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Showing posts from 2011

Downtime- Happy New Year

The period between Christmas and New Year always seems rather slow. The year is not yet finished, but I always feel rather reluctant to start something new, when I know it will be interrupted by yet another holiday- and also in my case, my return home to Tallinn. It has already been the longest trip to the UK this year, albeit that I have been here only 9 days. I find that I do not feel particularly alien- why would I? Yet I can not say that I am still in touch with the zeitgeist in Britain now. There is a comfortable familiarity in returning to old haunts and seeing friends and family. Yet I am more convinced than ever that Britain as we have known it is fading away. The country I grew up in - still reflexively thinking in post-Imperial ways- has given way to a shrill, sharper and more fearful place. Whereas the price of decline in the seventies was the final loss of empire, now it seems to be the loss of ourselves. The alienation of Scotland and England seems increasingly irrevocab

New steps

So thousands on the streets in Moscow... of course the health of a ninety year old Danish-Greek Prince may have drowned that out in the news in  Austria-Hungary  the UK. I have nothing against the Emperor Queen. However, the tide is changing. Nothing will happen while they still live. I wish all of us a merry Christmas, and I think 2012 may be a far better year, economically and politically than we fear now, yet I also believe that that we all need to think about what happens next. For that we need to think... but I see little evidence that we are.    

Disunited Kingdom

As London journalists contemplate the year ahead, a great number of them have finally begun to understand the high probability that now exists that the United Kingdom will not long survive. Few commentators, on either side of the border, seem prepared to make a principled case for continuing the common British state. Many, are increasingly inclined to welcome the idea that Scotland and the rest of the UK should part company. However, even if you accepted the inevitability of the break up, there is little thought being given to what happens afterwards. From the Scottish perspective, the advent of independence is currently being seen as a relatively small step. However, it would not be. The economic adjustment that wold be required to stabilize the economy of newly independent Scotland would be of the same kind of order as the adjustment that was forced on the post-Communist economies of Eastern and Central Europe. The banking sector alone would need significant changes, and will

Ed Balls remembered

The Shadow Chancellor of the Exchequer, the Rt Hon. Edward "Ed" Balls is a strange man. He, it is said, cries during Antiques Roadshow . Perhaps he should be more upset when he contemplates the political and economic legacy that Labour has bequeathed to the nation. Despite this slightly bizarre tendency towards the lachrymose, his reputation is uncompromising, even brutal. Not just his reputation. His latest journey into folie de grandeur is his invitation to Liberal Democrats - without, of course, their leader, Nick Clegg- to leave the coalition and join with Labour.  This would be the same Ed Balls who dismissed the Liberal Democrat negotiation team in 2010 with words of one syllable.  I think the response of the Liberal Democrats to his- hardly self-interested- invitation will be more or less the same words that he gave to David Laws in May 2010. Just so all Labourites know, it was Ed Balls who told the Liberal Democrats that they should support a coalition with

Piers "Morgan" Moron

Private Eye is well known as a satirical magazine, equally well known is their detestation of the pudgy former editor of the Daily Mirror, Piers Morgan. Morgan, for all his later appearances on television, is a pretty discount celebrity. He was, after all, heavily implicated in the " City Slickers " scandal at the Mirror. Although he was able to escape gaol at that time, he was not able to prevent his reputation being permanently tarnished. As a result- and rightly- ever since, he has been a figure of ridicule and contempt, at least on the pages of Private Eye. His turn as a judge on "talent" contest has been followed by another as an interviewer for CNN. always though, the results of his highly questionable activity as a British newspaper editor have been out there, waiting to trip him up. His testimony to the Leveson inquiry  was as mendacious and partial as we have come to expect from  this pustulous figure. Essentially he gave evasive half truths ( =whole l

Vaclav Havel: Pravda Vitezi

The motto of the Czechs- the truth shall prevail - has been used since the time of Jan Hus .  Yet for much of that time, the ancient lands of Bohemia, Moravia and Silesia have been subjugated to other Crowns. The Czech sensibility- cynical, non conformist and intellectual- is well captured in the English word "Bohemian" and is shaped by resistance to authority.  Since the fall of the Winter King  after the battle of the White Mountain in 1620, Czech leaders have often combined these rebellious qualities. Hus himself had previously embodied some of them, and so did the nineteenth century Czech nationalist, Frantisek Palacky . The writer, Jaroslav Hasek, completely captures the Czech sensibility in his immortal character, the Good Soldier Svejk .  All of which is a very roundabout way of saying that most international mourners of Vaclav Havel have not mentioned just how Czech he was. From his gruff, slightly woodwind voice with its strong Prague accent, to his complete de

'Bye Hitch

Christopher Hitchens has died. A brilliant polemicist, an extraordinary speaker, a thoughtful and determined contrarian. I did not agree with all he said, but the fact of his saying it was always interesting, challenging and valuable. He stoical attitude to the approach of painful illness and death marked him out as uncompromising and even- though he would have hated the word- courageous. He was a sparkling mind and a superb conversationalist and a determined seeker after truth, no matter what the implications of that truth. It seems pointless to say anything further to such a determined atheist, but his idiosyncratic views will be much missed, and perhaps that is praise and recognition enough.

Sarkozy: the bunny boiler

Well, of course the British press will respond to the gale of nonsense being pushed around by the Sarkozyites. The noise of discredited British "journalists", however, is nothing serious. What this drivel from Paris means though, is that France under Sarkozy has indeed decided that the French national interest is best served by there being not a rival to France for the affections of Berlin. The problem is that the obviously conflicted nature of the British relationship with Europe is more attractive to Berlin than Sarkozy's obsessive lurve-fest for Germany. Germany does not want a Federal Europe. Germany has therefore not delivered what Paris wanted, but instead of hating the thing which you love, the French have decided that "if only Britain was not around, then Germany would love us and deliver a Federal Europe": hence this absurd "declaration of dislike" against the UK. Of course the UK is financially weak, and almost all the French say is tru

What Britain could start to do next

The problem with British government policy is that the civil servants are still working to the New Labour Playbook. "Eye-catching" announcements are made, usually with recycled, rather than new money which are supposed to give the impression that the government is purposefully shaping the agenda rather than simply waiting on events. Almost always these announcements involve spending, and whenever any idea of restructuring is mentioned, the necessary retrenchment is typically ignored. Except, of course, that Britain needs retrenchment. The reason why so many voters now believe the welfare system needs reducing, is because they have seen that it doesn't work. Often it has created a skivers charter, and placed innumerable bureaucratic obstacles in the way of those who actually wish to get work. Huge amounts of money have been wasted. The core of British bureaucracy, ironically enough, lies not with the spending departments but with the Treasury. As I have noted before,

Football needs a longer spoon for these particular devils

Alisher Usmanov is a pretty "controversial figure". In fact the Russo-Uzbek tycoon initially made his money through acquiring control of large parts of the Russian metal industry at a time when that industry was one of the most murderous in the gangster world of 1990s Russia. He has gone on to acquire a very diverse set of holdings in Russia and increasingly outside Russia. In the UK he recently acquired Sutton Place, the former home of JP Getty. He has also acquired a large stake in Arsenal football club. Usmanov has been extremely close to the regime of Vladimir Putin, and although his Kommersant newspaper has not been entirely slavish to that regime, it has -in general- fully served the interests of both Putin and United Russia. Indeed earlier this week, Kommersant fired two editorial staff who has allowed the publication of stories that were highly critical towards the conduct of the disputed elections and the statements of the regime. Usmanov is and remains a loyal

I don't often agree with George Monbiot, but...

The press reaction to the events of the past few days has been to smear, to misrepresent and to outright lie. As George Monbiot points out in The Guardian today , journalists are now a lickspittle bunch of toadies for their society friends. The circle of journalists is so narrow that any independent thought is being crushed by an isolationist, very right wing groupthink. As the Daily Mail comes out with some variation on Lib Dems support for Europe taxing your granny to give you cancer shock horror and the Daily Express continue to find some spurious excuse to print a picture of Diana, it is hard not to feel a burning anger at the injustice that allows these poltroons to get away with their schtick. Of course the Lib Dems are right to feel that Cameron played to his Eurosceptic gallery rather than the national interest when he wielded a veto that could be ignored. However we also know, as does David Cameron, that if the UK is going to recover, then the Eurozone must recover- and re

Getting what you want in a negotiation

Interesting to note that David Cameron went to Brussels and has returned with no agreement and the dangerous fiasco of his ineptly wielded veto. Chris Huhne went to Durban and despite long odds, has returned with an unexpectedly strong agreement on climate change. I suppose the message is that if you want an agreement, eventually you can find one.

Nick Clegg steadies the ship

David Cameron went to Brussels but his use of the veto, which could have been justified in certain circumstances was bad from the point of view of strategy and pretty appalling from the point of view of tactics. His position was so last minute that he had not briefed even a single potential ally. The result was that we had no allies. Sarkozy laid an ambush which the UK walked straight into. The result was a catastrophic defeat for British diplomacy, which puts at risk not only our wider diplomatic reach, but undermines respect in Washington and Beijing. Neither has the veto stopped anything the EU26 now wish to agree among themselves without reference to the UK, so the defeat is total. In the UK the Europhobes' references to the Second World War have come thicker and faster than ever. Complete withdrawal is now seen as possible, even likely. So what Nick Clegg has started to do today is sensible. He has understood the fury amongst the Liberal Democrats at a defeat which is

Should the Liberal Democrats now leave the coalition?

As the scale of the disaster of the Brussels summit for Britain becomes clear, it is now an open question as to whether the Liberal Democrats should continue to be members of a government that has so spectacularly undermined the British interest. We have been openly derided, not just from the left, notably and effectively by  John Kampfner , but also mocked by the Europhobic Conservatives in a more infantile and insulting way. We serve two purposes in coalition: firstly to put forward and enact as much of the Liberal agenda as possible and secondly to save the Conservative Party from itself. The failure in Brussels shows that we can not prevent the Conservatives acting on their basest anti-European instincts. The damage that this will do to our country is severe and permanent. I understand that if we go to the country in a general election now, our party will be severely damaged. However I would far rather go now on a point of principle that is central to the Liberal Democrat c

Cameron's veto: what next?

The thunder of the Brussels Summit is only just fading, and it is still by no means clear what happens now. In many ways the summit has created more questions than it has answered.  However, there is no doubt that the relationship of Britain with the rest of the European Union has reached a point of fracture that places the UK outside the core of the organisation. David Cameron has, as he threatened, wielded the British veto, but the consequences were not what he intended. Instead of forcing the other 26 states to address British concerns, they have instead created a separate agreement without the participation of the UK. Although the British have- rather childishly- insisted that this group of 26 not use the facilities, even the offices of the European Union, the fact is that the Franco-German entente has  de facto  expelled the United Kingdom from the new direction of the European Union. The miscalculation that David Cameron has made was not to think beyond the veto. The UK did n

Why the UK has lost the Euro argument

The Euro debate in Britain takes place in a vacuum. The Euro-sceptics are not challenged, even when they start to resort to absurd national stereotypes and mentioning the war ("I think I mentioned it 73 times, but may have got away with it") in the most inappropriate contexts. The fact is that the image of Britain is so rooted in the Second World War, that we have become imprisoned in a national myth which insists on our unique righteousness and moral certainty. No one is allowed to mention the equivocation that created a culture of appeasement, the rise of the Blackshirts, or the real possibility that instead of "fighting alone" in 1940, a Britain under Halifax would have probably come to terms.  The problem is that the generation that actually took part in the war has more or less passed, and it is the post-war generation that mostly were not even alive at the end of the war that has created this pristine national myth. In the face of inexorable national decli

Mr. Cameron goes to Brussels

The weekly Parliamentary riot that is the British Prime Minister's Question time must have reminded Mr. Cameron how fractious his own party is, when it comes to the European Union. The problem is that the freedom of action that the government has on the issue is pretty limited. The Franco-German diktat, organised my "Merkozy" is pretty much the only game in town, since any proposal has to have the support of the German treasury. From the point of view of the UK, we have been outplayed and outgunned by the slippery French President.  That is... for now. Britain has been isolated for two reasons, one real, one a matter of perception. The first is that the UK did not an will join the Eurozone. The second is that British comments, however well intended usually sound like existential criticism of the Eurozone itself. However ignoring and isolating Britain on such subjects as the financial transactions tax may let backfire on "Merkozy", because they are not just

More on the Russian "election"

The background noise of protest in Moscow and St. Petersburg has continued , despite the severe clampdown. Over 1000 people have been arrested, which implies that the size of the protests is much larger than the few thousand that has been admitted by the regime. Significant figures amongst the opposition, such as the blogger Andrei Navalny, remain under arrest. The problem for the regime is that evidence is growing that the declared results are so far out of line with the real tallies as to be utterly at variance. This is not just a matter of the vote stuffing in Chechnya helping United Russia over the line- it seems that even the results in the major cities, which were thought to be more accurate because they showed such a large fall in the United Russia vote- are false too. In some areas it is clear that United Russia was well behind Yabloko, the Liberal party that the official tally says polled so few votes that they did not qualify for the Duma. While the state run television c

Russia starts to reap the whirlwind

The blunt political reality is that Vladimir Putin needed to cheat, even just to get the "sharply reduced majority" that is the official result of the Russian Parliamentary election. When we blow away the fog of the 99.9% results in some parts of the country, it is quite clear that United Russia lost the election. The problem now is, what comes next? There have been the largest street protests for many years in Moscow and St. Petersburg, and - as usual, these have been broken up by the thuggish internal security service. The future of Russia is not likely, in the short term, to be determined on the snowy streets of Moscow. However, there is no doubt that the weakness of United Russia opens up some serious future problems for Vladimir Putin' s bid for the Presidency. In classic authoritarian style, Putin is likely to try to prevent any credible opposition leader from standing against him, yet the weakness of United Russia may entice a few of the opposition leaders to

A word to Tim Farron's therapist

As a life-long Liberal I can not say that I share Tim Farron's professed need for therapy about the coalition. I am not a Conservative, I have never been a Conservative and I am not going to become a Conservative because of the coalition. Yet it is precisely because I am not a Conservative that I don't need therapy. For the first time in my life time, and indeed my parents lifetimes, Liberalism has a leading place in government. We have senior Liberal Democrat ministers who are leading the debate in this country, and more to the point are enacting Liberal policies .  Our ministers, with no little political courage, are enacting policies, such as the steady increase in the tax threshold to £10,000 which would not be enacted at all without our leadership. Sure government is not easy, and we have on occasion been outmanoeuvred - particularly in the early days, and notably on tuition fees, which cost us dearly. However, I see several announcements every week that show, while

Red Alert from the Bank of England

The Bank of England made the following statement this morning: In light of the continuing exceptional stresses in financial markets, the Bank of England is today announcing the introduction of a new contingency liquidity facility, the Extended Collateral Term Repo (ECTR) Facility. This Facility is designed to mitigate risks to financial stability arising from a market-wide shortage of short-term sterling liquidity. There is currently no shortage of short-term sterling liquidity in the market. But should that position change, the new Facility gives the Bank additional flexibility to offer sterling liquidity in an auction format against the widest range of collateral. Obviously this follows on from the coordinated action last week, but it underlines that the liquidity crunch that nearly took place carries risks for all non-US$ holders. The rumour that suggests that we came within a few hours of the total collapse of the short term funding market can only be reinforced by today&

What nearly happened in the markets last week makes my blood run cold

In the middle of last week, exceptional measures were announced by a coordinated group of six central banks : the Fed, the ECB, the Bank of England, the Bank of Canada, the Bank of Japan and the Swiss National Bank. In effect they agreed to supply virtually unlimited Dollar liquidity to the market. The result has been a sustained market rally over the past few days. However it is only now beginning to sink in what lay behind the central banks' decision and how close the financial system just came to collapse. It is now clear that the funding cycle, even for the best credits in Europe was getting dangerously short. Whereas a major industrial, like Unilever, could expect to fund US Dollar exposure for at least 30 days, by the beginning of last week, this was down to three days. If it was bad for industrials, it was becoming impossible for banks. US Dollar holders were not prepared to provide funds to several major Euro-zone banks at virtually any price. They were simply unable t

The devil in the detail of the Russian election shows Putin LOST

Now that we can see the final regional breakdown in the Russian election results, it is much worse for Putin that it initially seemed. The 49% vote for United Russia includes the tallies for non Russian republics, such as Chechnya, where the 99.9% support for United Russia is clearly false. Given that several districts in Moscow and St. Petersburg returned tallies of less than 25% for United Russia, then it seems like a reasonable working assumption that the majority of Russians in European Russia voted substantially against Putin. When we consider that the election was not certified free and fair, amid widespread intimidation and pressure on independent observers, it seems more likely than not that Putin actually lost this election.  This creates a crisis of legitimacy. Far from serving another two terms as President, it could actually be that this clearly fraudulent and stolen election marks the beginning of the end of the Putin era, even if not for the Kleptocracy that he h