Friday, September 16, 2016

Pontevedra Pensées: 16.9.16

A bumper post . . . .


Ethics: Trust: A huge Spanish company, teetering on the verge of bankruptcy last year, raised a huge sum of money in Mexico just days before the plug was pulled and immediately transferred all the cash to Madrid. All legal, of course. But moral? Mexican investors are not at all happy, as you might expect. But appear to be powerless. See Don Quijones on this tawdry tale here.

Safety. Risk: In the context of reports about the recent fatal train derailment near Pontevedra, an official is reported to have stressed that 90% of railtrack points in Spain work well. Bloody 'ell . . . In case you missed it, that means an awful lot don't.

Driving in Spain: I read an article yesterday in which the roundabout advice was different from that of the Guardia Civil I recently posted. Is it any wonder there's total confusion here about which lane to be in when there's more than one? Anyway, I decided on Monday last to note the percentage of roundabouts on which drivers on my right cut across me – “illegally” - because they've stayed in the outside lane even though they're not turning right or going straight on. Having been taught to do this to pass their driving test. Within 2 seconds I'd clocked the first instance. As of now, it's about 80% but I'll continue the exercise for a while.

Taxation; Thanks to several vicious and short-sighted measures which hit foreigners even more than Spaniards, Spain is now said to be one of the most heavily taxed countries in the world. And a dangerous one to live in if you have assets outside Spain. Believe me, they are a hostage to fortune. Literally. Sometimes one wonder is anyone in Spain looks beyond tomorrow.


Health: Inspired by the news that 69 year old Trump has a BP of only 126/70, I checked mine and was pleased to find it was OK. But can Trump really have such a startlingly good level at his age without medication? Is this why his medical report is so thin?

British TV: I've stumbled on an FTA channel that appeals to my love of history - Yesterday. Naturally, it doesn't look much to the future. Except for the irony that most of the ads target the snow-tops who favour the channel and who are endlessly encouraged to think about their funerals.

Which reminds me . . .

Another Daft AdvertIsing Claim: From the Coop Funeral Care – We're here for you when you need us most. Like when your'e dead and gone, for example.

Finally . . . Words: Here are the 18th century meanings of these:-
Economist: Someone careful with money
Auditor – Listener
Plaudit – Applause

Cue argument from that crashing bore, Alfie Mittington.


I had visitors from Finland this summer and they kindly left me a book of cartoons depicting “Finnish Nightmares”. The astonishing thing about these is that they are all identical to British/English nightmares. I'll be posting them all. Here's the first two. Sorry about the American spelling . . . :-


The Status Quo: Nothing to report beyond continued stalemate. Daft.


It's reported that the Merchant Banker Juncker and his colleagues are planning to follow up the appointment of 2 anglophobes as his chief Brexit negotiators by making the negotiations so tough that the UK will beg to stay in the EU. If this is true, it's another woeful failure to understand Brits and the consequences of hundreds of years of democracy. Anyway, here's an article which addresses severe EU failings and puts forward a collaboration option that might just work – splitting poltical and commercial aspirations. Let's hope so. And let's leave the political dreamers with a reduced federal superstate where the people don't really count because Daddy knows best. 

For those really interested, here are 3 articles from The Times.

Juncker is fiddling while EU economy burns

Saint-Georges-de-Mons is one of those French towns you barely notice on your way to the more scenic parts of the Auvergne. There is a small church, a few bars, an unappetising restaurant and a brutalist town hall.

The only interesting thing about it is a nearby building site — not because of what is being built there (a factory to recycle aviation-grade titanium) but because of who is paying for it. For the EcoTitanium plant is one of the only visible signs of the project which was supposed to save Europe.

Last year, shortly after taking charge of the European Commission, Jean-Claude Juncker trumpeted an unprecedented £268 billion investment programme to kick-start the EU economy. The Juncker plan made all the right noises: Europe needs more investment in infrastructure, more shared spending and more economic growth. But as with all infrastructure splurges (Philip Hammond take note) those big promises have proved difficult to deliver.

The whole point was to go beyond Europe’s existing infrastructure plans but the vast majority of the projects are small schemes that qualified mainly because they were too boring to feature in European finance ministers’ own budget speeches. So there are obscure road widening projects near Stuttgart, home insulation schemes in France and a proposal to roll out smart electricity meters in the UK.

Indeed, according to the Bruegel think tank, of the 55 projects approved by the EC, only EcoTitanium would have struggled to get funding from existing investors such as the European Investment Bank. In other words, the great legacy of the Juncker plan might be a factory you’ve never heard of doing a job you’ve never heard of in a town you’ve never heard of.

Still, while other cultures would see this as evidence of failure, that’s not the European way. So today, Mr Juncker will propose an extension of his scheme at the EU summit in Bratislava. It is worth dwelling on this for a moment, because the failings of the Juncker plan are a useful shorthand for the deeper economic malaise affecting Europe.

After all, on the surface, things seemed to have improved across the Channel. For a brief period before the Brexit vote, growth in the euro area exceeded that of the UK. Most economists were forecasting decent growth this year and next, thanks to the European Central Bank’s quantitative easing programme, and to the fact that Germany has pledged to spend a bit more on investment. Berlin even hinted that it might help Greece by writing off some of its debt.

But a closer look reveals the cracks. For one thing, economic growth has started to peter out. Economists now expect the euro area to grow at a slower rate than the UK this year. The same is true of the Continent’s supposed engine room, Germany, where recent surveys of industrial activity suggest the economy is flatlining.

One explanation is that for all his promises — to the IMF, to the G7 and to every other international body — that he would spend more on investment, the German finance minister Wolfgang Schäuble has reverted to type. His obsession has always been what Germans call the “schwarze null” — getting a big “black zero” on the fiscal balance sheet. Mr Schäuble has actually gone further, posting a comfortable surplus in the first half of the year.

While a fiscal surplus would be good news for most countries, for Germany it is damaging. Weak government spending means weaker growth, not just at home but throughout the eurozone, which depends on its leading economy to lift everyone else. It also prevents the kind of rebalancing needed to allow Greece and its fellow Mediterranean economies to survive within the single currency.

Already there are some worrying echoes of the euro crisis: the ECB’s so-called Target2 accounts which measure how reliant the troubled southern economies are on the north show imbalances are rising again, in Italy’s case to the highest level on record. Inflation is still barely in positive territory. Investment spending across the continent is now actually lower than when the Juncker plan was launched. In short, Europe is deeply vulnerable.

Most worryingly, this time around, Mario Draghi, the central bank president who in 2012 promised to do “whatever it takes” to safeguard the euro, seems to be running out of ammunition. The ECB’s massive programme of quantitative easing [i.e. hosing free cash around] is struggling to find new eligible bonds to buy. The question of whether it will continue beyond next March was not even discussed at the bank’s policy meeting last week.

All this before one considers the two main issues under discussion at today’s summit: Brexit and the refugee crisis. Leaders arriving in Bratislava have been given a dossier by the commission showing that immigration and terrorism are now the biggest concern for EU citizens.

The optimistic take is that these two crises finally force the leaders to resolve their problems, to create a true monetary and fiscal union for the euro and an arm’s-length outer doughnut with migration controls that even tempt Britain. Moreover, while he seems deaf to economic reason and the struggling economies of the Mediterranean, the German elections next year may at last force Mr Schäuble to loosen his purse strings.

Then again, Europe’s history of doing the wrong thing and then doing it all over again suggests the road ahead might be even bumpier.

The Eu an interregnum

Merkel must solve Europe’s identity crisis

Brexit is turning into the political equivalent of Schrödinger’s cat. As long as the government refuses to invoke Article 50 and open the box, Brexit will resemble the moggie in the famous paradox, both alive and dead. That strange limbo encourages silliness among British politicians — Liam Fox leads the field with his rant against unpatriotic golfers — but also a wilful blindness about what is going on in Europe.

The fact is that we are fast becoming yesterday’s problem. There is no queue to leave the EU — one Eurosceptical minister at a Polish mountainside retreat last week described Brexit to me as the Great Leap Backwards — and no sense of urgency about accommodating Britain’s new needs.

We may flatter ourselves that the upcoming Bratislava summit of the rather large rump of the EU, the 28 Minus One, will be all about the British question. Seen from Europe, that question was answered on June 23 and the chief anxiety is about the likely return of the migrant exodus; how to deal not only with the numbers but with issues of identity, of the rights of national parliaments to resist centralised control by the European Commission. The task of finding solutions to the multiple crises on the continent is being left, as ever, to Angela Merkel at the most wobbly moment in her career.

Under the force of mass migration, Europe seems to be splintering into three blocs. First there are the northern states — the Nordics, the Baltics, and the Netherlands — which still abide by the good housekeeping rules set by Germany. Then there are the southern Club Med states that want to bend those rules and demand more solidarity on illegal migration from the north. And there’s the awkward squad in central Europe, who feel let down by what they see as a bullying Commission and are beginning to challenge some of the founding principles of the EU.

These power hubs are fluid. An enfeebled French government sometimes seems to be a more natural member of the Club Med. The Dutch and the Danes could find themselves aligned with central Europeans in showdowns with Brussels. Poland and Hungary, though seemingly the new leadership tandem in the east, are at odds over how to deal with Vladimir Putin.

Merkel’s way of threading together a modern problem-solving Europe, a post-Brexit pragmatism, is to identify and encourage a favourite among the southern leaders. Matteo Renzi, the Italian prime minister, is her man. “We do not bring extravagant requests for help or concessions,” Renzi said, drawing applause from the German leader. “We are offering something to Europe to help it return to being a community, rather than reducing itself day after day to a mere contract.” In that spirit, the post-Brexit EU states will meet in Rome next spring to renew their vows.

Merkel likes that — her grudge against Britain was that its relationship with the EU was framed too much as a contract — and she will fight hard behind the scenes to help Renzi win a constitutional referendum later this year. “The Mediterranean now carries more weight than the Channel,” a proud Italian headline said the other day. Renzi, if he survives, will be put in the driving seat of southern Europe, dealing with the migrants and playing a lead European role in stabilising Libya.

It is, however, the central Europeans who are the coming force. Viktor Orbán, the Hungarian prime minister, sees Brexit as a golden opportunity to argue his case for a return to national and regional action rather than intrusive rule from Brussels. He is not alone in central Europe in predicting that the Turkish migration deal with the EU will fall apart. The answer, he says, is not a system of compulsory quotas for taking in migrants, but a reinforcement of the Schengen zone’s external borders. Hungary is about to build a second wall on its frontier, and works with its neighbours to plug weak spots.

The answer, Orban says, is not a system of compulsory quotas for taking in migrants, but a reinforcement of the Schengen zone’s external borders.

On October 2 Hungary will hold a referendum that will probably voice national opposition to EU-imposed quotas. That will be a launch pad for further central European demands for less Europe, more national sovereignty. According to Orbán, the European dream has moved from the west to the east, and it’s a very different one. Merkel does not much like him, but no matter: he’s a truth teller. He was right to pronounce the death of multiculturalism as a political ideology. Right, too, that migrants are heading in our direction because Europe is perceived as being rich but weak.

These are Europe’s problems and it seems that they are no longer ours. If we can think of solutions, we tell ourselves, nobody is likely to listen. Yet however EU membership may chafe at the collar, its elites are at least beginning to conduct the big debates. We are living, says the think-tanker Mark Leonard, in an interregnum, the dangerous period between the end of an old order and the establishment of a new one. Worthy postwar institutions such as the EU, UN, even Nato, are looking frayed; the very idea of globalisation, despite its many merits, is being rejected on the streets and in parliaments.

Leaving the EU was a recognition that we would never be able to reform it from within. But the next step cannot be reduced to the mechanics of getting a good exit deal. We need to start a proper conversation with ourselves about nationhood and community, about where we really stand in the world. And let’s listen more carefully to what is being said across the Channel. We’re not the only ones in the throes of an identity crisis.

Hungary ‘should be kicked out of EU’

Europe’s cultural divisions deepened yesterday after Luxembourg called for Hungary to be kicked out of the EU because of the country’s hard stance on Muslim refugees and migrants.
The row has further poisoned relations between liberal western European countries and eastern Europe three days before a crucial summit on the future of the EU after Britain’s vote to leave in June.

Jean Asselborn, Luxembourg’s foreign minister, demanded the suspension or expulsion of Hungary over its authoritarianism and anti-migrant razor wire fences on its Balkan borders.
We cannot accept that the EU’s fundamental values are being massively violated,” he told the German newspaper Die Welt.

Anyone, like Hungary, who builds fences against refugees fleeing war or breaches press freedom and the independence of the justice system should be temporarily, or if needed, for ever excluded from the EU.”

He added: “The fence that Hungary is building to keep out refugees is getting longer, higher and more dangerous. Hungary is not far away from issuing orders to open fire on refugees.”
Since taking office with a huge parliamentary majority in 2010, Viktor Orbán, Hungary’s nationalist prime minister, has repeatedly clashed with the EU over media regulation and controversial sackings of judges.

He further inflamed western European liberals last week by describing Britain’s referendum as a “fantastic opportunity” for a cultural counter-revolution to roll back the EU’s commitment to welcome refugees.

The European Commission is exercising previously unused powers to confront Poland, which has changed its constitution so that politicians can appoint judges. The “rule of law mechanism” was drawn up after concerns that Hungary undermined democratic norms when Mr Orbán was elected.
Mr Asselborn wants those powers to be used against Hungary. He will also endorse EU treaty change at the summit as a part of the debate on the future of Europe, and proposes to make it easier to suspend the voting rights of countries accused of human rights abuses.

It would be helpful if the rules would change so that the suspension of membership of an EU country in future no longer requires unanimity,” he said.

In three weeks Hungary holds a referendum on EU quotas to relocate 160,000 refugees from Greece and Italy. The measure was imposed, after German pressure, in defiance of central and eastern European opposition.

Mr Orbán has campaigned vigorously for a No vote with billboards blaming the EU for last year’s migration crisis and the terrorist attacks in Paris and Brussels that killed 162 people.
Péter Szijjártó, the Hungarian foreign minister, called Mr Asselborn “an intellectual lightweight” who “lives a sermonising, pompous and frustrated life . . . just a few kilometres from Brussels” and accused him of “working tirelessly to demolish European security”.


Alfred B. Mittington said...

Wh, pray tell, would you use punctuation thus:

Economist: Someone careful with money
Auditor – Listener
Plaudit – Applause

Would it not be more… consistent, say, to use either the colon or the hyphen to connect the word with its explanation?


Colin Davies said...

WTF cares? You have a genius for trivia. Not to mention severe anally retentive traits. Which explains the former.

Alfred B. Mittington said...

You did ask for it, remember???


Colin Davies said...

It was a prediction not a request