French election? It's all about Europe in the end...

Where does one even begin to discuss the drama that just unfolded before our very eyes in Paris? Hollande's victory now cements a widely-expected change in the French political landscape.

But what changes can we expect? With Hollande returning socialism to French political life, we can expect the usual symptoms of spending, reaffirmed with promises that this will make all the difference. We can expect more "community" based measures, which ultimately, the wealthier part of French society will pay for, with their expected 75% tax rate. We can also expect other "bad" groups to be expected to pay, i.e. the financial sector, as Hollande will stubbornly introduce a Tobin tax on financial transactions in France, even if he can't first secure it at the European level.

However, hiding behind this wonderful illusion that spending solves all problems is the reality that you cannot spend what you don't have, so as well as increasing taxes you can expect the new French administration to borrow. Except that's not as easy as it once was, with the Euro debt crisis meaning that France is already up to its eyeballs...in debt.

As a consequence, we can expect France to be pushing at the European level for all measures to "save" the euro, which, when translated into French, means extracting money from the other 26 EU member states to save French banks....the more enlightened of us already know however that it's these banks, and not the German/Spanish/Irish/Portuguese/Italian/British ones that have the highest exposure to Greece.

With French banks saved, the French economy is prevented from collapse, and the French Government cannot become any more indebted to saving its own banks, (assuming that the money is eventually transferred from the EFSF/ESM directly to banks to avoid any bailout being recorded on a Government balance sheet) which have failed just as miserably as any "Anglo-Saxon" ones. But, the core problem will remain, and government debt will ensure that this socialist administration will not be able to fulfil its pledges. They will come to understand that if you don't have the money in your piggy bank, you simply cannot have what you want. It's a form of poverty, that some other political philosophies understand well.

Of course, the underlying aim of the French Government in joining the upcoming fiscal union/economic government/full monetary union/bank union or whatever they'll call it is not just to maintain the illusion of an economically strong France, but to continue to cement French political power within the European Union. The French have long benefited from being able to project French post-imperial power through the European project, and they will not let that go easily. Being able to influence the EU to do what France wants is the only real power France has.

If the French Government, in its likely disagreements with austerity-Germany is at risk of losing its influence in Europe and having other countries dictate to it through EU rules, you'll soon see just how much "solidarity" the French really believe in. They'll stamp their feet and make threats....

It's going to be an interesting few months, as the French desperately try to hang on to their influence as the Germans lead the way - but they won't like the German economic cure, so expect blackmail of some sort. France wants the political influence and the economic power - but you are in debt dear France, so you'll have to choose what is most important. You cannot have your cake and eat it.

In conclusion though, I sense that the idea of Europe is the most important thing. And the French will not sacrifice that for a few promises of government spending. So all Europe needs to do is to help Hollande save face by keeping his borrowing costs low so he can mortgage the next two generations of French children. With the EU extracting political power from France as its price of solving this crisis (Germany hiding behind the EU) and seizing the crisis as the moment it has been waiting for to build its federation, whatever Hollande promises, this French administration will be like the last one - all about Europe in the end....

The European Court of Human Rights (ECHR)

There is a lot of talk at the moment about if the ECHR is fit for purpose.  Some say that without it, our entire evolution and understanding of human rights since WWII is lost, others say that the Court has evolved beyond its remit and is now infringing upon its members sovereignty, particularly in their abilities to prevent terrorism and other security threats.

This is certainly the current point of view of the UK Government, who have made it clear in recent days that they feel the Court needs to change.  The catalyst is of course that the UK currently holds the Chair of the Council of Europe, and has the political will and place to now effect change.  The other catalyst that has caused uproar is the recent judgement of the ECHR that the UK cannot deport the terrorist suspect Abu Qatada back to Jordan, after three UK trials determined that he is a risk and should be sent back.

David Cameron is right to seek change.  He is right to say that human rights laws are becoming distorted (see here) He is also right that the Court should be the last resort, and used where a national justice system is unable or unwilling to deal with or decide upon a case.

Europe agrees that there should be reform, although apparently doesn't much like the idea of deferring to national governments.  So, should the ECHR become supranational?  That's not what it is about; it is not the EU.  It is still based on intergovernmentalism, and David Cameron should perhaps consider the idea of withdrawing the UK from the Court if it continues to infringe on our sovereignty and put the country at risk.  These arguments are strong ones, and should not be disregarded on a whim.

Those who say that our voice would be lessened are thinking from a supranational perspective.  The UK is not about to abandon its commitment to, or respect for human rights.  Very likely the UK would remain in the Convention even if it were to withdraw from the Court.

It's true that where the court has helped UK human rights culture to evolve has to be acknowledged.  But we are now talking about putting our national security at risk, and the even more-worrying evolution of an institution that has gone beyond, and will continue to go beyond, its raison-d'etre, if not put in check.  Looking at the EU as the best example, I don't want to see this happen with the ECHR - that's where things may just get really dangerous.

Scotland, oh Scotland.....

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It was rather impossible to miss the the explosive debate that began just last week when David Cameron threw down the gauntlet to Alex Salmond and demanded a referendum on the Scots leaving the United Kingdom. I'd like to offer my thoughts.

It is well-known, and I noted myself in my blog post on St. George's Day 2008, that the debate about Scottish secession has been looming for quite some time. What nobody really expected was the extent of the Scottish National Party's (SNP) victory in the Scottish Parliamentary elections in May 2011. Since this occurred, it is now politically possible for the SNP to table a referendum to the Scottish people.

Cameron started the official "war" over secession last week when he demanded that a referendum be held sooner rather than later. Rather surprisingly, this prompted Alex Salmond to reveal hitherto unknown information about when exactly he was planning his referendum - late 2014 to coincide with Scotland's greatest military victory (were there many others?) over England 700 years ago.

Now that we know the SNP's plans, the Government demanded that it be sooner, and has now given a list of conditions that the SNP must meet for the referendum to be legal under UK (and inherently Scottish) law.

My aim here is to simply draw a clear picture. Certain elements of the story are wholly misrepresented and/or plainly misunderstood by a large number of people.

First of all, this is not actually an "independence" vote at all. The word "independence" has connotations that usually imply that one party/country has been dominated by another, usually through conquering or colonisation. This is simply not the case. This is about Scotland choosing to leave the United Kingdom; a union that it agreed to in the first place. It is not for me to judge the circumstances under which Scotland joined the Union, but it is perfectly free to choose to leave should it so wish. The language of the debate really needs to be accurate, for the Scots are deciding whether to leave a union that it joined as a sovereign nation, and the people are simply now voting for the return of full sovereignty to Edinburgh as supposed to London. The consequence of course is that the English will regain full sovereignty from the Scots too, a point not often mentioned.

Secondly, I have read a wide range of comments and articles from those who feel that England should have a say in this. The logic goes that as the UK will be affected, everyone in the UK should decide if Scotland leaves. My view is that this is incorrect. If everyone was to decide if Scotland should leave, how would we ever know the true wishes of the Scottish people? It doesn't seem democratic to me to not allow the Scots to choose to restore sovereignty by themselves. It is on the other hand perfectly reasonable that if the Scots want to leave, they have the right to make the choice. True, there are consequences for all of us in England, Wales and Northern Ireland, but should the tables be turned and one of us wanted to cede from the UK, we wouldn't want the Scots to decide for us either.

Those supporting the idea of the entire UK having a say is making an argument akin to all EU members having a vote on whether the UK should leave the European Union. The UK is still in many ways (but dwindling I acknowledge) a sovereign nation, but even if we were a part of a United States of Europe we would not allow 26 other countries to prevent us from doing what we wanted to do. We can expect no less from the Scottish people. The problem is though in our relationship with the EU is that we have agreed to the fixed procedure for leaving, as written in the Lisbon Treaty, and we would need to determine our position with regards to the treaty.

Thirdly, I concur with the clear legal view that under the Scotland Act of 1998, Alex Salmond has no legal mandate to conduct the referendum - it is for Westminster to determine constitutional issues, and for Westminster to give Alex Salmond the necessary legal powers for the referendum vote to be considered legal. It really is stupid that the SNP are denying that Westminster has this right when it is plainly written in law - and worse for them to use Westminster's conditions as proof to their followers that "the English want to interfere." There is a major alarm bell going off in my head here. The law is the law, Mr Salmond - the UK will respect the rule of law, and you shall challenge it at your peril!

Fourthly, I've noted the interesting attitude reflected in the opinion polls - that more Englishmen and women are keen for the Scots to leave the UK than the Scots themselves. This reflects years of Alex Salmond antagonising the English, and thus attempting to link Scottish secession with English desires. He is playing with fire and might just get his wish. But he shall be to blame for the consequences, not the rest of us.

Finally, I am not prepared to debate in full the financial side of Scottish secession, however I side with the view that the Scots will be worse off. Some believe that the Scots should shoulder a proportional amount of UK debt based on their population, but I disagree. Population was not the measure used when the debt was generated and nor should it be if the debt has to be shared. A substantially large amount of UK Government debt was spent stopping the collapse of Scottish banks, therefore those Government liabilities should in due course become the liabilities of a fully-functional Scottish Government.

To close, there is much more to say when you hold this debate up in the mirror and compare it with the ongoing debate of the UK's changing relationship with the EU. It is quite amazing and hypocritical to see the UK Government saying things in relation to Scottish secession that they would never say in relation to the UK leaving the EU. The hypocrisy stinks when Cameron says that "the Scottish people must have a vote sooner rather than later" and yet denies a vote on EU membership when there is a clear public demand to do so. These issues are for another post, as well as Scotland's and the UK's overall place in the EU given the outcome of a yes or no vote in Scotland.

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The cards are finally on the table......

For many years, British politicians have been stringing the public along with grandiose ideas about the EU being a group of sovereign nation states, engaged in deep level cooperation and trade. The EU was an economic project, and there was no risk at all to British sovereignty. Even the layman with the faintest idea about the EU now knows that to be false, seeing as our lives are affected each day by EU legislation, and increasingly in more and more visible ways.

But even though we are all conscious of the loss of British sovereignty, those who dared speak the truth of the EU mission - political union and a European state (I politely decline to use the word "super" in relation to the project) were labelled as "little-Englanders," just plain stupid, scaremongers, and one of the most disturbing recent terms I've seen is "domestic extremist" - no joke!

Now that these bunches of extremists - those who plan to lead us all to war just because they don't want to be part of a political union - have been vindicated, nobody can be found to defend the status quo. They've gone and jumped on the bandwagon of "more Europe" - precisely the blind way of thinking that got us in this mess in the first place. I am all for those who want more Europe, but I do not want to see it for the United Kingdom.

Now the extremists have been vindicated again. This time, there is no denying that they were right; there is no trying to avoid the truth by interpreting it in a different manner, or playing politics with words. The extremists told us that the plan is political union - this has been denied constantly and constantly. Many British ministers know the truth, but I also accept that some of those ministers who have spouted this lie over the years genuinely believed they were right - Margaret Thatcher for example. I think she genuinely wanted to see Europe as a group of nations that cooperate. She even made sacrifices to try and ensure that her interests shaped the Union. (I'm thinking of the Single European Act) But in the end her idealism was just too idealistic.

Why can't the truth be denied now? Why are the cards truly on the table? You might think it's because of what's just happened in Greece and Italy - the instalment of two EU puppet technocrat governments, but it's much simpler than that. And it's simplicity that is the hardest thing to deny. The cards are on the table now, and we must wake up, simply because of what Germany has been saying over the past couple of days:

1) As reported in the Telegraph on 17th November: (click here)

"The six-page German foreign ministry paper (A leaked German foreign office memo; my italics) sets out plans for the creation of a European Monetary Fund with a transfer of sovereignty away from member states. The fund will have the power to take ailing countries into receivership and run their economies. Even more controversially, the document, entitled The future of the EU: required integration policy improvements for the creation of a Stability Union, declares that the treaty changes are a first stage “in which the EU will develop into a political union”. “The debate on the way towards a political union must begin as soon as the course toward stability union is charted,” it concludes.

Is it still not rubbing in yet? Is there a way to deny these words? Is it just "enhanced cooperation?" Let's try some more....

2) Referring to treaty change, the Guardian reported almost a MONTH AGO (click here) that:

“The drive for this is coming, however, from Berlin. This is the real story of what is happening in the EU: Germany is emerging, unstoppably, asprimus inter pares. The dissension with Paris arises because Merkel simply won't or can't tolerate many of Sarkozy's ideas for resolving the sovereign debt crisis on political and constitutional grounds. The one-time "economic giant, political dwarf" is no longer afraid of exercising its political clout.”

3) Is it still not rubbing in yet? Let me cite one more interesting piece of information, this time from David Cameron. He's still taking the positively stupid line that this is a "great opportunity" to reform the EU, and the rather intensely stupid idea that he can reform it and mould it to British lines. Please cut the crap as of now. The plan is decided. It's political union. To be or not to be, that's the question? Thankfully we know the answer: No for the UK. The referendum will surely come when the necessary treaty changes to create this union are made - as it is now locked into British law. How will Cameron escape that? (Article here)

“Senior figures in the German government proposed radical changes to European institutions. In an interview with Le Monde newspaper, Germany’s finance minister Wolfgang Schauble called for continent-wide elections to vote in a president of the European Commission who would be head of a “European government”.

There you have it, Ladies and Gentlemen. From talk of treaty change a month ago, to the plans for political union this week, things really do move quickly, and it's impossible to keep up with them. But I have spelled out my case - the cards are truly on the table. If anyone would like to refute these quotes, I'd like to hear from them. Otherwise, to me it's really clear - a European Commission at the head of a European Government, and German plans to change its own constitution (after bailing out the euro was deemed illegal) to create a stability union that will evolve into a political one.

Let's not forget of course, that with all these wonderful plans on the one hand, Cameron just reminded us (the same link as above) that:

“It’s the pointless interference, rules and regulations that stifle growth not unleash it,” the Prime Minister said. “The sense that the EU is somehow an abstract end in itself, immune from developments in the real world, rather than a means of helping to deliver better living standards for the people of its nations.”

The EU is not improving living standards. It is just interfering; it is immune from developments in the real world - well said. Political union is just another representation of this fantasy world. The truth is that people just don't want it. But the EU and most politicians are just not listening. It's only a matter of time until revolution and when European history is likely to repeat itself. Let's see for how much longer British politicians want to continue to string us along, as even the layman opens his eyes to the effective loss of sovereignty of the United Kingdom, without a single shot being fired.

Taxpayers are in debt because of their stupid Governments! Brown admits to "socialising the liabilities."

The problem I have with what's going on is that to ultimately save the Eurozone, it's taxpayers that will foot the bill. This has been the whole injustice all along. If anyone thinks that's dramatic, then look at what Gordon Brown just said at the World Economic forum. He stated that in his view this is still a banking crisis at its root, but if it has become a debt crisis it's because "we socialised the liabilities" - Let me find the full quote.........

""The European banks as a whole are grossly under-capitalised: they have liabilities far in excess of American banks. We have now got the inter-play with sovereign debt because we socialised the liabilities"

http://www.telegraph.co.uk/finance/financialcrisis/8768575/Gordon-Brown-fears-euro-crisis-worse-than-Lehman-as-1930s-beckon.html

To imply that there was no debt crisis before the banking crisis is misleading, and wholly incorrect. Brown also completely proves to us how taxpayers are paying the bill (socialising the liabilities) but now claims that is the reason for debt! What? I think the truth is closer to the idea that when you pile more sovereign debt onto countries that were already living in a debt bubble (most of the Eurozone since they believed that the € was their saviour and the end of all economic bust cycles, were offered cheap credit, and once you throw a socialist government into the mix you usually get indebted) then of course governments end up in the same mess as banks, who were only responding to lighter regulation by taking more risks.

Illegal Bailouts!

There you have it! Even the Bundesbank know that the EU bail outs are illegal, and are simply a way to bring debt union (fiscal union) in through the back door!

http://www.telegraph.co.uk/finance/financialcrisis/8716783/Bundesbank-questions-legality-of-EU-bail-outs.html

Economic Government might have just finally arrived

So, I’m sitting here watching Sky News Live, and they’ve only just switched to the Euro Summit (or better said Franco-German summit to save the Euro) in Paris, as the news conference currently goes on. Breaking news it seems – “Merkozy” (coined this word from what I saw in today’s Telegraph) seems to have decided that the solution to the euro’s woes are “collective government for the Eurozone led by the EU President.”

So there you have it. The EU President comes into office in grandiose style post-Lisbon, with supposedly lots to do but in reality very little other than chair a few meetings a year, has a power struggle with the Commission but loses, so he needs something to do to legitimise his position. I seem to remember him shortly after taking office speaking about “economic government for Europe” and the furious reaction that his statement created.

Look at these links: http://www.independent.co.uk/news/world/europe/eu-presidents-secret-bid-for-economic-power-1894549.html and http://www.eubusiness.com/news-eu/summit-economy.2l4 - couldn't get it more from the horse's mouth than through EU Business.

But if instead you're interested to know how an economic government might be run, just take a look at what the head of the Eurogroup said back in April - http://euobserver.com/19/32222

So, here we are, a few steps down the crisis line, and wow, suddenly the solution seems to be precisely what the EU President proposed, because he now has something to do by being put in charge of it. Sounds like an outcome that was pre-determined to me (I just don’t trust the way some of these Eurocrats think, and yes, Presidents and Chancellors of sovereign countries are just part of the Eurocrat machine) and it was just a case of finding the right “opportunity” to bring the idea in. What better time than when the crisis really is at the end of the line, and enough panic has been created, and the markets are jittery? Anything can be forced through in the name of economic stability, regardless of political consequence.

I’m upset with Sky News and the BBC – both are just reporting it as a moving ticker underneath their broadcasts – and carrying on reporting other events like it is not important. Sky claims its source as the Associated Press but I can’t even find an article yet on their front page either. It really is amazing how the UK press is completely under control – I trust economists’ blogs now more than news reports.

Political union is well and truly alive, and whereas economics were cast aside before in the name of political union, now it is the mechanism by which political union will be achieved. I suppose that all you had to do was to create the economic crisis by forcing the creation of a single currency for political purposes, ignoring all the economic advice, and then when that advice turned out to be right, suddenly you could focus your attention on the economic problems and advance your political agenda through them. What a con – and everyone is in on it.

Notes

1) Even David Cameron knew the economic government idea was coming: http://www.euractiv.com/en/priorities/Britain-wins-opt-out-on-economic-government-news-495370)

2) 10 minutes later....Some news articles just being posted to the net: http://www.newser.com/article/d9p59i2g0/merkel-sarkozy-propose-eurozone-economic-government-amid-debt-crisis.html

3) Anyone for a secret debate? http://euobserver.com/19/32222 It's precisely because of this way of thinking, which pervades the EU to its inner core, that I cannot support the European project.