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Thursday, April 04, 2019

Thoughts from Galicia, Spain: 4.4.19

Spanish life is not always likeable but it is compellingly loveable.
            Christopher Howse: A Pilgrim in Spain

Note: As it's Thursday, some of the items below have been borrowed from Lenox Napier's Business Over Tapas 

Spain
  • Some potentially good visa news for Brits.
  • And some potentially useful info re Holy Week options.
  • Reports Lenox: The least densely populated area of Europe is not in Siberia (sic); it is in Guadalajara, where there are only 1.63 inhabitants per square km. 
  • One sometimes wonders if all Francoist tendencies have been eliminated from Spanish politics. Particularly those of the PP party. And, I imagine, Vox as well.
  • Andalucia is a funny place. Despite there being very high unemployment there, the last PSOE government failed to spend €3.7 billion allocated to job creation. There were at least come companies created and workers employed but these were (in)famously fake. Allowing millions/billions to pass into the hands of politics and their families and mates.
  • As I say, it's a funny place but I don't mean amusing. Certainly not to the poor folk who are the victims of the planning processes cited by Maura Hillen, President of AUAN, in a guest editorial in Business Over Tapas today. Which is reproduced below.
Local News
  • Here's a tree carver at work yesterday:-
  • Wolves are now breeding on the Costa da Morte. The Coast of Death. Literally.
  • If you're going to walk on the Camino Francés here in Galicia, you need to know that these places are badly lit:-


Brexit, the UK and the EU
  • All you need to know:-
  1.  The May-Corbyn customs union is constitutional nonsense and a total victory for Brussels. Says Ambrose Evans Pritchard, endorsed by Don Quijones. See his article below.
  2. A British prime minister is on a rack, with the EU operating one end of it and the leader of the Opposition working at the other end. 
Can you imagine a greater failure? I haven't dared read Richard north yet today . . .

The World
  • This is said to be a 'tremendously readable' new book - Blueprint: The Evolutionary Origins of a Good Society.
Spanish
English
  • Odd Old Word: Caputpurgia: 'Cleansers of the head'.
THE ARTICLES

1. Andalucian Practices

Maura Hillen, President of AUAN

When I look into the eyes of those affected by illegal houses, the vast majority nearly in their 80s, I think that enough is enough, that this useless suffering must be brought to an end. I also think it´s time to get rid of byzantine, cumbersome laws that do not work, and the sooner the better.

It is evident that urban planning in Andalucía has failed. Proof of this is the 300,000 illegal houses that exist across the region, a problem that probably affects around a million people, and could represent an investment of tens of thousands of millions of Euros. For any sensible person it is also evident that it serves no purpose to demolish these houses, as well as useless and unjust to knock down just a few, except in cases of obvious risk. Prevention is what is required and it is obvious that prevention has failed. That it has failed is not the fault of those affected, it is the fault of the administration. And what cannot be allowed is to keep these poor pensioners as a type of planning hostage until the planning system does its job – a planning system that clearly does not do its job.

The 16,000 people affected in Chiclana in Cádiz have spent 30 years waiting for the planners to resolve their problem, as have those in Carmona in Seville. And those on asentamientos in the Valley of Almanzora in Almería have waited for more than a decade. Enough is enough. Many of those affected in Chiclana and Carmona have running water just outside their plot or urbanisation and again, as if they were hostages, they are not allowed to connect, purely for reasons of planning dogma, in order not to “reward them” they are told. The truth is that the “rewarded” are sunning themselves on the beach whilst those affected live in inadequate conditions and without legal security.

It´s unfortunate that urban planning has been converted into an orthodoxy and this simply cannot be. What is required is a new philosophy in urban planning, one that walks hand in hand with citizens and their needs; a new philosophy that resolves problems and that doesn’t criticise the errors of others without being prepared to be self-critical at the same time.

For this reason, the announcement from the new government of Andalucía that they are going to take rapid measures is a breath of fresh air for thousands of people. These are statements of intent that give hope to those affected. They are no longer told “it’s very complicated” and “it must be studied”. They are told “we are going to resolve it”, “we are going to take action” and “we are going to work with the citizens”.

Those affected are not only hopeful, but also hope that this new “can do” spirit will spread, not only to the other political parties, but also to other branches of the Administration and the State. I believe that enough is enough with the demolition of houses, putting ordinary families into the street, and enough is enough of people not having basic services and legal certainty. In fact, enough is enough of damaging the environment because there is an unwillingness to regularise these houses, as enough is enough of trying to resolve a problem through planning, sometimes as an excuse for building more houses.

Therefore, we thank the Junta de Andalucía for their promise to deliver and I am sure that they will start to take steps rapidly. We hope that they can count on social and political support. Certainly, I will campaign for this resolution both personally and as President of AUAN. I will campaign in a constructive and conciliatory way, because people deserve politicians that concentrate on resolving their problems instead of wasting time fighting among themselves. Whilst I still have the energy you will find me campaigning to advance on the path of sensible planning, a path that I am happy to see is beginning to become clearer.  Maura Hillen, President of AUAN

2. The May-Corbyn customs union is constitutional nonsense and a total victory for Brussels:

So we lurch towards a permanent customs union and British infeudation as a non-voting member of the EU legal and regulatory system. This can end only in acrimony and years of bitter conflict with Europe.

Sooner or later an explosive issue will arise. It will become clear why a G7 industrial democracy with 65 million people cannot subcontract swaths of policy-making to a foreign power.  The constitutional arrangement is not viable. It guarantees an abrogation crisis down the road.

For good measure we are now more likely to get a radical-Left government as well, one with anti-globalist reflexes, confiscatory tax and anti-wealth policies, and possibly capital controls.

Personally I wanted some form of national government or joint Brexit council three years ago in the different circumstances of June 2016, before the well had been irreversibly poisoned. For Theresa May to do so now as a supplicant without a party behind her is fatal.

Her decision to defy the cabinet and expedite Brexit with Labour votes bestows legitimacy on a Labour leadership that has acted with shocking opportunism. It casts Jeremy Corbyn in the role of national saviour. It validates the media and global narrative of Tory obscurantism.

Whatever political price Mr Corbyn may pay among Northern Leavers for breaching his Manifesto, it will be more than offset by the repudiation of Toryism by the Conservative grass-roots. As Nigel Farage wrote in this newspaper, he will tear the Conservative Party limb from limb.

Currency markets have not yet turned their attention to this prospect. Goldman Sachs is for now doubling-down on its sterling positions, trading the diminished tail-risk of an immediate no-deal Brexit.

You can argue that the Withdrawal Agreement is itself tantamount to the customs union. It locks the UK into a ‘customs territory’ through the Irish backstop, and the EU holds the release key.

EU negotiator Sabine Weyand, told ambassadors behind closed doors that it “requires the customs union as the basis of the future relationship” and that the EU will “retain all the controls.”

At every stage of Brexit talks it has been the EU’s central objective to shoehorn Britain into the customs union and therefore into legal alignment. This prevents the UK from pursuing alternative economic policies. It protects Europe’s manufacturing supply chains and the EU’s £95bn trade surplus in goods.

Brussels offers nothing in return for services - 80pc of the British economy, and 44pc of total exports - where this country has a competitive advantage and a surplus that helps to offset the imbalance. Britain is the second largest exporter of services in the world. This was traded away lightly by the Cabinet Office in the interests of the foreign-owned car industry.

The EU has refused the principle of mutual recognition for services. We must make do with the thin gruel of equivalence. The asymmetry is striking.

Yet the Withdrawal Agreement does not entirely preclude the option of a Canada-style free trade deal in the future. The legal clarifications secured by the Attorney General make it harder for the EU to close the trap of the Irish backstop.

A paper by three eurosceptic professors for Policy Exchange -  Guglielmo Verdirame, Richard Ekins, and Sir Stephen Laws - argues that the risk has “receded significantly”. It would be a manifest breach of “good faith” for the EU to dismiss all new solutions to the Irish border out of hand. The UK could appeal to arbitration under international law.

Jean-Claude Piris, ex-head of EU Legal Services, says the beefed up documents have a “legally-binding character” and open the way for Britain “to suspend its obligations” in extremis.

To embrace a customs union in toto is to turn possible entrapment into certain entrapment. Some trade experts tell us with a straight face that Britain can still pursue a sovereign trade policy and do deals with the rest of the world. This is an empty truism. The US will walk away if we must maintain EU legal alignment.

We can knock on doors and seek a deal for services but this is a forlorn quest if we cannot offer access to our goods market as part of the package. Prof Alan Winters from the UK Trade Policy Observatory at Sussex University says no country has ever succeeded in negotiating a comprehensive free trade accord for services in isolation.

The customs union does not alone resolve the Irish border since most checks relate to phytosanitary standards and technical barriers (TBT).  Nor does it achieve frictionless trade. Labour has latched on to a chimera.

Companies still have to fill out ATR certificates. This is less onerous than rules of origin forms proving where goods came from - necessary outside the customs union - but the gap is diminishing fast with digital technology already in use in East Asia.

For this mess of potage the UK must accept profound restrictions on self-government. The likely terms are already sketched in the Political Declaration on Brexit. The UK will be subject to the EU Acquis covering the environment, labour law, taxation, competition, state aid, and trade policy.

Mr Corbyn will doubtless wish to toughen this further by insisting that the UK shadows future EU laws on employment, seemingly unaware that Switzerland’s trade unions oppose their country’s EU deal because it undercuts Swiss job protection. EU rules are set to the taste of transnational capital. When will the British Left wake up to this?

Former trade minister Greg Hands explains why the customs union is so toxic in a piece for CapX - "The worst of All Worlds" - that I highly recommend. The ‘Turkey Trap’ is already well-known. Ankara must open its market to new countries when the EU does trade deals but has no automatic reciprocity.

No doubt the UK could negotiate something better but the core fact remains that Brussels would be able to sell the British market to others as part of its negotiations with scant concern for our interests, and no democratic redress.

The EU would control trade remedies and anti-dumping sanctions. We would lose all ability to shape trade preferences for the developing world, depriving the government of a crucial instrument of foreign policy.

It is self-evidently unworkable. Mr Corbyn’s push for a customs union is to sacrifice democratic principle for the sake of supply-chains for global multinationals. The British people will rebel as soon as they discover what the small print implies. That will not take long, and the passion may come as much from Momentum, the young, and what is now the pro-EU Left, as it does from Tory Brexiteers.

While the car industry looms large in the public mind it is only 0.8pc of GDP. There are many ways for a sovereign government to blanket plants with support through the initial trauma of an exit on WTO terms. There would be some compensating trade diversion as factories switched output to the UK domestic market, displacing imports.

The public is in any case making up its mind. The latest YouGov poll suggests that 44pc of voters already prefer a no-deal Brexit if nothing is agreed by April 12  - against 42pc for Remain. There is no popular tide in favour of accommodation.

The EU’s Michel Barnier has switched to a new line. If there is no-deal, the British will face back a backstop 2.0 if they ever want a trade deal or a working relationship. “The Withdrawal Agreement we put on the table at the beginning of this negotiation will still be here: citizens rights, Ireland, financial obligations.”

Perhaps. But the EU will not be in the same circumstances. The eurozone might well be in recession with no monetary defences since rates are already minus 0.4pc, no mechanism for extreme fiscal stimulus, and a broken banking system.

It will be uncomfortably close to a debt-deflation crisis. Its industries and food exporters will be lobbying their own governments furiously for an end to the Channel stand-off. There will be a rise in the numbers of unemployed Gilets Jaunes in Hauts-de-France.

Ireland will still be there but roles will be reversed. It is the EU that will have to clarify how its inflexible demands are compatible with the Good Friday Agreement. Solidarity - absent for the Irish in the Trichet letter of 2010 - will be put to the test.

Taoiseach Leo Varadkar is already a convert to the technology solutions rejected when first suggested by Britain.  "Some things can be done remotely, the collection of tariffs for example. Customs duties can be collected as other taxes are, either online or into tax offices. We know how to intercept smuggling."

“When it comes to animal checks, it’s much more difficult,” he said. Indeed.

It is reduced to this: a tiny trade in animals and food across the border, a rounding error in UK trade data, for which there are intra-Irish solutions if the EU is remotely reasonable. The Commission’s weaponisation of a neuralgic historical issue, for ulterior purposes, is exposed for what it is.

Let us accept a no-deal, reshuffle the diplomatic pack, and determine what is true and what is not true.

If there really is a backstop 2.0 forever, then let us trade with the EU on WTO terms forever and put all our efforts into a free trade deal with the US and into membership of the Trans-Pacific Partnership. At least we will be a self-governing democracy.

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