Thoughts from Galicia: 30.4.17

Spanish life is not always likeable but it is compellingly loveable.

- Christopher Howse: A Pilgrim in Spain.

Life in Spain:

• Here's a report on the annual April fun down in Sevilla. Too late for you to catch it now.
• And, if you live in Madrid, here's The Local's list of the 10 best day trips out of the city. I'd add Pastrana, though I've yet to go there.
• The percentage of smokers in Spain is reported to have plummeted to, I think, 29% - against an EU percentage of 24% and a UK number of 19%. While agreeing that things have improved – especially indoors – I wonder whether this is really true. At least among young women. Ten of these sought a table in my regular bar last night and were persuaded to have a drink and wait a while. Having got their drinks, 5 of them promptly went outside to smoke. And this seems to me to be a pretty accurate picture of things in this group at least.

I mentioned yesterday the damage done by frost to the vines up near Monterrei in the Galician mountains. Here's a more positive comment on the wines from that region.

The worst fears of knowledgable Brexiteers such as Richard 'Flexit' North and Christopher Booker appear to be materialising, thanks to the (at least apparent) incompetence of the British government. See the first article from the latter at the end of this post. In these circumstances, it must surely be right to give the British electorate a chance to vote on the final deal. If, indeed, there ever is one.

Still on the subject of negotiating Brexit, see - after the Booker article - an interesting interview with Europe's enfant terrible - Yanis Varoufakis - on Mrs Thatcher's challenge. As for pro-Brexiteers, they might like to ponder on Ambrose Evans-Pritchard's last line: Any Briton reading his damning account with an open mind might conclude that British democracy is best kept at a very safe distance from an EU that has so badly lost its way. Which, to my mind, is rather more important than, say, your kid having rights to an EU bursary.

Finally . . . I said yesterday that my catching a chill had reminded me of reports of folk dying in earlier centuries of doing the same. Right on cue, I read these 2 sentences last night in the book – A Stranger in Spain – I cited yesterday:-

• [After attending a rehearsal of his own Requiem Mass] Charles I retired thoughtfully to his little garden, where he caught a chill that developed into a fatal fever.
• It was while engaged on such palace decoration work that Velázquez caught a fever which proved fateful.

Today's cartoon:-

Apology: I failed yesterday to either upload Jack's video of leghón musicians and dancers or find a video of them on the internet.

ARTICLES

1. Our Brexit illusions are about to be shattered   Christopher Booker

For months I have been predicting here that, sooner or later, the day would come when some very uncomfortable realities would start to intrude on the bubble of make-believe in which our  Government has been heading with our negotiations to withdraw from the EU. Last Wednesday, before the EU’s leaders gathered this weekend to proclaim their united response to Britain’s demands, the loudest alarm bell yet was sounded by Angela Merkel in a speech to the German parliament.

The British, she said, have simply been “wasting time” living in a cloud of “illusions”. For a start, she made clear, they cannot hope to begin discussing trade before they agree to meet that so-called “divorce bill”. This, she said, is “irreversible”. As I was pointing out last summer, it was always going to be top of the EU’s agenda that we must pay our share in all those ongoing financial commitments up to 2020 and beyond which our government has already legally signed up to.

Mrs Merkel then won cheers from the Bundestag by reminding them that, by deciding to leave the single market and the European Economic Area (EEA), Britain is choosing to become automatically what the EU classifies as a “third country”. This means we cannot possibly hope to enjoy anything like the ease of trading with the EU that we have now.

As again some of us have long been warning, this means we are choosing to exclude ourselves from the system which gives us unrestricted access to easily our largest export market, and the source of 30 per cent of our food. Up will go border controls on all our frontiers with the EU (including that in Northern Ireland). The days when 12,000 trucks a day could cross freely from Dover to Calais, and much else, will be over.

There is no way that any one-off “trade deal” of the kind Theresa May and her colleagues are imagining could get round any of this, and the practical implications of this for Britain are horrendous. That is precisely why some of us have long tried to point out that the only conceivably sensible way for us to leave the EU, wholly desirable though that is, would be to have remained in the EEA and to join Norway in the European Free Trade Area (Efta).

It is terrifying how deliberately our politicians, led by the “Ultra-Brexiteers” around Theresa May, have refused to consider what this could have given us: continued trading as we have now; exemption from most of the rulings of the European Court of Justice; freedom to negotiate our own trade deals with the outside world; even a unilateral right under the EEA agreement to exercise, in our national interest, some selective control over immigration from the EU.

But all this, by failing to do the necessary homework, the Ultra-Brexiteers have shut their eyes to. They have not begun to grasp the realities of what would be needed to achieve a properly workable disengagement from that system of government we have been part of and ruled by for 44 years.

They will shortly be brought up against all those hard realities to which they have remained oblivious, in ways far more unpleasant than they can yet imagine. That is what Sir Ivan Rogers was hinting at when he spoke of “ill-informed and muddled thinking” at the top of government, before he resigned last December as our top man in Brussels. And it is what Mrs Merkel means when she says that British ministers have so far just been wasting time in chasing “illusions”.

But how many of our own politicians over the next few weeks of election campaigning will be pointing any of this out; any more than we will hear it from the BBC and the rest of the media? For reasons long predictable, we are heading for some very nasty shocks and real trouble. The Brexit dream stage is over. Merkel’s chilling words last week were only the start of the new phase we are now so blindly drifting into.

2. Yanis Varoufakis: 'My Brexit advice to Theresa May is to avoid negotiating at all costs'

Yanis Varoufakis, who dared to oppose the might of the EU, tells Ambrose Evans-Pritchard Britain must learn from Greece’s plight.

Theresa May might balk at taking advice from a radical Greek Leftist and motorcycling heart-throb of the European protest movement, but nobody knows better than Yanis Varoufakis what it means to take on the EU power structure.

The former finance minister of Greece bears the scars of battle. For five hair-raising months he waged guerrilla warfare against the debt-collection policies of the EU-IMF Troika, learning to judge the reflexes of an imperial apparatus where the locus of real influence is disguised and where there are, in the words of the European Commission chief, instruments of torture in the basement.

The Greek Spring was short, snuffed out in July 2015 when the European Central Bank cut off liquidity and forced the closure of the banks.

Prof Varoufakis wanted to retaliate by issuing a “parallel liquidity” and defaulting on ECB bonds. But with ATMs in Athens limited to withdrawals of €40 a day and running out of cash, premier Alexis Tsipras and his Syriza party bowed to crushing pressure. They agreed to Carthaginian terms. Their spirit was broken.

There are lessons for Brexit in this sad saga. Prof Varoufakis, a specialist on economic “Game Theory”, says Britain must not let itself be captured by the EU’s negotiating net. If the UK succumbs to that fate, it will be beaten down by one humiliating defeat after another in a slow campaign of attrition. The EU will exploit Britain’s political divisions, playing off regions and parties against each other.

“My advice to Theresa May is to avoid negotiation at all costs. If she doesn’t do that she will fall into the trap of Alexis Tsipras, and it will end in capitulation,” he told The Telegraph.

He was speaking on the publication of his memoir, Adults in the Room, a riveting account of his brush with a back-stabbing and treacherous EU system.

It is a regime that knowingly persisted in imposing ruinous policies on his country against economic science and logic. A benign union it is not.

“The parallel with Brexit is the tactic of stalling negotiations. They will get you on the sequencing. First there is the price of divorce to sort out before they will talk about free trade in the future,” he said.

On cue, Chancellor Angela Merkel said this week that alimony must be settled before any start, and called on the UK to be more “constructive”. She warned that the British are deluding themselves if they think they can have their EU cake and eat it. Those who lived through the Greek drama find the words eerily familiar.

“They will give you the EU run-around. You won’t always know exactly who to talk to and that is deliberate,” said Prof Varoufakis. “When you make a moderate proposal they will react with blank stares and look at you as if you were reciting the Swedish National Anthem. It is their way of stonewalling,” he said.

Prof Varoufakis, steeped in Hellenic mythology, says they will resort to the “Penelope Ruse”, the delaying tactic of weaving each day before unravelling it again secretly at night. “They will suddenly suspend talks claiming the need for more fact-checking,” he said. The EU counter-attack has already begun, prompted by Mrs May’s decision to call a snap election.

Brussels had assumed that the Tories would be vulnerable when Brexit talks come to a head in 2018, struggling to deal with internal brush fires on all sides. EU officials now realise it will not be so simple. The vote has thrown Brussels off its stride, and raised hackles.

“What they are trying to do is to reduce any benefit that Theresa May will get out of the election and downplay her democratic mandate,” said Prof Varoufakis. The only way to avoid being caught in the spider’s web is to seize the initiative and take away their ability to create mischief, he said. He advises filing an immediate request to join the European Economic Area for a seven-year transition.

“They could not refuse this. They wouldn’t have a leg to stand on,” he said. The EEA is the “Norwegian option” backed by Labour.

It safeguards trade and the City, and allows withdrawal from areas of EU activity. But it also breaches Mrs May’s red lines on free movement and the the European Court.

There lies the rub. What emerges from Adults in the Room is a eurozone regime where democratic accountability has broken down.

Real clout lies with a secretive “Eurogroup Working Group”, operating on the margins. It is under the iron control of Thomas Wieser, the most powerful man in Brussels. While this body ostensibly serves elected finance ministers, they might as well be wallpaper.

“For almost all the meetings at which I was present the ministers received no substantial briefing on any of the topics,” he said. Their role was to “approve and legitimise” pre-cooked decisions.

To the extent that this Praetorian Guard reports to anybody, it is to German finance minister Wolfgang Schauble, and he is brutally candid about the character of monetary union. “Elections cannot be allowed to change economic policy,” he said during a meeting on Greece. The others meekly assented. Behind the scenes, Berlin holds sway.

While Germany let the French politician Pierre Moscovici become EU finance commissioner for the sake of appearances, it stripped him of power and put him under the supervision of a Berlin factotum.

Even those countries that suffered an economic 'lost decade' from austerity overkill submit quietly to the German writ. 

Party affiliation makes no difference. The centre-Left parties shed crocodile tears over austerity but are themselves arch-enforcers for creditor interests when push comes to shove.

“Social Democracy in Europe is finished, kaput, gone. It made a Faustian bargain with finance,” Prof Varoufakis told me bitterly. “When the crisis came in 2008 they transferred the losses from the bankers to the most vulnerable people.”

Prof Varoufakis is Europe’s enfant terrible. He infuriated the EU and his own Syriza comrades. He broke diplomatic etiquette. He played the press. The establishment called him a dangerous gambler. Yet on the economics of the Greek crisis and the eurozone slump, he was right.

A chorus of Nobel Prize winners agree with him. The “fiscal water-boarding” of Greece, with its medieval policies of blood-letting, was counter-productive even on its own cruel terms. The 26% contraction of the economy was so violent that it set off a downward spiral, causing the debt ratio to rocket. The Troika bail-outs forced a bankrupt Greek state to take on more loans in a squalid policy of “extend and pretend”.

Greece needed 50% debt relief at the onset of the crisis but this was deemed too dangerous because the eurozone – due to its own negligence – had no defences against contagion.

The IMF confesses the errors in a devastating mea culpa. The IMF admits its own “superficial and mechanistic” analysis. It was bewitched by the ideological allure of the euro, disregarding the technical warnings of its own staffers. In the end it immolated Greece in a “holding action” to save a dysfunctional monetary union. This was then covered up. Despite all that has happened, Prof Varoufakis remains an ardent enthusiast for the European project. How does he keep the faith?

“I have been trained all my life to oppose the Greek government, because that is what you do as a Greek patriot. That does not mean I want to dissolve the Greek state. “Would our countries be better off if we had “Brexits” everywhere and the EU disintegrated? I don’t think so,” he said.

Yet he also confided once that there is virtue in heroic failure.

Any Briton reading his damning account with an open mind might conclude that British democracy is best kept at a very safe distance from an EU that has so badly lost its way.