Dear Prime Minister

President Macron has been to Washington to set out the European position on Ukraine. There is little you can add to that. Europe is divided, with several key military states refusing to join any peacekeeping force. Germany and the UK have led the provision of money  and weapons this side of the Atlantic , with France, Italy and Spain far less generous. This remains a sore point with President Trump who thinks the European members of NATO should have been much more forthcoming. Trying to defend their inactions is not going to help.

President Trump wants some early wins. He wishes to strengthen NATO with bigger non US forces. You should tell him new legal advice has come to light showing that the ICJ cannot decide a case against the UK on the Chagos islands as our Treaty Agreement held Commonwealth matters outside their remit. Given this you will not be giving the islands away and the US base is secure. You will allocate the money Mauritius wanted for the lease to more defence spending on improved capacity.

The President wants to get tariffs on US exports down and is very critical of the EU imposing  tariffs on 73% of all the WTO categories of goods. It is true since Brexit the UK has taken this down to 53% but some high tariffs on food, cars and other items remain. You should offer to cancel all tariffs where the US will match us, giving both sides a big win.

The meeting should be mainly about trade. The UK will not be in the negotiations between Ukraine, US and Russia, which need to be kept tight to have more chance of success. Offering the President free trade, a secure naval base, higher UK defence spending and an early State visit could bring a good result. Lecturing him on Ukraine and giving away Chagos will mean bad transatlantic relations.

 

Yours

Rt Hon Sir John Redwood

 

 

 

 

 

 

 

Rather than arguing about 2.3% or 2.5% the MOD should decide what extra  capabilities we need to defend these islands and help our allies. My suggested list is

1. Improved Iron Dome style surveillance and interception capabilities for the whole UK against incoming  missiles and drones

2. Expanded drone and missile capabilities and stocks including hypersonics

3. An army of 100,000 deployable troops

4. Further destroyers, frigates and submarines to ensure we can deploy two carrier led   groups, with support vessels, all built in UK yards

5. Sufficient strike aircraft for home defence, overseas bases and carriers.

How to pay?

Redirect money from Bank of England excess losses, (£15 bn a year )recovered public sector productivity ( £30 bn a year) and delaying carbon capture and storage (£19 bn)

These savings also can provide for necessary lower taxes and a modest reduction in borrowing.

 

 

 

Here’s a way for Council candidates to improve their chances of election.

Offer lower Council tax. Why do so many candidates compete to spend more and put it up? Why do Councils usually put it up by the maximum allowed?

Offer to cut out all those annoying expenditures that make  our lives worse. End Council “investments” in property and utilities.

Cancel all those anti driver road schemes.

Sell Council trading activities, empty properties and surplus land.

Have a plan to slim down bureaucracy with staff freezes and slimmer organisations.

Cut out many of the woke projects.

Use competitive contractors to deliver more of the service

 

The German economy has failed to grow for two years. Its once dominant car industry is reporting falling sales and sharply declining  profits.They have spent huge sums on designing and launching  battery car models, only to find customers do not want them. That was entirely predictable.

Mercedes only sold 12% of its vehicles as all electric. They now say they will make more of the petrol and diesel cars people want to buy. No wonder profits are down. Misallocated capital to battery cars has hit returns.

The whole German economy is suffering from trying to get off dependence on Russian gas, from premature closure of all nuclear power and the search for buyers for the products of the net zero revolution.

The tragedy of these decisions is that they also fail in their own terms. Importing LNG instead of producing piped gas generates far more CO 2. Destroying petrol car factories prematurely and building battery car ones boosts CO 2. Plugging a battery car or heat pump into a grid using gas or coal fired electricity adds to CO 2. Why do Net Zero enthusiasts refuse to look at the total world impact of what they are doing? Why are China and the USA, the largest CO 2 producers, still increasing?

The net zero revolution can only work when they have low carbon products people want to buy, and far more renewable power than current generators and grid systems can deliver.If renewable power is so much cheaper then investors will want to install more.

It is odd that the western governing elites press hard for peace in Gaza rightly pointing to the deaths and destruction in the war, yet do not  press for peace in Ukraine where there are also terrible deaths and destruction of property.

President Trump wants peace in both places. He is accused of letting Russia get too many wins in Ukraine and of being too pro Israel in the Middle East. In both cases the question is where is the better answer which can get us to peace? Secretary Rubio is seeking to get a path in Gaza to peace that the leading Arab states support and will back.

In Ukraine the President says after 3 years of bruising and expensive war Ukraine has lost substantial land and has suffered bad damage to its property and economy. He does not see Ukraine being able to evict Russia by force and has no more intention than Biden of using US and NATO forces to do the job. Nor does he see Russia being able to defeat Ukraine and take the whole country.He therefore says to both sides that a settlement related to the current front lines is a better outcome than fighting on with more loss.

Many European governments disagree strongly. They have not put forward any alternative plan. They have been slow to provide modern and effective weapons to Ukraine.  They have continued to buy plenty of Russian LNG whilst US led sanctions were trying to undermine the Russian economy. They failed to hit the target for the delivery of shells. They say they want to be in the room with Trump and Putin, but if they are serious in thinking Ukraine should  join NATO and should not surrender any land Putin would not stay in the room.

They failed to coordinate a position when Macron convened an informal meeting. No formal EU meeting has agreed a line. They discussed how to police a peace settlement along the lines of the settlement Putin and Trump might  agree which they say they do not want. France, Sweden and non EU UK said they would send troops but Poland and Germany the largest military powers near Ukraine refused.

They want Ukraine to become a Nato member after the peace, but as the US is against  and is the dominant partner in NATO this cannot happen. Russia does not want another NATO state on its doorstep as it does  not  grasp that NATO is a defensive alliance that would not threaten it unless Russia was invading a NATO country.

If Europe is serious about helping Ukraine to fight on and improve its bargaining position then it has to set out how it can replace all the lost money and military might of the US which means doubling its current contribution. It would need to increase that doubled contribution as the combined generosity of US and Europe has been insufficient. I don’t see Europe being able or willing to do that.

 

11 am All Souls High Street Oxford  Friday 21 February

 

Zoom 968 9416 0680

I warned before the last Bank of England rate cut that inflation was going up this yea. The Bank should take its anti inflation duty more seriously. The CPI is up 3%, 50% over target. It will get close to 4% later this year.

The government is causing a lot of the inflation. Bus fares up from cancelling a subsidy. Rail fares to go up to help pay for a big inflation busting pay award by a nationalised industry. Managed energy prices up. Services going up thanks to big increase in employment costs from the jobs tax. Regulated  Water bills up massively. VAT on school fees. Housing costs up 8% thanks to attacks on landlords and restricted supply. Food costs up as family farm businesses threatened with business killing tax rises.

Stagflation is well set in. Around  Zero growth for the last half year and 3% inflation. Last summer we had topped the G 7 growth league for the first half of the year and inflation was 2%

 

In the last century the UK twice was dragged into world wars. The small armies of peacetime were soon retreating and subject to huge loss, with the need to recruit, train and equip much larger armies after the war began.In each war innovation and greatly expanded industrial output transformed our force, with new tanks, planes, and types of munition.

To fight those wars we still had capacity to make steel, explosives and other essentials  and intellectual property to make competitive planes, ships and weapons. By 1943 we were making 26,000 planes a year despite bombing of factories and sinking of imports . Today we have run down our steel, chemicals and other essential raw materials for defence. We buy planes and weapon systems that need components and sometimes permissions from overseas. In the two world wars our enemy sought to blockage us, sinking many of the ships bringing imports. An island nation needs to be able to make and grow things for ourselves to make it easier to survive a war.

The National Security Council needs to do more work on ensuring our defence spending buys domestic capacity and the rights to make the weapon systems here. The MOD needs to overhaul its procurement. There have been too many budget overruns and delays, too many one offs and variations after the programme has started. We need to able to make more standard guns and ammunition, more drones and good value missiles.

 

When I studied history I was made to read a lot of European history, with UK syllabuses largely or wholly ignoring the histories of the USA and Asia. It was a depressing study to read of a continent rent between Catholics and Protestants for four centuries and between communists and fascists for a fifth. The history was disfigured by the successive imperial ambitions with planned invasions of Britain by Italy, the Norsemen, Spain, the Holy Roman Empire, France and  Germany , as successive efforts were made to create a Europe united by conquest and suppression.

I came away with the realisation that England, later the UK, had suffered badly from its interventions in Europe. We had been invaded and put into slavery by the Italians when they were called Romans. We had been pillaged and occupied by Scandinavians called Vikings or Norsemen. We had been subjugated with lands and businesses stolen by the French after the Norman invasion as they enforced feudal serfdom. We had in the sixteenth century to  defeat the mighty Spanish empire as they launched a major invasion. In the eighteenth and early nineteenth centuries we needed to defeat another big French attempt to subjugate us. Twice in the twentieth century we had to defeat German efforts at conquest.

Part of the reason I opposed our membership of the EEC, later the EU, was my knowledge that attempts at European Union had always turned out badly in the past. Introducing a European army was unlikely to make a more peaceful or secure Europe. The Holy Roman Empire superimposed above the German states had not brought stability,  but did become a fighting unit in its own interests. The EU has more now calling for an EU army. The EU has made moves  to common weapons systems and procurement, undertakes common actions militarily and wishes to extend its defence competencies.

The UK has always been generous to the continent. Our predecessors spilt much blood and treasure stopping the spanish conquest of the Netherlands and other Protestant states. They did much to prevent Napoleon dominating most of Europe. The UK stood alone against Germany in 1940 before the US entered the war. In the EU we made a large financial contribution and opened up our market to their exports, running a huge deficit, as their market opening was one sided.They would not open their services markets to help us.

Today the US has rightly challenged European members of NATO and the EU to do more for our own defence. The UK should be no part of a common defence of the EU and  its borders. As they expand eastwards they must provide the forces for their own security.  We should meet our NATO obligations to fellow NATO members just as we need their support and guarantee. It is feasible to keep the USA in NATO as long as we and other members do a bit more to provide both military and industrial capacity to resist and deter invasion. It is not feasible to expect the US to provide defence cover for an expanding EU as they add non NATO members.

The EU was busily influencing Ukrainian opinion and politics  , encouraging a pro Western line working towards EU membership. The 2014 revolution and  change of Ukrainian leadership forced out a more pro Russian President and brought in a pro EU President. Putin seized  the Crimea , claiming it was a very pro Russian region that should never have left Russia.

This left the south eastern provinces where there was also a larger pro Russian population. Civil war broke out with Russians encouraging secessionists. The pattern of behaviour was similar to Russia’s action in Georgia  to detach South Ossetia and Abkhazia . In Moldova Russia seeks to control Transnistria. Belorus is governed by allies of Putin. To the west this is a war of  Russian expansion, as Putin seeks to reunite old parts of the USSR. He claims he is supporting and assisting populations  who wish to be independent of Georgia or Ukraine or Moldova as they look towards the EU but uses force to back up his claims. The West sees Putin as an aggressor seeking to gain territory by violent conquest. Whilst they wish to stop him they have understandably not wanted to go to war themselves with Russia. Ukraine has been fighting the war whilst trying to get more help from the US  and EU.

To Russia the Russian speaking areas of Ukraine should belong to Moscow. They claim there are people in those parts of Ukraine especially in Crimea that want to be governed by Russia. They see it as a war against EU expansion  with the EU offering membership to Ukraine, Moldova, Georgia, to push its borders closer to Russia. Russia does not distinguish between expanding borders by military action and expanding  them by government decisions in the way the West does.

It is most important if there is a peace Treaty or ceasefire in Ukraine with  the current front lines as a new border that the UK leave the task of policing that border to the EU.It becomes an EU  border as soon as Ukraine membership of the Union is confirmed.