Brexit: information spread thin

05/08/2019  


As the silly season drags on into August, the political agenda gets thinner and thinner, while that on offer seems to consist largely of reheated statements on matters that have long lost their bite.

At least the legacy media has a broken dam in Derbyshire and a brace of mass shootings in the United States to keep it busy, allowing it to scale down its Brexit coverage, just churning over the occasional derivative piece to keep the subject live.

If the media and politicians were honest with themselves, they would acknowledge that a no-deal exit on 31 October is pretty much a certainty. As long as Johnson is determined to pursue that course, there is precious little anyone can do to stop it.

That gives us 87 days left to speculate on the outcome of a no-deal, something which the legacy media is particularly bad at doing, with government and politicians not far behind in the prediction stakes. Generally, they have little idea of what might transpire, which is hardly surprising given that this is an issue where uncertainty is the dominant feature.

That, however, doesn't stop the likes of the Mail on Sunday churning out a derivative piece purporting to tell us what a no-deal Brexit "really means".

Setting out our future in 22 points, what strikes one about this exposition is that everything laid out seems to have been the subject of a legacy media story at one time or another. This paper certainly doesn't believe in original research and does not reach beyond the confines of its own industry to gather information.

The narrow perspective is shared by most of the legacy media and probably explains why they get it wrong so often and will continue to do so. Their inability to step outside their comfort zone means that their horizons will always be limited to what the herd has already approved.

Unsurprisingly, therefore, The Times finds that small companies "are still largely in the dark about trading relations with the European Union". This, it says, is despite government promises, apparently heedless of the idea that it is as much the media's job to inform as it is the government's.

Pinning the blame firmly on government, the paper harps back to one of Johnson's numerous promises during his first speech when he assumed the role of prime minister. Then, he claimed that "business will be ready" for leaving the European Union, which has prompted, we are told, "some hollow laughs from those who know the state of preparedness among small companies".

The reality, according to the Federation of Small Businesses (FSB) – which itself has never really been in the forefront of the information game - is that most of its members are "desperately under-prepared" for the no-deal exit that looks increasingly likely.

In my experience of the FSB as a one-time active member, and columnist of EU issues for its monthly magazine, is that you would have to go a long, long way to find a group of people so ill-informed, backed by an executive which seemed to specialise in burying their collective heads deep in the sand.

Nevertheless, The Times thinks they can hardly be blamed for their lack of preparedness, a view with which one must have some slight sympathy if one accepts that there is no clarity on exactly what they are supposed to be planning for.

The crucial issue is the basis on which Britain will work with its largest trading partner, and Johnson's determination to pursue a no-deal Brexit notwithstanding, the attitude among many companies has been: why waste time and money? And the fact that the government advice that has been provided to date has been pretty vague hasn't helped.

But then, as long as Mrs May was at odds with parliament, and dependent on a vote which would allow the UK to move to a "no change" transitional period, this was always going to be the case. Only since a no-deal has become a reality does it really make sense to start preparing – inasmuch as this is a realistic exercise.

Nevertheless, if we're now to believe what we're told, steps are being taken to address the inertia. Of the £2.1 billion that has been siphoned off from the unwilling taxpayer to fund no-deal preparations, £108 million has been set aside to "promote and support businesses to ensure they are ready for Brexit". This, we are informed, will include a "national programme of business readiness and helping exporters to prepare for, and capitalise on, new opportunities".

Businesses will doubtless be pleased to hear that they will also be included in a £138 million public information campaign to "get ready to leave", handled by the Cabinet Office – presumably under the tutelage of Mr Gove. The business department has been handed ten of the £108 million and the remainder will be handled by the Treasury on schemes that have yet to be confirmed.

Beyond that, predictably, details are thin on the ground – although this may be a reflection of the fact that government is as much in the dark as to the consequences of its own actions as most of the rest of us. This we saw with the recent leaked predictions which suggested that there were huge gaps in official understanding.

Therefore, the CBI and the British Chambers of Commerce, when they met Andrea Leadsom, the new business secretary, last week, should not have been surprised that they gained no further insight as to how the information budget might be spent. The most likely explanation for that is that Leadsom herself didn't know.

In a rather naïve comment, Martin McTague, the FSB's policy and advocacy chairman, nevertheless is bleating to the media that: "We urgently need more information about what this money is actually for", asking "What kind of support will it fund? How many small businesses will be able to access it? When will they be able to access it?"

Probably, those are the very questions that government might be asking itself, with little expectation of finding the answers. But the FSB, if nothing else, is always keen to suck up the occasional handout and has some ideas on how it could use the money.

Craig Beaumont, director of external affairs at the FSB, said that plans for a communications campaign to encourage companies to prepare may convince some to make a start, but he warned: "It is not enough to simply shout at small businesses. It must point to a set of impressive small-business-friendly online resources that can help a small business to work out what it can do to prepare for no-deal on 31 October".

The FSB is then joined by the Institute of Directors – another information vacuum – to ask for "Brexit vouchers" – a scheme that would allow companies to fund advice tailored to their operations.

The FSB suggests a value of between £1,000 and £3,000 to help people to "buy-in some expertise to help them to change their business processes". It expects specialist legal, staffing and compliance advice to be the starting point for the kind of help that companies will need.

However, apart from providing a bonanza for lawyers and snake-oil business consultants, it is hard to see what this might achieve. Mainly, it will be the blind leading the blind, as the detailed consequences of a no-deal Brexit will continue to be difficult to predict.

Another idea is financial support for stockpiling, helping small firms cover the cost of booking warehouse space, which will be expensive and in short supply. The FSB also wants the government to ask the big banks to show leniency if business customers struggle in the wake of a no-deal, and suggests that HMRC could give those hit by trade disruption extra time to pay their tax bills.

Another practical step, the FSB thinks, would be automatically to issue companies with the Economic Operator Registration and Identification (EORI) numbers that are required for trade with the European Union. Perhaps the Federation isn't aware that the numbers must be issued by EU Member States – but then one wouldn't expect the FSB to know things that might be useful to its members.

Perhaps the man who has it right is Tony Thompson, who runs a haulage company that runs to France daily from Dover. He is "fed up with this massive issue dominating our industry and causing problems", even before we leave. Thompson refuses to spend on planning for something that "may or may not happen", arguing that, "even if it happens, nobody knows what form it will take". He thus asks: "What can you prepare for?"

His view of the business support exercise is that it is "propaganda". He expects the money to be "spent on superficial projects, which will account for nothing, except maybe making the government look like they're doing something".

It might not be too cynical to assert that "looking like they're doing something" is what governments do. And with something like Brexit, where the information is spread so thin, there is little else that it is equipped to do.



Richard North 05/08/2019 link

Brexit: no-deal predictions

02/08/2019  


I wonder if it is a coincidence that an "internal government document" on the potential consequences of a no-deal Brexit has been leaked to Sky News, especially as the "document" is merely a single slide from a presentation made during the May regime – apparently during the last few weeks of her tenure, although we have no evidence of a date.

The slide (pictured above) bears the header, "What this could look like on the ground" and is marked "Official Sensitive- for discussion – not government policy". It apparently sets out a worst-case scenario, with summaries covering the first day, the first fortnight and the first month and was, according to Sky News, shown to some cabinet members but not the whole cabinet.

What strikes one of the first day scenario, though, is the superficiality of the analysis. Its assertion that "trade and passenger flows from the UK to EU slows" is undoubtedly correct, although it is unlikely that this will be because of "additional process at border" – which the slide suggests.

As we've discussed before, the 31 October is a Thursday, which means that the first day of Brexit will be a Friday – then, of course, followed by the weekend. The best guess here is that most businesses will hold off sending consignments to EU destinations for the first day, and even the following week, until they get some feel for the situation.

Thus, we expect to see a drastic fall-off in commercial traffic, driven entirely by business sentiment. The residual volume will probably present little challenge to the customs and other systems in EU ports, so it is most likely that delays will be minimal.

Another oddity in the slide is an assertion that "UK vessels could no longer have access to EU waters and vice versa", with obvious consequences for the flow of trade, and particularly the operation of ferries on the cross-channel routes.

That this is considered a potential problem is actually rather strange, as shipping access to maritime states is not directly an EU competence, with rights of "innocent passage" (which includes access to ports) guaranteed by the United Nations Convention on the Law of the Sea (UNCLOS).

Maritime states are permitted to impose certain conditions covering the access of shipping to their ports. This applies very much to the ports of EU Member States, where EU law sets requirements for pollution standards and safety inspections. However, these are dealt with in a Notice to Stakeholders, with the publication of a regulation covering the continuation of ship inspections.

Nowhere is it suggested by the European Commission that mutual access of shipping to ports, as between the UK and EU Member States, might be a problem, while both the Commission and Member States are working on the assumption that ship movements will continue.

This, therefore, raises some questions as to the authority of the Sky News "scoop". If this represents the best analysis the government has to offer, then perhaps we need to be worried about the lack of grip.

Nonetheless, the day-one scenario does go on to state that UK nationals in the EU "may lose access to services and resident rights", which could possibly be true. A number of Member States have drafted laws granting UK citizens in their territories rights to remain, but most of these depend on UK reciprocity, which has yet to materialise.

And on the matter of services, those UK citizens who provide services in EU Member States may find that the cessation of mutual recognition of qualifications prevents them from working, effectively rendering them unemployed.

This is not raised by the slide, but it does deal with Northern Ireland, stating that cross-border agricultural trade would "virtually stop" with other trade slowing, while the legal basis for the single electricity market "falls away".

Here, the first of these issues is entirely speculation. In truth, no one knows what might happen in Ireland on day-one of a no-deal Brexit. It is quite possible that, for a short period, Brexit proves a non-event while the relevant authorities work out what to do. And then, the implementation of restrictions may be a slow burn, with a long period of light-touch enforcement.

It is probably fair to say, however, that trade generally will slow down. In fact, this is already happening as Irish exporters look to buyers in the EU to replace UK trade.

As to the electricity market, cross-border transmission will doubtless continue. Even without a legal base, the relevant Notice to Stakeholders points out that Commission Regulation (EU) No 838/2010 provides that a transmission system use fee is to be paid "on all scheduled imports and exports of electricity from all third countries which have not adopted an agreement whereby it is applying Union law". This will apply to the UK, providing a mechanism – albeit less flexible – for the continued trade in electricity.

Then the slide confronts security issues, noting that UK law enforcement will be "working via non-EU security channels". Once again, this is already happening as the UK is being progressively excluded from Europol and is increasingly reliant on Interpol. The erosion of capabilities, though, is likely to be a slow burn and will probably not materialise as a major issue on day one.

Finally, for day one, the slide notes that there will be "volatility of currency and financial markets". Given the current slide in the value of the pound, this is almost certainly going to be the case, and may prove to be the dominant feature of a no-deal Brexit.

This brings us to the first fortnight, where the slide asserts that we could potentially see consumer panic and food shortages, "even in areas which are not directly affected at the border".

Given that panic buying could at any time strip stocks from the shelves, giving the impression of shortage even when there are adequate supplies, this dynamic could be a feature of Brexit at any time, even in the lead-in to 31 October. This is something over which the government (and retailers) have no control and much will depend on public sentiment.

In addition to this, we also get told that there could be possible friction at sea between UK/EU fishing vessels. This, though, I doubt, as vessels flagged with EU Member States will not be permitted by EU law to fish in UK waters unless there has been an agreement on fisheries management plans between the EU and the UK. A re-run of the "Cod Wars", therefore, is – in my view – low down in the order of risks.

More likely is the slide's assertion that unlawful data transfers may lead to enforcement action by EU regulators, leading to disruption of [data] flows. In fact, this is one of the understated risks of a no-deal Brexit, the impact of which could be colossal – bearing in mind that it usually takes much longer than a fortnight for EU regulators to act.

And then there is "continued volatility of currency and financial markets", together with the "potential for disruption of debt markets". These possibilities are undeniable.

Coming then to a month post-Brexit, the slide suggests that small businesses in Northern Ireland may face distress, and there will be potential law and order challenges. UK nationals may be unable to meet new EU Member State residency requirements and may start returning to the UK, or asking the government for help. And, on the domestic front, the heightened policing resource may prove unsustainable and operational gaps will "continue to emerge".

All of these are realistic possibilities, as will be sterling settling at a lower level, with near-term business disruption, leading to calls for support through operation Kingfisher – the government's "secret" Brexit bailout fund.

If anything, though, the slide shows just how difficult it is to predict the effects of a no-deal Brexit, or to rank the effects in terms of seriousness. One could also suspect that the authors had not read the European Commission's Notices to Stakeholders.

However, with the situation changing as Johnson is prepared to throw money at mitigating the effects of a no-deal, the most powerful take-away from this exercise is how poorly informed ministers were of the consequences. And this is likely to be the current state. The higher up the tree they go, the less they seem to know.



Richard North 02/08/2019 link

Brexit: Grayling in "ferry" land

03/01/2019  


The Grayling "ferrygate" story doesn't seem to want to go away, with most of the main newspapers carrying details of the Transport Secretary's interview on yesterday's BBC Radio 4 Today programme (2:18:51).

The papers seem to be making more of the story than did the programme, as the part dealing with Seaborne Freight was a very short segment in a longer interview, but none of the media seem to have addressed what in fact should have caused the greatest concern.

Right up front were the throw-away lines from Grayling when he responded to the subject by claiming that he was "expecting the Channel ports to operate normally in all Brexit circumstances". He'd had "detailed discussions" with his French counterparts and they wanted to keep the Channel ports moving freely. Thus, said Grayling, "I'm confident that will happen".

Had any sentient interviewer been confronted with such claims from the Transport Secretary, less than 100 days before Brexit day, one might have expected them to clear the decks and devote the rest of the programme to taking them apart. But this is the BBC we're talking about. The claims were allowed to pass unchallenged.

The point at issue though is that, under all Brexit circumstances, bar one – where the Withdrawal Agreement is ratified and we get a transition period – there will be very significant changes to port operations, with the absolute certainty that there will be serious delays arising from the UK's newly acquired status as a third country.

That the French want to keep the Channel ports moving freely should almost go without saying, but wishing something doesn't make it so. As recently as last June, the French National Assembly published a report on the Brexit negotiations, demonstrating a clear understanding that things were going to change, and not for the better.

Of special significance were the comments of Benoit Rochet, Deputy Chief Executive Officer, of the Strait Harbours Operations Corporation, based at Calais.

With two-thirds of containers and trailers from the continent en route to the UK passing through French Channel ports, the concern was that the facilities were used by so many heavy goods vehicles because of the speed of service.

Operators were very well aware that there would be a reinstatement of controls and that these could lead to major queues. Stacking the lorries was not the answer: if drivers lost two to three hours waiting in a parking lot, they would turn away from the route.

On import, though, heavy goods vehicles entering the EU would have to undergo checks. Customs controls were not the issue. Veterinary and phytosanitary inspections, done by the Border Veterinary and Phytosanitary Inspection Service (SIVEP), were far more serious, leading to a requirement to produce original paper documents. This was not problematical for goods such as exotic fruits crossing the ocean, but the system doesn't work when loading takes forty minutes and the crossing times are from a half to one hour.

As regards customs administration, the information required raised a technological issue. Because of the Single Market, very little information was obtained about what exactly passed through the ports. Rochet observed: "we do not really know what goes through the port of Calais". There is no control over the goods - except for certain customs security controls. No declaration is made a priori by the carriers.

Finally, Rochet says, some products require systematic controls. If the customs control between 0.5-1.5 percent of the goods, the products of animal or vegetable origin can give place to a systematic stop and thus to a loss of time.

Customs, he says, will be there 24 hours a day, but no SIVEP operation is open seven days a week, although we need them all. Given the nature of the traffic, we cannot tell our customers to make an appointment and, if there is no place, to spend the night in the parking lot until the next day.

Much more can be gleaned from the French newspapers, although far more than in the UK, reports seem to be hidden behind paywalls – despite generous taxpayer subsidies to the press. One gets the impression that the authorities and the port operators are only just beginning to wake up to the implications of a no-deal Brexit, and do not like what they see.

One truncated report talks of the "death-knell" for the Dieppe-Newhaven route – or even possibly an opportunity. Uncertainty isn't confined to this side of the Channel.

In a report on the Normandy ports, we see comparisons made. Most of the cross-Channel traffic passes through the port of Calais: nine million passengers, 1.9 million trucks per year. By contrast, the port of Caen-Ouistreham is a dwarf with one million passengers and 100,000 trucks per year, or 180,000 trucks if the ports of Cherbourg and Dieppe are added.

The Portsmouth line, run by Brittany Ferries – another of Grayling's beneficiaries - was only opened in 1986, but now two ferries operate three daily services, one of them double-rotating for a six-and-a-half hour crossing.

Antoine de Gouville, director of the port, states that: "Unlike Calais, where the crossing is very short, the economic model here is that the driver is resting during the crossing". The rest period counts throughout the journey, so it is of value.

Capacity of the ferries are between 1,700 and 2,000 passengers, 400 cars and 100 trucks. "Currently", de Gouville says, port administration centres around the loading process and the control of tickets, identities, etc. Those who disembark leave immediately, without checks.

With Brexit, he says, it will be necessary to "reverse the logic". Ferries currently disembark their hundred trucks in forty-five minutes. But even if just a documentary control taking thirty seconds is instituted, that takes fifty minutes more to unload. "These fifty minutes would make it impossible to double the rotation of the morning boat," says de Gouville. "The entire economic model of the operating company, Brittany Ferries, is at stake".

Then, he adds, there are the "Border Inspection Post/Community Point of Entry" (Pif/Pec) for products of animal and vegetable origin. Furnishing these Pif/Pec sites is the responsibility of Jerome Chauvet, in charge of the development of the port.

Because all food transport, of animal or plant origin, will require control, buildings and holding areas have to be provided, without really knowing the needs. The Agriculture Minister, Gerald Darmanin, says his administration is ready. "I want to believe it", says Chauvet, "but we still do not know how many customs and veterinarians we will have to supply".

The only consolation, he says, is that the ports like Calais or Dunkerque have the same problems, only bigger. If congestion arises from the intensity of their traffic, the Norman ports could profit from it.

With that snapshot, one at least gets the view that things really aren't going to be the same. Yet here we have Grayling saying that he is "expecting the Channel ports to operate normally in all Brexit circumstances". He then blithely talks of "putting in place a bit of extra capacity for the start of the Brexit process just to ease the pressure on the ports".

As to the Ramsgate contract given to Seaborne Freight, he makes "no apologies for supporting a new British business". The reality, he says, "is it's a tightly drawn-up contract that requires them to deliver. But I don't think there's anything wrong with the government supporting a new small business".

Asked about its absence of track record, he simply defended his action by repeating that it was "a new start-up business". The fact that the "start-up" had originally planned to have a service in place last March wasn't mentioned. Nor was it pointed out that the company was grossly under-capitalised and had broken every other promise it had made about starting dates.

Even with the Secretary being let off the hook by the state broadcaster though, this was Grayling in "ferry" land. If this truly represents the government understanding of the effects of Brexit on the Channel ports, then we are heading for disaster. The man simply isn't on this planet.



Richard North 03/01/2019 link

Brexit: more nonsense than sense

25/06/2018  


Time is running out to save thousands of jobs. That is the message on the Brexit negotiations sent to Teresa May, Donald Tusk and Jean-Claude Juncker, by five of the UK's main trade groups: the CBI, the Institute of Directors, the British Chambers of Commerce, the manufacturing organisation the EEF, and the Federation of Small Business.

Via the Sunday Times, we learn that this is a sign that "bosses are fast losing patience with the slow pace of negotiations". And now, they are demanding a greater input over the Brexit deal.

How seriously we are supposed to take this is not specified, but a clinical appraisal of these groups' inputs suggest that they have very little to offer. The latest EEF report, for instance, is incoherent, acknowledging that we are to leave the Single Market yet calling for (amongst other things), the ability to participate in developing harmonised product standards and continued adoption of European standards and technical requirements.

This is industry's own version of "cakeism" but, despite Airbus's recent entry into the fray, it is dwarfed by the ineptitude of the CBI which, on aviation regulation calls merely for the UK to continue to play a leadership role in EASA. There is not a whisper of the need to ensure continuity of certification.

In general terms (and all it can propose is generalities), it tells us it wants "a barrier-free relationship with our largest, closest and most important trading partner" and "a clear plan for regulation that gives certainty in the short-term, and in the long-term balances influence, access and opportunity".

Both the CBI and the EEF have called for Britain to remain in the EU customs union, while the Institute of Directors recently launched off into an excursion of its own, with "a hybrid option for a UK-EU trade framework". This went one better, in calling for a "partial" customs union, an idea so mad it has effectively taken this organisation out of the game as a serious player.

By contrast, however, the British Chambers of Commerce contribution to the well of human knowledge could best be described as slender. Its idea of reducing non-tariff barriers is that "Government must work with businesses to identify the most obstructive barriers, and collaborate with other countries to alleviate them".

That leaves the Federation of Small Businesses which, in its usual muddled way, also wants large helpings of cake to have and to eat.

In the immediate to short term, it wants the government to "secure the easiest and least costly access to the EU single market". This means, it says, a comprehensive trade agreement "securing barrier-free access, covering both goods and services, across all sectors". Its medium to long term objective is a free trade area of an unspecified nature.

Given the vacuity of the industry response to date – as expressed by trade representatives - one has to take with a pinch of salt their complaints that "their expertise is being ignored in favour of ideology". None of the five have yet to demonstrate an expertise, other than in the ability to craft endless clichés. "Frictionless trade with Europe is a top priority for their members", they say.

To that extent, it is quite understandable that Health Secretary Jeremy Hunt and another minister have been less than sympathetic to the pleas of business. Interviewed on the Marr show about the Airbus intervention, Hunt thought it "completely inappropriate" for businesses to be making these threats of the kind that Airbus had made.

Here, the focus is in the activities of individual companies rather than their trade representatives. And Hunt argues that "we are in an absolutely critical moment in the Brexit discussions", which means "we need to get behind Theresa May to deliver the best possible Brexit, a clean Brexit and what businesses want".

More dangerously, the Health Secretary seems to regard multinational companies as "siren voices", asserting that the European Commission "has got absolutely no interest at all in saying that these Brexit negotiations are going swimmingly".

They were, he says, "always going to be saying that this is going to be very, very tricky", to which effect the interventions of Airbus, BMW and Siemens are seen as "part of their negotiating tactics", against which "we have to stand firm".

In some ways, therefore, Airbus has played a relatively good hand quite badly. Although it may have a point about future investment decision, its more immediate concern is continuity of certification for its suppliers, so that it can ensure that its manufacturing is not interrupted.

Tactically, it might have been more appropriate to have concentrated on this issue. And while staying within the Single Market is one option that would keep the company in business. Under current law, there is also the possibility of the bilateral recognition agreement, which opened the way for Airbus to ask for a commitment to this, in the event that we do not stay in the Single Market.

In fact, the basic regulation on aviation safety has just been substantially amended, the new versions gaining approval in the European Parliament on 12 June. This new law offers a further option, empowering the Commission to adopt delegated acts which enable it to accept certificates from third countries, based on establishing "conditions and procedures for achieving and maintaining the necessary confidence in [the] regulatory systems of [those] third countries".

This is not much of a short cut, as it requires the third country to establish a formal working arrangement with EASA, a commitment to adopt the EU's aviation safety law in full, and the acceptance of EASA supervision and inspections – for which substantial charges are levied.

Nevertheless, outside the framework of the Single Market, there are now two potential options open to Airbus by which it can ensure the continuity of supplies, and it would have been perfectly legitimate for the company to ask the government for a commitment to explore either or both.

The issue then, would not have been about Airbus moving out of the UK (which solves nothing), but one of protecting UK jobs – the alternative being to source supplies from suppliers established in EU Member States. Rightly, the company could also have asked for detail for the UK government's plans to avoid congestion at the ports and delays in securing customs clearance – more legitimate area of concern.

Thus, we actually see a lack of tactical acuity on the part of the company, leaving it open to charges of political game-playing. That three international companies have done likewise, less than a week before the crucial European Council, lays them wide open to charges of "Project Fear 2", despite the legitimacy of their concerns.

That has opened the way for Economists for Free Trade and other idiots to write a letter to the prime minister, asserting that the European Commission is "deliberately deferring discussions on the UK's future trading relationship with the EU27 post-Brexit".

In the event that it continues at the European Council, the signatories, which include Lord Lawson, Peter Lilley, John Redwood, Owen Paterson and Kate Hoey, demand that the UK "formally declare that we are assuming that we will be subject to WTO rules from 30th March 2019".

This, they say, "would provide businesses with absolute certainty about the future and enable immediate steps to be taken to implement our independent trade policy". If, early next year, they add, "the EU then decides to come back to discuss free trade, this will be a bonus – but it is not and should not be treated as essential".

As always, we get the "stupid schtick", as the group asserts that countries "including the United States and India" do not pay to sell to the EU but successfully trade from outside. "The UK too", they say, "can do this without being a member of the EU through WTO rules".

Never mind the 38 EU-US listed trade deals on the EU treaty database, including the US-EU Bilateral Agreement of the Safety of Aviation which facilitates the trade in aircraft and their parts, and the smooth running of transatlantic air services.

The one thing we actually cannot afford to have with the EU, therefore, is just a free trade agreement. As Pete points out - in an excellent exposition - "free trade" is just a slogan. We need full regulatory alignment, or the kits representing aircraft with British parts will look like the one in the picture above – the only thing left for British industry to make (although they are currently made in India).

Yet still, there is more nonsense than sense talked, much of it coming from industry and much of the rest coming from the "Ultras" in their various guises. The lack of sense from government is only part of our problem.



Richard North 25/06/2018 link

Brexit: our plague of experts

30/12/2016  


Change Britain
brings out a press release masquerading as a report, which is then followed by the IPPR bringing out a picture book also pretending to offer serious commentary on Brexit (among other things). The author tells us:
Given the likelihood of significant new barriers to trade, a managed depreciation of the currency is also likely. A more mercantilist, interventionist political economy will drive sectoral change, increase consumer costs, and hit living standards. Socially, migration is likely to decline and become more controlled. Politically, Brexit underscored the UK's economic, social and cultural divisions and is likely to be the trigger for a decade of constitutional and political upheaval.
So, that is what we're getting from the London-based think-tank cesspit. It is a long time since have we expected anything original or coherent, and certainly there is nothing that would indicate that there is an adult presence at the helm. The Brexit debate is degenerating before our very eyes.

Even the great dragon slayer, Jonathan Portes is part of the public-funded UK in a changing Europe setup, which seems capable only of lacklustre offerings. Latterly, he relies on plagiarist Sam Bowman to make the case against Gove.

Portes, with co-worker Anand Menon, had taken Gove to task before the referendum on the issue of trusting experts, the pair "categorically" stating that Gove was wrong in asserting that people in this country have had enough of experts.

For their evidence, the pair relied on an Ipsos Mori poll on trusted sources in the referendum campaign. This put "academics" only just behind "friends and family" and alongside "small business owners" when people were asked: "Who do you trust on issues relating to the referendum?"

However, Portes and Menon are making a basic mistake in eliding "academics" and "experts". While the former may on occasions be the latter, we know from our experiences with Michael Dougan that this is not necessarily the case. In fact, ignorance is a frequent visitor to the halls of academe.

On this issue, my view is that they've all got it wrong. There are very few of us who do not trust experts in their own fields. I was, quite literally, prepared to put my life in the hands of a heart surgeon (although we did check his credentials first). Likewise, one assumes that the teams up front in the passenger jets taking us places are experts. We certainly trust them.

As I wrote yesterday, though, our real aversion is to the ranks of all-purpose experts – people such as economists and lawyers who may or may not be expert in their own fields, but who then trade on this slender base to claim expertise in far wider areas than is warranted by their qualifications and experience.

Many of these are "media tarts" – talking heads brought on to fill space with their opinions which most often have no basis in well-founded research – mostly used because they confer academic prestige to an otherwise unsupported argument.

The lack of expertise in academia is actually well-illustrated in the latest report from the UK in a Changing Europe, which hosts a galaxy of stars to inform us lesser mortals about Brexit, six months on, featuring once again Portes and Menon, the all-purpose "house" experts..

This, amongst other things, rehashes the same, trite, superficialities on the "Norway model", having Angus Armstrong, Director of Macroeconomics, National Institute of Economic and Social Research (NIESR), tell us that acceptance of EEA membership "implies acceptance of free movement". Dr Armstrong may be an expert macroeconomist, but he sure as hell knows very little about Efta/EEA membership.

On this, when I took my PhD, one of my supervisors was Jim Duguid. Author-editor of the seminal textbook on medical microbiology, he knew as much about microbiology as any man alive. 

Doing a favour for a journalist friend, I once asked Duguid to contribute to a story about a viral disease which was hitting the headlines. In characteristic fashion, he refused. He might have been a microbiologist but his specialism was bacteriology. He was not, he said, an expert in virology and would not allow himself to be called one in that context.

A bit of the same humility would be welcome from the Changing Europe academics, including Jonathan Portes, who writes in that latest report on immigration and free movement. Portes also works for the NIESR as a principal research fellow but his expertise is in economic policy - and he fails to make any mention of Article 112.

Portes, Menon and the whole rag-bag of authors Changing Europe have collected together are perfectly entitled to write about the subjects they do – as am I. But they are not entitled to call themselves experts on Brexit, or to imply that they are. They are not. As I have written before, there are no experts on Brexit. And on many issues in this area, their painful lack of knowledge is all too evident.

Now we hear that Portes and Gove are to debate Brexit issues. On current and past form, though, it will be the blind leading the blind, or a conversation with the deaf. Portes may be able to tackle Gove on his Big Lie, but then a ten-year-old could do that. In other areas, he will quickly be out of his depth.

Currently, Portes is arguing in the Guardian that we need a mature Brexit debate – and we're not getting it from Michael Gove. On that, he's absolutely right. But we're not getting a mature (or even informed) debate from academia either, and certainly not from Portes.

Interestingly, Gove has been quick to complain that Portes lacks humility, but that clearly cuts both ways. Putting these two together is going to be a fight between chimney sweeps. Politicians and academics both need to up their games. Neither group have got anything to shout about.



Richard North 30/12/2016 link

EU Referendum: the cascade system

06/10/2015  

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After physical attacks on journalists by protesters at the Conservative Party Conference, Ian Dunt, who calls himself a political journalist, writes for the Yahoo News blog in defence of the media. However, he does concede that people's anger about the press is not completely misguided. "Political journalism", he says, "is often a trivial failure".

The journalists "are far too often interested in tittle-tattle about leaders than they are the consequences of their policies", Dunt adds, also telling us that they also engage in political compromises of their own, in which they give average ministers good write-ups in expectation of stories in return.

But Dunt does not confine his criticisms to the media. "Those warped incentives", he says, "do not just lie with journalists, but with readers. The brutal truth is that stories about policy failure – the effect of welfare cuts, the reality of life in prison, the hardship faced by asylum seekers – does not get anything like the attention of a piece about the latest ministerial faux-pas or whether it's still OK to say 'first world problems'".

"The web", he reminds us, "offers editors unparalleled information about what people choose to read. If they read more investigative journalism – the kind which takes time and money – more of it would be written". 

And there, whether you like it or not, the man has a point. Editors read the runes: if it's read, they publish more of the same, and if it doesn't sell, material like it rarely gets a showing.

Perhaps an example of this comes with yesterday's flood of fringe events devoted to the EU at the Conservative Party Conference. One struggles to find any detailed reports of proceedings, while the Telegraph gives space (quite a lot of it) to Anna Soubry, minister for small business, telling eurosceptics to "get a life".

Whatever else, this is certainly an example of the trivialisation of political journalism, and yet another example of why the media is totally untrustworthy. And that is before even it ceases to pretend euroscepticism, changes sides and supports Mr Cameron's negotiation package when he reveals it to an expectant nation.

Discussing this problem with several people yesterday, in a day which seems to have been spent mainly on the 'phone, all are concerned that, as a result of this, a successful referendum campaign is going to have to bypass the media and deliver its message to the people unaided.

The obvious answer here is to use the internet. Some 92 percent of all households in the UK have internet access, so this provides a cheap and effective means of reaching large numbers of people, very quickly.

However, there is also an obvious limitation in the use of the medium, in that we are seeking to do more than simply convey information. We want to change minds and thereby get people to vote in our favour in the referendum.

But if communicating information was sufficient to achieve this, Ukip would be in government. It is a mistake to believe that putting facts in front of people is sufficient to change their behaviour. Even targeting specific people, with messages tuned to their particular circumstances and expectations, is not enough. And this is why the wizz-kid data miners and processors are going to fail.

This is because the crucial element needed in the mix is prestige – about which we have written a great deal on this blog, over term. People judge the importance and veracity of the information they receive not by its accuracy or the quality and attractiveness of its presentation, but by the prestige of its source.

In this referendum campaign, our main protagonist – as we keep stating – is not going to be the "remain" campaign, with its tawdry cast of nonentities. It is going to be the Prime Minister. And in this conformist, obedient society of ours, holding this office confers a great deal of prestige – a huge hurdle for us to overcome.

As the great guru Lynton Crosby tells the Times today, "Voters will be heavily guided by David Cameron. If he comes back from the negotiations in Europe and tells voters he has achieved a certain outcome that people should support I think that will be highly influential".

Favouring us though is the fact that prestige exerts itself in different ways. High-prestige characters (like the Prime Minister) can influence people from a considerable distance. But those with low prestige, such as friends, relatives and workmates, can also exert influence. However, it tends to have most effect at shorter range, and usually works between small groups.

Between distance and height, though, there is a cross-over. At very close range, a low-prestige person can over-ride a more distant high prestige messenger (distant in time or place, or both). Thus, the closer we get to our recipients, the greater effect we can exert. 

To do that, rather than employing the top-down, direct marketing techniques (whether physical or electronic), we are using what we call the cascade system, to get the message closer to the recipient before it is delivered.

The crucial element is this is the network of blogs we are building, each of which will carry the key messages through the campaign – and especially the response to anything the Prime Minister might communicate.

But the blog is much more than just a medium of communication. Through the comments sections and with the active participation of their authors, the aim is to build communities, with whom there should be a relationship of trust. The blog then becomes the lynch-pin of the community.

The next stage is for the readers themselves to form their own communities – through Twitter, Facebook, forums or YouTube, and through more conventional means, passing the messages onwards. That next layer then forms communities, and so on and so on.

In getting the message over, Crosby places great value on Facebook - but thinks Twitter is of little importance because it had little impact on ordinary voters. "Britain has the highest proportion of people on Facebook. We have targeted voters in marginal seats on Facebook", he says "Twitter is a different thing ... [it] does not influence ordinary voters. It's just the voice of the angry".

He's actually wrong, because he's in the top-down communications game. We see Twitter as an activists' tool, permitting "horizontal" communication, and a means by which we can all keep in touch.

And as a theoretical illustration of the potential power of the cascade process, we could assume a network of a 100 blogs, with an average readership of 1,000 (this blog already has 20,000, so we have a head start). That gives a potential "reach" of 100,000. And if each reader has 1,000 followers through Twitter, Facebook and various other means, that brings our total reach to 100 million – more than the entire population of the UK. 

Of course things don't work that way, but smaller numbers and a larger number of layers can still reach huge numbers of people. What we need is the system in place, the focus and message discipline.

The beauty of the system though is that it starts with a mere hundred blogs. Archimedes once said, "Give me a fulcrum, and I shall move the world". In this campaign, give us 100 good bloggers, leading their own communities, and we will win the referendum. We've already made a good start.



Richard North 06/10/2015 link

EU Referendum: invincible stupidity and frivolity

31/05/2015  

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For the first time since the general election result, we now see a newspaper report of an intervention by the Electoral Commission on the timing of the referendum.

The view of the Commission, we are told, is that May 2016 is too early for the referendum, which should not coincide with local elections. But it also says, according to the Independent on Sunday, that there should be a period of at least six months between the referendum legislation being finalised and the date of the poll.

Actually, it has already said that there should be a nine-month gap, so there is an apparent conflict in the reporting. Nevertheless, this most recent report establishes that there should be a fairly substantial period between the Royal Assent on the European Referendum Act and the poll – making a 2016 vote extremely unlikely.

This, of course, should already have been apparent to even the most intellectually challenged of commentators, but it hasn't occurred to the geniuses in the Fourth Estate. But it does not take a rocket scientist to work out that there are administrative procedures to complete before a formal campaign can start and then, for such an important constitutional issue, a reasonable time must be allowed to conduct the campaign.

Perhaps putting this into perspective is a book I have been re-reading on the London Blitz, by Constantine Fitzgibbon. He recalls the difficulty in organising the response to the expected air raids, one reason being "the invincible stupidity and frivolity of a large portion of the public".

This certainly applies in spades to the latest effluvia from Hannan who seems to have transcended his normal level of incoherence, attaining new heights of idiocy.

Despite the very obvious problems with the so-called "Swiss model" – of which the Europhiles are fully aware, this loose cannon is telling the public that voting "no" means "voting for a Switzerland-style relationship with the EU; one based on commerce and collaboration rather than political fusion".

For years, Hannan has been beating this drum, with no concessions to reality, heedless of the havoc that is going to be caused when there is a highly publicised spat between the EU and Switzerland over free movement of persons, only months before we go to the polls.

Hannan's own ego has now inflated to the point where any good he ever did for the eurosceptic cause has been undone by his wilful refusal to address his own intellectual limitations and accept that he's got it wrong.

As if this was not bad enough, though, Ukip in the form of Jonathon Arnott seems to be rushing to top up the fund of "invincible stupidity and frivolity", with an ill-conceived list of five reasons why we should leave the EU.

Never mind that an effective campaign requires that the reasons for leaving should mesh with the exit plan, so that we do not expose inconsistencies in our arguments which can be exploited by the opposition.

Any such tactical appreciation, however, is way beyond the capabilities of Ukip officials who, in any event, have not troubled themselves to prepare a coherent exit plan, despite the millions in EU funds on which they have enriched themselves.

As a result, Arnott advocates saving "£55 million+ of taxpayers' money every single day to Brussels", a promise on which we cannot possibly deliver, the usual mantra of "controlling our borders", which is both impossible and irrelevant in terms of limiting immigration; regaining the freedom to make our own laws – even though global trade and co-operation requires global rules – and the fatuous aim of stopping EU red tape and regulation "strangling our small businesses".

On the latter issue, Arnott should (but will not) listen to Cameron's own rhetoric on cutting red tape. This will be fortified by the European Commission's own initiatives which, if handled properly, send convincing messages to the politically uncommitted. Ukip's pathetic bleating will be drowned out – before even it becomes clear that the scope for reducing regulation is minimal.

To complete the line-up, though, we have Arnott telling us that if we leave the EU, we would be free to develop our global trade links and create new jobs. What he doesn't say is that his party's absence of planning would engender a desperate need to create new jobs – to replace the millions lost from Ukip's bankrupt policy on continued trading with the EU.

With this being the best that Ukip has to offer, I rather sympathise with the view of a noted campaigner, who recently told me he was reluctant to get involved in the referendum campaign. He was, he said, "tired of working with stupid people".

Yet, even to this day, the legacy media is vying to match the campaigners in the stupidity stakes. Way ahead currently is the Sunday Times, suggesting that the Europhile Boris Johnson should head the "no" campaign. "Invincible stupidity and frivolity" in this instance doesn't even get close, probably requiring entirely new words to describe the depths to which a once-serious newspaper has plummeted.

But if this is the way the campaign is going to be fought and reported, the temptation to walk away from it begins to look overpoweringly attractive.



Richard North 31/05/2015 link

Ukip manifesto: a new standard for gold standards

16/04/2015  

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We could not be bothered to fisk the Conservative manifesto – so low are our expectations. All we needed from them is to promise us a referendum and abide by the result. And that's what we got, with the added bonus of a commitment to repeal the Human Rights Act.

Ukip, on the other hand, is the challenger, so there are higher expectations. And since this is supposedly an anti-EU party, one expects it to come up with a comprehensive and realistic policy on the EU. But, given the amateurish nature of Ukip, that was never going to happen and, in their current manifesto, we are not disappointed. This is amateurs' night on stilts.

It starts with Ukip telling us that it believes British citizens should have an in/out referendum on our membership of the EU "as soon as possible" – a throw-back to Farage's stupidity in calling for a referendum this year – heedless of whether we could, or were prepared to fight and able to win.

And in a celebration of its amateur status, it then pushes for the question of choice to be: "Do you wish Britain to be a free, independent, sovereign democracy?” – something so vague and non-specific that it would never be approved by the Electoral Commission or Parliament.

Nevertheless, we have made some small progress. The manifesto explores the scenario following a vote to leave, suggesting we have "two legal options" – one is to repeal the European Communities Act 1972 and leave immediately and the other is "to activate Article 50 of the Lisbon Treaty and notify the European Council that the UK has decided to leave the EU in two years' time".

In fact, we don't have two legal options – we have one – to activate Article 50. And then, that doesn't involve us putting a specific time limit on it. But at least the party goes for the "second option", which "provides for a sensible, orderly exit and this is the option we prefer". This is progress indeed.

Then the amateur tendency comes to the fore. Having activated Article 50 of the Lisbon Treaty, the party says: "we will set a fixed date, two years ahead, on which we intend to leave, while recognising we could leave earlier". But that is not the way Art 50 works. The negotiations end when an agreement is reached – and although one has aspirations on timing, it is unwise to commit to a specific period.

Furthermore, concluding an agreement does not automatically take us out of the EU. It may well be that there is a short transitional period, so that we have a few months to put arrangements in place. We could – by way of an example – conclude an agreement in May 2020, but formally end our membership on 1 January 2021.

To give the party some little credit, though, it does want "amicable negotiations", with the "first step" being to "broker a bespoke UK-EU trade agreement".

But here the plan starts to fall apart. The belief is that the deal could be brokered "possibly within a very short period of time". Yet all the evidence points to a trade agreement taking five years or more – possibly as long as 10-15 years. There is virtually no chance of it being concluded in two years. What does Ukip do then? It has no answers.

Instead, all it has on offer are inherent contradictions. On the William Dartmouth "trade" page, we are told that: "We will continue to trade internationally after Brexit, enjoying the rights inherent in the WTO's 'Most Favoured Nation' (MFN) principle". A few pages later, though, on the "Brexit" page, we are told that "we will secure trade agreements with the EU, the 40 nations with trade agreements with the EU and other nations of interest to us".

As a "G7 member, a leading world economy, the fifth largest by GDP", we are also assured that "this will be a rapid process in most cases". Countries already trading with the EU "will want to continue seamless trade relationships; other world nations will want to forge new trade alliances with the UK; and all nations will find it easier to deal with the UK directly".

There is, of course, a major difference between arrangements where there are trade agreements and those which rely on MFN status. In the latter, we pay tariffs. In the former, trade is largely tariff-free. Yet, apparently, we are to "enjoy" both of these simultaneously.

Confusion, however, quickly descends to dishonesty. "As a minimum", we are told, "we will seek continued access on free-trade terms to the EU's single market. Our custom is valuable to the EU now and will continue to be so following Brexit".

But "access on free-trade terms to the EU's single market" outside EU membership is participation in the EEA by any other name – effectively the "Norway Option". The price of that would most certainly be free movement of people, which is the very thing that Ukip promises will end. The party is trying to have it both ways.

Furthermore, confusion and dishonesty doesn't stop there. "Excessive regulations stream out of Brussels, adding huge administrative and financial burdens to the challenges already faced by small businesses", says Ukip, which then adds: "All this must stop".

The party then goes on to say that fewer than one in ten British businesses trade with the EU, yet 100 percent of them must comply with thousands of EU laws on employment, waste management, environmental regulations, product registration, health and safety and so on. Ukip, therefore, "will repeal EU Regulations and Directives that stifle business growth", it says. It "will get us out of the EU and release enterprise from the strangulation excessive regulation".

One point, of course, is that Single Market access requires conformity with exactly with "the thousands of EU laws on employment, waste management, environmental regulations, product registration, health and safety and so on". Another point is that, under WTO rules on equal treatment, it is not possible to apply one set of rules to imported products, and more relaxed laws to domestic businesses. And nor would the EU permit two-tier regulation to prevail in countries which had Single Market access.

Thus what we have is a thoroughly dishonest - as well as an inconsistent - policy, even without taking into account the complete cop-out on the fishing policy. For solving "discard and landing issues", it offers only that we should "work with our fishermen".

To deal with asylum seekers, the party says: "We will comply fully with the 1951 UN Convention Relating to the Status of Refugees" - without acknowledging that this is at the root of the problem. And the party then claims also that it will "speed up the asylum process and seek to do so while tackling logjams in the system for those declined asylum status".

Some of that might be helped by the party's commitment to removing ourselves from jurisdiction of the ECHR, yet it doesn't begin to explain how we are going to remove failed asylum seekers back to their country of entry, when we stand outside the EU and its Dublin regulation.

And then tucked into the immigration section is what appears to be a bombshell. "We value and want to encourage tourism", says the party, so the "Migration Control Commission" will be charged with finding a system which enables countries with which the UK already has close ties, such as member states of the European Union and the Commonwealth, to establish reciprocal arrangements for visitor visas and term-dated entry passes.

There is no way of reading this, other than Ukip is proposing visas for visitors from EU member states, requiring us also to have visas to travel to countries such as France and Spain, and all other EU member states.

Then, to add even further to the incoherence, we come to the finances. Even though the party is going for Art 50, and two years of negotiation – with the probability of us not leaving until 2020 – Ukip claims to be saving £7.5 billion in 2017-18, £8.5 billion in 2018-19 and £9.0 billion in 2019-20. By its own measure, therefore, these saving are illusory.

But, in its "Brexit" policy, Ukip says there will be a wide range of issues on which we will want to continue to co-operate. These, we are told, "include extradition treaties, cross-border intelligence, disaster relief, accommodation of refugees, pan-EU healthcare arrangements and various other cultural projects". We will also, says Ukip, "maintain our membership of pan-European institutions, such as the European Space Agency and the European Medicines Agency".

This is actually sensible, but there is a cost involved. And, if we are to involve ourselves with the EU to the same extent as Norway, this – as we reported earlier could cost us as much as £6 billion a year.

For all that, no one really expected a Ukip policy to be anything but amateur's night out. It's almost comedic, therefore, having Nigel Farage boast that his manifesto sets "a new gold-standard for how manifestos should be produced".

I suppose, therefore, that this must means he's also sets a new standard for gold-standards - and a very low one indeed.



Richard North 16/04/2015 link

EU exit: the business of leaving

09/04/2015  

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The Mail is running a nice line about Tony Blair's "toxic intervention" in the election campaign, asserting that it has "backfired on Ed". In highlighting Labour's refusal to offer a referendum, says the paper, Blair has presented an open goal for the Tories, who are the only party to commit to a vote.

Less happy news, however, comes from City AM which is retailing the results of a survey of business sentiment and the EU. According to the research, conducted by Vistage, 61 percent of chief executives, managing directors and owners of small businesses would vote to stay in the EU and only six percent would vote for Brexit. Close to 40 percent of those surveyed said leaving the EU would hurt their business, and 58 percent expected Brexit to slow the UK's growth rate.

Just two percent of the "business chiefs" expected their company to be better off post-Brexit and only one in ten thought the UK's growth rate would increase. Thus, the Eurosceptic case that outside the EU businesses would be unshackled from Brussels red tape and better placed to tap into new markets found little sympathy among the respondents.

Furthermore, there are plenty of other surveys of this nature, viz one last month from the Association of Independent Professionals and Self-Employed (IPSE).

From 362 small business owners, it reported 49 percent believing that leaving the EU would be bad for their business. Losing out on clients located elsewhere in the continent and decreased access to finance opportunities are just some of the reasons that may have influenced this decision.

In contrast, just 13 percent of those surveyed deemed the effects to be good for their business, while 22 percent thought there would be no effect and 15 percent were unsure of the effect leaving the EU would have on their business.

However, as with everything, one needs to take these results with a pinch of salt. We note, for instance, a survey undertaken by McKinsey consultants, published in January 2015, which had 34 percent of directors admitting that they fully understand their own companies' strategies, and 22 percent claimed they are aware as to how their firms created value.

Given these findings, we may take it that business opinion on the EU is similarly ill-informed. Most business owners simply imbibe the "received wisdom" and have very little understanding of the issues. But this does illustrate how much work the anti-EU movement have to do to get the business community on-side.

It does not help, mind you, when our "side" come up with simplistic notions such as the "WTO option", where we give up any idea of negotiating a trade agreement with the EU, prior to exit. Those who would wish to experiment with insanity need to ask themselves what effect this will have on voters when they are asked whether they feel comfortable about leaving the EU.

And if we can't bring business with us, there is little chance that we're ever going to get majority support.



Richard North 09/04/2015 link

Brexit: Johnson – living on another planet

06/08/2014  

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We already know that Johnson is imbued with an ignorance of a profundity that only an expensive private education can buy, but one wishes he would not be quite so keen to parade it at every opportunity.

The particular opportunity of the day is the delivery of a speech at the Bloomberg headquarters in London, a significant venue as this is where Mr Cameron made his 2013 speech promising an in-out referendum.

First on the agenda for Mr Johnson is to thrill the collective hackery with a promise that he will seek re-election as an MP in the 2015 general election. His speech, however, attends the matter of renegotiating terms with the EU, and is seen as an attempt to destabilise David Cameron, presumably as part of a grand strategy to support a leadership bid in mid-2015 after Mr Cameron stands down, following his failure to win the general election.

But before anyone looks to this buffoon for leadership, they should look at the detail of his speech which, in essence, shows that he does not have the first idea of what he is talking about.

On leaving the EU, for instance, Mr Johnson tells us that, "we could negotiate a generous exit, securing EFTA-style access to the Common Market", thereby confirming that reputation for the most profound ignorance imaginable.

The point, of course, is that EFTA does not have access to the "Common Market", better described as the Single Market. The "NIL" group (Norway, Iceland and Liechtenstein) have negotiated access through the EEA agreement, while Switzerland has negotiated a series of bilateral deals, which owe nothing to either EFTA or the EEA.

This confusion we picked up on Sunday - which incidentally confirms that Johnson doesn't read the leading independent anti-EU blog, therefore making him less well informed than many of his voters.

Needless to say, the distinction between the deals forged by the "NIL" group and Switzerland is not academic, and nor is it trivial. As an illustration, we just have to take one of the examples Mr Johnson gives in his speech, where he seeks to portray the burden of regulation imposed by the EU. 

"Take the waste framework directive", he says, "that means all small businesses have to register as waste carriers if they want to transport a small volume of non-hazardous waste in their own vans – such as a nursery wanting to take grass cuttings or compost, they have to register as a waste carrier".

The point here is that, if the UK adopts the EEA option, it will find that the waste framework directive is part of the EEA acquis, so if Mr Johnson wants access to the Single Market via this route, he will have to accept the directive as part of the package.

However, if he goes down the Swiss route, the negotiating team will be dealing with such issues on a case-by-case basis, but then it took 16 years for the current level of agreement to be reached, one that is currently under review. Would Mr Johnson have our Article 50 negotiations lasting 16 years – or more?

The plot then thickens, because the requirement for businesses to register if they move their own waste did not arise specifically from the waste framework directive. In UK law, it only took effect this year, but as a result of an ECJ ruling after a case in 2006 taken against the Italian government.

Since the ECJ has no jurisdiction over the EEA agreement, arguably, this ruling could be ignored and Britain outside the EU could choose to interpret the framework directive in its original sense, and exempt businesses carrying their own waste from registering.

Necessarily, that will be for the lawyers to argue, but if we step back from the law and look at the practicalities, we find that all that is required is for businesses to register their details online, for which there is no charge imposed. This is a one-time registration that does not need renewal, and takes about 10-15 minutes.

In other words, one wonders what point Mr Johnson is trying to make. What is the big deal? And what is the point when he picks on the "EU Driving Regulations" for vehicles over 3.5 tonnes, which impose a complex web of restrictions on driving hours?

How are we supposed to solve the construction boom in London and get small firms coming to the market when we have regulations like that, Mr Johnson asks, the hypocrisy of his question almost defying imagination.

Talk to small builders in London, though, and drivers' hours are the least of their problems. What really troubles such firms are the costs of operating with Mr Johnson's congestion charges, and the huge burden of inflexible parking restrictions combined with the predatory activities of local authorities.

All Mr Johnson's speech does, therefore, is highlight the actions of an ignorant man trying to make political capital out of issues about which he knows next to nothing. And a man who does not even have a grasp of the basics is hardly one who can be relied upon to guide us through the labyrinth of an EU exit campaign, much less provide leadership.

In truth, Boris Johnson has nothing to offer us on the EU. One view is that he is promoting a reform package that will be impossible to achieve, simply to wrong-foot Cameron and give himself a political boost.

What he should realise is that people generally have had enough of posturing politicians, using peoples' concerns to further their own careers. Johnson's carefully contrived image is beginning to wear thin, and his attempt to use the EU as his own personal plaything are entirely unconvincing. The issue is far too big and much too important for Mr Johnson's games.

We really can do without them – and him.

FORUM THREAD


Richard North 06/08/2014 link

EU Regulation – empty games

24/10/2013  

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Entrepreneur Roger George (pictured above) employs 24 people at his shop in Brussels, which sells British goods, we learn from the BBC, which then has him complain that "red tape is a constant drain on his business".

The epic quote in the short film, though, is George blandly telling us: "We're not sure at times, whether it's EU generated or Belgium". This is a rather troublesome observation for a prime minister who, today, is taking a group of business persons to meet his counterparts at the European Council in Brussels, to complain about the very thing they know not from whence it comes.

For us at the sharp end, it is tremendous sport trying to work out the origin of any particular regulatory impost, with a huge range of possibilities to work from. Those who recall our book, The Mad Officials will know that, starting at the very bottom, we have a large number of official-invented requirements. Some exist as guidelines but some reflect only transient fashion amongst enforcement officials. None exist anywhere in any statute.

Next in the regulatory hierarchy is the mountain of nationally-derived law and only then do we have EU law. Some is transposed into UK law losing its identity, but much is now coming to us on the form of stand-alone EU Regulations. These, as every euro-nerd will know, have "direct effect".

In and amongst that lot, we have this curious creature known as "gold-plating", where the British government adds significantly to the burden, superimposing on the imposts from Brussels requirements of its own.

Then, hidden in EU law (and, indeed, our own), is the increasing heft of international or "soft" law. This originates in a myriad of agreements, conventions and treaties, the origins of which are often completely obscured, so much so that the Muppets in Open Europe seem completely unaware of its existence.

Despite this, the Great Business Leaders accompanying Mr Cameron to Brussels today are carrying with them a missive complaining of the burdens imposed on them. One of the greatest obstacles to growth, they say, "is problematic, poorly understood and burdensome European rules that all too often encumber business".

Thus do they declare: "It's vital therefore that any EU regulation necessary for the single market is pro-growth and pro-innovation, enabling not hampering businesses to create jobs and pave the way toward economic recovery".

Sadly, though, if you took these "leaders" aside, which include John Longworth, John Cridland and Simon Walker, respectively directors general of the British Chambers of Commerce, the CBI and the Institute of Directors, you would be appalled at their ignorance. Give them a representative selection of "regulations", and not one would be able to split them into their parts and identify the national, EU and international components. 

Then there is the matter of enforcement. Poor law, sensibly enforced, can be tolerable. But even good law in the hands of small-minded zealots can be a nightmare. Much of the burden small businesses suffer is through inappropriate or clumsy enforcement.

Overlaying this is the matter of regulatory philosophy. Broadly, there is a choice between prescriptive, tick-box style legislation and the broader, discretionary "goal-setting" approach. This is the difference between having a long list of detailed regulations on, say, workplace safety, or one general law - such as the requirement to maintain a safe, healthy workplace - leaving it to the businesses to decide what is necessary.

When it works properly, the "goal-setting" is undoubtedly better, but it imposes far greater demands on the skills and judgement of enforcement officials, and needs commitment from business proprietors. For this and a multitude of other reasons – not least the ease of performance monitoring – the general preference is for prescriptive law.

What one tends to find, though, is a Janus-like approach. Business will tell you it prefers "goal-setting" regulation, when it actually wants lax enforcement and freedom to cut corners. On the other hand, if the law is to be rigorously enforced, the certainty and predictability of the tick-box approach is often preferred, reducing the need to focus on the issues concerned.

But nothing of this will be discussed in Brussels. When you start exploring such matters with civil servants, with ministers and with "business leaders", their eyes glaze over. You see attention wandering, papers being shuffled and covert glances at watches. Very soon the interview is over and you don't get invited back.

This is not surprising. Regulation is a complex issue, encompassing law, human psychology, and any manner of technical and practical skills. Governments are rarely good at it and business neither understand it nor wants to put the effort into making it work.

The result, therefore, is what we see today – a glossy charade of silly men and women, more interested in grandstanding than in getting to grips with an issue which is entirely beyond them.

For them, there is some utility in being seen to be concerned, but there is absolutely no intent nor capability to solve any of the real problems of over-regulation. That would require hard work, understanding and the expenditure of a degree of political capital that no government – and certainly not this government – would dream of investing.

So it is that, as Mr Cameron goes to Brussels with his coterie of business people, he is wasting his time, theirs, and ours. And the whole world knows it to be a charade, which is why there is so little media or public interests. We have become weary of their empty, pointless games.

COMMENT THREAD



Richard North 24/10/2013 link

EU regulation: ignorance is bliss

14/10/2013  


000a EU-013 redtape.jpgGathering dust on my bookshelf is a 217-page volume entitled "Review of the Implementation and Enforcement of EC Law in the UK", an "Efficiency Scrutiny Report" commissioned by the President of the Board of Trade. I suspect that the only significant difference between this and the report to be issued tomorrow is the date – mine is dated July 1993, almost exactly twenty years ago.

Tomorrow's "landmark report" is entitled "Cut EU Red Tape", the fruits of a six-man panel, appointed by the Prime Minister in June, including Marks & Spencer chief executive Marc Bolland and former Diageo chief executive Paul Walsh.

That it is headed by the "great and the good" of the business world is no coincidence. It is one of Mr Cameron's obsessions that such panels are fronted by "slebs", when in days gone by, more sober, anonymous officials might have presided. In my day, the Scrutiny Report was overseen by Sir Peter Levene, then John Major's adviser on efficiency and effectiveness.

The publication of this report, however, puts "EU red tape" on the political and media grid for the week, and we thus see a trickle of related activities and an amount of press reporting, not least yesterday's report from the Sunday Telegraph, which has "business chiefs" telling Mr Cameron, to "cut EU red tape to save billions". This is matched by a Sunday Times report which has a panel of "top business executives" about to present David Cameron with "30 proposals for slashing the burden of European red tape".

Today's contribution includes a report from the EEF (formerly the Engineering Employers' Federation) and a poll, reported by Reuters and others, which tells us that: "Eight out of 10 British manufacturers would choose to stay in the European Union if a referendum on membership of the 28-nation bloc were held today".

Then we have a crass piece of bandwaggon-jumping by Matthew Elliott and his increasingly dire "Business for Britain", who gains support from City AM to tell us that British businesses "have been hit with more than 3,500 new European Union rules since David Cameron came to power", amounting to "13 million words of EU red tape". 

This is amplified in a piece in the Express which posits that "business owners" would have "lost 92 working days if they had attempted to read every regulation and directive handed down by the EU since 2010", another of Mr Elliott's stunning contributions to the debate.

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Ironically, Elliott chooses for his red-tape "victim", John Biggin, managing director of Northampton based vehicle sales company TruckEast. He is roped in to say, "We are currently battling through a myriad of red tape in the form of European Union Whole Vehicle Type Approval (EUWVTA) ", adding that, "This nonsense has resulted in many small businesses folding".

Thus does Elliott say: "The EU has an addiction to red-tape that desperately needs to be tackled. No-one would argue that a single market needs some regulation to function properly, but the volume and frequency of new directives being generated is a serious restraint to British businesses".

Then we get the money quote: "This why I welcome the formation of the government’s EU Regulation taskforce and its drive to identify the EU's most pernicious business regulations. The forthcoming renegotiation with Brussels must focus on overhauling its approach to regulation, for the good of jobs and growth in Britain".

The irony, of course, is that Whole Vehicle Type Approval is a matter between the EU and UNECE, with the EU working on a programme of international harmonisation which transfers lead regulatory authority to UNECE, as this web site informs us, with the statement: "Only UNECE documents determine the applicable law".

"Business for Britain", of course, wants renegotiation and reform, rather than withdrawal but, as we have seen, when it comes to a seat at the table, we need to leave the EU to get direct access to the World Forum for Harmonisation of Vehicle Regulations.

One might say, therefore, that this current initiative relies entirely on the ignorance of the likes of Elliott, of the media and then the public at large. There is no intelligence here, no understanding and no information. The arguments have not progressed and we seem frozen in time, rehearsing exactly the same issues of twenty years ago.

Meanwhile, the world has moved on, a fact to which the pundits seem oblivious. The EEA report, for instance, tells us that we need to stay in the EU, to give us "a strong voice in global agreements", which means, as with UNECE regulations, giving over our seat at the global negotiation to the EU. Nothing in the report recognises this, and nothing conveys any understanding of the way the global regulatory system works.

This actually accords with by broader experience. The top ranks of "industry" are most often filled by marketeers or bean counters. Neither have any feel for or understanding of regulatory systems, and their ignorance of EU structures and procedures is profound, with the role of global governance a complete unknown.

Thus to ask the likes of Marks & Spencer chief executive Marc Bolland, Heineken brand champion turned knicker salesman, is something of a joke. But then, the real action is going on elsewhere and it is probably no coincidence that the EU is also running a red-tape cutting exercise. As long as the media ignorance can be relied upon, these shallow, cynical initiatives can continue. In reality though, all we get tomorrow is another report to add to the collection.

COMMENT THREAD



Richard North 14/10/2013 link

Brexit: none of your business

07/09/2013  

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Some interesting observations come from Ruth Porter in the Daily Telegraph under the headline, "We're foolish to assume that big business knows best about our trading opportunities in the EU". And, in the wake of the feline dishonest from Lord Wolfson, we would find it hard to disagree with that observation.

Porter says it's no coincidence that some of the most strident business voices issuing dire warnings about the implications of leaving the EU are from big multi-nationals, such as Keith Skeoch, chief executive of Standard Life Investments, Sir Martin Sorrell, chief executive of WPP, and Peter Sands, the chief executive of Standard Chartered bank.

However, to judge from Ruth Porter's input, there is a huge temptation to assert that it would be equally foolish to assume that small business was any better qualified to pontificate about our trading opportunities in the EU.

In this, I was particularly taken with Mz Porter's comments about the effect of "a fundamental renegotiation of Britain's relationship with the EU". Asserting that a different relationship with the EU would most certainly not mean that companies in other countries stopped trading with us, she then suggests that if a fighter-pilot helmet manufacturer in Germany needed a certain component that is made best in the UK, it will continue to buy that part here.

It is fascinating that she should pick on an aviation component, and a military one at that. Production in this area is tightly bound by what is called "red-tape". The component would most certainly have to comply with national specifications, most probably joint (European) aerospace standards and – where applicable – NATO standards. Components for civilian aircraft would have to confirm with even more rigorous standards

But the point is that the trade would only take place if there was compliance with the relevant standards, which is a situation which would apply whether we were in the European Union or not - and most likely would be the same whether we were in or out of the Union. 

Further, whether we are in or out of the EU, we will still need a system of regulation and, while companies in general might bitch about the rules, they are not the only players. The fate of Turkish Airlines Flight 981, which crashed outside Paris on 3 March 1974, killing all 346 people on board, provides sombre testimony to what happens when regulator and industry get too close. The public and commercial interests do not always coincide. 

Even then, and more so now across a far wider field - as we are continuing to point out - regulatory standards are established globally (and especially the case with aviation parts). As the trend towards global harmonisation gathers momentum, membership of the EU increasingly becomes an irrelevance when it comes to framing standards.

Inevitably, the workings of regulatory systems are always going to be complex. Necessarily, they tend to favour the larger firms which can spread compliance costs across a wider product (or service) range and enjoy the benefits of scale. But that is not always, or entirely the case. Small firms can often react faster to changes in the regulatory environment, and exploit niche markets while the lumbering multinationals are still pondering about the lunch menus for their next series of board meetings. 

And there is also an upside to regulation. It should be recalled that one of the first attempts to introduce a formal system of meat inspection in the UK came in 1922 at the behest of the meat industry. This is evidenced by the Ministry of Health "Circular letter and memorandum on a system of meat inspection… for adoption by local authorities and their officers" (Circular 282). It referred to a "recent report" of the Departmental Committee on Meat Inspection, and drew attention to:
…the fact that there exists considerable diversity as regards both (a) the amount of meat inspection actually carried out in different districts; and (b) the standards of judgement and practice of individual inspectors.
Not least of the reasons why this situation was unsatisfactory was:
… lack of uniformity in these matters has the effect of imposing unequal liabilities on traders according to the standard of inspection adopted, and in localities where little or no inspection is carried out serious embarrassment is caused to honest traders owing to the absence of any check on unscrupulous traders.
It thus became the traders themselves who were the driving force behind establishing the entire system of regulation. Going back to aviation parts, a properly working regulatory system - which includes policing to root out counterfeits - protects not only the public but also bona fide manufacturers and dealers, airlines and other users.

Then, at an international level - as we saw with fisheries products - a common standard facilitates trade and actually reduces overall the costs of doing business. By no means everything about regulation is bad. To a very great extent, it is the lubricant which enables trade. Compliance costs are, therefore, a necessary price of doing business.

But how national and international regulatory systems work have, or should have, very little to do with the way we are governed. The fact that they are so closely linked in EU member states is the result of a confidence trick inspired by Jean Monnet, who devised a way of securing the political integration of Europe, disguised as economic integration.  He and his successors hijacked the international system of trading regulation for their own purposes. 

Thus, the great need is to decouple the formulation of trade rules from our general system of government. The one should not depend on the other. We do not need to subsume our Parliament and our laws to Brussels just so that we can trade internationally in aviation parts. The issues need to be decoupled.

But decoupling will not magic away the entire international regulatory system. It will still exist, and would have have existed even had the EU never been invented. Then, as to whatever regulatory system is devised and maintained, businesses – whether large or small – have a valid claim to be consulted and to be involved in the practicalities of their framing and implementation.

But as to the larger issues, the type and nature of our general governance, this – so to speak – is not the business of business. Business may have a right to expect a stable and predictable regulatory environment - insofar that this can be assured - but no business has any right to dictate how we, as a people, are governed.

That, of course, includes considerations of membership of the European Union. When it comes to whether we stay in or withdraw, as far as business is concerned, our message to these opinionated captains of industry should be: this is none of your business. 

Membership is not an economic issue - it is a political issue. Lord Wolfson - who has been so voluble on this matter - should climb back in his box and concentrate on selling his knickers - or whatever it is he does. As a shopkeeper, how we are governed is not his business    

COMMENT THREAD



Richard North 07/09/2013 link

Eurocrash: how times change

18/08/2012  

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Looking back to see exactly where this current crisis came from, it seems rather to have sneaked up on us. For instance, on the 10th anniversary of the euro, 1 January 2009, we got this delight (above) from the Independent.

Leaders of British small businesses, we were told, believed "the euro has been a success by a margin of four to one". This was according to a poll carried out by YouGov, which also found that "a clear majority believed the currency had a long-term future and that Britain should keep open the option of membership".

Although Labour and the Tories remained opposed to ditching the pound, the paper went on to tell us, the economic crisis had revived debate over whether it would ultimately be in Britain's interest to join the eurozone, which this day had acquired its 16th member in Slovakia.

But, by the end of the month, the Greek crisis was fully upon us, with a report that Trichet – then still ECB president - had been forced into repeated assurances that the eurozone was in no danger of falling apart, "despite growing stress in the Greek, Italian, Irish, Spanish and Austrian bond markets".

Amongst other things, this tells you a great deal about the fragility of opinion polls commissioned by partisan groups. This particular example was conducted for Business for New Europe.

It found 56 percent of "business leaders" believed the euro had succeeded since its launch, compared with 14 percent who thought it had failed. A total of 61 percent believed it was a sustainable currency in the long term, while 18 percent disagreed.

I guess you would not get the same result today.



Richard North 18/08/2012 link

The soap opera

08/12/2011  

In response to my piece on planting the flag, I had a note from journalist on a local newspaper. He told me the situation was so bad with his paper that, if there was a second coming, journalists would be required to ask of Jesus Christ himself what plans he had to help local community coherence.

But in addition to "planting the flag" or Londonising" pieces, it is as well to note that the other less than attractive habit of the modern journalist is to turn stories into soap operas. In such a guise, the actual issues take second place, merely a background to a narrative dominated by personalities, where the interplay between the characters is the dominant theme.

We can see this in the work of one of the pre-eminent gossip queens, Peter Oborne, who turns the complex issues affecting Cameron's response to the Merkozy treaty proposals into a classic soap opera narrative.

Looking at the developing situation, the man currently masquerading as our prime minister is under pressure from his own colleagues to adopt any one of three (or all) responses to the treaty proposals. He should either use the opportunity to seek the repatriation of powers, he should veto the treaty (unless he gets what he wants) and/or he should call a UK referendum, which presumably would reject the new treaty.

Assessing these issues, one can see logical and politically sound reasons why – from Cameron's perspective - none of these options should be invoked.

As to the repatriation of powers, we have a situation where, in an IGC, the chair, on the basis of a majority vote if need be – what we have called the Craxi doctrine - decides the agenda. And, in this case, it is very clear that only items directly related to the rescue of the euro are going to be considered.

Thus, Cameron has no means whatsoever of forcing his repatriation issues (if he actually has any) onto the agenda. His only remedy, therefore, it to threaten to veto any new treaty.

This option has also been suggested in the event that the treaty proposed ends up taking more powers from the UK and vesting them in Brussels – something which does not seem to be the case with the current Merkozy proposal. Cameron would have no direct grounds for a veto.

If, however, he invoked the veto because of a refusal to widen out the IGC and consider the repatriation of powers, he becomes the man who blocked the rescue of euro – and the man then responsible for the ensuing crisis.

Whatever one might think of Cameron (and I think we have made our views fairly clear), to expect him to do that is simply not realistic. This is not practical politics.

Likewise, a referendum might fall into a similar category. With the phrasing of the treaty proposal so far leaving the UK relatively unaffected, what would the question be? How about this?
European Union member states, including the UK, have agreed a treaty which is aimed at strengthening the eurozone. It does not take powers from the UK and give them to Brussels. Do you agree that the UK should ratify the treaty, or block it with the risk that the euro might collapse?
And just supposing something like that hit the streets, what do you suppose would be the majority response of the British people?

So, like it or not, action on three issues can be ruled out on the basic of sound political considerations, a calculus which does not have to take into account the personalities of those involved. The issues speak for themselves.

But that is not the way the British media works. Initially ignoring the issues themselves, Peter Oborne is able to turn the whole affair into a lurid episode of a "West Wing" style soap opera.

As "the flames of rebellion crossed the line from the backbenches into the Cabinet", he writes, "why on earth is the Prime Minister risking his career for the single currency, an ill-conceived monetary experiment which he has never supported and which he probably believes privately to be doomed?"

Against the backdrop of the flames licking the night sky, the first part of the answer to this mystery, we are then told, is Barack Obama. The Great POTUS is reaching down to The Boy, pleading with him save the euro. And, we are further informed, pleas from an American president (the latest in a private phone call yesterday afternoon) are hard to resist. The Boy rides to the rescue, all to save his hero in Washington.

Then there is the allure – or otherwise – of Nick Clegg. Europe is one of the great issues that could break his Coalition, and Cameron is determined that it should not do so. So The Boy must keep Cleggy on-side.

Only then do we get to the issues. Europe, writes Oborne, and conceivably the world, stands on the edge of economic calamity. If this week's "summit" goes wrong and the euro disintegrates, the scale of the disaster cannot be exaggerated.

In these circumstances, Oborne thus avers, the prime minister has one fundamental duty. "He must strain every sinew, make any sacrifice, to avert disaster. It would be a matter of national shame and disgrace if we toppled the euro over the edge by making too much of an issue out of working hours or the regulation of small businesses".

So, it is about shame and disgrace, on top of personal pleas from the US president, and a love-in with Nick Clegg. This is the world of Peter Oborne, from inside the bubble, every day a mini-TV series.

Would that politics was actually so entertaining, but then it is Oborne's job to make it so. The hard reality is, after all, so boring and what is a journalist for, if not to spice up reality a little bit, to make it more palatable? Why bother with issues, when you can populate your world with soap opera characters?

But then, the whole damn thing is artificial anyway. Says the FT, "Both the Tory sceptics and the euro-governments protest a little too much". Many of the sceptics just want a fight with Europe, it says, and seem to have little idea of how badly Britain could suffer economically, if the euro-zone crisis is not solved. But the Franco-German insistence that they have the perfect solution to the euro-crisis, if only the British would shut up and let them get on with it, is also deeply unconvincing.

Even more unconvincing, though, is the idea that this great "summit" is going to solve anything - and therein is the soap opera. One senses a certain weariness with it from the FT:
The package that is on the table in Brussels will not solve the crisis, but that is for reasons that have nothing to do with David Cameron's negotiating position. The problem is that it is not the "fiscal union" that is being spoken of – merely a new version of the old budgetary rules. And it also seems increasingly unlikely that the Brussels package will be used as a smokescreen or trigger to do what the markets really want – which is for the ECB to commit to huge purchases of Italian and Spanish bonds.

Next to these problems, an argument over Britain's role as a financial centre is really a sideshow. But I expect it will get plenty of coverage over the next 48 hours.
Nevertheless, one wonders why the hacks have to invent their own soap opera, when they had one prepared for them earlier.  Perhaps they needed to plant the flag on it.

COMMENT: "PLANTING THE FLAG" THREAD



Richard North 08/12/2011 link

Passengers of events

29/09/2011  

One might expect a medical practitioner to take a professional interest in the death throes of a patient. For most ordinary people, though, the experience is distressing and, where unduly prolonged, is weighed down with an element of guilt-tinged tedium.

That is where we stand with the euro, but as we hover by the deathbed in anticipation of the long-awaited demise, it is hard to decide whether the figure of the German chancellor represents the grieving relative, the physician – or even the assassin.

Scanning the huge rage of comment on the issue, I am cautious of pronouncing – or even offering analysis – conscious that in such tense situations, much of what is said and done by public figures is for effect. It may not in any way reflect the truth of what they feel or intend, and most probably does not.

A further problem – to which we have alluded many times – is that figures at the centre of a storm rarely have perfect knowledge or understanding. Rarely, in fact, do they have even the ability to decipher the very mixed messages pouring from the media and the many other sources.

Centre-stage for today though is the vote at the Bundestag where Merkel will have to face hostile parliamentarians and somehow convince them that she should throw another shed-load of money at the Greek problem.

Sentiment, we are told, "remains passionately divided". Some labour unions, oddly, are calling for measures to be supported, while the conservative Mittelstands und Wirtschaftsvereinigung (small business alliance) is urging deputies to vote "no".

The politicians themselves are hopelessly split, and up to 19 rebels from Merkel's CDU may change the parliamentary arithmetic in an unpredictable way. However, in a Duke of York sense, we have been marched to the top of hill and down again so many times that it is hard to know whether we are either up or down.

Whichever way the vote goes, though, it won't mean nuffink. And no amount of clever commentary or analysis is going to make any difference either. No one is in control any longer. The idea that "timely and decisive action" - even if it was possible – can pull us back from the brink is so much moonshine. We are all passengers of events.

COMMENT: "THEY KNOW NOTHING ELSE" THREAD



Richard North 29/09/2011 link

The very essence of the EU

14/04/2011  


After the fall of France, even while the Nazis had united most of Europe with the bullet and the bomb, the Führer was thinking of making this permanent, with a "new order". He had in mind a "European economic system", which would "sweep away the customs barriers, quotas, currency restrictions, wastefulness and inefficiency of an anachronistic capitalist system".

At the time, the idea so worried British and free European politicians that, as early as July 1940, they felt impelled to come up with something similar. Theirs, however, would be a Europe "united by goodwill and in friendship, not by force and in terrors". It would be a Europe based upon some federal system. Armaments would be pooled and trade barriers broken down. Each nation would be allowed to conduct its own affairs in its own way with the same kind of freedom as each state in the American Union.

That, at least, was the theory. Then along came Monnet with his ideas of covert political integration, using economic integration as the Trojan Horse, the stealthy, salami-slicing of member state powers, building them into the Commission's portfolio in a process called engrenage.

And all those years later, we have the Wall Street Journal reminding us that the process still goes on. Yet, despite copious literature which identifies exactly the game the integrationalists are playing, it is still treated as a commercial or a "trade" issue. There is ignorance, and there is wilful ignorance. This is the latter.

Thus, with yet another power grab on its way, we are told in neutral terms that the European Commission has "endorsed new laws" designed to create more of a "single market" for companies selling goods and services in the European Union. The most significant is a European patent system that "would slash the price of registering an invention in the EU".

That, of course, is the carrot – the "stick" is increased EU powers, given the name "competences" to confuse the poor darling journalists. And so do they gush that the patent proposal is one of twelve "priorities" set by the Commission, the EU's "executive arm", as it seeks to extend the EU's mission of creating a true Continental market of 500 million consumers". With EU economic growth lagging behind that of Asia and the US, the Commission hopes members will approve the plans by the end of 2012.

The EU's mission, of course, is to create an all-powerful government of Europe, but the Wall Street Journal and the others doesn't want us to know that. Hence we see the continued use of the term "executive arm", instead of "supreme government". The latter might just give the game away.

For those who can crack the code, however, Jacques Pelkmans, a professor at the College of Europe in Bruges, does precisely that. The single market "is the very essence of the EU. It's a permanent project", he says. And while the big projects like common tariffs and passport-free travel have been accomplished, he said, it is always possible to break down more barriers.

The College of Europe is, of course, where they train the spawn of the tranzies to become the next generation of eurocrats – thoroughly and completely brained-washed to take their place in the "new order". So Pelkmans knows what he is talking about – and so do we ... political integration.

"Even in the U.S. or Switzerland, people can get irritated that the single market is not as single as you might want," Pelkmans says, adding a dose of camouflage, to avoid being too revealing. But he tells us that the list presented yesterday is the EU's most ambitious single-market plan in a decade. It includes mutual recognition of college degrees and other professional qualifications, a carbon tax, common rules for online shopping, and a common loan programme for small businesses.

All of this, presented as economic integration, means more political integration and more power to the Commission. But it will never be discussed in those terms, by business, the MSM and, especially, politicians like Euroslime Dave. They are in favour of this sort of thing and are in collective denial, pretending to themselves and everyone else that political integration isn't happening.

Thus does our independence continue to gurgle down the drain, sold for a mess of potage and a European patent system. And we are not allowed to know.

COMMENT THREAD



Richard North 14/04/2011 link

Bye-bye democracy

09/04/2011  


Portugal will be offered a bailout worth €80bn (£71bn), European Union finance ministers meeting in Budapest agreed yesterday, but only if the parties contesting the country's general election in June agree to a package of austerity measures and reforms. So, the set up is that the politicians decide between them what the voters will be allowed to vote for, and only then does the election go ahead – with no choice offered on the substantive issues.

Does this sound terribly familiar?

UPDATE: And his Grace gets the point:
The EU is one great quango: it is a democratic scam which permits the politicians of each member state to promise the earth to get themselves elected, and then blame "Europe" that their manifesto pledges could not be fulfilled. This then permits each political leader to stare their electorates in the face and say, quite truthfully, "Our hands were tied; we could nothing about it; we were bound by our treaty obligations, etc., etc".
This is the point which the Little Englanders and the dyed-in-the-wool UKIPites simply do not get. The European Union is not a conspiracy of foreigners, to take over and rule Britain. It is a conspiracy of the ruling élites, on a European scale to by-pass democracy. Our leaders are part of it, it is them, the British political élites, doing it to us.

And this is, of course, why the élites love "Europe" so much. His Grace has got it absolutely banged to rights. The ritual "washing of hands" about "Europe" is all part of the act.

That is how scum like Cameron can prattle on about regulation, knowing full well that nothing substantive can happen, because most regulation is made in Brussels. But as long as he can go through the motions, with his patsies in the British Chamber of Commerce, the CBI, the Federation of Small Business (all of which were suborned long ago), and the media pretend everything is normal, then he can get away with it.

In our book, The Great Deception, Booker and I wrote of the slow-motion coup d'état - which is precisely what has been happening – and why the book is routinely ignored by the "great and the good". Slowly, slowly, almost imperceptibly, the organs of states, and the most important institutions such as the BBC, have been taken over. Our democracy has been stolen from under our very noses, not by those ghastly foreigners or the filthy Hun, but by our own élites.

A while back, I wrote:
We are a satellite state of the Greater European Empire, ruled by a supreme government in Brussels. We owe this government neither loyalty nor obedience. It is not our government. It is theirs. It is our enemy.
That is my "signature" on the forum. I left it deliberately vague – but the "government" to which I referred was not the one in Brussels. It is the one in Whitehall. We have been taken over. It is the enemy. We are its foe.

At least now, it is getting obvious. And at least now, more people are being to understand what is happening. At least now, we can start the recovery process.

COMMENT THREAD



Richard North 09/04/2011 link

Big "Climate" Brother

06/03/2010  

One of the more sinister aspects of the "climate change" miasma is the insistence of campaigners and governments that saving the planet requires personal sacrifice and significant changes in personal lifestyles. However, while we may be dimly aware of government exhortations along those lines, few people realise quite how much of our money is being spent on trying to make us change our ways.

A significant amount of that money is spent by one government department, DEFRA, on "behavioural research", and a record of its recent expenditure provides a chilling testament to the Orwellian world of climate advocacy, where every aspect of our lives is coming under official scrutiny.

The record, which starts in 2005, has the University of Surrey doing a project called "Choice Matters", exploring how to make sustainability "an automatic and primary part of producer and consumer choice, rather than a self-satisfying added extra." This cost a relatively modest £21,775.

For £63,017 meanwhile, the University of Westminster carried out an analysis of existing research relating to "pro-environmental behavioural change", aiming to contribute towards a better practical understanding of how DEFRA could influence behaviours.

Cranfield University, on the other hand, took on: "Sustainable development as a "collective choice" problem: theoretical and practical implications". The aim if this research was to explore thoroughly the potential of a highly promising and unique body of research, known as "collective-action theory", for achieving DEFRA's goal of finding new ways of motivating people to produce and consume in a sustainable manner. This cost a mere £23,333.

Exeter University was given the task of applying theories of behavioural change, using innovative techniques within the context of specific lifestyle groups. It employed a brand marketing approach to demonstrate how a model of environmental behaviour could be used to develop policies for change. The work cost us £21,000.

Other work went to the London-based "green" consultancy, Brook Lyndhurst, which was asked about "nudging the S-Curve". This shows an initial period of slow change; a period of acceleration, and rapid change; and a period in which change slows down as some sort of limit to growth is approached. This project sought better to understand the S-curve in order to promote pro-environmental behaviour change. For us, there was no change from £21,150.

Then, another consultancy, the National Centre for Business and Sustainability, got to do "Innovative approaches to influencing the behaviour of small businesses." This was to find out how existing mechanisms and approaches could be used innovatively" to influence the behaviour of small to medium-sized enterprises (SMEs) in a pro-sustainable development policy context." For that, we paid £22,225.

This earlier period also saw DEFRA investing in a behavioural survey commissioned from the British Market Research Bureau. At a cost of £458,440, this sought to establish then current public attitudes, knowledge and behaviour in relation to the environment, in order to provide a baseline for further studies.

At the same time, the department was exploring a range of issues and public attitudes, wondering, for instance, whether invoking the concept of "social justice" might help to lock in the government's view of environmental policy. To that effect, in 2006 it commissioned a report from National Economic Research Associates at a cost of £77,361.

More than a little of the work carried overtly Orwellian overtones, such as the project carried out by the Policy Studies Institute entitled: "Pro-Environmental Behaviour: Risk, Innovation and Reward." This sought to identify "potential directions and options for research exploring innovation, demonstration and learning on ways to increase consumer take-up of sustainable consumption behaviours." The cost was £25,169.

Not a little money was spent trying to assess the effects of DEFRA's own initiatives. Thus we find the department Brook Lyndhurst £82,980 in 2008 to tell it whether its online "CO2 calculator" is actually having any effect.

Half a million people had accessed the site but, it noted, "relatively little is known about why these individuals are logging on, how they are understanding and using the calculator, what they make of the results and whether or not this has any long term effect on their behaviours, whether positivie (sic) or negative."

The department also spent £109,710 asking Brook Lyndhurst to report on "Public Understanding of links between climate change and energy and food consumption in the home".

It then commissioned a series of reports, all on the theme of "sustainability". Nottingham Trent University got £59,971 for examining the "Public Understanding of sustainable clothing", with a view to providing indications of how changes might successfully be made in our "clothing culture". Looking at the finished report, few would appreciate just how much it had cost.

A firm called Synovate then got paid £64,277 for a report on, "Public understanding of sustainable water". Ipsos-Mori was paid to look at "sustainable investment", getting paid £54,150 for the work. And then the Policy Studies Institute got paid £12,220 to write a synthesis report, pulling together the disparate work.

Another venture was to explore "innovative approaches to achieving sustainable consumption", paying Brook Lyndhurst £59,770 to carry out some research. AEA Technology, meanwhile, was paid £77,971 to look at, "Household and economy wide impacts of changing environmental behaviours."

Surrey University was set on to investigate motivations for change, using six identified pro-environmental behaviours, for which it was paid £110,000, while Brook Lyndhurst was hired to gauge the role of influential individuals in social networks, at a cost of £77,800.

AD Research and Analysis was asked to do some methodology development, for segmentation, getting paid £19,950 for its trouble, then being rewarded with a £89,275 project on, "Unlocking habits to enable pro-environmental behaviours." Later, it got another £12,000 for more development work.

The Policy Studies Institute was given £115,323 to find out what "further" short term actions the public thought the Government should take to mitigate climate change while the EPPI-Centre was paid £93,304 to research ways of encouraging "more pro-environmental behaviour amongst SMEs".

For £58,380, DEFRA dreamed up another study, commissioning the New Economics Foundation to carry out a project called: Moments of change as opportunities to influence behaviour". This research explored whether "moments of change" – times in a person’s life where existing habits and behavioural patterns are disrupted – provided a significant opportunity to encourage the take-up of pro-environmental behaviours.

Brook Lyndhurst was asked to explore "catalyst behaviours", the idea that taking-up a new behaviour (such as recycling) may cause people to start another, or many more, beneficial behaviours. These, it was suggested, could be closely related behaviours or exist across a broader range of lifestyle activities. That cost a mere £78,365.

A synthesis report on food related consumer behaviours cost the department £75,320, which went into the coffers of AD Research and Analysis. It synthesised the evidence on the factors driving consumer food behaviours and "applied the findings in the context of individual behaviour change for sustainability."

Once again, the Policy Studies Institute was employed, this time testing "innovative approaches for achieving pro-environmental behaviours." It was paid £111,380. National Union of Students Services got a similar project, testing out the thesis on students living in halls of residence. As this was the first time they had moved away from home, the "significant lifestyle change" was seen as an opportunity for testing the effects of indoctrination. That cost £126,602.

Over the years 2008 and 2009, DEFRA followed through with the 2007 attitudes survey, commissioning a tracker surve from TNS Social at a cost of £187,695.

Now, Brook Lyndhurst is currently undertaking a project which tests a variety of techniques for encouraging "pro-environmental behaviour" in schools in Peterborough. The findings from the research will provide evidence to support more widespread promotion of pro-environmental behaviours in schools in particular, and through social networks more generally. That is costing £149,655.

The consultancy is also assessing green claims in marketing, for a mere £109,510. Simultaneously, for £130,391, the Policy Studies Institute is carrying out a review to ensure that key social research findings from a broad evidence base are accessible to natural environment policy and decision makers.

All this amounts to a relatively modest £2,574,376 – a tiny amount compared with general government expenditure and just a fraction of what a big corporate might spend on consumer research.

Nevertheless, this is still a significant amount of money, and it is actually just the tip of the iceberg. Other government departments are also commissioning research, and the research councils are spending many millions. The EU is spending a huge amount of money and much of the international spending – particularly in the US – is also being employed. I'll have a look at some of this spending in another post.

Crucially, though, this research has "guided" an increasingly expensive advertising campaign. According to official figures, spending in the financial year 2005-06 was a mere £661,120 and remained roughly static in 2006-07 at £627,216.

In 2007-08, however, spending escalated to £4,491,921 on "public engagement", while £650,307 was spent on a campaign called "Climate Challenge". And on the 1 January 2008, another campaign called "Act On CO2" was started. For that financial year, it cost £695,497 but, over 2008-09, costs soared to £12,185,373, bringing the total outlay to £19,311,434. Add the research and the grand total is close to £22 million.

For warmists though, nothing here will be sinister. But, to the rest of us, the idea that our government is spending our money changing our behaviour – especially on such a contentious issue where there is no popular enthusiasm for the changes sought – is getting far too close to Big Brother for comfort.

CLIMATE CHANGE – END GAME



Richard North 06/03/2010 link

Only another million

04/03/2010  


Shannon Love, over at Chicago Boyz picks up on the fatuity of basing our energy policy on "alternative energy".

"There exists no alternative energy source, no combination of alternative energy sources, and no system of combinations of alternative energy sources that can fully replace a single, coal fired electric plant built with 1930s era technology," he writes. "Yet many want to make this group of functionally useless technologies the primary energy sources for our entire civilization."

The theme is amplified by Wolf Howling, who makes more cogent points, referring also to this blog. We are voices in the wilderness.

Back in the "real" world, continuing my laborious (to say nothing of tedious) search on climate change spending, I happened on a press release from DECC. Of recent origin (18 January 2010), it tells us that "the Department of Energy and Climate Change (DECC) and the United Arab Emirates have today announced £1m of joint funding for renewable energy policy research."

DECC and the Masdar Institute, it says, have agreed to co-fund research which draws on domestic experiences of policy designed to promote renewables deployment. The research will support the work of the International Renewable Energy Association (IRENA) to advise nations on putting renewable energy legislation in place.

Eh? IRENA? Was is das?

And so, wearily, we track down a new monster, the International Renewable Energy Agency (IRENA). This article tells us about it, where we learn that:
After much hard work and advocacy by the German government and others, the International Renewable Energy Agency (IRENA) is now a reality. The two most important decisions for getting IRENA off the ground were taken at a meeting of IRENA member Governments, held in Sharm El Sheikh, Egypt, on 29-30 June 2009. The formal name: The Second Session of the Preparatory Commission of the International Renewable Energy Agency.
And this current little deal was put to bed during the World Future Energy Summit in Abu Dhabi, 18-21 January of this year (pictured above). A taste of the stitch-up comes with the rest of the DECC press release, which tells that "DECC and the Masdar Institute are also launching a partnership made up of government bodies and private sector companies to be directed and hosted by the Masdar Institute."

We also learn that the partnership "will develop, support and guide small businesses as they look to deploy low carbon energy sources on a massive scale. London-based sustainable financiers Earth Capital PartnersT have estimated a potential investment opportunity for the private sector of up to £2bn." Money talks once again, and we pay. But hey! It's only another million - for now.

More to the point, while we win the intellectual arguments, the machinery of government goes on regardless ... all of which puts the polar bear garbage in perspective. We get assailed by vacuous stories in the media, while the real news goes untold.

CLIMATE CHANGE – END GAME



Richard North 04/03/2010 link
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