Friday 30 August 2013

Cameron: Eden: Suez

History corner:  a patrician Etonian Prime Minister essays a Middle East adventure against a dictator.  The PM fails to make sure of sufficient support, and has the rug pulled out from under him.

We all know what happened to Eden.

Interesting to watch Miliband and Alexander making merciless partisan capital out of last night's debacle.  Well, they've had a miserable summer.  (Almost made Hammond look statesmanlike by comparison on Newsnight, which is quite an achievement.)  Gloves off now on the domestic front, for sure.

Miliband needs to be careful.  These are fraught times, and Grown-Up's games are being played.  If anyone ever wondered what the UK does in Cyprus, they may find out shortly, Commons vote or no Commons vote.  Cyprus is 95% of what the US wants from the UK. Israel may have a little message for Miliband too, in due course. 

Now - who is going to play Macmillan to Cameron's Eden ?  Someone flamboyant, unscrupulous, ambitious ...  whoever could that be ?


Thursday 29 August 2013

Merchants of Doom

A cheerful banner across the Telegraph's online Finance page this morning.

Just when you thought it was safe ... emerging market rout ... budget disaster ... cannot save Greece ... lose control of inflation ... mass unemployment will return ... world slump

Oil up, Gold up ... quite like old times.


Wednesday 28 August 2013

The Blair shadow

The Americans went through a crisis in the 1960's and 70's. A very real, nation destroying, culture changing, society bending change. The death of JFK. Martin Luther King. The Vietnam war. The oil crisis. Bad as all this was Watergate was the final straw for many. Not only had the politicians failed to deliver..They were lying, cheating, self serving, money grabbing crooks too. If you couldn't trust the word of the President, Then who's could you trust?

For the UK, escaping the Vietnam war altogether thanks to a heroic Harold Wilson meant we had no need to examine our own politicians too closely. They were all pretty ineffective was all. Not until the same, less heroic, pipe smoking PM assured the nation that the pound in their pocket was unaffected by devaluation did people begin to doubt the words of the elected leader.  And I would argue that it was only under Tony Blair that UK citizens really begin to not just distrust their leaders but to actually disbelieve them. People began ignoring official advice or information and believing their own sourced information, however unlikely and however poorly researched, instead.

People had been steadily less impressed by their leaders for a long time. TV news. A new realism. Reduced censorship Sexual revolution..loosened morality.. whatever..
But New labour's soviet style spin factory, where every day was sunny and every citizen joyful, bred doubt and cynicism. For much like Stalin's Red Square parade where the NKVD had pre-recorded themselves ecstatically cheering and on the day played that through loudspeakers, and the same thousand upon thousand NKVD men guarded the square with empty holsters and ammunition free rifles in case they weren't as ecstatic as they claimed, the citizen's eyes and their ears were hearing and seeing different stories.

Under New Labour crime fell repeatedly. Children were better educated than ever. Sickness was a whisker away from being cured. Cafe culture drinking was making late night drinkers politer and ended binge drinking. Immigration was only an issue for racists and only about six Eastern Europeans had come into the country anyway. 
Rosy, rosy rosy. In fact, up until 9/11 the biggest problem Blair faced had been what to do about rich people wanting to continue hunting foxes from horseback.

A chilling thing occurred just before 9/11. The MMR scandal showed that thousands..hundreds of thousands.. of people refused to believe their government. The  Labour government repeatedly claimed that the jab was safe. Had always been safe. That the Lancet report linking it to autism was as bogus as the Millennium bug had been. And they were right.

Few parents listened. And when PM Blair refused to say if his son had had the jab the disobedience to government health instructions got a lot worse.

Blair was only following SOP for the PM's office.. Never give out personal or medical information to the Press. Only this time the fact he said nothing led many to draw their own negative conclusions and to foolishly take their own action, or lack of action that has had repercussions down to today.

When the Labour government committed the UK to war in Afghanistan, there were dissenters, but 65% of people supported the war.
Iraq was closer. 53% were in favour in 2003 but those against were marching. Tony Blair was in real danger of having to resign. So he made his powerful commons speeches , the claim that we faced attack and the 45 minutes to destruction and the dodgy dossier.
Even at the time it didn't sound like enough reason to go to war. Especially as we were already fighting one. But, Tony was the boss. He said it was necessary and he had access to secrets that we didn't so..benefit of the doubt.. and a majority agreed with him.

Unluckily, as we now know, the war was based on bogus reports and faulty intelligence. Wishful thinking and truly terrible aftermath planning, a lousy President. No UN or Turkish cooperation  meant it all went wrong very quickly. 

The spin that went with the war to convince a fairly sceptical public and a very sceptical media put the stake into the honesty heart of politicians for a generation. The subsequent MPs expenses scandal was just icing on a cake that we had already seen.

All politicians are liars.

So when the Prime Minister says that Assad deployed chemical weapons, few believe him. When the weapons inspectors say it was 95% likely the Syrian Army used nerve agents, the public don't listen. 
When William Hague sets out a strategy for a few Tomahawk missiles to be lobbed at the Palace, people see preparations for a full scale military deployment using British troops. Even though at the very most only a handful of British special forces troops ever walked on Libyan soil during the entire conflict, people will say the whole thing had been engineered by the USA to seize the oil. 
- Despite Obama being a virtual saint and despite Obama and America showing no appetite for action in any of the many recent flashpoints of the Arab spring. The American's wouldn't even join France and UK in Libya and they had to be dragged in.

All politicians are liars. The evidence of our eyes and ears says maybe not all the time, surely? We don't care. All politicians are liars. We didn't win in Iraq or Afghanistan and as a nation we have no wish to try again somewhere else. 66% are against any involvement in Syria- That was a poll 6 months ago before it even looked likely. It will probably be higher by now.

So no matter how much David Cameron tries to explain that the red line has been crossed. That the UN agrees it has been crossed and to maintain any credibility some action, even gesture politics style Clintonesque, feeble desert missile bombing action must be taken. No matter how much he promises there will be no escalation and that the UK has no intention of forming a coalition for war, most won't believe him. He can say what he likes but he's talking to people who have made up their minds. The fact he was right about Libya and the doom sayers were wrong won't matter a jot.

All politicians are liars.

The shadow of Tony Blair will be very long and very dark for a good while yet.

Syrian misadventure is not about resources

Whenever it comes to war in the Middle East, which sadly has been the case fro many years now, indeed all of my adult life, the main accusation that comes from the left-wing is that the US and UK are only in it for the money.

Somehow some unsubstantiated claim is made that it is all about oil and security of energy prices that makes the West take actions to target and murder women and children. I have never taken this theory very seriously as no evidence is ever truly thrown up in its defence. Perhaps the one time it could have been true in 1991 and the First Gulf War, which did see prices drop, was the one time the whole international community was in harmony about the reasons and justification for the war!

Nevertheless, in Parliament today or tomorrow the likes of Diane Abbott will stand up and say this is all about oil or gas. Syria produced a mere 385,000 barrels of oil a day - it is hardly a blip on the middle eastern radar of oil producing countries; Iraq is trying to increase production by more than this each year. gas fields of 9 TCF are proven but not yet exploited. Again 9TCF is not tiny, but hardly competes with American shale gas. And this is the point, America may soon become a net energy exporter, the proposition that it would go to war with Syria to secure oil and gas supplies therefore moves beyond even the fanciful to the downright deranged. The USA and the UK could lose more by antagonising Russia and its supplies that it could ever gain in Syria. So let's hope in the debate to come that this hoary old chestnut is not raised.

Finally, don't read the above as a blessing for intervention, in a nasty civil war which is symptomatic of a wider Islamic civil war between Sunni/Shia and Wahhabi/Moderate visions of society I doubt we can make any difference. I would also wait until there is real proof Asad did this as the suspicion must be it was the rebels who have far more to lose and have admitted using chemical weapons in the recent past. I don't see at the moment what we hope to achieve by intervention.

Monday 26 August 2013

Shale: Another Nail in Osborne's Coffin

Balcombe Blame Rests Here
Or rather, the coffin of his reputation as a strategist.

Oh yes, it's been dead awhile, stone dead.  But by my reckoning, his screw-up on shale is almost up there with the fatal boundary-change abortion.

In both cases, Master George the master-strategist seems to have identified clearly enough the paramount significance of a particular issue.  But instead of following through, of giving it the undivided attention and planning and execution it merits (being An Issue Of Paramount Significance, yeah ?), he farts in its general direction and assumes that plaudits are in order for his spotting, and farting at, the obvious.  But a real strategist understands that strategic insight is empty without genuine, unremitting, practical application to the task of figuring out everything that follows, in grinding, boring detail - and actual implementation of the needful.  Whatever it takes.  With no loose ends.  Because, hey, it's of Paramount Significance.

We know how the boundary changes ended: so what happened with shale ?  When the initial Cuadrilla discovery was announced, we wrote here: This Is The Big One.   Others (e.g. Mr Worstall) followed our lead, and soon it was recognised by all and sundry. See, George, it is really obvious (& let me quickly add that C@W was by no means alone in trumpeting the matter).  George duly cottoned on too and started running his own energy policy - hatching tax breaks (unnecessary) and a streamlined permitting regime (stupid, at least in the way it's been done), with a bit of gratuitous green-baiting (Juvenile George's stock-in-trade).

But what else obviously follows from the obvious significance of shale ?  Why yes: every Green and Red and general unwashed malcontent and transgressionist across Europe would realise that shale gas (if actually found here) could be the death-knell of their various stone-age / statist dreams.  Accordingly, they would be out in force to try to prevent drilling, with a lot more chance of drawing the crowds than (say) the rather recondite NoDashForGas sit-in at West Burton.  Oh yes, this too was entirely obvious - we predicted it here last year - and is a major vulnerability of the whole UK shale gas prospect.

With the Battle of Balcombe rumbling on, there is no need to rehearse just how far short of a strategy we are: and I unhesitatingly blame Osborne.  There is nothing good to be had from going abut the job clumsily and pissing off conservative Middle England in the process.

Is all lost ?  Well, if this were Germany we'd be in really big trouble, because their greens (and the old superannuated Atomkraft-Nein-Danke brigade, now in well-heeled retirement with time on their hands and misty recollections of their glory-days to perpetuate) have serious stamina, as witness the very long-running Battle of Stuttgart Station.

But our homegrown greens are a little less committed.  I maintain that the UK shale programme is vulnerable to the antis, but there is certainly an optimistic scenario.  Those with long memories will recall the massive pro-coal-mining demonstrations in the early 1990's, when Michael Heseltine (sic) was at the DTI and allowing large-scale pit closures to take place.  A short moratorium, a general return to the sofa to watch whatever was the compelling soap of the day; and after a couple of months all was forgotten and the pits closed as planned.  Likewise in the first year of the NuLab government, some more pit closures were announced: cue massive popular hostility to the Dash For Gas (yes, even then - and that was technically the second D-F-G; the current one is the third).  And what did young Peter Mandelson do then ? (yep, he was at the DTI in 1997).  Why - another moratorium ! - this time on new gas-fired power plant permits.  And after the usual short interval ... well, you know the rest.

So there's at least a chance the great unwashed just pack up and go home**.  Therefore, if there is a decent strategist somewhere in Whitehall (and I very much think there is) there is at least the possibility of getting this show back on the road.  There is, after all, no great rush.

If a real strategist takes charge, there is one final optimistic precedent worth noting.  In the first Thatcher government a truly strategic attack on the NUM was being hatched under a properly thought-out, comprehensive plan (which embraced such details as building coal stocks to unprecedented levels, uprating Felixstowe for coal imports, building the A14 to get them to the Midlands by road, and installing an infrastructure for coordinating the Police nationally.  See, George, that's what a real strategy looks like.)  In 1981, before all this was complete the NUM went on strike for a pay rise.  So Thatcher ordered a tactical retreat - looked like a horrible climb-down at the time - reculer pour mieux sauter, until things were good and ready.  Well, you know the rest.

So all is not lost.  But Osborne ... his failings are inexcusable.  Is there really not a better candidate for Chancellor on the coalition benches ?  That's another job where strategy is at a premium, n'est-ce pas ?


** having a few spare hours last week, I monitored the tweeting on events at Balcombe.  Somewhat to my surprise, having been at frenetic and very high-volume levels all week, it fell off dramatically after lunchtime on Friday.  Does this mean all these tossers are tweeting from work ? Watching the cricket ?

Friday 23 August 2013

Back in Action...

Well, nearly. Due a a rather unfortunate failure on the renewal of our domain, just as I went on holiday no less, there has been a break in service. However, we are back and with the new domain of, handily purchased on a multi year basis!

I note in the meantime that for the first time in a few years we have had a proper summer. Papers and blgos full of silly season stories and no action in the markets. The City is quiet and for the first time since 2008 everyone is enjoying a break and not worried that when they return the world will end in a marekt meltdown thanks to QE/Recession/Euro/Revolution in china etc!

However, there are some sotries bubbling away and we will come to address these in the coming weeks.
Are you all having a nice time, the few readers we have left?

Thursday 8 August 2013

Summer Break (Unintentional)

OK folks - sorry for the break in transmission.  One of those bad interwebby things has befallen us, and if you've found this you will know we have been bounced back to being - our old Blogspot address.

So we're taking the opportunity of a summer break - back in a couple of weeks !

A great August to all.

CU / BQ / ND

Wednesday 7 August 2013

Too many shops

Retail units into homes. That's the latest cry. The Week has got in before the minister with its SELL THEM ALL! message. They say the government has given up on the high street. It won't even look at any of the hard bits of their own trumpeted Portas review. Business rates being the most obvious solution to the problem. Instead it went for the easy and almost useless parts. Fancy dress themed days. Street theatre and papering over empty units with colourful images of busy shoppers like some Potemkin village.

But how easy would it be to convert the High Street to domestic use?
Lets have a look.

This examples is from Bromley high street which  is a busy, built up, long established typical metropolitan south London/suburb high street and shopping centre area found in most 15,000+ population towns in the UK. Actually Bromley is much better than most. It has a million+ people catchment. Dudley could only hope for a tenth of that. All images picked at random from google.

Lease for sale.

You can see the flats above. Curtains are a dead give away. Retail stockrooms don't have curtains. Or windows that can open without bars on them. Internal theft being what it is. This is for sale as a going concern. But lets assume it isn't and was an empty.

Easy to convert. Brick frontage same as above. The window symmetry is going to be hard. Might just be able if the door was the other side. But that's an architect's problem. 
The upstairs is two flats already let to students as the uni is across the road. And making it into a student flat would be the best move. No garden and no views. Just a brick yard.
Its not very large, but bigger than many flats in this area. Maybe 800sq ft? The listing doesn't say.

Lack of parking is a problem. Current UK planning laws require appx - 1.75 car parking spaces per bedroom. At least 2 spaces required here. + turning and motorcycle and cycle spaces. Not insurmountable by any means. That massive high street pavement won't be needed if no one is walking on it. Two cars could easily park nose to the glass there. Or 1 space and a small front garden, as with a more traditional terrace.

A similar property. Hayes this time. Similar high street. Two flats above. One 1,000 ft lower unit for conversion. Same problems. Garden and parking and views. Would make nice terrace houses if all the units were converted. But few would buy a 5/6 bed £750,000 town house with a 10ft garden and only on street parking.
So flats it is. At least the gas will already be connected. Very few retail units without cooking/catering have gas. No need. 

Three small offices above the shops. Two person offices. Another typical high street set up. 
Converting the retail to offices would be very easy. Or a garage for two cars and a utility/ storage room? Trouble is it would cost you around £300,000 to have off street parking.
Monaco prices.

Retail to office is already happening on high streets, in a reversal of the last two decades trend. Shops becoming offices. One reason is there are a lot of empty retail units and rents can be as low as a minus figure. The tenant pays no rent but pays the rather hefty rates and service charges bills.  In villages an office in a former shop is even more attractive as the rent and rates are low already. Just blind over the large glass windows. 
Another reason is that once the planning consent for A1/A2 retail to B1/B2 business has been approved there is no further planning approval requirement for B use to residential.

The real problem seems to be cost. All of these shops are expensive to buy. The majority are currently lease anyway. To buy the cheque centre in the middle picture which is freehold is £250,000 + taxes. Then there is the fit out. How much to fit all the partition walls. Kitchen. Bathroom. Flooring. Plumbing. Gas. Complete new brick frontage and windows to rear. Garden. Parking. Chances of there being any heating is remote. The project is same as a total derelict refurb. 

So once the money is spent there is a the least desirable of flats a ground floor one. With no or minimal garden and views of not anything much.  And, as with many high streets, this is on a very busy main road. 

It can be done. But unless the prices come down, which they may well do if the recession never ends and the internet continues to take business, it seems the work involved and investment made may not see the best return.

Of course if you already own the premises then the proposition is much more attractive. Just the conversion costs and rent the flats. But cheque centre was/is paying £1400 a month. Looks to be about £500 pcm over the odds for an average two bed basic maisonette in Hayes. Quite a haircut. More a full number 1 clipper. And if everyone does it,  rents fall.

The internet accounts for 1 in every £10 spent. Supermarkets for another 3 or 4 of the ten. Still leaves 50%+ of ALL shopping in the UK on the high street. High street not quite dead enough yet for the economies to work. Better and cheaper by far for the landlord to just lower cheque centres rent by £250 a month.

Tuesday 6 August 2013

Admiral Sandy Woodward: Blood and Admiralty

We have fed our sea for a thousand years
And she calls us, still unfed,
Though there's never a wave of all her waves
But marks our English dead:
We have strawed our best to the weed's unrest,
To the shark and the sheering gull.
If blood be the price of admiralty,
Lord God, we ha' paid in full !

"People will die, ships will be lost, that's the deal. Go to it."  We are unlikely to call on naval leadership like his again.  Lone Trident submarines on patrol; the odd salvo of cruise missiles when the USA asks for a bit of company on one of its adventures; mine-sweeping in the Gulf; shooting up pirates offshore Africa - no, not really fleet actions at all.

Then again, who could have foreseen the Falklands ?

*  *  *  *  *  *
 And what shall we do when the cry goes up next time - The Hun is at the gate ! - eh, Cameron ?

Comfort, content, delight,
The ages' slow-bought gain
They shrivelled in a night ...

And who now is prescient to ensure ... a little State might ride secure / at sea from foes her sloth made bold  - eh, Hammond ?

The moneys that should feed us
You spend on your delight
How can you then have sailor-men
To aid you in your fight ?


Monday 5 August 2013

Dr Who: You Really Gotta Laugh

Scene: October 2012, one of the weekly BBC meetings where all those executives on £250,000 p.a. gather to spend our money ...

Chair:  Now, item 6 - the next Dr Who.  Rosalind, I think Diversity Planning has some input on this ?

Rosalind:  Yes thank you Chair, we certainly do !  And I'm sure we can all agree on this one.  It's been a missed opportunity for years and years, but now we must seize it with both hands.  The new Doctor will be a she !  And she will be black !

Chorus:  surely a Person of Colour ?! (much clamour around the table)

Chair:  Tarquin, what does Inclusivity & Cultural Fusion think ..?

Tarquin:  Rosalind knows my views on this.  We haven't properly considered the transgender angle ...

Voice from the back:  so it's 'Dr What' then, eh ? (guffaws)

Tarquin, angrily:  Who said that ?  (more guffaws)  That's a disciplinary, you know.  Chair, I look to you to keep order, this is a serious matter

Chair:  This is awkward, I assumed all the relevant views had already been canvassed.  Fatima - what is the line from Faith-based Community Outreach Strategy ? Is it time for a Muslim women Dr Who?

Fatima, shocked:  Chair, I don't believe you didn't know time-travel is strictly haraam !  This is very insensitive.  I'm shocked.

Tarquin:  FCOS don't get a vote on this  -  you know what Fatima said about Dale Winton

Fatima, mumbling to herself:  I'm shocked !

Bruce:  Well Technical and CGI are all in favour of having a bird.  We've come up with some suggestions - we're thinking Barbarella (passes round some photo-shopped pictures of Holly Willoughby in a completely see-through space suit, to cries of phwooar ! and fresh !) - and we've designed a wicked new sonic screw-driver (flourishes slender 12-inch pink cylinder) - look, its got batteries 'n all, you switch it on here and it'll give you a warm feeling, if you know what I mean ...

Rosalind:  Can I, errr, take a look at that ?  no not you Fatima, it's definitely haraam too (Fatima rushes out of the room)

Chair:  OK well, I think we're reaching consensus here.  I'll just go around the room one last time - any other inputs, colleagues ?

Martin, from Enterprises, in a suit:  Yes.  Dr Who is one of our biggest-selling brands in the export markets.  Almost up there with Clarkson, in fact.  No-one outside this room gives a flying fuck about faith-based diversity fusion.  The next Who will be a white male - or six of you in this room will be axed at the next cull.   The foul-mouthed Scottish one from Thick of It ticks all the boxes.  (clips up tablet and leaves)

Chair:    Ah. OK, well then, errr, item 7 ?  Rosalind, be a love, go and see if Fatima is OK ...

Saturday 3 August 2013

Peak Oil, EROEI and the Muffled Drum

An interesting thing happened last month.  The Oil Drum, a well-regarded website + blog, announced it was ceasing operations and archiving itself for posterity.  Well, everything has its day - we can all list blogs that were thriving a few years back but are no longer with us.

Some have suggested it was the extraordinary shale-based renaissance of US gas and oil production that did for the Drum.  Probably not.  But, fairly or unfairly, the Drum was associated with 'peak oil', which at its simplest is a view (or theory or doctrine or whatever) that global oil production - as a function of oil-in-the-ground - is doomed to peak, after which we start 'running out of oil'.  

At its simplest, it is Malthusian hogwash.  Of course, there are more nuanced versions than that, and the Drum shouldn't be tarred with the brush one would use for countering hogwash.  Much more important is the concept of EROEI - energy return on energy invested, which has been another Drum favourite.  And this concept really does bear careful consideration.  Declining EROEI could be the end of civilisation as we know it for, in the immortal words of James Lovelock - "civilisation is energy-intensive".  Better believe it. 

So - no more drum-beat.  But you'll not stop hearing about EROEI.


Friday 2 August 2013

Hioliday 2013!

Now it is the summer and finally raining, its my turn to depart to even warmer climbs for a couple of weeks and act out my baywatch fantasies by playing lifeguard for de kidz.
Mrs Unslicker has scheminlgy found a desitnation with no wi-fi and limited phone connectivity, so it seems as well as lifeguard I am to be afflicted with a period of intense boredom too, yet I am assured this is for my well being.
Luckily, that means an increase in quality on the blog as Mr Drew, a real man who never stops working, takes over for a couple of weeks. I have extracted a promise of limited doggerel from him, but we'll just have to see how it turns out.... I'll be back in time for the new euro crisis.
(As a last small aside, the treasury is saying it wants to sell Lloyds shares before the crisis erupts after the German elections - how sick is that, rip everyone off as they buys shares that will inevitably tank - this is HMT - we are ruled by scoundrels.)

Thursday 1 August 2013

Kicking Off the Silly Season with David Howell

David Howell was an ineffectual energy secretary in Margaret Thatcher's first cabinet, and was given the bum's rush shortly after.  He doesn't improve with age, does he ?

As a long-time energy player myself I bumped into this cove several times.  He had the type of early career that was somewhat less usual in the 60's and 70's than now.  From Eton and Kings he went straight into the Westminster / Fleet Street village and - to his pleasure and mild surprise - was ushered onto the fast track to a safe seat in his 20's.  Ever keen to please, he decided his contribution to the Tory Party would be books and newspaper articles in support of whatever he judged to be the prevailing orthodoxy, in the manner of the Vicar of Bray.  Thus, during the early days of Heath's supremacy, he was scornful of monetarism; but changed his tune adroitly in order to find favour with Thatcher.

And thus he found himself, wildly out of his depth, in Thatcher's cabinet.  Only one thing of note happened during his feeble period of tenure at Energy: the introduction of the Gas Levy and associated measures - a highly technical intervention in what passed for a gas market in those British Gas monopoly days. [I can explain it if anyone is really bored ...]  But he could take no credit: it was driven by the technocrats, in the days when civil servants knew their business (before Atilla the Hen kicked the s**t out of them and replaced them in the policy-making pecking-order with lobbyists and consultants) and were confident enough to tell useless ministers what to do. Anyhow, Howell was rumbled as a duffer and it all ended in tears.

Fast-forward nearly 30 years and in 2010 this superannuated simpleton  fetched up as an improbable junior minister in Cameron's first line-up. By coincidence, he is Boy Osborne's father-in-law ...