Britain stands on the precipice tonight, its European future in severe doubt for the first time since joining the Common Market, reports Shamik Das.
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• Britain stands on the precipice tonight, its European future in severe doubt for the first time since joining the Common Market.
In the early hours of this morning, David Cameron vetoed a deal to save the eurozone, a deal backed by all 26 other heads of government. Cameron had gambled on Europe’s leaders granting him further concessions, but his bluff was called by French President Nicolas Sarkozy and German Chancellor Angela Merkel.
He gambled and lost, out-thought, outmanoeuvred and out of the picture.
And the reason why he didn’t sign? To protect the City fat cats who bankroll the Tory party, to protect the financial services industry from further regulation, standing shoulder-to-shoulder with the one per cent who got us into this mess. Forget all talk about standing up for Britain’s interests, this was all about defending Cameron’s interests.
As I wrote earlier today:
“Tory dependence on the City doubled from when Cameron became Tory leader to when he became prime minister, the amount of money the Tories received from City money more than quadrupling.
“More recently, the GMB revealed 37 Tory donors with a combined fortune of more than £10 billion – linked to finance, hedge funds, private equity, property and other City activities – donated 60 per cent of the Tories’ funding in the last quarter…
“Is it any wonder then that Cameron refused to sign up to the deal, refused point blank to even countenance any scaling back of the City’s power? Who runs the government? Who’s pulling the strings? Whose money influences Tory policy? Even if he wanted to do the right thing, the gun to his head from the Tories’ biggest donors meant he couldn’t.
“On the wider political point, if Cameron believes he has sated the Eurosceptics with this ‘non!’, he can think again.
“He appears as in hoc to them – and after all, it is only with their support he became Tory leader (see here and here for the details) – as the City. And, just like a predator who scents blood, they will demand more, and more, and more, more renegotiation, more withdrawal, more grandstanding which their increasingly weak leader will be powerless to resist.”
Not even under Thatcher did the future look so bleak – and this from a coalition comprising the supposedly pro-European Liberal Democrats, whose leader has lavished praise on the prime minister today, praise echoed by his predecessor Sir Menzies Campbell. Only Vince Cable and a handful of Lib Dem MEPs (take a bow Sharon Bowles and Chris Davies) have the balls to stand up to the Tories.
As Alex Hern wrote today, if Nick Clegg wasn’t even prepared to make a stand on this, what is he prepared to speak up on?
“The question on the lips of Liberal Democrats today must be: Are there any areas on which Nick Clegg will not compromise? The common view of the Lib Dems before the election was as the party of students, civil liberties and Europe. The betrayal on the first of those three is legendary. The Lib Dems went from a manifesto committment (pdf) to “scrap unfair university tuition fees” (p33) to voting for a near tripling of those fees.
“The party hasn’t been much better on civil liberties. Their commitment to end child detention has become a commitment to end some types of child detention. They have supervised a creeping militarisation of the police, been silent on the use of kettling during peaceful protest, and voted for removing the right to see a solicitor for free after arrest.”
Ann Pettifor, meanwhile, looked at the policy implications for the financial crisis, concluding the summit is “futile” anyway, since we’re in the midst of a global, not merely eurozone, crisis – but it’s the response of the rest of Europe that should worry us most; the view across the Channel risks becoming one of “we’re better off without you anyway, we don’t care if you leave, make our day!”
The decisions taken by the euro 17 and the EU 26 will affect us, they will impact on our economy, on our lives, on our future – yet from now on it seems we will have a diminishing say on the big calls, and the more Eurosceptic our approach becomes, the more Britain withdraws into the shadows, the less of a say we will have.
The xenophobes, Little Englanders and isolationists should be careful what they wish for.
• Earlier this week, it was Cameron’s chancellor who came under attack, over the economy, and his inability to change course from his failed policies.
Writing on Left Foot Forward, shadow minister William Bain described George Osborne as “the downgraded chancellor of a deflationary government”:
“The huge error made by the chancellor on assuming office last year was to mistake a crisis of global demand, growth, and jobs being for one purely of deficit and debt. Driven by the theory that the public sector was always inefficient and public and private sector growth mutually exclusive, he launched on a grand experiment of so-called expansionary fiscal contraction.
“He must now admit that it has been the most disastrous misuse of fiscal policy in Britain since the 1930s…
“He has reduced an economy recovering at an annualised rate of 2.1 per cent a year at the end of the previous government’s period in office, to flatlining growth, which this autumn stands as the fifth lowest in the EU according to the European Commission, and lower than the eurozone average. The National Institute for Economic and Social Research (NIESR) have said this is the slowest recovery from recession in Britain in a century.
“In the Great Recession of the 1930s it took 48 months to rebuild the lost output in the economy, under this Chancellor it will be 69 months and counting…
“The country is crying out for a fairer alternative policy to this failed Tory plan that is sucking demand from our economy and hope and life from our communities. It deserves better leadership and a more optimistic vision of our country’s future.”
While Ed Balls, in a direct attack on Osborne in the Commons on Tuesday, told the House:
“In this chancellor’s Panglossian world, everything is working out just fine, Mr Deputy Speaker, but in the real world, in the real world, with the world economy darkening, with the UK now forecast to endure stagnant growth and rising unemployment this year, next year and the year after, this Panglossian chancellor is making a catastrophic error of judgement, refusing to learn the lessons of history, refusing to even understand the lessons of economics, refusing to shift to a more balanced plan, he got it wrong 18 months ago, he is getting it so, so badly wrong today, out of his depth, out of touch, isn’t it time he changed course before it is too late.”
“…has been slowing since May but this slowdown has accelerated in the autumn. This is being driven by the double whammy of falling business and consumer confidence.”
With the chief executive of the Recruitment & Employment Confederation, Kevin Green, saying:
“The government has done as much as it can in the short term to remove restrictions to employment and stimulate demand. However, if confidence doesn’t return quickly to get the jobs market moving again, the government may need to take more radical action in the New Year.”
As Tony Dolphin wrote in his monthly economic update:
“The UK economy is now teetering on the brink of recession. The Office for Budget Responsibility forecasts real GDP growth of just 0.9 per cent in 2011, followed by 0.7 per cent in 2012. But in the two quarters between the third quarter of 2011 and the first of 2012 it expects no growth at all…
“More recently, the crisis in the eurozone will have affected confidence in the UK, though exports are performing better than domestic demand. Cuts in public spending and employment have also taken demand out of the economy…
“The chancellor is sticking stubbornly to his ‘Plan A’ for deficit reduction because, he argues, to not do so would risk the confidence of bond markets, and it is a fact that bond yields in the UK are close to record lows.
“It is, however, debateable whether that is due to the chancellor’s fiscal policy or to the deteriorating outlook for growth, the recent increase in the scale of quantitative easing and the vanishing likelihood of an increase in interest rates in the foreseeable future.
“Certainly, the price to pay for low bond yields appears to be almost every other economic indicator turning red.”
Also this week on the economy, watch Ed Miliband’s PMQs clash with David Cameron, and read about the SNP’s policies on infrastructure investment; Unite’s strategy to help save British manufacturing; a rebuttal of the latest Tory claims that only “the North Korea worker’s party” is in sync with Labour’s policies: and Cormac Hollingsworth on Ed Balls’s latest remarks.
• The scandal of secretive, sleazy lobbyists reared its ugly head again at the start of the week, following The Independent’s sting on the kings of anti-transparency Bell Pottinger.
“This is reminiscent of the old Tory days of sleaze. A Conservative government at the heart of yet another lobbying scandal. Last month’s led to the resignation of the defence secretary. This one leads to the prime minister himself. One of the lobbyists caught by today’s investigation by the Independent / Bureau of Investigative Journalism, Tim Collins, is the chief lobbyist at Bell Pottinger Public Affairs.
“He is caught on camera boasting of his contacts:
“I was in the Conservative research department with David Cameron and George Osborne… I was in the Shadow Cabinet under two or three leaders, again with David Cameron and George Osborne…
“I’ve been working with people like Steve Hilton, David Cameron, George Osborne, for 20 years-plus. Edward Llewellyn, who’s the prime minister’s chief of staff, was my deputy in Central Office for a long time. Steve Hilton was my deputy in a different capacity.
“I know all these people. There is not a problem in getting the messages through to them.”
“In a speech before last year’s election, David Cameron attacked “secret corporate lobbying”; in government, Cameron’s hostility to lobbyists appears to have evaporated, along with his commitment to “shine the light of transparency on lobbying in our country”…
“It’s time his government ignored the private protests of the influence industry – whether Conservative peers, former colleagues, friends, neighbours, or wives – and listened to public demands for transparency. The longer he delays the greater the smell.”
“The question is this: are the claims of Tim Collins, among others, that he has access to Cameron, Osborne and Hague and their closest advisers, true or untrue? If they are true, some pretty stringent action is needed. If untrue, then the lobbyists are charlatans and all those Tory MPs who used to be lobbyists and those lobbyists who used to be MPs are conning clients out of large sums of cash.
“I agree with the prime minister that lobbying could be the next big scandal to hit British politics. But he seems to have changed his mind about the need to do anything about it…
“We all have the right to lobby and it is a vital part of democracy. But big business can pay for professionals who know their way around parliament and who can get the sort of access not available to the rest of us. They should not have the capacity to trample on the interests of ordinary citizens simply because they have cash – and went to the right school.”
And Jonny Mulligan, head of corporate, issues and environment at Unity, put the case that there are decent lobbyists out there, who, unlike the likes of Bell Pottinger, have nothing to fear from greater transparency:
“Silly, sordid, sleazy and sad is the real reaction to the Bell Pottinger lobby story. Two senior executives caught by their own hubris over-claiming, under-delivering and damaging a whole industry in the process. If proven correct these allegations throw up serious questions of ethics and standards which must be addressed.
“If proven true they make filth of the word ‘lobbying‘ and present the public with a picture of an industry filled with charlatans and snake oil salesmen…
“The time has come for change. The time has come to get all agencies to give full and recorded disclosure around their political links and work. It is the only way the public and clients will know who they are dealing with and their history. If a company wants to work for big oil, despotic regimes and cover-up child labour that is their choice. Just get it on the record so everyone knows…
“This fiasco is not good for communications agencies and has placed the industry in the media’s firing line for all the wrong reasons.”
Also on the lobbying scandal, read Alex Hern on the anger of Wikipedia founder Jimmy Wales at Bell Pottinger’s reprehensible actions and their attempt to smear Gordon Brown’s sister-in-law, and from the archive, check out our report on Peter Bingle, chair of Bell Pottinger, who said “the public has no right to know who our clients are”.
Progressive of the week:
Legendary leftie Tony Benn, a man who needs no introduction. Appearing before the House of Commons Political and Constitutional Reform Committee yesterday, the inventor not only called for Cabinet proceedings to be FoI-able, he also suggested a novel idea for a post-Monarchy Head of State – making the Speaker of the Commons President of Britain.
You can see more on this revolutionary idea here.
Regressive of the week:
Tory MP for Mid Bedfordshire Nadine Dorries, who on Wednesday’s Newsnight was embarrassingly poor in putting forward the ranty, illogical, anti-European ‘no surrender’ case. (Is it any wonder that David Cameron, adopting the same approach, failed to agree a deal at the summit this morning…?!)
Former foreign secretary Sir Malcolm Rifkind, with whom she was debating, even went so far as to tell her there was a “fundamental gap with the real world” and her, adding:
“The reality is that no one country, whether it’s the United Kingdom or any other country, can simply dictate to all the rest, even the Germans can’t do that, they have to get agreement from their allies.
“So the idea that David Cameron goes to a summit and says ‘I am going to veto this summit, this agreement of everybody else we should go forward on, regardless of the implications for the European economy, regardless of the reactions of the markets, including our interest rates, as well as those in other countries unless you give me concessions on matters which are not relevant to this immediate European crisis’…
“You’ve got to be negotiating in a sensible, practical way, not just saying I demand this, I demand that, regardless of the consequences. That’s not the real world we live in.”
You can watch a full video of the exchange on Left Foot Forward here.
Evidence of the week:
The British Social Attitudes Survey 2011. On Left Foot Forward this week, we’ve had a number of reports on the findings of the survey: Declan Gaffney on child poverty, Duncan Exley on inequality, Matthew Butcher on the future of pensions, and Ann Summers on the headline findings.
The report itself can be downloaded here.
The World Outside Westminster by The Grapevine’s Chris Tarquini:
With all the concern surrounding Egypt and Libya it is easy to be pessimistic about the future of the two nations, however in the former at least a degree of stability was introduced this week with the swearing in of Egypt’s new cabinet.
Despite a government being put in place the new interior minister is Cairo’s ex-police chief Muhammad Ibrahim Yusuf and the ruling army council still has control of military affairs, leaving some observers to question how much of a step forward this really is.
Staying in Africa, a South African fast food chain has withdrawn an advert mocking Zimbabwean leader Robert Mugabe as ‘the last dictator standing’. Nando’s South Africa featured mocking portrayals of Mugabe alongside former infamous dictators including the likes of Idi Amin, Muammar Gaddafi and Saddam Hussein.
In mocking Mugabe as lonely (following the deaths of many of his former bloodthirsty international allies) the firm provoked angry condemnation from pro-Mugabe groups including threats to members of staff that caused the advert to be eventually pulled.
One dictator still in charge of his country is Syrian President Bashar al-Assad, who is under pressure from a whole range of nations including the United States and those in the Arab League.
In a bizarre interview with ABC News’s Barbara Walters, Assad displayed a degree of historical arrogance when stating:
“No government in the world kills its own people unless it is led by a crazy person.”
The President, who has overseen a brutal crackdown on pro-democracy protesters, also questioned the credibility of the United Nations, responding to Walters’s statement he has an Ambassador to the organisation with the comment “it’s a game you play”.
Whether Assad will be playing games or starring in a Nando’s advert this time next year remains to be seen.
Closer to home former President of the Soviet Union Mikhail Gorbachev has added his voice to concerns over the recent Russian parliamentary elections by stating:
“The country’s leaders must admit there were numerous falsification and rigging and the results do not reflect people’s will.”
The crackdown on protesters and heavily biased state TV coverage have provoked more concerns about the increasingly authoritarian nature of Vladimir Putin’s regime before next year’s Presidential election. Despite a large drop in support for Putin’s political party United Russia he is still expected to win comfortably.
How far some will go to guarantee that victory is concerning many pro-democracy and human-rights advocates.
To the States, and outspoken former Governor Rod Blagojevich (Democrat, Illinois) has received a 14-year prison sentence for corruption after trying to sell the Senate seat formerly held by President Obama. Despite a poor track record amongst Governors of the state regarding the rule of law, many feel ‘Blago’ has been given a particularly tough sentence.
Blagojevich served in office until 2009 but will be serving a much longer term from now on and he need not worry about approval ratings.
In the RealClearPolitics poll of polls current Republican flavour of the week and former Speaker of the House Newt Gingrich still commands leads in three of the four early voting primary states – Iowa, South Caroline and Florida – with Mitt Romney ahead in New Hampshire, where Ginrgich is second.
Senior Romney aides are reported to be growing nervous at the prospect of a Gingrich dominated early primary season, which at the least would drastically prolong the process. Whether the ‘Newt 2012’ campaign can survive reminders of his past infidelities, scandals and lobbying as well as his often bombastic language remains to be seen.
This is all good news for President Obama, who, despite having a 41%/51% approval and disapproval rating, will be thinking Christmas has come early if the volatile Gingrich stays this far ahead of the supposedly more electable Romney.
Ed Jacobs’s Week Outside Westminster:
After weeks of wrangling and negotiations, the Welsh government finally saw its budget for next year passed thanks to the support of Liberal Democrat Assembly Members following a deal over school funding.
Assessing the politics of the situation, BBC Wales Welsh Affairs Editor, Vaughan Roderick, explained:
“From the point of view of Labour and the Liberal Democrats, nothing is more important than next May’s elections. The reasons for that is simply this: the Liberal Democrats are incredibly dependant on their local government base.
“If they lose a lot of council seats, the Welsh Lib Dems will be in deep trouble for the long term so Labour are going to do nothing to try and help Lib Dems try to save seats; the Lib Dems, on the other hand, the reason they wanted this deal is because it puts distance between them and the coalition in London.
“Having had to make a deal over the budget, Labour wants to do no more favours for the Liberal Democrats.”
First minister Carwyn Jones, meanwhile, was in a feisty mood.
Having warned it was not the time to be renegotiating the terms of the UK’s membership of the EU, Whitehall accused him of being “confrontational” as he expressed concerns the Welsh government still had not received details of how it would be affected by the autumn statement.
Outlining his concerns, the Jones said:
“The chancellor’s statement last week confirmed our deepest worries on the UK government’s approach to the economy – growth has stalled and families across Wales are being financially squeezed. It has now been eight days since the chancellor revealed his autumn statement and we are no clearer on how his plans will affect the Welsh government’s budget.”
The SNP appeared to have been bolstered by polling within the annual Scottish Social Attitudes survey showing 32% of Scots are now in favour of independence, up from 23 % last year. The poll also found support for all decisions being made in Scotland has increased by 15 points to 43%, while 29% support everything apart from defence and foreign affairs being devolved.
Whilst ministers were quick to argue it showed the public were on their side, Professor John Curtice of Strathclyde University warned the nationalists:
“The appetite for a more powerful parliament, including independence, has grown in the last 12 months. However, support for independence is still no higher than it has been on previous occasions since the advent of devolution.
“If the SNP are to persuade a majority of Scots to back independence they will need to convince them of the economic case for leaving the union – and that is a debate that is still to be won or lost.”
“Now recognition of the vital importance of infrastructure is long overdue. That is why a clutch of business organisations yesterday – including CBI Scotland, the Scottish Building Federation, Scottish Chambers of Commerce and the Scottish Council for Development and Industry – all gave this announcement a broad welcome.
“Given the bleak forecasts for the economy and the near certainty of further rises in unemployment, the move of capital spending programmes to the centre of the Holyrood administration’s purpose and mission cannot come soon enough.
“However, on financial practicality, this programme founders. It is not so much realistic finance as dreamland economics. It rests on heroic assumptions that the SNP administration will secure maximum borrowing powers; that private-sector finance will cascade in and that other funding will be found from within the Holyrood budget.
“It also assumes a political commitment to these projects stretching at least 15 years ahead, covering the independence referendum and beyond. Even assuming such ambitious borrowing can be raised, the cost of that finance is not mentioned once.”
On Left Foot Forward this week, Kevin Meagher reported on the decision by the family of murdered Belfast solicitor Patrick Finucane to launch legal proceedings against David Cameron’s refusal to establish a full independent judicial inquiry into his killing.
Outlining the purpose of the action, Finucane’s widow, Geraldine, explained:
“Not for the first time have we had to resort to legal proceedings to vindicate our legal rights. It is clear that the British government have cynically reneged on the commitment made at Weston Park. The Cameron decision is also incompatible with Article 2 of the European Convention on Human Rights (the right to life).
“We take the view that the decision not to hold a public judicial inquiry is just another obstacle which we will have to overcome. We are determined to get to the truth surrounding my husband’s murder. Our campaign will continue.”
Stormont, meanwhile, debated a motion tabled by the SDLP criticising Whitehall’s planned reforms to public sector pensions.
Opening the debate, former party leader, Mark Durkan, argued:
“The importance of this issue to public service workers and users of public services manifested itself last week when thousands stood on picket lines and attended rallies across the North. Their message was loud and clear: it is not about self-preservation; it is about fairness and justice.
“Why should ordinary, hard-working people be penalised for the reckless actions of bankers? Public servants are being unfairly targeted in a bid to solve a financial crisis that was not of their making.
“Not only is it an attack by the coalition government on their pockets, which will result in, on average, £63 a month less in take-home pay, it is also an attack on their morale and can only adversely affect the delivery of services that already have to operate in an ever increasingly difficult financial context.”
This week’s most read:
1. The perversity of Dan Hannan and the “there are no cuts” brigade – Daniel Elton
4. Latest lobbying scandal leads right to Cameron’s door – Tamasin Cave, Alliance for Lobbying Transparency
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