Look Left – The Libor scandal, euro joy for Spain & Italy, and the Queen meets McGuinness


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• The Libor rate-rigging scandal looks worse by the hour, with RBS today dragged into the story.

It emerged this afternoon that taxpayer-owned RBS had to fire four traders for involvement in Libor-fixing last year. The news follows the revelations of Barclays’ rate-fixing deceit.

Ed Miliband, writing in today’s Sunday Mirror, said people were “right to feel angry” at the “appalling behaviour” of some bankers, and that it was time for the government to stop “wringing its hands” and “show some leadership”.

Yesterday, in a speech to the Fabian Society Summer Conference, he turned up the heat on David Cameron over the scandal, calling him “out of touch” for his failure to call for an inquiry, saying the public “will not tolerate the establishment closing ranks”, that “nothing less than a full public inquiry” will suffice.

There’s more on Miliband’s Fabian speech in our report here, and for more on the Libor scandal, read our reports on the growing calls for an inquiry here; on the shameless, two-faced opportunism of the deregulation-loving George Osborne here; and Miliband’s call prosecutions, proper regulation and an end to the “casino culture” here.

And tomorrow morning on Left Foot Forward we’ll have the thoughts of Ed Balls as the Finance Bill reaches its final stages in the House of Commons.

 


This week’s most read:

1. Miliband redirects Barclays rage to Cameron over PM’s inaction Shamik Das

2. One of Gove’s free schools gets only 37 applications for September Katie Stanton

3. Watch: Osborne’s deputy’s deputy’s deputy’s deputy Chloe Smith gets Paxo’d Shamik Das

4. Tory youth adviser blames hip hop music for the killing of black youths in London Katie Stanton

5. Edwina Currie strikes again: Young people must ‘learn sense’ Katie Stanton


 

• There was some rare, positive news on the eurozone crisis at the end of the week, with agreement on a bank bailout, throwing a lifeline to Spain and Italy – allies in midweek but opponents tonight in the European Championship Final.

European Union leaders agreed to use the eurozone’s planned bailout fund to directly support struggling banks, without adding to government debt, also agreeing to set up a joint banking supervisory body for the eurozone. Spain and Italy look to have secured advantageous terms on bank recapitalisation and financial oversight, while France and Germany appear to have moved closer.

The breakthrough was welcomed by David Cameron, who, on his return from the Brussels summit, ruled out an immediate referendum on Europe in today’s Sunday Telegraph, though said he was prepared to consider one – a stance described by Labour as showing “weakness”, and one certain to concern his Lib Dem coalition partners.

For more on the eurozone story – in particular the Spanish banking crisis – see our report here.

• History was made in Northern Ireland this week with the Queen and Martin McGuinness shaking hands.

Unthinkable. Unimaginable. Unbelievable.

The Belfast Telegraph summed it up best, reflecting the thoughts of a mother whose son was murdered three years ago:

“Geraldine Ferguson believes the handshake is a signal of commitment to the cause of peace, a cause that her 21-year-old son, [Sapper Patrick Azimkar], died for.

“She hopes, as do we all, that Northern Ireland is firmly set on the road to a lasting and just peace. For she, like us, knows only too well the unacceptable human cost of hatred and division.

“But she also recognises that the death of her son along with another young soldier was widely condemned by all sections of the community here and there was a tremendous outpouring of sympathy for the bereaved families.

“Healing the wounds of the past is a slow process, but Her Majesty has played an important part in it.”

For more on the historic, momentous event – including the thoughts of Mr McGuinness – see the Week Outside Westminster below and read our reports here and here.

Progressive of the week:

Shadow business secretary Chuka Umunna, who this week delivered a speech in Westminster on “Entrepreneurship and Social Mobility”, in which he urged young gang members to use their skills for good, saying:

“What frustrates me is this: many of these young people are using skills that – if channelled in the right way – could provide them with an alternative route to success. And yet, in Lambeth, too much of this entrepreneurial instinct is being channelled into totally the wrong thing. Just imagine what our young gang members could achieve if their energies were redirected.

“Their entrepreneurial zeal, used in a legitimate business setting, could provide them with a ladder up, just as it did for my father. Instead, as things stand, many of them will likely end up in jail with blood on their hands unless we change things.”

Inspirational, forward-thinking stuff. See our report here for more.

Regressive of the week:

Edwina Currie, reprising her role as tormenter-in-chief of the poor, the unemployed, the young. On the day the Tories revealed major cuts to housing benefit for under-25s, she spouted her bilious thoughts on the affair, implying of that age group that none of them work, vote, or have any sense.

See here for more.

Evidence of the week:

Give us our Ball Back: Reclaiming Sport for the Common Good” (pdf), by Theos and the Sports Think Tank, launched in Parliament this week. The report, released a month before the Games, argues politicians’ assertions about how far sport can deliver on health, values and morality, economic benefits and, even peace are misleading, and are ruining the fun of it.

For more on the Olympics, now within touching distance, read our reports here and here.

The Week Outside Westminster by Ed Jacobs:

Northern Ireland

History was made with the handshake between the Queen and Martin McGuinness, with widespread praise for both of them for having taken the peace process to a new level.

On the morning of the momentous event, an editorial in the Belfast Telegraph concluded:

“Healing the wounds of the past is a slow process, but Her Majesty has played an important part in it.

“Again yesterday she rewrote history by entering a Catholic church here for the first time. Perhaps a small step, but symbolically a very important one, a recognition that her subjects here – whether they accept the title or not – cover a range of political and religious beliefs which she respects.

“Today she and Martin McGuinness will make another symbolically important gesture and both deserve respect for that.”

Meanwhile, it emerged the Stormont Executive used its June Monitoring round to reallocate £128 million of government funds to invest in transport schemes, school building repairs and youth employment schemes.

Scotland

Former chancellor Alistair Darling this week formally launched the campaign to keep Scotland within the union.

In declaring Scotland now has an “irrevocable” and historic decision to make, he continued:

“The truth is we can have the best of both worlds: a strong Scottish Parliament and a key role in a strong and secure United Kingdom. This is about what unites us, not what divides us.”

Writing at the New Statesman, George Eaton said of the launch:

“The title of the ‘no’ to Scottish independence campaign – Better Together – is indicative of the group’s determination to make a positive case for the Union, rather than merely a negative case against secession.

“Alistair Darling, who launched the campaign in Edinburgh, rightly rejects the argument an independent Scotland would be economically unviable. Rather, he pointed out both Scotland and England have more to lose than to gain from a break-up.”

Elsewhere, the Scottish government announced £105 million of spending for capital investment in an effort to boost the Scottish economy. Finance secretary John Swinney said it was designed to “support economic recovery and deliver high-quality, efficient public services”.

Wales

Amidst reports Whitehall is considering the introduction of regional benefit payments, there was great concern at the proposals across Wales.

Pledging to fight any moves to introduce such a policy, a spokesman for the Welsh government argued:

“There appears to be a great deal of confusion surrounding the prime minister’s proposal. However, should any attempt be made to introduce regional rates of benefits, we will resist such a move.

“Wales will be hit disproportionately compared to many other parts of the UK by the welfare reforms already proposed by the UK government. Any attempt to introduce regional benefits will just make matters worse.”

Finally this week, a report by the Assembly’s Environment and Sustainability Committee called for measures to ensure Wales can maximise the opportunities the energy sector presents to boost Welsh economic recovery. Somewhat controversially, however, the committee backed the principle of nuclear as part of the future energy mix.

The World Outside Westminster by Tom Rouse:

The Fast and Furious scandal continues to dominate US politics.

A vote on whether Attorney General Eric Holder has been in contempt of Congress is likely to pass, with Democrats struggling to muster opposition.

It is the first time a sitting AG has been held in contempt and the scandal is an unnecessary distraction to the White House, as it chose to side with Holder by exercising executive privilege to prevent the release of documents relating to the sale of arms to Mexican drug lords.

***

The Patient Protection and Affordable Care Act – informally known as Obamacare – was upheld in a landmark decision by the Supreme Court on Thursday.

The judgement allows the continuation of health reforms that will require all citizens to have health insurance. Currently, 50 million Americans are without health insurance and if this continues under the new rules, those people will be forced to pay a penalty (except in cases of financial hardship or religious beliefs). Forcing healthier people into the insurance market will drive down premiums for everyone.

For more on the political implications of the Obamacare judgement for the President, Mitt Romney and the country, read our report here.

***

These ongoing problems appear to have had a noticeable impact on Obama’s poll ratings.

His approval figures have slipped back into negative territory according to the latest Gallup polling; however, the President will take heart from data released on Wednesday which suggests he is performing more strongly in swing states than his national averages suggest.

These figures will worry Romney, who is reliant on securing the majority of these swing states, particularly Florida and Ohio, if he is to unseat Obama.

***

Mohammed Morsi has been named Egypt’s first elected president, having narrowly beaten Ahmed Shafiq by 4 points.

His win sparked jubilant scenes in Tahrir Square, but also international fears about what impact an Islamist President will have on the stability of the region. To attempt to calm such fears, Morsi, one of the figureheads of the Muslim Brotherhood, announced he would be appointing two vice-presidents, one Christian and one female, to show his regime would not be adopting a fundamentalist stance.

Mursi also faces the challenge of winning over the 12 million voters who chose to support Shafiq, Hosni Mubarak’s last choice as prime minister. To do so, he is expected to distance himself from his Muslim Brotherhood background and present himself as a consensual President who can offer something to all Egyptians.

His relationship with the military will also be crucial. Following the dissolution of parliament, the military council granted themselves legislative powers and Mursi must be seen to be urging them to restore an elected legislature.

For more analysis on the impact of Morsi’s win, read our reports here and here.

***

And finally this week, to Paraguay, which has become the latest Latin American nation to find its government in disarray.

Sitting Preisdent Fernando Lugo was this week impeached by parliament and removed from office. Lugo, a former Catholic Bishop, was found guilty of corruption and on a number of other charges, including failing to properly consult Congress over an international treaty.

The ousted Lugo has urged the international community not to recognise Paraguay’s new government and has called on them to punish the new regime:

“The democratic process in this country is broken, I hope international organisations will have the maturity and the courage to say that there has been a break in the democratic process and that it merits a sanction.”

 


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