Tuesday, December 16, 2014

Mixed news from the House of Lords

Two Questions from Lord Stoddart of Swindon. The first one was straightforward as was the reply:
To ask Her Majesty’s Government, further to the Written Statement by Lord Deighton on 26 November (WS 37) concerning the meeting of ECOFIN on 7 November, whether they plan to continue their opposition to the proposed Financial Transaction Tax; and whether they will indicate that they will not facilitate the collection of the tax in the United Kingdom.
HMG, in the shape of Lord Deighton reassured everyone:
The UK is not participating in the Financial Transaction Tax (FTT) proposed to be adopted by 11 EU member states.

The Government strongly objects to certain extraterritorial aspects of the European Commission’s proposal, which in our view breach EU Treaty requirements.

While any eventual FTT is likely to be significantly narrower in scope than the current proposal the Chancellor has been clear that the government will not hesitate to renew its legal action against the FTT if our concerns are not addressed.
Well, that's a relief or partially so, as the chances of HMG holding out are not very strong, if past experience is anything to go by.

The second Question elicited a more intriguing reply:
To ask Her Majesty’s Government, further to the Written Statement by Lord Deighton on 26 November (WS 37) concerning the meeting of ECOFIN on 7 November, what will be the effect of the proposed amendment to Directive 2011/96/EU; and whether it transfers further powers over taxation to the European Union.
Once again it was Lord Deighton who replied (well, to be quite precise, as these Questions were written one, the minions dealt with it all, with nary an intervention by the Minister):
The amendment to Article 1 of the Parent Subsidiaries Directive introduces an anti-abuse measure, which requires Member States to withdraw the benefits of the Directive with respect to tax arrangements, where gaining a tax advantage through exploiting the Directive is a main purpose.

UK officials have worked successfully to incorporate UK changes into the text. These ensure that the rule is proportionate, is in line with OECD recommendations on Base Erosion and Profit Shifting, and does not delegate further powers to the Commission.
I shall leave the details to the financial experts among my readers (there must be some) but would like to point out something interesting. The new rule is in line with OECD recommendations. That is in line with what the Boss has been saying for quite a long time (and it feels even longer): it is not always the EU that decides on these and related matters. There are organizations above and beyond it and the EU merely puts their rules and recommendations into place.

How could I forget the Red Lion talks?

This is becoming something like "Chapters from my life in euroscepticism" - a tragicomedy. When I wrote yesterday about the many eurosceptic publications that I uncovered on the top shelves of my study and the depression inspired by those failed hopes I forgot about the Red Lion Talks. How could I?

As a matter of fact, I did mention them once, in my obituary of Sir Robin Williams, the Secretary of both the CIB and of the Anti-Maastricht Alliance for many years.

Some time between the two Danish referendums on the Treaty of Maastricht Alan Sked and I were invited to address the various groups that were fighting for a second no vote in Copenhagen. The meeting was very different from the ones we were used to: instead of the usual format of audience and speakers on the podium we spoke informally (in English) in a cafe. People turned up, ordered drinks, sat at tables and chatted to us afterwards.

What a good idea, I thought, and raised the subject at the next Anti-Maastricht Alliance committee meeting. Of course, in England the meetings would have to be in a pub rather than a cafe but apart from that there need to be no difference. A format of that kind might well attract an audience who would not bother to fight its way through security in Parliament or attend meetings at the LSE. If the talks turn out to be successful other people in other cities might start some, too.

Financially, only a very small outlay was required and I started organizing. The Red Lion Pub is the nearest pub to Westminster, on the corner of Whitehall and Derby Gate, well known to all in the political world and easy to get to for other people. As it happens, at the time they did not serve dinner in the upstairs room and one could hire it for a small sum, assuming that many of the audience would patronize the bar.

The talks ran for several years, as I asked various people, some of whom spoke at other eurosceptic meeting, some of whom kept away from them, to cover subjects related to the European Union. I have particular memories of Noel Malcolm (now Sir Noel) talking about the common foreign policy and, another time, about the EU and the Balkans; of Professor Kenneth Minogue (alas, no longer with us) speaking to an audience that filled the room, the corridor outside and the stairs that led to the staff quarters about democracy and bureaucracy; of Peter Shore talking about British history (on the whole, I did not want MPs pontificating at the Red Lion but I made exceptions for Peter and for Sir Richard Body). Many others come to mind as well: Professor Antony Flew, Dr Martin Holmes, then Co-Chaiman of the Bruges Group, a slightly less likely speaker, Caroline Ellis from Charter 88, Bill Jamieson who explained very clearly the economic advantages of being outside the EU, James Sherr who talked about the EU and Russia, Christopher Booker speaking to another crowded room and corridor about the regulatory disasters and, of course, the Boss. And so on, and so on.

The talks went on for several years. I produced a six-monthly programme and advertised wherever I could, including Time Out and various other outlets. The bar made good money and, sad person that I am, there were even pitta bread sandwiches that I prepared.

All but one of the talks were recorded but only two have been transcribed, one of Noel Malcolm's and Peter Shore's, which was published in the European Journal. The box with the tapes are also among the many objects I have to sort out as I restore my study. They will not be thrown out. (The various pamphlets and papers were not either.)

After several years I noticed that the talks mostly consisted of the same people saying the same things to the same audience. Time to bring them to an end, I decided, and I did. This was one of the most sensible decisions I made. It is all too easy to carry on with something because it is there, beyond what might be called the sell-by date.

Should I revive them? Would anyone be interested in the age of Farage versus Brand? I have serious doubts. But, maybe I should transcribe them and publish them on line, just to remind everyone of what the eurosceptic debate was like once upon a time.


Monday, December 15, 2014

À la recherche du temps perdu

Yes, yes, I know there is an English translation of that title but, somehow, In Search of Lost Time does not have the same evocative sound. Readers will just have to put up with the French version.

The process is, in fact, not so much evocative as depressing. As a consequence of urgent building works I have had to move everything out of the room I rather grandly call my study. (Others call it something else and make pointed references to the piles of books, papers and sundry other material, now piled up in various other parts of the house.

This morning I decided to tackle the mess that was masquerading as books, pamphlets and journals on two of the top shelves. Having removed them and cleared the shelves from the building rubble that had accumulated there over the past weeks, I began to sort things. Some journals went into the recycling bag immediately. Long out of date ones I have never read and not likely to do so.

Then I sorted the papers, pamphlets and books. That was when depression descended on me. They were all those papers etc that were written in 1992 -3 when we were fighting the Maastricht Treaty, later on when we were fighting other treaties or the euro, and a few written in between. They all tried to prove what a bad idea Britain's participation the project was, explained that the only reforms we could have were those that furthered integration and tried to deal with such questions as "how do we get out" and "what do we do afterwards". Sounds familiar? Yes, to me as well. And I did not even look at the various issues of such publications as the European Journal, which, at one time, published a good many of my articles as well. Or other journals and periodicals.

Of course, one could argue that we have moved a little. We are not in the euro though that was mostly Gordon Brown's doing with a good deal of help from James Goldsmith and it is now possible to discuss Britan's exit from the EU in a more or less serious fashion (unless you happen to be a member of UKIP).

As against that, one must point out that we are further away from that exit than we have been for some time, with little evidence that public opinion is coming round to our point of view. Just recently I was once again informed by a couple of young politicos that they really needed a good deal more time before they could seriously accept the notion that coming out would be quite a good idea. How much time would they need, I asked politely. There was no clear answer.

Many of those papers, pamphlets, books are of very high quality and deal with various aspects of the problem seriously and coherently. Perhaps, the young politicos of my acquaintance could try reading them and find out the arguments instead of re-inventing the political wheel.

One cannot help feeling depressed when on looks at all that material, remembers the work that went into it all and the hopes that accompanied that work. Just one more push, we thought over and over again.

Well, we have pushed and pushed some more. What have we achieved in reality? Nigel Farage v. Russell Brand. Golly gosh.


Not looking good

Greece, readers of this blog will not be surprised to hear, is still in trouble and, as that great economist, Vicky Pryce put it in today's Evening Standard, this shows that the Eurozone's troubles are not over (did anyone actually believe they were?). In fact,
Stock markets across Europe have been falling as Greek troubles threaten to bring down the whole EU economy.
Ms Pryce ought to realize that there is no such thing as "the whole EU economy" but, clearly, Greece's continuing troubles do not help. Neither do the various other problems:
This time Greece is not alone. There are worries about growth prospects in China, concerns about the struggling Japanese economy, and fears that the decline in the price of oil reflects a slump in demand due to weakening world growth. In the UK, the FTSE 100 was 6.6 per cent down in the week, as energy companies took big hits, with Brent crude falling to $61 a barrel on Friday, less than half the price of $115 a barrel in June this year. Concerns about stagnation and deflation led to widespread falls in stock markets across the eurozone.

With Italy back in recession and France in increasing difficulty, one might imagine Greece’s problems are small by comparison. After all, the country represents no more than two per cent of the eurozone’s GDP. But it has become the symbol of the eurozone’s sustainability.

Greece’s fresh problems have been exacerbated by a return to political instability. Greece had been given an extension of two months to meet its bail-out conditions for the final instalment for its €250 billion loan from the “troika” of the European Central Bank, European Union and IMF. This in turn meant that Greek Prime Minister Antonis Samaras could not obtain agreement to exit the conditional arrangements of the bail-out package by the end of this year, as Ireland and Portugal have done.
So, a snap presidential election by MPs will happen and the EU is apparently worrying:
EU commission chief Jean-Claude Juncker has warned Greece against electing "extreme forces" into power and said he would prefer "known faces" - so far the strongest intervention of the EU top brass in the Greek campaign.

"I think that the Greeks - who have a very difficult life - know very well what a wrong election result would mean for Greece and the eurozone," Juncker said during an Austrian public tv debate with EUobserver and several other Brussels-based journalists.

He steered clear of explicit political advice ahead of presidential elections in Greece next week but said: "I wouldn't like extreme forces to come to power."

The presidential elections - to be held in the Greek parliament on 17 December - could trigger early parliamentary elections, if there are three failed attempts to elect a president.
Will the Greeks listen to these wise words? Who can tell? Just in case, Pierre Moscovici, the Economics Commissioner has flown to Athens for last minute negotiations:
Moscovici’s visit is meant to focus on reaching agreement on the last economic reforms Greece must make before the final tranche of €1.8 billion from its €240 billion bailout is paid out - however the dynamics of the presidential election are set to take centre stage.

Antonis Samaras’ governing coalition, led by the centre-right New Democracy party, brought forward the presidential elections this month in a bid to stave off early parliamentary elections that it fears could bring the left-wing Syriza opposition to power.

The vote will be held in the Greek parliament on 17 December. It could trigger parliamentary elections, if there are three failed attempts to elect a president.

The government is reliant on the support of several minor parties for its majority and has raised the spectre of Greece being forced out of the eurozone if Syriza takes power.
Meanwhile, things are not looking good in Belgium, either. Indeed, it has been "paralyzed by a general strike".
The entire Belgian airspace is closed on Monday (15 December), as well as high-speed trains from Brussels to London, Paris and Amsterdam and local buses, trams and metro lines, as part of a general strike over public sector cuts.

Schools, government offices and private firms are also likely to be closed on Monday. Garbage will not be picked up and newspapers will not be delivered.

Serious traffic jams are expected around Brussels and Antwerp, with transport trade unions calling on truck drivers to join in and "paralyse the country".

Trade unions already staged a huge march which ended in violent clashes with police a month ago, when the government first announced the plans to save €11 billion over the next five years. The measures include scrapping an automatic indexation of salaries next year and raising the retirement age from 65 to 67 from 2030.

Belgium last month was flagged up together with Italy and France and given time until March to bring its budget in order or face extra scrutiny from the EU commission.

Unlike France, Belgium is sticking to the three-percent budget deficit rule, but its public debt is set to reach 107.8 percent of GDP in 2017, compared to 104.5 percent last year. Under EU rules, countries should keep their public debt below 60 percent of GDP.
If memory serves me right, this kind of thing was not going to happen once the euro was established.

Saturday, December 6, 2014

Sometimes one finds out things in the House of Lords

Lord Stoddart of Swindon has been busy again (and a good thing, too). He asked HMG
what was the value of United Kingdom overseas aid administered by the European Union in 2013; and what they expect the figure to be in 2014.
This blog would argue that it matters little who administers overseas aid as it is likely to lead to waste and corruption in any case and is unlikely to lead to economic development. But I digress.

HMG in the shape of Baroness Northover replied:
In 2013, the UK share of official development assistance funded from the EU budget was £813 million. UK’s contribution to the European Development Fund (EDF), a Member States voluntary fund not financed from the EU budget but also administered by the Commission, was £407 million. Estimates for the UK share of official development assistance funded from the EU budget in 2014 will be published in April 2015 as part of the provisional ODA: GNI statistics publication for 2014. The UK’s contribution to the EDF in 2014 is currently estimated to be £328 million.
That is quite a lot of money that is wasted or used to shore up corrupt and oppressive governments and organizations. Let us not forget that the UK gives money to these directly as well as through the EU and through the UN. So, we give overseas aid several times over.

One of the organizations we give aid to directly as well as part of the EU is the unspeakable UNRWA, whose purpose is to keep Palestinians in refugee camps and refugee status. It so happens that I went to a presentation on the subject a couple of days ago and intend to write about it in detail quite soon.

Back to Lord Stoddart. He also asked:
whether they will now answer the question originally asked namely, “whether they will consider recommending withdrawal from the European Union if their objectives cannot be met through negotiations”.
Baroness Anelay of St Johns replied:
The Government’s position remains the same: the European Union must reform to become more competitive, democratically accountable and fair for those inside and outside the Eurozone. The need for reform is widely acknowledged amongst the EU Institutions and other Member States.

The UK’s membership of the EU brings many benefits to the UK, including jobs and investment; a strong collective voice to negotiate free trade agreements; and greater international influence on global threats such as climate change and Ebola.

This was demonstrated at the recent European Council last October where EU leaders agreed to the 2030 climate and energy policy framework—the world’s most ambitious targets so far—as well as agreeing to increase EU financial help to fight Ebola to €1 billion.
I take it that is a no.

Wednesday, December 3, 2014

A government crisis in Sweden

By that I mean that the Swedish government has fallen and a snap election has been called for the first time in fifty years. Whether that is a crisis or not I leave readers to determine.

EUObserver ticker gives the news baldly:
Sweden's minority Social Democrat government may fall on Wednesday, prompting new elections, after only two months in office. The political crisis results from the far-right Sweden Democrat party announcing its support for the centre-right Alliance opposition bloc's alternative 2015 budget. The Alliance and the far-right hold a majority together.
Reuters gives us more in a more up-to-date story:
Sweden will hold its first snap election for more than half a century in March after a far-right party helped defeat the center-left minority government's first budget in parliament on Wednesday.

Formed after a fractured September election that handed the anti-immigration Sweden Democrats the balance of power, Prime Minister Stefan Lofven's Social Democrat-Green coalition has been widely viewed as Sweden's weakest government in decades.

Shunned by mainstream parties, the Sweden Democrats have threatened to make Sweden effectively ungovernable unless the country adopts tough immigration policies like those of nearby Denmark, including a 90 percent cut in asylum seeker numbers.
Of course, shunning a party that has some electoral support is never a good idea but the Swedish main-stream parties are not the first to make that mistake.

The issue here is not anything seriously evil but whether Sweden should continue its open door immigration policy, given that it puts the famed Swedish welfare model under strain and has caused a number of problems with communities that have no intention to integrate into the Swedish society. Indeed, some have demanded that Swedish society should adjust to their standards.

At the very least, this should be debated and, as things stand, the Sweden Democrats are making sure it will be.
The rise of the Sweden Democrats has also threatened to break a decades-old agreement across the political spectrum on an open door policy for refugees. Former Prime Minister Fredrik Reinfeldt has called Sweden a "humanitarian superpower".

Mattias Karlsson, the acting head of the Sweden Democrats, vowed his party would turn the upcoming election into "a referendum for or against increased immigration to Sweden".

Sweden was the biggest per-capita recipient of asylum seekers and refugees last year, according to the Organisation for Economic Co-operation and Development.
It is entirely possible that the instability caused by a certain blindness on the part of the main stream parties will continue after the next election. It is all a new experience for Sweden.

Some readers might like to recall what was on this blog on the subject in September.

Really worth protecting!

Today, dear readers, we go back to the House of Lords where another of this blog's favourite people, Lord Stoddart of Swindon asked a question:
To ask Her Majesty’s Government what was the total trade deficit or surplus with the European Union in goods and services between 2010 and 2013; and what is their estimate of any deficit in 2014 to date.
There are certain advantages to asking purely factual questions that cannot be twisted too much. Even Lord Livingstone's official had to come up with some figures:
UK’s trade deficit with the European Union was £28.5bn in 2010, £21.7bn in 2011, £39.5bn in 2012 and £56.2bn in 2013. Currently, UK trade balance figures cover the period up to the second quarter of 2014. In the first half of 2014, UK’s trade deficit with the European Union was £25.5bn.
Remember those figures next time some idiot or europhiliac (but I repeat myself) tells you how vital and important Britain's membership of the EU is to its trade with the rest of the EU.