The Europe dilemma

It may be said to have started when Mr Cameron came up with the wheeze of allowing petitions with more than 100,000 signatures to be voted on by Parliament; they didn't have to have a vote and if they did it wouldn't be binding on the Government but you could guess some people scented some sort of possible victory.

If Mr Cameron hadn't realised, I think most people could have told him what the first two petitions would be: restoring the death penalty and leaving Europe. Whilst a majority of the people are in favour of both of these, a majority of parliamentarians are against them. They are two areas in which Parliament is out of synch with the people. Parliament decided not to vote on the hanging petition but to have a vote on Europe and that took place last night, the motion being that there should be a referendum on leaving.

For myself, I became certain around 20 years ago that Britain would be better off both financially and democratically if we left the EU. Financially, in part because of the amount we pay into it. Don't be fooled by people who say we should be talking about the net amount we pay in, net of what we get back. Currently the Government would like to apply what we get back towards reducing the deficit but the EU won't allow that. When we talk about income tax we don't say the net figure is zero because we get it back in schools, hospitals etc. The amount we give them is around £12.5 billion a year. The other financial cost is the stifling regulation introduced by the EU over the years, which reduces employment and tax revenues. Most industrialists say we would be better off leaving even the single market.

Democratically, we only have to see that more than 75% of our laws come from Europe, the majority of which we have no veto over.

So I might have been in favour of the motion last night, but my problem would have been that I don't much like referendums. The best thing to be is the guy who writes the question: if it had been 'Should we stay in the EU with all the democratic and financial costs that entails, or leave for a new life of freedom and let the blighters stew in their own juice?' it would have been favourable to my own side. What it would probably be is including a third option of renegotiation, which would catch the slightly undecided.

So a referendum might be lost.

When I blogged on the petitions on 8th August (also on 2nd October) I said 

Neither of these motions has the faintest chance of success and nor have any of the others. The political class is revolted by the idea of the country being run by popular outcry. But I think Cameron may have made a mistake in raising the hopes of the British people only to dash them

The result is that the vote was lost, but more than half Cameron's backbenchers disobeyed his petulant instruction to vote against. Now he has the worst of both worlds. He will try to resolve the situation by promising to renegotiate the terms of our membership, but neither the Conservative Party nor the people will trust him to do so.

His only viable way out is to put to the EU before the next treaty change the things he wants to opt out of, and make that list public. Then when they want to amend the Treaty and need our vote, he can simply refer them to that list.

Has he got the courage and integrity for this? Personally, I don't think so. Let's hope I am wrong.

PS I know there is a movement towards the Government issuing a White Paper on renegotiation, but this is quite wrong. We send the government into these negotiations (which usually come out for more integration) without the detailed approval of Parliament, and this is no different. Also Cameron would say it tied his hands (Nye Bevan's term 'sending them naked into the conference chamber' has already been bandied about). Cameron just needs to get the Tory party onside and call the Liberals' bluff.

Tunisian Elections

Today sees the first proper elections in Tunisia since the French were in charge.

This blog wishes the Tunisians well, and I must say I envy the feeling that one is taking part in something ground breaking.

Democracy, which we take for granted, can be an exciting thing.

Climate Change

Global Warming is back on the agenda, with a team from America saying their findings confirmed those made previously, that there was a trend for average temperatures to rise. Since the 1950s temperatures have risen by a bit less than 1deg C. This doesn't really address the issue, which is whether this was caused by man, and whether there is anything we can do about it. Just to put it into perspective I have two homes less than 200km apart and the temperature difference is usually 5 deg C.

Anyway the BBC has leaped on this, so here, in the interests of even-handedness, is the reaction by Marc Morano of Climate Depot:

The scientific reality is that on virtually every claim -- from A-Z -- the scientific case for man-made climate fears has collapsed.

The Antarctic sea ice extent has been at or near record extent in the past few summers, the Arctic has rebounded in recent years since the low point in 2007, polar bears are thriving, sea level is not showing acceleration and is actually dropping, Cholera and Malaria are failing to follow global warming predictions, Mount Kilimanjaro melt fears are being made a mockery by gains in snow cover, global temperatures have been holding steady for a decade or more, deaths due to extreme weather are radically declining, global tropical cyclone activity is near historic lows, the frequency of major US hurricanes has declined, the oceans are missing their predicted heat content content, big tornadoes have dramatically declined since the 1970s, droughts are not historically unusual nor caused by mankind, there is no evidence we are currently having unusual weather, scandals continue to rock the climate fear movement, the UN IPCC has been exposed as being a hotbed of environmental activists and scientists continue to dissent at a rapid pace.

PS you can read the evidence for each of these statements here

Of Mice and Men

'Mice overrun BBC newsroom' says the Telegraph.

Don't worry. The real problem is that the boardroom is full of mice.

News from the madhouse, 21st October

Want to know the solution to the Eurozone crisis? If I tell you, you'll keep it to yourself, not tell anyone else? Well it's this: more summits.

Or at least that's what the Eurozone leaders seem to think. The big summit is this weekend, where everything is going to be resolved and the problems made to disappear in a flash.

As I write it is Friday morning and already we have learned that nothing will be decided at the weekend but there will be another summit on Wednesday.

The intention was to solve three issues: the next bailout for Greece, the expansion of the European Financial Stability Facility and the recapitalisation of the European Banks. The three issues are connected and the French and Germans don't agree on any of them.

The markets have bought it, believing that Wednesday will certainly see a resolution of the leaders' differences. I wish I could be so sure.

A popular death

It's hard to find anyone today who is sorry about the death of Muammar Gaddafi, and with him gone it seems strange that, being so unpopular in his own country, he managed to rule it for so long. One of the great lessons that life teaches us is that you are never such a swell fellow as when you are on top, and never such a dreadful creature as when you are down.

Many are saying that his death opens up the way for the fledgling administration to bring into flower a new democratic era; it is to be hoped that in a year's time we are looking on a new member of the civilised world, co-operating with its neighbours and responsive to the needs of its people.

The other side of the coin is that Gaddafi's death removes the focus of the struggle: if Tripolitanians hated Cyrenaicans there was always someone they hated more. Until now. From today the politics of religion and the ancient tribal scores can bubble up freely. Let's hope they do so peaceably.

A word about the death. It appears that Gaddafi was captured alive, if wounded, and that at some stage someone walked up and put a bullet in his head. This blog does not approve of unnecessary or political execution but I must say if I had been a leader of the NTC I would have instructed the nearest general to do exactly that. The last thing that is going to help Libya is Gaddafi spending years preparing his defence in the bogus and ineffective International Criminal Court and having the world's media listening as he denounced the new regime. Gaddafi was a soldier and now they can say he died a soldier's death and draw a line under the matter.

Occupy!

What most people are saying about the Occupy Wall St / the City demonstrations (I hope to deal with the Italian ones, where there has been serious violence, later on) is that they lack focus. Some of the demonstrators don’t seem to like this policy, some don’t like that one. I think it is fairly universal that they believe that some people are doing quite well and some (a considerably larger number) are doing very badly, but that is hardly news. There seems no credible leitmotif to the protests.

Some are saying there should be another tax on bankers’ bonuses, something I disagree with, and some say there should be a Robin Hood tax (which I also disagree with), although these are viable (if wrong) positions to take. But most people have just turned up there with a grumble.

In fact I rather tend  to agree with the unfocussed majority. It is the job of governments to create the conditions where people can find work and prosper, and in that at the moment they can’t, there would seem to be an outright failure of, if not the political system, at least of the last few people in charge of it. My view is not that you personally have a right to a job, but that we have a right that there should be jobs on offer.

If I were to focus my rage, I should take into account that many countries did not feel the recession of 2008 (Australian and Canada spring to mind, but there were others) but some, by contrast, felt it a lot more than the rest. The guilty men? This has probably been done too often but I give you:

Bill Clinton, who insisted that Freddie Mac and Fannie Mae, the mortgage reinsurance arms of the Federal Government, both symbols of the 1950s and quite unnecessary now, reinsure mortgages for anyone who wanted one: there were unemployed people in the South taking out mortgages with no hope whatsoever of repaying them, and these became part of packages which were rated Triple-A but which had no chance of being either serviced or repaid and caused the collapse. Another is Gordon Brown of the UK who, in the words of a more apt commentator than I, ‘mistook a credit bubble for his own genius.’ Perhaps we should include Angela Merkel and Nicholas Sarkozy whose indecisiveness has ensured that a large part of the 400-odd million people they lead are scarcely solvent.

In Italy, where the riots have been more serious, it has to be remembered that Berlusconi and his mates have been in power from 2001-2006 and from May 2008 until the present day. Even less has been done in Italy to address the country’s problems than in any other country (I suppose we must exclude N.Korea and Zimbabwe). This is not, however, a justification of the violence: it seems clear that a minority have used the demonstrations for an anarchistic crack at ‘The System’. Again, perhaps, it symbolises the unfocussed nature of the complaints, but violence isn’t necessary or forgivable. In fact it gives political leaders the chance to dismiss all the grievances as coming from thugs, without addressing the unviolent majority, as they should.

In a way, I should like these complaints to be focussed (not around the Tobin Tax, please, it’s just what my grandmother would have called cutting off your nose to spite your face), because the people really do have a grievance. But really, I regard it as just part of the economic cycle. A regrettable one. Let’s hope it gets better next year.

Silvio survives

I must say I didn't expect any other result than Silvio Berlusconi surviving the vote of confidence, having lost the vote on the budget. Firstly, Berlusca is a canny operator, secondly he has obtained a surprising amount of loyalty from his colleagues and partners and lastly nobody wants an election right now.

The position remains precarious, however, and this is not good for Italy. His government rests on a knife-edge, and the smallest whim could bring it down: the dogs are sniffing defeat but still nervous to jump in for the kill.

The FT, naively, says that Italy must make reforms and that ideally this would be done by a centre-right government. Let's be blunt: they are not going to be done at all by a left-wing government. The only hope of modernisers is that a new centre-right champion emerges (and right now he would still have to be endorsed by Berlusconi).

Many people seem to think that the President can simply appoint a government of national unity. That is not the case: there would have to be a vote of no confidence lost, then elections which failed to win a majority, then the Presidential appointment for a limited term. It is too much of a gamble. Bossi has proved weak: he should have detached himself from Berlusconi at the peak of his party's influence; instead he has held on too long and looks like going down with the ship.

Italy is in a political, as well as economic, mess. Let's hope for the best, even though we don't know quite what that is. The Italians have been naive, and have avoided difficult decisions, but they deserve better than this.

The Ukraine, for better or worse

The fact that Yulia Tymoshenko looks like a member of an Abba tribute band does not make her innocent. Nor of course does it make her guilty.

The former Prime Minister of the Ukraine, and former executive in the gas industry, has been sentenced to 7 years in prison and a fine of around £120 million; which seems on the stiff side. Her crime was to exceed her powers as Prime Minister in negotiating a gas deal with the Soviet Union. Many think it was a politically motivated sentence.

Not very much will be done to help her, because the West is concerned that the Ukraine might drift politically towards Russia rather than towards us, and we can't afford to upset them. She won't serve her full sentence but for the moment will be put on the back burner.

Shooting the Fox

Andrew Werrity is a curiously Dickensian name: perhaps the honest son of a poor family who learns that he has been cheated of his inheritance from a wealthy uncle.

He is indeed cast in a drama, however it is a modern day one. He is the friend of the Defence Secretary Liam Fox, who has been so much in the news. Werrity has been on something like a third of Fox's foreign trips and has appeared in meetings with him with various foreign dignitaries even though he is not a civil servant nor a special adviser.

It is not enough, now, for Mr.Fox to say that there has been a witch hunt against him. It is quite right and proper that the press investigate what could be a security leak: the Defence Secretary doesn't just discuss the weather with foreign governments and Mr Werrity has no security clearance. Nor is it sufficient for Mr. Fox to apologise for blurring the distinction between public and private life: he is the defence secretary.

There were whispers before, and these have grown since it was reported that at the time of a burglary to his flat, there was another man staying there, that Mr. Fox might be having a homosexual relationship. Nothing wrong with that if it is in the public domain but not if he is trying to cover it up (the Tory Party first said he was alone in the flat). At first we heard that Fox and Werrity met at university, then we are told that there is 16 years' difference in their ages and when they met Fox was on a speaking engagement at the university.

But then again what sort of man makes his homosexual lover best man at his wedding (to a woman)? It is all very curious.

Fox either needs to resign and maintain the privacy an ordinary individual is entitled to, or he needs to make a full explanation, covering, but not limited to, the security implications. Nothing in between, one or the other. He owes it to his wife and family, he owes it to Mr Werrity, and above all he owes it to his country.

More trouble for the Eurozone

Slovakia has voted down the proposal to increase the size and powers of the European Financial Stability Fund. Just to recap on the history here, this increase is part of the 'agreement'  of 21st July. In this case 'agreement' means that it had been agreed by France and Germany. The other Eurozone states have since ratified it, as they were told to.

Of course the world has moved on since 21st July and no one is now pretending that the amount of the proposed increase (to €440bn) is enough: consensus is that to work it needs to be €2 or perhaps even €3 trillion. But now even the €440bn has been voted down.

This whole sorry story is illustrative of the structural problems of the Eurozone. When it was formed many of us warned that as well as being unable to weather a crisis for financial reasons, the decision making procedure was too unwieldy. As a result the Eurozone moved towards an oligarchy of People Who Matter (France and Germany with occasional references to their mates like Holland and Luxembourg), and when these two brought the tablets down from the mountain the others would be expected to toe the line.

Three problems here: one is that you could hardly pick a worse pair of ditherers than Angela Merkel and Nicolas Sarkozy. Second, the twin Moses figures do not have corresponding interests and rarely agree, the latest sticking point being that France wants to be bailed out by the EFSF while Germany says it is for crisis-hit nations only.

The last point is that this bullying is genuinely resented by the smaller nations. Franco Frattini, the excellent foreign minister of Italy, has recently voiced his disapproval. Smaller nations, like Slovakia, scarcely dare do that. Instead, the European ship, as it so often has, founders on the rock of democracy. The Euro-elite hate democracy but they are stuck with it, and countries like Slovakia, which only achieved democracy after the collapse of the Soviet Union, are some of the keenest exponents.

The principal mover of this Slovakian démarche is Richard Sulik, head of the Freedom and Solidarity Party, and a member of the Government. Here is what he said:

'A few years back, we survived an economic crisis. With great effort and tough reforms, we put it behind us. Today, Slovakia has the lowest average salaries in the euro zone. How am I supposed to explain to people that they are going to have to pay a higher value-added tax (VAT) so that Greeks can get pensions three times as high as the ones in Slovakia?'

Seems fairly sensible. Greece is richer per capita than Slovakia, with the Slovakian average wage being roughly equivalent to the Greek minimum wage.

Sulik also pointed out that to meet their obligations under the EFSF the average German would have to work 120 hours more, whereas to meet their obligations the average Slovak would have to work another 300 hours. That's more than an extra hour per working day to help out people richer than them.

Take a step back and think what the average person would have done to mitigate such a disaster. It's insurance, no? You insure your house so that when the roof falls off the money is ready to rebuild it. The EFSF might have worked as an insurance policy, set up from the start. But they couldn't do that because it would have looked as if there was the possibility of failure.

Now, failure is upon them.

What will happen? I would guess the Slovaks will be told to vote again until they get the right answer, but it will cause delays - the government seems to have fallen - and even then it is to approve something everyone knows is insufficient to do the job it was designed to do.

It is not impossible that the incompetence and wilful blindness of the Euro-elite, its insistence on a political dream which was obviously impossible, will now bring the entire world financial system crashing down. As a monument to stubbornness, stupidity and blind obedience to the diktats of an unelected elite, the Euro will be looked on by later generations as ours looked on the memorials to the fallen in the First World War: with shuddering incomprehension.

News from the Madhouse (Oct 10th)

While Italy can't agree on who should fill the job of German Ambassador Central Bank Governor, things are warming up elsewhere.

Dexia, a bank specialising in local government finance, formed of a heady mixture of a French nationalised bank and a Belgian one, has had to be rescued for the second time in three years. The problem, as I mentioned a month ago, is it invested in Greek Government debt. Dexia passed its European Banking stress test just a while back: the stress test didn't include European Sovereign Default, even though they all knew it was likely to happen. The authorities didn't want anyone to fail, you see.

The bailout is likely to push Belgian Government debt up to Italian levels.

Meanwhile France and Germany have had another summit. they announced afterwards that they had agreed on a solution to the Eurozone crisis, to the recession, to Greece and to Angela Merkel's ingrowing toenail but..... but they aren't going to tell us what it is for 3 weeks. This means, if I may translate for you, that they haven't agreed at all. France faces such a bill for bailing out its banks because of their loans to Greece that it wants the Financial Stability fund to do it (ie Germany to help pay) whilst the Germans think it should be for emergencies only, and that the French taxpayer should cough up.

Now, next Monday's European summit will be put back for a week while they think of something to say.

Eventually the markets will get fed up with this and start shorting the euro, and the French will say that everything would have been all right if it hadn't been for the evil Anglo-Sasson speculators.

The bigger picture

It is scarcely believable, but amidst all the trouble Italy is in, amidst all the suspicion of investors that the country is out of control, the Government ineffectual, there is no agreement on the new head of the Central Bank.

Mario Draghi, the outgoing head, who takes up his position as head of the European Central Bank in less than a month, favours his former number two, Fabrizio Saccomanni, as does Berlusconi. Giulio Tremonti, the finance minister, by contrast, favours Vittorio Grilli, head of the Treasury. Berlusconi's main coalition ally, Umberto Bossi, whom we must suppose to be mad, favours Grilli, on the grounds that he is from Milan whilst Saccomanni is from Rome. Tremonti is from Pavia, also in the north.

The whole lot of them must be so insulated from reality that they cannot see what this is doing. Italy is bust, the euro is crumbling, and they, like early Christian popes arguing abstruse religions points, cannot turn their faces to the big picture. It really is lamentable. Italy doesn't deserve this crew.

The reason it doesn't matter who gets the job is that he will be told what to do by Brussels and Frankfurt, who were responsible for the last budget.

I don't know if the job pays well, but I was born in Windsor, if that's any help, and can read instructions in German.

Hypocrisy (No. 5,621)

The appalling John Major, who was Prime Minister of Britain between 1990 and 1997 and ushered in the Maastricht Treaty, allowing the creation of the antidemocratic Leviathan that is the European Union and forcing Britain to be subjugated to unelected bureaucrats, has spoken on the subject of Europe. He says, now, that Britain should renegotiate its membership with the EU.

God love us.

This, coming from the man who got us into this mess, who called any realist a 'Bastard', makes me sick to my stomach. The ghastly old fool should either embrace a well deserved obscurity or apologise for the dreadful mess he got us into.

This amounts to one of the most nauseating pieces of hypocrisy I have encountered in my lifetime (amidst stiff competition). Major did more damage to Britain than Hitler even intended. He deserves public vilification, not an airing in the press which pretends he is a statesman.

Showing the world some fight

In his closing address to the Tory Party Conference the Prime Minister urged us to 'show some fight'. I suppose he was trying to sound Churchillian - most politicians do when they are in trouble.

Most people, however, will be left wondering how they are to fight. Whom are they to fight against?

This blog offers some answers.

Despite the Government agreeing with almost every commentator in the world that public spending should be reduced, it has gone up by £23 billion since Mr Cameron came to office and is scheduled to go up another £20 billion next year. Show some fight, Dave.

Most of the immigrants to Britain are from EU countries, yet despite blethering on about controlling immigration the Prime Minister makes no effort to stop it. Show some fight, Dave.

British industry is choking under levels of regulation its competitors worldwide do not have, in particular the latest ruinously expensive Part-time Workers Directive. Yet Mr Cameron did not refuse to implement it. Show some fight, Dave.

Most of the people who voted for him have been traduced by his undemocratic deal with the Liberal Democrats (the policies were made after we had voted) because he didn't have the balls either to go it alone as the largest party or to call another election. Show some fight, Dave.

Next time the Prime Minister feels like behaving like a man, much less a Churchill, this blog remains at his disposal for advice.

Graham Dilley

Sorry also to hear of the death of Graham Dilley, England fast bowler, often best known for his batting supporting Ian Botham's massive solo effort against Australia in 1981. Less known is his involvement here:

Bert Jansch RIP

I regret to record the death of Bert Jansch. Best known for his work with Pentangle in the 1970s the guitar virtuoso had an important solo career. Aged 67, he was performing until recently

Those ratings

I wrote about this a while back but as Moody's downgrades Italy by three notches I think it worthwhile revisiting the ratings and what they mean. The various levels are as below, in the format Moody's / S& P, Fitch (Standard and Poor's and Fitch use the same system) and for ease of reference I am giving just the ratings for long-term debt

Aaa / AAA

Aa1 / AA+
Aa2 / AA
Aa3 / AA-

A1   / A+
A2   / A
A3   / A-

Baa1/ BBB+
Baa2/ BBB
Baa3/ BBB-

It is easiest to see this in terms of four divisions. Prime is Aaa / AAA (Triple A). This is the level risk perceived to be almost non-existent, so, for example, companies investing your life savings would have a fair proportion (it varies) in this category. It pays the least. The USA has been downgraded from this level by S&P, but not by the other two. There are 10 European countries at this level: 3 Scandinavians, Denmark, Germany, Holland, Switzerland, Austria, France, Britain.

The next three, the 'Double A' categories, are high grade investments. They include countries such as Spain and Belgium, and high grade companies.

Then the 'Single A' categories, which include Poland, Czech Republic and of course now Italy.

Anything below Baa3 / BBB- is not regarded as investment grade and is therefore seen as a speculative investment.

Moody's has downgraded Italy's long-term debt to A2, in line with S&P's downgrade last month. so it is nothing new. Also on the plus side are that there are four categories further to fall while remaining investment grade. Against that, all the agencies expect Italy's rating to fall.

So it's not a surprise, but it's really not good news. 

An American

Just who are the Americans, and, come to think of it, we, fighting? In a post on 8th April 2010 I mentioned that President Obama had sentenced an Anwar al-Awlaki, an American citizen, to death. Mr Awlaki has not been convicted of any crime nor indeed faced any trial. I observed that if George Bush had done this there would have been outrage among the bien-pensant liberal left.

Now Mr Awlaki has been killed, as I predicted, by an unmanned Predator drone.

Ironically Awlaki, unlike Schwarzenegger or Kissinger, was born in the USA and so could have stood for President. And this would have been the best thing for him: a large security detail protecting him and, let's face it, the competition isn't exactly hot, he'd probably have won.

But I would like to know: which of its citizens is the US President allowed to execute without trial and which is he not allowed to?

Can you get a fair trial in Italy?

As the whole world knows, Amanda Knox has been acquitted of the murder of Meredith Kercher (so was her boyfriend Raffaele Sollecito but he doesn't get as much airtime). There are lessons to be learned from this and I want first to refer to the justice system in Britain, which has its faults but seems to me inherently fairer.

'Chief Superintendent X said he was unable to answer questions about the alleged crime, for fear of prejudicing an ongoing enquiry'. You've heard it hundreds of times, and in particular that word 'alleged'; newspapers are prevented from printing what they believe to be the facts in advance of the trial. The reasoning is simple: it might prejudice the minds of the jury if they read a lot of irrelevant or unsubstantiated opinion, and thus the accused would not get a fair trial.

Italy has no such qualms.

Let us take the only case(s) with an even higher profile than that of Amanda Knox: those relating to Silvio Berlusconi. His latest trial, for fraud, involved quite a bit of 'phone tapping. From this emerged all manner of details of his private life, quite irrelevant to the fraud case, which have been plastered all over the newspapers. How did they get hold of what was supposed to be court evidence? The police and prosecuting authorities sold it to the newspapers.

And this went on with the Knox / Sollecito case as well. Even before the trial began we were treated to a barrage of comments about her: that she was manipulative, that she took drugs, that she was getting the sort of sex ordinary Perugians don't get (except with the ubiquitous prostitutes). None of this was relevant except as a means to poison the minds of the jury, and it is to the credit of the 2 magistrates and 6 lay people that they eventually freed her.

There were other issues as well, of course: the knife, which had Knox and Sollecito's DNA on it (they had been using it for cooking) was claimed also to have Meredith Kercher's DNA but it turned out there was no evidence for that. When one commentator said that there was no evidence that Sollecito and Kercher were even there, and that 'someone would have to pay for this' suddenly her bra clasp appeared in the bedroom. And finally it emerged that the chief investigator had been convicted of fabricating evidence in another high profile murder case but was appealing the verdict and therefore not suspended: his employment rights were more important than Amanda Knox's liberty.

Shortly before their first conviction I heard a Perugian say that they would be found guilty at the first trial, because the good citizens wanted a quick result, preferably with a foreigner (and a manipulative, drug-taking, sex-enjoying foreigner at that!) but that she would be released on appeal because there was insufficient evidence and because the Perugians didn't want such a high profile prisoner.

And so it has turned out to be.

To paraphrase Marcellus, 'Something is rotten in the State of Italy'.

The Tories at play

The Conservative Party Conference begins tomorrow, although there has been so much discussion and leaking in advance that there scarcely seems any point in holding it.

What Conservative supporters and indeed the bulk of its MPs want is a referendum on staying in the EU. Mr Cameron disingenuously said we had already had one (in 1975) but that was of course for remaining in the European Community, which, relatively speaking, was fairly harmless.

However Mr Cameron held out the prospect of discussing it in Parliament, by inviting petitions. I discussed this on 8th August, finishing

'Neither of these motions has the faintest chance of success and nor have any of the others. The political class is revolted by the idea of the country being run by popular outcry. But I think Cameron may have made a mistake in raising the hopes of the British people only to dash them.'

(the other motion was for capital punishment)

It now seems that Mr Cameron's sop to the Eurosceptics in his party is to be in favour of the abolition of the Human Rights Act, which at least would be a short step towards Britain becoming a self-governing democracy. Let's see if he delivers: Cameron seems more and more one of the modern political class, slightly disgusted by the idea of the people running the country.

If I were a betting man, I'd put money on him cheating us out of that, too.

 

 

 

News from the madhouse

Greece has not submitted its 2010 budgetary figures to the EU because, according to Andreas Georgiou, head of Elstat, the National Statistics Agency, they can’t get into the building due to a strike.

According to various polls, 50% of Germans wanted the Deutsche Mark back, whilst 40% were sceptical about Germany’s EU membership.

48% of Austrians believe the Single currency has not been beneficial.

While the crisis is going on Mr Barroso wants just the Eurozone to operate a financial transaction tax, presumably to make sure there are no banks left after the crisis, and in 2012 the European Space Agency will present plans and seek funding for a moon landing. Please send your suggestions to them as to who should be chosen.

Happy birthday Silvio

Today is Silvio Berlusconi's 75th birthday.

One of Silvio's less than endearing habits is to slip into a bill before parliament some clause designed to help him personally. I am surprised none of his opponents has tried to recommend quietly a 'retirement at 75' clause for senior public figures.

No one wants an election right now (except for the electorate, of course), so the old boy will struggle on for a bit more.

The Tobin Tax

One of the strangest things about the proposed European Transaction Tax is the wishy-washy reaction of the British Government.

The transaction tax is supported by members of the general public and many politicians who have never held down a proper job, largely on the basis that it is a tiny percentage - 0.1%. What harm could that do? Mr Barroso, one of the three presidents of Europe, is of course in favour. He says it could raise €55 billion a year. Got to be magic, hasn't it? 0.1% and €55 billion.

The position of the UK Treasury apparently is that it would be all right if everybody imposed the tax. There is some reasonableness to this: but New York, Zurich and Singapore are not going to impose it. They're not that stupid, seeing a wonderful opportunity here to break the dominance of London.

At whatever level a transaction tax is going to raise the costs of borrowing and reduce the liquidity in the market, things we really don't need right now. And the Treasury should be aware, and be making the point, that 80% of this would fall on London. It is quite easy if you are France or Italy, with no capital markets to speak of, to support the introduction of a tax on Les Anglo-Sassons.

Mr Osborne, the Chancellor, belatedly in my view, has said he will veto the tax. He shouldn't have let the debate get so far: the answer right from the start should have been not 'maybe', not 'we can talk about this' but simply 'NO'.

The new Manichaeism

The other day some Republican commentator described President Obama as the Antichrist.

In the Amanda Knox case in Perugia, the prosecuting counsel described her thus: 'She was a diabolical, satanic, demonic she-devil. She was muddy on the outside and dirty on the inside. She has two souls, the one you see before you and the other.'

Does this medieval language stem from the fact that we see so much detail these days that we have to distil everything into a concentrated form? Is this a new Manichaeism deriving from a surfeit of internet facts and TV soap-operas, so that everything has to be unbelievably good or unbelievably bad, God or the Devil, for us to understand it?

Are we losing our ability to be shocked, so like a drug addict we need an ever stronger dose?

Obama is not the Antichrist, Amanda Knox is not a she-devil. That doesn't make them necessarily good people, just people like us.

PS translation by The Guardian, spelling by me, character size by Google

The king with no clothes

I suppose it is inevitable that the trial of Michael Jackson's doctor should be televised, but I think it is unfortunate. In the news reports you can sense the prurient voyeurism. You wonder whether the people, his fans, wanted him to live a normal life, wanted him indeed to live, or whether they prefer it this way. It seems to have been the latter but now he is dead there are regrets. Did they have to publish a photo of his corpse? Was this the prurience or a lawyer's trick to shock?

And you can sense the desire for a guilty verdict. People don't want to think of their hero as a weak minded, drug dependent automaton who could be got on stage with the right cocktail. So he must have been killed.

I suppose for many this must be compulsive viewing. For me it is repulsive. Michael Jackson allowed himself to be pushed into an ever more artificial life. He was killed by his fans.

A crisis of leadership

Bankers are impatient souls. I know, I worked for what was then a very conservative bank for a decade, and we liked things decided - plenty of caution and deliberation in the decision, of course - but decided, so we knew how to act.

As I have remarked before, the markets are tolerant of the Eurozone, believing it will all come out OK in the end, but this tolerance is beginning to fade.

There was a meeting, if you remember, on July 21st, where the whole damn thing was going to be settled. Now two months later, it still isn't. A greatly delayed decision to give the Greeks another €8bn has still not been approved. Just to put things in perspective, Greece's funding needs over the next three years were forecast at the time of the July meeting to be €172bn (yes, that's a bit more than an eighth of the British economy) over the next three years. Now it would seem to be more. How much more? They haven't a clue.

I seem to remember writing recently that the only people who don't understand that Greece is going to default are the people who matter.

So in the next couple of weeks (no hurry, chaps, don't shorten your lunch) someone will put a figure on how much Greece needs. Clue: it won't be less than the €172 bn thought of before. And then they will start the decision making about what to do. I know, it seems scarcely credible, but that's how it works.

Rumours were pretty heavily spread that the bailout fund would be increased to €2 trillion, but the Spanish finance minister (a possible beneficiary) has said no one has suggested that.

Er..just a tip chaps, if I'm not interrupting lunch or dinner, but the markets were hoping for a bit of leadership. No? OK, then, no. Fair enough, we don't want the political elite to panic.

That's fast

There was a young lady called Bright
Who could travel faster than light.
She went out one day,
In a relative way,
And came back the previous night.

I have just a suspicion that the discovery in Gran Sasso, Italy, of a particle exceeding the speed of light, should be taken with a nanogramme of salt. It was probably a FIAT jumping a red light.

Statistic of the week

Before this benighted global warming stellite fell to earth, NASA said it had a 1 in 3,200 chance of killing someone.

Now I live near a town of more than 3,200 people, so.....

By the way we are now likley to be hit by a German telescope falling out of the sky. Much more of this and I shall be statistically likely to be a goner.

A step backwards

Italian magistrates have demanded the arrest of Marco Milanese, a deputy of the ruling party and principal adviser to Finance Minister Giulio Tremonti, who is accused of corrupt practices.

Unfortunately Mr Milanese cannot be arrested without the approval of Parliament, and the Majority have voted against releasing him to be tried.

I have written before that the Italian people are losing faith in their governing class, La Casta, and this is going to exacerbate the matter even further. Demonstrators outside the Parliament building wanted to know why he should be treated differently to the rest of the population.

This really has got to stop. Italy desperately needs a new revolution - it had thought Berlusconi was one - and corruption, underperformance and overly generous remuneration amongst deputies needs to be ended. Berlusconi has made a serious mistake here: if the people have no confidence in their rulers they will get rid of them.

A satellite falls

The Americans have no idea where their satellite is going to fall - they gave some co-ordinates but it turns out they cover almost the entire inhabited portion of the planet.

We now learn that the satellite was there to monitor global warming. So, not content with telling you life as you know it was about to end, the damn thing might land on your head.

According to the Telegraph: 'NASA has warned people not to touch the debris if they come across it because it is likely to have sharp edges.'

I should have thought sharp edges were the least of the problems you might encounter.

What's in a name?

The FT's Brussels blog asks why there is no nickname for the euro, like a buck for a dollar or a quid for a pound.

What about calling it after the ECB President: a trichet?

In French tricher is to cheat; tricher avec les chiffres is to doctor the figures.

Troy Davis

We cannot, of course, know for certain whether Troy Davis was the man who killed Police officer Mark McPhail, but his appeals were turned down at every stage, including the final one to the Supreme Court, last night. All but a handful of American States have the death penalty and Davis was executed..

However the crime was committed in 1989 and Davis was convicted in 1991. He has spent 20 years, from age 22 to age 42 knowing that his life was at the disposal of the Justice System. Twenty years. I should have thought that was a 'cruel and unusual punishment' as the Eighth Amendment calls it.

Palestine

Mahmoud Abbas, otherwise known as Abu Mazen, Prime Minister of Palestine, is to present a petition to the UN asking to be a recognised state.

I can't help thinking this will do nothing for the people he represents, but plenty for him.

It cannot succeed, in the present form, at least. Everyone believes in a two state solution to the problem, but it must come through negotiation. The Americans, and the British if Cameron has any courage, will veto it. Other Arab countries will vote in favour, but none of Palestine's neighbours, such as Syria or Egypt can do anything practical to help: they have too much going on within their own borders. In any case Arab countries have traditionally shown a reluctance to get involved.

And whom does Abbas speak for? Gaza, supposedly a part of Palestine, is ruled by his opponents, Hamas. If Palestine were to become a member of the UN, it would be a country without borders - the demarcation lines are, at best, in dispute. And for there to be a land bridge between Gaza and East Jerusalem, the consent of the Israelis would be required. A solution as in Northern Ireland where each country recognises the other's independent existence through its constitution would exclude Gaza.

Abbas must know all this, and thus the only possible conclusion is that he is pursuing statehood in order to bolster his own position, at the expense of peace among his people.

This demarche is the last thing Palestine needs.

DSK down and out

Dominique Strauss-Kahn has admitted on French television that his liaison with a chambermaid in New York was 'une faute morale', and that he will not be able to challenge for the Presidency.

Presumably he will have done some private polling and concluded that what with a few other little 'fautes' pursuing him, even the tolerant French electorate will not put up with it all. He will be 68 at the time of the next election and that is probably too old.

DSK's big advantage, of course, was that he wasn't Nicolas Sarkozy. But strangely, his troubles rather obscured his policies. Had he stood, it would have been a case of whether you could put up with all the baggage or whether you couldn't, not whether you liked his policies.

In fact DSK is an old fashioned corporate socialist. He likes big government, plenty of interference, and mistrusts free trade. Pretty well exactly what France doesn't need now.

Who will benefit from all this? Sarkozy, of course, who should have an easy run into a second term (barring disasters) and Marine Le Pen, who is likely to beat one of the lacklustre socialist candidates to become the contender.

Passport to anonymity

The UK Passport Agency is considering allowing people not to enter their gender on their passport application, in order not to offend 'transgender' people.

One's gender is, like it or not, part of the identification procedure. It seems an invitation to Muslim terrorists to appear in a burqa, saying they are female.

I should like passports not to contain a photograph, lest it upset ugly people.

Danish Democracy

Denmark has had elections. I have a nice picture of the Danish flag, which due to the incompetence of Google I am unable to show you. Anyhow it is a white cross a little left of centre on a red background.

The election result is difficult so follow me carefully here.

The largest party in the Folketing (parliament), which had a slight increase in its support, will no longer form the government. That will be done by Helle Thorning-Schmidt, whose party, the Social Democrats, had their worst result for 100 years. Such are the vagaries of the proportional representation system, which the poor loves fondly believe is democracy. Still nobody knows exactly what government policy is, because they are in a huddle working out their coalition. Anyway, Ms Thorning-Schmidt is what they have got.

Known as Gucci Helle for her posh clothing, Ms T-S is the daughter-in-law of Neil Kinnock, the former British Labour leader, whose nickname was ‘the Welsh Windbag’. Her solution to Denmark’s problems, quite original given what is going on in Europe, is more government spending.

Poor Denmark.

Italy's budget

Those who were listening to BBC Radio Solent at 7am UK time this morning (OK, not that many, I admit), could have heard my dulcet tones explaining what is going on in Italy.

There was a small riot outside the Parliament building as they passed the budget; at least it was small by Roman standards. Some imaginative soul threw a pig's heart (although the Corriere della Sera says it was a veal heart: I think we should be told; an end to cover-ups!) but otherwise not much. The savings to be made, which are about double those being made in the UK, are, to a large extent agreed by Italians. They are persuaded, in my view correctly, that without these savings Italy would not be able to stay in the euro.

I think it important to think a little about the Italian psyche here, and it applies to the budget and to the Berlusconi case which is warming up nicely (more later). The Italians are not a nation of economists and they are not a nation of puritans. What is of great concern to Italy is the way the world sees it, its bella figura. They believe they must be a part of the euro not for some technical reasons - anyone who knows the least bit of the mechanics of the thing thinks they are mad to stay in - but because they want to retain a seat at the top table. Equally Berlusconi can get up to whatever he pleases until it  gets to the point that he is bringing down Italy (and I believe it may be getting to that point now).

So, there must be savings and there will be suffering. What the disagreement is about, and it is shared by the left and by the Confederation of Industry and by the ordinary people, is that it is too much in the way of taxes and not enough in the way of cuts. In fact, of the €54 billion in the budget, around two thirds is increased taxes and one third is cuts. VAT goes up by 1% immediately.

The reasons for the mistrust of the balance of this manovra are twofold: firstly, as Emma Marcegaglia of Confindustria says tirelessly, Italy's problem is lack of growth. Italy needs government expenditure cuts - in many areas the State chokes out private enterprise - it needs a sell off of State owned assets which amount to many billions and are only there as pieces on the political chessboard, and it needs an overall reduction in day to day costs of the State, a reduction in payroll and a general reduction in activity.

The other side of the argument, held by the left and by the ordinary folk, is that Italy needs to tackle its vested interests. In many ways the budget is targeted at ordinary people and leaves the rich off the hook. A VAT increase hits a family trying to clothe its children, it does not hit the rich and powerful, who don't pay much in the way of income tax either.

This blog agrees with both views: the budget should have been 75% cuts and sell-offs and efficiency drives, and the remaining 25% could have been covered easily by making the ruling class pay its taxes. Many people think they might have done well to copy Mr Cameron and be seen to reduce the costs and numbers of MPs. Vested interests again, and there's no one with the balls to tackle them.

Waking up the dreamers

An astonished euro supporter, that is to say a supporter both of the single currency and of the rest of the ‘Project’ asks what has gone wrong. Sometimes I try to see this in terms of human nature.

There is a certain sort of person who believes that if something is desirable, it must be achieved. They say the magic words ‘it must be achieved’ and sit back waiting for it to happen. Tony Blair was a little like this: he would say something like ‘we shall eliminate child poverty’, hand over the big picture to technocrats who, too scared of telling him it can’t realistically be done, chug along, nudging themselves in the right sort of direction until he has forgotten about it. But at least Blair never pursued something he knew to be impossible – you see, he was a pragmatist and never really believed in anything.

If you couple this dirigiste dreaming with religious fanaticism, however, you have problems. And religious fanaticism is what the euro is all about. Never mind that anyone who understood these things told them it wouldn’t work, a single currency was desirable, we would have it, it was part of The Project. Even now, when it is crashing round their ears, they can’t listen. Tony Blair would have dropped it a while back with a deft speech on how it was a jolly good idea, but one for the future. The people who run Europe can’t seem to do that.

To believe that Greece could have the same currency as Germany you have to be a fanatic, an idiot, or someone who has never left his own small town. The Germans strive to get ahead, they invest for the future, sacrificing present gratification, their system is, largely, incorrupt. It is quite the opposite state of affairs in Greece. This is obvious, but I am saying it now because it is particularly relevant.

Suppose a household has some sudden one-off expenditure but is fundamentally sound. It borrows, against its other wealth, say the unmortgaged portion of the house, and pays those borrowings off in time. That is solving a liquidity problem and borrowing is a very good thing for it.

Greece does not have a liquidity problem, it has a solvency problem. It is as if the members of the household had become unemployable: increasing the debts isn’t the answer. Greece needs to get working: it needs to cut expenditure, let the private sector flourish, collect its taxes.

And yet our euro-masters persist in presenting debt as the solution, because they can’t bring themselves to believe that Greece is different to Germany – they’re both Europeans, aren’t they? So Greece will get worse every year: as it lags further and further behind the others, bogged down by its sclerotic inefficiency. Already it has been unable to meet the targets of the last bailout.

Mr Barroso has stated that the solution to Europe’s problems is further integration. The Commission has proposed eurobonds as a solution, even though a decision of the German Constitutional Court only last week has said they would be unconstitutional.

French banks, immersed in the crisis of 2008, were told they had to hold more liquidity. Very good. What constituted liquidity for these muttonheads? Why, euro sovereign bonds. They chose Greek ones because Greek ones paid the best (they didn’t ask why – surely the bonds of all European countries are the same, aren’t they? I mean, they’re all European). When Greece started to get into trouble the French and European regulators told them to write down 20%. It should have been at least 45% then, and it should be at least 80% now. So this morning the French banks are downgraded.

Everybody knows Greece is going to default except the people who matter. These people need to be taken outside and repeatedly slapped until they come to terms with reality. Now they have left it so late it is not just Greece.

Libya - how we are helping

New Libyan Flag

Mustafa Abdul Jalil, the leader of the Transitional Council in Libya has declared that Sharia Law will be the main source of legislation in the new Libya.

So we have fought a war to ensure public executions, mistreatment of women and homosexuality punished by death.

I said at the start that we didn't know much about the people we were helping and now we know a little bit more.

Ring Fencing the banks

Today the Vickers Committee on Banking published its report and, as predicted, came out in favour of ring fencing.

The idea here is that investment banking and commercial banking are two quite different types of risk and one type should not subsidise the other. The first instance of this was in America in the 1930s and called the Glass-Steagall Act (GSA). The GSA however simply forbade banks from operating the two different functions: they had to be one or the other. As I outlined in a much earlier post, total separation is not however necessary. Ring-fencing would mean Barclays Group could own Barclays Bank and Barclays Investment Bank but that one bit couldn’t subsidise the other.

I am broadly in favour of Ring Fencing but with a few caveats. The first thing is that it isn’t the be all and end all of solving banking risk. It really isn’t too difficult to go bust as a commercial bank, either by making too many bad loans, as several banks nearly did in the 1970s and 80s, or by getting the funding wrong, as Northern Rock did. ‘The Rock’, as it was mistakenly called, didn’t have an investment banking arm and no amount of ring fencing would have saved it.

And then, of course, when a commercial bank was in trouble, it might be useful to rely on the funds of a successful and profitable investment bank: I have repeatedly said ‘one shouldn’t subsidise the other’ and whilst the Vickers Report seems to think the risk is that investment banks will get into trouble and take away the capital of commercial banks, it can go both ways.

The other caveat is the cost. Some figures suggest that it might cost the City $7 billion to implement the proposals and whilst others come in lower there will definitely be a substantial cost to this, just at a time when we need the banks to be doing more lending to private sector companies so they will expand and take on workers formerly in the unproductive public sector. Competing financial markets in America, the Far East and Europe aren’t proposing ring fencing.

My view is that we should do this, but not until there are clear signs that we are through the worst. And that isn’t now.

9/11

As everyone in the world, I suppose, already knows, this is the tenth anniversary of the attacks on the World Trade Centre and the Pentagon. It changed the world, mainly but not exclusively for the worse.

At the time, America had not suffered from terrorism and there was an uncharitable but understandable view current after 9 / 11 that it was probably better for all of us that they now had some experience of it. Something like 3,000 people died in the attacks, almost as many as died in the Northern Ireland ‘Troubles’, which had in part been encouraged by American politicians such as Ted Kennedy. Still, the ‘Troubles’ lasted thirty years whilst 9/11 happened in a few minutes.

It was shocking not just for the loss of life but for its symbolic importance. The Word Trade Centre was a totem of America’s economic might, in the heart of its chief city. There was a feeling that nothing would ever be safe any more.

The Second Iraq War and the war in Afghanistan would probably not have happened without 9/11, and the N. Ireland Troubles would not have been nearly so bad if the Americans had known what terror attacks on the civilian population was like. I don’t think, though, that it pays to dwell on these things.

The projection of power after 9/11 was so quick and so unsuccessful that we can say that those few minutes ten years ago have made the world doubt the use of military intervention. That might, I suppose, be a good thing.

One strange development was the extraordinary attitude of the British and European Left, who professed that America had somehow deserved this. I think you have to be a pretty strange person to adopt this view, although the Guardian newspaper and the BBC portrayed it as normal.

Lastly we have the conspiracy theorists, who have had a good ten years. A short trawl of the internet can reveal that George Bush organised the bombings so he would have an excuse for a war; that Israel was in fact behind it, following the false rumour that no Jews died in the blasts, or that Dick Cheney wanted an excuse to clamp down on civil liberties. They are the only light relief in the whole sorry business.

Opportunities to remain silent (2)

Pope Benedict XVI has reportedly blamed the recent riots in England on a moral relativism which has swept the country.

He may well be right, but, and I have said this before, this is from a former member of the Hitlerjugend who turned a blind eye to child molestation in his church. Despite his exalted position I am not sure I want to hear about moral relativism from this quarter.

I recommend to His Holiness the words of Seneca: 'It is a great thing to know the season for speech and the season for silence.'

Structured Co-operation

Don't know what 'structured co-operation' means? But you should, you should.

As you can imagine from the almost meaningless juxtaposition of two words, it comes from the European Union. What it means is that the unelected political class which runs Europe found it difficult to get along with this tricky democracy business and decided to enable a system whereby if some countries didn't vote for their policies, others could go ahead and enact them.

In this case it is having a military headquarters. Not content with NATO, the quintet of France, Germany, Italy, Spain and Poland have sent a letter to the amazing Baroness Ashton saying they are going to go ahead. Britain has of course said no and there can't really be a European military structure without Britain, but they have decided to spend the money anyway.

The reason is that their 'united' Europe has to have all the accoutrements of a nation state; an army, or at least the top brass bureaucracy of an army (apart from France none of these countries has anything like a significant military), is important.

Never mind the fact that Europe is breaking up, it's full steam ahead towards a disunited Europe!

Hypocrisy (No. 341)

John Galliano used to be the head of design at the fashion house Dior. At the beginning of this year he was sacked for having made anti-Semitic comments including, to the owner of a Paris bar, 'People like you would be dead today, your mothers, your forefathers would be gassed.' Today, because expressing your own opinions if they disagree with the State is illegal in France, Mr Galliano was given a suspended fine and told to pay the costs of a number of hangers on anti-racist groups.

In March this year, dismissing Mr Galliano from his post, the Chief Executive of Dior, Sydney Tolledano, said Galliano's comments 'totally contradict the values which have always been defended by Christian Dior'.

Er, no. Christian Dior made his name and his money during World War II dressing the wives and girlfriends of Nazi officers and collaborators.

For Mr Tolledano this would have been, as Jacques Chirac once put it, 'an excellent opportunity to remain silent'.

Abortion: the Dorries-Field Amendment

Nadine Dorries MP

Nadine Dorries MP is photogenic and also good copy, so it is perhaps not surprising that she should have received most of the publicity over the recent proposed amendment to the Government’s Health Bill, more than her co-promoter Frank Field, a long serving MP who seems to be about the only person in the House of Commons who is universally liked and respected.

Ms Dorries is a bit of a terrier, and refuses to let go of something once she has got her teeth in it, a quality perhaps better in an MP than it is attractive in a person.

Their proposal was that organisations who perform abortions for money should not also give ‘independent’ counselling: they are clearly not independent.

Unfortunately every suggestion concerning abortion is treated by the Left as an attack on abortion itself.

This was not, however, an attack on abortion, of which Ms Dorries declares herself to be in favour. There was no suggestion that a woman should not have the right to an abortion, only that the counselling she receives should not be from someone who stood to make money from her having the abortion.

I must say I had no idea that this could go on and was quite astonished. How many people do they counsel not to have an abortion?

Mr Cameron in particular has behaved disgracefully over this. He promised to support the amendment, and then when his coalition partners the Liberal Democrats said they wouldn’t agree, withdrew his support. At Prime Minister’s Question Time Ms Dorries had the courage to ask him when he would stop giving in to everything the Deputy Prime Minister demanded, and remind Mr Clegg who was boss. Mr Cameron began his answer with ‘I know the Honourable Lady is frustrated...’ and when there was a puerile outburst of giggles in the House, gave up and sat down.

Mr Cameron should apologise to Ms Dorries and explain to the public why he thinks it better that a woman should receive abortion counselling from the organisation which is going to operate on her for money.

PS Mary Wakefiled points out in the Spectator that one pregnancy in five is terminated in the UK, twice as many as in Germany. Why should this be so?

Four years

This blog began on 8th September, 2007 with a post on the fallout from the subprime fiasco, which seems less pessimistic than hindsight would demand. During these four years I have received some 33,000 page views.

There will be some changes to the format of the blog over the next few months but nothing dramatic.

I thank you all for reading it.

More changes....

Right at the last moment, Italy has given way to persuasion from its European partners and proposed what must be the fourth version of its budget in as many weeks. This time there is something to upset everyone: a wealth tax which Berlusconi initially refused to contemplate, a rise in VAT, which Tremonti the finance minister had previously rejected, and pension reform which Umberto Bossi, Berlusconi's main ally, said he would not tolerate.

So, that seems fair.

The problem is that all this uncertainty has painted a clear picture for investors of a government which hasn't a clue what it is doing.

More of the same

The German Constitutional Court, or Bundesverfassungsgericht, has, as expected, approved the Greek bailouts, rejecting a claim that they breached the Consitution.

This is good news in that a rejection would have thrown the markets into turmoil, but bad news in that it gives the green light to more of the same expensive and ineffective policies to prop up a currency which is entirely a political construct.

The Court has said, however, that future bailouts must be referred to Parliament, where Mrs Merkel is finding it difficult to maintain her majority.

Who are the rebels?

The case of Abdul Hakim Belhaj is nothing if not thought provoking.

What is alleged is that Belhaj was captured by the CIA in Thailand in 2004 following a tip off from Britain. It seems his associates told British diplomats in Malaysia that he wanted to claim asylum in the UK, that he got on a flight and was snatched by the Americans at Bangkok where he was tortured, and then flown to Tripoli where he suffered years of abuse in prison. He is now a rebel commander.

I am perhaps alone in the view that people get a little hysterical at the thought of torture. In this regard the chattering classes are not in the same place in the argument as the ordinary man: if someone knows of a plot to blow up a bus or train his daughter might be travelling on, the ordinary man wants the guy tortured.

In this regard Belhaj was a member of the Libyan Islamist Fighting Group, which had strong links to al-Qaeda. Whilst it is a little bit sneaky allowing the guy to board the plane in order to claim asylum – he had no visa – it was a bit sneaky of someone who had terrorist links to claim asylum in the UK in the first place.

The British and Americans wanted Belhaj removed from operations and who better than Gadaffi to do that: Belhaj was Libyan (albeit with a range of false passports) and the Colonel saw LIFG as a threat.

What I want to dwell on for a minute is that ‘Islamist’ in the title. Belhaj has renounced terrorism, he says, and severed links with al-Qaeda, but is he an Islamist, wanting, like the Taliban, to restrict individual liberty, by force if necessary, in conformity with their interpretation of the Koran?

I have written before that we don’t seem to know much about the people we are supporting, and this guy was not so long ago regarded as sufficiently nasty that we handed him over to Gadaffi.

A politician by any other name

James Perry

I have written before about British politicians such as Gideon 'George' Osborne, Alexander 'Boris' Johnson and John 'Vince' Cable who for some reason don't want to go under their given names, as if they were hiding from their creditors.

But it is not just a British phenomenon; I now learn that the front runner for Republican Presidential Candidate, Rick Perry, is in fact called James.

PS his wife is called Anita Thigpen, which nobody could have made up.

A service to the world

From the Daily Telegraph: 'They were the Tripoli rebel underground, the people who kept the resistance fire burning in the heart of Gadaffi's capital....And one of their main leaders was a NHS dental surgeon from Cardiff.'

Strangely enough Bashar al-Assad, President of Syria, was an ophthalmologist in London, Col. Gadaffi received military training in England and almost every tinpot dictator on the planet has studied at Sandhurst.

Britain is obviously providing a service to the world, even if sometimes you wonder which side we are on.

Auxology and the aubergine

Auxology, not in my Oxford English Dictionary, is apparently the study of human growth, and according to the Auxology Institute of Milan, Italians are growing more than most. Outwards, that is, not upwards.

Despite being famed for its Mediterranean diet, Italy has the highest proportion of overweight children in Europe. The diet has, it would appear, been abandoned for the sort of fast food the rest of Europe eats.

One issue must be that more Italian women are working and haven't the time to cook for their children.

So as the British increasingly eat like Italians, Italians increasingly eat like British. It seems a shame, really.