Trading delusions

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They had something on the BBC the other night about the possible impact of brexit on trade, in particular on food prices and the UK food industry. Here’s a summary article from the BBC news website.

As I’ve mentioned before, one of the problems with the BBC, is that in the interest of “balance” and “fairness” they’ll have some expert on telling us what’s likely to happen, then they’ll turn to some swivel eyed right wing loon, to give the opposing view.

Two terms that keep cropping up with the brexiters are “new and exciting trade deals” and “push into new emerging markets”. Well first of all, why do you need a new trade deal with the other countries? Via the EU the UK already HAS a perfectly good set of trade deals. Brexit means the UK will have to spend several decades renegotiating those deals. The idea that a country of 60 million is going to get a better deal than a trading block of 400 million is clearly absurd.

Granted the TTIP trade deal between the EU and US looks like its dead, but to be honest that was kind of tainted to begin with. Its demise is probably a good thing. The danger now is that the UK will find itself forced to sign up to some version of that which blatantly favours the US, which could see the sell off of the NHS.

As for “new and emerging markets”, where exactly are these places? Have we found a new continent recently? I know we’ve been finding exoplanets recently, but its a bit early to be thinking of trade deals. Granted, as most brexiters seem to live in the 19th century to them “the orient” or “the south seas” might be a new and mysterious place, but we’ve been trading with these countries for years.

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Is this this what the brexiters mean by a new emerging market?

Given that the bulk of this TV programme seemed to be about food and beef, I can tell you, having been to Argentina and China in the last 12 months, they have a perfectly adequate supply of food and its very cheap. Indeed, that’s the problem, they don’t know the meaning of the word “small portions” in either country. There is no way the UK could undercut local prices. And given how much of the UK is owned by foreign multinationals, its not as if it will ever be a straight “us” versus “them”. It will be one UK based but Chinese owned firm, against an American owned firm in China.

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The new iconic London taxi….owned by a Chinese firm…who bought it off a Malaysian company

Indeed the danger is the other way around, that these countries with there lower production costs will flood the UK market with cheap produce and bankrupt UK industry. One of the things about trade deals is that if everyone wanted a perfectly free trade deal, then all you’d have to do is get both sides to sign a single piece of paper with “no tariffs” written on it. But nobody wants that because it would decimate their industry as the other side dumps goods at ultra-low costs (in some cases made at below the cost of production thanks to state subsidies). This is why the devil in any trade deal is in the detail. And inevitably the UK is going to struggle to get anything more favourable than the EU has managed to get.

Even competing against the US presents problems. Their farmers use all sorts of practices banned in the UK, growth hormones in cattle, feedlots, chlorinated chicken. Its enough to make you want to go veggie….until you realise how much of America’s cereal crop is of full of GMO’s. And US farmers receive very high levels of farm subsidies. Indeed, even US industry is heavily subsidised in some sectors (usually in the form of massive sweat heart deals to supply equipment to the military, FEMA or USACE), such as construction equipment, aircraft and vehicles, the very industries the UK is anxious to defend.

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Far from being the land of small government and free enterprise, the US is one of the most interventionist and protectionist regimes in the world

The idea of UK firms like JCB competing against titans like Caterpillar (America) or LiuGong (China), both with the backing of world superpower behind them is just laughable. And UK beef farmers with a few hundred acres competing against an Argentinian farm half the size of Wales, don’t think that’s going to work…particularly after anyone abroad google’s “British beef” and the first thing that comes up is “mad cow disease”.

The only way that UK firms could compete is by copying the same tactics. E.g. After these pro-brexit farmers go to the wall, the local laird (who helped bankroll the leave campaign) buys up their farms, rips up the hedges and country side and turns the entire county into one massive feedlot. Now if we are lucky he might hire a couple of destitute farmers on as farm hands. But then again, he might just sneak in some migrant workers instead. It depends who is suitably desperate for work.

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Election update

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As I mentioned before, its clear that labour is doing rather better than expected. However this isn’t so much because Corbyn is some sort of political genius, more because “chicken” May is screwing the campaign up. As the spectator (a Tory rag!) puts it “Theresa May has the warmth, wit and oratorical ability of a fridge-freezer”.

About the only thing she got right was the decision to the polls. Because if the Tories are struggling now, what chance do you think they stand after all the bad news from brexit hits and labour have a vaguely competent leader?

Childcare

There have been more than a few face palm moments from Corbyn, for example childcare. For anyone who doesn’t know, this is a major issue, one that could easily win labour lots of votes if they could come up with a coherent policy.

UK families spend on average £6,000 on child care per year, about £500 a month, more than some people spend on rent or mortgage payments. And that doesn’t buy you 40 hours a week of child care. No it gets you only 25-30 hours a week. Meaning a working couple will need to set up rota where one starts work late and the other finishes early and they take it in turns to take off Friday afternoon’s. Of course if you are a single parent, this means you simply can’t have a full time job. And if you can’t afford to spend 6k a year then that means one parent can’t work at all (or a single parent is forced onto benefits). So many in the UK are forced to choose between a child and a career as a result.

So if labour could propose something sensible here it would be a major vote winner…..but of course Corbyn being Corbyn he flunked it. I mean how can the Tories be losing to this guy? And Diane Abbot similarly fluffed her lines on policing earlier in the campaign. Then there was the issue of the debates. I don’t think Corbyn did terribly well in any of them, but at least he actually showed up, unlike chicken little May, the Turkey of Maidenhead.

Magic money trees

The Tories main go-to excuse now seems to be to try and paint labour as the party of tax and spent. However this betrays the reality that the Tories have run up a larger deficit in just the first 5 years than labour ran up over 13 years of Blair and Brown, despite all of the austerity measures taken (or perhaps because of those measures and the freeze it put on the economy).

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And brexit threatens to make the situation worse. Restrictions on trade with the EU, migrants (who pay taxes) leaving and labour shortages depressing growth will all lead to a drop in tax receipts. At the same time, rising inflation will push up the government’s costs. And of course they’ll need to pay various one off fees and costs to the EU or to set up agencies that basically replicate what the EU does, as well as the various unfunded promises they’ve made to various special interests, which all told will costs some figure in access of a hundred billion. Which kind of does put some of the promises labour have made in prospective. In short, the Tories also need a magic money tree, indeed they need a whole forest of them.

The Tories also talk about building loads of council homes, ignoring the fact that it was they who destroyed the UK’s system of council property in the first place. And if all the migrant builders leave, who exactly is going to build all these new homes? Do they have a 100,000 or so experienced builders? Oh no wait, they cut back on funding to programmes like that leading to major labour shortages.

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Pensions

It is perhaps inevitable that the Tories will have to cut public spending and do so on a large scale (I mean its not as if they are going to raise taxes!). And pensions are the one thing that has escaped the Tory axe so far. They’ve more or less admitted that the winter heating allowance will be means tested in future. However I suspect this is just the thin edge of the wedge.

It is, to be fair, a little silly to be dishing out benefits to pensioners without means testing, yet forcing the disabled or poor to undergo Daniel Blake style humiliation and hot coals to get the benefits they need. It is one or the other, either you don’t means test any benefits (hence why I favour a system of citizen’s income) or you means test everybody, pensioners included.

The fact is that the UK pension system is simply unaffordable post-brexit, cuts are now inevitable. When the current retirees were paying their taxes most of the benefits they now enjoy didn’t exist and life expectancy’s were such that it was assumed most of them would be dead by now. So the fact is they’ve not paid in sufficient taxes to fund their retirement. Those of us working can’t afford to make up the difference. The new labour plan to bring in lots of migrants to fund pensions was rejected, often by the very older generation who voted for brexit. Private pensions are similarly underfunded and likely to see a shortfall. So it seems clear to me that these cuts will probably be just the start of a rolling back of pension benefits, much as a warned would happen in the event of brexit.

Re-nationalisation

One potentially popular labour policy is the re-nationalisation of public services privatised by the Tories. Now this is something I would support. I would argue that the inherent problem with the UK’s privatised public services is that the system of privatisation set up by Thatcher (an ideology the Tories themselves have now essentially abandoned) was flawed from the start. They allowed the spiv’s and speculators in the city to write the rules of privatisation, who inevitably came up with something that only benefits them and not those who use the public services. Hence why the costs of services such as the railways, electricity and water charges have all soared, as has the cost to the UK taxpayer to subsidise these industries, which is now higher than it was when said services were publicly owned.

But the devil is in the detail. I would sell re-nationalisation as a temporary measure to correct the inherent flaws in the Thatcher era system of privatisation. Indeed, the irony is that many of the UK’s rail firms are owned by foreign state owned rail companies (we’ve essentially outsourced running the railways to other countries because its against the Tory’s religion to nationalise them ourselves). I would primarily focus on forcing the privatised public services to follow through on what their franchise contracts require them to do and then try forcing them to give up those contracts (or allow a partial government buy out) if they are unable to comply (my guess is most of the failing ones will just give up and walk away rather than risk losing more money). And I won’t worry too much about privatised services that are actually well run, focusing on those that need to be fixed (e.g. southern rail). Keep in mind that labour will almost certainly be dependant on other parties, so any plan without cross party support is doomed to failure.

However, Corbyn’s plans here are largely uncosted and clearly ideologically driven. Hence they would likely be rejected by the other parties and he’d have to fight lots of messy court cases to force the franchise owners out and then pay them compensation. In short, its probably not going to work, even under ideal circumstances. And this is unfortunately a common thread throughout the labour manifesto.

Now like I said, there Tories have lots of things that are uncosted too and they aren’t being straight about the cuts they are going to have to implement. But labour that doesn’t give labour the excuse to just make stuff up.

Goodbye Mr Fox

And one issue that isn’t being raised is Fox hunting. While the bulk of the country is opposed to fox hunting and feels the matter was settled, the Tories, being a party of toff’s have never forgotten about the issue and its likely they’ll be trying to re-introduce it all over again. This is the danger with a Tory win, they will be resurrecting lots of long dead political issues and trying to score idealogical points while the country falls apart all around them.

Trump

And Trump will be coming over in July (well unless Corbyn wins and tells him to get lost). Theresa May is clearly in his pocket. While leaders around the world lined up to condemn Trump’s decision to pull out of the Paris accords, May was silent. When he say fit to attack the London major in the middle of a terrorist attack, again barely a peep from Downing street.

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So a vote for the Tories is a vote for the UK becoming the 51st state of Trump. The UK will be surrendering its sovereignty to the US, as well as accepting US trade standards, including milk and beef loaded with steroids and chlorinated chicken.

Terror attacks and policing

And speaking of terror, its ironic how the Tories try to portray themselves as the party of security and stability. The fact is that policing in the UK is chronically underfunded and they are squarely to blame for this, as there are 20,000 less police officers now than there were when they took over. Policing is now so bad in the UK than certain crimes (such as burglary and petty theft) have undergone defacto legalisation, simply because there’s not enough cops to enforce them. And recall that May’s previous job as home secretary means these cuts happened on her watch.

Its all well and good the Tories mumbling about how they are going to respond to the recent attacks by arresting certain people or tighten this law or that, but one has to ask A) who is actually going to arrest these people and with the prison service over stretched where were you planning to detain them? B) if there’s actual evidence of wrong doing on their part why in blue blazes weren’t they arrested months ago? And C) if there’s no actual evidence, they your talking about internment, which they tried on the IRA back in the 70’s and that didn’t exactly work out did it?

I think its also important to acknowledge the factors driving terrorism. Namely the UK is helping prop up various corrupt and despotic regimes in the middle east, who use anti-western jihadi rhetoric as a conduit to deflect anger away from them. The UK (and the US) are also in the process of stealing middle east oil as well as supporting Israel’s occupation of the West bank. So here’s a crazy thought, but how about we don’t sell these regimes weapons any more, we move away from oil toward renewables, we kick the oil sheik’s out of London, freeze their accounts force them to go home and fix their country’s problems.

Certainly though more police and reversing the Tory cuts would help, for many reasons unrelated to the recent terror attacks. But I fear many will vote Tory now as the party that will keep them safee, when instead your voting for a party who’ve kicked a hornet’s nest and plan to keep kicking it, because hornets are well known to calm down if you keep annoying them.

An ideological election

All in all this is the sort of election where you can’t really rely on the manifestos. I seriously doubt whoever wins will stick to what’s in the manifestos. Indeed, its the things not in the manifesto’s, the unpopular decisions they’ll have to make that should really be deciding this election.

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 This is very much an election about ideologies. Indeed this is probably the reason the Tories have taken a dip in the polls. They don’t really have an ideology anymore, they’re basically UKIP-lite.

Unfortunately there’s just enough dump and racist people in the country, or those turned off by labours move to the hard left, that the Tories will probably win anyway for all of the wrong reasons.

Blogging catchup

I’m just back from a trip overseas on business, so I thought it would be a good idea to catchup.

Trump pulls out of Paris climate treaty

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It was perhaps inevitable that Trump would pull out of the Paris climate treaty. He’s rowed back on nearly all of his campaign promises, as inevitably many of these policies were just unworkable or unenforceable. The Paris treaty was one of the few things he could actually change, largely because it will take until nearly the end of his presidency to complete the withdrawal (meaning a few months later his successor might well opt to simply re-enter the agreement).

However it has to be said the main loser is going to be the US. There’s a serious case of deja vu here. When G. W. Bush dropped out of the Kyoto protocol, making the same lame arguments about “jobs” and “growth” the end result was that many of the technical experts in fields such as electric cars, fuel cell research and solar panels all went abroad, mostly to Europe and China and helped investors there found companies that are now worth tens of billions of dollars and employ many tens of thousands of people. And inevitably they then exported this technology back to the US. In other words thanks to Bush America ended up having to buy its own technology back off the Chinese and Europeans. Hardly putting “America first” was it!

History will now repeat itself. If Elon Musk gets into trouble and has to start letting staff go, no doubt they’ll just head overseas and get jobs in Chinese or European renewable multinationals. He himself might well get bought out by some Chinese investors who move production overseas. So how exactly are Trump’s actions going to create jobs?….well aside from more jobs in China anyway!

Furthermore, the US hasn’t really got a choice in the matter. Fossil fuels are a finite resource. As I’ve discussed before, the shale gas boom is eventually going to run out of steam. And there’s already signs of a slow down. Climate change is a crisis that will hit the US hard. So regardless of what Republicans think the US will have to give up fossil fuels eventually. What most countries are opting to do is a slow gradual transition. This means that the positives of a renewables boom (i.e. more jobs, more stable energy prices) tends to cancel out the negatives (higher energy prices, the temporary disruption caused by installing renewables infrastructure). Germany is the poster child for this, but a similar policy is playing out in Denmark, Sweden, Ireland, Norway, Scotland and Portugal to name a few. And yes, in all of these countries the renewables boom has largely been a positive that has greatly benefited the economy.

However, trying to undertake a crash course in fossil fuels phase out, which Trump has now all but guaranteed America will have to carry out eventually, will likely to be very disruptive to the economy. In short there’s a hard way and an easy way and Trump just committed America to the hard way. The country will be forced some day to undergo a dramatic shift away from fossil fuels, likely when supply shortages, high prices and the damage caused by climate change starts to bite. And they’ll be also forced to import most of the technology to do so from abroad. So Trump has more or less signed America economic death warrant.

Leader of the free world

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Indeed, during Trump’s recent European tour it became rather obvious what level of damage he’s already inflicted on America’s reputation abroad. The fact is that Trump is probably one of the weakest president’s America has ever had. Allegations regard him and his families ties to Russia (and the Saudi’s) have crippled his administration. Plus its all well and good making campaign speeches about how much America pays for NATO. However, around the G7 table it will no doubt have been pointed out that most of America’s military spending is on things nothing to do with NATO (while countries like Germany and Poland spend almost their entire military budget on NATO related activities).

And then we have the issue of Trump’s silence over the Portland murders of two men who came to the defence of a Muslim woman being abused by a Trump supporter. It would have been very easy for him to condemn this, but he did not do so until a good week after. And even then the announcement came from the official US government account, not his own twiter account. This could not be a clearer signal that Trump isn’t just saying racist stuff to curry favour with the KKK brigade, but he is actually a racist and a fascist himself.

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The resulting power vacuum means that someone else had to take up the mantle of leader of the free world. Given that May is leading the UK into self imposed exile (and economic suicide) that rules out the brit’s. So it now falls to Germany to lead the free world. This has both positives and negatives. On the positive side the Germans, even right wingers like Merkel, are considerably more sensible leaders than any recent American president. On the downside, Merkel is a bit risk adverse and not really the sort of person who is good at handling a crisis (as the situation in Greece proved). And the end consequence is a Europe and an EU that’s even more dominated by Germany than before.

Playing chicken

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I need to do a more detailed update of the election situation, but suffice to say the Tory lead is slipping. This was always the risk, elections are fickle affairs, even with the massive lead the Tories had in the polls at the start there’s always a danger events will turn against them. Its possible the polls are wrong and that labour support is being overestimated. But of course its equally possible that the labour lead is being underestimated. While the probability is that the Tories will still win, that doesn’t mean a Tory win is guaranteed (I’d say its an 75% chance of a Tory win, 20% chance of a hung parliament and a 5% chance of a labour win). And all it takes is one scandal, one leak of something the Tories don’t want to reveal in the next few days and the outcome of the election could change.

Of course the Tories must also acknowledge that they are doing badly not because Corybn is some sort of popular political genius in charge of a united party. He’s been unable to get basic facts right and most election literature I’ve seen from labour candidates avoids even mentioning him (by contrast the Tory, lib dem and SNP literature does mention Corbyn, so he’s an electoral asset….for the other parties!). So the reason why the Tories are doing badly in the polls is because they are making a pigs ear of an election that they should otherwise win easily.

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Take the recent election debates, where the wicked witch of Maidenhead Theresa May refused to show up. This was a major miscalculation. Granted, given the risk of her reverting to her true form, showing up to a debate with “people” was always going to be a bad idea. But not showing makes her look weak, arrogant and too chickshit scared to face Corbyn. How exactly is she proposing to deal with the EU if she’s too afraid to face off against some bearded hippy? So this decision could well backfire badly. Although given that the main winner of the debate were the Greens and lib dems, so its likely labour will lose support as well as a result of the debate.

The fact is that unless the Tories win by a significant majority this will be seen by her party as a political failure on her part and I’m guessing there will be a move against her. Then again, I’ve a suspicion that the real reason for the election is that the Tories are hiding something, quite possibly that May will be resigning soon for health reasons (or that she’s about to get caught up in some major scandal and forced to go). So that might well be the case anyway.

Living in a different era

One of the problems with Brexit and any Tory election victory is how it has puffed up the bigot brigade, who feel they can now throw their weight around. For example, we have a slum landlord type in England who is now refusing to let property to “coloured people. We have a jobseeker who was dismissed as a “left wing loon tree hugger (in an e-mail sent to her) and the number of racist incidents reported countrywide has doubled since the vote with 1 in 3 minorities now reporting some form of abuse.

One is forced to conclude this lot live in a different world and brexit has allowed them to start acting out their insane fantasies. However, this puts them at odds with reality, which does bode well for the country’s future.

Take northern Ireland, a key potential flash point for the brexit negotiations. Any changes to the status of the NI border will have profound knock on implications both in Northern Ireland and the South and thus effect the peace process. On the other hand a lack of a hard border makes a hard brexit an exercise in futility. Any migrant can simply get on a bus at Dublin airport and be in the UK within two hours. And as I’ve pointed out before, its goods not people that the UK needs to worry about. An open Irish border with different tariffs either side of it would be mercilessly exploited by smuggler gangs, undercutting the UK economy and probably bankrupting the economy in NI.

However whenever this issue is discussed in the media, scroll down to the comments and you’ll get lots of the brexit bigots referring to Ireland by the historic term “Eire” and voicing their deluded fantasies that not only is there no risk of a border poll (and Northern Ireland voting to leave the UK) but that Ireland might actually vote to re-join the UK. That’s how far out of touch this lot are.

For those who don’t understand the controversy, shortly after Ireland’s independence in the 1920’s the UK adopted a policy of referring to the Irish Republic as “Eire” as they felt that using the English word “Ireland” could be interpreted as support for a united Ireland and they didn’t like using the word “republic” as they were peeved at how we’d rejected rule by the crown. The British stuck to this policy rigidly to the point of absurdity. During the 1948 Olympics in London while all the other nations paraded under a banner with the name of the country in English, Ireland was forced to parade under the “Eire” banner, the only time in Olympic history a country has paraded under its native language.

Of course the irony here is that “Eire” is the Gaelic geographical name for the Island of Ireland. So actually by adopting this policy the UK was arguably voicing support for a united Ireland. This explains why in 1949, presumably after someone had lent them an English/Irish dictionary, the UK did an about face and took to referring to the Irish state as “the republic of Ireland” (or ROI for short). So when I say Brexiters live in a different era, I am not joking, they are literally sticking to a UK policy that dates prior to the 1940’s. That’s the sort of attitude you’re dealing with.

Downgrade of Chinese debt

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One story that seems to have been missed by many was the downgrading of China’s debts by the rating agency Moody’s, blaming concerns over China’s growing private debts. This is the first time the Chinese have suffered a downgrade since 1989. This provoked a furious response from Beijing. Although arguably this less than measured and diplomatic reaction did more harm than the actual downgrade itself.

On the one hand I’d say the Chinese have a point. Its all too obvious that the rating agencies are biased. I recall someone from the Brazilian finance ministry once bemoaning the fact that during the Workers Party era they’d pass a new policy on something completely unrelated to Brazil’s ability to service its debts (e.g. health care or employment law) and the rating agencies would hit them with a downgrade. Even though the UK or US government might well have down something very similar a few months earlier yet they didn’t get hit with a downgrade. Consider that the US has elected a president recently who boasted about reneging on America’s debts. If China is in such big trouble that its credit rating should be cut, then fairness would require that America’s (and the UK) should lose its A rating altogether.

That said, there’s no smoke without fire. Interbank lending and lending to local businesses as well as growing credit card and mortgage debts in China represents something of an unknown quantity in the country, with it unclear how much has been lent to who and how safe those loans are and what’s going to happen when those loans are defaulted on.

Now some will react with glee to the news China might get into trouble. Think again. Alot of the debt buying going on worldwide, both private and public debt, is being handled by China. So if China catches a cold the rest of might get Ebola. Any change in policy in China, e.g. they stop buying bonds or raise interest rates, would have a amplified knock effect in the west. Mortgage rates would soar, inflation would skyrocket. A devaluation of the RMB would suddenly make many Western goods uncompetitive and could push Western states into recession. While its often pointed out how much of America’s debt’s (both private and public) is owed to China (and thus Trump supporters seem to feel they can just up and renege on that), they forget that two thirds of it is owed to other Americans, mostly pension funds. So any American default of its foreign debts to China would likely bankrupt the entire US pension system overnight.

So this is something that should concern us all. Anyone urging the likes of Trump or May to play some sort of “great game” with China needs to realise what’s at stake – namely keeping your job and not living out your retirement in a dumpster! The trouble is, as recent events have shown above, there’s more than enough people in both the UK and US who will cut off their own nose to spite their face.

The biggest corruption scandal in history

And speaking of Brazil, operation car wash, the investigation that brought down the presidency of Dilma Rousseff, continues and its quickly growing into one of the biggest corruption scandals in world history. Its becoming clear also that crimes of Rouseff or her predecessor Lula were actually fairly minor and that the main reason why she was removed was more because she refused to try and slow down or halt the investigation. So her impeachment is looking more and more like a de-facto coup.

And the current president Temer and his party have their grubby little paw prints all over this scandal. Its clear that they have been on the take far more than Rouseff’s workers party. And since coming to power, we’ve seen key persecutors fired and replaced with political lackies of the president, judges dying in mysterious circumstances, witnesses disappearing, etc. To say this stinks is to put it mildly. There is a very real risk this crisis could bring down the entire Brazilian political system or possibly lead to a coup.

Ruinair

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Given past experience with British Airways I purposely didn’t fly with them this time and avoided Heathrow like the plague. So I wasn’t entirely surprised by the news that BA had all sorts of IT problems (not that their recent penny pinching cuts have anything to do with that!), nor with news of them leaving passengers in the lurch.

The fact is that the only difference between BA and Ryanair is that Ryanair are cheaper and generally on time. In a crisis BA will just fob you off and abandon you just as quickly as the budget airlines. So you may as well fly Ryanair or Easyjet and save yourself a few bob. And I am by no means alone. I know lots of business traveller who won’t get on a BA flight, even if their employer is paying for it. I welcome the day when BA collapses, much as Alitalia is currently going bankrupt.

Tories favour diesel farms over wind farms

Reblogging this from my energy blog….

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There are no sliver bullet solutions to the UK’s current energy problems. Wind power can certainly help, its led to big drops in the UK’s carbon footprint already, but only as part of a balanced energy diet within a grander overall energy strategy. However the Tories are hostile to wind power, preferring instead foreign owned nuclear and fracking, even thought neither is in a position to deliver any significant quantities of energy for some time to come.

This raises the risk of black outs if something isn’t done to plug the gap. So what is the Tory solution to this looming energy gap? Well instead of wind farms they favour diesel farms, clusters of diesel generators in fields up and down the country, subsidised by taxpayers I might add. If you ever want an illustration of everything that’s wrong with UK energy policy this is it, where to start with this one.

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Well for starters, diesel generators, while cheap to install are expensive to run. That’s why they are only ever used for generating electricity where there’s no other alternative (e.g. off grid power generation or backup generators). And with oil prices now on the way back up, those costs will start rising. They aren’t very efficient either. Yes a diesel engine in a car is more efficient than a petrol engine. But for power generation CCGT or IGCC plants have significantly greater efficiency. Potentially up to 55% efficient v’s at best 35% for diesel (and more typically 30% once the BoP is accounted for).

This also means that diesel generators are far more polluting, both in terms of carbon emissions and in terms of all the other gunk that comes out a fossil fuel plant. It beggars belief that someone can object to a wind turbine, yet look the other way to a bunch of these noisy beasts belching out carcinogenic fumes morning, noon and night. And again, if you are a UK resident, your paying for em. Carbon capture and storage is also a lot harder to implement with diesel farms than with the aforementioned gas cycle plants. So we lose that option too.

The irony is that I’ve long favoured the idea of distributed power generation, over centralised power stations. However, my preference is for CHP systems. They can run on a variety of fuels, including biomass or hydrogen (as a long term replacement for natural gas). And as we make use of the heat to meet winter heating demand (which represents a greater proportion of the UK’s energy demand than electricity remember), they are much more energy efficient, up to 85% efficiency is possible (so even running on fossil fuels, they’re 2.5 times better than diesel farms and nearly twice as efficient as a gas turbine plant).

So it would be all too easy to alter this policy slightly and achieve a similar result, just one that promotes renewable energy, cuts emissions, lower energy costs and helps keep homes warm in winter. So why is the government opting for diesel farms over CHP? Because CHP plant would be based in cities were the plebs live. You think home county toffs what money spent on keeping the great unwashed warm in winter! When instead they can earn a nice pot of cash putting a few diesels in some idle corner of their estate. Furthermore CHP might actually work (up to 40% of some European countries installed capacity is CHP), hence they’re will be no need for fracked gas or new nuclear plants. They are picking the worst possible energy option not despite it being so awful, but because it is so awful.

Any semblance of sensible energy policy has long been abandoned by the Tories. I think the UK’s post-brexit motto has to be go sell crazy some place else, we’re all stocked up here!

Globalisation and its discontents

A couple of years ago, if you were protesting against globalisation, you were assumed to be an anarchist or an eco-warrior. Nearly every major political party of right and left was signed up to the idea that globalisation was a good idea and that anyone who said otherwise was a wholly eared nutter.

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Globalisation has many opponents, anarchists, eco warriors, Trump, the far right….clowns, UKIP…..

However we now face the situation where the two major parties in the UK are essentially anti-globalisation (one hard left, the other authoritarian right). In America Trump is running on an anti-globalisation platform, while even Hilary has had to row back from her support of international trade agreements. What went wrong?

Firstly, I think it has to be acknowledged the benefits globalisation has brought. While I’d take the figures below from the world bank with a pinch of salt, it has to be said that globalisation has help lift millions out of poverty. It has helped push forward technological process, introduced us all to new ideas, its brought us multiculturalism, new and exotic tastes from far afield, and countries aren’t fighting world wars anymore (which is just as well given that we now have nuclear weapons). However it also must be said that experiences may vary. A rising tide has not lifted all ships.

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This can be illustrated by the next graph, the so called “Elephant Graph” which plots the relative change in income over the last twenty years, depending on whether you are among the world’s poorest or richest. If you a subsistence farmer in the developing world (i.e. the very poorest) you’ve probably seen no change at all. If your one of the 10% of the world’s richest, you’ve had it pretty good over the two last decades. The working class and middle classes in Asia and the developing world have seen the most dramatic improvements of all, going in many cases from poverty to complaining about first world problems. If you are middle class in the West, you’ve seen some benefit, but you’ve probably noticed that others have gotten a lot better off and keeping up with the Joneses is that little bit harder. However, the working class in the West have seen very little change, indeed some are even worse off. This essentially is the heart of the problem.

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And the problem, I would argue, is that somewhere along the way globalisation got bundled up, much like those toxic CDO’s that brought on the financial crisis, it got repacked with a lot of toxic neo-liberalism and outdated and rotting lassie-faire nonsense. It was then sold on as a complete package. Countries and electorates were told that they couldn’t have one without the other. That they must sacrifice their labour rights, wages, privatise public services and downside the state, all for the sake of globalisation. Now that everyone’s worked out that out that this globalisation CDO is filled with neo-liberal dog shit, people want to throw it away rather than simply unpick the good bits from the bad.

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Not least because often the very people who sold this toxic CDO were the very neo-liberal types who packaged it up in the first place (i.e. parties like the Tories or the GOP) and the very same who are catching blowback from the consequences. And they are obviously reluctant to admit their error or abandon their long held ideology. Also their lies have started to catch up with them.

For years the go-to lie of many right wingers was to blame foreigners, poor people and organisations like the EU for all the worlds ills. Your local water supply has been privatised? Not our fault (even thought it was in our parties manifesto and one of our donors is on the hook to get the contract), the EU made us do it (only because we got the very legislation passed by them so we could dodge the flak!). Can’t get a hospital bed? that’s not because we failed to fund the NHS to account for an ageing society, its the fault of them nasty evil hobbits foreigners comin over here and overloading local services. Your taxes too high? No, its not because of our failure to make the rich pay their taxes, its them scroungers living on benefits that’s the problem.

So when Corbyn tries to blame globalisation for causing brexit, I would argue that this is not entirely correct. It was this toxic neo-liberal agenda that along the way got mixed up with globalisation that’s the problem, plus the aforementioned lies of the right wing media. Like the boy who cried wolf, unwilling to admit to their error, they proceeded with the referendum. But the pleb’s, who they’d spent the last twenty years telling that everything was the fault of the EU and foreigners, actually voted leave. Confronted with the fact that actually you can’t keep the single market and end free movement, so they’ve doubled down and are going for a hard brexit. Similarly in the US, Trump is the inevitable consequences of this bundling of globalisation with neo-liberalism and the decades of lies told to the public by the right wing media (i.e. blame foreigners, China and poor people for everything….so a guy who blames these for all of America’s problems is suddenly popular!). In both cases baby, bath, water, tub and rubber ducky goes over the side.

There is no reason why we can’t unpick the two things however. The countries that have done best out of globalisation have certainly done so, to varying degrees. Unsurprisingly, communist China does not subscribe to the principle of lassie faire. They will intervene to protect local industries when they feel its necessary. The Germans and many other EU countries have hung on to their welfare state, offering some protection to those effected by the negative consequences of globalisation. They’ve also resisted, to varying degrees, the privatisation of public services (often merely floating public services off into state owned quangos). And they are willing incentivize growth in certain key industries (German renewables for example). Brazil and India have also adopted a policy of resisting privatisation and are trying to build up their welfare states to make sure the benefits are more evenly distributed.

Granted not everything is rosy in these countries, China for example has a lot to do to improve workers rights and there’s still lots of people in India who are desperately poor. The defacto coup by right wing politicians in Brazil (essentially a neo-liberal push back against the aforementioned measures) is hardly a positive. However, one has to compare and contrast with the pre-globalisation situation – workers in China then had no rights period, pretty much everyone in India was desperately poor and Brazil was ruled by a military Junta. But clearly there is no reason for globalisation to remain coupled to neo-liberalism. There is in essence another way. But as noted, the political right, and even some elements of the hard left, are unlikely to do this as this would be a direct affront to their long held ideologies.

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However, rolling back globalisation will have consequences. Already there has been a growing trend of beggar-thy-neighbour style tit for tat protectionism. Unsurprisingly the US, the United States of France (a Time magazine jibe which is actually unfair on the French!) has been the worst offender. These measures however often end up being counter productive. As the BBC reports:

There was an outcry in 2012 when cheap Chinese tyres flooded into the US market, putting the viability of the domestic producers in question.

President Obama responded with punitive tariffs to get China “to play by the rules”.
The protectionist measures were well received in the US, but a study by the Peterson Institute established that the tariffs meant US consumers paid $1.1bn more for their tyres in 2011.

Each job that was saved effectively cost $900,000 with very little of that reaching the pockets of the workers.

Or put it another way, what the Trump’s, Theresa May’s or Corbyn’s of this world don’t tell you is that by opposing globalisation they think that the computer in front of you should cost you two or three times as much. It shouldn’t be nearly as advanced as those available in other parts of the world and it should be less reliable and less energy efficient. Now okay, those on a descent salary, like me, could still afford to pay such prices (or slip one into our luggage when we’re overseas on business). But I suspect those on a lower income will suddenly find that things like mobile phones, TV’s, laptops, cars, central heating, foreign holidays etc. all just became luxuries they can no longer afford. In short, roll back globalisation and suddenly many will find that the UK (or US) just became very unequal and life just became very unfair, very quickly.

The fact is we’ve all benefited from globalisation in ways the elephant graph above perhaps does not capture. I’m not that old and yet I remember when mobile phones were the size of a brick. When cars were so unreliable you had to carry tools around and work time into your morning schedule to account for the inevitable breakdown. When TV’s were so prone to failure some manufacturers made more money selling warranties on them breaking down than on selling TV’s. And your choice of drink in a cafe was builders tea or brown muddy water laughably referred to as “coffee” (Now we have lattes, cappuccinos, green teas and this thing called “salad”). Globalisation and the international competition that it brought forced companies to change. It provided them with the incentive to change, it drove technological progress, allowed them to buy in parts and materials or bring in expertise and investment from abroad to implement these changes.

Yes there were winners but also losers, some jobs did move overseas. Although it has to be said that other countries (not run by neo-liberals) fared better than either the UK or US. And, as I noted in a prior article, a lot of the job losses we blame on globalisation were largely a consequence of increasing automation (the UK now produces nearly as many cars as it did in the 1970’s, but with only a fraction of the work force). And there is little evidence to support the notion that foreigners are taking people’s jobs. Indeed the danger is jobs moving overseas (due to immigration restrictions making it impossible to recruit), or machines taking them. Both these mechanisms are in fact the main reason for the trends in the graph below.

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Germany & the Eurozone has held on to more of its manufacturing than the UK or US

Restricting immigration and leaving the free market will inevitably mean some companies will leave the UK (or the US in the case of Trump winning). The recent “flash crash” of the pound is a case in point. Its now believed to have been caused by a computer engaged in high frequency trading reading an FT article which had key words like “hard brexit”, “crisis” and “far right” in it, shat its electronic pants and sold everything it had. Now while human traders will be a little more discreet and careful about what they do, but they will essentially do the same….then relocate to Dublin or Frankfurt.

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And the decline of 20% in the value of the pound to date essentially means you just lost 2 & a half a month’s salary, once those currency exchange differences work their way into retail and energy prices (oil and natural gas recall are generally priced in dollars). And WTO tariffs would push prices up yet further. A leaked treasury report now suggests brexit could cost the UK treasury £66 billion a year (£1.2 billion a week….rather than the extra £350 million the Brexiters promised).

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Brexit is already causing major problems, for pension funds for example

Post-brexit the UK will find it increasingly hard to export, given the consequences of tit for tat tariff imposition and the fact that we’ll have cut ourselves off from the rest of the globalised world, which will mean the UK will no longer be able to attract the best and brightest (case in point, the Tories recently announced that no foreigners would be asked to advice on brexit policy, or in other words they don’t want the best and brightest available to advise them!). The country will slip further and further behind to the point where UK companies can’t export, unable to sell outside of the closed shop of the UK economy because anything we try to sell is just Lada like obsolete.

Over a long enough time period, the anti-globalisation brigade may well get their wish – more jobs for British people. Foreign multinationals will be streaming into the country, because the UK will have fallen so far behind that it essentially now counts as a developing world country and these companies will want to exploit an impoverished UK and its cheap labour costs. As Paul Mason puts it:

What happens when the investment banks move to Frankfurt, the carmakers to Hungary, the offshore finance wizards to Dublin, the tech companies to newly independent Scotland? What happens when, instead of Poles, it is poor white English pensioners herded into the polytunnels of Kent to pick strawberries for union-busting gangmasters?

Certainly there is a need to rethink globalisation. It needs to work for the benefit of everyone and we need to quit thinking that this “benefit” is measured in the form of dollar bills. The world faces many major problems, overpopulation, peak oil, climate change, ISIS you name it. These are global problems, they need global solutions, which means international co-operation, not more division.

But we also need to acknowledge that getting rid of globalisation would be a very bad idea. If the neo-liberals were correct, that downsizing government and privatising public services was a good idea, then Somalia, which hasn’t had a functioning government in several decades, would be the richest country in the world (instead its one of the poorest and most dangerous places on the planet). Similarly if the Brexiters (or Trump) are right, then North Korea, the country with the tightest border controls and lest free market trade agreements would be the worlds most dynamic economy….of course the opposite is true!

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Opponents of globalisation, simply don’t seem to realise how much the world has changed and hence why we can’t just wind back the clock a few decades. And in many cases the medicine they proscribe would be much worse than what the propose to cure.

 

Brexit betrayals continue

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Before the referendum Brexit voters were warned that they were being conned. But Brexit was simply a means to an end for many in the leave camp, the goal being to further their own careers or line their pockets, they didn’t care about the consequences. They would betray the votes as soon as the referendum was over. And indeed time and again this has been proven right. The £350 million a week to the NHS claim didn’t even last 24 hrs. The vote leave website was shutdown and scrubbed clean within hours of the vote. And given the likely impact of Brexit on staffing and NHS costs, its inevitable the current problems in the NHS will only get worse post-Brexit.

One of the main issues during the debate was immigration. We’ll get a points system they were told. As I for one discussed sometime before the vote, no you’re not going to get a points system, because that would be silly and it won’t work. Low and behold, we’re now told we no there’s not going to be a points system. As I pointed out in a recent post, Theresa May has two choices, she can betray the UKIP bigot brigade and keep borders open, or she can betray the middle classes, pensioners and business tycoons who put the Tories in power, by leaving the single market. Given that its quite clear that the three Brexiters in her cabinet have no clue what to do about immigration, it seems increasingly likely she plans on betraying the bigot brigade.

Yes some window dressing will be applied, Theresa May has shown herself to be a masterful user of the so-called dead cat approach (see here and here). There’s talk for example of a rule that EU migrants will have to have job before moving over. Or in other words they do the job search over the internet, come over on a tourist visa for the interview (or do it via Skype) and then apply for residency. No doubt firms offering to “employ” migrants on a zero hours contract (for literally zero hours) for a fixed fee will soon spring up. The same way some fake colleges are being used to help non-EU migrants to come in. In short it will change nothing. In fact given that the UK leaving the EU will make it easier for genuine refugees from within the EU to claim asylum in the UK, and there’s a good chance of current customs arrangements ending in Calais. So its likely more will be coming in not less, post-Brexit.

And given that the UK will essentially be handing over sovereignty for a whole host of areas to the EU, as part of some Norway model plus, its difficult to avoid the argument that the UK will be worse off with less control over its trade policy. And keep in mind that one of the areas where the UK will retain some leeway is in areas such as employee rights. i.e. those pesky EU laws that stop your boss forcing you to retire because your seen as too old, or the laws protecting your right to strike or join a union, or guaranteeing you can’t be forced to work unreasonable hours. Its difficult to see a Tory government resisting the temptation to roll back these laws.

Farmers were warned that leaving the EU would mean an end to farm subsidies. The leave camp were very careful to say that they won’t end subsidies, or that they would, depending on which audience they were talking too. Well now its likely farm subsidies are going to come under a twin pronged attack. On the one hand there is the environmental argument that subsidies should only be paid out if they provide real environmental benefit. On the other hand, its difficult to see the government paying such generous subsidies to such a small group of voters. And wealthy landowners will be well aware that cutting this lifeline would present them with the opportunity to buy up small holdings and add them to their estates (then likely rent it back to the same poor sod!).

And what about those fishermen who sailed boats down the Thames? Well they’ve already been told not to expect any increase in catch quota’s post-Brexit. I was in Norway at the time of the vote and have been in Iceland before. Their main bone of contention with the EU is over fisheries, not because the EU is too strict but that it isn’t strict enough. And the expert advice is that UK fish catch levels should if anything, get cut.

In short, Brexit voters have been conned on a scale unseen in electoral history. Now politicians do tell porkies from time to time, but I’ve never seen such a outright and blatant betrayal of voters. What Brexit voters need to understand is that those when you saw those Tory placards saying “take control” that slogan wasn’t aimed at the common voter, but at other rich and wealthy elites who fund the Tory party, as Brexit is going to allow one of the biggest transfers of power and wealth within the UK for many generations.

Which brings us to the debate over the 4.4 million petition to re-run the referendum. In the absence of that I think it is fair to argue that Parliament should vote on the matter, prior to invoking article 50, it should be free vote, in both houses. After all this is the very job Parliament exists for, to stop the people being conned into doing something that is neither in their best interests nor the country’s.

Non Rio news

Brexit guarantee

Reacting to the wide scale dismay over possible funding cuts, the UK government has committed about £6 billion a year to guarantee post-EU funding in areas such as farming and scientific research. But critics argue it doesn’t go far enough. Indeed, I would argue its very worrying as it suggests the government simply does not get the message.

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The UK receives billions in research funding from the EU

Take research funding. A clause in the government guarantee implies it only applies to research funding contracts signed before the autumn statement comes out. Given that many of those grants went in the bin on the 24th of June it is highly unlikely they could be resurrected between now and then. That’s not how academia works.

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For UK farmers subsidies are their main source of income

I’ve been quite busy the last week with resit exam marking, I’ve got viva resits coming up and the start of term. It would be mid-October before I or anyone else in academia could get around a table. And it would then take a few weeks or months for the EU to then okay everything. Keep in mind most of the EU research at risk involves collaborative research projects, across multiple states, so even with Brexit it will involve the EU. And typically the EU will only provide a portion of the funds, we then source the rest from private industry. Naturally the private sector, worried about the economic impact of Brexit might still say no.

And what about freedom of movement? A leave supporting MP only recently realised Brexit might leave EU citizens in limbo, nah you think! If I need to recruit a PhD student or a Research Assistant with a specific and narrow set of skills, its questionable if I can do that if I’m only restricted to the UK. Any doubt about my ability to recruit and the other partners (public and private) in the EU will still be asking me to take my name off the application. The fact that the government doesn’t realise any of this just shows you how out of touch they are.

More importantly this announcement more or less confirms what I’d warned before the referendum. That you can forget about that £350 million a month. The UK will still need to pay the EU for access to the single market. Keep in mind Norway pays something like 90% per capita of what they UK pays, we’ll suffer the drop in tax revenue that comes with leaving the EU (due to reduced trade) and we have to come up with several billion more a year extra too.

In short the UK is already worse off and we’ve not even got to the tricky parts of the negotiations yet (where we have to agree to call Cheddar “reconstituted lard” and English wine as “Du Vin Roast beef”).

China warns the UK over Hinkley C

The Chinese have issued a strongly worded warning to the UK over the threat to the Hinkley C deal. As always, this goes way beyond a simple nuclear power plant. It shows what sort of pressures the UK will face post-Brexit.

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China unveil’s its prototype reactor at Hinkley point

Leave campaigners, will argue that they can get a trade deal quicker off other countries than the EU can, which often takes years or decades to negotiate a deal. This is true, in much the same way I could buy a car tomorrow in ten minutes flat….if I didn’t mind going to a dodgy Arthur Daley type and taking whatever cut and shut banger he offered! Getting a good deal means haggling and much arm twisting. The EU can do this because they are one of the world’s largest collective economy’s. The UK can’t because the Chinese (or US) will have the UK over a barrel. Its their way or the highway.

Hence, I suspect Hinkley C will still go ahead, regardless. Its an offer the British can’t refuse.

Leave turf war

Speaking of international trade, there’s a bit of a turf war going on between Boris Johnson and Liam Fox. Both argue that they are entitled to negotiate future international trade agreements. I’m wondering if Theresa May has, rather ghoulishly, taken a leaf out of Hitler’s book. In that he would often put people he didn’t like in departments with overlapping responsibilities and then sit back and watch them squabble.

In short one has to wonder if a number of the Brexiter’s are being set up to fail. Hence when the article 50 business is kicked into the long grass and ignored until after the next election, nobody can complain, and its the Brexit camp who will get the blame.

Norwegian…based in Ireland?

I travelled to Scandinavia over the summer. One thing that I found surprising to learn that the budget airline Norwegian is flagged in Ireland. Why? Well simple, because Ireland is in the EU. Norwegian has big plans to expand across the Atlantic and they know how protective the US is of its businesses (land of the free…but only if you contribute to my congressional campaign!).

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Norwegian Airlines…..flagged in Ireland

Indeed the Americans have raised concerns about how European budget airlines operate. Its also alleged that Norwegian plan on using air crews hired in from Asia for its Transatlantic operations. While I would tend to agree, budget airlines are pushing things a bit too far, but this is clearly a case of the pot calling the kettle black. American airlines have become notorious for squeezing the margins and pushing their pilots way too hard. There have in fact been several air crashes in the US that are blamed on pilot fatique.

So the reality is, all of this is just excuses, because the Americans realise that Norwegian is the thin end of the wedge. What they really fear is Ryanair bringing its not inconsiderable network and low cost model across the Atlantic (they have plans to do so, although they are currently on hold) and driving their airlines out of business. Who knows, if Michael O’Leary has his way, American cabin crew might have to stop being so rude and bossy to passengers!

But obviously the point is that if Norwegian wasn’t based in the EU, the Americans would have just told them to hit the road. But because they are based in an EU country, they have to at least negotiate. This explains the dilemma faced by Easyjet. Its probable that Ryanair will follow Norwegian and expand into the US market. Easyjet will face the choice of being a short haul British based company (hoping that any restrictions on migrant and travel doesn’t mean a dwindling market share). Or leave the UK, likely register in Ireland themselves, and become an international airline.

Yes, Ireland a nation of 4.5 million could well have more airlines in a few years time than the UK a nation 11 times larger! All thanks to Brexit.

When the generations fall out

An interesting article I came across regarding baby boomers, from another blogger. They enjoy a remarkably good deal. Many managed to buy a large house before such things became expensive, they’ve retired on a final salary pension in their 60’s, when most younger generations (or the generation before them) retired on a less generous settlement later….if at all! And a triple lock on their pensions, plus the ring fencing of certain elements of the NHS budget means they’ve been spared the harsh austerity the rest of society has had to endure.

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And to cap it all we have the Brexit vote, where baby boomers overwhelmingly voted to leave, a final two fingered salute to succeeding generations. Indeed, its worth noting that baby boomers are also the worst generation for environmental damage and the most likely generation to be climate change deniers…..and likely to be Trump voters.

In short, there’s a very serious risk of the generations falling out. Many of those flocking to labour and Corybn are young (and angry) millennials. While its unlikely they will win this time around, as the baby boomers die off, its inevitable that the younger generations will gain control and suffice to say there will be a day of reckoning.

Recall, as I pointed out in a prior article Brexit does complicate matters as far as national debt. Any default or “haircut” on national debts will hit pensioners, baby boomers in particular very hard. Many could see their income wiped out. The chances that the millennials will see their incomes squeezed yet further to pay off these debts (run up paying for baby boomers cosy life style and a failure of past governments to tax baby boomers more while they were working), after this generational betrayal, its slim to none.

Italian banks

And speaking of which, the trigger event for a sequence of sovereign debt defaults could be about to strike. There’s been further concerns expressed about the health of Italian banks. Italy is at risk of economic turmoil if a referendum goes against the government.

Now any Brexiters who feel smug and say this is why we need to get out of the EU, well no. The entire global economy is interconnected. If Italian banks go down and risk bringing down Italy, the impact will be felt worldwide. And its pensions and savers in the UK who will have to take a hit.

Ultimately, the world’s governments will face a difficult choice, bailout Italy (not an easy thing), or risk a contagion of debt spreading through the whole economy. A default of Italy would of course leave investors worrying about who is next and whether “safe as the bank of England” is really that safe. Which could make things very difficult for governments dependant on credit (such as the UK).

First contact?

Another interesting story revolves around a mystery object exo-planet hunters have discovered. They’ve concluded there’s something odd about a star some 1,000 light years from Earth. Some are arguing that it could be signs of an alien mega structure known as a Dyson’s Swarm. While unlikely, the very fact its being seriously considered is of interest (no scientists wants to be a member of the “I saw a flare” club, so they won’t announce this unless they’ve evidence to back that up). Its good to know there might be intelligent life in the universe…because there’s bugger all down her on Earth!

Trump’s minions

How can you not mention Trump, he’s like a sort of virus. However its more his minions that I want to talk about. Being a spokesman for the cult of Trump has got to be a pretty awful job (worth seeing Trevor Noah’s take on this here). Your boss says the most insane batshit crazy stuff, you have to try and row back on it, no he didn’t say that…..okay he did (after being confronted with a video of him saying it), but that’s not what he was trying to say….Only, for Trump to come out and reverse course again two minutes later. Its likely he’s killed the career of Rudy Giuliani, Chris Christie and Newt Gingrich.

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However, another tactic of Trump’s minions is to try and out Trump Trump. Take his chief Spokesperson Katrina Pierson. She’s an ex-Tea party candidate who proved to be a little too crazy even for the tea party (she’s wears a necklace….made from bullets!). She’s regularly gone beyond Trump in craziness, recently blaming the US invasion of Afghanistan on Obama (leaving TV journalists speechless). When the insanity of what she was suggesting was pointed out, she tried to blame her microphone (an excuse both she and Trump have used in the past…perhaps we should start a kickstarter fund for her and Trump to buy a hearing aid?).

And Trump has recently announced changes to his campaign team. His campaign chief Paul Manafort, under pressure over payments to him linked to Putin, has been pushed aside. Instead Trump’s brought in the boss of Breitbart (a man referred too as “the most dangerous political operator in America”) and allegedly also ex-Fox News chief Roger Ailes. Which incidentally does raise some awkward questions as to what was going on over at Fox News during that whole Trump v’s Megyn Kelly saga (keeping in mind, Ailes was Meygn’s boss).

One has to worry what sort of fruitcake’s Trump will dig up to form his cabinet, in the increasingly unlikely event of him being elected. Its no wonder some are arguing that Trump doesn’t actually want to be president, he only did it to further his TV career and is now deliberately sabotaging his own campaign.

Let me draw you a picture

One of the problems with climate change deniers is that they will waffle along, making spurious contrarian claims at such a rate one can’t debunk them all, or quote misleading information (often doctored or deliberately misinterpreted). In a recent debate in Australia Brian Cox managed to outwit climate denier and member of the neo-fascist “One Nation”, Malcolm Roberts, by bringing along a graph of the data that he claimed didn’t exist.

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Naturally this led Mr denier to claim the data, collected by NASA, was “doctored”, leading Brian Cox to question Roberts whether he also believed NASA hadn’t landed on the moon. While this might seem a bit of an unfair jibe, but as I’ve pointed out before the idea that dozens of agencies around the world, universities, NASA, ESA, the Met Office, the Tyndall centre, Scripp’s institute, the US military, etc. could all independently conduct studies (often relying on different data sets gathered in different ways) and reach the same conclusion. This leaves one only one of two alternatives, a) the evidence supporting climate change is rock solid, or b) all of these agencies worldwide are engaged in one massive global conspiracy, that makes faking the moon landing seem simple. So if you believe the climate data is doctored, then it is legitimate to question whether said individual is a tinfoil hat wearing conspiracy theorist.

Also deniers need to realise that they’ve been “found out”. The website “Skepticalscience.com” now has an easy to browse list of many prominent climate contrarians, listing their favoured climate myth and the information to debunk them. They also have a complete list of all climate denier myths along with the counter arguments, filed at a range of different levels (e.g. a simple quick explanation, or the hard scientific one). So in truth all you need to do to combat a climate denier these days is have a smart phone or I-pad and this website open on it.

The future of work

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Many from working class areas of Britain voted for Brexit because they fear their jobs are under threat from migrants. Similarly support for Trump has been growing in parts of the US rust belt. And there’s a major divide, both sides of the Atlantic, when it comes to education. If you have a college degree, you are very unlikely to be a Trump supporter and less likely to have voted leave.

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Now it has to be said that the argument that migrants are taking jobs isn’t backed up by the facts. A strong leave vote was seen in the parts of the UK with the lowest number of migrants, while places like London with very high rates of migrant tended to vote for remain. Similarly, major US cities, where migrants tend to concentrated tend not to be the places where there is strong support for Trump. So either these migrants are holding down three of four jobs (and presumably being rapist, drug dealers and claiming benefits in whatever limited free time this busy schedule allows them), or the risk they pose is being vastly overestimated.

When I hear the story about how, oh I can’t get a job because the company down the road just hired a load of Poles/Mexicans who will work 60 hours a week for 3 bucks an hour, my response is A) don’t you think you should report that to the proper authorities? because its kind of illegal! B) leaving the EU ain’t going to help, you do realise Switzerland and Norway have more migrants per capita than the UK? C) In a globalised world, restricting the movement of labour will result in jobs moving overseas, so its foreigners staying at home and taking your job we need to worry about (far more jobs have moved overseas than have been taken by foreigners moving here) and D) do you have these guys number? cos I’ve got this bit of decking…..

But there’s an elephant in the room here that I think both sides of the debate are missing – automation and technology. In short, even if it were true that you’re in competition with Poles or Mexicans working for £3 a hour (which you aren’t, its just a neo-fascist myth), how do you expect to keep your job when you are competing against a machine that will do the job 24/7 for nothing?

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Like the frog in the saucepan, technology has crept up on us and we’ve not noticed. And yes it is changing the workplace as we know it . Think about it, when was the last time you rented a video? I’m guessing you get your video fixes from youtube or netflix these days? In fact when was the last time you saw a video store? Are there any young people reading this who need me to explain what a video store is? How about booking a holiday or flight in a travel agent? And I mean in an actual office, not online? Same with car insurance or other financial products. What about paying your taxes online? don’t tell me you actually take a day off work so you can go down the tax office and do in manually (obviously you’ve way too much free time!).

Online shopping is now much more common. And in shops these days various tasks are becoming more and more automated. We have those self service checkouts. Its conceivable in the not too distant future that shelves could be stacked by machine (we have machines that can do that already) or even provide customer service (yep, they’ve prototype machines that can do that).

Automated cars are now being developed and while I reckon it will be some time before they become a day to day reality (not because the machine’s aren’t smart enough, but because they have to share the road with dumb humans). But they are probably going to happen eventually, which will have numerous implications…. and meaning a whole host of jobs disappearing or changing radically. And there are similar plans to automate entire ships, cargo planes or trains.

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Could the Johnny cabs of Total Recall become a thing of the future?

In short technology has changed the world of work and it will continue to do so. There will still be jobs available, but many traditional jobs will disappear, and the skill set you need to get those jobs still available (or the new jobs created by technology) will continue to rise. This is the problem facing certain segments of society. As they see it, the bar keeps going up, they can’t get over it anymore, so they have it in their heads that we can somehow lower the bar again and keep everything the same, but we can’t, not without reversing many recent technological trends and isolating ourselves from the globalised world.

In manufacturing engineering for example, we are well ahead of the curve. There’s still plenty of people working in UK factories and the UK still makes lots of stuff. Prior to the Brexit vote the UK was on course exceed its 1970’s peak in car production by the 2020’s, even though the work force is a fraction of what it used to be (i.e. automation has made a smaller workforce more productive). However, nobody gets a job these days in a factory without some sort of qualification. The days when, like in Bruce Springsteen’s “the river”  (or Jimmy Nail’s “big river) , your dad could have a word with the guys down at the plant and you could walk straight into a unionised job for life are long gone.

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Many traditional jobs will increasingly disappear in future

And my prediction is that this will now roll out across the entire economy. The blunt message I’d give to people is that if you don’t have some sort of third level qualification (a degree or professional qualification of some kind) you will probably struggle to remain employed in future. So for those who voted Brexit, or are thinking of voting Trump, I’d say leave migrants alone, they are not the main threat to your employment, you need to get educated.

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And to be honest, you won’t want to be employed in future if you don’t have a qualification. What few unskilled jobs that remain will be increasingly the really crappy jobs that nobody wants, with the highest levels of job insecurity and the worst pay. The sort of jobs which will only be taken by students (who will take anything while they pay their way through college), recently arrive migrants (who just want some cash while they settle in), or those suitably desperate who can’t find anything else. Indeed, the employees of Sports Direct will argue this is already reality for them. You could argue that quite a number of those who voted Brexit (or Trump) are the canaries in the coal mine, as they are already seeing these effects.

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Feel worthless at work sometimes? Others have it worse

However, their actions are likely to prove counter productive. Restricting migration does not mean locals will find it easier to get work. What’s likely to happen is employers will just move jobs overseas, or you’ve just given them a very strong financial incentive to find a way of developing a machine to do those jobs instead.

So clearly such a future of work means some profound changes for society. Obviously the costs of third level education means its beyond the reach of many. Hence why I think of all the proposals from Bernie Sanders that Hillary needs to endorse, its reducing college tuition costs. Yes, I realise that won’t be cheap (i.e. can she afford it and still reduce the deficit?), but I suspect it will be a necessity in future, if a massive level of social stratification is to be avoided.

And in the UK far from putting up fees, we need to start cutting them. Is it any coincidence that in countries like Germany where higher education is free, there is less unemployment and less people whinging about migrants?

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And this is not just for the benefit of those who don’t have a degree yet. Even those of us who have one will likely need to return to university to learn new skills from time to time. A recent trend in academia has been a move towards what are called massive online learning courses. And these are mostly aimed at post-grads (rather than undergrads) looking to learn a new skill. I won’t be surprised if a few years from now, the main job of universities is supporting courses like this, rather than teaching degrees to undergrads in RL.

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The future of work will likely be a future where we need to accept the fact that change is good, its normal. We need to be intellectually curious and willing to learn new things and try out new ideas. Of course if you’re a conservative voter, changes are you’re not intellectually curious and you don’t want things to change. You are also more likely to reject ideas like global warming and evolution. The roller coaster of technology is going too fast, they want it to stop so they can get off.

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In the future all of us will need to re-train and change careers from time to time

But getting off the roller coaster would mean giving up what we have. Given that I can’t see us banning the use of the internet for commercial purposes (I mean how would you even police that!) or introducing soviet style jobs for the boys policies (you join one queue and then another), I don’t see how these future trends can be halted. Technology has created many problems for our society (e.g. global warming) and often as not, the solution to these problems is more technology (e.g. renewables, electric cars). So the “getting off the roller coaster” option that conservatives are aiming for would come with a price and I don’t think they understand that this price is probably more than they are willing to accept (you’d have to live sustainably without fossil fuels or renewables…. so basically become Amish!).

Another question we have to ask is whether full employment is a realistic goal for future society. Our entire economic system assumes that anyone who can work will work, but that may not be true in future, there might not be enough jobs to go around in the future.

Now in theory this shouldn’t be an issue. Technology merely means making a smaller pool of workers more productive. In Germany and Scandinavia, yes the manufacturing sectors are smaller than they were a few decades ago. But they avoided the wholesale decimation of working class areas seen in the US or UK, with some districts being reduced to little more than welfare colonies. This I would argue is because the bulk of these job losses were due to miss guided neo-liberal economic policies in the US and the UK. Reversing these policies would seem a sensible solution, although voting for Trump or Brexit amounts to asking for a double helping of more of the same.

So in theory, full employment is still a possibility. But we need to remember that more productivity often means more energy and resource consumption. Now with good recycling policies and a 100% renewable energy grid this shouldn’t be a problem, but we don’t have that yet. So its possible that full employment will not be possible in future (at least for some period of time). Which means some profound changes to society. Given that already the number of workers is falling in Western states thanks to an ageing population, this means even less and less people having to pay more and more of a nation’s taxes to fund the welfare for those who aren’t working.

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Migrants are increasingly needed to help fund retirement for an ageing population

And incidentally curbing migration, which means less young people coming into the workforce and paying taxes to fund the pensions and healthcare of retirees, is likely to prove entirely counter-productive. It could well be a recipe for national bankruptcy.

My view is that we may need to change how the entire tax system works. This is one of the reasons I’ve long favoured a system of carbon taxes, or taxes on things that are generally bad for society (e.g. high VAT on alcohol or fatty foods), a Tobin tax (i.e. a tax on financial transactions) and of course higher rates of corporation tax. In all cases, the goal here is to spread the tax net away from simply funding everything off of income taxes and pushing those rates up every time the state coffers run bare. Which of course tends to provoke much whinging from the fewer and fewer workers stuck paying incoming tax.

And as for distributing welfare, well one alternative to the current system is that of a basic national income paid out to everyone. This would be enough to fund housing and keep people out of poverty. You want more money, you want the luxuries, get a job and work for it. No more whining about lazy people on benefits, everyone is on benefits, indeed presumably this system would come with the clause that such payment would be withdrawn if anyone commits anti-social behaviour (e.g. petty crime, dodging taxes via your offshore account, the usual!). Just this year the Swiss at a referendum on implementing this. Now while it was rejected, I think this was because many didn’t understand the underlying issues. So I won’t be surprised if such ideas don’t catch on in future.

So in essence our society is at a crossroads. I’d argue that we are at the end of a 2nd gilded age. Like the first gilded age, this was a time when neo-liberal capitalists ran wild, we all had a big party and nobody complained a lot because everyone was doing rather well out of it (as this moment of Zen from the film Margin Call summarises). But now, like in the 1920’s we’re stuck with the hangover. And like society in the 1920’s we face a choice.

On the one hand we can opt for a new deal of continuing down the path of social and technology progress. And let’s face it, progress is good. The factories of past era’s, yes there was full employment, but they were awful places to work. Repetitive backbreaking labour while being exposed to extremes of heat, noise, toxic chemicals and rotating machinery. Many had to retire from such jobs in their 50’s because their job ruined their health. Technology means that cars and other products these days are safer, more reliable (used to be the best way to make money from TV’s was selling warranties to fix them), more energy efficient and more user friendly. I mean is anyone reading this seriously suggesting that they hate Microsoft/Apple/Google so much that you want your old Commodore 64 back?

Or, as some societies did in the 1920’s and 30’s, we may end up taking the regressive path of fascism, blaming foreigners and other convenient scapegoats for all of our ills, restricting trade, reversing past policies, going backwards and focusing inward….until said leaders realise they need a war to prevent national bankruptcy and likely end up starting world war 3 in the process!

News roundup

The 2nd longest suicide note in history

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The Republican national convention is currently kicking off and things aren’t off to a great start. The cops are calling for the state’s open carry law to be suspended (after recent police shootings they’ve come to realise that the solution to a bad guy with a gun is and making sure he’s not armed, and not hiding in a crowd of 100 other armed nutters). And with the cult of Trump in town and lots of angry anti-Trump protesters, trouble is all but guaranteed.

Many leading republicans are skipping the convention (and probably with all the guns are very glad to do so!) as they want to stay well away from the train wreck otherwise known as Trump. As a result the roster of speakers at the convention is a little thin, even Trump’s wife and daughter is having to speak, oh and the boss of the Trump winery (presumably to help push Trump’s merchandise). About the only senior republicans speaking are Paul Ryan (who has to speak, someone from congress had to show up and he drew the short straw), Chris Christie (aka, Trump’s official sidekick) and Newt Gingrich (Trump’s wannabe sidekick).

Meanwhile the policy agenda that will be endorsed at the convention includes a number of extremely conservative positions. For example porn is labelled a “public health crisis, they want to crack down of gays, introduce “gay conversion therapy” (I don’t know either, maybe get them to watch porn…oh no wait didn’t we just ban that?), banning abortion, etc. They’ve even managed to piss off the ADL. Although to be fair, as Israel is not a US state and both Trump and his supporters are clueless to anything outside the US, it would have to be pointed out to them on a map.

The GOP has avoided including such toxic policies in the past, because they know they would never get through congress (even some Republicans would vote against them!) and even then they would likely be struck down by the the Supreme court. All you’re doing is loading a gun with ammo for the democrats to blast away at them with for the next four months. Trump’s manifesto could well go down as the 2nd longest political suicide note in history.

Already comparisons are being drawn to the disastrous convention of 1992. Back then the GOP had spent several years trying to woo white evangelicals such as Jerry Farwell’s “moral majority” into the big GOP tent. Up till then many christian conservatives had not voted because the party of Lincoln was after all the party that freed the slaves, while the democrats had decided that minorities had all sorts of “rights” and you couldn’t like lynch em or burn crosses on their lawns no more (bloody liberals!).

Anyway this plan backfired with the Christian conservatives effectively hijacking the GOP policy committee and forced it to adopt various right wing policies, not unlike those Trump is now endorsing. This appalled many moderate Republicans, who took the view that the GOP was supposed to be the party of small government, not the party that advocates an authoritarian state that dictates what people do in the privacy of their own homes.

Consequently G. W. Bush, whose campaign was already behind due to a struggling economy, was from this point on all but guaranteed to lose to rank outsider Bill Clinton (whom most people had never heard of at the time). And lose by a significant margin he did, becoming one of the few US presidents in recent times not to win a 2nd term in office.

And to make matters worse for the GOP, the fall out from the convention led to a resurgence in support towards the third party campaign of Ross Perot’s. Now while this took as many votes away from Clinton as it did Bush, the fallout carried over into the 1996 election, where again Perot ran on a ticket appealing to small government moderate Republicans, the people edged out or booed off stage in the 1992 convention. And again, he cost the GOP precious votes all but guaranteeing Clinton a 2nd term.

So while this will be an awful sickening coronation of Trump, it also could well be a funeral of sorts for any hope of the Republicans winning diddly squat for a good few years.

Police shootings
Recent police shootings in America are cause for concern, although statistics do suggest that the overall situation isn’t quite as bad as might be thought. Cop killings have been steadily falling for sometime now.

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However, certainly the toxic atmosphere of recent months means that the police forces in America are loosing public support. It is argued that the police are only police because we the public consent to them their authority to uphold the law. If this consent is withdrawn, well they ain’t much more than a rent-a-cop mall guard. And should any cops be wondering how to tell if you’ve lost the support of the community, well when they start shooting you just for being cops, that’s probably it!

But getting shot at is only the start. And to be honest tighter gun control would solve that problem. Its the inability for police to do their job that’s the danger. If the public don’t trust the police, they won’t rely on them in a crisis, they’ll turn to someone else, likely the local Mr Big. The rise of the Mafia in America, first the Irish mob, then the Italian mob, was borne out of the fact that these immigrant communities did not trust the cops. History is in effect repeating itself.

Trident vote

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The UK is voting on Trident renewal. The Tories have been accused of only holding it now to help destabilise the labour party. And the price tag? A snip at £205 billion, or to put it in Brexit bus terms that’s £569 million a month for the next 30 years.

However, I cannot help but notice that if the vote were being held north of the border, the result would be very difference. Only one MP is planning on vote for Trident, (David Mundell, the only Tory MP in Scotland), all the rest are either abstaining or voting against it. Is this because the missiles are based in Scotland, while the armchair chicken hawks chatter about it in Westminster, or is it because Scot’s can add and subtract and realise its a complete waste of money?

Indy Ref2 next year?
Theresa May met with Nicola Sturgeon last week to discuss the consequences of Brexit and the possiblity of a further referendum (on the EU or Scottish independence). I assume it didn’t go so well, because within hours of it ending we were hearing murmurings of a possible 2nd Scottish independence referendum in early 2017.

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Let us be clear about what is going on here. Yes the SNP want Scottish independence, but unlike Cameron they aren’t morons. Yes, the polls do show that the ground has shifted, with several polls now showing a clear (but sometimes narrow) lead for independence. But you can never guarantee anything leading into a referendum, not unless you are well ahead (and recall remain had a ten point lead at the start of the EU referendum). It would make sense for the SNP to wait as long as possible before calling a referendum. And they also realise that they have to explore every possible alternative before committing to one.

On the other hand, the Tories attempt to stonewall the Scot’s is making it very easy for the SNP. The Tories are trying to ignore this shift in the polls, ignoring the very narrow majority in the EU referendum, not to mention the fact that only 37% of the electorate actually voted for Brexit and many millions (EU citizens and British citizens abroad) were denied the right to vote, as were students not at their term time addresses. And of course an overwhelming proportion of Scot’s voted against leaving the EU.

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Of course there’s an obvious horse trade here. The Tories allow the Scottish, Welsh and Northern Irish assemblies some input to the terms of Brexit. And furthermore, a requirement it is ratified either by all four parliaments, or via another referendum. However, the Tories seem to be ignoring this, same way they are ignoring the fact that the EU referendum result is not legally binding and that they may face obstacles getting it through Westminster. As a result the same Tory arrogance that led them into the first inde-ref (and the EU referendum) could well be their undoing this time around.

Vote leave bus rebranded by Greenpeace
Greenpeace have somehow managed to get their hands on the infamous Brexit bus with all of the misleading slogans on it. I was surprised by this, as I assumed that, like the Edstone, it would have been destroyed….ritually burned….presumably with Gove still inside!

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Anyway, it would appear Greenpeace plan to “correct” the messages on it and drive around with it as a “vehicle for truth”.

The Tories thought that they could tell a few lies to the public, so that Boris could get to be PM, but what harm could it do, I mean who remembers politician’s promises? I mean remember when that Clegg fellow made that promise to students about fees, why they forgot about that within a week. No way this £350 million claim will come back to haunt them, next election, would it?….ah no!

The Brexit camp have created a enormous level of distrust by their actions. And yes, this £350 million claim did sway voters, and yes they expect it to be honoured, I had a conversation with someone who repeated the claim a few days ago (he seemed to think taxes were about to go down after Boris told em we’ll not be paying the £350 million anymore). Couple that with the fact that there will be little if any change to immigration rules and you could argue the Tories have made life very tough for themselves. Ironically there are worries for the future of NHS funding post-Brexit.

And if there is another indy-ref next year and project fear is resurrected, what’s the bet that the SNP counter is, these are the same people who told us we could save £350 million a week by leaving the EU. If you could write anything on the Tories party’s tombstone (well aside from ding dong the witch is dead!) it would be this £350 million a week claim.

Mrs Fracking
There are growing concerns about the axing of the DECC, which I discussed in a prior post. But worse the decision to hand over part of its responsibilities to Andrea “Fruitcake” Landsom has been called into question. She’s a pro-Fracking, climate Skeptic known for her extreme views. I could argue that its putting the fox in charge of the hen house, but actually she’d shoot the fox (she’s pro-fox hunting) and burn down the hen house to save it. She’s also on record as arguing against farm subsidies, which is obviously very worrying for farmers, who are already anxious over the consequences of Brexit.

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I mean Tim Peake got back from Space, learnt about Brexit, Trump and all that’s happened since he left and tried to rush back into the capsule (okay, not quite!).

The Consequences of Brexit

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I was away on holiday during the vote, I mean I go away for 3 weeks and you lot exit the EU, WTF! Oddly enough I was outside the EU in Norway, basking in land of milk and honey the leave camp promised us?…well actually no.

The Norwegians couldn’t understand why Britain left the EU. They have to pay to be a member of the EEA (one of them was moaning to me about its considerable costs) yet not gain any of the benefits of being an EU member. The main reason why Norway is not in the EU boils down to fisheries. Not because they fear EU regulations, actually they feel the EU doesn’t regulate fisheries enough.

But at least the Norwegians have control over their borders right? No! There are more migrants per capita in Norway than in the UK, about 25% more in fact and they are arriving at a much faster rate than in the UK (nearly 3 times higher per capita faster). At one point (keeping in mind I was in rural areas, small fishing villages, not major towns) I was on a bus, the driver was Chechen, there were several middle eastern gentlemen (who got off at a fish factory, where clearly they were working), quite a few Chinese (and with the prams and shopping bags, I’m guessing they were locals), some tourists like me and perhaps one or two actual Norwegians.

And Switzerland has double the number of migrants per capita that Norway has. The only EEA, non-EU country that has a lower number of migrants than the UK is Iceland (which is only marginally lower). Which probably has less to do with Iceland’s migration policy and everything to do with the name of your country including the word “Ice” in it (hence, migrants tend to give it a wide berth fearful they’ll freeze to death or be eaten by a polar bear). So unless the Brexiters are proposing to rename the UK “Icebergland” or “Monster Island”, its unlikely this will have any impact on migration.

And already a number of the predictions and warnings are starting to come true, the pound has plunged in value, the stock markets were down $2 trillion in just 48 hrs, trading in certain shares was actually suspended at one point. Inflation is likely to rise, food prices will go up and many of those retiree’s and people on low incomes who voted leave will soon themselves considerably worse off and baring the brunt of consequences (as predicted).

Immediately I felt this effect as it meant everything started becoming more expensive. Room’s I’d booked a few days earlier suddenly rose in price rapidly. It was like living in Zimbabwe. I was in a queue waiting to change the last of my Kronor’s in Oslo airport, reading the news when I saw the story about the UK being downgraded by all 3 of the major rating’s agencies, so when I was asked which currency I’d like my money back in I said euro’s, rather than pounds.

Dirty rotten scoundrels – Project Betrayal

On his way out the door Cameron said that the leave camp had a lot to live up to, by which he meant all the insane lies and promises they made prior to the vote. Well less than 24 hrs after the vote they were breaking every single promise made. Apparently they never promised the NHS £350 million a week, despite driving around on a bus with that written on it.

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Nor indeed will there be any changes to immigration law, because there’s no proof anyone voted leave due to fears over….despite the leave camp stirring up racial hatred for months (to the point where an MP got murdered). After all if Britain applies such restrictions to other EU states, they’d reply by doing the same to Britain in turn (which would lead to many ex-pats from the UK being forced to return home, and millions of them coming back in all at once would make any current issues regarding migrations seem pretty small).

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And fishermen have been warned to expect no increases in allowed catches. Indeed, the experts have been warning of over fishing for years, post-Brexit the expert advise would probably by for a complete halt to all fishing in UK waters for a few years.

To EEA or not to EEA?

The crucial question the markets are asking is whether or not the UK will now go for a “Norway model” of EEA membership. This would give the UK access to the single European market and involve the least amount of disruption to the economy.

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However, as noted earlier this represents pretty poor value for money. The UK would still essentially have to pay the EU for the privilege (Norway pays 83% of what we pay now), most of those pesky EU laws the leave camp were hammering on about would remain in place, only now the UK gets no say in any future changes to said laws (our EU parliament members are essentially replaced by fax machine in Whitehall through which future EU dictates will be received and implemented with question). And crucially there will have to be a commitment to free movement of people, the Germans have been pretty clear about that one.

The only reason Norway and Iceland accept these terms (rather than just go the whole hog and join the EU) is because of issues regarding fisheries (as noted), while the Swiss worry about the EU trying to arrest all its bankers and money launderers, if they became a member. So these countries accept these conditions for very specific reasons.

Yes there will be some changes. Much like other EEA countries, EU citizens coming over will have to fill in a few forms, it becomes a bit easier to deny them benefits (until they start working and paying taxes of course). But once they’ve been here long enough it will make no difference in real terms, just more bureaucracy (which of course UK tax payers will be paying for of course). The likelihood is that the result will be (as noted) no decrease in migration. Indeed in certain scenarios it could lead to an increase in migration, as minorities in the EU who currently can’t apply for asylum in the UK will gain that right.

The UK will also be able to pick and chose to keep certain elements of legislation its adopted from the EU. And the main two areas where they will be able to effect change are employment law and the environment. In short, its likely the Tories will now gut employment laws and remove many of the rights and protections that workers, particularly low income workers. have long relied on. By voting for Brexit they have now voted to remove the laws that say, stops you being fired by your boss just because you got sick or insisted on wearing a safety harness to stop you falling to your death. And forget about asking for Christmas day off to be with your family, or for overtime pay.

As for the environment, its now likely the laws here will also be gutted. Its now questionable, if not very improbable that the UK will remain committed to its the promises made during the Paris climate conference. Siemens has already announced it is freezing all wind farm development in the UK. Its also been warned that the £20 billion in new energy infrastructure the UK now needs to keep the lights on may not be build in time. Warnings have also been raised about further delays or a cancellation of Hinkley C.

Rise of UKIP?

Now while the markets, private industry and quite a few in the Tory party are quite happy to push back from the table and take EEA membership as the least worse option, this is very different from the milk and honey” promises made during the referendum. Of the leave camp people, I can count using my thumbs the number who voted leave for reason other than immigration. Many of the Brexit voters, once they realise they’ve been conned on a massive scale, will probably not accept those terms and probably drive for something else. Of course they won’t get it, but they’ll try. As Paul Mason puts it:

What happens when the investment banks move to Frankfurt, the carmakers to Hungary, the offshore finance wizards to Dublin, the tech companies to newly independent Scotland? What happens when, instead of Poles, it is poor white English people herded into the polytunnels of Kent to pick strawberries for union-busting gangmasters?”

But if the Tories think they’ve killed off UKIP, think again. My guess is that whoever emerges from the Tory leadership contest will go to the EU, sign away Britain’s sovereignty in exchange for EEA access, leave the country worse off than it was before. There will be (as noted) no specific immigration restrictions.

UKIP will ignore the reasoning behind this (reason and logic aren’t exactly their strong points) and they will respond to this complete betrayal of every promise made during the referendum by campaigning at the next election on a platform for tearing up any EEA agreement and “shutting the border”. They’ll promise a points system (which as I’ve discussed before, won’t work and ignores certain fundamental facts such as the fact that Canada or Australia don’t apply their points system to their immediate neighbours), and much other silliness. Inevitably they’ll pick up some significant portion of the leave vote and likely split the Tory vote.

In essence all Cameron will have done is guarantee that his warring party will now struggle to ever get a majority in future. They will only ever be able to form coalition governments with either the lib dem’s, labour, or if desperate UKIP.

Labour unity?

Now is the time for labour to take advantage of the political chaos in the Tory party, rise above events and cease the moment…..if they weren’t at war with themselves! Okay, Corbyn could have been a bit more active during the referendum campaign, but to blame him for Brexit is simply not fair. The blame lies squarely with Cameron. Like everything else he screwed it up, holding it at a time of year when the turnout from young voters would be low (as they won’t be at term time addresses, or working, or at Glastonbury) and millions of Brits abroad or EU citizens who’ve lived here all of their lives were excluded from the vote.

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But such is the labour party’s hatred for their own leader, he can’t do anything right. If he rescued a baby from a burning building, half his team would quit on grounds that he was anti-fire, mocking man’s greatest invention while taking jobs away from hard working firemen.

A labour leadership battle now could not be more ill-timed. And the balance of probability is, either Corbyn will emerge victorious (once the party faithful have another vote) or someone else from the hard left of the party will take over in his place. Granted, labour’s changes at the next election are better with a centrist in charge, but a leaderless, warring labour party has no chance.

Scotland?

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As expected, the SNP have suggested a 2nd referendum on Scottish independence is now very likely. 63% of Scot’s voted to stay in the EU, in parts of Edinburgh, the remain vote was as high as 78%. And as also expected, opinion polls are starting to show a lead for independence. A recent poll post-EU referendum suggests a whopping 27% lead to independence, although previous polls suggest a smaller lead.

It would make sense for the SNP to delay any independence vote for as long as possible. Let the economic bad news build, let more of the leave camp realise that they’ve been betrayed and conned by the Tory party, then when the country is nice and angry, call the referendum. While I was minded to support independence last time (but critical of the SNP), but I guessed it probably won’t pass. This time., I’m not so sure. Like I said, it will boil down to timing.

And Sturgeon shows every sign of playing it cool this time. She’s been in talks with Gibraltar, Northern Ireland and even the London mayor about some sort of plan to keep these regions in the EU, but perhaps still in the UK. I’m not entirely sure how that would work, but by going through the motions she can claim that she at least tried.

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She’s also talking to the EU directly (having already been in talks with the Irish) and will be meeting with the EU president shortly. And some of the murmurs coming out of Brussels suggest she made find a sympathetic ear.

If Scotland can get some sort of deal from the EU, either an option to leave the UK and stay in the EU (unlikely, but worth a shot), or some sort of fast track framework to EU membership (keep in mind, leaving the UK will take a few years anyway) then that could dramatically change the outcome of any 2nd Independence referendum. A narrow chance of a Yes suddenly becomes a near certainty.

Currency is an issue too, as it was a key factor last time. I would hope this time the SNP have the sense not to propose keeping the pound, which is falling in value and probably not a very safe bet. Some sort of “Denmark model” for a future Scottish pound is a possibility. It would be pegged to the euro initially (until an independent Scotland is able to find its own feet), then later allowed to float more freely. This would be a much more sellable option that all the if’s and possibly maybe’s from last time.

In short, by England voting for Brexit an independent Scotland looks a lot more likely.

United Ireland?

And in Northern Ireland too, Sinn Fein are already seeking a border poll on uniting the Island. Of all the regions in the UK, Northern Ireland will suffer the worst from Brexit. They have to compete against a Republic of Ireland where taxes are lower, our GDP is higher (so people have more money to spend), we have better infrastructure, more third level graduates, access to the eurozone and now post-Brexit the single market too. Ask yourself if you were setting up a company on the Island of Ireland, which side of the border would you set up in?

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Its worth keeping in mind that Brexit puts the northern Ireland peace process under threat. The lack of border controls, means any attempt to impose any kind of immigration restrictions on EU citizens in the UK will be impossible. All a Polish guy will need to do is get a cheap Ryanair ticket to Dublin, hop on a bus (there are buses direct from the airport) and he’ll be driven straight to Belfast city centre.

Any sort of tariff’s will result in smuggling, which means more money going towards terrorist groups up in the North (this was sort of the whole point in doing away with border controls, eliminate a key flash point!). Putting border controls at northern Ireland ports would be unprecedented (and probably unworkable given the shear volume of traffic they handle). I know of no other country that has border posts within its own national boundaries. They effects on the Northern Irish trade would be considerable, and inevitably drive more towards voting for a united Island.

So the Good Friday agreement will have to be renegotiated and you can bet what Sinn Fein’s demands will now be. Certainly opinion polls, all taken prior to the EU vote I might add, do suggest no appetite for a united Ireland. Even among Northern Ireland Catholic’s its questionable if you’d get a majority. However, I suspect that given time this will change.

It is often forgotten that the silent majority of Northern Irish people are neither strongly unionist, nor republican. They just want to get along and keep their job. Naturally if this majority now start losing jobs, start see their mortgages and living costs rising, then those poll numbers will start to shift and eventually you will probably find that a majority voting for a united Ireland isn’t that unlikely.

Interestingly there’s been a huge rush for Irish passports since Brexit. Being Irish (which fortunately I am) is a sort of post-Brexit hack. You have all the rights of British citizenship, but are also an EU citizen. The Irish passport office is starting to complain about the shear volume it now needs to process. Potentially 6 million in the UK could apply (that’s nearly 10% of the population!).

Certainly one has to say, as I’ve been saying for years, a UK outside of the EU might well mean an end to the UK. Hence why UKIP should really call themselves the UK destruction party.

Indeed, a complete break up of the UK isn’t that unlikely. I don’t think it will happen soon, but it may well now be a medium term inevitability. One could argue that the UK is a pact based on the understanding that the England will not allow overt English nationalism to do anything that would harm the interests of the non-English minorities within the UK. If you take the view that that contract was just torn up on the 23rd, then the pact that has allowed the UK to exist is broken and its very possible the different parts of the UK will eventually go their separate ways.

I mean, even some in London are talking about independence from the rest of the country now!

Economic fallout

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As noted there’s been turmoil on the markets the last few days. And while there’s been something a a rally (which I’d put down to news that Teresa May seems more likely to success Cameron than Boris!), one can expect this to be temporary. With every drip of bad news the markets will gradually drop that little bit further. Already many companies have put in place a hiring freeze, my uni’s already done so, were expecting an announcement as to whether a spending freeze will also now come in.

Obviously a slow down in the economy will produce a bear market, falling stock prices, rising inflation, wages frozen yet the cost of living going up and falling tax revenue. While Osborne has backtracked for now on a post-referendum emergency budget, its difficult to see how some changes won’t be needed.

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The trouble is Osborne’s already pulled all of the Austerity levers he can. His options now are to either go after areas where he hasn’t cut substantially which is basically those things that benefit pensioners, raise taxes (fat chance of that!) or pull the one lever he hasn’t tried yet – the compulsory enforced retirement of public sector workers above the age of say, 60 (some countries have gone to this extreme already as part of their austerity). And before the many Brexiters who are in this age group start whining about how he can’t do that, why we have rights….oh you mean those rights in EU law you just voted against?

Half a million civil service are believed to be at risk. Bottom line, if you thought things were bad before they are about to get worse and its generally been those who voted for Brexit who will feel the pinch.

The generational gap

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Which brings us to the issue that there was a large generational gap in voting patterns. The old disproportionately voted for Brexit, while the young voted to stay in. Had the turn out of young people been higher (as it would have been had Cameron held the referendum at another time of year) the result could have been different.

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Some have likened this to a generational betrayal. As Jack Lennard puts it:

“This is a final middle-fingered salute to the young from the baby boomer generation. Not content with racking up insurmountable debt, not content with destroying any hopes of sustainable property prices or stable career paths, not content with enjoying the benefits of free education and generous pension schemes before burning down the ladder they climbed up, the baby boomers have given one last turd on the doorstep of the younger generation”

Or as Nicholas Barrett puts it:

“the younger generation has lost the right to live and work in 27 other countries. We will never know the full extent of the lost opportunities, friendships, marriages and experiences we will be denied. Freedom of movement was taken away by our parents, uncles, and grandparents in a parting blow to a generation that was already drowning in the debts of our predecessors”

Many of the younger generation are now stuck with the reality that Brexit will make it harder for them to get a job and harder to get on the property ladder (yes house prices might fall, but if you can’t get a mortgage or a job to pay for it, what difference does that make!). Inter-generational betrayal could well lead to anger and eventually inter-generational revenge (a scenario, a BBC “if” episode looked into a few years back, where the younger generation rebelled against the generous deal pensioners are getting and voted in politicians who withdrew many of these benefits).

Hence why if the government were to exercise the options I mentioned earlier (gut pensions, withdraw winter fuel payments and free TV licenses, force older workers into retirement) I don’t think there will be a lot of sympathy from the younger generations. And when pensioners start to struggle because a jump in inflation and a bear market has suddenly made it harder to fund their retirement, I suspect many will say, you made your bed now lie in it.

In short anyone of pension age, or approaching it (and you might be retiring a little earlier now than you thought!) who voted for Brexit has just voted for a more scary and unpredictable financial future.

Anti-Intellectualism and racism

We now live in a post-facts era. In the referendum campaign, many facts and certainties (i.e. that the £350 million a week claim was rubbish, that the pound would fall in value, that the UK’s credit rating would be cut, etc.) were simply ignored by leave voters, in favour of lies, myths and half baked bullshit. It is, as Dana Nuccitelli points out, not really surprising to learn that many Brexit voters also happen to be climate change deniers.

So Brexit does suggest the sort of rising anti-intellectualism that we’ve been seeing in America has now spread to the UK. Given how crucial science is to the UK economy, this is a very worrying development. Quite apart from the fact that UK universities and tech companies are highly dependant on EU research funding (as well as access to the EEA for collaborative research purposes), this could well represent a slide backwards for the UK. One could see the UK falling behind in the science race, which will of course eventually have a devastate economic effect on the country.

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And one of the post-referendum effects seems to be that its now okay to be openly racist in the UK. Many ethnic minorities have complained about an upsurge in racist abuse. Least we forget an MP was killed during the campaign. Unfortunately, I don’t think this will prove to be an isolated incident.

And coincidently, the view from abroad isn’t good. Many in the hostel’s in Norway whom I met from around the world took this referendum as being essentially an opinion poll on how racist Britain is. Given that 52% on a turn out of 70% voted leave, some are interpreting this as saying that 37% of British are racists. Britain’s reputation in the world has taken a severe beating as a result.

It worth watching what some of the US media are making of this, here’s Samatha Bea’s take on Brexit, the Daily Show’s and John Oliver’s.

Will German’s still buying Mini’s or Indians buy Jaguar cars they know to have been built by bigots? Will Beefeater Gin (which was being heavily marketed in Sweden while I was there) still be touting their Britishness when most people associate Britain with racism and bigotry? And will high tech firms set up in a country where their ethnic minority workers face racial harassment on the streets and bureaucratic racism from the state just because they had the nerve to come here and push money into the UK economy?

UK Trumped

Donald Trump, who showed all his keen political skills by arriving in the country at the worst possible time. It was a bit like a fan of KISS showing up to a concert the day after when a Baptist prayer group were renting the hall.

Trump did make some noises that he favoured Brexit and would offer the UK a favourable trade deal. Fat chance of that, Trump after all has flip-flopped his way through this whole campaign.

Trump is very much a protectionist and the idea that he would offer the UK a deal that will put his own business and the jobs of those voting for him at a disadvantage is clearly not going to happen. Once all of this is pointed out to him, he’d likely drag his feet on any deal and demand lots of concession, which (given how desperate the UK will be to get a deal) Westminster will have to concede on. He’ll probably insist on Windsor castle being named the Trump palace and putting a golf course across the tops of the cliff’s of Dover.

The UK’s best hope is that Clinton wins and wins big, with her party gaining a majority in Congress. This will cause her to focus on domestic politics and she’ll be anxious to avoid distractions. So she’ll toss the Brit’s a bone and perhaps given in on a few points. However anyone thinking that 60 million can get a better deal from 300 million Americans, than 450 million Europeans can get is clearly living in cloud cuckoo land.

And the UK will also now have to negotiate trade deals with other countries too, Japan, China, India, etc. In all cases they have the UK over a barrel. As noted, already there’s talk of Hinkley C being cancelled because of Brexit and of major infrastructure projects being put off as it is. Many UK jobs are dependant on foreign firms (increasingly owned by Asia) remaining in the UK. So its inevitable that the UK will not get anything like the deal it currently gets from these countries by being in the EU.

Indeed, its the WTO the UK first needs to square the circle with. Technically the UK will now have to join the WTO and its chief has already warned that’s not going to be straight forward, getting more difficult the further the UK drifts from a EEA style Norway model. Without WTO membership foreign trade becomes increasingly difficult.

A second vote?

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All of these things explains why several million have signed a petition calling for a 2nd vote. Already several Tories have suggested that there should be a 2nd referendum on the terms of any exit deal, while the lib dem leader is promising to try and stop Brexit and if that doesn’t work campaign on a platform of taking the UK back into the EU.

All of this raises the possibility of a 2nd EU referendum. Which given how dangerously flawed the last one was, its hardly fair that a racist minority (i.e. 37% of the electorate) should be allowed to cause so much damage to the lives of the remaining majority. However there is a rather significant obstacle to any talk of a 2nd vote. The EU itself.

As far as the EU is concerned out means out, as Junker has made very clear. Any idea of informal talks is being denied and the EU is putting increasing pressure on the UK to invoke article 50 and start the ball rolling on its EU exit. Quite simply put, the EU is fed up with pandering to the Brits, you’ve decided to leave, fine piss off then and don’t let the door hit you on the way out.

And keep in mind some eurocrats in Brussels have long favoured some sort of arrangement that demotes the UK to 2nd class status within the EU, so a push towards EEA membership is probably the next least worse option as they see it.

Also by shuffling Britain towards the exit door, the EU knows it makes it more likely that they will get an agreement favourable to them. The UK will have two years to negotiate its exit or risk being chucked out without any agreement, likely provoking a full blown economic crises and mass capital flight (if you thought events on Friday were bad, wait a while). As I pointed out before a future UK PM will come under enormous pressure at this point from the civil service, business, the military and allies to sign any such deal put in front of them by the EU, even if it ultimately leaves the UK worse off that it already is. So Brussels strategy here is sound.

So even in the best case scenario, e.g. the Tory party splits, an early election which a labour and lib dem coalition wins. Along with the pro-EU elements of the Tory party they hold an immediate 2nd referendum and win; I would still expect the EU to insist that the UK need to renegotiate its membership. This means that all of those “reforms” Cameron got will go (they were only there to appease the bigot brigade, which clearly didn’t work, so no point in keeping them) as will likely things like the British rebate. Of course if they are feeling particularly uncharitable they may insist the UK must now accept entry to the EU under the same terms and conditions of a new EU member state (i.e. all of the UK’s opt outs will go, we have to commit to joining the euro, etc.).

In short the UK just said no to the best deal we were ever going to get from Brussels. Any attempt to dither about leaving or re-enter the EU will mean accepting an agreement which leaves the UK worse off than it was before. There is basically no going back from this. If your a regret full leave voter, then your a moron and and idiot, do me a favour and stay away from ballot boxes.

Ignore it?

Another option is that parliament simply ignores the referendum. In theory its not legally binding, both houses (and arguably the Northern Ireland, Welsh and Scottish assemblies) have to approve it and its probable at least one of those will say no (actually all would vote no if given a free vote). In short, Parliament could treat this referendum as if someone just chucked a dead cat in their yard, get a shovel and throw it back over the fence.

However, I don’t think that’s a realistic option politically, nor do I think the EU, nor the markets would except this without some form of 2nd referendum or an early election.

The positives?

Which brings me to at least the one set of positives we can salvage from all of this. Brexit marks probably the end to all of the right’s lies and myths. Like a serial killer they’ve finally managed to act out their twisted fantasy and are now stuck with the consequences of that.

And the consequences are the buck stops here. Pretty much everything bad that happens over the next few years will be blamed (rightly or wrongly) on Brexit. Can’t get a job, or you’ve just lost the one you had, guess who’s fault that is? Not foreigners, not migrants or the EU, but the people like you who voted for Brexit! Your company can’t export overseas anymore because of a loss of free trade deals with the China and the US, guess whose to blame for that one? Your benefits cheque just got cut and you’re in dire financial straits, well you shouldn’t have voted leave then! You’re a pensioner and now can’t afford to heat your home or buy food anymore, well guess whose fault that is? Going abroad is now a pain in the ass because of all the passport controls and red tape, well I suppose you shouldn’t have voted for Brexit should you!

In essence Brexit amounts to the Bigot brigade breaking cover. And out in the open they are now exposed to certain day to day realities in a way they’ve previously managed to avoid. Because unfortunately reality has something of a pro-liberal and pro-progressive bias.