Thoughts from Pontevedra, Galicia, Spain: 3.2.21

 Night’s candles are burnt out, and jocund day stands tiptoe on the misty mountain tops.

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

- Christopher Howse: 'A Pilgrim in Spain'

Covid

Loss of smell was ignored at first as an indicator but is now seen as the most reliable marker.

See the insightful article below.

Another useful Spanish treatment.

American slang for the virus has reached Spanish kids:  La Rona, from Corona. La rona, is actually ‘mange’ in English.

I haven't yet made up my mind whether this guy is a genius or a nut. Or both, perhaps.

Living La Vida Loca in Galicia/Spain .

Well, as I said, vaccine queue jumping isn’t confined to Spain. Or Germany. The BBC has reported on this happening in Wales.

And a reader has advised that several Spanish officials have been find for engaging in it. Which is good news.

One thing that shouldn’t survive Covid. Read an anti-bullfight opinion here.

This is one of the tracks I've been negotiating in the last few days:-

And this is a long-distance foto of the Marismas de Alba - the Marshes of Dawn - that I pass through en route to Pontevedra 4 times daily. Or used to. It's a very poor foto but it does illustrate how the marshes - where water isn't usually visible at the surface - are being rapidly turned into a single large lake:-

 

Reader Perry thinks the chozo/chouzo/choza/chouza is for shepherds to shelter in. Given that it’s on top of a windswept peak in the middle of a rock-strewn forest, and there are no sheep around for many, many kilometres, I prefer to go with María’s suggestion it is/was for fire wardens.

My latest gas bill is based on an estimate and, of course, is higher than the actual. To do something about this I have to go on line, cite my ID and upload a foto of the actual reading. Which will be way more than the total of the estimate date of 11 January, 23 days ago. Twenty five years ago, in the UK, I could just fill in a pre-paid card left by the ‘inspector’ when I was out, and mail it to the gas company, so that the bill would be accurate. But perhaps it’s a lot more complex as well in the UK nowadays. Though I doubt it.

Talking of customer service . . . I had problems yesterday paying by VISA for wine I wanted to order. I advised the bodega - from which I’ve ordered several times before - of this but their reply essentially was that it was my fault, as their web page worked perfectly. They suggested I go through the entire process again but this time I should opt for a bank transfer. I replied there were plenty of other wine suppliers in Spain and counter-suggested they deliver the order and send me a bill with their IBAN on it, so I could then make a transfer. Otherwise there’d been no order. This had the desired effect of reminding them what good customer service was. For anyone, never mind an existing customer. BTW . . . To be very specific, the bodega didn’t start their initial response with anything like "We're sorry to hear. . ." But did eventually get their tone right.

Here’s María’s Tsunami, Day 2

 

Germany

No such thing as euros-cepticism exists in the Federal Republic. At least not in the way it is understood in its various forms in the UK, the Netherlands, the Nordics, Eastern Europe, France, Italy, or (spasmodically) Ireland. But the scale of this error has left its mark on the German collective mind. 

See the second article below for AEP’s views on longer term consequences of the ‘vaccine fiasco’.

 

The EU

The vaccine saga exposes a great number of EU pathologies, starting with the breathtaking absence of apology. Heads would roll in a democratic state. The EU’s constitutional structure shields the executive from accountability.

The betting is that, for one political reason and another, Mrs vdL won't lose her job. Resignations in response to failure have sadly fallen out of fashion in the UK but have rarely been à la mode in the EU. 

The Way of the World

British Celebrities have been ordered by the Advertising Standards Agency not to use photo filters to exaggerate the effectiveness of beauty products they promote, after Instagram influencers were caught making their fake tans appear darker. As if they will.

Still in the UK . .  The quango Ofcom used to monitor broadcasters for ‘hate speech’, utilising just 4 categories - race, sex, religion and nationality. As of Jan1, there are now 14 categories: disability, ethnicity, social origin, gender, sex, gender reassignment, nationality, race, religion or belief, colour, genetic features, language, political or any other opinion. But I expect it'll eventually be reduced to just one - anything.

 

Finally . . .

The problem I had in paying for the wine by VISA arose from a security measure I’d never seen before - involving 2 numbers from my PIN and a code sent to my phone. I completed the process as I understood it, twice, but without success. If any reader has mastered this, could they please tell me which of these goes in the box, assuming PIN numbers of 3 and 4 and a code of 1234

3 4 1234

341234

7 1234 where 7 is 3 +4 (as implied in the instructions)

71234

To be positive . . . At least if you don't go out much because of Covid risk, you don't have to worry about your phone being under-charged. So, not all bad.

 

THE ARTICLES

1. Beating Covid requires luck as much as skill. It’s easy to forget that the decisions behind vaccine rollout were made by the same people who botched PPE and tracing: Daniel Finkelstein The Times

I need to start this column about our performance on Covid-19 by telling Einstein he got it wrong. The great physicist famously said that “the definition of insanity is doing the same thing over and over again and expecting a different result”. This is, in fact, pretty much the opposite of the truth. The definition of insanity is doing the same thing over and over again and expecting the same result.

Of course this quote isn’t really Einstein’s. While it is attributed to him over and over again, the attribution is wrong each time. Which isn’t surprising since believing that doing the same thing produces the same result on every occasion is a mistake that wouldn’t be made by a GCSE maths pupil.

Anybody who studies even elementary probability knows that repeated actions produce slightly different outcomes at random. The more times you repeat the action, the more likely you are to get a useful average, but the outcome of each individual repetition is still likely to vary both from the average and from the outcome of the next repetition.

While familiar to maths students, this statistical observation passes many historians and political analysts by. Which is apparent when you consider the debate about our vaccination programme and the contrast with other policies we have put in place to fight Covid.

Everyone has noticed that while it is fair to describe our achievement on vaccination as world-beating, it is absurd to use that term, as some ministers have, to describe other aspects of policy. Most notably, of course, we have a horrifically high death rate, we have spent a lot of money on a tracing system while struggling to make it work and (let’s put this delicately) not every contract we have concluded for personal protective equipment seems, at first sight, to have been good value.

The temptation is to conclude that sharply different ways of working and sharply different people must have been responsible for one outcome rather than the other and that the situation would be much better if only we had done to everything else what we did with the vaccine.

But I have reached a more uncomfortable conclusion. I think we did broadly the same things over and over again and got different results.

It is interesting now to read the coverage of vaccines chief Kate Bingham from last year, in the period when she was considered a fool with an outsize interest in PR, before everyone realised she was a genius who had saved the country. Almost every article had a “here we go again” tone to it. She had been picked by Boris Johnson without an open competition for the role, she wasn’t a vaccines expert, she had “been to school with the prime minister’s sister”, she was married to a Tory minister and the Tory minister had “been to Eton with Boris Johnson”. It’s all exactly like Dido Harding — and look how tracing turned out.

The thing is that all of these things are still true. That Bingham’s efforts have been successful hasn’t changed any of it. Not the bit about no open competition or knowing Rachel Johnson or being married to Jesse Norman or it being like the appointment of Harding.

Listen to Bingham’s description of how she set about putting us in pole position on vaccines. We rejected the European programme because we thought Britain could do better with its own ideas and flexibility. The team then sought to be nimble and used personal contacts to make deals. The country bet big and early on some vaccines and the bets came off.

This is all very impressive, as is Bingham, but each part of this explanation of success — the nimble informality, the use of personal contacts, the confidence that Britain had a better way, the leadership of someone trusted by ministers who has commercial expertise — has been used as an explanation of failure at a different point in the Covid crisis.

We appreciated this similarity when we thought Ms Bingham would fail but forgot all about it when she succeeded.

Ursula von der Leyen provides an interesting counterpoint. It wasn’t long ago (six weeks?) that the president of the European Commission was being praised for her maturity and her negotiating skills as we reached the last stages of the Brexit talks. Now she appears to be a terrible negotiator, whose response to failure has been notably immature.

How likely is this? She is the same person after all. The truth is that the EU approached vaccine procurement and its failures in exactly the same way it approached Brexit, but with different outcomes. It was bullish and self-confident, highly centralised, completely unyielding, opaque and somewhat graceless.

When the government claims successes or its critics point to failures, both have a tendency to ignore the role of randomness, of luck, of complexity and of risk. Let me use as an example a criticism I made of the government.

I argued in the autumn that the restrictions would not prove tough enough and it seems I was right. Yet my argument was based on the idea that there would soon be a vaccine that worked, something that wasn’t obvious at the time.

If that judgment had been wrong then, far from being insufficiently tough, the restrictions might soon have been thought pointless and unsustainable. The government would still have been open to criticism but from entirely the opposite direction.

The success of the vaccination programme rests on bets, some of which we know are correct and some of which we do not. We chose vaccines that ended up working while the EU was distracted by a French option that hasn’t come off. But what if it had been the other way round? It looks like our early approval of the vaccines will be vindicated and many are confident that our delaying of the second shots is a sensible move. But what if it turns out we were wrong?

If we had been unlucky with our vaccine decisions it wouldn’t have turned the programme leaders retrospectively into fools or incompetents. None of this is to argue that we can’t make judgments about our actions, still less that we haven’t made mistakes, or that no one has been found wanting. Some government decisions I’ve found baffling. While it is possible that our death rate will end up varying little from that of similar nations, it looks as though it will be worse and that part of the explanation will be decisions we took or failed to take.

Yet when we assess which they were, we need to look at whether the choices we made were reasonable ones in the circumstances and not just look at how the choices turned out.

2. Furious Germany will not forget EU vaccine disaster when Brussels seeks more bailout money. The EU has only itself to blame for its vaccine saga, as its botched pandemic response exposes cracks in the union: Ambrose Evans-Pritchard 

The EU’s vaccine disaster is not enough in itself to crystallise Germany’s mounting exasperation with Brussels and the European Institutions.  But it vastly complicates the next big test of the Brussels regime: how to prevent another lost decade and a sovereign debt crisis in the Club Med bloc, and who will pay for the rescue.

No such thing as euroscepticism exists in the Federal Republic. At least not in the way it is understood in its various forms in the UK, the Netherlands, the Nordics, Eastern Europe, France, Italy, or (spasmodically) Ireland. But the scale of this error has left its mark on the German collective mind. 

Die Zeit calls this episode “the best advertisement for Brexit”. Bild Zeitung calls it “checkmate Brussels”. There is a knock-about feel to these outbursts.  What ought to worry the Commission and Germany’s pro-EU elites more is a deeper critique of the EU project from very well-informed quarters.  

Daniel Stelter, Germany’s corporate guru, writes in the insider publication Manager Magazin that this crisis has exposed something rotten at the core. “It is dawning on the German and European population that the political class has failed across the board in meeting the enormous economic and social challenges of the Corona crisis. It marks the accelerating decline of the EU,” he said. 

He accused politicians of “trying to throw sand in our eyes” and seeking to divert blame with squalid populist gestures. “Everybody in the economic sphere now knows that whenever there is a problem at a production site in the EU, there is a risk of being hit with an export ban: vaccines today, biotech tomorrow, and the day after tomorrow what?” 

“This destruction of trust in the EU as a place of business (Standort EU) is all of a piece with its tendency towards over-regulation and planned-economy control. The gap between wish and reality in the EU is greater than ever. By failing to procure vaccines, the EU has validated Brexit and given all EU citizens an objective reason for euroscepticism,” he said.

The danger for Europe lies in the intersecting effect of vaccine paralysis and an even longer economic downturn. The glacial roll-out and lack of doses may delay recovery by three months. That is an extremely expensive failure in terms of political credibility and recessionary metastasis.

“We see the EU's vaccine crisis having three successive inter-related effects: a prolonged lockdown, a longer second leg of our double-dip recession, and an anti-incumbent mood,” said Wolfgang Münchau's EuroIntelligence.

The vaccine saga exposes a great number of EU pathologies, starting with the breathtaking absence of apology. Heads would roll in a democratic state. The EU’s constitutional structure shields the executive from accountability. Ursula von der Leyen breezily insisted yesterday that the handling of vaccine procurement had been a great success.

Sandra Gallina, the EU trade negotiator elevated to director-general of health, was defiant before a committee of Euro-MPs. The EU is in the “top league” on vaccine roll-out. “I’m not jealous of what Biden is doing because in actual fact the situation here in Europe is, may I say, better,” she said. On vaccines? Really?

Officials cannot shake the habit of self-congratulation. Martin Selmayr, the Commission’s eminence grise, tweeted that the jabs were proceeding marvellously: the EU had vaulted ahead of Africa. Such is the pontine doctrine of Commission Infallibility.

The errors made in acquiring vaccines were not accidental. They were inherent in the ideology of the institution. This dysfunctional culture keeps making mistakes each time it ventures into a new terrain, and then has great trouble correcting itself. Without revisiting the maddening themes of farm and fish policy, what about the EU’s first stab at a carbon emissions trading scheme? It was a byword for market illiteracy. Nobody died. It has now been reformed. But you don’t get such a second chance in a pandemic.

In this case it was an elemental error to put trade hagglers in charge of a health emergency. Rather than spend months trying to drive down the price - when the imperative was time - the Commission should have done the opposite. Germany’s IfO Institute said it should have paid a dose premium to bring forward production since the cost of pandemic measures in lost GDP is hundreds of times greater. IfO calculates that the economic utility of each shot is €1,500. 

The EU treated Big Pharma as the enemy when it should have been pulling out all the stops to help these companies. “Liability and indemnification, these were really important for us,” said Ms Gallina yesterday. Well quite. That was the problem.

One can sympathise with the desire to hold the 27 states together, which necessarily slows everything down and leads to the lowest common denominator. “Just imagine what might have happened if some richer or luckier member countries such as Germany, the home of BioNTech, had used their clout and deep pockets to secure a disproportionate share of vaccines for themselves,” said Holger Schmieding from Berenberg Bank. 

But even here, the Commission’s motive was in part to take Big Pharma down a few notches by acting as a unified bloc and showing who was boss. It was about power. Just as the Brexit negotiations were about power, not trade, and certainly not about peace in Northern Ireland.  

However you distribute the blame, the fact remains that the Commission seized on the pandemic to increase its powers and then botched the operation horribly. So what will this mean for confidence in its management of the €750bn Recovery Fund, the other great power-grab by Brussels since Ursula von der Leyen took the helm?

The German, Dutch, Austria, and Nordic parliaments are already suspicious over the use of this slush fund. Allegations that Italian premier Giuseppe Conte was conspiring to siphon off money for political patronage triggered last week’s collapse of his government. The Bundestag’s Grand Inquisitor, Wolfgang Schauble, is already growling.

It is going to be much harder to rustle up another fiscal stimulus, a Recovery Fund Mark II. One awaits the icy response when Northern taxpayers are asked to cough up hundreds of billions more. Germany agreed to fund big transfers after the first wave of Covid because Italy and Spain had been devastated, while the North had been largely spared. Nobody has been spared this time.  

But if there is no mega-stimulus, Club Med will be left languishing in structural depression, notwithstanding an initial  dead cat bounce from reopening. One thing everybody agrees on is that monetary union cannot survive another protracted slump in Italy, Spain, Portugal and Greece. The debt ratios will spiral higher. Polities will react.  

Berlin will have to decide whether to embrace a genuine fiscal and debt union: the Hamiltonian solidarity - all for one, and one for all  - that was carefully dodged last year. The decision may have to be made in the run-up to the German elections in September in a mood of disgust over the vaccines. “Germany is going to have another moment of truth,” said David Marsh, head of the Official Monetary and Financial Institutions Forum.

We have yet to discover how much financial and economic damage has been done below the water line by Covid. Delayed recovery undoubtedly means that debt legacies in southern Europe will be even worse than suggested by the main forecasting bodies just weeks ago. Italy’s debt may approach 170pc of GDP.

The default policy setting in the eurozone is austerity-lite. Covid relief is winding down across Club Med. It is not as bad as the demonic tightening after the Lehman crisis but arguably the needs are even greater this time. Bank of America says there is a fiscal gap of 10pc of GDP. 

The contrast with the Rooseveltian blast-off policies in the US is staggering. If Joe Biden gets most of his latest stimulus package, the accumulated total will be 25pc of GDP in direct crisis relief and fiscal transfers since last March.

The EU’s €750bn Recovery Fund is more publicity stunt than macro-stimulus. Half come in the form of loans that mostly displace borrowing that would have happened anyway. The €390bn in actual grants is spread over five years between 27 countries. Italy will receive just 0.7pc of GDP a year once its own payments as an EU net contributor are stripped out. The sums arriving this year are just a trickle.

“Since last summer a bubble of complacency has surrounded the EU’s recovery package,” said Prof Adam Tooze from Columbia University. The Recovery Fund has already been dwarfed by a 10pc collapse in fixed capital investment last year, compared to 1.7pc in the US.  

“By virtually every measure, the recession in Europe in 2020 was far worse and the policy response less adequate. The conclusion is inescapable. For all the commendable determination to avoid the mistakes of 2010, the ECB, Europe’s governments and the Commission have not done enough. What Europe needs most of all is a second big fiscal push,” he wrote.

Once again, the ECB will have to paper over trouble with funny money. It will have to continue its disguised (or at least denied) monetary-fiscal rescue of southern European governments. Should it cease to do so - or even hint at an end to bond purchases - markets will take instant flight. The implicit sovereign bankruptcy of Italy will become explicit. Debt restructuring will be on the table. That will unleash the political demons.

The German constitutional court - the self-described “people’s court” - has already ruled that the ECB is acting ultra vires and beyond its legal mandate. None of us know whether Germany will let the ECB go full Reichsbank or whether it will finally say that enough is enough. But either way that decision will have to be confronted over the next year or two. When it comes, the vaccine nightmare will not be forgotten or forgiven.