Nabucco is no more

Pending Azerbaijan's official announcement on Friday, we can say that the Nabucco pipeline, intended to lessen certain EU member states' reliance on Russian gas, is no more.

EUObserver reports that Austrian firm OMV, part of the Nabucco consortium, said on Wednesday (26 June) that Azerbaijan, the gas supplier, has opted for the rival "Tap" pipeline instead.

"[Azerbaijan's] Shah Deniz II consortium informed OMV, as a shareholder of Nabucco Gas Pipeline International, about the decision on their preferred gas transportation route to Europe. The Nabucco West project was not selected by the consortium," it noted on its website.

While Tap is also intended to bring "10 billion cubic metres (bcm) of gas a year from the Caspian region to EU countries in the next five or so years to Europe" by-passing Russia, it is less useful.

Tap is to run from the Turkish border via Greece, Albania and the Adriatic Sea, to Italy. Nabucco West was to have run from Turkey via Bulgaria, Romania and Hungary, to Austria.

Greece depends on Russian gas for 58 percent of consumption, while Italy's dependence is just 22 percent.

Neither country was badly hit in the 2008/2009 Russia-Ukraine gas crisis.

But in Bulgaria, which depends on Russia 100 percent, street lights went out in Sofia and electricity supplies to hospitals were put at risk. Dependency is also high in Hungary (56%) and Austria (52%).

If these plans go ahead certain countries will remain vulnerable to Russian pressure and, not to put too fine a point on it, blackmail. On the other hand, of course, Russia badly needs to sell its gas as its income relies almost entirely on raw produce like gas and oil.

Then again, President Ilhan Aliyev of Azerbaijan is no slouch when it comes to using the country's gas reserves to extract various concessions from the EU (though he is less likely to start putting pressures on individual member states) and is said to be delaying signing the Tap agreement till the autumn, that is the next presidential elections.

Interim Czech Prime Minister appointed

After the scandalous resignation of the Czech Prime Minister the President and well known alcoholic, Miloš Zeman, had to look around for an interim government leader. He has now found one:

President Miloš Zeman has appointed economist Jiří Rusnok to succeed Petr Nečas as prime minister of the Czech Republic. Mr. Rusnok, who is 52 and was finance minister under then PM Zeman for just over a year in the early 2000s, will head a caretaker cabinet.

This seems to be following a certain fashion in European countries for "technocrat" governments that appear to be no more successful than political ones. So far as anyone can tell neither the left nor the right in the Czech Chamber of Deputies is happy with the choice.

Anniversaries

I tend to save anniversaries for another blog but there are two today that are important to the way we see the world and they have to be mentioned.

It is 110 years since the birth of George Orwell, the man who defined much of our modern political thinking (what had been left undefined by Dostoyevsky) and whose ability to grasp political reality despite his left-wing socialist outlook, remains unrivalled. Happy Birthday Eric Blair/George Orwell.

It is 63 years since North Korea invaded South Korea, thus pushing into the open what had been in the shadows: the new world division after 1945 between the West and Communism. The invasion would not have happened if Stalin did not feel reasonably secure because extensive Soviet espionage had given him an ability to rival the United States in the nuclear race; and the war might not have happened if the Soviet Union had not, temporarily, vacated its seat in the UN Security Council, thus allowing that organization to take the one and only sensible decision in its entire history.

Referendum Bill presented

James Whalley, who, astonishingly, drew first place in the ballot for Private Members' Bills presented his European Union (Referendum) Bill 2013 -2014 yesterday to the House for its First Reading, which is really just a formality. Second Reading is scheduled for July 5, a Friday as Private Members' Bills are debated on that day.

In the meantime there has been a certain amount of displacement activity going on. As ever it relies on the stupendous ignorance most eurosceptics display about the British Constitution. Benedict Brogan talks portentously about what will happen next but only the very ignorant will be surprised by his article. What happens next is exactly what happens with all Bills.

The Express thinks that this takes us closer to "free Britain", which is nonsensical. It takes closer, possibly, to having a referendum some time in the future, assuming nothing much of importance happens in the meantime in the European Union but, as we know or ought to know, having a referendum is not the same as voting to get out or even knowing how we get out. The present state of popular opinion would indicate that the stayers-in will win with no great difficulty.

The biggest of all attempts at displacement activity is the invitation by "Grant Shapps and/or some clever boffin at CCHQ" to invite you, me and everyone else to co-sponsor the Bill. The way to do it is to click on to the right page on Facebook and put your signature to the Bill. There is just one minor problem with this. Oh, a very unimportant problem but I do think someone needs to mention it. A Bill is sponsored by members of the House of Commons or the House of Lords, depending on where it starts. This one is starting in the Lower House and has been co-sponsored by a number of MPs, not all of whom can be called eurosceptic. Members of the public do not sponsor Bills. Putting your name on that page may give you a warm fuzzy feeling of doing something but it is a pointless exercise. 

Iceland definitely not coming in

Earlier this month EUObserver reported a speech by the President of Iceland, Ólafur Ragnar Grímsson, in which he cast yet more doubt on the idea that Iceland will join the European Union in the foreseeable (or, indeed, less foreseeable) future.

The European Union is not "greatly interested" in concluding negotiations with Iceland in the next few years, president Ólafur Ragnar Grímsson told parliament Thursday. Brussels doesn't want to risk a rejection in a referendum and is unlikely to develop a permanent fisheries policy that Iceland could accept, he said.

Here is the speech delivered to the Icelandic Parliament, the Althingi, on June 6, in full (and in English). Among other things to do with the Constitution of Iceland, its history and continuing importance, the President said:

After the turmoil of the past few years, the Constitution of our Republic is once again firmly in place; the will of the people as the driving force for action and determining the preservation of elements of supreme importance.

The general election delivered important messages regarding the Constitution and also on the future of our sovereignty. A strong majority of the newly-elected parliament is bound by the promise that Iceland will stand outside the European Union and the issue will be placed in the hands of the people.

In a way it was natural, four years ago when ominous uncertainty loomed over our economy and that of the Western world, that the Althingi should see the attractions of opening membership negotiations with the European Union, particularly with regard to the euro, which then seemed to rest on strong foundations; but now we face a different reality. No one knows along what lines the European Union may develop, and the euro zone is mired in a deeper recession than the economies of Northern Europe, America and Asia.

Moreover, the European Union’s negotiations with Iceland have gone very slowly. Already they have lasted longer than when other Nordic EFTA states – Sweden and Finland – made their approaches on membership. The last 3 parliamentary term came to an end before the negotiators had started to examine those aspects of the application that are of central importance for Iceland.

The way events have unfolded, and also my discussions with many influential people in Europe, have convinced me that notwithstanding its friendly declarations, the European Union is not in fact greatly interested in concluding negotiations with us in the next few years.

Although I have been told by representatives of Open Europe that Iceland is clearly looking for a better deal just as Britain is in her "renegotiations", it seems to me that the President was clear in his statement as the people of Iceland had been in the way they had cast their votes. (Yes, I did try to explain yet again to Open Europe that the position of a country that is outside the EU is different from the one inside but I am not sure whether they bothered to listen.)

Yesterday's news is even less equivocal.

Iceland has decided to end its bid to join the European Union (EU). The news was announced by the country's foreign minister, Gunnar Bragi Sveinsson, to the European Commission.

"This is how democracy works," said the minister three weeks after being appointed to the recently elected Icelandic government.

He stated that both parties in the new Icelandic government had fought the idea of EU accession.

In fact, the European Commission was told this on June 13  and took it badly. Well, one member of it took it badly.

Speaking during a frosty press conference with reporters on Thursday (13 June), Stefan Fule, the Czech commissioner responsible for EU membership bids, admitted that Iceland's decision was a personal blow.

"It was not easy for me as a person (to take the decision)," said Fule. But he added: "I am also a professional and I respect without any questions and any doubt, the will of elected representative and citizens".

He also maintained that talks on Iceland's accession to the EU should still be completed. "We remain fully committed to continuing and completing the process."

That would be the process Iceland has just aborted. What exactly is the EU going to continue and complete?

For those who want to read the words of freedom, here is the speech given by Sigmundur David Gunnlaugsson, the Prime Minister of Iceland on June 17, the country's National Day.

Czech Prime Minister resigns

Yet another scandal in the Czech Republic and it comes at a difficult time as the country's economy is rather shaky. Well, whose isn't? The eurozone is its biggest market and the eurozone is not doing terribly well. According to the Wall Street Journal [you can get round the pay wall by putting the title of the article into Google]

Prime Minister Petr Necas, who has been in office three years, handed in his resignation to President Milos Zeman days after his chief of staff, Jana Nagyova, was arrested on criminal charges, including allegedly ordering military intelligence to spy on Mr. Necas's wife.

Election is due next year and the President seems to have decided to wait for the right time and to appoint an interim Prime Minister. In the meantime he has asked Mr Necas to carry on as acting Prime Minister. The chances are that it will be a member of the Civic Democratic Party who will be asked to form the government.

So what is the scandal about this time? Largely about an abuse-of-power enquiry that involves Mr Necas's Chief of Staff, Jana Nagyova.

Ms. Nagyova was charged with abuse of power in connection with what prosecutors said was an unsanctioned use of the country's military-intelligence agency. She appeared in court on Saturday and was ordered held in custody as the investigation continues.

Prosecutors said she also allegedly helped bribe three ruling-party lawmakers—who were also arrested—to drop their rebellion against Mr. Necas in Parliament last year in exchange for jobs in state-run companies.

Her lawyer, Eduard Bruna, said she denied all the charges. He said Ms. Nagyova had sought to protect Radka Necasova, the prime minister's wife, and others from potential security threats, allegedly involving attempts by members of Jehovah's Witnesses, a Christian denomination, to contact Ms. Necasova.

Jehovah's Witnesses? I know they can be something of a nuisance but a security threat? Really, Ms Nagyova ought to have been sacked long ago for complete lack of imagination. Dariusz Kałan gives the background to the latest manifestation of Czech power politics in EUObserver. I shall give him the benefit of the doubt and assume that he was not the one to come up with that daft headline: Czech Watergate: All the Prime Minister's Women.

A political earthquake struck the Czech republic on Thursday night (13 June) directly after Prime Minister Petr Necas' cabinet meeting.

Following raids on government and company offices across the country, police detained seven people, including senior MPs in the ruling Civic Democratic Party (ODS), top military intelligence officers Jana Nagyova, the PM's chief of staff and long-term personal assistant.

They also seized the equivalent of nearly €6 million in cash and several kilos of gold.

The article suggests that the best of the story is yet to come though, for the time being, Mr Necas himself is seen as "weak and wobbly" but fundamentally honest. Nevertheless, he seems to be in the midst of an acrimonious divorce and his Chief of Staff (and alleged lover) is being accused of using military intelligence to spy on his wife (in order to protect her .... see above). President Zeman, in the meantime, has been attending official ceremonies while being visibly drunk, so he has the odd PR problem or two. (Though his drinking habits are not exactly news, as this blog has mentioned before.)

Dariusz Kałan suggests an interesting scenario, which should excite people outside the Czech Republic though not, perhaps, inside it:

Only his [President Zeman's] predecessor, the 72-year-old Vaclav Klaus, who continues to cling to political ambitions despite his advanced age and unpopularity, might get a bump.

Since stepping down from office, he has been waiting for an opportunity to take back leadership of the ODS, the party which he founded.

The ODS rank and file might well see the Cold-War-era hero as the only person capable of restoring the group's credibility.

But for Czech people at large, this will have little meaning.

None of this would matter too much if it were not for the fact, which cannot be repeated often enough, that the Prime Minister of the Czech Republic is also a member of our real government.

What's in a name?

Should one refer to banking privacy or banking secrecy? One sounds rather attractive, the other evil, anti-communitarian, defiant and generally a bad thing. That is, of course, why the Swiss banking rules about clients' privacy are consistently described as banking secrecy, particularly when the industry and the country is being bullied by the United States and probably quite soon the European Union in the name of its members, who feel that people should not try to take money out of the various governments' rapacious hands.

For the time being, the Swiss are holding out and one cannot help wondering whether recent scandals around certain US institutions, such as the IRS, have not stiffened their resolve.

The news is that the lower house of the Swiss Parliament has "refused to debate a bill that would allow Swiss banks to pass client information to the US tax authorities". The Bill will now return to the Senate who had reluctantly passed it, after threats from the US that it "would indict Swiss banks, and possibly even cut them off from the dollar market" if its parliament disobeys instructions. The Swiss parliament will be rising this week for summer, so the Bill will not be discussed till the next session. If the lower house refuses to debate it again, it will die an unnatural death.

What then?

In January Switzerland's oldest private bank, Wegelin, closed after being indicted and fined $58m by the US authorities after admitting in court to helping American customers to hide more than $1.2bn from the Internal Revenue Service.

In 2009, Swiss bank UBS paid $780 million and handed over details of more than 4,000 accounts in order to avoid indictment.

That would be the Internal Revenue Service that is waging a losing fight to clear its own name and for whose abolition there are ever more calls in the United States. Let us not forget the European Union that is standing in the shadows, hoping to get a piece of the action.

It's show time

One of my favourites: Fred Astaire and Judy Garland singing and dancing about the Midnight Choo-Choo that leaves for Alabam:

Will this solve our problems?

The most recent story of MPs and, possibly, Peers (who are denying the accusations) asking questions after some money had been promised or even handed over (the stories are somewhat muddled) with Parliamentary passes being withdrawn from lobbyists by the Speaker is even more bizarre than its predecessors.

As Eamonn Butler of the Adam Smith Institute put it in his e-mail to all subscribers this morning:

Journalists trapped parliamentarians in a cash-for-influence sting. So now we're going to have a clampdown on lobbying. (Although no lobbyists were involved. Now you know how laws are made in this country.)

Quite so. This was not an example of our courageous boys and girls of the press investigating the wrong doings of our legislators but a case of said hacks and hackettes setting up a sting operation or, if you prefer, being agents provocateurs. Naturally, those being provoked by the agents should not yield to temptation but the whole story has more than a whiff of fishiness.

The government has been wanting to regulate lobbyists for some time though nobody has yet been able to demonstrate that any sort of a register or regulatory body would make the system more honest or acceptable.

The Adam Smith Institute blog summed matters up:

We have seen the result in the United States. Think-tanks carry on as before, but they have to set up a separate 'lobbyist' body comprising any of their personnel who have frequent discussions with folk on Capitol Hill. The effect is to politicise think-tanks and put a wall between their independent policy experts and the politicians. An issue comes up, a think-tank expert has important things to say, but cannot say them directly to the policymakers.

But it does give an opening to yet more bureaucratic meddling with the political process.

The government has experienced certain difficulties in passing legislation that would create new rules through Parliament. Now, if you please, we have a synthetically manufactured scandal that does not involve lobbyists but is being presented, very conveniently for the government, as an excellent reason for passing new legislation. The timing raises some questions.

Latvia is joining the eurozone

Despite obvious misgivings on the part of the population, Latvia is set to become the eighteenth member of the eurozone.

In a report, the Commission confirmed that the Baltic state had met the criteria for joining the single currency.

Officials hope the news will show the eurozone is set to grow despite a three-year sovereign debt crisis.

Latvia is keen to strengthen ties with western Europe and reduce its dependency on Russia.

One can understand why Latvia would want to reduce dependency on Russia (something the East European and Baltic states have been trying to achieve since the early nineties with variable success) but the notion that the crisis will somehow magically disappear because another country clambers onto the sinking ship seems rather doubtful.

There will be a new member in our real government

Croatia is on her way into the EU, despite the obvious problems some of the existing member states in Eastern Europe and the Balkans are having to deal with. Naturally, one of that country's representatives will be a member of our real government, to wit the Commission. Croatia will be given the Consumer Protection portfolio and discussions are going on as to who in particular should hold it.

The country's nominee is Neven Mimica, currently Deputy Prime Minister for Foreign Affairs and European Integration and a reputedly tough negotiator (though what exactly he has managed to negotiate for his country beyond accession to a wobbly enterprise is unclear). However, he made a poor impression on the MEPs who questioned him for three hours yesterday.

He pledged to focus on enforcing current legislation, seeking earlier and deeper involvement of stakeholders in the legislative process, and consolidating the legal framework of European consumer policy.

The centre-right European People’s Party (EPP), the largest political group in Parliament, labelled his answers “too vague”, demanding a follow up.

“Neven Mimica has proven to be a serious person but he must catch up with the [Parliament’s] claim for the enforcement of concrete EU laws. Before being confirmed as a European Commissioner he must respond more concretely to MEPs’ questions,” said German MEP Andreas Schwab, EPP member of the Parliament's internal market and consumer protection committee.

Mr Mimica, on the other hand, thought it all went rather well.

Latvians show reluctance to join the euro

The Wall Street Journal thinks this reflects "Ambiguity Over Euro":

Political parties in Latvia skeptical of joining the euro zone next year took the bulk of the votes in the capital in local elections Saturday, heightening the view that many here still don't support joining the bloc.

I'd say it reflects some reluctance on the part of the people of Riga (likely to be the most pro-euro part of the contry) to join a problematic currency union. Never mind, says the article.

Still, the elections, held to select members of 119 municipal councils across Latvia—including the 60 members of Riga's city council—aren't expected to derail Latvia's planned adoption of the euro in January. The European Commission is expected this week to green light the small Baltic nation's entry into the euro zone.

Quite so. Why should votes and elections matter?