Monday, December 31, 2007

Are you local?

Since our beloved Prime Minister chose to avoid going to the country in Autumn 2007, it does not seem hugely likely that he would call a general election in 2008. So, it seems likely that 2008 in British politics will be more interested in local elections than anything else. We have the interesting challenge of the London mayoral elections. This may yet prove to be a more open and interesting contest than it appears.

To be honest, the Conservatives, by choosing Boris Johnson, have essentially admitted that the game is up. Although the gaffe-prone and disorganised Henley MP- we are told- is also possessed of finely tuned media antennae, the same could be said of Charlie Caroli. In fact, as at the Ealing Southall by election, it is the weak judgement of David Cameron that fixed on Boris as pretty much the only figure prepared to take on Ken Livingstone. Boris Johnson can not win the London election.

Ken Livingstone, however, is increasingly embroiled in his own problems. The disgraceful "friendship" he struck up with the odious Hugo Chavez - the authoritarian ruler of benighted Venezuela- has asked questions about Mr. Livingstone's judgement, and quite frankly his probity. It is by no means certain that Mr. Livingstone, despite being able to shake off other recent criticism, has clear answers to what, prima facie, looks like foreign funding of his office, through the "Venezuela Information Office", funded by Chavez. If Mayor Ken proves unable to provide satisfactory explanations for the various movements of money, then he will face unrelenting pressure. Being a political "cheeky chappie" does not give license for corruption.

So, the media, this time, will certainly give more notice to the Lib Dem candidate, former police Chief, Brian Paddick. I have only met Mr.Paddick once, but was exceptionally impressed. He is not a politician, but he has presence and ideas. Doubtless the hostile press will emphasise what they see as his negatives: "gay cop" or "soft on drugs", but most people in London accept that the current drugs policies have not worked well, and that new and practical ideas are needed. As far as sexuality is concerned, in one of the most tolerant cities in the world, it is probably a plus. Brian Paddick is an informed and interesting candidate. In the face of the comedy act between Boris and Ken, I think Brian Paddick will do extremely well- London could certainly do with more of his can-do spirit.

As far as the broader local elections are concerned, the outlook is by no means clear. The Conservatives will be looking to make further gains, but they have gained so much in the last decade, that it may prove difficult to maintain forward momentum, which would prove pretty inconvenient from the point of view of the national electoral cycle. It may be hard to feel that the party is poised to take power were they to make minimal progress in real elections (whatever happens in the opinion polls). Of course the same applies to the Lib Dems, but in this case expectations are fairly low, so in the battle of exceeded expectations, there could be a slight advantage for them.

The Prime Minister argues that 2008 will be the key year for British politics. he may be right, but he may not even have that much time. If the perceptions on the locals are bad, the sense of inevitable doom may gather around his administration. yet if labour did unexpectedly well, the pressure could return to the Conservatives. The race remains tight. The Liberal democrats will then come under very strong scrutiny: in a hung Parliament, what would Nick Clegg do?

He had better have a very clear answer. For the Liberal Democrats, a hung parliament is as much a challenge is it is an opportunity. The political weather that decides the Lib Dem strategy is being formed now and over the next six months: the 2008 locals will be hugely important.

Friday, December 28, 2007

Doom and other financial hiccups

I notice that, as Sterling hits a new low against the Euro, that Ambrose Evans Pritchard is now predicting 1929 is the benchmark to measure the likely fallout of the credit crunch.

Now, I am starting to think that Ambrose is beginning to sound like the boy who cried wolf a bit. I do not underestimate the scale of the emerging problems- as I have said before, the scale is truly enormous. However Evans Pritchard continues to add in his view that the Euro will collapse and much of the European Union with it. In fact, I think that the fall of the British Pound is a good thing- it helps make British products more competitive in selling into the European market. As for the US- the fall in the Dollar is already helping to correct the dramatic financial imbalances that have emerged over the past decade. This does not mean that either the US or the UK will escape recession, but neither does it mean that the problems are of the same order of the Japanese deflation of the past decade and a half (and even if they did, the Japanese are not exactly starving on the streets).

Yet again it is the mono-mania of the anti-Europeans that is removing all sense of perspective. There are problems, but these are not black and white issues- and the shades of grey can still leave plenty of room for very positive outcomes too.

Many will greet 2008 with pessimism, I do not- I am realistic about the positives and the negatives. I am not blind to the faults of the Eurozone, but neither do I ignore the advantages. As the Euro continues to climb against Sterling, we are hearing precisely the same predictions of doom as we heard when it was falling- and the ups and downs of currency markets are very poor indicators of fundamental prosperity.

Thursday, December 27, 2007

Bubbling Under...

I am not quite sure what I have done to deserve such support from Iain Dale, but yet again I seem to have come surprisingly high in one of his blog lists. Admittedly it is like being nominated for one of the lesser species of Oscar- best sound mixing, for example- when a Conservative blogger nominates a blog from a different party.

The only thing is that this time it was a rather broader selection of his readers- apparently over 2,300 made the choices in a very large number of categories. So, in the circumstances to get 6% of the vote and sixth position as Liberal Democrat blogger of the year is faintly remarkable, especially since the actual winner of the Liberal Democrat blogger of the Year- awarded at the conference in Brighton- James Graham, only comes out one position ahead. All it really shows, I suppose, is the names of the blogs that the largely Conservative readership of Iain's blog actually recognise- in other words the blogs that he mentions or links to.

In any event, I might suggest that Iain is a lot more successful in bringing people into his blogging big tent that Mr. Brown has been with his increasingly faded aspirations for his Cabinet.

The Weakness of Giants

2008 is the year of the Beijing Olympics, so it seems quite likely that there will be much discussion of China over the coming year.

Doubtless, there will be much portentous commentary, especially from US commentators, who have always had a fascination with the only country likely to challenge American hegemony at least in the short run. In the end, I think a new sense of balance will emerge.

The supposed threats or challenges of China to the West are also matched by some dramatic weakness. Although the country has become the workshop of the world, the financial system remains astonishingly primitive, and most of all the country's political system dramatically limits its ability to innovate. small and corrupt elites around the intellectually bankrupt Communist party continue to stifle much progress. Increasingly the quality and the cost of Chinese goods are less attractive in the world market. Indeed the United States, after falling back, could be poised to rediscover its own competitive advantage as the devaluation of the US Dollar boosts American exports substantially.

Meanwhile another concern for the West, Russia, also appears to be riding high, as it enters the New Year. Buoyed by high commodity prices, the country has created thousands of millionaires and even billionaires. Increasingly assertive on the world stage, Russia has become an object of great concern as it seems ready to renew the challenge of the first cold war. However, the veneer of wealth masks a much grimmer story. Although Vladimir Putin appears to want to stay in power, by putting his own man- Dimitri Medvedev- into the Presidency, while he himself returns to the Prime Minister's post, in fact a power struggle laps around the Kremlin. More to the point Putin is set to swap another job with Mr. Medvedev- Chairman of Gazprom, and this may be of greater economic significance.

No matter what he does, Putin faces challenges. The fact that a reputed personal fortune of $ 40 billion has been publicised reflects a growing impatience in certain quarters with the division of the cake amongst the siloviki- Putin's own circle of secret policemen. If commodity prices now fall, the economy is dangerously exposed, since the high rouble has crippled the country's ability to compete in manufactured goods. 2008 could be a turbulent time for Russia.

The challenge for the West, as it deals with its own problems in a dramatically less liquid credit market, will be not so much how to handle an assertive Russia or China, but possibly more difficult, how to handle two countries facing significant economic problems and quite likely, political instability.

Friday, December 21, 2007

Strange lookalike

An intensely driven, rather solitary and gloomy man from a strictly religious background achieves the heights of politics. This comes after a long struggle against more popular figures in his own party at a point when many have previously written off his chances completely.
The Leader continues to prosecute an Asian war inherited from his predecessor, though ultimately the leader hopes to withdraw his forces. Intensely driven, the leader feels a sense of inferiority towards the more socially polished figures around him and resentful of their thinly disguised patronising of his education and background. There are rumours of questionable practices amidst a self selected elite close to the leader.
His intensity repels as much as it compels.
A firm believer in big government solutions to people's problems, nevertheless the leader does not enjoy the full ideological support of his party, where he is often considered as betraying its fundamental principles in an attempt to appeal to the other side.
Jowly and stubbly, the leader finds it difficult to smile.

James Gordon Brown or Richard Milhous Nixon ?

Thursday, December 20, 2007

One for Private Eye

This story of a failed burgler certainly brightened my day.

I think it is the last lines that make the story:

"As prosecutor Peter Bardsley outlined the case, one probation officer had to leave the courtroom because she was laughing so much.
Defending, John Lee said: "This has all been the cause of great embarrassment for him. He is remorseful, ashamed and has moderated his drinking.

"He does not want to end up as the Grim Reaper again."

Wednesday, December 19, 2007

The Curse of Cicero...

An absolute joy to see the vile Tommy Sheridan being charged with perjury. I commented at the time on what- even then- seemed his dubious acquittal, that we had not heard the last of the case. I for one look forward to justice being done to one of the most negative influences on Scottish politics in recent years.

Then again, only a few days after commenting that the role of the First Minister in the Balmedie Golf fiasco seemed pretty questionable, it seems that indeed Wee Eck now has to face questions over precisely what and when he did things.

I certainly hope that the Curse of Cicero will fall on their heads and on that of Mr. Livingstone, who has also been a little closer to certain allegations than we might have expected.

Protocols of the Elders of Brussels

Amidst the various comments on concerning the election of Nick Clegg as leader, there came this rather priceless contribution:

"Clegg is a fully-paid up member of the new European elite who want to replace democratic government by a kind of bureaucratic authoritarianism, in which all important decisions will be taken by unelected committees of technocrats.

This will of course be disguised by window dressing such as the fatuous ‘Town Hall Meetings’ you describe, as well as ‘regional assemblies’ and other such nonsense.
It’s surprising he made his position so obvious though - a serious gaffe.

Runnymede December 19th, 2007 at 1:08 pm"

As I commented later in the thread, this is why it is really hard to take the Conservatives seriously on the subject of Europe. It is this kind of dribbling, barking-mad Europhobia is like dealing with “Mother” out of Psycho- always this twitchy, defensive weirdness keeps coming out.

As Churchill once said, “A fanatic is one who can’t change his mind and won’t change the subject”.

There is a lot wrong with the way the EU works, but attacking those who support the basic idea of a pan-European organisation in these almost demented terms is just not going to do anything but make you look strange.

What bothers me even more is that Gordon Brown, through his rather pathetic antics to avoid being seen together with the other signatories of the reform treaty, even gives their barking-mad ramblings some peculiar resonance.

Brown and Out

Nick Clegg takes his place as leader of the Liberal Democrats facing the usual chorus of contempt from his political enemies. It is not a question of making the best of any honeymoon, because there is not going to be one. He will be hectored, booed and ambushed at every turn. His first PMQs on January 9th will be a baptism of fire- with Conservatives especially keen to show him in a weak or ineffectual light. The usual script against the Liberal Democrats is to try to paint them as "pointless" or "irrelevant", since research proves again and again that the biggest problem the party has is establishing its credibility- this is why so much effort in Lib Dem's campaigning: bar charts, "winning here" and the rest of it, is to simply persuade the electorate to take the prospect of a Lib Dem victory seriously.

All of this is just part of the knock about fun that is British political debate.

The reality- as the intelligent strategists of our political opponents know all too well- is that when credibility is a given for the Liberal Democrats, when they win in a constituency for example, then they become very formidable opponents indeed, and devilishly difficult to shift. When credibility is established, then the electorate takes the party seriously. This is why both Conservatives and Labour try to mock the Liberal Democrats and rubbish their credibility as often as they do.

However, the Brown funk that caused Labour to abandon their plans for an election in the Autumn of 2007 now opens up some interesting and potentially exciting times for Liberalism in the United Kingdom. The Blair-Brown government, authoritarian but afraid, is looking increasingly shop-soiled. Carelessness is leading to allegations of sleaze and- far more damaging- the impression of incompetence. Although Labour may yet turn it around, the brooding and vengeful personality of the new Prime Minister is not one that inspires the benefit of the doubt.

The Conservatives are meanwhile cautiously rediscovering their appetite for power. Slowly, despite continuing problems of cohesion, based on the lack of trust that a significant minority amongst the Conservatives still feel about the Cameroons, the party is establishing a brittle kind of credibility. Interestingly, David Cameron has taken up some long-standing Liberal themes: breaking the centralisation of decision making and reestablishing a more local state. Of course David Cameron is no Liberal, simply because he cherry picks a few Liberal Democrat ideas, but it is a backhanded compliment to Liberalism nonetheless. However, without a real commitment to the core change- to the voting system for Westminster- it is pretty much impossible for Liberal Democrats to take the Cameroons offer of a "progressive alliance" against Labour too seriously.

The challenge for Nick Clegg will be initially simply to survive the firestorm that will be launched against him over his first two or three months. He will need iron focus, considerable discipline but, above all- as Vince Cable has shown- a quickfire sense of humour in order to avoid the fierce criticism that he will undoubtedly get from both our formal opponents in other parties and our more dangerous opponents in the media.

However Clegg also has an opportunity. The front bench that he inherits is arguably the most talented in the House of Commons. He can rely on a flow of distinctive and well thought out policy ideas. In particular he is facing a government that is being increasingly challenged by events and by its own limitations of personnel and ideology. The balance of the 2005 election brought many Labour seats within range, in Newcastle and Liverpool, for example, where despite controlling the City councils, the Lib Dems have yet to break through at Parliamentary level.

Yet there is a potential trap: the party must not seek to appeal to ex-Labour voters at the expense of its' commitments to the Liberal ideas of individual freedom. This is where the new leader will need to be exceptionally thoughtful about presenting Liberal ideas in a way that can appeal, rather than by being driven by a PR agenda which ultimately blunts the ideology of the party- why, for example I have often been quite sharp in my responses to the Conservative poster "Lepidus". After all this time, I for one am not prepared to reduce my commitment to Liberalism- even were that to be seen as more appealing in the short term.

Labour may be becoming demoralised, but the opportunity for the Liberal Democrats is not just to be the recipient of ex-Labour votes. We should go toe-to-toe with the Cameroons and demonstrate why our commitment to Liberalism is deeper and better than the skin-deep "Liberal-Conservatism" of David Cameron's party. That will be what makes us a party that is genuinely national, genuinely radical and able to appeal to the whole of the United Kingdom.

Tuesday, December 18, 2007

Clegg as leader

Well- Congratulations to Nick Clegg. As regular readers know, I voted for Huhne, but am happy to accept the skills claimed for Clegg as a solid and charismatic leader.

In some senses I think the closeness of the result reflects not so much a verdict on Nick Clegg, but a lack of confidence in the party grandees who made him their candidate- as they did with Charles Kennedy and Ming Campbell. I think that Clegg now has a free hand to ignore the grandees, reach out to the former Huhne-ites and continue the recovery that began under Vince Cable.

Now we shall rally round and try to get better traction for our ideas.

Why David Cameron will end in failure

One of the more commonly used political quotes is from Enoch Powell:
"All political lives, unless they are cut off in midstream at a happy juncture, end in failure, because that is the nature of politics and of human affairs."

At a time when David Cameron's Conservative Party appears to have broken out above the level in the polls where the party can achieve a comfortable working majority, it may seem a little perverse to think about the failure of David Cameron. "Surely", many of my Conservative friends will say, "He is poised to lead the Conservatives to a dramatic electoral victory". Well, perhaps he may indeed cross the threshold of 10 Downing Street as a victorious party leader. However, even if he does, that is no guarantee of a successful leadership. The Greeks often said "Call no man happy until he is dead", and as with any good Greek tragedy, the makings of disaster lie in the tragic flaws of Mr. Cameron's own personality.

The Conservatives have been putting out "signals" to the Liberal Democrats- suggesting that since both parties now agree on the need to transfer power back to local communities from Whitehall, then surely this could be the makings of a "Progressive Consensus" between the two parties in order to oppose the Labour Government more strongly. Of course, there is more joy in heaven over one sinner who repents than over ninety-nine righteous persons who need no repentance. However, it is still hard to forget that it was the Conservatives, at least as much as Labour who presided over the centralising process in the first place.

David Cameron, like any politician with no experience of administration or management confuses an aspiration with an achievement. The current Labour government have this deficiency in full measure. They set targets with no idea how to achieve them. The result is that the system responds by attempting to achieve the target and nothing else. A good example is my local Doctors surgery. The target is that no patient should wait more than 48 hours for a Doctors appointment. However there is no excess capacity. What happens is that I, for example, can only book an exact time to see a specific individual doctor on a non-emergency basis, and wait up to two weeks. Otherwise I may phone early in the morning to get a doctor allocated randomly to see me at any time over the next 48 hours. Unfortunately I work very long hours and can not randomly leave the office. As a result the service I get from my NHS GP is actually much poorer than I would have got if the 48 hour target was not there.

This shows the difference between the aspiration that no-one should wait more than 48 hours to see a GP and the effective implementation of that aspiration. Another aspiration- masquerading under the name of policy- is that "Matrons" have the right to close a ward that is deemed to be inefficiently clean. However the backlog that an unscheduled ward closure creates renders it all but impossible to take that decision, there is simply not enough slack in the system, and the result is that MRSA and Clostridium difficile and other difficult to treat infections can flourish in our hospitals.

Cameron too has many aspirations. However, "fine words butter no parsnips". The PR presentation of his ideas show, all too clearly, that he does not have sufficient understanding of the administrative process nor of simple management to be able to achieve any but the most simple of his policy goals. One reason why the Liberal Democrats are often accused of being political anoraks is because much of our policy ideas understand that the aspiration hides the real difficulties of implementation- the devil is in the detail.

As Alan Clark once observed Yes Minister was as true to life as any documentary. David Cameron, like Tony Blair before him has not even been a junior minister, he has not been involved in any executive management. The fact is that his inexperience will not allow him to even understand the basic tools of administration for several years. By which time he will have already have made irreversible mistakes.

As with most politicians, David Cameron is an extrovert- perhaps not as extroverted as Lembit Opik, who really does seem to have the hide of a Rhinoceros- but there are certainly risk taking elements in his personality. He is not, I guess, too interested in the details of administration. He has, reputedly, a short temper. Already one can see the confusion and isolation that the office of Prime Minister will lay upon him. He has built his career seeming to be a cheerful Pollyanna, but confusion, frustration, and failure are likely to be his personal rewards for the achievements of high office. The limits of power can not be overcome unless one has a single overarching vision: a Churchill at war, perhaps or some aspects of Margaret Thatcher's second government in the 1980s- but they of course had a far broader experience, including long periods as senior ministers long before they assumed the top job. Neither Tony Blair, nor David Cameron ever served in cabinet before they became leaders of their respective parties, neither had either been a manager at any level in either the public or the private sector.

The fatal lack of experience, combined with the failure of understanding and a lack of introspection could lead to the same outcome for Mr. Cameron as for Mr. Blair.

For all of these reasons and many others, Liberal Democrats argue that changing the party of government will not alter things. Only a change to the system of government can do that.

That is a far bigger question than Mr. Cameron's PR driven mischief on the "progressive consensus" and it is the centre of Liberal Democrat ideology and its detailed policies.

Friday, December 14, 2007

Another day...

...Another Airport... off to Munich.

A day trip- I shudder at the carbon dioxide, but needs must.

Hopefully the crisp winter air of the Bavarian capital will provide inspiration for some Christmas shopping.

The Last Trump for Salmond

Donald Trump does not make money from Golf Courses; He makes money from buildings.

The plan for a new "World Class" Golf Resort at Balmedie, north of Aberdeen, is not about the new golf course, although in fact golf courses do have an environmental impact, it is about the fact that the new luxury hotels, house and apartments are essentially building a new small town on an extremely sensitive site.

Aberdeenshire Council Planning committee were right to consider the implications of the project very carefully. The fact is that with oil at $100/bbl, there is not a problem for jobs in the north east. The question comes down to the environment and the infrastructure: the environment is sensitive and the infrastructure is inadequate. In the event the planning committee decided that the project should not go ahead. So far, this is just another planning decision.

What happened next is disgraceful.

After meeting with representatives of "The Donald", the First Minister decided to call in the decision for review- ignoring the fact that the full council of Aberdeenshire had decided to do just that in any event. In the meantime, those local councillors who had voted against this grandiose project were attacked- physically. As usual, the SNP have ignored local authorities- they simply want a centralised- separatist- government in Edinburgh. rather than genuinely local decision making.

Mr. Salmond has been hob-nobbing with big business a lot recently- and the transformation from "Scottish Social Democrat"- or even radical Socialist- as Jim Sillars or Margot Macdonald might have termed themselves- into Tartan Tory is almost complete. Several Tories have already privately said to me that they already function in an informal alliance with the SNP.

Doubtless, Mr. Salmond's cosy little meetings with the Trump Organisation have fostered a good understanding. "The Donald's" Resort will doubtless get built- and Aberdeen will extend north as far as Newburgh bar on the Ythan estuary. The site of special scientific interest will be destroyed in the name of greed- and Alec Salmond can open the resort in the name of the pork barrel politics that his porcine features are becoming increasingly familiar with.

It is not right that the wishes of local residents can be railroaded without even a sensible debate- the resort is not an unalloyed good for the north east, neither is it free of cost, but all of that is being ignored in the name of the quick buck and the short term- and we will rue the day that this ever happened.

Thursday, December 13, 2007

Brown is Yellow

Oh Purr-lease! Gordon Brown was "too busy" to co-ordinate times with all the other 26 heads of government in the European Union, so could not sign the Reform treaty with them, but had to do it in the shed, while all the other leaders went to have a boozy lunch.

What a totally pathetic way to behave! Poor old Gordon "No Mates", has not got the balls to either so "no, I won't sign" or "Yes I will sign with everyone else... and then get pissed".

I don't know why he did not just create a "review' to decide whether he should sign or not- then he could put the decision off forever- just like he does with everything else.

Wednesday, December 12, 2007

Russia: No Comment

Today's News from Russia:

The Russian Federation has suspended its participation in the CFE treaty, thus removing it from the obligation to report significant troop movements to NATO.

The Russian Government has ordered the closure of British Council offices in the country, arguing that the cultural organisation was operating illegally.

Having hand picked Dimitri Medvedev to be his successor as President, Medvedev has indicated that he will pick Putin to be Prime Minister.

An influential Finnish foreign affairs council has suggested that Russia would respond with active displays of military force, were Finland to join NATO, as the majority of the Finnish population appear to want.

Russia confirms that it will veto any United Nations attempt to recognise a declaration of independence of Kosovo.

Andrei Lugovoi, wanted for the murder of Aleksander Litvinenko in the United Kingdom makes quips about his status as an indicted suspect, given the immunity his election to the Russian Duma confers within Russia.

Another Judge has been murdered in the North Caucasus.

Meanwhile a detailed analysis of the results suggests that the results of the elections to the State Duma, apart from being rigged, were actually quite poor for the Putin clique: with more than seven million people who voted for Putin last time not doing so this time.

Meanwhile, Freedom House in their report on the elections points out that, far from the affirmation of stability that Putin would wish, in fact the ballot rigging is a serious threat to the long-term stability of the country.

Just another day in the World's most powerful rogue state.

Monday, December 10, 2007

The triumph of expedience over hope

As the great get together of European and African leaders gradually winds down in Lisbon, it is hard not to be cynical. The presence of such figures as Robert Mugabe President of the country that used to be Zimbabwe and is now a collection of ruins or Omar Hassan al-Bashir of the benighted tyranny of Sudan makes it hard not to emit a hollow laugh as certain European leaders make protests of brotherhood and equality.

Europe has much to do when it engages in Africa: opening up its market for African goods would do far more to alleviate African poverty than all of the assistance programmes of all the European States combined. However the EU remains in thrall to powerful interest groups and no such change seems to be in prospect. European consumers pay for expensive food while those who could supply it cheaper are unable to trade and often left to starve.

Meanwhile by inviting the murderous tyrants amongst the African leaders it shows the hand of friendship to those who should in fact be shunned utterly.

If that is the European leaders idea of "brotherhood", it is fairly contemptible.

Tuesday, December 04, 2007

American Tragedy

So George W. Bush has not had his opinion changed by his own intelligence reports?

So those reports indicate that Iran does not have nuclear weapons, and indeed has dramatically slowed such programmes that might lead to the development of such weapons.

Now, I am all in favour of being a little cautious, given the implications that would arise were Iran indeed to gain a nuclear capability.

Unfortunately the United States is saddled with a President who can not admit even a scintilla of doubt- no matter what. Having isolated his country and presided over a catastrophic economic weakening, the worst President in American history seems to have forgotten nothing and learned nothing.

I can't decide whether his arrogance is rooted in malignity or stupidity, but he has no political capital left. The tragedy is that we still have to wait for just over one more year for this catastrophically limited man to leave office.

It may yet be that still further disasters lurk for this man so that he can leave a truly uniquely disastrous legacy. However, unfortunately for Mr. Bush, politics is not like a game of Hearts- you can not still win if you "shoot for the moon"- all you leave are even bigger screw ups.

Monday, December 03, 2007

Putin makes his move

I still expect Vladimir Putin's exit to be vertical and not horizontal.

The election has been stolen, as expected, but the battle lines amongst the Siloviki are already being drawn up, and even if he *is* able to transfer some powers and then become PM, it is inevitable that his position will be lessened. The strains within the regime will become more obvious, so I suspect today will be seen as something of a high water mark for Putinism. Sooner or later a law based system needs to emerge, and with oil down $10 this week, it may not even be too long before Russian inefficiency and the cupidity of the Russian State begin to show up in further weakness, rather than the boom/strength that most are forecasting on the basis of the oil wealth transfer.

In short, Although the timing is highly problematic, I think that there are political threats that will add to the demographic crisis to undermine progress, even while in the short term those who think that Putin represents stability and that the commodity/oil money will not slacken off soon (Russia bulls) will clearly be in the driving seat as far as sentiment is concerned.

Some may say that the "result" of the poll creates greater stability- in my view it weakens the long term security of the political system. Ultimately the drive for stability will end up undermining it.

Thursday, November 29, 2007

Barbaric Sudan

For those who might be interested, the address of the Embassy of Sudan in London is:

Embassy of the Republic of the Sudan
3 Cleveland Row
St. James’s

Should you feel that the violent and unpleasant regime might need reminding that civilised states do not jail teachers on trumped up charges under a kangeroo court for allowing their class to name a teddy bear, my suggestion is that you let them know that the people of the United Kingdom hold them in the most abject contempt.

After all it is merely the latest crime from a regime that is racist, fanatical, despotic and evil.

I think that the man who represents this disgusting regime in London, Omer Siddig, can leave as soon as he likes, and I do not think that our woman in Khartoum, Dr Rosalind Marsden, need detain herself further in attendance to these vermin.

The Liberal Democrat Leader

The role of the Leader of the Liberal Democrats is one of the most difficult in British politics.

Unlike the Leader of HM Opposition, there is no specific financial support for the leader of the party, neither, except at election time, does the Liberal Democrat Leader have Police security protection.

Yet despite the reduced official support, the role of the leader is, if anything, even more difficult than that of the Leader of the official Opposition. In a system explicitly designed to divide only two ways, the Leader of the party must overcome the structure of the constitution as well as the efforts of the other parties. Defining the position of the party in the face of the indifference or hostility of most of the media is equally difficult. The position of most journalists is that whatever the Liberal Democrats say or do, they are irrelevant: and as a result the party rarely receives the coverage that its ideas and support deserve. Although gaining the support of around one in five voters, the party gains less than one in ten of the seats in the House of Commons.

Truly the job is difficult and dispiriting.

Yet the reason why Liberal Democrats continue to put so much effort into politics is because we believe that Liberal ideas are vital to preserve our freedoms and to enhance the way of life of our country in the future. Liberalism is a disciplined and coherent ideology based on maximising the freedom of the individual. We are economically Liberal because that is the best way to generate prosperity, we are socially Liberal because the role of the state should not define how individuals should live their lives.

The two candidates for the Leadership of the Party have both put Liberal visions. We are therefore told by commentators that the differences are more of emphasis and presentation. Certainly Nick Clegg, one-on-one is attractive and charismatic. He has certainly put forward intelligent and interesting ideas during his tenure as Liberal Democrat Shadow Home Secretary.
His weakness has been to lack crispness in dealing with unexpected situations- and on one or two occasions he has clearly been thrown by questions.

Chris Huhne, by contrast, has not been considered to have presented his more challenging environmental agenda so well. However, throughout this election I have been struck by the way that he has consistently been able to refer to key liberal principles when he has been asked questions. He has a deep understanding of the way that Liberal ideology knits together.

One other point has been made about this election: that impressive as Nick Clegg is, he is not the finished article, whereas Chris Huhne has less room for growth. Personally I find this a slightly strange idea: we are looking for a leader now. I can only judge the contest on what is being offered today. Indeed Chris Huhne does have more life experience; he has been a highly successful journalist and made a great deal of money when he set up what became the Fitch IBCA rating agency. His business and entrepreneurial experience is impressive. I have also no doubt that success did not make him universally popular. Several people have said to me that "of course Chris can be a bit of a bast*rd sometimes". This is not, however a popularity contest, it is a test of leadership, and an element of ruthlessness is clearly part of the job description.

Finally, I think that many people- both inside and outside the Liberal Democrats- have been impressed by the way that Vince Cable has performed as leader. For me it has been a tonic to see his disciplined and consistent approach, based on considerable knowledge and experience outside of politics.

This has been a difficult decision. I think both could do the job exceptionally well. I have been impressed by the way that the party has responded to both candidates. Certainly I did not expect to be hesitating this late in the contest. I was leaning strongly to Nick Clegg at the start.

Nevertheless, for his experience, his principles and his disciplined focus:

I will be voting Chris Huhne.

Cultural Relativism

I know that in today's world we can not generally sit in judgement over the matter of cultural differences. However there is currently a very clear example of where we are entitled to make a comment. The arrest of a British school teacher who allowed her class to name a teddy bear after the name of one of the kids in her class- Mohammad- is extremely simple.

Those who accuse her of a crime are evil.

Were they to succeed in inflicting punishment upon her, particularly the whipping that is suggested, then they would be barbarians.

I see that the Sudanese Ambassador has been summoned for the dubious pleasure of a dressing down by our boyish Foreign Secretary. I sincerely hope that this wrist slapping is backed up with a concrete message: No free citizen should endure arrest and charges for such an absurd offence, and that if the Government of Sudan proceeds with this case it will be labeled "evil" "barbaric" and will be severely punished.

Wednesday, November 28, 2007

Browning on Brown

One task more declined, one more foot-path untrod,
One more devils'-triumph and sorrow for angels,
One wrong more to man, one more insult to God!
Life's night begins: let him never come back to us!
There would be doubt, hesitation and pain,
Forced praise on our part--the glimmer of twilight,
Never glad confident morning again!

The last lines of Robert Browning's poem, The Lost Leader have been widely quoted against politicians, especially since they were used so effectively against the declining Harold Macmillan during the Profumo scandal.

It does not look good- the government seems accident prone and whereas Tony Blair was a lucky leader, Brown, with his volcanic intensity seems too brooding and driven to be likable. He clearly is a bright and thoughtful man, but his angry motivation is alienating and difficult. His secretive and mistrustful nature has isolated him in his party and in Parliament; and all of this has become apparent in only six weeks.

In hindsight, the decision to delay the general election seems likely to lead to a completely different political environment over the course of the next two years. Instead of moving forward, the government has made a series of catastrophic decisions: the abolition of taper relief on capital gains tax will cause significant problems in the private equity business, while the changing of the 90 day a year non-dom rule to include the days travelling will cause a significant number of hedge funds to leave London. The run on Northern Rock has left tax payers with an open ended commitment of billions of Pounds and brutally exposed the weaknesses in the British regime of financial regulation. The fiasco of the missing data discs simply shows up the fatal flaws in a flagship policy of the Labour government: the multi billion Pound ID cards project.

The global economic background grows bleak indeed- the political environment for Labour grows colder. So cold that the dreaded word "sleaze" has returned to haunt a sitting government. Sleaze is usually a symptom of a failure, rather than its ultimate cause. The question now is can Labour recover?

In my view the answer is: No.

The next question is altogether more complicated: so, what next?

In my view, this could be a dramatic opportunity for the Liberal Democrats- thus the choice of new leader will be a significant factor in how the party takes advantage of this opportunity.

I will address that issue tomorrow.

Checking In (again)

Just back from a couple of days in rather foggy Ljubljana.

The car crash of the Brown government seems now to be spininng down the cliff with the flames about to burst from the petrol tank... what fun!

Thursday, November 22, 2007

The challenges that the next Liberal Democrat leader must address

I believe that there are several key challenges that Britain now faces and which the Liberal Democrats must address.

The role and power of the State has grown substantially over the course of the past two decades at a time when those who control the state apparatus are coming from an ever smaller pool of career politicians who lack the management skills required to administer the increasingly complex mechanisms that are supposed to deliver the promises that they make.

The result has been increasing disillusionment from an electorate that has learned that politicians can not deliver what they say. Furthermore, despite their manifest failures, the political class has largely escaped from personal responsibility for the mistakes that they make. A cosy consensus between the civil servants and successive governments has created a powerful, secretive and unaccountable State. Local government, dependent on Whitehall for its finances, has been eviscerated, and yet the legal responsibilities of Councillors are so arduous that ever fewer are prepared to take on the role except on a professional basis. Forty years ago we had MPS who were quite badly paid, since most had outside interests, and unpaid Lords and Councillors. Now the costs of our democracy have increased almost exponentially.

The scale of government has grown to a level that is beyond the capacity of the archaic systems of our constitution, and quite probably beyond the capacities of any constitution to control.

Britain faces a constitutional crisis.

In the wider world, the mismanagement of the Bush administration has created two challenges. The first is the result of the failure of the United States to deal with its lax credit market until it was too late. Essentially the United States has created an approximately $47 trillion debt that it can not repay. In effect, the fall of the Dollar is leading to a gigantic default on this debt. The overall result is that the economic role and prestige of the US- hitherto our closest ally- is being weakened at a time when it faces the new challenge of a resurgent China. Far from being a hyper-power the United States is becoming merely a first amongst several powers of roughly equal weight. Associated with this economic decline is the spectacular failure to meet the challenge of Islamic terror. The costs of the wars in Iraq and Afghanistan are beyond what the US can realistically sustain. In short, the US, leader of NATO, and of the democratic world has reached the position that Paul Kennedy warned of in the Rise and Fall of the Great Powers: Imperial Overstretch.

The challenge for Britain in the face of the decline of our leading ally is to define a new set of relationships that can maintain British security and influence. Furthermore, this must perforce be done in a manner that maintains liberal freedom. The challenge of the rise of the so-called BRIC powers- Brazil, Russia, India and China- is that neither Russia nor China are democratic and that Brazil and India have relatively unfree economies. The new economic and political world is both more politically unstable, but also more economically unstable. At some point, we may see the return of production from China to the United States as the costs of business tend to equalise. The risk is that China might become protectionist in order to weaken this process.

The consensus amongst the other European powers to meet this challenge has been to pool a degree of sovereignty and to forge closer political co-operation. However the process of reform in the European Union has been very slow and very piecemeal. There is a significant group that argue that the costs- economic and political and well as financial- of the EU, outweigh its benefits. However, in the face of the dramatic challenges emerging globally, it seems clear that a considerable effort must be made to ensure that the liberal, open economies of Europe continue to work together and to provide an example and a force that can promote liberal economics and liberal democratic values. Leaving the European Union is not an option: we must engage and make it work.

Britain faces serious political and economic challenges in this new world system.

Part of the challenge that the decline of the US Dollar and the growth of economic power in the BRIC powers is that there is a squeeze on global resources. In addition, the relatively energy inefficient Chinese economy is adding to global Carbon Dioxide emissions. As the planet faces the costs of the human population growth over the course of the next decades- leveling off at around 10 billion- combined with the forecast oil production peak, it is clear that our planet faces a serious problem of sustainability.

Britain faces serious challenges of sustainable growth and energy security.

In the past few years, the United Kingdom has been successful in attracting high quality individuals to work in our economy. The influx of several hundred thousand people, both from inside the European Union, and to a lesser degree from outside it, has been a major factor in the success of the British economy over the past decade. It is changed our country, but by and large these changes have been welcomed. However, that there is a cost to these social changes is undeniable. Furthermore, it underlines the weakness in several key areas of British infrastructure, including especially education. While the general quality of higher education is globally competitive, the quality of British schools has not kept pace. Too many pupils leave school lacking basic skills, such as literacy and numeracy. Furthermore, the average quality of British state education, despite the soaring grade inflation showing in examination results, appears to be declining. The lack of language skills in British pupils is particularly striking. Although the UK has benefited from the influx of hard working and well educated foreigners, our domestic education levels should cause us concern.

Britain faces serious problems across its whole infrastructure- and the failure to provide timely investment is undermining our competitiveness. Although we can plug the gaps in our human capital through immigration, the weakness across our physical capital will take decades to fix- even if a sustained programme of renewal was started now, which it has not been.

In my opinion the Liberal Democrats are the British political party that most recognises the challenges that we face and has developed coherent ideas to tackle them. In particular, the ideas of accountability and political reform that the party espouses makes it more likely that the challenges that we face can be dealt with in an intellectually coherent way.

I have listened to both Nick Clegg and Chris Huhne. Both have put forward ideas that are credibly Liberal. I have not had complete answers to the questions that this big picture survey raises, but I am satisfied that both would be credible and attractive leaders. I believe that either could take advantage of what I believe could become the best opportunity to achieve the reforms we believe are required to our country and to create a more open, fairer system of government and perhaps a fairer and more tolerant society. Although as regular readers of this blog will know, I am sceptical about the value of detailed policy promises, I believe that both have the right instincts. I will be happy with either as leader.

I am close to making my decision. I will make public that decision when I have made it.

Wednesday, November 21, 2007

The Lesson of HMRC and UK Treasury incompetence

This is the central problem of modern British politics: too many kid politicians who have never had any experience outside of politics. Both Brown and Cameron and most of their respective front benches are people who have no understanding of even the first principles of management. They literally know nothing about it. The professionalisation of politics has created machine pols with limited life experience and poor administration skills.

Meanwhile the machinery of government is being required to do more and more difficult and complex things. The result is a recipe for disaster. Without major simplification of administration and the constitution it is hard to avoid the idea that government will grow more alienated from the people it purports to represent and that administration will deliver more and more foul ups on this scale.

This is a disaster for Labour, but the implications are as much constitutional as they are party political, in my view. The fact is that a Minister, from whatever party, has generally only a limited idea of the workings of their department, and serving maybe 20-30 months on average, they do not get the chance to find out much more. Without any managerial skills, they are doomed to be ineffectual figureheads.

The Liberal Democrat case for constitutional reform rests on two key ideas: the principled case based upon the Philosophy of openness and accountability embedded in Liberalism. The second is the pragmatic case based upon the fact that the State apparatus can not deliver anything like the results that are expected.

After the past few days, I have seen Vince Cable rip the government to bits. I believe that, despite the fact that the Lib Dems have been derided and dismissed, the time for our ideas has come.

The Conservative party is also led by yet another machine politician and the backlash against the idea that politics is a career and not a vocation is going to grow ever stronger as it becomes apparent that professional politicians are incompetent at everything... except politics.

Tuesday, November 20, 2007

Continuing qualms about Clegg

I don't have much to say about the Politics Show battle, but the "outrage" amongst the Lib Dem bloggers for Clegg feels a bit manufactured to me, and I am not sure that Nick was well advised to formally complain.

I did think that Huhne coped well with the obvious ambush though.

I have still not decided on this one, but I do not see that Nick Clegg is the great communicator that is backers have suggested. I do see that Chris Huhne has put forward some interesting and challenging ideas.

I like the idea of a leader with real life experience, (unlike Cameron or Brown), but also see that Nick Clegg does have considerable talent.

Mind you, I think one man who has come out from all of this looking like a complete star is Vince Cable- I am tempted to start a write in campaign to get him to stay on as leader!

UK Media now a provincial backwater

I have been wondering about the British media recently.

The constant coverage of "Slebs" and "infotainment" has got to have a price.

I finally see that it it does.

Did you know that a large demonstration took place yesterday in Brussels protesting the delay in forming a government and supporting Belgian unity?

One might have thought that such a significant event might warrant a story on the BBC. In fact I got the story from Al Jazeera. On the British media, neither press nor the BBC seems to have reported this at all- not even as a five line story.

Now some will find the very idea of Belgium faintly comical. The Economist has recently called for the country to be dissolved. However the fact that the majority of Belgians still rather like their country and thousands are prepared to demonstrate this support will presumably come as a surprise to British commentators.

If we are so ignorant of the affairs of a country which is practically our closest neighbour, it can hardly be a surprise when our country makes misjudgements in countries much further away, like- to pick two examples at random- Iraq and Afghanistan.

Dumbing down is quite literally making our country stupid.

On the London paper last week, there was even- and I am not making this up- a headline on the front page: "Amy Winehouse goes to the shops".

Galina Starovoitova RIP

It is now nine years to the day since Galina Starovoitova was shot dead in cold blood.

Hers was just one of the more brutal murders of political figures in Russia over the past few years. Before her death she established a prize for the promotion of Human Rights in Russia. One of the recipients was Antoly Sobczak, the former mayor of St. Petersburg.

He too died in suspicious circumstances- of a heart attack.

Why suspicious? Because two other people in the room also had heart attacks at the same time.

Friday, November 16, 2007

Is this the shape of the Universe?

This is the E8 pattern, the most intricate shape known to mathematics. It is an eight-dimensional mathematical pattern with 248 points first found in 1887, but only fully understood by mathematicians this year after workings, that, if written out in small print, would cover an area "the size of Manhattan".

E8 encapsulates the symmetries of a geometric object that is 57-dimensional and is itself is 248-dimensional.
Garrett Lisi, a scientist who rather splendidly seems to spend most of his time surfing or snowboarding, reckons that the mathematics of particle physics conforms to the same pattern, and he predicts that a further twenty particles will be discovered when the Large Hadron Collider comes online next year.
Exciting times to be a physicist!

Wednesday, November 14, 2007

Happy Birthday PJ!

Today is the sixtieth birthday of the great American satirist and Libertarian, PJ O'Rourke.

One could hardly let the day go by without quoting my current top ten all time great PJ quotes:

10. I'm a registered Republican and consider socialism a violation of the American principle that you shouldn't stick your nose in other people's business except to make a buck.

9. The larger the German body, the smaller the German bathing suit and the louder the German voice issuing German demands and German orders to everybody who doesn't speak German. For this, and several other reasons, Germany is known as 'the land where Israelis learned their manners'.

8. The Democrats are the party that says government will make you smarter, taller, richer, and remove the crabgrass on your lawn. The Republicans are the party that says government doesn't work and then get elected and prove it.

7. Giving money and power to government is like giving whiskey and car keys to teenage boys.

6. In fact, safety has no place anywhere. Everything that's fun in life is dangerous. Horse races, for instance, are very dangerous. But attempt to design a safe horse and the result is a cow (an appalling animal to watch at the trotters.) And everything that isn't fun is dangerous too. It is impossible to be alive and safe.

5. Cockfighting has always been my idea of a great sport— two armed entrĂ©es battling to see who'll be dinner.

4. The interesting thing about staring down a gun barrel is how small the hole is where the bullet comes out, yet what a big difference it would make in your social schedule.

3. Politics is the business of getting power and privilege without possessing merit. A politician is anyone who asks individuals to surrender part of their liberty— their power and privilege— to State, Masses, Mankind, Planet Earth, or whatever. This state, those masses, that mankind, and the planet will then be run by ... politicians.

2. You can't shame or humiliate modern celebrities. What used to be called shame and humiliation is now called publicity. And forget traditional character assassination; if you say a modern celebrity is an adulterer, a pervert and a drug addict, all it means is that you've read his autobiography.

1. I have often been called a Nazi, and, although it is unfair, I don't let it bother me. I don't let it bother me for one simple reason. No one has ever had a fantasy about being tied to a bed an sexually ravished by someone dressed as a liberal.

As always- a Genius: Have a happy day, PJ !

The Tories are the Enemy of the UK

I see the corpulent Simon Heffer has outdone himself in ranting this morning.

He essentially demands that the Union that links England and Scotland should be dissolved because England and Scotland are different nations and that the Scots have too much power over England even though the whinging Jocks are just a bunch of subsidy junkies (I paraphrase lightly).

I have warned about the Conservatives' attitude to the Union in the past, and it is now quite clear what the agenda of much of the right wing press has become: to "big up" Alex Salmond and drive Scotland out of the United Kingdom.

I think that it will fail.

I think those who play fast and loose with the Union should be treated with utter contempt.

(and incidentally at $100 bbl oil prices, the idea that Scotland is dependent on the Union is simply barking)

Monday, November 12, 2007

"Archer, Aitken, Ashcroft..."

It was a real blast from the past this morning, hearing Jonathan Aitken, the ex-con Conservative, who is apparently being considered as an advisor on prisoner conditions. I know we are supposed to be a bit forgiving he has, after all, "paid his debt to society", but there was still just a whisper of the old arrogance in his interview on Radio 4. It was hard to avoid the contrast with another disgraced ex-minister John Profumo, who genuinely did serve a penance for his behaviour. Of course the political opponents of the Conservatives will make hay- it is a misjudgement by Iain Duncan Smith that only serves to remind us of the sleaze of the last Conservative administration. As Lord Ashcroft struggles to answer questions about the assurances that he is alleged to have given concerning his tax status upon being ennobled, the old taint fills the air once more.

I have three questions about the behaviour of other previous members of the cabinet.

As regular readers here will know, I have expressed astonishment and considerable concern at the fact that the Conservatives are formally allied to the Putinist "United Russia" faction in the Parliamentary Assembly of the Council of Europe. I found it inconceivable that any democratic party could be associated with United Russia, least of all in the Council of Europe, which is an organisation founded upon a commitment to Human Rights.

Perhaps the link might be more understandable when one considers that several Conservative Peers receive remuneration for their work with companies that are wholly or largely deriving their business in Russia. If you go through the register of Lords' interests, a pattern begins to emerge:

Lord Howe is the President of The Russian Enterprise Trust.

Lord Howell is a member of the advisory board of Hermitage Capital, a Russian Investment Company

Lord Hurd is a consultant to Alfa Bank,

So is Lord Powell of Bayswater, (a cross bencher, but strongly associated with the Conservatives)

Lord Lamont is a consultant to Hermitage, but also serves on the board of Rotch Property, whose sister company is Rotch Energy which appears to have acted as a front for potential Russian acquisitions in Poland.

Lord Lang is paid by Charlemagne Capital, which derives most of its income from Central Europe and Russia.

Lord Lawson is a member of Central European Trust.

Lady Neville Jones has yet to declare her interests, but she has previously had interests in firms active in Russia.

Thus several senior members of the Conservative Party are receiving substantial amounts of income from companies that have major interests in Russia.

Several others have incomes derived from companies where Russia is a significant but not dominant source of revenue.

The questions are:

Whether the views of these peers are moderated or influenced by the income that they receive.


Has any of these peers expressed an opinion on the continuing alliance in PACE with United Russia?

If so, what was it?

Friday, November 09, 2007

Nick Clegg will need to do better

I have refrained from commenting on the Lib Dem leadership election, partly because I am genuinely undecided and have been examining both candidates ideas. My initial reaction was to favour Nick Clegg. I had listened to his speech at Brighton and felt that he had put forward a genuinely modern, intellectually coherent and above all Liberal policy on Home affairs. Indeed on 18 Doughty St, I more or less said I would be supporting Nick Clegg. Nevertheless, I have also seen Chris Huhne put forward some genuinely radical policies- including taking the idea of Land tax seriously- which I think is a positive., in something of a coup for its host Mike Smithson, has had both of the contenders on to answer questions from the large number of people who comment (not to mention the even larger number of people who read the site).

To my surprise, I must admit that Chris Huhne gave more coherent and more fully thought out answers- possibly because he was invited on a weekend and also answered far more questions, but what disappointed me more about Nick Clegg was this answer to a question Mike Killingworth put forward about the placing of Liberalism on the Political Spectrum:

"I am squarely part of the radical liberal tradition of British political thought. When I was young there were only two options: you either had a social conscience but were economically illiterate and voted Labour; or you were economically literate but had a heart of stone, in which case you voted Tory. That has now all changed. Politics is more fluid and society is more diverse. Liberalism is the creed of our times."

Why Disappointed?

Because Chris put it so much better:

"Left and right are old terms in a debate that is often about liberal and illiberal, authoritarian and laissez-faire. They apply to the particular 1945-1970 period of British politics when voting was largely explained by class. Now that voting is more open, and based on ideas and attitudes, there is a role for a big liberal party in British politics. My model is the Canadian Liberal Party, able to represent the half of the electorate who think of themselves as liberal."

Many of my friends have characterised the debate between the two candidates as "Huhne who can communicate to the party, but Clegg can communicate to the country". However, I am concerned that Nick is not crisp enough in communicating to his party or his country, whereas Huhne is coming across as more intellectually coherent. Having read in detail Chris' comment about Trident, I was very surprised to find that I agreed with him. Trident is not an independent nuclear deterrent, and if we need one, we can still have one without Trident. Chris is not being a unilateralist, whatever some remarkably ill tempered comments in the Lib Dem blogosphere may say. It was dishonest of Nick's team to try to tar Chris with that particular brush.

So, to my great surprise I am still undecided, I favoured Nick Clegg at first, I now find that Chris is coming across better. I am also not persuaded by Paddy and Shirley's email in support of Nick, partly because their judgement in the matter of the leadership has not been universally strong: they supported Charles, knowing that he had issues about drink, and also Ming, when perhaps we should have thought more carefully.

So, I will listen some more, but I an surprisingly uneasy with Nick Clegg's communication so far: he needs to provide more intellectual bottom to his campaign. To be honest I would like to see his manifesto- to match Chris's in clarity.

Could it even be- highly unlikely when the campaign began- that Chris Huhne gets my vote?

We shall see.

Georgia in the Russian cross hairs

The last few days have been difficult, even in the context of the tumultuous recent history of Georgia. Riots, and government demonstrations in Tbilisi, the declaration of a state of emergency. A familiar tale of instability in the Caucasus, would be most observers diagnosis.

Except it is not.

Georgia is a country of absolutely critical geo-strategic significance. Put simply the Baku-Tbilisi corridor is the only way that oil can get to the global markets from the vast fields of Kazakhstan and the Caspian without passing through Russia.

For the West Georgia is a vital part of global energy security: for Russia Georgia poses a defiant challenge to Russian hegemony over the central Asian energy reserves.

Constantly Russia has harried and harassed the Western oriented government of Mikheil Saakashvili- it illegally expelled thousands of Georgian traders and business people in 2006- a policy condemned by Human Rights Watch . In August of this year the repeated illegal over flights of Georgia by the Russian Air force even included a missile attack.

The constant open pressure by Russia has not caused Georgia to fold, but there is also a more secretive aspect to the Russian policy. The mysterious death of the previous Prime Minister, Zurab Zhavania has been linked to the Russian secret service. Last October, Russia sealed the border after Georgia uncovered a series of Russian officials and soldiers in the country illegally with plans to either take hostage or kill several Georgian officials: the soldiers involved were handed over to the OSCE .

In the context of the constant pressure from Russia, the latest unrest in Georgia begins to assume a far more sinister shape. The extraordinary allegations made against the government by the former defence minister, Irakli Okruashvili, are so extreme that they carry eerie echos of the kind of brainwashing that former GRU agent Viktor Suvorov alleges took place under the Soviet Union.

In the face of the protests that these extraordinary allegations provoked, President Saakashvili has done the right thing: brought forward elections which he hopes will confirm that he has a mandate to continue the open market, democratic policies that have led the country into dramatic economic growth and a close relationship with the West.

It looks as though this move has defused the protests- but it has also revealed that the regime, far from being the dictatorship of Russian imagination, is firmly rooted in a democratic outlook. In fact the economy minister, Kakha Bedukidze, Is an openly avowed libertarian, who has pursued a complete transformation in the Georgian economy by massive deregulation and by a radical privatisation programme. These are not generally policies consistent with dictatorship.

The Russian propaganda machine continues to launch attacks against Georgia, while the West has been more tepid in its support for a critical ally. Georgia may be "a faraway country of which we know nothing", but as in 1938 Czechoslovakia, the fall of Georgia into the Russian sphere would dramatically weaken the strategic position of the West.

It is a game of high stakes. The Russians need to be told that their meddling must cease- now.

Wednesday, November 07, 2007

A Third Mellenium Great Depression ?

Last night I attended a seminar over dinner with a group of Traders and Hedge Fund Managers.

Over the course of the evening, various theories were discussed as to "what is happening in the global economy".

The answers put forward were complicated but more or less uniformly bleak. The overnight gyrations of the dollar and the price of oil as the result of the Chinese openly talking about "diversifying" their currency holdings seems to reinforce the sense that we are not looking a a simple turn in the cycle.

Put simply, the scale of the credit losses is now so large that the United States can not avoid a prolonged period of painful adjustment. As Hans-Redeker, currency chief at BNP Paribas, puts it "Our view is that these losses are so substantial that it puts current business models at risk."

The US is now caught is a deadly trap. The price of oil and other commodities is in Dollars, so the effect of the dramatic appreciation of the Oil price is felt directly in the US, with no mitigation from currency effects. Meanwhile, the credit meltdown is sending the economy deep into recession. The Fed keeps trying to cut rates, but each time it does so, the Dollar falls further- the oil price rises and American inflation grows. The ability of the Fed to cut rates further is extremely limited, but the necessity of doing so grows more urgent with each foreclosure. Meanwhile the forecasts now suggest that if anything, the first half of next year will be even worse as "teaser mortgages" roll over to commercial rates.

The single bright spot is that the US external imbalances are correcting more rapidly than expected- but this is a painful adjustment too- since it at least partly reflects the drastically weakening purchasing power of the US currency.

However the consensus of our discussion was sobering: the current crisis only looks like the first stage of a gigantic change that will leave few areas in the world unaffected. Despite this, the view around the table was that the markets will eventually correct many of the problems on their own- or at least they would, were it not for the biggest risk of all: bad decisions by political figures who chose to intervene too directly.

Political risk is seen as the element that could turn the current crisis into something far more prolonged. Yet, we face the current crisis bereft of political figures with any real understanding of the workings of the global economy. Even major policy formers in central banks have had to have the workings of the CDO market explained to them, and when looking at the prospective Presidents of the United States, ones heart begins to sink.

Meanwhile, the incumbent, by sabre rattling on Iran, could drive the price of oil far higher: with consequences that could simply destroy the US Dollar as a reserve currency.

As the US faces a credit crunch and property crash unprecedented since the Great Depression, too many Americans remain complacent.

Too many British fail to understand: the risks in the UK are now also approaching critical levels. A major Bank failure is still a real risk, and the bickering between the Finance Minister, Alistair Darling, and the Central bank chief, Mervyn King, over Northern Rock, do not bode well if and when that perfect storm hits the UK.

Friday, November 02, 2007

Grand Designs face down the NIMBYs

I must admit to being a secret fan of Grand Designs.

It puts forward an idea that is a very attractive pipe dream: the creation of a dream home, and as the subject of each programme meets the challenge of creating a home that expresses something of themselves, it allows the rest of us the fantasy that maybe, just maybe, we could do the same.

Last night I watched the programme that showed the presenter, Kevin McLeod's favourite design. It was, as is often the way with the designs selected by the programme to be filmed, highly eco-friendly. It was, unusually, built in a patch of woodland in southern England. How unusual that was was then made clear: no permissions are ever normally given in the UK to allow such construction. It was only because the builder was a Woodman who needed to be in the wood, for the sake of his livelihood, that any permission was allowed, but that he could not sell the house on, once built, and should he sell the woodland, from which he derived his living, he must demolish the house. It meant, of course that he could not borrow any money to fund the project, since the building had no market value. I must say this does offend my idea of rights to property, but the builder accepted the stipulation- and built it from his own resources.

To me, this brought home just how draconian the planning regulations are in Britain. As Marcus Brigstocke pointed out in his Radio Programme As safe as Houses , the fact is that the UK has an extremely small area devoted to housing- less than 7%. As you fly over the country, even the supposedly crowded South East England, the overwhelming prospect is not of a concrete jungle, but of how green the country is. As the population has grown, however, the availability of housing has fallen. Despite the headline grabbing large scale house programmes that were particularly proposed by the government in the past few years, relatively little is being built.

The Town & Country Planning Act of 1947 essentially nationalised the planning process, and like many other acts passed by the Attlee government, it is showing its age. Yet, unlike most other economic legislation, such as the nationalisation of coal, steel, the Bank of England, health care and so on, the planning regime has not been liberalised. In fact if anything the planning regime has grown ever tighter.

The result is that the market can not respond to the excess of demand over supply. It is not just a function of environmental impact- as the Grand Designs build shows, construction these days can indeed be exceptionally light on the ground. The problem is that the current regime is totally inflexible. The vested interests that Kevin Cahill points out in his book, "Who owns Britain?" have lost very little of their influence- and this influence is pervasive in the Green movement. A Land Tax might not only address the vexed issue of land use, but also reveal who owns the large unbuilt areas of rural Britain. This information is not public, as the result of a loophole in the law establishing the land registry.

The UK now faces a housing crisis: the cost of home ownership is beyond the means of an increasing number of Britons. Although house prices may now stall, as the result of the instability in the credit market and the prospect of recession, the structural imbalance will remain. The simplistic attacks that the right wing press have made on immigration being the root of this housing shortage conveniently ignores that fact that the Poles have brought with them many with the skills lacking in the domestic labour force: plumbing, not least. It also ignores that fact that the increasing demand is a function of far reaching social changes which have dramatically increased the number of people leaving alone.

Attempts to reduce demand will fail and can not solve the housing crisis. Only increasing supply can make a long term difference. However, this is not the same as "concreting over the South of England" that is the perennial warning of NIMBYs. In fact the easing of supply could be brought about with fairly small changes in land use- even a 1% increase in the land available for housing would dramatically alter the situation. At a time when rural life is declining: shops and pubs closing etc., the arrival of new residents in new houses could help to keep schools, pubs and other services open.

Those that refuse to allow any building are killing rural life in this country.

Yet politicians have found it easy simply to go with the NIMBYs.

The right position is to relax the draconian ban on new housing in the countryside.

I too have a grand design in mind. A wooden house inspired by Frank Lloyd Wright, set in a clearing overlooking the sea. It will also be a low environmental impact building, using the best of insulation and wood pellet heating.

However I will build it in Estonia- a place where the market works far more sensibly and where NIMBYs do not -always- have the last word..

Thursday, November 01, 2007

Playing with fire

There has been a lot of hot air wafted about recently on the subject of the relationship between Scotland and the rest of the UK.

Despite the fact that oil is now on the brink of $100 a bbl, support for independence in Scotland is falling rapidly.

Nevertheless a certain section of the English press is stirring things up. We see resentful headlines in the London Paper about supposed extra payments being made to the Scottish government merely because the long overdue investment in London's crossrail is finally taking place. The idea that Scotland is a whining subsidy junkie - indeed little more than a parasite on England- is gaining ground in England based on these wilfully misleading headlines.

Not surprisingly, support for English independence has risen, even last year reaching 30%.

Therefore the latest proposals from the Conservatives for addressing the supposed anomaly of Scottish MPs voting on English affairs is treading on very tricky ground.

This is not to say that no action is needed. In fact I and other Lib Dems would argue that major constitutional change is increasingly urgent. However the idea of the English Grand Committee does not address the real issue. Along with much else, local decision making across the UK was emasculated by the centralisation that began under Margaret Thatcher and came to full flower under Tony Blair.

Personally the answer to the West Lothian question is obvious: a federal Britain. The question though is whether either England should be a single entity, or that smaller units or regions are better. Many oppose federalism because they argue that regional government would be another, expensive layer of government. Yet a single English government, covering 50 million population seems so much out of line compared to Scotland with 5 million, Wales with 3 million and Northern Ireland with only 1.7 million.

Nevertheless it is undeniable that were the choice of a regional government was offered- in the North of England- it was rejected by voters. Nevertheless, I would argue that smaller units, rather than a single entity would put English affairs more firmly into the hands of the people it most affects. In Spain, there is no "one-size-fits all" federalism: several governments: La Rioja, Asturias, Murcia are based on a single county. My view would be to make the County the prime unit of English local government: the long history of each place makes local loyalties very strong. Many Counties have large populations: Surrey, for example has over a million people. Even smaller counties, such as Cornwall with about 500,000 still have substantial populations.

It strikes me that the grouping of counties on an ad hoc regional basis would happen anyway, if the need arose, but that it should happen in the traditional English evolutionary way.

At the end of the day, how the English rule themselves within the United Kingdom is a matter for the English people, but the problems that Malcolm Rifkind identifies are the result of too much centralisation. creating an English Grand Committee does not address that problem.

Fueling resentment with false stories of supposed Scottish profligacy, simply because the Scottish government chooses different policies that those imposed from Whitehall on England is the politics of the playground- and very dangerously negative.

Moving our government to a less centralised model is long overdue- having begun the process with devolution to Stormont, Holyrood and Cardiff Bay, we must now turn to changes inside England and to creating a genuinely federal system of home rule for Scotland, Wales, Northern Ireland- and England or at least those parts of England that wish for it.

The unholy alliance of the SNP and some Conservatives who wish for the break up of the Union can be challenged and indeed beaten but it is time that our constitution received a major overhaul.

Tuesday, October 30, 2007

Tyrant lectures Democrats

As the bloated entourage of the Saudi King decamps to London for a full State visit it is hard to suppress the gag reflex.

The Saudi regime corrupts all who engage with it. The disgraceful way that the UK has attempted to brush under the carpet the allegations of bribery against British Aerospace can not disguise the fact that the perfumed princelings of the House of Saud will always demand their cut.

Meanwhile the austere version of Islam- Wa'habi - that the House of Saud proclaims has created the murderous perversion of Osama Bin laden and his deranged acolytes. The oppression of women, and the barbaric punishments that a twisted and corrupt system of justice inflicts upon Arabian citizens are merely the most egregious examples of a backward and tyrannical state.

This vile regime, greeted with open palms by the British state already manages to lecture the British about terrorism. Of course the British know about terrorism because we have been victims of it. The House of Saud knows about it, because the system they have created has spawned it- of the 19 criminals of 9/11 we should note that 15 were citizens of the desert kingdom as is Bin Laden himself- and Saudi money funds Al Qaida and its imitators.

Taking a lecture from the gouty Saudi monarch really does make one reach for the sick bag.

Frankly I am astonished that only Vince Cable and the Liberal Democrats refuse to get on the Saudi merry-go-round. The boycott of this disgusting farrago is something that far more people should have become involved with.

The fact that BAe and others have engaged with this unstable and vicious state is a disgrace and something that they will surely regret- in the fullness of time, when the corrupt princelings are overthrown.

Yet again, as with Nicolae Ceaucescu, we have exposed the Queen to future ignominy.

Monday, October 29, 2007

How (not) to win friends

I see DC managed to infuriate the Lithuanians through a rather crass remark over the weekend.

On the one hand it seems a bit petty to get cross, but on the other there are 100,000 Lithuanians who Cameron clearly thinks are a bunch of layabout dole scroungers.

In fact they are mostly hard working, church going types.

Judging by this letter, they may have a sense of humour too:

"Dear Editor,

I see that David Cameron has suggested that one legged Lithuanian lesbians should not receive lottery or Arts Council grants.

I am pretty surprised that such bias can be openly expressed by a British Political leader in this day and age.

Admittedly, no one in the 100,000 strong Lithuanian community currently resident in the UK is aware of any one legged lesbians amongst us.

However, we are sure that should such a person exist and they had the relevant artistic talent then they would receive their grant based on the same criteria that a one legged lesbian Conservative would, namely through the quality of their work.

Lithuanians in the UK are often well qualified and working at the highest levels. Amongst our small business people is an exceptional group of hard working entrepreneurs- we are not the kind of people who ask for hand-outs, no matter how they may be deserved under your system. Indeed most of us during our stay do try to contribute to our host nation, through a myriad of church and community groups.

Perhaps Mr. Cameron should pay a visit to our beautiful country, where he will find one legged folk to be pretty rare, but where artists and performers are of exceptional quality even without the support of the British Arts Council.


Denis Serebriakovas"

Touche, Mr. Cameron...

Friday, October 26, 2007

The Political Class

I don't usually connect to Iain Dale, but I did find his interview with Peter Oborne extremely interesting.

The emergence of a political class is something that has left me profoundly uneasy.

Thomas Sowell's book, The Vision of the Anointed also, albeit from an explicitly right wing American point of view, evaluates the political effect of the clannishness of "liberal" politics- with the subsequent advent of American neo-conservatism, it seems appropriate to apply his strictures across the political spectrum.

I will write further on this, but watching Peter Oborne was a breath of fresh air.

Constitutional reform is an urgent issue, not a theoretical one.

Thursday, October 25, 2007

Serious Money

Senior Officials from the Fed are now saying that the losses in the US sub-prime market are already over $ 200 billion. There is the expectation that the losses will grow to the half a trillion dollar mark. The write-offs at individual Wall St firms are gigantic: Merrill Lynch announced losses of $7.9 billion yesterday. Bank of America saw a 93% fall in Investment Banking earnings, as they were forced to take over $2 billion in charges. What should really scare people is that as far as the US policymakers are concerned, the biggest losses are probably not in the United States. Nothing is clear, but European baanks may be sitting on losses that are even larger.

Meanwhile, the costs to the United States of the Iraq and Afghan wars are becoming a little clearer. The latest estimate is that by the time the hapless George Bush leaves office, in January 2009, the direct costs alone will have exceeded $ 1 trillion. The indirect costs remain opaque.

After the pasting in the credit market, American house prices have fallen dramatically. The emerging housing recession is only just beginning to have an impact on the US Consumer. Although the FOMC seems likely to call for a further rate cut, they now have to tread a fine line in order to avoid a complete collapse in confidence in the US Dollar- with a concomitant fall in global confidence. The short-run outlook for US Equities seems pretty bearish, and with a simultaneous crisis in credit and housing, the outlook is increasingly pointing to a full blown US recession.

Europe can not take much satisfaction from this, as it loses its US export markets and finds American goods globally more competitive. The strong links between the American and British financial markets are already showing up in lay-offs in the City of London. With continued losses emerging across the global financial system, London seems set to be hit hard. The consequences for the already overstretched UK housing market hardly need to be spelled out. At an historic average house price to average earnings ratio of above five, it seems clear that at least some of the US problems will come to the UK, despite the structural shortage of supply in the south east, which is the result of the nationalised planning regime.

Those that hope for China to take on the role of the United States as the locomotive for global growth do not take into account the export stance of the country, nor the extremely inefficient nature of the Chinese credit market. Chinese state banks, in particular, are thought to sitting on substantial bad loans in the local market, in addition to whatever exposure that they may have to the US sub-prime losses. Although the Chinese economy has continued to grow at a spectacular pace- now closing in on Germany as the worlds third largest economy, inflation is also growing, and the signs of overheating, as the result of a too lax monetary policy, are now increasingly plain. Meanwhile, despite the dramatic flight of the rural population to the cities, the demographics of the country will begin to tighten within the next five years, as the population actually starts to fall from its current peak of 1.3 billion people.

The emerging crisis in the United States is creating pressures across the global financial system, it is increasingly unlikely that an orderly handover of the growth baton can in fact take place. In other words we are coming to a major inflexion point in the global markets.

Over the past 15 years policy makers thought that they had ended the cycle: "an end to boom and bust" was the confident slogan of the Labour party. In fact we have just had an exceptionally long boom, fueled in part by excess liquidity in the US as the result of loose money and the resultant consumer boom (mitigated by the periodic collapse of speculative assets: Emerging Markets in 1997-1998, Tech stocks in 2001 and now housing).
We have unstable and tight markets in energy, especially oil. We have historic peaks in commodity prices, as we enter the peak of the cycle. We have an increasingly tight market for food, as nearly 30% of US corn production goes to ethanol and not to food.

However, after the long fat years, the cycle is inevitably reaching a peak and the increasing inefficiencies across the global market point to a substantial period of adjustment, while these distortions work their way out of the system.

In short we can expect an equity crash and a prolonged slow down in global economic growth.

Hold on to your hat- it is going to be an exceptionally volatile ride- the slightest event, such as the overdue Kanto earthquake in Japan could trigger major global market instability. As a board member of a mojor investment house said last week: its dangerous out there, I am seriously thinking that canned food and shotguns might be good invesments.

The political impact of the crisis is totally unpredictable, but I think we should certainly pay a special tribute to the 43rd President, George W. Bush: the man who seems certainly to have taken the title of the "worst President in American history" from the hapless President Harding.