Alistair Darling lets cat out of bag...

Spotted by Denis Cooper in Hansard, 2 November 2011, column 919:

Mr Alistair Darling (Edinburgh South West) (Lab): When the Prime Minister goes to the G20 meeting over the next couple of days, will he try to persuade his colleagues of the urgency of coming up with some detail on the eurozone settlement reached last week? It is not at all clear how on earth Greece will get out of its difficulties, even if the referendum passes. European banks will need shoring up well before next summer, and as for the new rescue fund, which may be needed sooner than we think, it does not actually exist.

Next week? That could be years away!

From the BBC:

William Hague has warned Tory Eurosceptics hoping to get powers back from the EU that the opportunity for doing so could be "many years" away.

Many Tory MPs believe that the UK has an opportunity to repatriate some powers if eurozone states seek closer fiscal integration and a treaty change. But the foreign secretary told the BBC: "We are not at that point."

Funnily enough, the EU is currently trying to bully the eurozone states into 'closer fiscal integration' (via things like the ESM, and secondary to that, the EFSF, both of which are completely not allowed under the existing Treaty as it stands) and, because this requires an amendment to the actual EU treaty, the amendment itself does require the agreement of the UK parliament (which they are currently looking at).

On the one hand, it isn't up to the UK to interfere in treaties between other countries, but on the other, now would be an absolutely ideal time to ask the EU to 'repatriate some powers' to us.

So I think what Hague actually means is "The current amendment to the Treaty seems fairly minor and technical to most people, who all assume that the ESM, EFSF etc is a done deal anyway, so we can get away with not calling an in-out Referendum holding any sort of referendum whatsoever, because we only promised you one of those if there was a 'major transfer of powers'" which, to be fair, is probably true if you squint at it sideways in bad visibility.

But what the "many Tory MPs" said is absolutely true on face value, no squinting involved. They must really hate Hague by now.

"Investors Losing Money on EFSF Bailout Bonds"

Denis Cooper spotted the headline at Bloomberg, where the article been hastily replaced with something completely different (but the url gives us a clue as to the original content).

He finally tracked down the article in the San Francisco Chronicle:

Investors are losing money on bonds sold by Europe's bailout fund as optimism ebbs about policy makers' ability to contain the economic crisis.

The 440 billion-euro ($588 billion) European Financial Stability Facility has sold 13 billion euros of bonds and all are under performing relative to alternative investments such as debt of Germany and France.

Anyone who sold 1 million euros of German five-year bonds to buy the EFSF 2.75 percent, 5 billion- euro bond issue repayable in July 2016, lost 50,000 euros, data compiled by Bloomberg show. Switching into the EFSF bonds due in December 2016 would have cost a buyer more than 34,000 euros.

"That's telling you that global investors are losing confidence in the whole EFSF apparatus," said Michael Riddell, a London-based fund manager at M&G Investments, which oversees about $323 billion of assets...

Well worth a read.

"Government by international treaty"

Denis Cooper coined this phrase a few years ago, and he emailed me a good example today, (which he also posted on the relevant thread at Con Home). From Hansard:

Mr Dominic Raab (Esher and Walton) (Con): The European investigation order would allow police and prosecutors throughout Europe to order British police to collect and hand over evidence... Britain has until 28 July to decide whether to opt in or, like Denmark, to opt out. Will the Leader of the House indicate when the Government's decision will be made, and will the House have an opportunity to debate the measure in advance?

Sir George Young: I am grateful to my hon. Friend. He says that the Government must decide by 28 July what action to take. I will certainly ascertain from the Foreign and Commonwealth Office or the Home Office, whichever Department is the appropriate one, what action they propose to take in response to my hon. Friend's question.

As D says, "That the Leader of the House is unclear which department of the British government now has responsibility for the activities of the British police speaks volumes about the constitutional confusion created by EU membership.... We seem to have entered a new phase where the Foreign and Commonwealth Office is in part a kind of Colonial Office in reverse, with the instructions coming in rather than going out."

William Hague on top form

From The Telegraph:

[William Hague] also pledges new action against any moves to use the Lisbon Treaty to end national vetoes in key areas of policy in favour of “qualified majority voting” (QMV).

“If, for instance, Europe were ever to decide that foreign policy is no longer by unanimity but by majority voting, that would constitute, to us, the transfer of a new competence and power to the EU, and that would trigger a referendum. So we are very serious about the referendum lock and defining that carefully in law.”

He's being rather disingenous here, because foreign policy decisions can already be taken by majority voting in the Council [i.e. Council of Ministers], with the fallback that "for vital and stated reasons of national policy" the representative of a member state can try and stop a vote being taken and get the decision referred up to the European Council.

See Article 31(2) of the TEU. I can't give you a page number, as they have published the TEU and the much longer TFEU as one long pdf file without page numbers to make things more difficult to find. But Article 31(3) then says that The European Council [Which means Rompuy plus Barroso plus heads of all member states] can allow the Council of Ministers to act by majority voting anyway...

2 ... the Council shall act by qualified majority:
- when adopting a decision defining a Union action or position on the basis of a decision of the European Council relating to the Union's strategic interests and objectives, as referred to in Article 22(1),
- when adopting a decision defining a Union action or position, on a proposal which the High Representative of the Union for Foreign Affairs and Security Policy has presented following a specific request from the European Council, made on its own initiative or that of the High Representative,
- when adopting any decision implementing a decision defining a Union action or position,
- when appointing a special representative in accordance with Article 33.

If a member of the Council declares that, for vital and stated reasons of national policy, it intends to oppose the adoption of a decision to be taken by qualified majority, a vote shall not be taken. The High Representative will, in close consultation with the Member State involved, search for a solution acceptable to it. If he does not succeed, the Council may, acting by a qualified majority, request that the matter be referred to the European Council for a decision by unanimity.

3. The European Council may unanimously adopt a decision stipulating that the Council shall act by a qualified majority in cases other than those referred to in paragraph 2.

From an email by Denis Cooper.

British European Summertime

Tobias Ellwood MP advances the case for abandonding the silly ritual of putting the clocks forward an hour to BST in March and then back an hour to GMT again in October over at ConHome.

AFAICS, the only upside to this ritual is to provide us with a brilliant pub-quiz type question ("Which is the longest month?"), and I am pretty much sold on the idea of leaving our clocks permanently at BST. To be fair, the only way to find out whether the advantages outweigh any disadvantages (and there must be some - perhaps there'll be more people throwing in the towel if they have to go to work in the dark for several months in winter, but we won't know until we've tried) is just to leave our clocks at BST for a year or two, see what happens and then maybe have a vote on it. Or have a vote on it first. But it must be worth serious consideration.

UPDATE: Re 1968 - 72, see the comments to this post.

Anways, Denis Cooper, who knows about stuff, wades in (on a later thread):

As I have pointed out in a detailed comment on Mr Ellwood's article, this is a matter of EU law - Directive 2000/84/EC - which cannot be changed unilaterally by the UK government.

The UK government does not have the freedom to do what Mr Ellwood wants, which is to move clocks forward by one hour for the whole of the year, unless it also moves them forward by an additional hour for the agreed period of summer time:

"Article 1: For the purposes of this Directive "summer-time period" shall mean the period of the year during which clocks are put forward by 60 minutes compared with the rest of the year."

The concluding passages of my comment may seem harsh, but I'm fed up to the back teeth with UK politicians, especially Tory politicians, abusing their positions of trust by deliberately pulling the wool over the eyes of the public about the EU:

"If Mr Ellwood is unaware that this matter which so greatly exercises him is subject to existing EU law, which cannot be changed unilaterally by the UK, then he's unfit to be a government minister. On the other hand, if he is aware of the EU law but he deliberately chooses not draw the attention of readers to its existence, then he is unfit to be an MP, let alone a government minister."

I stand by that.

Power Grab Of The Week

Condensed version of email from Denis Cooper (with kind permission):

"An EU official has told The Times of Malta that one item in the draft conclusions of the two day EU summit which starts today, will be to extend the term of the EU Commission for an extra six months.

I've looked carefully, and there is definitely no specific legal basis for extending the term of the Commission under these circumstances, not even in a "caretaker format". And over two weeks ago I emailed the office of Commissioner Neelie Kroes about it, and the bloke (one Jonathan Todd) broke off the exchange when I posed the question: "But on what legal basis could the Council of Ministers authorise the present Commissioners to remain in post beyond the end of their five year term, which expires on October 31st?"

Anyway, they think they can do whatever they please by invoking the catch-all Article 308 TEC, on pdf page 179 here:

"If action by the Community should prove necessary to attain, in the course of the operation of the common market, one of the objectives of the Community, and this Treaty has not provided the necessary powers, the Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament, take the appropriate measures."

Although in this case they might have a problem consulting the European Parliament before midnight on Saturday."

Let's just check what The Bill Of Rights 1688 has to say ...

Vis à vis the whole sory episode of Geert Wilders being prevented from attending a screening of his film Fitna at the House Of Lords, Denis Cooper points out (via email) that The Bill Of Rights 1688, paragraph 9 states as follows:

"That the Freedome of Speech and Debates or Proceedings in Parlyament ought not to be impeached or questioned in any Court or Place out of Parlyament."

Said is said.

Reader's letter of the day

From yesterday's London Lite:

DAVID CAMERON could easily save the Irish from the pain of a second referendum on the Lisbon Treaty. Pledge as Prime Minister to hold the long-promised referendum [in the UK] and that should kill it off for good.

Dr D R Cooper, Maidenhead.

The full, unedited version appeared in The Scotsman.

Reader's letter of the day

Denis Cooper in today's FT:

Sir, It is reported that the Irish government will demand up to €2bn to guarantee potentially €500bn of bank deposits over the next two years, an annual charge of 0.2 per cent. On the other hand, the banks are pressing for a charge of only 0.1 per cent a year.

Perhaps banks would prefer to seek commercial insurance. It would certainly be interesting to see what premium rates were offered by insurance companies once they had examined the books of each bank in detail and assessed the risk. Indeed, would this not be a better mechanism for providing ordinary savers with an ongoing guarantee that all money on deposit would be 100 per cent safe?

Change the law so that licensed retail deposit-takers must take out insurance with two or more approved but competing companies to cover the total money in all personal savings accounts; and insist premium rates are frequently adjusted to reflect changes in risk, and widely publicised. The saver would have an indication of which institutions were pursuing riskier business models and could choose to avoid them; the taxpayer would never be called on to bail out the saver - except, of course, in the last resort, if one of the insurance companies failed.

Dr D R Cooper, Maidenhead, Berks.

A Romanian MEP speaks ... Denis Cooper responds

Romanian MEP Adrian Severin: "The EU cannot exist without France, without the founding countries. But it can live without Ireland." (page slow to load)

Denis Cooper (via email): "What a bloody cheek from this Adrian Severin. Who the hell does he think he is? ... The EU ... could perfectly well live without Romania, as well, and in fact did so until just 18 months ago. And, guess what, hardly anybody in the UK wanted Romania in the EU, and if we'd been given a choice in a referendum we would certainly have voted against it."

China as the lender of last resort

Inspired by an article in The Times, Denis Cooper (via email) has followed through the logic:
......................................
As of July 2008, China had $1.8 trillion in accumulated foreign currency reserves, the result of its exports to the west, outstripping Japan with $1.0 trillion:

I stand to be corrected, but I guess -

a) The Chinese could offer to buy "toxic assets" from the western financial institutions and sort and recycle them, rather as they've been taking our physical rubbish and sorting and recycling it; but

b) They wouldn't know what price to pay in order to be sure of making a profit, as nobody can say how much of value there is any of those "toxic assets"; and

c) They can't be allowed to pay an absolutely safe rock bottom price, because then the western financial institutions would get so little cash that it wouldn't go far towards solving their liquidity problem; so

d) The Chinese will go for the infinitely safer option of buying US Treasury bonds, expecting that US taxpayers will be able to repay them with interest; and

e) The US government will then use that money to buy the "toxic assets" from the financial institutions, possibly at a discount to their real value; but

f) If the discount was too great, once again the institutions would get too little cash to solve their liquidity problem; and

g) As the US government is now a buyer in the market, and is known to be desperate to shore up the institutions, and is also known to have effectively unlimited supplies of taxpayers' money at its disposal, it will probably end up buying the "toxic assets" at a premium to their real value; so

h) When it's all been sorted out, which may take a decade, because a lot of it ultimately involves residential property and there'll be political sensitivities about the US government repossessing people's homes;

i) The Chinese will have got their money back, with a profit, while the US taxpayers will have recovered some but probably not all of their money - it was about half last time round:

"In the 1980s Resolution Trust Company rescue, the government had the power to take over any distressed Savings and Loan bank and close it or sell its assets as necessary. This eventually meant that about half of the $400bn rescue package was recovered - but most of the banks closed for good"; and

j) At least most of the larger institutions will have been saved from the consequences of their own recklessness; and maybe

k) The Chinese will also have helped out the US government by investing in some of that residential property, at attractive prices, so that significant numbers of Americans will be renting their homes from companies owned by the Chinese government.
.............................
I can't fault that, having come to much the same conclusion myself. The ultimate source of all these 'easy credit' must be China and the petro-states, and to a lesser extent, Japan. The mortgage borrowers can't or won't repay what they borrowed, and China will demand/will be fobbed off with some other assets instead.

"The best way for Britain to belong to Europe"

The Telegraph leader explains how at great length.

Denis Cooper sums it up thusly:

Not at all, of course; Britain should belong to the British.

Said is said.

Denis Cooper fisks Dave The Chameleon

Orginal article here.

"This is not some quarrel in a far-away land." Yes it is.

"What happens in Georgia directly affects us." Only if we allow it to do so.

"For a start, it's about energy security." Could that be because Thatcher shut down our coal mines, and by accepting and promoting the theory that carbon dioxide emissions would wreck the planet made it difficult for the industry to be re-started?

"The Baku-Ceyhan oil pipeline ... runs right through Georgia". It was put there to avoid crossing Russian territory, while also avoiding Iran and Armenia, despite the obvious fact that it would still be vulnerable to Russian attack - so what should we do, base British troops in Georgia to defend it?

"History has shown that if you leave aggression to go unchecked, greater crises will only emerge in the future". That's what Eden thought about Nasser, and look where that got us.

"... stability in the Caucasus ... is a matter for the security of Britain and our allies." Up to a point, but it could also be said about many other troubled parts of the world.

"we should accelerate the path to Nato membership for countries such as Georgia, and other democracies such as Ukraine, if that is what they wish." In other words, the Georgians et al should be given the option of committing all the present Nato members to go to war, including nuclear war, in their defence.

"The lack of clarity about Georgia's prospects of joining Nato contributed to the present crisis." The starting point was the very suggestion that these five former Soviet republics might follow the former Soviet satellite states and the former Soviet Baltic republics by first joining Nato, and then the EU.

"It encouraged Russia ... because the West was divided and uncertain." With good reason - because history has shown that making a solemn promise that you will go to war in the defence of another country can have devastating consequences.

"The knowledge that Nato membership was a real prospect would have provided Allies with greater leverage over the actions of Tbilisi's government." Actually just the rather remote prospect of Nato and EU membership seems to have gone to their heads, with the President appearing on TV flanked by the Georgian and EU flags.

"Of course France holds the EU presidency. But that is not a reason for Britain to sub-contract our entire response to the crisis to our allies." So which party started the process of sub-contracting our foreign and defence policy to the EU, under the Maastricht Treaty?

"We could be pressing for the negotiation of the strategic partnership between the EU and Russia to be suspended." Or we could press to leave the EU out of it, and instead ask the UN to convene a traditional international congress of all interested sovereign states and other interested parties to work out a new and durable settlement.

From Denis Cooper, via email (reproduced with kind permission of the fisker).

"Where dangerous ideas can take us"

Denis Cooper's letter in today's FT:

"Sir, Donal O’Brolchain (Letters, June 11) quotes Pericles and Swift to support a dangerous idea: that ordinary people should be able to understand how they are governed. It is easy to see where that kind of thinking could lead.

Unfortunately, it proved impossible to stop the spread of universal suffrage to most countries around the world, but is Mr O’Brolchain seriously suggesting that hoi polloi should be allowed to assume a real, rather than a notional but almost entirely fictitious, control over public affairs?

If that was seen as acceptable, surely our wise political leaders would not have worked so hard to establish this new and incomprehensible system of government, “government by international treaty”, which has been specifically designed to neutralise the harmful effects of excess national democracy?"

This is up to his usual high standards, I particularly like the phrase "government by international treaty", which is ^TM Denis Cooper.

Point/counterpoint

Mandelson: I didn't accuse IFA of lying

Dr D R Cooper: Oh just f***ing well shut up, Mandy.