Tuesday, July 5, 2016

The Great Divide



Well, that went well didn't it? I stayed up all night watching the results of the EU referendum come in. I hadn't meant to, because we had been told there was almost no chance 'Leave' would win it. But win it they did. It was around 1:30am when the result from Sunderland came in, showing a shock 61% in favour of leaving the EU. The BBC - that turgid voice of the senile elites - seemed unsure what to make of it. Surely this is just an aberration? I decided I'd better make some coffee for what promised to be a long night.

The birds had already been chirping for a couple of hours when the stunning result was finally announced. 48% had voted Remain and 52% had voted Leave. Hardly a huge victory, but a victory nevertheless in the teeth of the biggest domestic propaganda campaign in living memory.

And then the fallout began.

It's fair to sat that the reaction from those who didn't like the result has been somewhat disappointing and doesn't bode well for future crises. Now, 10 days later, with the rubble from the initial collapse is just beginning to stop bouncing, it appears that a huge chasm has opened up in Britain and the people are left standing on either side of it. The quiet hopeful dignity of most of the Leavers is in stark contrast to the shrill anger of the more vocal Remainers, for whom the sky has fallen in. There are demands for a second referendum, demands that the result be overturned and demands that the legal system be used to prevent the status quo being upset.

People are gnashing their teeth and wailing. I've heard of some holding grief parties, and others proclaiming that we now live in a fascist state. There is a frantic scramble to move to Scotland or Canada or some other state that is perceived to be 'tolerant and open'.

More sinisterly, in the immediate aftermath a media narrative has been allowed to flourish that a wave of race hatred has been unleashed by the vote. I don't buy it. Of course, you will get some racist idiots in any situation, and the videos of them I have seen tend to show drunk young men on public transport mouthing off. Does it make a difference to the statistics when newspapers such as The Guardian exhort their readers to send in their clips of racist/xenophobic attitudes and an app has been developed to capture such taunts? Would it make any difference if I said I had a friend who had openly talked on Facebook about travelling in a group to meet the returning England football fans from the ferry and provoke them into doing or saying something nasty for the benefit of the cameras. The temptation to be agent provocateur seems too tempting to some people.

To get an idea of the size of the gulf that's opened up it is instructive to watch these two short videos, one after the other. In the first one, Leave voters - who are more or less characterised as universally racist and/or stupid by Remainers - explain their reasons for doing so. The second video shows a woman in London explaining her fears following the referendum.

Video 1: Why we Voted Leave: Voices from Northern England

Video 2: Woman breaks down following Brexit vote

I'm not exactly a huge admirer of ex-London Mayor Boris Johnson - who spearheaded the Leave campaign (seemingly without much of a plan of what to do if victory ensued) and then quit when he won - but I'll finish off this short post by quoting what he wrote yesterday about the kind of feeling this referendum has unleashed in young people. Of course, Johnson is a buffoon and a joker and he revels in being offensive, but then jokers can say what they want and get away with it, so perhaps they deserve to be listened to sometimes.

"On Friday I heard a new dawn chorus outside my house. There was a rustling and twittering, as though of starlings assembling on a branch. Then I heard a collective clearing of the throat, and they started yodelling my name – followed by various expletives. “Oi Boris – c---!” they shouted. Or “Boris – w-----!” I looked out to see some otherwise charming-looking young people, the sort who might fast to raise money for a Third World leprosy project.

They had the air of idealists – Corbynistas; Lefties; people who might go on a march to stop a war. And so when they started on their protest song, I found myself a bit taken aback. “EU – we love YOU! EU – we love YOU!” they began to croon. Curious, I thought. What exactly is it about the EU that attracts the fervent admiration of north London radicals? It was the first time I had ever heard of trendy socialists demonstrating in favour of an unelected supranational bureaucracy.

In the old days, the Lefties used to dismiss the EU as a bankers’ ramp. Tony Benn thought it was unacceptably anti-democratic. Jeremy Corbyn used to vote against it in every division. Why has it suddenly become so fashionable among our nose-ringed friends? I tried to think which of the EU’s signature policies they were so keen on. Surely not the agricultural subsidies that make up most of the budget, and that have done so much to retard development in the Third World. They can’t – for heaven’s sake – support the peak tariffs that discriminate against value added goods from Sub-Saharan Africa. Nor can they possibly enjoy the sheer opacity of the system – the fact that there are 10,000 officials who are paid more than the Prime Minister, and whose names and functions we don’t know.

They can’t really be defending the waste, the fraud – or the endless expensive caravan of crémant-swilling members of the European Parliament between Brussels and Luxembourg and Strasbourg. Are they really demonstrating in favour of the torrent of red tape that has done so much to hold back growth in the EU? It seems an odd sort of campaign theme: what do we want? More Brussels law-making! When do we want it? Now!

Naturally, Lefties might want laws to protect the workforce – but they would surely want those laws to be made by politicians that the people could remove at elections. No: the more I thought about it, the odder it seemed. It was incredible that these young and idealistic people should be making a rumpus about the euro – the key policy of the modern EU – when that project has so gravely intensified suffering in many southern EU countries, and deprived a generation of young people of employment.

Perhaps, I mused, it was a general feeling that the EU was about openness, tolerance and diversity. But they must surely know that the EU’s rules on free movement mean a highly discriminatory regime, one that makes it much more difficult for people from outside the EU to get into Britain – even though we need their skills.

So what was it about? People’s emotions matter, even when they do not seem to be wholly rational. The feelings being manifested outside my house are shared by the large numbers of people – 30,000, they say – who at the weekend came together in Trafalgar Square to hear pro-EU speeches by Sir Bob Geldof. There is, among a section of the population, a kind of hysteria, a contagious mourning of the kind that I remember in 1997 after the death of the Princess of Wales. It is not about the EU, of course; or not solely. A great many of these protesters – like dear old Geldof – are in a state of some confusion about the EU and what it does.

It is not, as he says, a “free trade area”; if only it were. It is a vast and convoluted exercise in trying to create a federal union – a new political construction based in Brussels. But, as I say, I don’t believe that it is psychologically credible to imagine young people chanting hysterically in favour of Brussels bureaucrats. The whole protest is not about the EU project, per se; it is about them – their own fears and anxieties that are now being projected on to Brexit.

These fears are wildly overdone. The reality is that the stock market has not plunged, as some said it would – far from it. The FTSE is higher than when the vote took place. There has been no emergency budget, and nor will there be. But the crowds of young people are experiencing the last psychological tremors of Project Fear – perhaps the most thoroughgoing government attempt to manipulate public opinion since the run-up to the Iraq War.


When Geldof tells them that the older generation has “stolen your future” by voting to Leave the EU, I am afraid there are too many who still believe it. It is time for this nonsense to end. It was wrong of the Government to offer the public a binary choice on the EU without being willing – in the event that people voted Leave – to explain how this can be made to work in the interests of the UK and Europe. We cannot wait until mid-September, and a new PM."

Tuesday, June 14, 2016

Why Leaving the EU is the Ethical Choice for People and Planet



As we near what is probably the most important vote any of us will ever cast in our lives the rhetoric on both sides of the debate over whether the UK should remain a part of the EU has been cranked up to 11. A debate that should have been about so much more has become a schism between two rival branches of the Conservative Party. Each side goes on television daily to spit out venomous insults and apocalyptic warnings while their backers in the media cheer and jeer these poor blabbering idiots. Go online and it's even worse, with keyboard warriors screaming insults at one another with all the decorum of two rival troupes of caged chimpanzees fighting over a bucket of EU mandated straight bananas.

Welcome to debating in 2016! 

Any sane person, who has so far managed to avoid being dragged into the melee, might decide to quietly make up their own mind and keep their decision as a secret to be shared only with the ballot paper and the pencil. While this might be a sound tactic from a personal point of view it doesn’t do anything to add to the quality of the debate that we are supposedly having. One of the major irritations of all this is its intense focus on factoids and irrelevant details. People might not have an opinion on – say – the way in which unelected technocrats were installed as leaders in Greece and Italy, but they sure as hell have an opinion on the comparatively paltry amount the UK gives to the EU every month and what it gets back in return.

This relentless focus on the little stuff doesn’t say much about our own leaders’ opinion of our intelligence levels. Perhaps it might be wiser to pause and think about the wider principles involved in this important matter of national sovereignty. How, for instance, does the larger system of the EU function? 

To get a little peace and quiet in which to think we’ll need to lock away the blabbermouths for a few minutes. Imagine, if you will, a large Monty Pythonesque hand descending from the sky and picking up all the noisy rabble and dropping them unceremoniously in a large sound-proofed box. There goes David Cameron, picked up by his necktie and dropped in the box. Boris Johnson is next, winched unceremoniously by his big toe and similarly chucked in, as is Nigel Farage, Michael Gove, Tony Blair, Gordon Brown and all the other noisy politicians. But the hand doesn’t stop there. It scoops up great crowds of people angrily shouting “racist!”, “idiot!”, “liberal Islington elitist media whore!” and all sorts of other rude insults. Into the box they all go, squashed down together so the lid can be shut. We don’t know how they’ll all get on inside that box but at least it’ll quiet for a few moments on the outside.

Phew! The sound of silence.

Right, now let’s think about the EU. What is it? Well, it’s a collection of countries in a shared geographical area that have all agreed to be governed under a similar set of rules in order that it will be of benefit to them all. The objective in this case is increased political stability, steady economic growth and a shared European identity. Fair enough, right? Does this mean it’s all good, as many claim? No – of course not! By definition there will be good aspects and bad aspects in any system of governance of this size, although me mustn’t forget that the concepts of ‘good’ and ‘bad’ are entirely subjective.

["Hmm. Well, I avoided being put in that box, but if he thinks he can change my mind he's very much mistaken. I hope this isn't going to take long.]

What's that? I can hear some of you talking at the back. I'll take questions afterwards in the comment box below.

Okay, in the interests of disclosure you might have noticed from the headline - Why Leaving the EU is the Ethical Choice for People and Planet – that I am have an opinion on the matter. Good! I don’t claim to be neutral – anyone who does is smoking their shorts. On an important matter like this we must all individually construct our own model of realities, examine our own prejudices and reach a conclusion that is acceptable to ourselves and others. If you disagree with me that’s good too! To agree with every aspect of everything you read on the internet is not a good indicator of mental fortitude. I know a lot of people are sceptical but don’t worry – I’ll respect your opinion just so long as you respect mine.

Right where were we? Oh yes, the wonders of Europe.

So far so good – who could possibly object to a vision of a united Europe? Not I, for one. It’s impossible not to love Europe. Far more than just a medium-sized geographical peninsula tacked onto the western edge of the Eurasian landmass, the countries of Europe have it all. Here are some of the things that make Europe great: food, art, history, culture, geography, sport, philosophy, music, architecture, amazing food, language, the people, poetry, literature, delicious regional food, snow covered mountains and fascinating cities (did I mention the food?). You can drive, as I did once, from the frozen blue of the Baltic and keep on going south until you hit beaches lined with palm trees where the air is filled with the scent of orange blossom and the sound of cicadas. I fell in love with Europe whilst Interrailing when I was 17 years old. It all seemed impossibly romantic compared to life back in grey old Blighty, and in subsequent years I have found myself living in three different countries in mainland Europe, and running small independent national newspapers in two of them. I speak three European languages tolerably well, am married to a Dane, have relatives in Italy and think that Scandinavian noire beats all the other noirs hands down. It’s probably fair to say that nobody could accuse me of being anti-European.

But. 

(I can sense some of you tightening your sceptical fingers on the trigger.)

[“Here it comes – he’s about to reveal himself as a closet xenophobe!” ]

But the EU is not Europe.

[“Hold your fire. Just let him finish.”]

At one point in time the EU – or the EEC as it was called back in the day – might have aligned with whatever values of Europe it was supposed to reflect. Those days are long gone. Instead we have a bloated imperial project that has run out of steam and is feeding off its own internal organs to stave off collapse. To understand why we’ll need to turn to the dismal science of economics. I can hear some of you groaning but I promise you it won’t be too painful.

[“What does he know about economics? He’s just as full of it as all the rest!”]

I studied economics at university in London. I can’t say I enjoyed it, but at least it taught me a thing or two about how the modern capitalist world functions. I was sent to work at the H.M. Treasury on my student placement year (yes that Treasury), where I worked in the economic forecasting department. Norman Lamont was the chancellor at the time and I left there the Friday before Black Wednesday. It was during this time that I got my first lesson about the EU. My undergraduate dissertation was entitled The Prospects of Achieving Full Monetary Union in the EU (it was a real page turner). I got loads of books out from the library at the Treasury and read them in an attempt to understand the issues. But the more I read the less I understood. Eventually, flummoxed, I decided to go with common sense. It would be impossible, I decided, to get all those vastly different countries to dance to the same economic tune. How could economic diktats dreamed up in Brussels be relevant to both a fisherman in Greece and a desk jockey sitting in, say, Edinburgh? Surely you could not have one country that produces a sizeable chunk of the world’s car fleet (Germany) on an equal footing with one that produces mostly olive oil and oranges (Spain, at the time).

My tutor, when I showed him, shook his head slowly. “You will have to change your conclusions,” he told me. “I cannot possibly pass you unless you argue that full integration is not just possible, but inevitable.”

And so I went away, confused, and simply copied sections from books, even though I didn’t believe in what I was writing. My paper sailed through the marking process and was even awarded honours. I had had my first lesson in how EU integration is to be considered: inevitable.

Since that time, which was 1992, I’ve followed the workings of the EU with a half-interested eye. I was pleased when the Euro currency was introduced, simply because it made it easier to travel and because I liked the look of the notes and coins. I suspect I wasn’t the only one.

But what might on the surface have seemed like a good idea in 2002 is now quite obviously a bad idea. Everything changed after the 2007-2008 financial crisis. Up until that point, vast sums of money had been loaned to the countries of southern Europe in an effort to modernise them, thus standardising their infrastructure with northern Europe. I was living in Spain at the time and saw the relentless building programmes going on. To dare question whether it was all necessary (blasting away entire mountains to build a new motorway to nowhere? Pouring money into concrete business parks and airports that nobody needed? ) or how this money would ever be paid back was to invite ridicule. Across Greece, Portugal, Italy and France the same thing was happening: a tidal wave of credit, supplied by mainly northern European banks, covered the landscape with tarmac and concrete.  Every two bit olive and orange farmer was suddenly driving a new BMW and cities sprouted museums of modern art and Michelin restaurants like mushrooms coming up after rain You can’t stop the tide of progress, people said, it’s inevitable.

But then the financial crisis happened and everything changed overnight. When the mood switched from greed to fear, investors bailed out of the now obviously bankrupt countries they called the PIIGS (Portugal, Ireland, Italy, Greece and Spain), causing the yield on those countries’ government bonds (the interest rate on the IOU’s they sell to finance themselves) to skyrocket. Yield increases with risk, and all of a sudden it had become too risky to loan money to the PIIGS. Several years of crisis ensued, and the European Central Bank (ECB) was forced to step in and bail out the disaster zones with – yes – more loans. But they were not bailing out the actual countries, instead they were effectively bailing out the banks that had underwritten the bad loans in the first place.

But then it got even worse. Instead of making the banks take a hit for their own stupidity, austerity policies were imposed by the International Monetary Fund (IMF) and the ECB on the countries affected. Pensions and benefits were slashed, investments shelved, national assets put up for sale on eBay and democratically elected governments were removed and replaced with ‘caretaker’ administrations. Greece was hit worst of all, suffering a fall in the value of its national economy of over 30%. Many people found themselves homeless and even starving, and the suicide rate went through the roof. Youth unemployment went up over 50% - unthinkable in modern times. Whenever dissent flared up the riot police crushed it and a succession of weak governments all caved in to the demands of the so-called Troika of the IMF, the ECB and the EU.

The message was clear: don’t mess with the EU.

And the problem hasn’t gone away, even if the media doesn’t report on it much any more. Debt all across the EU is growing, and the ability of anyone to pay it back is diminishing. But why don’t the ECB just force the banks to write off their debts and be done with it? The answer to that is simple: because it will force them into insolvency. If major banks start going bust in Europe then people – lots of people – will lose their life savings, there will be an epic recession and chaos will hit the European heartland. This is not a particularly popular idea for national policymakers and yet it underlines just how fragile the entire edifice has become. And so the countries of southern Europe are left to rot in what is possibly the biggest economic crime of the century.

Greece could have been set free. If it were allowed to leave the euro it could bring back the drachma at a much lower rate of exchange. Greek imports would surge (including tourism) and the economy would be on the road to being rebalanced. But this, under the EU, is not allowed to happen. The EU cannot let Greece leave the euro because if you let Greece do it then you also open the door to Spain, Italy, France and Portugal doing the same thing. The euro currency would not survive such a mass defection, and so Greece is held bent over in a neck lock, unable to move or breathe, while its assets are plundered (if you’ll forgive the expression).

Ah, but people might say, this is all a temporary phenomenon. When growth picks up again all the boats in the harbour will rise with it. The Greeks will get down off their window ledges, move back in from the countryside where they have been scratching a living on that dusty bit of land belonging to their ‘backward’ grandparents, and collectively crack open a bottle of Ouzo to toast the end of the nightmare. The good times will roll again.

Except this isn’t possible.

Mathematicians and bankers know all about compound interest and the exponential function. Put basically, the amount of debt that countries across the developed world have now built up is unpayable Yes, even with Chinese style double digit GDP growth, there would be no way to pay back all the public, private and company debt that has built up.  And in case you hadn’t noticed there is not actually any economic growth at all in the Eurozone.

[“He’s fibbing. I read in the FT that Spain and Greece are picking up.”]

Okay, okay, so there might be a tiddly little bit, but most of it is massaged into existence (remember, I worked in the economic forecasting department of the Treasury, right?). If anyone truly believed there is economic growth in the Eurozone I would ask them to tell me what the current rate of interest is.  I’ll give you a clue: it starts with Z and rhymes with Nero.

Interest rates are the lifeblood of capitalist economies. Without a positive interest rate there is no growth. And some economies (such as Denmark) are actually offering NEGATIVE interest rates. That means you can go and take out a loan for, say, a house, and the bank will actually PAY YOU more money than you borrowed. Does that sound somewhat insane or is it just me?

Anyway, without economic growth you can’t pay back debt. Debt is a gamble on future productivity. You have to have confidence that your future income will allow your debt to be repaid. This is why my Spanish neighbours, who earned no more than a couple of thousand euros a year selling olives, no longer own those shiny new BMWs. But if you’re a country and you find you can’t pay back debt … you have to take on more debt until the mystical growth genie appears again. But what happens if the growth genie refuses to appear, no matter how hard you rub the lamp?

That is exactly what is occurring right now everywhere you care to look because (DRUMROLL) our economies are overburdened with debt and the world is running out of fossil fuels. And in terms of energy availability, there is no substitute for fossil fuels – at least not anything that would leave our overdeveloped countries in any shape or form that we would recognise as ‘modern’. I know this goes contrary to everything you’ve read and seen on Facebook, but really, it’s true.

[“You see, I told you he was crazy!”]

There is no modern economy in the world that does not rely on a steady supply of cheap fossilised sunlight in the form of oil, coal and gas to power itself.  It powers everything from electricity generation and transport, to growing food and making iPhones. Now, this is a big subject that I’ve been writing about for years and – frankly – I could go on and on about it but I’ll save the arguments for another day and merely say that when the price of oil is too high it causes recessions, and when it’s too low it causes oil companies to go out of business. The fabled ‘Goldilocks zone’ in between these two extremes equates with the time period in which we built up all of the energy-guzzling infrastructure so central to the functioning of the modern world in its current configuration. It’s theoretically possible to build millions of wind turbines and solar panels (using fossil fuels) but nobody seems interested in doing so in the timeframe that matters.

[“I don’t believe him. I saw in Good News magazine that Denmark makes 140% of its own electricity using wind. He must have an ulterior motive that he’s not revealing.”]

Sorry, no ulterior motives, just a long hard reading of a lot of material and a dose of intuition.

Thus the EU has got itself into a terrible bind, not unlike a Mexican standoff. It can’t grow its way out of trouble and neither can it allow the weaker elements to break away – it must continue to preserve the power at the centre at all costs because the power at the centre (in this case the German economy) is the growth engine that is keeping the whole thing ticking over.

So, to summarize so far, taking things from the top:

-       A dwindling of the availability of highly concentrated energy, coupled with an overburden of compounding debt, has put the brake on EU economic expansion
-       The weaker countries, which are more heavily mired in unpayable debt, are being systematically asset stripped and their citizens economically brutalised by bodies such as the ECB, the EU and the IMF (there’s a term for this – it’s called ‘disaster capitalism’)
-       The system is stuck in a closed loop, waiting for growth that never comes
-       The longer it is stuck in the loop, the greater the suffering of the people whose lives have been put on hold

How does the EU propose to break out of this closed loop? Well, ex-Goldman Sachs banker Mario Draghi, who is head of the ECB, has vowed to do “Whatever it takes” to get out of it. To that end he has used the ECB’s money (which is really the banks’ money, which really only exists on spreadsheets and gets endlessly recycled round and round) to buy national and company bonds and bail out distressed funds. He has embarked on an asset purchase programme, spending €1.1 trillion in quantitative easing measures. Let me put that in English: Mario Draghi is spending €1.1 trillion of money that he doesn’t have in order to prop up the banks which loaned money to vulnerable countries in a way that makes payday lender Wonga look like a paragon of fiscal prudence. And so the ECB, under the aegis of the supposedly accountable EU, has control over the entire money supply.

Oh, and if anything goes wrong, we’ll all be on the hook for that €1.1 trillion. But nothing could possibly go wrong …

At this point I’d like to introduce two quotes that quite possible speak for themselves:

"Give me control of a nation's money and I care not who makes its laws." — Mayer Amschel Bauer Rothschild

and

“If something cannot go on forever, it will stop.” — Herbert Stein (“Herbert Stein’s Law”)

It is perhaps worth mentioning that there are 30,000 lobbyists based in Brussels. It is these people’s (usually highly paid) jobs to spend day and night courting EU law/rule makers, treating them to champagne breakfasts and showering them with expensively produced reports that prove beyond a shadow of a doubt the interests of the European people align 100% with an increased quarterly profit result for their corporation.

[“Okay, now he’s starting to sound like a conspiracy theorist. I’m off to read The Guardian, or some other place where I can get my daily fill of confirmation bias!”]

Do you want the laws of your country to be decided by corporations rather than people elected to represent you? What’s that at the back? You don’t care because that’s the way the world works in the 21st century so we may as well accept it? That our own politicians are just as corrupt so we may as well go with the ones who are culturally dissimilar to our own crooks?

Well, if that’s your attitude then we may as well all go home now.

But assuming you do care it’s not hard to recognise the pressure that’s on Eurocrats to cave into the demands of the lobbyists. The EU, after all, is the largest block of first world consumers on the planet, and there’s plenty of money to be made from us. The EU and the US are currently trying to get through the Transatlantic Trade and Investment Partnership (TTIP), which is a grand-sounding name for a corporate wheeze. Information on what it actually contains is hard to get as it has been negotiated in secret and even Euro MPs are forbidden from memorising it and telling anyone what it might contain. If this isn’t the biggest corporate stitch up in the history of the human race then I don’t know what is.

Okay, so far I have painted the EU as an undemocratic supra-national body whose initial early promise has evolved into a Frankenstein’s monster that crushes weak countries under its heel and acts as a conduit for corporate power. Let’s turn to immigration.

[“Ha – this is the bit where he reveals his true colours!”]

Immigration and open borders are good, right? People moving round in search of a better place to live where they can earn more money?

Umm, it’s not that simple. Who knows,  maybe one day we will all truly be of one nation, one language, one religion etc. – but right now there are differences between one set of people from one country and another set from somewhere else. Generally speaking, people who have lived on a particular patch of planet Earth for hundreds or thousands of years have tended to develop their own language, cultural norms, dress code and all the rest of it. For right or wrong they tend to think of this patch of land as ‘theirs’ and they’re proud of it. When someone turns up from some noticeably different culture they generally welcome him and make him feel at home. It’s human nature to do so. Even when he goes away and comes back with his entire family, a bunch of friends and half the class he once went to school with, they still tend to get along with him and relations are good. Problems only start when the host community, who regard the area as ‘theirs’ feel they are reaching the limit of their (scarce) resources and that the settler had better not keep on inviting his friends’ friends’ friends because there will not be enough to go round. This is when problems start.

[“But, but, scarcity is a myth! If the Tories hadn’t slashed budgets across the land then we’d be able to build millions of new houses and hospitals and schools and we could go on building and building and building until everyone was happy!”]

Hmm, maybe up to a point. But how will we know when to stop? What about all the infrastructure that will need to be built? Who will pay for it? We already produce only enough food for a small minority of the population – anyway, you’re distracting me.

The problems tend to be worse if the cultures of the two different groups are quite different from one another. If the host community is a poor one – and it probably will be because the richer communities are less inclined to allow outsiders to settle there (unless they are Saudi billionaires or Russian oligarchs, in which case they are welcomed with open arms)  – their resources are likely to be scarcer. In the modern industrial societies of the west, basic resources include things like jobs, hospitals, affordable housing, schools and other public goods. The settler communities compete for these scarce public resources, making some of the hosts resentful. The wealthier people in the chattering classes, who generally don’t live in the poorer areas or have to compete for resources, then tut tut and call the poor people nasty things. Yet it is they who benefit from all the positive aspects the settler people bring (nice food, cheaper labour to do the jobs they don’t want to do themselves), without suffering any of the consequences of having to compete for scarce resources.

On the other hand, the businessfolk and politicians simply can’t get enough settlers. Not only do they work for peanuts on zero hours contracts but they effectively stop anyone else from getting a pay rise. It’s a wet dream of businessmen to achieve the holy grail of infinite labour substitutability. This means they can hire and fire people at a moment’s notice, pay them next to nothing (the government picks up the tab for the low wages in the form of tax credits) and generally treat them as if they were robots while they wait for the actual robots to come along. Likewise, the government loves settlers because they boost the country’s GDP as they open bank accounts, indebt themselves and buy consumer products. Lastly, the middle classes love settlers (as long as they don’t move in next door) as they create an additional pressure on the scarce resource of housing, boosting property prices and rental income and thus allowing them to earn money without working for it.

This might explain why it’s those at the bottom of the pile, forced to compete for the basics, who tend to have the biggest beef about squeezing ever more people in. That’s not a theory, it’s a reflection of reality that the insulated middle classes refuse to acknowledge – any ‘man on the street’ will be able to explain it in similar terms.

[“There, I told you he was a fucking racist! I’m out of here.”]

So giving everyone the right to be anywhere in the trading bloc we call the EU might sound like a fine and dandy idea, but during times of economic contraction it is the poorest who suffer the most: both the uprooted, who have to leave their families and homes behind, and the host peoples from the more disadvantaged classes who have to accommodate the settlers and share their scarce resources.

Lastly, I’d suggest that the very notion of the EU is insane. Here’s a confession: in the last election I voted for the Green Party.

[“Oh yegads! A bona fide nutcase! I told you so … “]

No, I’m not a shallow Green like the leader of the Green Party who is allied with David Cameron on Europe and was last week seen on TV with him driving around in a car talking about growth. Being a proper Green means that I’m neither left wing nor right wing. I care for the ‘magical’ hidden hand of market capitalism just as little as I care for the writings of Karl Marx. To me both are indicative of a 19th century attitude towards the way we treat our planet that is equally suicidal. In case you hadn’t read the news lately you might have missed several important pieces of information that are several orders of magnitude more important than both the EU referendum and the new Top Gear series PUT TOGETHER! I speak, of course, about the rapid acceleration of global warming, the massive forest fires rampaging across the globe, the great dieoff of the coral reefs and the diminution of Arctic ice so early in the year.

Let’s face it, unchecked industrialism has brought us to a point where we might not last out the century. Whatever else the EU claims to be one thing we know for sure is that it is committed to infinite economic growth on a finite planet. Think about it for a minute. All of the many problems that now confront us, the three main ones being access to energy, environmental degradation and population overshoot, are becoming more and more difficult to ignore. Most of us would rather stick our fingers in our ears and close our eyes than admit that we’ve screwed up and that there will be (are) consequences. We’ve got boatloads of refugees arriving on our doorstep fleeing drought and war – the consequences of global weirding and oil wars – and yet we pretend that we don’t have any responsibility to them. Quite the opposite, in fact. People, more and more,

Just. Want. Someone. To. Sort. It. All. Out.

We want scientists to come up ever more outlandish (and costly) ways of staving off collapse, be it genetically modified foods, ill-thought-out geoengineering projects to further mess with the climate or – as a last resort – a space rocket to get us to some other planet we haven’t yet wrecked.

This trend towards putting our faith in the hands of ever-greater powers doesn’t say much for the state of the human spirit I’m afraid to say. It seems to me an abnegation of our responsibilities to insist that someone else deals with our problems, but that’s exactly the attitude I see with supporters of the EU project. They may well talk about this or that EU project saving a wetland or rescuing a dormouse, but they don’t talk about the wholesale pillaging of the planet that the EU promotes and amplifies. I don’t believe that the solutions to our many problems will come from some Wizard of Oz type character sitting in Brussels and pulling levers. There won’t be a one-size-fits all solution to our continued shared existence, so why choose to disempower ourselves more than we already have? By getting ourselves out of it we’ll be restoring the balance of power some way in our own favour.

So next week we have the chance to throw a spanner in the works of the inevitable onward march of the EU machine. Both options will be painful and there will be plenty of hurt, but that is the corner into which we have painted ourselves. There will be unintended consequences - that is the nature of things. Here are two possible scenarios out of millions – it’s up to us to choose which one we want to bring into reality.

Remain Wins

The EU gets a vote of confidence from the UK and – emboldened – proceeds with plans for a federal one-nation Europe with much more robust and invasive policy making powers. Some kind of ‘trade’ deal is reached with the US which allows corporations to sue public bodies for lost profits, but otherwise life remains pretty much as normal in Britain – except for some noisy street protests and the huge boost for UKIP. All the while the debt continues to build up and ever more stringent austerity measures are imposed on member states. In Europe a bank or two collapses, causing others to soon follow suit. Widespread banking failures throughout the financial system ensue and the unpopular ‘bail in’ measures are enacted which see savings confiscated to prop up the remaining banks. Over the next couple of years depression-era scenes and radical violence become commonplace in once wealthy countries. Various extremist parties are voted into power on a wave of frustrated anger and the assassinations of bankers and politicians fill the newspapers. Eventually the EU collapses under the weight of its own internal discord and is dismantled with extreme prejudice by nation states. Years of dysfunction ensue but from the embers of chaos begins a new project to build a truly united Europe based on mutual respect for one another, ecological limits and social democracy, as opposed to the free market capitalism, corporatism and exploitation of the old project.

Leave Wins

The media are all aflutter with predictions of apocalypse, but most people are too busy having street parties to notice – as are many across the whole of southern Europe. The pound gets a sharp correction lower, and the price of gold skyrockets. The EU reacts furiously towards Britain but is powerless to retaliate for fear of damaging the German and French economies. Britain’s admittedly unpopular new prime minister sends trade delegations to the four corners of the world to strike trade deals with countries including Russia and China, much to America’s ire. Economic chaos reigns for a few months but people are at least happy they don’t have it as bad as they do on mainland Europe where Brexit has caused the equity markets and banking system to crash. Several other nations immediately hold their own referendums (Denmark, Holland, France and Poland) and the buzzword on everyone’s lips is ‘contagion’. The new UK government misinterprets its popularity and tries to force through some unpopular policies – including fracking in national parks – but the newly-emboldened Britons won’t stand for it, forcing a general election and electing a party on a platform of national unity. Despite a lot of bluster and bad will the EU is dismantled more or less peacefully as countries are once more allowed to follow their own monetary policy and set their own rules for trade. Nevertheless a few years of chaos and recession follow as a new system configures itself. From these shaky beginnings is begun a new project to build a truly united Europe based on mutual respect for one another, ecological limits and social democracy, as opposed to free market capitalism, corporatism and exploitation.

***

Okay, after that short diversion in the national debate we can now return to arguing about how much money the EU costs Britain and whether they will force us to eat straight bananas.


Open the box and let them out again.

Monday, February 22, 2016

Danger: EU Demolition in Progress



It’s getting harder all the time to distract oneself from how threadbare the fabric of our societies is becoming. No matter how much you avert your eyes it is all but impossible not to notice things unravelling around you. This is happening on every level, from the local to the international, manifesting itself in a multitude of ways.  Just as a fractal pattern has both the macrocosm in the microcosm, and the microcosm in the macrocosm, we are seeing signs of collapse small and large all around us.

At the micro level I could mention the town in which I live. In the past year we’ve seen a couple of big box retailers close down at one end of the scale, and quite a few small independents as well, some of which have been trading for decades. Streets have so many boarded up shop-fronts that the local council has taken to plastering them with posters showing images from happier times. Homelessness has spiked too, as has drug and alcohol abuse. The police station hasn’t officially closed down, but try getting hold of an officer when you need one – as I did when some drunken youth vandalised my car. The building is still there but instead of it being open there is a phone beside the front door that you must use to report a crime.

Aside from the police and the shops closing, public toilets are closed virtually all of the time, and the Post Office too is soon to close down, having been privatised and now asset stripped. The council is being forced to raise its taxation rates by 4% this year to cover the shortfall caused by spiralling costs and diminished funding from central government. Clinics and charities are being squeezed out of existence and the local council tried (and failed) to privatise the town’s midsummer festival.

My wife works in the care sector. The stories I get to hear will make you never want to be dependent on the state in your old age. If you can’t rely on your kids to look after you in your dotage it might be wise to keep a bottle of whisky and a revolver in your bottom drawer. Or maybe you'd rather die of thirst lying in your own mess because the 19-year-old unqualified carer who works for minimum wage is too busy checking Facebook on her phone to hear you pressing the emergency button by the bed.

Food banks are popping up. Schools are cancelling the more costly trips due to a lack of pupils being able to afford them, and local councils are cutting down trees in public places as they are ‘costly to maintain'. Streets are lined with weeds.  

This might sound like a laundry list of woes, but despite it all there is still a reasonably solid façade of normality. Potholes in the road get fixed, people are still buying shiny new cars and householders do up their homes. The county council is still pressing ahead with its plans to install super-fast broadband that will ‘connect us to the world’ as if we weren’t already, and the newspapers continue to repeat that the economy is recovering, that everyone who wants a job now has one, and that generally speaking things are pretty good and getting better all the time. Children’s TV programmes are still talking about us all going off to live on Mars at some point in the future, Richard Branson has unveiled a new spaceship and true believers are still talking earnestly about self-driving robot cars that are fuelled by water.

All well and good if you are not paying attention, but on another level it is also getting harder to ignore the cracks that are appearing around us. And crack-ups don’t get much larger than the EU. The UK prime minister David Cameron recently announced there would be a referendum on whether Britain should remain a part of the EU aka ‘Brexit’. This has had the effect of a starting gun being fired in the race to win votes for the respective ‘In’ and ‘Out’ campaigns. If the ‘ins’ win then the UK will remain within the EU, albeit still on the periphery and with various half-measures in place to ward off unwelcome EU policies. If the ‘outs’ win then the UK will be out of Europe and millions of lawyers can expect to look forward to years of lucrative work as we try to disentangle ourselves from the biggest bureaucratic mess the world will have ever seen.

Even though it is early days, a basic and simplistic narrative has emerged in the debate. It goes something like this:

From the INs: “The EU brings us peace and prosperity. It has eliminated borders, improved the environment and lifted consumer standards. We would be X b/million (insert random number from your favoured think tank) pounds worse off if we left. It protects us from Russia and ISIS and the Brexiters are nothing but a bunch of right-wing racist Neanderthals who want to steal the EU’s (benign) power and use it against us.”

From the OUTs: “The EU is undemocratic and nobody should have the right to decide our national policies – especially immigration. It is run by unelected technocrats who are paid a fortune to make up silly laws. The European Court of Human Rights is the go-to place for Islamic terrorists and paedophiles who should be tried (and hopefully hung) in Britain.”

That might be a bit simplistic, but that’s the kind of level of debate that is going around at the moment. Everybody is talking about whether the EU is a good thing or not to be part of, but nobody is asking whether it can exist at all for much longer. I would argue that it cannot. The EU, at heart, is a vast trading bloc of half a billion people. Its very existence is predicated on capitalism, acquisitive expansion and favourable trade deals at the expense of the third world. It runs on cheap energy – the kind of energy that will not be readily available for much longer, and when the inevitably huge financial unwind picks up pace it will severely curtail European access to capital markets and energy. The EU might be rich but it is only rich because of historically unfair trading conditions that have impoverished half the world. And it has very few viable energy sources that would keep it in the manner to which it is accustomed.

The EU has always contained the seeds of its own destruction. By regarding monetary union as an inevitability (an inevitability that has steamrollered democracy in the process) it would logically reach a point where the weaker member states would not be able to keep pace with the stronger ones. By flooding the southern periphery nations with cash – and then asking for it back with interest – the EU looks from the outside to be a self-cannibalising monster. Peace in Europe? Let’s see how long that lasts. There are many in Greece, Spain and Portugal who see ‘the EU’ as Germany in disguise.

Pro-EU liberals tend to regard the continent in terms of what consumer benefits they can extract from it. To be ‘pro Europe’ is to retain one’s right to fly to Barcelona for the weekend on Easyjet and enjoy tapas on Las Ramblas. They warn that this kind of easy living won’t be possible if we leave the EU.


If the EU were to quit the EU it probably wouldn’t be a death blow. A far bigger existential threat to the EU comes in the form of the refugee crisis So far, only a relatively small number of refugees have arrived in Europe and yet people are already whipped into a frenzy of fear and anguish. In 2015 around a million beaten-down desperate people fled war, drought and economic collapse, to arrive on the shores of Europe – many of them drowning along the way. A million sounds like a lot of people until you remember that there are already half a billion people living here in an area of 1.7 million square miles. If the refugees were spread out equally they would have nearly two square miles each. Lebanon, by contrast, has some two million refugees – and Lebanon is a country you could lose under a crumb on a world map. A Belgian minster's response to the EU's refugee ‘crisis’; tell Greeks to push them back into the sea. There’s your liberal EU for you.


This is also the same organisation that is trying frantically to get a secret trade deal ratified that would hand over yet more power to trans national corporations and take it away from nation states. If TTIP goes through we can kiss goodbye to basic rights and freedoms, such as being able to choose whether our kids eat genetically modified food or can be told that smoking is bad for them.

By now you’re probably thinking that I’ll be ticking the ‘Out’ box on my voting slip on June 23rd. I will be, but its more or less irrelevant as the EU cannot last much longer anyway. This point of view, alas, will not go down well with many people. To be a ‘Brexiter’ is conflated with being a pig-headed xenophobe who refuses to regard social justice issues as the most important battle in human history. The ‘debate’ is far too tribal in any case. The arguments of the ‘Ins’ are confusing and make no sense to me. They talk about democracy yet want to give it away, and they celebrate diversity but at the same time think a ‘one size fits all’ mindset will deliver that.

The irony of being called anti-European is that I am ardently pro-European. I’ve lived in four different EU countries, travelled all over and am married to an Italian Dane. Europe, to me, is the most diverse place in the world and has an amazing spread of history and culture. My ideal life would involve spending several months each year travelling around Europe in a camper van and getting to know it in an even more intimate manner. The EU is not Europe; it’s an abstract concept masking a faceless undemocratic organisation that funnels wealth from one place to another and keeps its modesty intact behind a fig leaf of supposed liberalism.

It doesn’t have to be that way. We could still have a Europe united around some core values other than money and power and capitalism. How about a Europe focused on an emerging eco consciousness? Or what about remaking it as a loose cooperative of bio-regions? Or perhaps, at the very least, we could all agree on a shared constitution founded on liberty, equality and fraternity. Former Greek finance minister Yanis Varoufakis has suggested something along those lines, setting up a pan-European umbrella group called DiEM25 that aims to shake things up ‘gently, compassionately but firmly.’ Perhaps there could be more debate about what kind of Europe would be better suited to weathering the coming financial, ecological and energy shocks without causing so much collateral damage to both itself and other nations.

Until that happens we’ll just have to stand back and watch the fireworks. Big institutions like the EU are like skyscrapers; they don’t come crashing down to the ground without taking out plenty of other nearby buildings and the EU is like the leaning tower of Pisa on steroids.  Big things are an artefact of the age of oil – the future is necessarily smaller and more local. The best course of action is to stop arguing over whether it is best to be stood on top of the creaking tower it or beside it, and simply get the hell out of the way before it goes over.