Should we really abandon discussions of Brexit because of Russia? - 1

On Tuesday evening I attended an event organized by the Foreign Policy Centre (partner: the European Commission) at which they launched their new publication, Trouble in the Neighbourhood? The Future of the EU's Eastern Partnership. There is a good deal to say about the publication but in this posting I want to concentrate on something that came up during the panel presentation and discussion (all of which was about forty minutes too long).

But first: we have yet another agreement between Ukraine, Russia and, to represent the EU and the West in general, Germany and France (I'll come to that later on). The agreement, though arrived at after an all-night sitting, does not seem to be that different from the one signed in September, which was broken within hours.

As Baroness Falkner of Margravine said in the debate that followed the Statement on Ukraine in the House of Lords, also on Tuesday:

Does my noble friend accept that in the unlikely circumstance that we have progress in Minsk tomorrow and that Mr Putin sticks to his word perhaps for more than an hour or two, or even a day or week or two, the holding of any ceasefire is contingent on the verifiable force of peacekeepers?

Indeed, that debate showed that few of the peers, interested enough in the subject to participate, had any illusions about the Russian President (who continues to look ever less like a human being and ever more like somebody who could be put next to the Lenin wax work in the Mausoleum).

One of the participants in the FPC discussion was Edward Lucas of the Economist, a man who is very knowledgeable about Russia and other countries that had formerly been either in the Soviet Union or the European Communist sphere but whose great fault is inability to look beyond the European Union even though he spends a great deal of his time rightly criticizing its activity and non-achievement.

It was he who made the obvious comment that the whole idea of an Eastern Partnership was deeply flawed as it involved treating very different countries, Ukraine, Moldova, Georgia, Armenia, Azerbaijan and Belarus as being essentially similar and homogenous. This is, undoubtedly, true but the problem is that this is the only way the EU can create policies. Mr Lucas also added that "we" presumably the West but mostly "Europe", a concept that was mentioned frequently throughout the evening, have no Russia policy. Indeed not. The EU has no Russia policy just as it has no Ukraine or any other policy because it cannot have one.

This goes back to the whole problem of common foreign policy on which I have written so often that it would be impossible to link to the various postings here or on my erstwhile blogging home, EUReferendum. Foreign policy has to grow out of some definition of interest and the European Union's member states have no common interests while the Union's own interests do not extend much beyond survival and ever closer integration. (In fact, one of the member states, Greece, is an ally of the Putin government and has always been pro-Russian, regardless of what was going on.)

When I first started writing about the common foreign policy and its non-viabiltiy, all those years ago, I compared the EU to an amoeba in that its survival depended on shape changing and swallowing of organisms close to it. At the time the nascent common foreign policy consisted largely of efforts to make the neighbouring countries into member states. There could be no question of policies or relationships. If a country could not become a member then we did not know what to do with it and that, obviously, applied to Russia.

The fall of the Soviet empire presented the EU with various problems, some of which it could solve to its own temporary satisfaction by taking the Central and East European countries in, even though at least two of them, Romania and Bulgaria, remain problematic. The Balkans were and continue to be a mess despite the fact that two of the former Yugoslav republics are now within the EU and little attention was paid to the former Soviet republics except for the Baltic ones that are, as agreed by all, in a different category.

No optimistic or pessimistic analysis can possibly postulate EU membership for any of the countries in question. Therefore, they will remain near (or relatively near) neighbours and some sort of a relationship needs to be established with them. But, not having any particular interests only general, ill-defined "values" the EU cannot do so. Therefore, it has fallen back on its past method of treating all the countries as one region and dealing with them as such. The fact that this method has been unsuccessful in the past does not seem to bother anybody. After all, argue the officials involved, what is successful? We have structures, we have conferences, committees, reports and funds for managing certain problems. What else do we need for success? The fact that we cannot cope and are not set up to cope with the huge crises in the various countries, let alone the war/civil war that is going on in parts of the Ukraine remains a detail.

Mr Lucas is right to point out the faults with this sort of policy but wrong in that he cannot see that it is endemic to the political construct he has (still) such high hopes for.

[I was hoping to cover the subject in just one posting but find that it is not possible. Therefore, I shall put this up on the blog and continue in a second installment.]

Happy Tax Freedom Day

A day later than last year but it has arrived. Allister Heath in City AM analyzes what that means:

For an average UK resident, the entirety of January, February, March and April, and virtually all of May, went on part-financing the state – the first 150 days of the year. It is only money earned from today that is retained by families to spend as they see fit.

The budget deficit is primarily a form of deferred taxation – and if the government were running a balanced budget, tax freedom day would actually fall on 13 July. As the economist Gabriel Stein argues, the government will spend the equivalent of all of the income generated by the economy for the first 196 days of the year. So much for the supposedly savage cuts to public spending from the coalition – and tragically, even though expenditure remains so high, parts of the public sector, including the NHS, are nearing crisis again. The system is bust, and needs radical structural change.

It always seems to me rather odd that whenever a tax cut is contemplated by people who believe on the basis of historic evidence that lower taxes help the economy to grow, there are immediate discussions as to where the missing money will have to come from. Which other tax is to be raised? Is it not time to start wondering why exactly does the government need all this money? What is it doing with it and should we be assuming that the government is the right organization to be doing all that is now assumed to be its responsibility. Again, historic and present data would indicate that it is not.

Allister Heath's article ends with the words:

Taxes are too high, and yet Britain’s welfare state is in crisis. We need to face up to this lethal dichotomy, and start to think the unthinkable.

Indeed.

A moral duty?

So, according to much (though not all) of the media and a supposedly Conservative Chancellor of the Exchequer we all have a moral duty to pay "our fair share" of the tax. Oh really? And who exactly decides what a fair share is? Whose fault is it that the level of taxation is so high that people and companies who earn a lot by contributing a great deal to the economy are fleeing the country? Whose fault is it that the whole system is complicated to the point of complete incomprhension with endless additions here and there that allow, nay, encourage tax avoidance?

As for the media and the many vox pop comments on the subject, one begins to despair. No, not begins - one despairs completely and utterly.

It appears that there is no clear distinction in people's minds between tax avoidance (completely legal and one anyone who has an ISA or a complex pension arrangement is taking part in) and tax evasion (illegal but one many people indulge in whenever they pay in cash to avoid VAT). It, furthermore, appears that people have no ability to grasp the similarity between international companies choosing the country with the best tax system in which to pay tax and them choosing the best ISA or pension fund. The words "international" and "company" act as a red rag and all ability to think disappears. Finally, it would appear that having read about arrangements to pay low or no corporation tax, journalists, politicians and others who express opinion, assume that it means no tax at all being paid. No National Insurance, income tax, VAT, business rate. Nothing.

It is such a relief to be able to read a sensible analysis of the issue on the Adam Smith Institution blog. I recommend it to anyone whose blood pressure is going through the ceiling. Happily, I am genetically predisposed towards low blood pressure. Otherwise, I would have had to abandon politics a long time ago.

A website recommended to all

A day or so ago I attended a talk given by David Hart of Liberty Fund about the great French liberal (in the real sense of the word) economic thinker, Frédéric Bastiat, who remains less well known in the land of his birth than in the United States or even in Britain. In France there is a widespread assumption that more or less liberal and free-market ideas come from the despised Anglo-Saxes and no understanding that throughout the nineteenth century French thinking on the subject was probably wider and more profound than its British equivalent.

The talk was a lot of fun, delivered with great verve by a man whose knowledge of the subject is exhaustive but who remains excited about all its aspects. He also reminded us that Liberty Fund publishes on line and for free a large number of classical texts of liberal thought. I am hereby linking to that and shall put it on my website list.

Well, what is democracy?

A blog by Dr Eamonn Butler on the Adam Smith Institute site raises some very pertinent questions. Is democracy really just mob rule by a majority, however acquired, against any minority it happens to dislike? I seem to recall the question coming up when the Labour government gleefully announced in effect that it had a majority and therefore could go after a minority it disliked, that is people who hunted.

There are other cases, as Dr Butler points out and these tend to be less likely to inspire indignation:

it is possible for quite small majorities to dominate the agenda. That is why we have such absurdly high tax on businesses and on people who earn a lot by creating jobs and prosperity. There are simply fewer of them than the majority, who enjoy the benefits of the taxation.

When it comes to taxation we do have only one chamber and no other control on their activity. The idea of being governed by petitions or referendums (let us not spend any time discussing the Swiss system, which is applicable to one country only, Switzerland) or, in other words, vested interests and very small majorities that are easily swayed by the news of the day is equally difficult. It is representative government we need to mend and a balance of powers we need to introduce.

It goes without saying that none of that can be done while we are inside the European Union and are governed very largely from Brussels through are so-called legislators.

We all avoid taxes (or should do)

I am happy to say that I have never seen Jimmy Carr do his comedian act but, I understand, it is the usual "let's bash the bankers and rich people and anyone who is not part of the trendy left" variety. Indeed, a number of people I know have expressed some surprise that he is described as a comedian at all. But I digress.

The problem with Carr is two-fold: he has avoided taxes (a completely legal and, indeed, legitimate) action and he has done so after making all sorts of nasty sneering attacks on bankers and their like who avoid taxes. In this, Mr Carr is no different from Comrade Livingstone who was caught out during the Mayoral election campaign. That sort of hypocrisy, not exactly unknown among the Left, makes one laugh helplessly.

On the other hand, the idea of a Conservative Prime Minister calling the actual tax avoidance not the hypocrisy immoral is only funny to those of us who never believed in the Boy-King's credentials as a true conservative. He is a big-statist and a man who believes in high taxes because he believes that people should have their lives run by the state and not have the choice to do what they want with their money. His Chancellor, a disaster if ever there was one, is endlessly thinking of schemes that might get rid of  legitimate tax avoidance or allows people to decide to give their money to charity, as it were, or to spend it on their children's education. Then Georgy-Porgy has to retract or do a U-turn.

The truth is that we all avoid taxes if we can. Every time we buy ISAs or look for a savings account that pays less tax we are doing just that and, indeed, we should be. There is nothing immoral in it. It is highly moral not to give more money than is absolutely necessary to the state to squander on huge pharaonic projects as well as regulatory disasters (just to name two things the state does). Let us not even consider how many of us pay cash for work rendered because that is the only way to avoid huge amounts of bureaucracy as well as evade VAT.

Here is a highly entertaining article by Mark Littlewood, Director of the IEA, on how he avoids tax, though he does admit sheepishly that he is not as good at it as Jimmy Carr. Though, I suspect Mr Littlewood is not about to cave in publicly on the subject. I also suspect that when the hue and cry dies down, Mr Carr will go back to using whatever scheme saves him more money.

And the solution: well how about a less complicated system of lower taxes? Could that be achieved? The Taxpayers' Alliance has produced a report, which suggests that it is possible to do so. Of course, we do need a government that believes in low taxation and small state. Not sure how we are going to achieve that.

Happy Tax Freedom Day

Two days later than last year, as the Adam Smith Institute points out, but we have reached it: Happy Tax Freedom Day in the UK (it came around on the other side of the Pond a little while ago).

Tax Freedom Day falls later this year down to a number of factors. The double-dip recession, the VAT increase from last year, our high personal taxes, as well as fuel duty and stealth taxes, all mean that the government is taking a larger share of our hard-earned income. Britain’s tax burden is still too high and tax cuts are desperately needed to boost economic growth.

This year’s corporation tax receipts are a good example of how tax cuts can pay for themselves. There were large increases in tax revenue from onshore corporation tax, coinciding with the government’s cuts to the headline rate of corporation tax. Reductions in the corporation tax rate have brought the government higher revenues as more companies choose to invest in the UK. By stimulating growth and investment, tax cuts really can pay for themselves.

However, our Tax Freedom Day still falls long after the USA’s, on April 17th and Australia’s, on April 4th. Our only comfort is that our tax burden isn’t quite as high as France’s, which will have to wait until July to celebrate its own Tax Freedom Day. With Hollande now in power, that day could get even later in years to come.

There is always someone worse off than you are, as the old saying goes.

News from Italy

Not only is 2012 a year of important elections (with some results, like the Russian presidential one, entirely predictable) but May will see a number of them. May 6 will be the date of the Greek election, which is likely to result, I am told by one friend and blog reader, in the old coalition cobbling together another government of not dissimilar kind; it will also be the day on which the French President will be chosen; and in Italy there will be local elections, also on May 6 and 7, in which around 11 million voters, or a quarter of the whole, will be expressing their opinions on what has been going on.

The Centre for Policy Studies has an interesting blog post up on the subject, the first of quarterly updates on Italian poliitics by the Centro Einaudi. Little of it is unexpected even to those who have followed events from a distance but it is always good to read analyses from insiders. Here is a brief account of Mario Monti's government, its initial popularity, which might come as a surprise to some rather hysterical eurosceptics, and the gradual loss of that popularity as some very necessary reforms were enacted.

The new government’s first decision was to enact a bill on pension reform, which was immediately passed by the Chambers. As a result, the Italian pension system, one of the biggest drains on public finance, was put under control, providing automatic adjustment not only to economic growth (and, by the same token, to fiscal revenues) but also to population ageing. However, with the pension reform came a swathe of new taxes on property and income, and a VAT rise.

In the weeks that followed, the tensions on the financial markets eased, while the opinion polls suggested that Mr. Monti enjoyed wide support. Buoyed by this, the Cabinet then started to implement the recommendations to the Italian government specified by the ECB in August 2011 and reinforced by the EU Commission President, Olli Rehn, in November 2011: these required not only the reform of the pension system but also a number of measures of privatisation and liberalisation, particularly of the labour market.

It was then that the honeymoon between the government and its multi-coloured majority ended: while the centre-right objected to measures directed at liberalizing professions (such as notaries, lawyers, chemists, taxi-drivers, etc.), the centre-left found it almost impossible to accept an easing of the hire-and-fire rules on the labour market, strongly opposed by the leftist CGIL union. The result was a much watered-down ‘liberalisation’ law and an impasse on the labour-reform bill.

In the meantime, Mr. Monti tried to soften the German stance on fiscal rigour and the introduction of Eurobonds: but these attempts, which for a few weeks at the turn of the year had looked almost successful, appeared at last to have failed. The tensions on the financial markets rose again, with the spread on the Italian public debt climbing up and the Italian stock exchange losing all the gains it had accumulated in the first weeks of the year.

It is particularly interesting to note that the centre-right objected to the liberalization of professions and the centre-left to the liberalization of the labour market - a neat summary of the difference between the two in Italy (and a number of other Continental countries) or, in other words, no difference at all.

Makes sense to the BBC

In BBC-speak people who consider that they and others should look after themselves and their families whenever possible and help other people in their own way with their own money, if necessary, are absolutely selfish. Being unselfish is wanting to pay higher taxes (or wanting other people to pay higher taxes) that can then be used and abused by highly paid but seriously victimized officials to make people do what is good for them in the eyes of those officials. Makes some kind of a logical sense and can be the only explanation why the BBC should misrepresent the National Social Survey as Philip Booth explains. Read the whole posting.

Bail-out or default?

The Adam Smith Institute comes down on the side of default as is to be expected.

Greece was bailed out, then Ireland was bailed out, and now Portugal has been bailed out. All of these countries were made to agree fairly stringent deficit and debt reduction packages. All three face years of fiscal tightness, reduced services and living standards, and low economic growth. It is by no means certain that the populations of these democracies will tolerate this for the length of time it will require to put their affairs to rights.

There is an alternative. It is to let these countries default, offering a percentage of the debts' face value as settlement. There would be turmoil. Some bondholders, including European banks, would lose substantial sums. But at the end of it confidence would return and economies start to grow again without that burden of debt.

The decision was made to protect small depositors, bondholders and to some extent bank shareholders, at the expense of taxpayers. It was an unwise decision, both morally and from the point of view of efficiency. One could argue that small depositors were not a party to the causes of the crisis, and should not be made to bear its burdens. Bondholders and shareholders, however, should have known better.

The main argument in favour of default is that it will be effective in putting a line under the crisis. Instead of limping along for years with lacklustre economies struggling to meet debt repayments, the over-indebted countries can get it over with and turn the page.

It looks very much as if the bailout option has been taken to protect the euro and European banks, but it would not be the end of the world if a few countries that should never have been in the single currency have to leave it. And if a few European banks had to restructure, recapitalize or be taken over, this, too, could be survived. Allowing the euro to lose momentum might be a setback to European political union, but this would be no bad thing.

Makes sense to me. The euro is a political project, which was, as some French newspapers wrote at the time, supposed to demonstrate the triumph of politics over economics. Some hope!

I am a little more pessimistic than the great Eamonn Butler

Well, the government has done another U-turn, this time on the Forestry Commission, as Dr Butler says on the Adam Smith Institute site, "a conflicted quango, trying to regulate forestry while also being the sector's biggest owner, manager and producer". There will be many more.

Some people are rejoicing and pointing out that this shows the government is ready to listen to the people. Who those people are is hard to tell as they tend to be either those who are somehow going to lose their livelihood if the Forestry Commission goes or those who have not bothered to read the proposals but acquired their information from the BBC. I had an argument on the subject with someone who seemed to think that land owned by a quango is the same as common land.

What it actually shows is that the government has no particular principles and has not the first idea how they would like to see this country run; therefore, at the slightest sign of opposition they turn tail. After all, as Dr Butler says, it was obvious that old cliches would appear:

It's not too difficult to predict that the 'selling the family silver' charge is going to be hurled against any privatization (or in this case, merely leasing-out) plan. That's the statists' nuclear weapon. Most people don't realise that the family silver is already bashed and tarnished – that part of it that hasn't been stolen in a smash and grab raid by the trade unions and the officials in Whitehall who actually run things.

Nor is it particularly difficult that local authorities faced with budget cuts would take the knife to front-line services or anything that might excite opposition, like the closure of underused and understocked libraries. They are not likely to get rid of highly paid bureaucrats in the back offices, are they now? Why, precisely, did the Cleggeron Coalition or the Conservative leadership not realize this and prepare for this?

Dr Butler finishes on a surprisingly optimistic note:

I do hope this government is not going to be like Blair's, tossed on the sea of public opinion as it ditches good policies that don't go down well. My guess is that it will not, and that it has a better sense of direction as to what it wants to achieve and the difficult measures it needs to take to achieve them. But when you know you will face difficulties, you need to prepare well to get through them.

So far we have seen little evidence of that sense of direction. I am a little more pessimistic than the great Eamonn Butler.

Celebrities talk utter rot - shock

The celebs are on the warpath again and, as ever, have managed to bamboozle a few people. It's as if a stupid idea becomes less stupid if it is articulated by the likes of Dame Judi Dench (a wonderful actress but hardly a thinker) or Sir Ranulph Fiennes (also not a thinker). And, as far as this blog is concerned, anything that the ArchDruid, Dr Rowan Williams supports is ipso facto suspect. (Ha! Didn't expect that, did you?)

The matter in hand is the government's proposal to sell Britain's forests or, to be quite precise, those that belong and are administered by the ineffable quango the Forestry Commission with a bit of interference from other ministries and regulatory bodies, to private individuals, organizations, companies and, if it is right, voluntary bodies. Shock, horror! Anyone would think that the total devastation of ancient hunting forests has been proposed.

As Eamonn Butler says in today's ASI blog:

From the sound of it, you might think that Britain's forests are going to be sold off to keep Rupert Murdoch in paper, or maybe concreted over for car parking. Hardly. State forestry is a mess, and private ownership will revitalize it, and will actually extend the public amenity that our forests afford us. Private owners are actually more likely to encourage public access than the Commission has been – they can see more commercial potential in doing precisely that.

The Forestry Commission already plans to sell small bits of its forest estate, which will earn taxpayers a useful £100m. The question mooted by the government today is whether it should sell the whole lot. That's actually no really big deal. The Commission owns only a fifth of England's forest land. Most of the rest, about 68%, is already in private hands. (Various government departments, like Defence, own other bits too.) Many of the celebs who are saying how much they love forests could well be thinking about ones that are already private.

And private forestry is already heavily regulated in terms of the owners' obligations to the protection of nature, logging schedules, public access, and development. Thos protections would remain, even if the whole estate were sold. And indeed there would be extra protections for ancient woodlands like the Dean, New, and Sherwood forests. As in New Zealand and other countries, there could be a mixture of commercial, non-profit, community and mixed ownership.

In a previous blog Dr Butler referred to the various celebs who had signed a sobbing letter to the Sunday Telegraph as being "thick as two short planks" an obvious but still accurate description. Furthermore, he gives very good reasons why we should not assume that the celebs in question actually know what they are talking about. In this blog's opinion, a period of silence from all of them starting with His Bloviation, Dr Williams, would be very welcome.

Tax Freedom Day 2011

An e-mail from the Adam Smith Institute tells us that Tax Freedom Day 2011

"falls on 30 May this year. That's three days later than last year, thanks almost entirely to the rise in VAT. It's now up to 20p in the £. Thinking about it, 20p in the pound seems to be roughly what we're left with after the government's had its slice. Wouldn't it be nice to have a government that lived within its means, not yours?"

The trouble with governments and politicians that they do not have a clear idea of the difference between meum and tuum. Bring back classical education, say I.

How do I get a job like this?

International Relations and Security Network (ISN) a highly regarded think-tank in Zurich has put up a piece about the ongoing OSCE Summit in Kazakhstan. Solemnly it tells us that there are differences between all the members that appear to be irreconcilable.

I'll say there are differences. The President of Kazakhstan talked of a need for another reserve currency in the world without specifying which; Secretary of State Clinton called on the organization to take a greater share in matters of security in the area including Afghanistan, without specifying how they were to do that; President Medvedev huffed and puffed at the very idea of force being used, something that Russia would never dream of doing; and Nick Clegg who was despatched instead of William Hague, spoke about the need for human rights in all OSCE members. And that was just the first day.

It so happens that yesterday I took part in a discussion on the OSCE and its future with two experts, one from Russia, one from Kazakhstan on the BBC Russian Service. Not one of us thought that there was going to be any kind of a break-through for the OSCE in this Summit though the chap from Kazakhstan thought that the country and its leader had got a good deal of kudos from the meeting and, anyway, having a forum in which all these people can meet and talk was quite a good thing. He did not specify in what way it was a better thing than more low-key negotiations between two or more countries.

The Russian expert droned about the pointlessness of OSCE, citing its history of non-achievement and generally expressing the view that such disparate countries cannot achieve much in the same organization. He was going to go on to the subject of UN and the pointlessness of having members like Burundi in it but was interrupted by the programme anchor.

I was then asked my opinion on OSCE's present and future. Unusually, I agreed with the other participants. There will be no break-through and, in any case, nobody knows what sort of breakthrough is needed or wanted. After all, even Clinton and Clegg were talking about two completely different aims, never mind everyone else. But there is, I added, an inertia about all international and transnational organizations. Once they exist they just go on existing. Partly, there are too many people who have a vested interest in their continued existence but largely it is the unthinkability of somebody standing up and saying: the OSCE has never achieved anything and will never achieve anything. Let's disband it. But think how useful that would be.

There are now only two questions to ask. First is why on earth did we send Nick Clegg to Kazakhstan? The second is how do I get a well-paid job with some think-tank to write solemn articles about the bleedin' obvious.

More on those Leaks

This morning there was another item from the department of the bleedin' obvious in the WikiLeaks saga: Putin might well have known about the plot to assassinate Alexander Litvinenko. In fact, he probably did know. Gosh, I thought, not really! Then I thought: has Julian Assange actually got round to publishing Russian cables. He'd better look out then. But, of course, nothing of the kind.

Senior American officials believed Russian prime minister Vladimir Putin may well have known about the operation to murder dissident former spy Alexander Litvinenko in London, according to leaked US diplomatic cables.

Washington's senior diplomat in Europe challenged suggestions that the killing could have been the work of "rogue elements" in the Russian security forces, according to the latest documents posted on the WikiLeaks website.

Assistant secretary of state Daniel Fried said that Mr Putin's attention to detail meant that it would have been difficult for such an operation to be carried out without his knowledge.

We are still in the realm of American State Department cables, acquired by Mr Assange with very little difficulty or danger.

As an article on the Henry Jackson Society site that also appeared in the Daily Telegraph, says:

If Assange is genuinely committed to shining light into the darkness, and exposing real corruption and human rights abuse, we must ask ourselves, where are the ‘Chinese Embassy Cables’? What has become of the ‘Iran Files’? Whither the ‘Chechnya War Logs’?


It is very important to make the distinction between the latest leaks about Russian corruption under Putin, which are allegations taken from Western sources, and the kind of revelations that would be truly devastating to the Kremlin's credibility: damaging revelations, in other words, from Russian state sources. This we have yet to see, and are unlikely to anytime soon.

The point is that Assange has made grandiloquent claims for his activity, quoted in the same article:

Speaking at a dinner of the Oslo Freedom Forum in April this year, Assange eloquently countered claims that he is anti-Western. On the contrary, he said, he is very much pro-Western. The object of his chagrin is not the West but its leaders, who have distorted and corrupted Western values for their own nefarious ends, and he – like all good revolutionaries – is out to claim those values back.

“The United States”, he said, “once had a proud tradition of freedom of the press... [but] when we see the path that [it is now] going down, we have to question whether it is really holding those values anymore”. The United Kingdom is no better, he says. 300 gag orders in force at any one time make a mockery of the notion of a British free press.

So far from the Enlightenment path has the West apparently strayed in its obsession with secrecy and perversion of justice that Assange now likens it to the Soviet Union in the era of Stalin and Solzhenitsyn. He speaks of an ‘Orwellian’ atmosphere of information control, and a muted media made incapable of speaking out.

Confronted by this nightmare, Assange’s duty is clear: “We have become the publisher of last resort... And in that endeavour [we have] been successful in putting over a million restricted documents into the historical record that weren’t there before. That’s more pages of information than is in Wikipedia.”

One's immediate reaction is that this man either knows nothing about Stalin's Soviet Union or is a liar of monumental proportions.

It is, nevertheless, true: if he really cares about freedom, transparency and human rights then he should start looking at some other countries that are somewhat more deficient in those than the West with all its undoubted problems.

It may well be that Assange – who claims that the ‘exponential’ increase in leaks to his site has forced him to refuse further submissions – has received nothing from any of these potential sources.

If that is the case, this in itself says something quite significant. Private Bradley Manning, the US soldier suspected of the latest leaks, can be confident that the worst punishment he will receive for his crime is a jail term if found guilty. Dissidents in the kinds of countries where Assange should be focusing his efforts could never be so certain. A bullet in the head for themselves and their families – no trial – would be the almost inevitable consequence. Small wonder there aren’t many leaks coming out of the Russian embassy or the Chinese mission.

The second answer to this question could just as easily be, however, that Assange is not really all that interested in exposing corruption and human rights abuse at all, rather his objective is to embarrass and weaken the US and its Western allies because he hates them for what they are and what they stand for. How many of the ‘US Embassy Cables’ reveal actual crimes? Sure, Prince Andrew’s comments about the Serious Fraud Office are unpleasant; certainly the revelation that the US Embassy in Paris sent a memo describing Nicholas Sarkozy as ‘thin-skinned and authoritarian’ is a bit embarrassing, but the majority of these leaks can be filed under the category ‘political titillation’ not ‘serious breaches of the law’.

Some of these leaks, however, are much more serious. Many contain highly sensitive information, the exposure of which will unquestionably do more harm than good to the kind of causes Assange claims he espouses. The fact that China may have been secretly communicating its intention to withdraw its support for North Korea, one of the most repressive and murderous regimes on earth, is enormously significant; the fact that Wikileaks has just made that information public will probably set this process back by several years. The revelation, if it can be described as such, that Iran’s Arab neighbours are so concerned about its nuclear ambitions that they are ready to support US-led military action against Tehran will only give an already paranoid President Ahmadinejad further cause to intensify the oppression of ethnic groups within Iran that he suspects of subversive activity.

Finally of course, all those would-be whistleblowers in countries where real corruption and human rights abuse take place will be vastly less inclined to share that information now than they otherwise would have been. If Julian Assange really wanted to encourage whistleblowing about issues that genuinely impact on human lives, instead of just weakening and embarrassing the United States, he would not be so reckless. Of course, the truth of the matter is that this doesn’t really seem to be his objective at all.

And all this time Julian Assange is staying in hiding because the Swedish police want to interview him in connection with a rape accusation.

Somebody is saying it

Inevitably it is the Adam Smith Institute that is saying the obvious: cuts do not help until there is some discussion on what the government should or should not do.

Closing quangos or primary care trusts and transferring their work to departments and doctors’ practices respectively will achieve nothing unless the work itself is also eliminated. A dead giveaway is the phrase “working with”. The people being worked with may well be grateful not to be worked with. The Eastern Strategic Health Authority claims to “work with” 46 other NHS bodies.

Rolling back government should be about reducing what government does first and worrying about headcount and savings second.

However, the somewhat laboured metaphor of the three brown envelopes and new management in some private firm or other is too long and not entirely accurate. In fact, one cannot help wondering how much experience Tim Ambler has had in the business part of the private sector.

But I especially disagree with this fatuous comment:

The leaders of the Coalition are exceptionally bright and talented but, Ken Clark aside, have little relevant experience from commerce or government.

Just what evidence is there that they are exceptionally bright and talented if they have no experience in anything of any importance?

They are right

It will not surprise readers of this blog to find out that I tend to agree more with the other side than with the rather wishy-washy, supposed allies such as the so-called Conservative eurosceptics. The Centre for European Reform, an organization that used to be a kind Gorbachev type reformers of the European Union are people who speak the same language as the real eurosceptics. In fact, they have long ago abandoned their perestroika credentials, leaving them to Open Europe and New Direction.

CER has a blog of varying interest but it is always useful to read their postings to find out what the europhiliac agenda is or to have it confirmed. Here is the entry on the Strategic Defence and Security Review. No messing around here. Clara Marina O'Donnell goes straight for the important question: is this good for European defence integration?

After the usual blah about pragmatism being europhiliac whereas euroscepticism that points to the various problems in the whole concept of European defence integration being sectarian, extremist and generally reprehensible, we get to the meat.

The coalition government's plan to work more closely with its allies is both positive and long overdue. For decades, Britain and other European countries have wasted a lot of money by duplicating the development of military equipment. Depending on the outcome of the Franco-British summit, the new UK government might go further in promoting the cause of European defence co-operation than any of its predecessors.

But London must invest the same political energy it has devoted to France towards exploring additional savings with other European countries. In the SDSR, the government opens the possibility of closer defence co-operation with Germany, Italy, the Netherlands and Spain. But other countries could also offer niche savings, including Poland and Sweden which have shown a keen interest in improving their military capabilities in recent years. The UK should also actively encourage its European allies to strengthen co-operation amongst themselves. As Britain's own military preparedness diminishes, it has a greater interest in other European countries taking up the slack.

The second piece of good news in the SDSR is the rather constructive attitude of the UK towards EU defence co-operation. Before the general election last spring, key members of the Conservative party – in particular William Hague, now the Foreign Secretary, and Liam Fox, now in charge of defence – voiced serious reservations about EU efforts in defence. Liam Fox worried that federalists within the EU were trying to develop a European army. He openly opposed some of the steps towards a stronger EU foreign policy foreseen in the Lisbon treaty. And he was keen to withdraw the UK from the European Defence Agency, a body which encourages common efforts amongst EU countries in developing defence capabilities.

Just one problem with the whole notion and Ms O'Donnell does not deal with it: exactly what will be the purpose of a not very advanced integrated European defence force?

No, I fear this is not the right way either

One of the least likely stories about the young Vladimir Ulyanov (later to be known as Lenin) is that when he, at the age of 17, heard of the execution of his older brother Alexander for the attempted assassination of the Tsar, said "Мы пойдём иным путём" ("We shall take another road"), thus signifying his early understanding of the need for a class revolution as opposed to mere assassination.

There are many things wrong with that tale, dutifully learnt and repeated by every school child within the Communist system, not least the problem of the recipient of the confidence. Lenin's father was dead, his mother in St Petersburg hoping to intercede for her son, his older sister Anna in prison for her marginal involvement in the conspiracy. Possibly he said it to the servants or his younger siblings.

It is, nevertheless, a good story and one I recall every so often, particularly when faced with yet another book, speaker, organization or think-tank that promises to produce ideas for reforming the European Union and setting it on a different path.

Unlike the Boss of EUReferendum I try not to attack a new venture before going to the launch and chatting to people there. Afterwards it is a different tale. So, I went to the launch of New Direction yesterday, held rather grandly (well, it is the Toy Parliament's money, after all) in the Chartered Accountants' Hall in the City.

My intention was to listen to the presentations and ask a few straightforward questions. Well, one would have done. However, once I realized that the guest of honour was going to be Lady Thatcher I knew there would be no questions, let alone answers. She did not speak but spent some time chatting to her admirers and being photographed with them and by them. So, no blame can be attached to her.

I do, however, think that if you are in the business of trying to convince or convert people Liam Fox may not be the best choice for main speaker. Not to put too fine a point on it, the man is dull and verbose. He droned on and on, mentioning that this was "new thinking" and "new ideas" and "new directions" in every sentence. (Well, in every sentence I actually managed to listen to. Someone else told me he switched off after the first two so I did better.) Apparently Europe needs to change directions if it wants to remain of any importance in the globalized world; also we must remember that the best way forward is through national sovereign states so the trend towards integration and centralization must stop; furthermore Europe must spend more on defence if it wants to count in the world (no, don't bother to work that one out); in short, we cannot go on like this and we need new ideas, which, fortunately are going to be provided by the new think-tank which is (as they dutifully point out on their website) largely funded by the Toy Parliament. It was quite a relief when he finished, especially as it was not possible to ask the obvious question: Well, what are you going to DO about it all, Mr Fox?

We had already been informed by Mr Geoffrey Van Orden, President of New Direction that what we needed was fresh thinking and new ideas and wasn't it terrible how much money we had to pay over to the European Union. Anyone would think that if we paid over less the whole idea would become more acceptable. Also, Mr Van Orden informed us, the European Parliament is going to cost more in the coming year than at any time before. Well, I have an answer to that but I doubt if Mr Van Orden will like it.

There is a list of research topics that the New Direction will take on. There is one missing: an analysis of how the European Union is structured and how it legislates. Were they to understand that they might just begin to work out that no amount of so-called new ideas will reform this sclerotic organization. Nor will its direction change just because Mr Van Orden or Mr Fox or Mr Shane Frith says that it would be a good idea.

Мы пойдём иным путём.

Well this is exciting! Or not.

For some time now the Boss at EUReferendum and I have been a little puzzled by the fact that various organizations close to the Conservative Party (now a member of the Clegeron Coalition) but pretending to be somewhat rebellious, have been talking about a coming IGC that would trigger off a referendum and then we shall see the Boy-King's mettle. (And no, they do not refer to him as the Boy-King but we do.)

An IGC? An Inter-Governmental Conference with all the grandiose trappings for which there are certain rules and which will produce a new treaty that should already have been more or less written and discussed with the Spanish Prime Minister (of the outgoing Presidency) rushing around the other capitals? This is a big event or ought to be. How on earth did we and, indeed, just about everybody else outside the above-mentioned organizations managed to miss it?

Phew! I have now found what all the excitement was about. It seems that on Wednesday there will be a meeting of the Permanent Representatives (or, in other words, not government leaders) to finalize certain arrangements for the Toy Parliament that had been more or less agreed on before.

It was decided to discuss those amendments without calling a Convention or add any of the grand trappings. Indeed, as an Inter-Governmental Conference is is decidedly a damp squib. Perhaps COREPER now feels that they are the real representatives of the various governments not the various Ministers, Prime Ministers or Presidents.

My guess is that this Amendment will be passed without any difficulty through Parliament. It seems unlikely that the Boy-King will consider a bickering about how many representatives there should be in the Toy Parliament a matter of such importance as to give even an ordinary, let alone a cast-iron guarantee of a referendum.

Some radical ideas

One of the few think-tanks in this country that produces worthwhile material is Reform. In anticipation of next week's Budget they have produced their own ideas that, sadly, would require a great deal more courage and imagination than the Coalition has displayed so far. I keep being told that I should give Cameron a chance (though nobody has yet suggested that I should give Osborne a chance) so, maybe, we should wait till next week.

In the meantime here is the alternative Budget in full.