Author: johnredwood

The British Retail Consortium reported a few days ago that March retail sales overall rose by 2.3% year on year.  They said “This is above the 3 months and 12 months moving averages of 1.8% and 1.9% respectively but is positively distorted by the timing of Easter.”

Today’s more detailed news is that sales on the High Street fell by 8.6%, with a much smaller decline in shopping centres and good rises on line. None of this has anything to do with Brexit. There is a strong trend for people to buy more on line and less in shops, probably speeded up in March by the dreadful weather.  Food sales were particularly strong In March , with a rise of 5.3%.

Some people like to report part of the retail sales story, usually quoting so called like for like in shops, to give a gloomy answer.

On Thursday evening I gave a lecture at Middlesex University about the long period of the UK’s membership of what became the European Union, and why it led so many UK voters to conclude we will be better off out.

Two  things  were most  neglected in the Referendum thanks to the dominance of the Remain campaign and the Establishment behind it in driving the media agenda. These  were the economic damage that membership did  to the UK, and the plans of the EU to move onto political as well as full monetary and economic union. I will consider these today and in later posts.

We need to examine  the EU’s love of austerity policies. They are embedded in the Maastricht Treaty, and apply to the UK as well as to Euro members, though without the same enforcement mechanisms for us as for a  Euro member. Maastricht says that  no state should borrow more than 3% of GDP in any year, and all states should  bring their state debts down to 60% of GDP. This latter requirement forces a country like Greece to try to run a budget surplus, and lies behind Chancellor Osborne’s wish to repay debt in the UK. Each year the Treasury reports on our public finances against the Maastricht requirements, and each year we have a Parliamentary debate about our progress or lack of it in hitting these targets.

Our membership of the EC began badly with a deep recession in the middle 1970s. Whilst this was not directly caused by our EEC membership, it did lead some  people in the 1975 referendum to doubt there would be economic gains from membership. Our presence in the EC did not begin with a surge of new business from joining the Customs Union.  In the first decade the removal of all tariffs from manufactures where we were relatively weak allowed continental countries led by Germany  to boost their exports to us greatly, helping destroy jobs and factories here at home. Conversely a lack of market opening in services where we were stronger meant we ran perpetual large balance of payments deficits.

The worst impact of the EU on us came from their requirement that we join the Exchange Rate Mechanism. This gave us a boom/bust nightmare – entirely predictable as I wrote  in a pamphlet prior to the event. We lost 5% of National Income and Output from the slump it caused. The 2016 referendum was our first chance to vote on the EU’s role in that disaster. The UK government that was the agent of it had long since perished at the ballot box as electors removed the EU’s agent of recession in the 1997 election.

The austerity policies in Greece, Ireland, Spain and elsewhere have been of altogether much greater magnitude than in the UK where we have broken the rules by more and for longer on debt and deficit. In Greece there have been endless rounds of cuts including large cash cuts in pay and pensions which we in the UK have rightly never considered. These policies have been deeply damaging to their economies, resulting in  high unemployment and excessively high youth unemployment.

I have deleted a number of posts today, as I am short of time. I have deleted some without reading because they were very  long, and some which are  very repetitious in nature, as well as deleting many with attached links to sites I have not read.

I trust tomorrow when Parliament meets the government will update us on its thinking on Syria and give MPs every opportunity to examine the position now reached.

I assume the limited action the UK  took with allies early on Saturday morning is the end of the military intervention  planned following the use of chemical weapons in Syria. I stressed before the event that we should not fly our jets into Syrian airspace, run the risk of killing Russian personnel and damaging Russian equipment, and risking  killing civilians. It appears we have avoided all of those dangers. It is now important we show we do not intend to escalate from here. I am glad the PM did tell us she has no plan to intervene in the civil war or seek regime change as those options would require considerable and sustained force and be full of risk.

Labour will doubtless wish to explore the legal base for the action.

Many MPs will want to know how successful it was in destroying chemical weapons production facilities and chemical weapons stocks, the stated targets. We await the full Intelligence evaluation and assume Russian claims to have shot down most of the missiles are false. We will also wish to be reassured that attacking chemical weapons stocks did not lead to damaging release of any of the chemicals, or to the death or injury of people on the ground.

It will also be interesting to hear the governments evaluation of whether this will either prevent or deter future use of these munitions by the Syrian regime. Has the attack crippled their capacity to make and use these weapons? Or did it do such damage that they will conclude it is not a good idea to do it again?

There should  be no escalation of this action and a careful consideration of the results of this mission.

We constantly hear these days that there is a rules based international order which all decent states follow. Russia is condemned for not following these same rules.

Those who think like this usually divide the world up into a majority of states who follow these rules, and a minority of rogue states like North Korea who pose problems for the rest. When it is one of the world’s larger military powers who has greater diplomatic reach, some world support and a seat on the UN Security Council that does not follow the world order this analysis has its limitations.

I am no apologist for Russia, and understand the ruthless pursuit of Russian interests by that state can lead to unacceptable conduct. I condemn atrocities and illegal acts whichever state carries them out when they are reported and proved.

The truth is there is no one set of rules, no single world order that is codified in many areas of government activity which  every state should obey.  Within NATO and the advanced west there are varying rules of law.  The USA has its own set of laws and legal constraints on the actions of its President and senior officials. The EU has another set of laws and legal requirements on its member states. The EU will not accept all the US rules, and will certainly not accept US jurisdiction, nor will the USA of course accept EU rules and control.

The West does come together in some world bodies and helps shape a global approach. There are world trade rules supervised by the WTO which all members accept, though the USA currently feels those rules are not fairly administered with regards to China and Germany. There are important conventions on nuclear and chemical weapons which most countries have signed. North Korea  becoming a nuclear power and alleged use of chemical weapons in Syria causes problems under these global rules. As the current disputes reveal, the countries accused of breaking world rules often argue they have not. China and Germany pose as supporters of a world free trade order, whilst the USA cites evidence that they are not. The West rightly condemns chemical attacks in Syria, only to be told by Russia that no such attack has happened.

The main countries and blocs appeal to world rules when it suits them, and seek to interpret them in directions which fit with their national interests. Russia clearly plays by different rules to the West in several respects. In Syria it will accept more deaths as the regime seeks to  restore its control over the country, as Russia judges an Assad government to be the least bad outcome. The West is against both ISIS and Assad,  but lacks the power and commitment to enforce a different government on that country, whilst  condemning  the many deaths the current civil war is causing.

Those who protest most about the need to create and follow a rules based system need to be punctilious themselves to obey it. Any Western military intervention in Syria today will need a legal base, made more difficult by Russia’s veto of any UN Resolution which could directly support action. The UN is a world body which comes closest to providing a rules based system for the conduct of diplomacy and where unavoidable to regulate  the use of force between states. That body cannot have a clear single view or straightforward rule where the Security Council is divided and where a veto has been wielded.

On Wednesday morning the Today programme had the good idea of going to Germany to find out what they are thinking about the EU and Brexit. A few patsy interviews later we were little the wiser. There was no cross examination of how Germany is changing, with the Eurosceptic AFD now the official Opposition and the CSU moving sharply in an anti migrant direction. There was no proper examination of what the German government will now do post Brexit in response to Macron’s wish to push ahead with political Union and a common budget. There was no discussion at all about the 900 billion Euros Germany is lending the weaker members of the zone at zero interest through the ECB. I would like to have heard what Germany thinks about the pace and style of more integration, how they wish to change the budget after our departure and above all how they will tackle the need for more transfers around the Euro area to help the struggling members with high unemployment.

Instead the BBC was keen to get a few German interviewees to tell the UK what we should expect from Brexit, and keen to play up the latest approach of some senior Germans that it is such a pity the UK is leaving so they should now respond more positively to Mr Cameron’s requests for renegotiation! I find it bizarre that some intelligent Germans seem to think that maybe a concession or two on freedom of movement, and some opt out or emergency brake on benefit rules will mean the UK then changes its mind and stays in. They had their chance to keep us in by being positive about the Cameron renegotiation. Many of us thought Mr Cameron asked for too little, and clearly got a lot less even than he dared ask for. Offering more of the too little he wanted is not going to change anything. The BBC seemed pleased that maybe there will be an offer of tariff free trade after all, as if that was some surprise. Of course Germany wants tariff free trade in goods, given her huge surplus. Whether the EU as a whole can make a sensible offer on trade remains to be seen. Germany should work on the Commission. The BBC was also keen to highlight  those Germans who say that the Transition period cannot be taken for granted as they sought to help Germany squeeze more concessions from the UK to secure a Transition many of us do not want.

It was predictable to hear the Germans say that in the case of us leaving the customs union and single market, as we have said we will do, there was scope to keep us in after all despite early EU rhetoric that of course you cannot be in them if you are out of the EU. Again that boat has sailed. Leave voters voted in the knowledge we would be leaving the single market and customs union, and the EU confirmed the logic of that in all their comments. It was also amusing to learn that maybe passports should be available for financial services, as of course German companies would like them into London, when the UK had ruled them out! It just goes to show that if the UK says No firmly on items Germany is quite keen to make an offer we might still refuse.

The NATO Allies are sure that the Syrian regime unleashed chemical weapons against the civilian population and rebel fighters. Russia denies it, and Inspectors may go in to see for themselves what evidence remains from the violence some days later. President Obama made the use of chemical ordnance a red line Assad should not cross, but then decided not to take action when he did. President Trump also made it a red line, and followed a previous case of presumed chemical weapon use with a single surgical strike. This has not deterred the latest incident.

The West is now seeking to establish good evidence of what it believes has taken place, and is considering its military options. These are limited and constrained by circumstance, and by the history of the West leaving much of the Syrian theatre to a combination of Assad and Russian power to deal with Isis. No-one can credibly claim that killing more Syrians is the missing policy in this dreadful conflict that could start to put things right. There have been all too many deaths already, and the West will not wish to add to the death toll of civilians. Taking on the Assad regime and its troops is an unlikely mission, as they are strong on the ground, battle hardened, and understand the people and the terrain. It would entail a huge effort by the West including an invasion. When tried elsewhere the problem has been how to create a replacement government that is stable, has authority and is democratic in such circumstances. Supporting the rebel forces against Assad with air power would be a dangerous mission pitting the West against Russia who would continue to support Assad. There is no evidence that there is a well armed and substantial rebel force with a chance of winning against Assad and Russia who could also create a stable and good government in the end.

This seems to leave Mr Trump with using missiles and smart bombs to destroy known military installations, weapons dumps and any chemical weapons facilities that they have identified. Even this will require great precision and care not to harm people who live near to these facilities, and to deal with any attempt by the regime to organise actual or fake damage to release as bad news following any attacks. Mr Trump may like to involve France and the UK in any such attack to show this is a wider Western alliance action, undertaken by three members of the UN Security Council. It cannot however be done in the name of the UN as Russia has vetoed a proposed resolution on this Syrian atrocity.

NATO needs to ensure that if it does fly missions by fast jets, or send in drones or missiles, it does so without creating a military exchange with Russia. The military airspace over Syria is often used by Syrian and Russian planes. Events can happen quickly when fast jets from Russia and NATO are seeking to use limited airspace for different purposes, and when the fast jets can close on each other with each flying at speeds well in excess of 1000 miles an hour.

What should the UK do? It should of course work with our NATO allies. With them we have condemned any use of chemical weapons, and with them we can examine the options. I also trust the UK will be a sane voice wanting us to act effectively where we can, rather than demanding action to reveal our anger even if there is no action that is likely to have a good outcome.