“Fed shrugs off Brexit”
Times Economics Editor Philip Aldrick has a story headlined “Rate rise on the cards as Fed shrugs off Brexit”. Admittedly this reflects confidence in the USA, rather than confidence in post-Brexit Britain. But remember that we had President Obama urging the UK to stay in the EU, and all sorts of international experts insisting that the uncertainty created by Brexit would affect the global economy. One more failed prediction from Project Fear.
Meantime – good news on the UK economy
We’ve had a series of major companies announcing big new investments in the UK – including several who had previously warned against Brexit. These include Siemens, GSK (on which I reported yesterday) and INEOS. We have Softbank’s enormous £24 billion bid for ARM . We expect EDF to confirm the go-ahead for the Hinkley Point nuclear power plant this week. (We in UKIP have reservations about Hinkley – but the EDF decision confirms confidence in the UK). The CEBR predicts strong house price growth despite Brexit.
And as icing on the cake, we heard yesterday that UK second quarter growth has come in at 0.6%, well ahead of expectation – despite the over-hyped “uncertainty” caused by the Brexit referendum. An interesting point: have you noticed that generally speaking all the good news on Brexit is based on hard fact, whereas all the doom-mongering is based on forecast and estimates? Those forecasts simply reflect the prejudices of the forecasters. And they’re wrong.
Typical Guardian pessimism: Right on cue, along comes the Guardian with a story of future problems, quoting Philip Hammond as predicting a slow-down in the economy. As I Tweeted yesterday. “I wish Philip Hammond would stop talking about the challenge of Brexit, and start talking about the opportunities”. Hammond has been hugely pessimistic about the Brexit outcome. Shades of Eeyore in Winnie the Pooh. Maybe somebody ate his thistles.
Article 50: “We never intended it to be used”
Ever since Lisbon, I’ve argued that Article 50 is a bit like “subsidiarity”. It’s a trap for the naïve and a lure for the unwary, a mere sop to eurosceptic opinion. But just as subsidiarity is constantly talked about but never happens (name me one single EU competence that has ever been handed back to member states under the rubric of subsidiarity), so Article 50 was mere window dressing. It enabled Brussels apologists to say “You sceptics should support the Lisbon Treaty because it gives you an exit door”. But in their worst nightmares they never expected that door to be opened.
So it was gratifying to read the report in the Indy that the author of Article 50, Giuiliano Amato, a former Prime Minister of Italy, who subsequently worked with the European Commission, admits that it was never meant to be invoked. We have it straight from the horde’s mouth, as it were.
“I wrote Article 50, so I know it well,” Mr Amato told a conference in Rome, according to Reuters. “My intention was that it should be a classic safety valve that was there, but never used. It is like having a fire extinguisher that should never have to be used. Instead, the fire happened.” The Article was explicitly intended to placate the British, and to prevent the British government from complaining that they had no way to leave the EU.
So, sorry about that, Mr. Amato. You gave a hostage to fortune, and the British people just called your bluff.
EU appoints Michel Barnier to head Brexit negotiations
Michel Barnier, a former EU Commissioner and French Foreign Minister, is described in several papers as “a man who resents Britain”. He is said to believe that he unfairly copped the blame for the French “NO” vote in the Constitutional referendum in 2005, and blames eurosceptics for the loss of his job. In 2010 the Telegraph described him as “The most dangerous man in Europe”. His appointment is said to represent the Commission’s determination to “play hardball” in the negotiations. But given that the UK imports over 800,000 German cars a year, Mr. Barnier may find that we have harder balls than he anticipates.
Sir Malcolm sees the bright side: Former Foreign Secretary Sir Malcolm Rifkind insists that Barnier’s negotiating agenda will be set by Merkel and Hollande, not Barnier.
Lembit Opik warns of “punishment”: Yesterday I debated the Brexit outcome with Lembit Opik (remember him?) on BBC Radio Essex, no less. He insists that the EU will have to “punish” Britain for Brexit – otherwise, he says, other countries will want to follow suit. This raises some interesting points. Should we ever have joined a club that takes a punitive approach to former members? If Britain succeeds after Brexit, and other countries choose to follow, doesn’t that show that the EU has outlived its usefulness? Wouldn’t we be better off with a European free trade area rather than a political union? But the more fundamental question is whether the EU has the means to punish us anyway. Given that we have a big trade deficit with the continent, any action Brussels takes will hurt the EU a great deal more than it will hurt us. And in the current parlous state of the EU economies, they just can’t afford it. As I asked Lembit, does Angela Merkel really want to see thousands of unemployed German auto workers in Stuttgart and Munich in an election year? I think not.
Terrorism worries in Britain
The Mail headlines “2000 terrorist suspects in the UK” (as I reported yesterday) “but only one under curfew”. Easy to state the problem – but maybe less easy to solve.
Islamic hate books found in prisons: The Times reports that Islamic hate books have been found in British prisons, despite being banned. Well I suppose if they can smuggle drugs and mobile phones into prison, they can smuggle books as well. But I suspect that there are few credible sanctions that prison authorities can apply to Islamic prisoners. The Express lays the blame in Imams.
Hungary taunts Merkel: Hungary’s Prime Minister Viktor Orban has launched an astonishingly sharp attack on Angela Merkel and the EU immigration emergency, saying “Our problem is in Brussels, not in Mecca”. But the Mail reports that German police are starting to take a tougher line against suspected jihadists:
A blow to Sturgeon
A pro-Independence think tank in Scotland has claimed that the country would need reserves of at least £10 billion to back an independent currency. Tough call.