However, there is nothing wrong with doing something well, and rather than reducing our activities in the financial services sector, the solution is to build up other sectors, by making it more attractive to invest in Britain.

Nor should we return to old fashioned industries. We cannot compete in shipbuilding, clothing (except high fashion) and several other industries. It is interesting to note what has happened in the car industry. Britain last year produced a record 1.3m cars, but the growth has only happened as cars got more sophisticated, with more electronic and high added value engineering. Aircraft engines, at which we excel, provide a similar example. Life Sciences, pharmaceuticals, high-tech computer chips, these are the things we should be encouraging, without of course the government picking winners; we have had enough of that in the past. The Government needs to create the environment necessary for people to invest in these areas; it will do that by reducing taxes and cutting regulation (including opting out of much of the European system of red tape).

Diversifying markets
Britain is far too closely linked to European markets, with which we do around half our trade. Europe is no longer the great hope for the West; it is a declining, decaying structure based on the values and politics of the previous century. Growth will be in the East, in the developing BRICS economies, Brazil, Russia, India, China, South Africa and in Africa generally.

North-South divide
Lastly, something will need to be done about the regions other than the South East. For a while I thought that the proposed high speed rail link would help, but we can't afford to take it even as far as Birmingham.

Shovelling money into projects chosen by the government, or worse the EU, doesn't help. It never has. Paying successful companies to set up factories in deprived areas doesn't work either.

The only solution I can see is for the government to move out of London and into the regions. This would save money since property prices are lower away from London and wages less. With modern communications including video conferencing there would be no need for anything except rare visits to London by any except the top personnel. And the devolved offices would draw industry towards them as London does now. If you are a defence contractor you want to be lobbying where the Ministry of Defence is (Cornwall would be good). The hapless G4S Olympic Security maestros need to be brown-nosing the Home Office in their new offices in Newcastle, and so on.

Unfortunately all this will never be achieved while the Conservative Party is in coalition with the Liberal Democrats. The Business Secretary John 'Vince' Cable is a 1970s style socialist who seems unable even to peer into the current century.

It will have to be done some time, though.

Olympics Report 2

The opening ceremony was the most astonishing and impressive event I have seen. There was music aplenty, humour (including an excellent cameo by Rowan Atkinson) and Her Majesty's acting debut as she greeted James Bond and then seemed to parachute out of a helicopter into the arena. She delivered her lines like a pro.

I thought the ceremony was a bit long and it had unfortunately been hijacked by the bien pensant left. In a panic to seem racially inclusive they even had a black Victorian mill owner, which would have been a surprise at the time; agricultural labourers were seen trudging unhappily towards appalling industrial towns whereas in fact they couldn't wait to get out of the countryside, where many were starving.

And then there was a long piece about the National Health Service. I am a great fan of Great Ormond St. Hospital for children and indeed have contributed to its appeals, but there was too much of it. As for 'NHS' being illuminated everywhere, while children bounced on beds and nurses danced, it was ridiculous. The reason Great Ormond St. Hospital has so many financial appeals is that the State funding system is unable to provide it with enough money so it has to appeal to the public. The British Health Service is a failure, and nothing short of a national disgrace. Many of the nations present have a better health service, by dint of theirs not being owned and operated by the state, and they do not treat it, as the British do, as a religion: hospitals where people die from diseases caught in the hospital make for a rather shabby god.

Apparently the Director, Danny Boyle, was personally responsible for this, it being a reflection of his political views. It is a tawdry reflection on socialism that the State took money from the people to put on a spectacular, advertising the right-on political beliefs of the literati minority.

It is a disgrace that Mr. Boyle was allowed to get away with this, and we deserve an answer from Lord Coe and the other comfortably paid advisers as to how he did.

The rest of the ceremony was good, though.

PS Why on earth is the principal language French? Who let them get away with that?

In the wrong order

In Britain a plumber has been jailed for 12 months for taking money in cash and not paying tax on it.

You may remember a rather silly remark recently from a Treasury minister called Gauke to the effect that paying plumbers in cash was immoral. Of course it was nonsense -  you are quite entitled to expect that the plumber pays his tax - but a criminal offence occurs when he doesn't pay the Revenue what it is due. The Revenue have taken the unusual step of publishing the guy's photo on line.

All right and proper. It's just that I can't help feeling it would have been better optically to have prosecuted a couple of rich people first, then got on to the poor ones.

Olympics Report

Part of an occasional reporting series, to show I'm not just a moaning minnie.

To the surprise of many of us, the Games got underway two days before the Opening Ceremony. This would be, you would have thought, for some minor sport, to get the crowded schedule over with. But it was with football, the most popular sport in the world. In the ladies matches, Britain won, as did North Korea, despite having withdrawn for a while when the organisers put the flag of South Korea on the TV screens.

The men's football is tonight, which should at least see the end of our lot.

David Cameron made a pretty speech for the not-the-opening-ceremony, and this, I think, is the right thing to do. He needs to associate himself as much as possible with this, and if he can, bring in George Osborne to claim that, having masterminded Bradley Wiggins' victory in the Tour de France, he will now be taking the credit for any other successes.

Despite warnings from this blog, Team GB has not yet changed its title to Team UK.

Fixing the blame

British GDP dropped 0.7% in the last quarter, the radio waves are filled with breastbeating and ill-informed analysis, and Lord Oakeshott, a backbench LibDem peer, has called for the Chancellor George Osborne to be replaced by Vince Cable.

In my view, Osborne is far from perfect, but probably the best of a bad lot, except for those like William Hague who would be much the same. What we really need is for the media to stop allowing politicians to get away with recommending solutions which involve more government spending. On this, Labour's Shadow Chancellor Ed Balls is like a stuck record. And he's wrong.

Britain already has a bloated state, which has been built up on  borrowings which have reached the level of insanity. Even though we have record low interest rates, we spend just under £50bn a year in interest. Even after the 'savage cuts', 'too far, too fast' as Mr. Balls would say, we are spending, in real terms, the same as in 2007/8.

Osborne's plan was this: if he could be the first European Finance Minister to make cuts he would get a reputation for prudence and he wouldn't need to cut so much. In fact, he's hardly cut at all: current spending, even in real terms, is higher than in 2008/9 or any previous year. As for what cuts there have been, Osborne wanted to make them as painless as possible, keeping the LibDems on board; and so instead of cutting current expenditure, he cut public investment, which at £26.6bn is around half what it was when they came to office.

So the Osborne strategy was minimal cuts, making savings with lower investment, relying on growth in the economy to drag us along. I said at the time that I thought it a mistaken policy, because we needed desperately to reduce the size of the State: we needed to cut much, much further, not on welfare, which would be impossible, but on the myriad other claims on the taxpayer's purse. What was certainly not wrong with the plan was cutting too much.

It started well, with 800,000 new private sector jobs, vastly outnumbering the couple of hundred thousand lost in the public sector. What Osborne was not anticipating was Europe.

When we joined the EEC we traded with the whole world, a relic of our once having been the world's premier maritime nation. After 1973, the EEC (now the EU) pursued a policy of 'Fortress Europe', putting tariffs on imports from abroad. In particular, in going along with this, we hurt the Commonwealth, the old Empire. After a while our principal trading partner, for imports as well as exports, was Europe, as the Eurofanatics had intended. Now Europe is in trouble - I once described our policies as 'holding on to the coat tails of a man falling back on top of you'. The Commonwealth, by contrast, is doing well, growing at a much faster rate, and that is where we need to redirect our energies. I shall deal with rebalancing of the economy in a later post this month.

What Osborne could not have guessed, and nor did anybody else, myself included, was the incredible dithering of Merkel, Sarkozy and the rest. When it was obvious, two and a half years ago, that Greece needed to leave the euro, instead of kicking them out in order to save the rest, they put tiny bandages on a massive wound and the problem is still ticking over to this day. In addition Spain is now going under, Italy not far behind, and even Germany has been threatened with a downgrade by the ratings agencies.

Europe, our main trading partner because of the insane British Foreign Office policy since 1975, is going under, and dragging Britain down with it. The reason is, as I have mentioned before, that the euro is a political manoeuvre - it  never had any basis in economics - and they are loathe to look like idiots in abandoning it. And the Eurofanatics aren't just in Brussels: the Foreign Office, which I believe should be closed in the public interest, is crawling with them.

Osborne could not have known that it would come to a mass European suicide - I, an ultra sceptic didn't guess they wold be so stupid - and cannot be blamed for it. But the result is that our export markets are depressed just when they were supposed to be showing the growth that would pull us out of the mire.

Osborne must make stronger cuts, and use the money saved to reduce taxes on people and on businesses, and he must steer the British economy away from the sinking ship across the channel.

Let's carry on with the same captain, only more determined to hold his course. 

Europe

I am indebted to Fabrizio Goria for this...

Bread and Circuses

I know I have hardly mentioned it, and I want to assure readers that I am aware of a major sporting contest taking place in the UK. I don't want to seem like that judge who didn't know who the Beatles were (a popular beat combo, m'lud).

But I remember remarking at the outset that the bidding process was a good contest in which to come second and I harbour my resentment to this day. It's just that the organisers are saying there's nothing we can do to change matters, we've got the Olympics, so let's stop whingeing and make the best of it.

Which is fair enough. But I don't think critics should be silenced, so just for the record....

I resent the fact that this has turned into a commercialised kitsch-fest. Andrew Rawnsley in the Observer said said that 'It is like stepping into a dystopian future in which Britain is run by a military junta headed by Ronald MacDonald.' I expect only some of the stories are true, like inspectors banning bagels in the five-ring symbol, but there is without doubt an unnecessary degree of control over people's behaviour in the name of commercialisation. Life in Britain is cheap and crappy enough without this invasion of commercial gauleiters.

I resent, at the same time, that this is costing the British taxpayer upwards of £10 billion (some say £20 billion) despite the heavy handed use of sponsorship. If there's going to be plenty of sponsorship it should be costing us nothing. This absurd expenditure comes at a time when the Chancellor's, and the trade unions', view of savage cuts is shaving a few hundred thousand off welfare. I discount David Cameron's suggestion that when you factor in the gains from the Olympics we are making a profit as daft at best, dishonest at worst.

I resent the fact that this is making Britain 'a showcase to the world'. It is going to show up a lot more than we might wish. If the G4S security scandal showed us anything, it is that our civil servants are incapable of writing commercial contracts, because they are too sheltered from the grubby facts of life. Of course G4S shouldn't get their £57 million management fee when they have drastically underperformed, but they will get it unless it is written in the contract. Equally it seems obvious that to save money they held off on recruitment until the last minute and we didn't monitor them.

Another aspect which will be showcased is our trade unions, with border staff and tube drivers striking at the last minute, in the latter case even after we bribed them not to. It was known even seven years ago that there was a new breed of disruptive left-wing union leaders and that alone should have shouted that we weren't competent to run the games. Now anyone who was thinking of investing in Britain who has seen this 'showcase' will know what the place is like.

I resent the fact that no one has highlighted the constitutional element of having the army on the streets. This is something we have tried to avoid these 300-odd years.

I resent the fact that people have been forced to have missile batteries on top of their homes.

I resent the fact that some of the roads we have paid for will be taken from us and allotted to the IOC nomenklatura.

And I resent the corrupt, cosseted IOC themselves. In my view they should have been arrested as soon as they got off the plane.

Having said that, On With the Show!

Bearing up

The horrifying events in Colorado, where a young man opened fire in a cinema, have led to mumblings, but no more than mumblings, about gun control. This is, after all, an election year. Even so, I should have thought some brave journalist might have asked Messrs. Romney and Obama whether they had had cause to reconsider their views on the subject.

In Britain the key date was 1997, also an election year, where, after a massacre in  school in Dunblane, the then Conservative government and opposition Labour Party were tripping over themselves to show they cared. Anything of this sort is likely to result in a curtailment of civil liberties and so it proved. Relatives of the bereaved formed the rather tweely named Snowdrop campaign and persuaded Tony Blair to ban all pistols (they were by now known as 'handguns') as soon as he became Prime Minister. In a way Blair's statement 'I don't think people should be allowed to own handguns' said it all: in his rush to show he cared he forgot that our system of government is not that you can do something if the State permits it, but that you can do anything you like unless the State forbids it.

This difference is extremely important. It means that it is not for us to show why we want a gun, but for him to show why we shouldn't have one.

In the end gun crime went up in Britain, and the British Olympic shooting team had to practise in France.

It is in America that this difference is spelled out. There is a specific right to 'bear' arms (although no concomitant right to 'bear' cigarettes, another thing which can damage your health, or to 'bear' an open bottle of beer in your car, even though you are not drinking from it).

A Texan once told me that he insisted on having a firearm in case National Government invaded his state. I don't know, perhaps we are all mad.

But the American system would appear to allow a little chipping away at this 'bearing' arms business. They might think - and a bold candidate might announce it as policy - that a young man should not be allowed such sophisticated weaponry, or to buy arms and ammunition over the internet.

But I don't reckon they will.

Do it standing up

What the British Health Scare Industry is going to make of the news that a sedentary lifestyle kills as many people as smoking, I don't know.

Perhaps they will ban sitting down at work or in public spaces; make it illegal to drive while sitting down when you have a child passenger; put health warnings on seats 'Sitting kills'.

My own take on the matter is that smoking kills even fewer people than sitting. So perhaps we can have an apology for the persecution of smokers.

Syria

The admission by the Syrian Government that a suicide bomber has killed both the Defence Minister and his deputy, who is Assad's brother-in-law, gives pause for thought.

One's first thought is to wonder if this conflict, for so long kept out of Damascus, may now be reaching its endgame. For myself, I don't think so - it may serve to make Assad's regime, now desperate, more dangerous.

The second thought is to wonder how it happened. They have plenty of people to choose from to guard top level meetings, and it must have been difficult for this one to have got through the security checks, equally difficult for him to be turned.

The next ting is to wonder, as I have before in these pages, what sort of people the 'Free Syrian Army' (who have claimed responsibility) are. We know what type of organisation usually uses suicide bombers.

Lastly there are the statements from passers-by, who say they heard no explosion and saw no broken windows. Has Assad had a disagreement with the Defence Staff, executed them (as Saddam Hussein used to do) and tried to persuade the world that it is insane terrorists from extremist Islamic groups who are trying to overthrow the regime?

Maybe we shall never know, but it is further evidence that, unless we do, we should not involve ourselves in this conflict.

Sicily

There is talk that Sicily is likely to default on its debts, and that Prime Minister Monti has written to the Governor who, confusingly, is called Lombardo, asking him to resign. Well, that should pay it all off, eh Mario?

So what is this? If the debt had been guaranteed by the Italian State it would be included in the national debt figures (which are high enough as it is, at a smidgen under €2 trillion). No, these are debts incurred by Sicily on its own. People, companies, have lent money to Sicily, expecting to get it back. How much is it? I bet we don't know to within 50%.

One forex magazine simply said 'Who collects a Sicilian debt?'

Good grief!

In, I think, the first time they have played together the two music giants Bruce Springsteen and Paul McCartney had the electricity turned off as they were playing in Hyde Park, London, because they had gone over the allotted time. One of the musicians said that if they had finished they would still have been off stage by 11pm.

It is incredible that we have still got these people, whose more-than-my-job's-worth attitude seems to have ruined a memorable occasion. Here, I think, is a good direction to point the expenditure cutbacks.

Oddly enough it is not the first time it has happened to McCartney, whose Beatles concert from the studio roof in 1969 was also stopped by police.

Le Quatorze juillet

Bastille Day today, and this blog's good wishes to our French friends, Les Grenouilles.

New President François Hollande will be leading the celebrations. At his inauguration the Heavens opened and the poor chap was soaked to the skin. Let's hope he fares better today, though showers are forecast in Paris.

Friday 13th

Friday 13th July, 1934  Hitler announces the completion of and his responsibility for the purge known as the Night of the Long Knives

Friday 13th July, 1962  British Prime Minister Harold MacMillan sacks seven members of his cabinet, in a move known as the Night of the Long Knives.

Friday 13th July, 2012  British Prime Minister David Cameron, in a move known as the Night of the Long Knives....nah, he hasn't the courage.

The Stones

50 today



When I was a kid, you were either Stones or Beatles. For me it was only Mick and Keef and the boys.

I hear they're rehearsing again....

Inglorious Twelfth

It's an old joke and I've probably told it before in these pages

Captain: We are about to land at Belfast Airport. For those of you adjusting your watches, put them back 300 years.

Today is 12th July, when Protestants in N.Ireland celebrate the Battle of the Boyne, a skirmish between a Dutch King of England and an Anglo-Scottish former King of England 322 years ago.

The modus operandi is for the Protestants to march past Catholic areas, taunting them, until the Catholics rush out and they all have a fight.

This year the Protestants say they have a secret plan to avoid casualties, but I can give them a better one: don't do it. Stay at home and behave like modern people.

Italy: and now...

The Financial Times reports that investors are already asking themselves what is likely to happen after Monti, who has said he will not stand in 2013.

And well they should: the PdL, the largest party, has been doing polling as to which leader would get them most votes. And it's not the current leader, Mr. Alfano......

Bonjour, mon petit

François Hollande has been in London on an official visit. Turns out the French have come up with another shorty. Although his election publicity puts him at 5cm taller than his predecessor (presumably without Sarko wearing his heels), he appears a little altitude-challenged.

There is a healthy rivalry between the two countries at these events, and as well as having a bodyguard of the Coldstream Guards, a regiment which fought at Waterloo and later occupied Paris, he was conducted conducted by the superb figure of Major James Coleby, against whom he looked like one of those children that footballers bring on to the pitch at the start of a match.

The French Press are claiming he was tricked and that Sarko would have avoided the encounter.

The House of Lords

As I write, the House of Commons is debating for the second day a bill to reform the House of Lords. There will be a vote tonight.

When I was born, there was only one sort of 'Lord'. A few families had the right to send their eldest member to parliament and when he died his son got the job / privilege. Then Life Peers were introduced (known to the hereditaries as 'day boys') and there was some sort of balance. Then Tony Blair, in a bid to 'reform' the second chamber, got rid of all but around 90 hereditaries, but replaced them, not with a new system, but with his own placemen.

With the system of hereditary peers, if you closed your eyes and crossed your fingers, you could almost see some sense in it. It never claimed to be democratic, you got what you were given, almost as if the Upper House had been chosen by God. Some were hard working and clever, others were stupid or feckless or both. A brilliant soldier could father a worthless fool, an idle good-for-nothing could father a brilliant lawyer.

It was indefensible after about 1850, but in some respects it worked.

The system introduced by Blair was the worst of all options. Whoever commanded the House of Commons could stuff the Lords with his cronies (Blair did).

So the thing needs changing.

I have no objection to an Upper House 80% elected and 20% appointed: the appointed ones could help the machinery of government work, introduce some specific talent like the Church or the Military and stop the thing being too political. And let me say I don't believe it would create some constitutional anomaly if both houses were elected: that they would both have the right to claim electoral legitimacy. Most other countries have two elected houses and they each know what they are there for.

But a word needs to be said about how they would be elected.

The proposed system, of 'party list' is the worst of all Proportional Representation versions. What happens is that you would vote for your party and the party would decide who was first on their list, second, etc. There would be no connection between the electorate and the person who got the position. We can't have this, particularly since the people have recently voted in a referendum against using some new system for elections. It means the political class would have an even greater grip over our country (you don't imagine anybody who spoke his mind would get the job, do you?), at a time when they are already too strong. Strangely enough, most of the media, in particular the BBC, accept PR as naturally fair, as if there could be no argument against it.

The peers need to be non-proportional (see the electoral legitimacy point above). I would suggest two per old county, so the Isle of Wight would get as many as Middlesex, and their job would be to speak up for their region. This is what happens in the USA and there is no reason why it wouldn't work for us. There would be a straight ballot and the two candidates with the most votes would be elected. This would keep the Upper House at under 150 which would be good.

This new bill is rushed and, with its PR element, the creature of the Liberal Democrats, who I had thought were supposed to be junior partners in the coalition. Mr Cameron has given into them for short term political advantage, playing with our constitution for his own narrow political gain. He should be ashamed of himself.

The people of Britain deserve a properly thought out amendment to their constitution and when we have got one, they deserve to vote on it.

The right result

The crowd ooh-ed and aah-ed, his pretty girlfriend cried and it looked as if the Duchess of Cambridge might too. Andy Murray, the first British men's singles finalist since anyone can remember, seemed to me to lose rather well.

And that is what we Brits like, isn't it? I was left wondering what we would have done if he'd won: applauded his Swiss opponent to the roof, suggested that maybe Federer deserved better and that our guy, whilst skilful, was a bit lucky? Let's face it we like a plucky loser and the audience seems to have taken the rather unloveable Mr Murray to its heart.

My favourite Murrayism:

Commentator: how difficult will it be for your parents watching you?

Murray: I'm not bothered, really. It's worse for me.

Gotta love him.

The Brits

As I write, England beat Australia at one-day cricket, a Brit was one of the winning men's doubles at Wimbledon, where a Brit will contest the men's singles final this afternoon, and a Brit, Bradley Wiggins wears the maillot jaune in the Tour de France. 

It probably augurs badly for the Olympics.

Eurozone: where we are now

Well, there's to be another summit, giving hope to the millions of people who...er...are interested. And Our Dear Leaders, conscious that the people want something new, are, this time, not having lunch. But dinner. I'm sure my readers will join me in hoping they get nice things to eat and drink. It will be in Brussels where both the chips and the chocolate are excellent.

Let's see what has been going on since the last success.

At the summit at the end of June, as we all know, there was a coup against Chancellor Merkel, orchestrated by Mr. Monti of Italy, which made the heir to Bismarck cave in on whether Spain's banks could borrow money rather than Europe giving lending it to the Spanish Government which would lend it on to the banks. Woo-hoo! Also the ECB would be able to invest, if that's the right term, in Spanish and Italian bonds.

Now we learn from an EU official that in fact the Spanish Government would have to guarantee these loans. What the official thought this guarantee was worth he didn't say.

In the meantime we hear from Finland that it has not agreed that the rescue funds should intervene on secondary markets, as Mr Monti said, and that it would not stay in the euro if it meant bailing out other countries (a bit late for that, I should have thought). Holland seems to agree, while Germany still hasn't even finalised the existence of the rescue fund.

Further south, you will remember that Greece elected a new government which was in favour of the bailouts in principle but would aim for gentle renegotiation. After the first meeting with  the Troika, the ECB, IMF and EU, the finance minister said they couldn't go for renegotiation since they hadn't fulfilled their previous promises (in fact they have hardly done anything towards fulfilling them). As I warned before, there is now likely to be widespread civil unrest, as Syriza-organised protest loses its patience with what can only be described as a bunch of liars.

Then Southern Cyprus, which has run out of cash. It is one of the three presidents of Europe, for the second half of this year, so at least there will be one vote in favour of bailing the blighters out. Christofias, the Prime Minister, has said they should receive generous treatment because all they did wrong was invest in Greek government bonds which were..er..worthless.

The markets were cock-a-hoop when they pulled off the last massive success, then enthusiasm declined and now Italy is paying more than 6% for its money and Spain is paying more than 7%.

I wonder what unanimous success story they can achieve on Monday night?

LIBOR (2)

Show me a judicial enquiry, or for that matter a Royal Commission, and I will show you a weak politician or a corrupt one. Jim Callaghan was the master of this, having hordes of lawyers and civil servants scribbling away on any issue he found difficult, confident in the knowledge that, by the time they reported, the issues would be forgotten by the public and Sunny Jim would be safe in the House of Lords.

In this case it was the Opposition which wanted a Judicial Enquiry, hoping by the time of the next election they would have got over the stigma in the public's mind of having brought the economy to its knees. The Government is right not to let this happen and, of course, is enjoying itself enormously.

Let's just deal with where the bankers come into this. I joined the City of London in the mid '70s and found the people simply normal. I never heard any of this 'my word is my bond' stuff: it was intended for stockjobbers, a now defunct breed, to the effect that if they agreed to sell you shares at 10p, they wouldn't subsequently sell them to someone else for 11p. It wasn't a morality statement, just a contract term. Closer to the City's working methods was a friend in an American bank, who said his employers' unofficial motto was 'If you can't kick a man when he's down, when the hell can you kick him?'

Normal people. If you leave a £50 note outside it will eventually disappear into someone's pocket. Normal. Unless, that is, it is watched night and day. That is what we call regulation.

When Gordon Brown became Chancellor he wanted to emaciate the Bank of England, which he didn't like, and set up a new tripartite system of regulation, involving the Bank, the Treasury and the new Financial Services Authority. It has been an unmitigated disaster. Nobody knew what anybody else was doing. In the case of the FSA, which also had to regulate the insurance policy on your fridge, it was either out of its depth or asleep on the job. Probably both.

So to those who want an enquiry into bankers' behaviour let me say this: The City employs some very intelligent and aggressive people. The reason they are always trying to make as much money for their banks as possible is that that is what they are paid to do, and the more they make for their employers the more they earn. There, glad I could help with that.

A couple of extra points. The way to stop people losing confidence in LIBOR is to base it on real trades: the quoting banks submit their last five trades and an average is picked, ignoring any obvious anomalies.

Secondly, is there much difference between fiddling the LIBOR quote downwards and Quantitative Easing, where interest rates are fiddled down by the government by printing more money and buying government debt?

Greeks bearing CVs

Having said just a week or so ago that he will 'roll out the red carpet' for French tax exiles, Mr. Cameron now 'vows' (did this take place in a church?) to protect Britain from Greeks fleeing their country's economic collapse.

Doubtless he hasn't a racist bone in his body (in fact I sometimes wonder if he has any bones in his body), and I shan't make my own preferences clear, but if this is the way he is thinking he should tell us which nationalities he likes and which he doesn't like, perhaps setting out his reasons.

Life and Liberty

It's the 4th July.

'We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty and the pursuit of Happiness.'

And while we are on the subject of Liberty, here's another quote 'I will close Guantànamo Bay' - B.Obama

There remain 120 people in Guantànamo who have had their liberty taken away without being charged with, much less convicted of, any offence.

Alice

Two anniversaries today. As for the more recent, it is 150 years ago that Charles Dodgson, a mathematics don at Oxford, together with a friend, took the three daughters of Dean Liddel for a boating trip (they'd probably be asked to sign the sex offenders register today). Over tea on the riverbank Dodgson invented and told a magical story which he undertook to write out for Alice, one of the girls, and published using his nom de plume Lewis Carroll.

And thus was born the European Union Alice's Adventures in Wonderland.

Cameron and the referendum

In Britain, David Cameron has been making a complete idiot of himself over the possibility of a vote on the EU. He was in favour, then he was against, now he seems to be back in favour. His own party are fed up, the opposition are calling it a 'shambles' (fair enough) and the people must be wondering what they've got which passes for a government. Cameron dithers until the moment when leadership is required, then vacillates.

My own position is clear. I came to the conclusion in 1991 - more than 20 yeas ago - that Britian would be better off both financially and democratically if it left the EU. Therefore what I want is for the government to stand up and say 'enough is enough. It is time for us to leave.' In view of the fact that there was a referendum in 1975, albeit over a different body, there may be a need for one now, for symmetry. But belief is required to make such a decision, and our Prime Minister has no beliefs at all.

But I am not on the side of the in/outers. A referendum is not a viable policy in itself. My side might lose it, if the Eurofanatics, amongst whiom we must include Cameron, persuade the public it is too risky to leave, and a small adjustment to the Fisheries Policy will be enough.

And Cameron doesn't want an in/out referendum any more than I do. What he wants is to renegotiate what we can and then put it to the people. I don't much object to this, except we are relying on Cameron to negotiate toughly (ha!) and not just say that some trivial change was the best he could do. His backbenchers must hold his feet to the fire, and produce a comprehensive shopping list of what he ought to achieve.

But the thing now is timing. Cameron will try to say that there is no need to do anything immediately, because a new Europe is emerging and we should wait and see how it turns out. He mustn't be allowed to get away with this: it is more vacillation. It may be that something new happens in Europe before the next British General Election, but it is unlikely to be anything in our interest: Merkel and Hollande and that funny little Belgian bloke aren't likely to say the future is a loose association of nation states based on free trade, are they? It will either be more Europe or, equally likely, more dithering and the same thing. We don't need to wait for that.

If they are to move towards more Europe they will need a new treaty (they may in any case need one for the latest accord to bail out Spanish banks) and as soon as this is mooted Cameron must be in there with his shopping list while he still has the threat of a veto. That is how to negotiate.

But I do wish it was anyone other than Cameron in charge of this.

Recovery

Those who are concerned that a country leaving the eurozone would face massive devaluation and subsequent implosion should remember Thailand.

The Asian financial crisis began 15 years ago today, and the Thai Baht rapidly lost half its value. Thailand started to grow again within a year and despite world slowdowns has grown at around 5% since then, doubling the size of its economy since the crash. It is predicted to grow at 5.5% this year and 7.5% next.

It can be done.

The Revoluciòn is back!

Congratulations to Enrique Pena Nieto, who appears to have won the Mexican Presidential Election, but without a strong popular mandate..

His party, which glorifies in the oxymoronic name 'the institutional party of revolution' (PRI) just about sums up the Mexican electorate: it's got to be racy (Revoluciòn!) but you never know with change (Institutional). The PRI ruled Mexico without interruption from 1929-2000 (institutional indeed) when they were voted out on charges of corruption.

Unfortunately the sorry lot which replaced them weren't much better and so institutional revolution is back with a..er..whimper.