Nuclear Finance: Stuffed by the French Again

Later this week, we're told, the long-trailed announcement will be made of a new approach to financing nuclear power plants in the UK.

As we've long been warmed up to accept, no company is willing to take upon itself nuclear construction risk.  That was just about all that remained in the lap of developers, after EDF had blazed the trail with the outrageous Hinkley Point C contract that May so cravenly signed back in 2016 under stern instruction of the miserable tadpole Hollande (thereby proving to the entire watching world she was unfit to conduct the Brexit process).  But EDF itself quickly signalled that if we wanted any more nukes the next deal would need to be even better.

(Note always that HPC is a not-quite-free option for EDF - they still have no obligation to complete construction of the plant.  It can be argued they have no idea how to do it anyway, seeing that Flammanville has been put back yet another few years ...)

Still, the frogs are dangling the next one, Sizewell C, before the desperate eyes of HMG - and of course the Chinese and Japs and Koreans can all make their own offerings - if the contract is rich enough, and free of risk for themselves.

The chosen financing model to gratify their rapacity is the Regulated Asset Base model.  Details are awaited; but it's a familar enough tool, used across the USA in various forms for decades, and latterly for that grotesque and unnecessary project, the Thames Tideway.  But familarity alone is no recommendation.

The lazy headlines are that the 'taxpayer' stands to pick up the tab for the inevitable monstrous cost overruns.  Maybe; but it's even more likely it will be the poor old electricity bill-payer, which may seem a fine distinction but it highlights an important point.  Everyone needs electricity (and water) and their utility value to all of us is so great, we can be made to pay almost anything for them.  No new taxes required.  By these means we can be, have been, and will again be screwed into the ground, giving foreign firms the right to enjoy themselves on a grand scale at our expense for many decades to come.

The only possible argument in favour is that nukes have only ever been built by public finance, so we may as well don the nose-pegs and get on with it.  That assumes we need them at all - and I say we don't.  Or, if we do, we're f****d, because manifestly the French don't know how to build them within, say, 10 years of their airy estimates - so we'll always need large-scale Plans B, C and D.  Why not just settle for a good, cost-effective Plan B and have done?

Anyhow, knowing that several of our BTL regulars actually favour new nukes - have at it in the comments!

ND

Charisma vs Strategy: the Tory Leadership Choice

While the Tory Party agonises over which 'unt is to lead us to glory, time for some weekend musing over the rather extreme choice the two candidates present us with - almost a caricature of the dichotomies of colourful vs grey, big-picture vs detail etc etc.  I haven't read anything particularly interesting on this in the MSM; certainly not this very feeble offering from the Graun on leadership vs management.

In times that call for genuinely serious political leadership - analogies with war don't seem to me in any way overblown - one has been hoping upon hope that the hour will indeed bringeth forward the man.  The twin tasks before the next PM - to prevail against the EU, and in the next GE (though not necessarily in that order) - represent two enormously challenging theatres of political warfare that canot be avoided.  Admittedly, success in whichever epic battle comes first could materially enhance the prospects for the second ... but that didn't help Harold Godwinson, did it?  And the consequences of his ultimate failure weren't just long-lasting, they were kinda fundamental.     

Bringeth forth the man ...  Neither of the two hopefuls is a Churchill, despite Johnson's risible attempts to associate himself with that more propitious piece of our history (much like Gordon Brown writing his 'eight portraits' on Courage. Would he have included Aung San Suu Kyi today, hmmm?)  I struggle to find an encouraging historical parallel of a Boris-type taking the reins in such dire circumstances and plucking triumph from the jaws of defeat - though I could imagine there's an obscure Roman emperor who might fit the bill.  We have of course had some personally ineffectual kings down the years, but the successes under their reigns have been down to powerful players at the next level down - and where do we identify those today?

So here's a short piece I can recommend, on how to understand charisma - which is just about the only potentially positive commodity which Boris clearly offers in spades.  Whether reading that makes you any the more hopeful, I don't know. 

By way of balance, is there anything of substance worth saying about Hunt?  Actually, I think there is.  You have seen me before, tearing my hair over May's complete lack of anything resembling a strategy, in the face of people (Selmayr, Robbins) who clearly knew exactly what they were doing.  But here's Hunt who has actually published something on Brexit that is recognisably strategic.  If you haven't seen his 10-Point Plan before, take a read.

I'm not suggesting this is a work of genius.   And you can argue it's a pretty rum state of affairs when these things need to be published.  But secrecy over strategy isn't necessarily required in all circumstances: in some conflicts, one or other side's strategy (or both) may be so obvious to all parties - indeed, they may flaunt it - that secrecy is out of the question: but that may not weaken them materially.  And whoever produced this document for Hunt can also, presumably, be pressed into service by Johnson - and be invited to contribute to the GE strategy, whenever that's needed.

Your weekend thoughts on the Johnson/Hunt choice?

ND

Labour / Couldn't Make It Up / Part 194

Most of my friends who have traditionally been card-carrying Labour supporters have quit the Peoples Party now.  Despair and disgust.  Several have joined the Greens.  Over a beer last night one of these, a City professional living trendily in the East End, and heretofore considering it his social duty to the benighted borough to be engaged in good works via the Party, told me the story in his manor.

The thriving constituency GMC has been taken over by Momentum.   As part of their committee-packing drive, they replaced the LBGT rep - a cheerful gay chap whom everyone likes - with a straight, white male Union official.  And they replaced the BAME rep - an Indian lady who'd been doing the job proudly and effectively for many years - with another straight, white male Union man.  Incidentally, both of these carpet-bagging gits are middle aged, which isn't perhaps the image Momentum likes to project.

Multiply this a hundredfold across the land and I'm guessing the loyal-voter base quickly starts to erode, one way or the other.  It could well be put to the test quite soon, we must suppose.

Over the weekend we'll have a look at what might be facing them across the political divide.

ND  

UPDATE:  Makes this all the more amusing! 

"Momentum announces drive to help Labour members deselect MPs - says process will clear way for greater diversity in parliament"

The conversation should be privatising all education, not nationalising it



So, as is common these days, the very nutty communists who inhabit the Labour party (have you seen a book called Fully Automated Luxury Communism by Aaron Bastani? Drivel does not begin to describe how awful it is), have latched a new proposal into the labour party conference which decides their manifesto:


1 - Outlaw private education
2 - Confiscate the endowments and money from these schools to 'share' amongst State Schools
3 - End Charitable status to make doubly sure no Private schools start again.


Scary does not really do the above Justice. There are many, many reasons why the above it a terrible idea. The one that sticks out to me though is that, like our Top Universities, people from all over the world pay an absolute fortune to have their kids educated here - in fact I would bet it is one of the main reasons there are so many billionaires in the UK, they can educate their kids here.


So, in the real world, we should be thinking how do we extend the education opportunities provided by private schools to all? What is the secret.


Well the obvious piece is money. In Universities, the Government introduced fees to try and help Universities improve their offering, act like a supplier rather than an union and stop kidding people with silly Kite Flying degrees. Lo and Behold broadly this has been a success!


Thus the real change that would help state schools would be a voucher system for parents, who could spend the money on the schooling they wanted - local comp, technical colleges, religious schools, private schools. The good would prosper and the bad would reform or die. Just like in Higher Education, market forces would drive up standards overall.


You could even reduce massively the burdensome national curriculum as parents could choose they types of schooling suited to their children which is not always based on A-C grades a GCSE.


This would be a much more successful route than killing the successful bit of secondary education in order to level down the playing field.

The Ordure that the Left Pour on Themselves

There's an inclination to laugh at this but it wouldn't be right, because it's serious.  After decades of leftist encouragement, direct or otherwise, for all manner of 'identitarian' nonsense, the chickens have come home to roost.  The run-of-the-mill 'well-intentioned Left' of academia is now confronted with a Kafkaesque, reductio ad absurdum nightmare: under frontal assault (and I do mean frontal) by the militant 'trans identity' movement to a point where freedom of speech - and much else besides - is quite evidently a thing of the past in several UK universities.  (There are universities in the USA just as bad.)

Sit down, pour a stiff drink and read this: a compendium of appalling personal accounts compiled by the redoubtable and greatly-to-be-admired Kathleen Stock, on behalf of rational feminist educators everywhere.

But not just them, because this is truly baleful and if not stopped in its tracks will eventually flood out of academe and inflict itself on us all.  And - I remind you - Penny Mordaunt, Tory MP and Secretary of State for Defence, is complicit also.

For the antidote, let me even things up and suggest you read this, too, which restores a little of what the equally redoubtable Brian Leiter terms "intellectual hygiene".   Written in a nicely ironic tone, but making the point strongly at the same time.   

ND

2019 General Election date prediction - Thursday 3rd October 2019

More qualified observers than me can help with this post in the comments. There are some possibilities that are rapidly becoming facts which will create a General Election this year in the UK.


a) Boris becomes PM
b) 30 plus Tory rebels refuse No Deal option and effectively hold the Government to ransom


So far so good, but what does Boris do? He can't force no deal without some Constitutional aberration of trying to shut Parliament which to me is a non-starter and I think for Boris too.


So what is left is only a GE to sort out Parliament with a Leave Majority. Boris will fancy he can do this via an electoral pact with Farage. Whether people buy this will determine if the ruse is successful, but the basic maths are Tory and Brexit Party as one block will be bigger than the divided Lib Dems and Labour vote in the first past the post system...but by how much is the key betting question - it could be a huge margin is Labour lose their Northern seats to Brexit Party candidates.


So the option of a GE GE is Very Likely in the next few months we can perhaps try and forecast a when. There are no other viable routes for Boris as Parliament is against him and he leads a very minority Government that is split anyway.


You could have a second referendum, but even if this goes for Leave it does not sort out the recalcitrant parliament. A vote to remain ends Boris's PM tenure very quickly and not on his own terms, at least at a GE he would go down fighting.


With a GE decided upon, Boris will have to try and square away the Tory party and donors for this effort. Luckily he has July and August for this. We also know that Oct 31st is Brexit day so we need a new parliament before then to plead for a new deal/extension.


So an election sometime between September 1st and October 31st. End of October will be cutting it too close. We need a month for a GE campaign so I feel this is unlikely to be called until everyone is back from summer holidays. This more or less rules out September unless we et a 3 week campaign which could mean 26th Sept as a possible date, more likely to me would be either 3rd October or 10th October.


To me the 10th is cutting is pretty fine to go back to the EU for Plan C, D or E.


So, on balance there is likely to be a General Election on Thursday 3rd of October, with it being called straight after the August Bank Holiday.


Agree or Disagree in the comments.

Friday Humour: Trump Style

"In June of 1775, the Continental Congress created a unified army out of the revolutionary forces encamped around Boston and New York and named after the great George Washington, commander in chief. The Continental Army suffered a bitter winter of Valley Forge, found glory across the waters of the Delaware and seized victory from Cornwallis of Yorktown. Our army manned the [unclear], it [unclear] the ramparts, it took over the airports, it did everything it had to do. And at Fort McHenry, under “the rockets red glare,” it had nothing but victory. And when dawn came, their star-spangled banner waved defiant."

 Donald Trump, 4th July Speech 2019

Posted without comment with a humour tag. Maybe a small tear for his history teacher.

I really, really thought this was some made up Saturday Night Live comedy, apparently its the real deal. 

Peak Corbyn

As you perhaps know I am an inveterate, nay veteran strategiser: I have done it for a living in the military and in commerce.  In the aftermath of the dreadful GE 2017, my thoughts inevitably turned to how the Tories might work their way out of the ridiculous hole May had dropped them in.  (Obviously someone had been given an inkling of the result beforehand, because at least the DUP deal was immediately ready to roll.)

Sticking to aspects that are germane to the matter in hand right now, my strategy incorporated the following elements that had positive leverage potential:

1. The next (scheduled) GE would be five years ahead, a helluva long time
2. Corbyn was 68; McDonnell 66
3. In the ensuing years there were likely to be a number of truly loonie-left Local Authorities to provide public evidence of what these latter-day marxists do, given a sniff of power - 5 years being a mighty long time for them to hold their discipline
4. Da Yoof, whilst capable of surging onto the streets and into the polling booths in a fit of childrens-crusade enthusiasm, are nowadays notoriously fickle, flighty, of short attention-span, and low propensity to make commitments beyond the next Deliveroo pizza horizon  

Anyhow, their attention-span lasted long enough to grant Magic Grandad a full Triumph at Glastonbury 2017; and Momentum, buoyed up with all the confidence May had so culpably endowed them with (see recent posts), was gearing up to take over the world.

Then the long drawn-out Brexit stuff engulfed them, and Corbyn's resolute fence-sitting - almost indistinguishable from being fully impaled on a sharp bit at the top - has begun to annoy quite a number on the Left.  The tone of many a leftie article just now is:  too late, you old git, we've got your number now, and if you change your mind this late in the day, nobody will believe you.  Anyhow - remind me why we ever liked you in the first place?  And where's that pizza?  

Oh, how fickle is fortune, eh? (see item 4 above).   And then we come to item 2, and this week's "Corbyn has lost it" meme, so rapidly fanning out from the Murdoch press.  As with all good malicious rumours, per the Trump handbook (see Scott Adams passim) the key is to say something that immediately chimes, that was almost on everyone's lips anyway, that crystalises the already-present but non-articulated thought.  And, let's face it, this one falls on pretty fertile ground.  The timing was perfect.

Of course, Team Corbs (I believe they go by 'LOTO') have rushed into full Rapid Rebuttal mode - but this one would have been a challenge for Bad Al Campbell** lui-même in his formidable Excalibur prime.  Unfortunately, the best they can come up with is, Jezza is really quite fit.  For his age.  Ahem.  Sadly, as lots of people know all too poignantly, there is many a deep-dementia sufferer who is as fit as a fiddle ...  and that's even before we get into "Methinks / protest ..."  Just how smart is it to call for a full enquiry?  Who knows what else will come up?

People have periodically been calling 'Peak Corbyn' for at least 18 months, but thus far I haven't been convinced.  Today, there's a decent case to be made.  He seems to have a tight pretorian team that can face down even McDonnell, so they can probably keep him, El Cid-like, stuck on his fence for a good while longer.  (People did the same for Gordon Brown, as we frequently noted at the time.)  Trouble is, there may no longer be the adoring crowds gazing up at him from either side.  No Glastonbury for Corbs this year (according the Grauniad, he'd have been booed if he'd tried).  Could be quite a lonely place when the wind gets up.  Clambering down again may be painful in itself, and too late anyway.  Talk is already of handing the baton to Rebecca Long Bailey.

By the way, I hear McDonnell's health is not of the best ...

ND
____________________________
**Did he even start the rumour ..?

UPDATE:  this,  from today's Guardian

Rumours have been flying for months not only about Corbyn’s physical health ... but more broadly about his intellectual capacity; his ability to master an endless series of complex briefs and take timely decisions on difficult issues, while simultaneously managing a sometimes fractious party and dealing with whatever unexpected crisis blows up.

 AND MORE:   (also Graun)

Corbynism’s greatest liability is now Jeremy Corbyn himself ... He sounds tongue-tied and looks like a man hiding from battle, which undermines the image of a candid crusader. When the hero no longer embodies principles on which his movement was founded, the whole edifice wobbles. The attention of young idealists drifts; affection turns conditional; benefit of the doubt is withdrawn. It is getting notably harder, for example, to be loyal to Corbyn and determined to combat antisemitism at the same time ... He once exuded a gentleness that made allegations of fanaticism sound preposterous. Now his peevish side cuts through. He once animated feelings of belonging and purpose in people who had felt starved of inspiration by soulless New Labour. Now he refuses to quench the thirst of his party’s parched remainers ... Few Labour MPs, if any, relish the prospect of an election under their leader, although most pretend to want one. It is hard to present Corbyn as a man for the future, and May’s departure will date him even more. He will be a stale continuity figure from the time of stasis, irradiated through years of loitering ineffectually amid the referendum’s toxic fallout. His aura of specialness has dissipated, revealing the man in all his flawed mediocrity. The prospect of Britain having a radical Labour government is sliding into the gap that has opened up between an idea people once called “Jeremy Corbyn” and the actual Jeremy Corbyn.

Will growth fall to 0%?

The quarter is over and the results are eagerly awaited. There is not much to be gained in the round by overly focusing on GDP numbers - the statistics are so variable that revisions can do things like erase recessions a few months later (as happened in 2011).


Indeed, just this last weekend the statisticians decided that the UK economy was £32 billion bigger than they previously estimated. This is small when considering the UK but £32 billion is a lot of money - but of course is about the size on one of the Baltic States entire economies or rather closer to home only slightly smaller than that of Northern Ireland which is around £40 billion.


But statistics have their uses as a guide to the general direction of things and one thing that does happen over time series is that they do track into and our of recessions. So this month should be interesting because Q1 of 2019 was 0.5% growth which is really quite good for the UK economy.


However, there was a lot of stockpiling ahead of the non-Brexit of 29th March and so this may have brought forward some corporate and other spending. As such Q2 will be weaker almost as a given, but will it drop to 0%. One really bad aspect of Brexit is the uncertainty, even a hard Brexit does at least end the uncertainty which is causing businesses to under-invest. Although Foreign Direct Investment is holding up well, it is also dropping off from its very high level.


Investment is crucial to the UK economy, without it we continue to move towards a low-pay, low added value model more akin to Southern Europe than US or Germany. The Government can only invest so much with a high public debt already, so we need the private sector investment.


Overall, I think growth will slow to 0% or near 0% in Q2 of 2019. With Brexit likely not until Q4 at the earliest, investment will remain weak and so Q3 over the summer could also be slow, hoping that renewed stockpiling could see a winter run up in GDP - overall though from here it seems hard to predict GDP growth above 1% for 2019 which is a very poor out-turn for the current rude health of the world economy.

May's Legacy: As We Were saying

As you may recall, I consider the worst feature of May's baleful legacy to be that by failing to crush the morale of the bedsit left in the 2017 GE, she has encouraged every leftist idiot out of their decade-long despondency to give vent to their wildest fanatsies - which they have every intention of having Corbyn enact.  And in the bidding war before the next GE, who knows what he'll promise?

Exhibit A: - and I'm going Daily Mail on you now - here's the operative part of a motion passed on Monday at the AGM of the British Medical Association.

This meeting calls for the policy of charging migrants for NHS care to be abandoned and for the NHS to be free for all at the point of delivery

And they do mean 'all'.

See what I mean?

And the thing is, stuff like that can actually be delivered.  It's the complex financial stuff they'd find they can't do.  And then they'd turn to the gesture politics.  It's cheap (in the short run), it's stroke-of-a-pen stuff.  And they'd really enjoy doing it.

ND

The next chancellor.

The Brown and Blair 'Pact of Spiel' led to an unusual event. British Chancellors became permanent. For the entire length of the Premiership.

Brown had so much power, and knew of so many buried bodies, he ran the UK economy, solely to suit himself. Without bothering to inform the Prime Minister about what he was up to.

In turn, his own Chancellor, Darling, refused to do what he was told. And due to Brown's ever decaying power, he quickly became immovable.

Cameron's chum Osborne also had a very large hand in running the economy. Though that was due more to Cameron's indifference to what his financial wizard was up to. Osborne served the full term.

Hammond was May's 'safe pair of hands.' As all the others before him had been.
And he too, quickly decided to do his own thing. He refused to allow Brexit without a customs union or a hugely long , never ending transition. And May's power and authority disappeared even faster than Brown's had. Hammond will outlast May.

Assuming the lead candidate succeeds in his leadership bid. And assuming the Remain Tories don't fulfil their promise to immediately bring down their own government, Johnson will need a Chancellor.

Who could that be?

The steady, grey, dull, semi-competent, serious, and intelligent Hunt could have been first choice.
If there hadn't already been an Eeyore in charge for the last three years.

Who else?

Gove should have been an outside chance. A fickle Releaver. One who can pretend to be either for or against Brexit, with some conviction. But whoever gave Little Finger money and power, and survived to regret it?

What about Fox? International trade is a bit like national finance, isn't it? But, of course, everything that goes for the untrustworthy Gove, goes double for the Fox.

Liz Truss is already in the Treasury. A woman chancellor would be excellent politics. Partly neutralising the misogynist Johnson labels.  If only she hadn't been a staunch Remainer in 2016.

Another alternative to make the media yap a way on nothing at all, would be to appoint an ethnic chancellor. Javid? Another Releaver. Johnson might be tempted to just leave him where he is. After all, there is always some disaster at the Home Office about to splash onto the papers. Handy to have an ex-rival in place ready to take the fall.

Or Kwarteng. Kwarsi was a leaver. Has very dry, Tory values. Ticks the minority box, even better than Javid does. Though he has been Secretary to Hammond. So might be sympathetic to the doomsayers at the Treasury.Though on the plus side, he is a Minister in the Brexit department.
He does seem to be the one..Oh wait? Didn't he constantly say to sign the May agreement of the Damned? Blast him!

The media will be being fed the Eu's choice, for Florence of Arabia. Rory the unTory as Chancellor. I suspect even Grayling has more chance of getting the post than him.

Rabb
McVey
Rudd
Lewis
Hancock
Mordaunt
Barclay
Ellwood
Mogg
Perry

Farage?


Or someone else entirely?

As we have seen, the Treasury is usually used for the most loyal, or most treacherous ally. To appease a big beast, so they support the PM through shared vision, or are sufficiently mollified to push that beast's own followers into line, so securing the government's stability and ending the civil war.

Who would you choose?

If not Boris, who?

It seems many of the people Boris Johnson has come across in this life now have it in for him. I guess that is where obvious and naked ambition gets you.

The list of haters is long, the BBC, the Labour Party, the EU, his ex-bosses, his girlfriend’s neighbours.

All of whom do not think much of him. Maybe if the hate is kept up it may get Jeremy Hunt to be Prime Minister.

But this is just the warm-up. There are only two outcomes of the path we are on.

One is a Jeremy Corbyn government where the hate spews from the Government too as well as the media.

The second is a Farage Government. Can you imagine the BBC and Guardian in that case. It will make this Boris hate festival look like a minor tiff with ones girlfriend.....

Unsettling AI, Right Here & Now

I'm sure we are all fully seized with the potential of AI and related developments, positive & negative, and have all read what internet uses the Chinese intend for it.  Much of it seems a little way in the future.  But here's a first-hand tale from this week.

I belong to a UK-based organisation that has a branch in the US.  I correspond by email very frequently with the UK Hon Secretary, we'll call him Martin; and only occasionally (maybe once a quarter) with the US Hon Sec whose name, coincidentally, is also Martin.  Recently I was told, verbally only and as a piece of breaking news not generally disclosed anywhere, that Martin (US) proposed to float an idea for a new type of activity involving his US members - and (before he told anyone else) what did we think of it?  

Having slept on the idea (but not communicated it further) I emailed the person who'd relayed it to me that I thought it was a good one.  I referenced 'US members' but no names.  I then hit the cc button to Martin (UK), something I'd done a thousand times before, because he'd been party to the original verbal discussion.

My email system immediately flashed up: "Did you mean Martin (US)?"

FFS !  If its algo was (as one might expect) based on past behaviours by volume, and indeed context at a basic level (i.e. comms within the organisation in question), the simple probabilities were very heavily stacked in favour of my intending it to be Martin (UK), as I'd actually intended and clicked.  But presumably it had "seen" a reference to US members, and "knew" Martin (US) was associated with US members; or "seen" an email on the same subject between Martin (US) and my addressee ...   This is clever and useful, but ... well.

I recall the first time when I was "asked" whether I meant to append an attachment when I'd mentioned such a thing in the text, but hadn't appended anything before hitting Send.  That seemed quite clever at the time.  Things seemed to have moved on a bit ... 

And this is all real-time stuff with (obviously) no human intervention whatsoever.  Cunning bastards.  God alone knows what the real bastards (China, FB, ...) are doing with this stuff.

Any stories you'd care to share-and-scare?

ND

UK really can grow Unicorns

Following on from Andrew's comments yesterday, a piece from The Times:


Britain is creating more $1 billion technology companies than any other country apart from the United States and China, a study has found.
Over the past two decades UK-based entrepreneurs have built 72 companies, including 13 in the past year, that have topped the ten-figure threshold — known as “unicorns” in the tech industry.
That compares with 29 in Germany, Britain’s closest European rival, and India with 26. Over that period, the US and China have created 703 and 206 respectively, according to research for the government’s digital economy council published today.
Investors have poured about $5 billion into British tech start-ups since January, reinforcing the country’s status as Europe’s leading high-tech nation, the research said. More than a third of Europe’s fastest-growing tech companies…


For once, we are getting it right - far more by luck than judgement. The UK is doing very well with tech start-up's. There was a time at the start of Brexit when it looked like Amsterdam and Berlin would clean-up (Paris as ever talks a good game but really...let alone now in Gillets Jaunes land).


But no, the UK and London have powered on. Powered by a few key things, as ever hard to emulate. One is the ease of working in the UK compared to the rest of the EU. Another is the ability to keep your money when you sell through generous EIS schemes, another is the ease of language and living in the UK and London, also that our economy is post-industrial and this suits the new tech start-ups. Finally and the killer is the ease of access to Finance. Only Silicon Valley, New York and London can cope with global Venture Capital needs. As such, the flow to the EU stopped and reversed.


Now we have a nascent industry in Fintech, Legaltech, Martech - you name it the UK is developing it in the professional services space but also healthcare. Brexit will have zero impact on this and luckily the Government is too pre-occupied to think about taxing or regulating it to death yet. So for now, happy days!

Investment in UK on a slight falling trend - Brexit certainty needed.

It can be hard to decipher what are the actual facts behing many statistics these days. Media which used to be seen as matters of record - like The Times and the FT - are now as partisan thanks to Brexit derangement syndrome.


A good example of this has come out over the past few days. Investment in the UK by businesses is a crucial part of the economy. For a long time UK investment has been low, thanks to huge supply of low cost workers and this has been a big driver of low UK productivity.


Now, recent surveys show that business investment in the UK will fall by 1.3% this year. As ever this is just blamed squarely on Brexit. A bigger driver, although related, it the huge fall in car production both in the UK and across the EU. Given the huge investment in car production facilities over the past 15 years had been on of the key drivers in investment growth, it is not surprising that when this turns negative it will materially impact the UK. Now, many car makers are rightly worried about just-in-time delivery under 'no-deal' terms. however, the collapse in car sales, the ruination of the diesel market and the need to invest in all electrical car production are major factors too.


Also, the FT was gleeful last week in saying how FDI was also falling (which, confusingly, also has overseas car makers in the mix - given they are both UK and overseas businesses at the same time). Except that you have to read carefully to fine that it is fallen 1% from and 18% EU share to 17%. And the UK is still the leader by a country mile. In fact, it really shows the UK is in rude health with Brexit fears being a very weak driver, if at all.


However, the overall picture is still of UK investment declining and Foreign Direct Investment declining. The uncertainty over Brexit and the political instability this has produced (thanks to the remain media establishment, like the FT!) is not helping. We might well at this stage in the cycle see a decline in Investment but to me what this shows is the Tory leaders are broadly right. 2019 needs to see a resolution of Brexit to reduce uncertainty. Once that has happened, it is likely investment will start to accelerate again subject to normal market environs (ie if there is a recession).

Rory is Magic!

Rory Stewart dreams of being a real boy.

  After his surprise endorsement from the Daily Telegraph, hopeful for the Tory leadership race, Rory Stewart, has had to defend himself from criticism that he isn't actually a Tory at all.

Stewart's personal manifesto, promising a Rainbow Unicorn alternative ecological-pure thought parliament. Free, class A drugs, for students and former army officers. And replacing voting with throat chanting for candidates has attracted rave support from hippies and freaks and weirdos.

Rory, the slightly oddball looking, barefoot, Himalayan wanderer, has been likened to France's President Macron. Mostly by other Macron supporting globalists. 

But has also attracted some criticism from people who say he is not a true Tory.

"Look, I'm a real Tory, " Rory told the media. "It's just that some people, generally older, whiter, richer people, find the idea of a true patriotic Tory, being willing to bring down his own government and install Jeremy Corbyn in Downing Street, a bit difficult to come to terms with."

Senior Tories have hinted that wet fish Rory is more of a Liberal Democrat than a Conservative. Mainly due to his stance on ecological and social issues and that he keeps saying "I'm a Liberal." 
Some have even suggested that Rory's surprisingly well funded leadership campaign, with a very credible, Facebook social media presence, is actually being run by Nick Clegg.

Nick Clegg? I've never heard of him.

Rory responded by embarking on a flip-flop walking tour of the railway station car parks of England. Declaring "Look..Look at me..I can walk all by myself. There are no strings on me! Because I'm not that kind of puppet. I'm a totally different kind of puppet."

Zero-Carbon: May Screws Up her 'Legacy'

[Foreword - to those C@W readers who have apoplexy at the suggestion CO2 emissions contribute to climate change: the rights and wrongs of that issue have no bearing on what follows.]

The story so far:  a latter-day Childrens Crusade fronted by a cynically manipulated little Swedish girl, coupled with large-scale childish behaviour on the streets of London from grown adults who ought to know better, has made some raucous political music with demands for completely infeasible actions against UK CO2 emissions - specifically, zero CO2 by 2025.  Among several organisations to seize this opportunity, the Commitee on Climate Change (headed by the conflicted and disreputable "Lord Deben") rushed out its proposal for 'Net Zero Carbon by 2050'. 

These recommendations, properly viewed (i.e. politically viewed) were an absolute Godsend for the beleagured Tory government.

1. Deben immediately defused the 2025 nonsense.  He is the man fronting an enormous report that had loads of pretty respectable input++ from business, industry, real scientists etc; and they all agree 2050 itself is quite stretch.  Deben was actually asked about 2025 on the telly, and he was contemptuously dismissive.  
2. Consistent with 1 above, net-zero-2050 is notably more demanding (in the form the CCC wrote it) than any other nation has committed thus far.  Plenty of rich political capital can be coined from this.
3. Nonetheless, 2050 is, well, rather a long way into the future ... a pretty decent entry into the Can-Kicking Championships
4. Although the Labour Party greatly hoped to be steering the limelight towards itself, the best it could do in response was to replace "by 2050" with "before 2050".  (This is because some of them are seriously bidding for Actual Power, and fondly expect to be the ones to implement it.  And they, too, reckon 2050 is a stretch.)   

All in all, a gift for the distraction-seeking and legacy-craving Theresa May.  Quietly neutralise the jolly annoying Extinction Rebellion, as desired by ordinary people everywhere; and impress the young people by Doing Something Amazing for the planet.

There would have been so many ways to big this up and wow da yoof.  Top of the list would have been to say that the Deben proposals were not ambitious enough, and she was going to do something even more impressive: it wouldn't have been hard to come up with something.  (For 2050, you can say whatever you fancy - everyone else does.)  Nobody's going to vote against it in Parliament, are they?

But no.

Rather grumpily and with stupid caveats** that can be, and immediately are, used to damn her, she says "oh well, alright then".  Why insert a 5-year review?  Parliament can always review and change any legislation it fancies.  And anyway, 5-years-hence is Not Her Problem!  Why allow the buying of carbon credits to count towards the total?  This is so easily portrayed as a nasty little weasel (which indeed it is - international carbon credits are as bent as a nine-bob note); and again, 2050 is a long, long way off!  Details not required!

As every wise parent knows, when the kids have been kicking up for Disney and you've decided to take them, you don't say:  oh alright, bloody Disney it is, but you're not going on Space Mountain, there will be no ice cream, and at half-term I'm going to ask your teachers if you've been working hard, 'cos if you haven't I'm cancelling the tickets. 

Oh dear.  She ain't gonna enjoy her retirement.

ND

____________________
++ We can discuss this another time
** This is said to be Hammond's doing - like so much of what has been baleful over the last three years.  His long-faced 'trillion pounds' objection is just rubbish.  Presumably, like an extensive line of men before him - Osborne, Hollande, Selmayr, Robbins ... the list goes on - he sat her down and told her sternly what she had to do.      

Boris the Tax-Slayer

It is quite hard to consider the Tory party leadership election at all. We always think that today we are ruled by political pygmies - peoples' reputations take a while to settle in and most often not when they are in office. For example. Ed Balls was considered a fairly mid-level politician by now in comparison to the current Opposition front bench he is a colossus.


However, many of the runners and riders in the current Tory party are obviously not good Conservative Prime Minister material. From the Lilb Dem Rory Stewart, to the unhinged Andrea Leadsom (who is a good minister though, being of strong enough will to stop the civil service from doing nothing as per). It is not a very edifying field and the only good thing one can see is that for the Tories it allows them to hog the headlines.


But, there is Boris. I have serious doubts about his ability to be Prime Minister - I think it still says it all that Gove knifed him and ruined his own career, plus let in May, rather than let Boris who he knew so well grab the Crown. At least, by default, he is better than Corbyn.


Also there is his tax cut grab. Very sharp this, reducing taxes on people who earn £80k or less- just like the MP's that vote for him per chance? More seriously, it is a long time since anyone in the UK public arena seriously talked about cutting the high-burden of taxes. And high they are by all historical standards. Faced with Corbyn pledging to tax and spend, this is really the Tory answer that will resonate on the doorstep in an election with a big chunk of swing votes. Add it to the Northern leave vote if he can Brexit through and Boris is home and hosed. Of course, once he has got power, perhaps delivered a compromise Brexit, he will then have literally no idea what to do.


A peaceable couple of years of Government is long-overdue and will be most welcome to many.

Naughtiest Prime Minister.

What's the naughtiest thing you've ever done?

 

Ran through fields of wheat?

Crashing the United Kingdom out of the European Union ?

Taken the UK into a Middle East war, for no real reason?

Sold the nation's entire reserves of gold on Ebay with no reserve bid?

Saying you spent all your time working on the dangerous dogs act. When the only dangerous dog you were seeing was the one your were having an extramarital affair with.

Replacing the most hated tax in the UK, the Rates,  with an even more hated one?

Running up so much money on the nation's credit card you had to call the IMF to help pay it off.

I'd suggest having a PM tripping on acid all day long would be doing the country less harm than some of the other things they might be planning.
 

For me, in my leadership bid to become PM, I cannot really think of what the naughtiest thing I've ever done is. 

There are quite a few. Which always surprises me as I'm usually so very good.

I was present when a sibling Monopoly game descended into gunfire.

I once piled up 100, 60x20 cardboard boxes. Having filled the cente ones with aerosols. And set them on fire. The Fire-brigade had to be caled to help put out all the trees that were burning.

I swapped all the house signs from people's gardens, walking home from school one day. People were furious.

I took part in the very first 'race around the M25'  when the motorway opened. And almost, almost had a severe accident when it turned out the damn thing wasn't completed at all. And there were still traffic lights in use at the Abbotts Langely section.

But I suppose being asked to leave my boarding school for an undisclosed incident, that really wasn't that bad, must be the naughtiest. And amongst people I knew at school, that was a really minor incident, compared to what they were up too.

What was your "Naughtiest moment?"

Corbyn Snorted Illicit Stuff, 'Fortunate Not To Be Jailed'

In preparing for his bid to be the next Prime Minister, Jeremy Corbyn has admitted he several times snorted something that sounded like an anti-semitic remark.  Anti-semitism is a Class-A hate crime and is illegal in many countries.  

He said it was during his earlier career as a no-hope backbencher, and that he did it because "everyone was doing it at the parties I went to in those days.  It gives you a wonderful 'boosted vote' feeling, but I've been told to say I know it's wrong."   

He agreed he was lucky to have escaped jail, and that it might have affected his ability to travel in the USA: it is required on a US visa application to make a declaration about involvement with banned political movements associated with the Holocaust. 

He went on: "While we are on the subject, I should add that I occasionally smoked some of that marxist dope, but it had no effect on me, because I didn't take it in."  Mr Corbyn is known to be not very bright, and failed his A-levels. 

Friends of Corbyn insist none of these things disqualify him from becoming PM.  One leading Shadow Chancellor said: "if smoking that dope disqualifies him, there's no hope for any of us".

ND

Peterborough - What happened?

A slightly surprising result all round.

In that everyone who usually claims to have won, has a decent story to tell.

The new Labour MP has the lowest share of the vote for an MP, ever. Volatile times, but uncertainty and change are not guaranteed.

 

Labour held off the Brexit challenge. An impressive feat as it was assumed a loss was on the cards. Vote dropped dramatically. But they were fighting under some of the hardest conditions, with the biggest disadvantages due to candidates, that they will face. If they could hold on here, they can hold on elsewhere.

 

The Brexit Party did extremely well. Suffering gloom today really through expectation management failure. They don't have the resources or the organisation to ensure a victory. They will win some and they will lose some in the coming fights.

The Tories, though having a nightmare, are also currently, probably, at the low point of their fortunes. The failed May too toxic to make an appearance during the campaign. Managing to still keep 7,000 votes was a result of sorts. In that, it could, and should, have been even worse.

The Lib Dems got half the vote they got in 2010. The idea that a second referendum will win Labour many more seats than it loses, is a proven myth. The yellow surge is back to what it always used to be. Protest votes. And rich metropolitan or student areas. The Liberals former rural strongholds have not come back to them.

 

The clear message for anyone who wants to see it is,

 

1. Split Right Wing voters will allow Labour to keep its seats. And may allow them to pick up a few more. And they don't need many to form a rainbow coalition of idiocy. A Corbyn premiership is more likely, rather than less, after the result.

2. For the same reasons the screech of the majority Remain Labour MPs may be ignored a while longer as the losses sustained under JC may be subsiding. Labour Remain have been chipping away at Corbyn. Telling the Great Oz he cannot become leader of the un-free world, unless he embraces second referendum and no brexit. The Politburo need no longer have doubts in their dedication to the teachings of Corbynism.

3. For Farage, he has achieved a fantastic result. And characteristically diminished it through over promising and a slightly odd decision to not treat the result as a huge victory, if it was or not.

The new, more focused, single, simple, Trumpian messaging, is working. 

Previously UKIP was all over the place, all the time. Electoral reform. Immigration. Taxation. Privatisation. Deportation. Attacking Parliament. The NHS and the BBC and the media on as many issues as they could find. A strategy for getting noticed, to be sure. But one that seemed to stop paying off around 12% of the population. 

He is beyond that already.

The Brexit Party had all the advantages, except the most important one. Data. 

They cannot be as effective as their rivals without it. 

As it stands, TBP can win some seats from the Tories. But perhaps only enough to destroy them both.

 

 Somehow, Farage is going to need to hire the very best ground pounder and data manager in the business. 

I doubt he will call Dominic Cummings. 

I doubt Cummings will answer his phone, if he did. 

 

4. For the Tories, Judgement Day is here. There can be no more hiding behind the sofa and hoping the whole ghastly Brexit experience will just go away. The Peterborough Tory -29%, contrasts with the Brexit Parties +25%. To survive, Brexit must be delivered.

Not ignored. Or delayed. Or postponed or negotiated. But delivered. The only wriggle room is in how satisfactory to general leavers the exit need be. 

Any attempt to plant another false Leaver at the helm will be disastrous. Any attempt to avoid a decision by the next election will also be a disaster. 

 Every delay or deadline extension will just add more votes to the Brexit Party side of the electoral justice scales.

Appointing a die hard leaver might also be a disastrous strategy. As might a hard exit. But it might not. 

Three years wasted under May leaves little in the playbook but a massive show of courage, bluff and a Hail Mary pass. 

But it is now certain that unless Brexit can be removed as an issue, the election will be lost. And lost very badly. John Major levels of defeat.

5. Liberals. As with the BP, always worth remembering that a Euro election is not a Westminster one. It will take more than just loving Europe to be a force. Like the Brexit Party they are still doing very well, considering where they were. The Liberals have an opportunity to rebrand and from a better position than Labour or the Tories. 

Outgoing, ageing, Venerable Vince gets a clock and handshake, and enjoys his retirement. Incoming, youthful, millennial, female, young-mum feminist, Jo, comes in. Loads of media attention and new broom ideas. A rare chance for a second political chance for the Liberals.

 

A summary from the person who is having their last ever day as leader of the current Tory Party.

"NOTHING HAS CHANGED."

Yet.

Euroland updates

One interesting side-effect of Brexit has been the sharp drop in interest in the actual runnings of the EU. Now that the #FBPE crowd are all around, there can be no criticism of 'the project' to do so is to undermine everything.


And on the Brexiteers side, having sort of won the vote, the focus on just how rubbish aspects of the EU are has fallen away - sadly in favour of infighting and mass navel gazing.


Two current issues demand some attention. The first is economic, as we approach the top of the cycle (sadly for much of Europe as EU members have stagnated for over a decade, shame), members need to get their act together. Italy is the key concern - it has a debt to GDP ration of 130% and increasing. The new populist Government is trying tax cuts to remedy the austerity which has not worked for them for 10 years. The jury is out as to whether it will work, but abandoning the policy chosen by the Bundesbank EU Central bank is not going down well. There are real threats of fines as well as much hand-wringing. Longer-term, France owns a third of Italy's debt - should Italy go the way of Greece we will have 2011 Euro run part two, run harder!


Then there is the result of the EU elections - without going into the huge detail here is an excellent article on Politico.


My main takeaways from that are the EU is entirely made up of smoke-filled rooms and driven by the whimsy of Merkel and Macron - but only at a distance. The likely EU President of Guy Verhofstadt should be enough to even make Remainers take a sharp breath - the guy is a maniacal integrationst zealot. The democratic will of the EU - increasing the share of anti-EU parties in Parliament only to see the most pro-integration President ever get elected in the back room deals - seems to be a winding river indeed.


Remaining will be such fun!

From the dark side to the depths

Thank you to co-writer ND for keeping the blog going this past few weeks. CU has been busy with a career change which has resulted in needing to spend time focusing on a bit the day job of capitalism.


However, I return refreshed to see the Tories in true meltdown. Just yesterday the slightly strange Andrea Leadsom announced that she would drive No-Deal Brexit through by proroguing Parliament. This means to stop Parliament from meeting for a few months. Whilst constitutionally possible, it would be a national outrage to try this.


I mean, I know the Tories are not going to get much in the way of votes at the next General Election, but this stunt would completely ruin them. It says Conservatives on the tin, the electorate do not expect to get radical illiberalism instead.


Having said that, I have some sympathy with the thinking behind this position. Clearly the current parliament has tried and failed to pass any deal for Brexit and voted to avoid a no-deal Brexit; the circle cannot be squared. This way at least moves to try to end this impasse. However, in reality to do so without an election is nonsensical. An election is the obvious route if there is no way through Parliament - this is what the constitutional principles would suggest. To avoid an election would be an abomination and the next time there was one there would be a high price to pay indeed.


Also, though, Leadsom is helpfully signalling that the issue is indeed the Remain parliament and not the Tory party. Yes the Tories are split, but the failure of Labour or any other party to vote for anything deliverable is the real cause of the current mess. Sadly, this will be lost in the messaging.


In any event, the Tories are not going to be choosing Leadsom - it seems to me the choice will rapidly boil down to another remain-pretender in Jeremy Hunt or the unknowable quantity that is Boris Johnson.


I am not sure they will even make it as Prime Minister more than a few days if the DUP and Tory rebels vote against a motion of no confidence.


Tough times for the Tories, a Brexit party by-election win is not going to clam them down this week - it perhaps shows the path to their imminent destruction when there is a 2019 General Election.

Boiling the Pot, Stirring the Pot

Busy this week, I'm afraid - and CU + BQ are really busy.

So, by way of a pot-boiler, have a read of this: another item of evidence in our occasional series lamenting the idiocies of university lefties of the identitarian woke-snowflake generation.

 ... scepticism about the rights of marginalised groups and individuals, where issues of life and death are at stake, are [sic] not up for debate. The existence and validity of transgender and non-binary people, and the right of trans and non-binary people to identify their own genders and sexualities, fall within the range of such indisputable topics

What level is Academia sinking to?!  I'm pleased to say that the Aristotelian Society, which is the target of this outrageous attack, is sticking firmly to its guns and continuing to promote the lecture that is enraging these people so.

PS, what a great set of names, those signatories, eh?  Amy Conkerton-Darby; Puck Oseroff-Spicer; Lizzy Ventham; Jingyi Wu ... (Anyone ever read Peter Simple?) 

ND

Labour's Energy Nationalisation Plans: Interesting Stuff

Even if Extinction Rebellion didn't pull off its attempted election-night stunt, everybody has been much taken by their efforts - note how the annoying government Smart-Meter advertising campaign is trying to hitch its wagon to them; and there's even a Graun article here suggesting that if they seriously want to save the world, da green yoof should, errr, join a union!  (Actually they should clean up after themselves and curb their rampant plastic-oriented consumerism ...)

The Labour Party is fairly troubled by the electoral manifestation of this Green surge, and is rushing to outbid everyone else in its *promises*.  Noting the universal scorn for the ER's "zero carbon by 2020", they are toying with a 2030 target.  Ah well: as one of the ER demonstrators said to a TV interviewer: this is no time to be realistic.

Far more significantly, under this green smokescreen they are also planning to renationalise the gas and electricity transmission grids and distribution networks (DNOs).  For hardcore C@W readers, if you give even half a chance to there ever being a Labour government with McDonnell holding the reins this is a subject for serious study.

1. Choice of target.  Assuming (as we must) that McDonnell actually intends ultimately to nationalise far more than this, the Grid + DNOs is quite a shrewd starting point, politically speaking, for getting his ball rolling.  Not many people carry a torch for this lot.  They are natural monopolies.  They are still under public ownership in many EU countries, so it's hard to claim nationalisation will obviously be disastrous, or fundamentally contra to EU law.  They are asset-rich, really easy to finance (guaranteed, regulated revenues) and heavily unionised.  Many are owned by wicked foreigners.  (And, frankly, several of the DNOs have pig-shit thick management.)
2. Paying for it.  They are a bit vague on this, musing that perhaps they don't need to "pay compensation" (morally speaking, that is - because the wicked shareholders have been ripping us all off for decades); but then again, maybe (legally speaking) they do.  However this plays out, they'd be exchanging equity for government bonds.  They've obviously taken some fairly well-informed accounting advice and reckon it will be neutral as regards government borrowing.
3. Grand plans.   You need to read the stuff to get the full measure of this, because it's far from a simple change of ownership they have in mind.  Briefly, it is intended as a springboard for getting councils, unions and 'local communities' in on the action, with control of energy distribution being atomised into at very least several hundred local authority-based mini-regions, but ultimately down to thousands of micro-regions: cooperatives, housing estates, business parks etc etc.  (These must be sufficiently 'open and democratic': wealthy gated communities or fat-cat County-set windfarmers need not apply.)  All with 'maximal union involvement', natch.  Plus a bizarre edifice of regulation and governance - which will be much needed: this is gas & electricity we're talking about!
4. "Rationale".  The ostensible reasons for doing this are threefold.  (A) reduce costs to the consumer - because coupon for bondholders will be less than divi, and managament salaries will be slashed.  (B) Facilitate the Green Revolution - because the Grid and DNOs have been dragging their feet.  (C) Democratisation and local participation.  Curiously, they don't admit to outright doctrinaire bullshit, though it's not particularly disguised, either.

What to think?   The electricity industry holds a particular fascination for leninists and stalinists like McDonnell - it is sometimes said that leninism was marxism plus electricity, and the whiff of the industrial soviet is easily detected here.  But personally I'm by no means horror-struck, if this to be as we are promised one of the first acts of a Corbyn government.

a)  it will quickly bog down in protracted legal challenges over (i) compo, and (ii) compatibility with some very complex EU regulations covering the fundamentally complex electricity sector.  (Of course, these are illustrations of why Corbyn et al want out of the EU.  But any forseeable 'deal' won't let them off these hooks at all quickly; and No Deal will leave them with No Time for ideological indulgences like this.)  

b)  even if they can get past a), the sheer practical difficulties involved in the fatuous Grand Plan aspects will ensure nothing much changes in substance for a long, long time.  People really do insist on a continuous electricity supply!   And mostly, they have not the faintest idea how difficult it is.

c)  rationales A and B are non-starters.  I just mention this for completeness, really.  Costs will of course go up, not least because staff numbers will go through the roof as soon as they try C, plus the 'maximal union involvement' thing.  And no amount of well-meaning 'local community' enthusiasm will kick-start the Green Revolution, which will need to be a tightly-managed, highly technical affair.


All in all, we should be entirely delighted if this crazy scheme, which has obvious superficial attractions for all manner of lefty-greens, were to absorb all their energies right from the start of a New Regime.  A bigger distraction from more damaging potential forms of political meddling could hardly be imagined.  And of all the many baleful things McDonnell is plotting, this lunacy is by far the easiest to throw into reverse.

Keep watching this one: it's interesting.

ND