The EU thing

Well, here we are, at long last the referendum is to happen.  

Before the 2010 General Election both parties that formed the 2010-2015 coalition government promised an In-Out referendum.  Of course everything changed when the coalition agreement was forged.  The Conservatives couldn't agree to a referendum because the Liberal Democrats wouldn't agree the terms the Conservatives wanted, and the Liberal Democrats couldn't agree to a referendum because the Conservatives wouldn't agree their preferred terms.  It was all jolly convenient for the career politicians at the head of both parties for whom the European Union was the perfect model for established party elites to be guaranteed not just well-paid jobs for life but also political influence long after they lost electoral support in their own constituencies and countries. 

The repetition of that promise in the 2015 Conservative Party manifesto coupled with that party's win in the election forced the Prime Minister to do something about it.  His chosen course was a renegotiation of the terms on which the UK is a member of the EU and then the presentation of that new deal to the common people of the UK.  

Mr Cameron did not, in truth, have any other option open to him.  Successive manifesto commitments could not be ignored so something had to be done.  His choices were to give us a "take it or leave it" referendum against the existing relationship between the UK and the EU or to try to change that relationship and then offer the vote.  I am happy to accept that he went into the renegotiation on the basis he claimed - namely, with the intention to return certain law-making powers to the UK Parliament.  As it is, he returned with a deal that returns no law-making powers and merely tinkers at the edge of a few minor matters of detail on how existing EU laws will be implemented.  

I must make clear that I am not criticising Mr Cameron's achievements in the negotiation process.  I believe he achieved the absolute most that could be achieved.  He is a clever man, a determined man, a clear communicator and a Prime Minister who wants the best possible deal for the UK.  And therein lies the problem.  Despite his determination to return powers to the UK Parliament and the use of his clever and clear ability to communicate, he achieved nothing of substance.  

He never could achieve anything of substance because of two aspects of the way the EU works.  He was facing not only the self-perpetuating, superannuated bureaucracy in Brussels; he was also facing the honest and understandable national self-interests of the leaders of the other member states of the EU.  The bureaucracy would never allow a return of substantive powers and the other member states would never allow anything to be done to diminish their citizens' access to the benefits of living and working in the UK.  Against this background, to achieve even the tiny change he did is a matter of great credit to Mr Cameron. 

Since the referendum was announced we have been subjected to a bombardment of ludicrous guesswork about how an exit from the EU will affect the UK economy.  The simple fact is that no one knows how it will affect our economy.  Let me give an example of the main arguments I have heard on a central economic issue. 

Those in the "remain" camp assert that we will be excluded from trading with EU countries.  That seems extremely unlikely, although the terms on which we deal with them might well change.  How will they change?  No one knows.  What we do know is that we buy a greater value of goods from the other EU states than we sell to them, so excluding us from trading with them will (in monetary terms) hurt them more than us.  That doesn't mean we will necessarily be allowed to continue to trade without tariffs.  It's something that will have to be negotiated.  Whether - in the short, medium and long term - the UK economy will benefit cannot be predicted.  

Those in the "leave" camp assert, with great confidence, that we will continue to trade as we do now because we buy more from them than they do from us.  That is not necessarily so.  They will be much bigger than us and might use their ability to freeze-out our goods in order to secure a trading agreement which is to our detriment compared to the current position.  

In reality both sides are saying the same thing.  They both say that we will continue trading with the EU but they do not know whether the terms of trading will be the same.  So what?  If we stay in things will change that might or might not benefit the UK.  If we leave things will change that might or might not benefit the UK.  The whole economic argument is a nonsense because no one knows whether the next year of economic activity will be good or bad for the UK, or for France, or for Spain, or for Germany, or for Italy, or for any other country - be it an EU country or one of the 168 countries not currently in the EU.  

For me the most important issue in this referendum is not economic, it is political.  

I believe that the most powerful force in maintaining stability in any country is the general populace having the power to remove its current government and replacing it with another.  Everyone knows that elections every four or five years do not allow Mr & Mrs Ordinary direct power over everything.  They do, however, allow millions of Mr & Mrs Ordinarys to make their decisions and, if, collectively, they are so minded, to remove one government and replace it with another.  

There was, I believe, something very significant in the result of last year's general election.  Despite being bombarded by the BBC and every entertainer and "celebrity" who was given airtime that the Conservative Party promotes the interests of the rich and seeks to oppress the poor, that party was returned with a Parliamentary majority.  It was returned through the votes of people of all ages, races and levels of wealth.  A secret ballot allowing the quiet people to take a decision in private can overturn the consensus view of any self-appointed elite.  

For me the most important issue in the referendum, indeed the only issue of any importance, is the need for the people of the UK to be able to have as much control as possible over those who govern them.  That control occurs not just through the ballot box but also through the ability to influence politicians in numerous other ways.  Some of those ways are affected only very indirectly by the ordinary people, for example they have little direct influence over what the newspapers say and how television and radio stations report issues.  But opinions polls, phone-in programmes and petitions are legion.  In addition MPs attend their constituency surgeries and numerous public events at which views are expressed.  No doubt a huge number of people take no part in any of these means of communicating their views to their governors, nonetheless they are direct means of not only influencing politicians' opinions but also of holding them to account for their previously-expressed opinions.  

If you think our politicians are idiots you might or might not be right.  But they are our idiots and we can, in so many ways, hold them to account.  In my lifetime there have been so many that held high office but were rejected by the little people once they were accountable to Mr & Mrs Ordinary making a choice with a stubby pencil in a voting booth.  They had no right to political power unless it was given to them at an election because government exists for the people and not for the politicians. 

We have absolutely no control over the unaccountable powers of the EU.  We have MEPs but they have virtually no power - they cannot even introduce proposals for new legislation. 

I am a great believer in self-determination.  I believe in it for individuals and I believe in it for countries.  The more the little people have the ability to influence politicians, the more likely it is that those politicians will have to think carefully about every decision they make and the more likely it is that the parish, district, county, constituency and country will be stable.  Influence is not enough, the power to say yea or nae to a particular politician continuing to have the possibility of power is fundamental.  The two most high-profile recent examples are Michael Portillo and Ed Balls - politicians of the highest profile ejected from any political power by the greater power of the stubby pencil in the voting booth.  Long may it continue.  

Whether we stay in the EU or leave, the power to influence our own politicians will remain unless the EU passes laws to the contrary.  I don't expect it to, but it has the power to do so and there will be nothing we can do about it.  I would rather keep that power with Mr & Mrs Ordinary and their stubby pencils rather than with politicians who have been rejected by their own national electorates and been rewarded with more power as part of the EU commissariat. 

Self-determination has kept this country stable for a long time.  Long may it continue.  That is much more likely outside the EU than within.  

Let's not have a referendum

I suppose it should be mildly encouraging that the House of Commons is to debate and vote on whether there should be a referendum concerning the UK's membership of the European Union. The BBC informs me (here) that what will be debated is whether a referendum should be held giving the great British public three choices: (i) remaining in the EU, (ii) withdrawing from the EU and (iii) staying in but renegotiating the terms "in order to create a new relationship based on trade and cooperation".

My initial reaction was to wonder at the absurdity of offering three options. Nothing seems to be said about the proportion of votes required for any single option to be deemed the winner. Will it be more than one third or more than half? If the former it will lack legitimacy, if the latter it will set a very high hurdle for each option. 40% for staying in, 30% for withdrawal and 30% for renegotiation could be contrued as 70% for staying in but trying to change the unchangeable or as 60% for changing the status quo without any obligation on government to do anything about it. Either way it is completely unsatisfactory.

My second reaction was to ask whether there is any difference between the first and third options and, indeed, between the second and third options.

Staying in does not prevent renegotiation of the terms of membership, so option (iii) (if acted on by the government) merely adds a requirement to enter negotiations. What it cannot do is dictate the outcome of those negotiations because, by definition, negotiations only lead to a change if all parties to the discussion agree on a specific outcome. As I understand it an outcome in favour of option (iii) would not require the government to do anything, although it would be bad politics for them not to make at least a token gesture of trying to change the terms of EU membership. And even if they were constitutionally obliged to negotiate that would not guarantee any particular result.

Leaving the EU cannot take place in a vacuum. The UK has numerous trade treaties with countries around the globe, absent such treaties practical business cannot be conducted and just those sorts of treaties will be required if we are to deal in a sensible manner with the remaining EU nations. Withdrawal from the EU necessarily requires new treaties to be negotiated with the new, slightly smaller, EU because country-by-country treaties with EU members are not an option - the EU as a conglomerate has control over such matters. In other words, withdrawal will require negotiation "in order to create a new relationship based on trade and cooperation" - so what of option (iii)?

The terms proposed for a referendum look like a hopeless and confused committee-created fudge. A referendum on the terms proposed is likely to achieve only one thing, namely to kick the issue into the long grass for the foreseeable future. Only a straight in/out question is appropriate.

Chinese PM: "Scrap the Euro"

They're dashed clever these oriental types and they grow up in a culture in which loss of face is a serious matter. Whenever an established position needs to be altered you will not witness an admission of error or even of change of mind, the switch will be effected either by sacrifice of the career and reputation of the person nominated to take blame or by a series of gradual shifts of emphasis, each explained as an incremental development of existing policy in the light of new circumstances.

Their approach mirrors that of most modern western European politicians, these days only the rarest instance arises of an overt and admitted change of mind. Here in the UK we saw a sea-change in the mid and late 1990s as the spin machine of the Blairite Labour opposition pounced on any division, indecision or flip-flop on the part of the incumbent Conservative government. It was a well-organised (but patently dishonest) approach and it presented the image required for electoral purposes. Since then a united front and a consistent position have been seen as fundamental to the prospect of gaining political power, it allows only limited scope for a change of mind, indeed I would suggest the only exception is when both main parties have to abandon a previously advocated stance because of external factors.

The main players of the EU are even less inclined to change their positions, albeit for a different reason. No ballot box can oust them but they are on a mission to remove all powers from individual EU member states and create a single political system under the dictation of the EU oligarchy. In order to achieve this they must appear strong, so strong that national governments have no realistic chance of challenging or overturning the position the EU's permanent rulers have decreed to be correct. Perhaps the greatest exemplar of this is the Euro. The Euro is the means by which the aim of unified political control can be achieved. For some us it is also seen as the means by which unified political control can, should and will be defeated but that is not the topic for today.

Buttering-up the locals publicly is a necessary part of international diplomacy, often accompanied by quiet expressions of criticism being made behind the scenes. Criticising the locals publicly is an inevitable part of international power-grabs, often accompanied by soothing words of support to incumbent politicians in private until they are no longer of use. When it comes to business, the ideal situation to find is one in which others are acting in a way that will be of enormous benefit to your business in the long term. In that situation you would be mad to point out their errors, so you adopt your public diplomatic hat and say nothing else, safe in the knowledge that it will deliver you economic power that you could not achieve by criticism. That is what China's Prime Minister, Mr Wen, is doing very successfully during his short tour of Europe. We are told (here) he said "China will consistently support Europe and the euro." Well, yes, of course, he would be mad to say anything else. Supporting Europe is a fine sentiment that is totally without substantive meaning. The final three words are, however, in a different category.

Why would China want to support the Euro? A strong Euro zone full of throbbing economies making lots of goodies to sell to China would undoubtedly provide all the benefits history proves to arise from efficient, competitive production but the same would arise from those throbbing economies having their own individual currencies - as it did throughout the industrial era until the Euro was established. Portugal, Italy, Ireland, Greece and Spain (the PIIGS) are living proof that the Euro does not have magical powers and cannot turn idleness into profit or house-price bubbles into genuine wealth. The economies of these countries are not throbbing and nothing about the Euro can make them throb. If truth be told they would probably not throb outside the Euro but they would have the chance of stability at their own sustainable level of economic activity. Out of the Euro these countries can offer China greater trading opportunities than they can while still inside but that is not of any great interest to Mr Wen.

Mr Wen is playing the second half of the game China played during the boom years of 2003-7. Then China cashed-in on the additional money (I stress money, not wealth) sloshing about Western Europe due to the expansion of credit beyond sustainable levels. That it was not sustainable made no difference to China, it sent us washing machines and we sent it money. Washing machines lose value far faster than money, they need to be replaced so China says thank you and sticks another wad in the bank. Now that the PIIGS are having to face up to their earlier folly and are unable to ease their situation by devaluation, they need to raise money. The EU considers it necessary to keep them in the Euro zone and the only way that can happen is by increasing their debt enormously in the short term in the vain hope of something coming along later to allow repayment. One thing can come along in pretty short order, namely Chinese money. After all, China has lots of money in the bank that came from the PIIGS in exchange for washing machines and other jolly delights of modern life.

Buttering-up the locals is easily done when you have lots of money. The course chosen by China is to buy Euro currrency bonds issued by the insolvent PIIGS, to send a signal of confidence that is in fact nothing of the sort because they are safe in the knowledge that those bonds are essentially backed by all Euro zone economies (including Germany) due to the EU's need to support the Euro project. All the while the PIIGS will remain insolvent unless they can raise large sums of money. China is awash with the profits from years of washing machines, that is all very well except that cash can only fall in value over time whereas turning cash into capital assets stands a chance of giving a positive return over the longer term.

China's plan is to buy capital assets at below par value, a plan that is easy to achieve when the current owner is desperate for cash and is willing to hold a fire sale just to get something in the bank. It happened with the MG Rover site in Birmingham and it will happen with state-owned and privately-owned land and businesses throughout the EU. The UK and most of those in the Euro zone gave them the money to do so by creating credit we could not afford and spending it on Chinese goods, now that we need additional money (either because we are illiquid or because we are insolvent), the very money we created is being used to save us however in return we must give capital assets we can have no hope of ever recovering.

Of course China supports the Euro. Maintaining the Eurozone with its current participants means there are five countries (the PIIGS) in such dire need that there are rich pickings for Mr Wen and his merry men.

When Mr Wen says his country will support the Euro he is not giving it a Good Housekeeping Seal of Approval, he is shouting as loud as he can that the Euro is a disaster and must be scrapped to prevent the wholesale transfer of capital assets to his country.

They're dashed clever these oriental types.

Insurance premiums and Euro ideology - part two

My previous offering (here) did not cover one aspect of the debate about the effect of the decision of the European Court of (so-called) Justice in case number C236/09. As I said then, the court decided that the premiums charged and benefits paid under insurance policies must not discriminate between men and women. In other words, men should never pay more or less than women simply because they are male and women should never receive more or less than men simply because they are female. I offered some views on the premium issue but said nothing about benefits.

The good Mr Pogo raised a matter in the comments (here). He observed that annuity rates are generally more generous for men than for women and wondered whether the court's ruling would require this to change. The answer, I think, is that it depends whether an annuity is an insurance policy.

As I understand matters personal pensions work as follows. An individual pays contributions to a third party in order to build a fund from which a pension will be payable if he lives long enough. He could just save the money himself, but by paying it to an approved pension fund holder he is allowed to claim tax relief for his contributions. The pension fund holder collects the payments, invests them as well as it can, take a chunky commission at every stage and accounts to the contributor every year with a statement explaining just how little is being held in the fund. Each pension policy has a defined end-date. Provided the contributor has reached the age of 55 he or she may receive something back (it used to be 50 but is now 55). If he or she is younger than 55 at the relevant date, the fund is closed and the accumulated lump-sum is invested until he or she hits the magic age. At that time the policy matures.

I don't pretend to know many ins-and-outs of insurance law, but believe it is correct that these pension arrangements are a form of insurance. All insurance involves two factors: (i) you pay premiums and (ii) you are entitled to receive a payment if the thing you have insured against occurs (be it a burglary, a disease or, as in the case of pensions, reaching a certain age despite modern science decreeing that to be impossible because you smoke and drink). Entitlement to receive anything under a pension plan is dependent on a contingency and for that reason I believe it correct to say that pension plans are a form of insurance.

Insurance can entitle you to a fixed sum (you might pay premiums that entitle you to £5,000 if you break a leg bone - no matter which bone or how seriously it is fractured, you get the same sum) or to recompense for loss (as with home contents insurance), or to protection against claims others take against you (as in the case of professional indemnity insurance), or it might entitle you to a variable sum depending on how well the insurance company has invested its receipts. This latter course is how pension policies work. The heirs of those who die before the maturity date of the policy might or might not be entitled to claim a lump sum by way of refund and they might or might not make a claim, in any event some money will be left in the fund by those who cannot or do not get a refund. Some investments will be good, others will be bad. The fund will be what it is at the date a policy matures and the policyholder will be entitled to a lump sum calculated according to the state of the fund at that date.

When the policy matures, the policyholder is entitled to a lump sum but, if he claimed tax relief on his contributions, he is not entitled to receive it as a single lump sum. I believe a certain percentage can be taken in cash but the rest has to be used to buy an annuity. Many think this requirement iniquitous, but that is not the point of today's missive. The point is that the insurance policy comes to an end when the lump sum is calculated and paid. It goes without saying that all insurers large enough to administer pension funds also offer annuities, but their customers cannot be required to buy one of their annuities. The customer is entitled to a lump sum but must take that lump sum in the form of AN annuity, not any particular annuity. The purchase of the annuity is a separate transaction from the allocation of a particular lump sum to a particular policyholder on the date the pension policy matures.

At that date the policyholder has the benefit of a sum of money. Provided that sum of money is not calculated differently according to whether the policyholder is male or female it will not, I think, fall foul of the ECJ's ruling.

When it comes to buying an annuity men tend to get better terms that women because we don't live as long. Whether being the recipient of nagging shortens life or delivering nagging lengthens life really doesn't matter, it might even be a combination of the two, but the fact is that blokes generally don't live as long as gals. Annuities reflect this reality by giving men slightly better returns. It seems to me that that will not fall foul of the ECJ's decision unless annuities are insurance contracts. I cannot see that they are.

An annuity is a contract under which you pay a company a lump sum in return for being entitled to an income (paid weekly, monthly, quarterly or annually) for life. An annuity is no different from the cash-for-equity deals that are available to homeowners of a certain age. You make your house over and in return are entitled to a defined sum each year for as long as you live, it might even be index-linked, and you are also entitled to remain in the house. There is nothing about this that seems to me to equate it to insurance any more than purchasing an annuity is insurance. It could, I suppose, be argued that the lump sum is a premium and the receipts are benefits that depends on the contingency of longevity but that involves a contingency that causes payments to cease rather than one that caues payments to commence - and an essential feature of insurance, as I understand it, is that the entitlement to receive a benefit rests on a contingency other than payment of the premiums.

If this is correct, annuity returns are not caught by the ECJ ruling.

It's only a matter of time, of course.

Insurance premiums and Euro ideology

It is not often that men come out on the right side of anti-discrimination laws, but the slavish adherence of the European Court of Justice to a flawed principle seems to have produced exactly that result. I am, of course, talking about the recent decision that insurance companies are not allowed to discriminate between men and women purely on the grounds of gender when setting premiums or paying benefits.

The judgment itself (here) is clear. Where the position of men and women is comparable they must be treated the same. Where their positions are not comparable they may be treated differently. Who decides when their positions are and are not comparable? Well, the institutions of the EU of course and they have decreed that the situations of men and women are comparable when it comes to setting insurance premiums and calculating benefits payable under a policy.

In some respects this is patently absurd. Women are at greater risk of thefts in the street, (for example, handbags are easier to snatch than wallets in jackets) young men are at greater risk of crashing a car, men are at greater risk of dying younger, men are at greater risk of injury around the house (they climb on chairs to fiddle with electric fittings whereas women climb on chairs to scream "eek" at the sight of a mouse). These disparate levels of risk exist between the sexes but it is not their gender that causes the disparity it is their behaviour and different patterns of behaviour present different risks of an insurance policy being called upon. Because, generally speaking, men behave differently from women men present a greater risk for some types of insurance and a lower risk for others.

Throughout the world these self-evident facts have conventionally been reflected by higher premiums being payable by those most likely to present a claim. There are two aspects to this because insurance operates in two ways. On the one hand, some insurance exists primarily to pay the policyholder a defined sum in the event of certain things happening; for example you can take out insurance that pays you a lump sum in the event that you break a leg or suffer a heart attack, or you can insure the contents of your home so that you receive some money if you are burgled and your stuff is nicked. The only beneficiary of such a policy is the policyholder himself (leaving aside the right to nominate a different beneficiary but there are limits to when and how that can be done). On the other hand some insurance exists primarily to provide protection to third parties against damage done by the policyholder. Lawyers, architects, accountants and others have to carry insurance so that anyone suffering due to their negligence can be compensated; similarly car drivers take out insurance not just to compensate them in case a crash occurs but also to ensure that innocent third parties can be compensated. Strictly speaking third parties are not entitled to claim against these indemnity policies, instead the policyholder is liable to pay compenation and the insurance company provides the funds from which he pays it; although the reality is that the insurance is for the benefit of the third parties.

Whether insurance is primarily for the benefit of the policyholder or third parties, it involves shifting risk from one person (or group) to another. If you have no household contents insurance the removal of your goodies by little Johnny Toerag causes you a loss and you have to dip into your own pocket to replace the missing things, the risk is yours alone. By insuring against burglary that risk is spread among all policyholders. Equally, negligence by an architect might cause millions of pounds of loss which will fall initially on the owner of the building; the owner can sue the architect but will he have the money to pay? Perhaps not, so he has professional indemnity insurance to ensure there is a fund from which his "victim" can be compensated. In that case risk passes from the owner to the architect to all those who have paid premiums into the relevant fund.

There is no single principle by which the fairness of the spread of risk can be assessed but the conventional approach is to charge higher premiums to those who are more likely to make a claim and lower premiums to low risk customers; in addition the greater the size of any potential claim the greater the premium. Different people, and different insurers, can take widely divergent views about how premiums should be weighted. Some might think it fair for everyone to pay the same premium, or for premiums to be graded according to the income of each policyholder, or to vary according to the area in which the policyholder lives, or according to his age or his occupation. Arguments can be made for each of these factors to be given particular weight in certain situations. What is considered fair is a matter of opinion and opinions necessarily vary.

I have read a lot of comment in the last few days about the judgment of the ECJ being unfair to young women drivers who, apparently, are much less likely to make a claim on their motor insurance than young men of the same age. It certainly appears to be the case that insurers will not be able to charge young men higher motor premiums than young women because that would involve unlawful discrimination on the basis of gender. I find this a slightly confusing concept. There is a reason why young men's premiums are higher - it is because, as a class, they are more likely to make claims. Not every one of them is a menace, but sufficient are to make them a risky group - not by way of anecdote but by way of hard evidence about the number and type of incidents in which they are involved. That is fact, that is reality. For reality to be cast aside in favour of a political ideal strikes me as highly unappealing.

Having said that, all weighting of insurance premiums requires judgments to be made about what is and is not fair. When I last had a big car and its insurance was due for renewal I obtained quotes varying between about £350 and just under £2,000. Same car, same location, same driver with decades of experience and not as much as a speeding ticket, yet one insurer assessed the risk I posed as requiring a premium five times higher than another. No doubt each felt they were chrging what was fair in the circumstances.

We shouldn't get too uptight about car insurance. Maybe premiums will go up substantially for young women, maybe they will fall a bit for young men, maybe they will rise for older people to allow premiums for the young to find a level between the current male and female level. Whatever happens there will continue to be wide differences between insurance companies' charges.

More troubling is the illustration given by the recent ECJ case of the consequences of pushing ideology into areas that are none of its concern. I have no problem with the concept of men and women being treated equally by the law, but I find it ludicrous that the law requires anyone to pretend that differences that actually exist as a matter of fact between men and women do not exist. There might be a simple way to avoid this absurdity. It arises only because the EU has decreed that the position of men and women is comparable so far as insurance premiums are concerned. As a matter of fact that is simply not the case, at least it is not the case when it comes to motoring premiums. The EU could, were it so minded, allow insurers to charge men and women different premiums where there is clear evidence that men present a higher risk than women or vice versa. That, indeed, was the position until it was struck down by the ECJ because it was inconsistent with another provision of EU law.

If we have to have EU law (and the sooner we don't, the better) it should at least try to reflect reality. I doubt that it can ever do so to a sufficient degree to gain public support because it is systemically ideological rather than practical. It is not just Middle Eastern despots who can only bully their subjects for so long before they are ousted.

To judge the EU, judge the Euro

I have never been one for grand conspiracy theories except in one area, the European Union. Even then I don't go for the more sinister accusations about the intentions of our friends in Brussels (then Strasbourg for a few days and then Brussels again). I cannot accept that the intention of (most) of those behind the EU project is to create a brutal totalitarian state, rather I think they probably believe that political and economic integration based around a single bureaucratic, not democratic, Europe-wide government will be of benefit to the little people. In order to seek that end the grand pooh-bahs of the European integration project have lied about their intentions since those intentions were first formed.

Across the English Channel lying is part of the normal currency of business and personal relations. Here in blighty it is generally looked on somewhat differently, as the conduct of a scoundrel. The French know their politicians lie all the time and don't care because they don't consider much wrong in the telling of an untruth. We know our politicians lie all the time and it raises our blood pressure because we believe it makes them unfit for office yet still they get big salaries.

That is not the topic of today's meandering, I just wanted to say it. Today's topic is not about how they seek to impose their hidden agenda but about something much more fundamental - the structural problem that undermines the whole concept of EU economic integration and the Euro in particular.

It is a problem that affects the UK as well and can be illustrated by manufacturing. Although manufacturing industry has taken quite a battering as developing countries have been able to undercut the prices UK producers need to charge to break even, we still make a lot of stuff. In fact I recall reading somewhere that we are the ninth or tenth largest manufacturing economy in the world, it didn't sound right to me but it might well be because we have a lot of small factories producing specialist stuff and a few big manufacturing plants remain and what we sell tends to go for quite a high price (if it didn't we couldn't afford to produce it).

Those that use predominantly home-produced raw products and sell predominantly to the home market are affected almost exclusively by domestic economic conditions. Those that import raw materials and sell in the home market want the pound to be strong against the currency in which they must pay for their supplies. Those that use domestic raw materials and mainly export want the pound to be weak so that their goods can be sold cheaper overseas and undercut competitors. Those that import raw materials and sell overseas will be less affected by the pound rising or falling in value - a rise makes materials cheaper but sales more difficult and the reverse is seen when the pound is weak. Within England there exist thousands of businesses that want a strong pound and thousands that want a weak pound. It is impossible for both camps to be satisfied all the time. So it is also with interest rates. Some businesses benefit from rates being high and others can only survive if they are low. You can't keep everyone happy all the time.

If there were a government for a county that is heavily dependent on imported materials it would be reasonable to expect it to aim for its currency to be strong (so that things manufactured there for export will be cheaper for the customers). By contrast the government of a county heavily dependent on tourism would want Johnny Foreigner to come in droves, so it would work towards a currency that is weaker than its rivals in order to maximise the chance of attracting business. As it is, within the UK we have massive differences between different counties and a single currency, the pound, applies to all. Some gain and some lose when the pound falls or rises in value compared to other countries. We put up with that because what ties us together as a single country is much more than economic interests.

Not so, the Euro zone. No matter how much each country tried to manipulate its interest rates, exchange rates and trade cycles to try to find common ground with other Euro zone countries before joining the club, fundamental differences between the various national economies would always remain and will change as time moves on - some will become more dependent on manufacture, some more dependent on services, some more dependent on leisure and so on. Just as strains arise between different areas of the UK in certain economic conditions so they arise between Euro zone countries. The difference is that cultural and historical ties exist to keep the UK as the UK (until we have the good sense to let Wales and Scotland free to spend only their own money) whereas the only ties binding the Euro countries are those created by the Euro itself.

The collapse of the Greek economy illustrates a consequence of the structural problem behind the entire Euro experiment. In a sane world Greece would allow its currency to fall until it found its natural level - the level at which those who do not trade with Greece will find it attractive to do so thereby allowing the Greek economy to stabilise. It might also need a bail-out from the IMF, or the US, or China, or David Beckham because its governments have been absurdly profligate for years, but it would not be constrained by its currency having an international value that simply does not reflect the reality of Greece's position. That constraint will continue for so long as it is in the Euro zone because the exchange rate of the Euro is determined not just by how the rest of the world sees Greece but by how it sees the whole package of Euro zone countries.

More importantly, the rise or fall of the Drachma would have influenced Greek economic policy and might (it is no more than a possibility) have prevented the collapse we have seen recently. The Euro bureaucrats had no way of sending a message to the Greek people that things were going wrong and no inclination to do so because the very existence of the Euro project has always been more important to them than the Euro's effectiveness as a currency.

Having a single exchange rate and "official" rate of interest does not suit each county in the UK let alone each country and province. It is tolerated for reasons that have little if anything to do with economics. Having a single exchange rate and official interest rate for all Euro zone countries cannot work in the long term because the time will come when it will not be tolerated by those whose financial position suffers beyond the limit of political endurance.

We might be getting close to that point, the sooner it arrives the better. With any luck it will expose the whole EU project as the political equivalent of the Euro.

Recycling and the balance of power

Were I to take up the patio at FatBigot Towers and lay a new one I would have to dispose of the old paving slabs and incedental detritus. It's not the sort of thing you can put in the dustbin so I would have to hire someone specifically for the task. There are lots of such people around, for a few quid they will take just about anything. I have used them a few times over the years.

It was an interesting experience. By the way they carried on anyone would think they were providing a service and their customer was paying their wages. An appointment was made to my convenience, a couple of burly chaps wearing thick leather gloves traipsed over the finest tufted Wilton, followed by a boy with a little battery operated vacuum cleaner. The heavy stuff was collected, carried back the way they came and the boy ensured any crumbs of concrete or mud that fell to the floor were picked up immediately. I handed over some small paper portraits of Her Majesty, they said thank you and all was well with the world.

I wasn't doing them a favour, I was paying for a service. They weren't doing me a favour, the were providing a service in return for money. It was a perfect example of what a service is - the provision of something that one person wants or needs and either cannot do himself or cannot do as efficiently and easily as someone else.

The world of normal domestic refuse disposal seems to operate in a different way these days, but it was not always so. There have always been two aspects to refuse disposal, it not only gets rid of stuff that would otherwise get in the way but there is also a serious public health aspect by which waste products that might cause harm or attract vermin are removed and disposed of more safely. This is very much a service and, like my blokes with thick leather gloves, must be paid for or it cannot be done. I have no doubt that it is the single most important function of local government in the UK.

And to my mind it is a legitimate function of government because the health aspect is so important that only a branch of government, with the power of compulsion can ensure the risks of uncollected waste are kept within reasonable compass. Compulsion in this field is required for two reasons. First because the service must be paid for and that requires compulsion. Just as a private company providing a service can sue its customer for not paying the bill, so a council can take legal proceedings against those who fail to pay Council Tax (that Council Tax covers matters other than refuse collection is irrelevant for these purposes). Secondly because there can be risks to innocent third parties if someone does not dispose of waste there must be a back-up mechanism to ensure that potential harm is minimised. It might be that the waste itself presents a health hazard, or that it creates a nuisance through smell or that it attracts vermin; each of these is serious if you are living next door to it. But that is as far as compulsion should go in order for the council to provide the service we all want and need. By going that far and no further, compulsion is consistent with refuse collection being something done for us by the council.

Where things have become skewed is in relation to so-called recycling. I opined on recycling some time ago (here), the point I want to make today is not about the recycling process itself but about the way it has been used to change the very nature of refuse collection. Now it is not just a service provided by the council for us and for which we pay, now it is also an obligation we owe to the State and for which we pay even more than before. The additional payment is a result of the absurd EU landfill tax that requires councils to pay, I believe, £59 per ton (or perhaps tonne) of waste sent to landfill sites. Councils don't want to pay more of that tax than they have to, so they seek ways of reducing the amount they send to landfill.

It operates in different ways in different areas, according to what arrangements the council has made for recycling. Some take cardboard, others don't have a deal with a cardboard recycler; some find it more cost-effective to have householders separate glass from plastic, others find they can do it better and cheaper themselves; some take green waste, others think the cost of dealing with it outweighs the saving in tax; and so it goes on. I have no reason to think these things are not thought through and assessed very carefully by each council because the financial ramifications are significant.

Everything depends on what they can negotiate with recycling companies and whether the cost of recycling is higher or lower than the landfill tax. Actually not everything rests on that, some councils are so infested by manic Greenies that they happily waste money recycling despite it not being cost-effective. Nonetheless, the economics of the practice are important for all of them.

One consequence of the need to recycle (whether that need is driven wholly or only partly by the landfill tax) is that a new area of compulsion arises. If we little people do not sort our recyclable rubbish from our other rubbish there is a penalty for the council. That penalty is primarily through paying more landfill tax than is necessary although there is also legitimate democratic pressure on council officers to comply with every mad policy adopted by Greenie councillors; either way they either accept the penalty or they have to force us to help them avoid it. Of course they dress-up fixed penalty charges as necessary to "save the planet" when they are nothing of the sort, they are imposed in order to change behaviour so that the council keeps its costs down and does what elected councillors require it to do.

Refuse collection is still a service we pay the council to perform but it now has an additional layer in which the roles are reversed. Part of the process is now a service we perform for the State. Where doing so helps to keep down the cost of refuse disposal there is an obvious benefit to us, but only because of a tax that has no point in this country because we have centuries of landfill capacity. The cost of that benefit is that, in yet another area, our ordinary everyday lives involve an obligation to the State that previously did not exist whilst at the same time the cost of the State providing a service to us is increased. Isn't it odd how both EU and Greenie policies almost always result in that double-whammy for the little people?

There is a way out of part of the problem. Councils could collect everything, sort it themselves and make clear that the additional cost is due entirely to EU and Greenie initiatives. It might be more expensive than imposing obligations on householders and issuing fixed-penalty fines for non-compliance, but it would ensure that the balance of power between the State and the ordinary people is moved one tiny notch in favour of the latter.

What not to do about the BNP

Labour chose one of its smoothest liars, Peter Hain, to represent the party on Question Time this week. Unlike some I don't object to Mr Hain's permanent orange pigmentation or to his history of engaging in illegal actions to further causes in which he believed. If someone is prepared to say "I believe strongly in this and am prepared to break the law and face a fine or imprisonment for doing so" they are, in my view, acting honourably if, perhaps, foolishly. It doesn't matter what their cause happens to be nor how many others support it, having the courage of your convictions, even if it leads to criminal convictions, is to be commended. Of course now he is a fully-fledged slime machine and all principle was discarded long ago in his search for personal fame, power and glory. Once an honourable man he has followed the well-trodden path of losing his honour in order to gain the title "Right Honourable".

Tonight he was on fine form. Talking with a straight face about the government's plans for spending he adopted what appears to be the official line of speaking only in cash terms without making any adjustment for inflation. So he spoke of increases in spending until 2014 when the government's own figures, published at the time of the budget, make clear they plan a modest cut within less than two years from now once inflation (at a very modest predicted level) has been taken into account and quite a substantial cut by 2014. This is exactly the same tactic used by Gordon Brown at Prime Minister's Questions on Wednesday. There was a simply bizarre exchange in which poor Gordon accused the Conservatives of planning a 10% cut in public spending when all the opposition had done was point out that by ring-fencing spending on health and international development all other spending would have to fall by 10% in order to match the government's own announced spending plans. So his plans, announced by his puppet Chancellor at the budget, are treated by him as an increase in spending if carried into effect by Labour and a cut if carried into effect by the Conservatives. This is not just spin it is a calculated and deliberate lie which Mr Hain was happy to adopt and shout to the rooftops.

I mention that as an example of Mr Hain's blatant dishonesty but it is not what I actually want to discuss today. I want to discuss his approach to the election of two BNP MEPs. For any visitors from overseas I should explain that the BNP (British National Party) is a fringe party of malcontents. On the two great policy areas, the economy and foreign affairs, their position is identical to that adopted by the Labour Party under Michael Foot in the early 1980s. They argue for widespread nationalisation and a state-command economy combined with withdrawal from the EU.

If anyone is minded to doubt the comparison, take a look at the published policy statements. Keele University helpfully archives manifestos from the main parties and Labour's 1983 manifesto can be found here. If you have the patience to read through the document you will see that they argue for the state to have a command position in the economy. Of particular interest is the section headed "Rebuilding our industry" in which they planned not just the nationalisation of certain industries that were then in private hands but a wholesale creation of new industries by the state and under direct state control. Included in their plans was requiring the banks to do what the government wanted or be nationalised. On foreign affairs their headline policy was withdrawal from what was then the European Economic Community.

The BNP's manifesto for the recent European Parliament elections dealt clearly with their plan to withdraw from the EU, although it said little of substance on anything else. Their economic policy is set out in their "mini-manifesto" from 2007 which calls for the economy to be run by the state and in an article they published in April this year entitled "How the BNP Will Rebuild Britain's economy". Their approach is for the state to manage the economy in the same way that Labour wanted in 1983.

One major difference exists between the BNP in 2009 and Labour in 1983. It is that the BNP wants to exclude people of dusky hue from the country and "repatriate" many who are already here. Ironically the BNP wants to press the bankrupting forces of state socialism on only pasty-faced whities whereas Labour wished to spread the misery more widely. The reason I mention Labour's 1983 Manifesto is that Peter Hain first stood for Parliament in 1983, without appearing to distance himself from the party manifesto. Of course he stood for election subsequently on different policy bases but he can hardly complain about the BNP being an extremist party when its central economic and foreign policy platforms are the same as those on which he first sought election to Parliament.

When asked to comment on the recent success of the BNP in the European elections he expressed distress that Britain has sent two "fascist" (as he called them) MEPs to Brussels. I happen to agree with his definition of the BNP as a fascist organisation but on a wider basis than him. It is not just their absurd policy about pigmentation that makes them fascist but their demand for state control. The latter has been the constant feature in fascist regimes, not all of which have also included a racial or pigment-based element to their platform (although almost all have added one at some stage in order to secure their power-base through the practice of divide-and-rule).

That, also, is not what I really want to say today. What I really want to say is that he is wholly and hopelessly wrong in saying that this country is sending fascists to the EU Parliament. The two men in question won seats because individuals voted for their party in sufficient numbers in two of the voting areas. We can never know how many of those individuals did so because they want to kick the "darkies" out, or because they were persuaded by the policy of withdrawal from the EU, or because they want a control economy, or because they support any of the other things the BNP argues for; nor can we know what combination of factors every individual found persuasive; nor can we know how many of the votes were pure protest votes against the government or the current Parliament or, indeed, anything else. All we know is that sufficient people voted for the BNP to allow two of their candidates to win seats. They are validly elected MEPs, just as much as any MEP wearing a different party badge. This country is not sending any MEPs to Brussels, the voters are sending them.

All the pious hand-wringing in the world cannot change the fact that politicians are subservient to the electoral system and have no right to complain about its result. To argue that the outcome has produced an undesirable result is to argue for a different electoral system under which the views of the little people should bear less weight and have less ability to upset the established elite's apple cart. That is to approach the matter the wrong way round. The question is not "what can we do to prevent the country producing these results?", it is "what can we do to persuade those who voted in this way to vote differently?" Fiddle with the electoral system and you cannot quell discontent all you can do is prevent that discontent being expressed through the ballot box; other methods will be found by those sufficiently angry and the rest will fume at being marginalised.

Mr Hain and senior figures in the other major parties must address the reasons for discontent if they are to justify their continued existence at the top table. Condemning the outcome of an election is to condemn the voters, always an unwise decision for a serious politician.

I don't know where to place my "X"

It's getting close to the time I have to decide. Where should I place my little "X" on Thursday? The only elections in London are for the Euro-Parliament, so the outcome is irrelevant to anything. I'm not concerned about the results, it will make not a jot of difference to my life or that of anyone else in London if the eight available seats all go to the Conservatives, Labour or even the Monster Raving Loony Party; the Parliament has no real power and individual MEPs have no effective representative role to play. For me, Thursday's election is not about the European so-called Parliament, it is about momentum in the run-up to the next general election.

I can discount four possibilities immediately. Voting for Labour, the LibDems or either of the national socialist parties, BNP and Green, is a non-starter. I'd rather urinate into the very fine mulligatawny soup I made this afternoon. So should it be Conservative or UKIP?

Voting UKIP this time is something of a two-edged sword. In the past it has been a fair bet that UKIP's strong showing in Euro elections was evidence of the degree of distaste for the EUSSR project. It achieved little in swaying the main parties towards the Eurosceptic cause in their avowed policies however it is noticeable that neither Labour nor the Conservatives has argued for further centralised power to be held in Brussels (although some of us might think their actions have achieved exactly that end). Sending a message has always been part of local and Euro elections as well as Parliamentary by-elections. The issue of one-world, post-democratic government has never been more serious and the chance of extricating ourselves from the stranglehold of Euro-fascism hasn't been greater since the 1975 referendum. A strong showing for UKIP could help to move the argument away from the pro-EU consensus dominating the official line of both Labour and the Consevatives.

I am not much deterred by UKIP being essentially a one-man show. Nigel Farage, for all the tales of his drinking and womanising, is a highly proficient operator and a good spokesman for his party's cause. I know virtually nothing about any other UKIP candidate but that really doesn't matter because, as I have explained above, for me this election is not about the European Parliament. The more the main parties seek to portray UKIP as a one-trick pony, the more attractive a vote for them appears because it allows UKIP votes to be seen for what they usually are - votes to get out of the deeply corrupt EUSSR regardless of any other policy they have.

Things are rather complicated by the MPs' expenses issue; not because UKIP has anything to do with glittery lavatory seats and "flipping" but because a vote for a fringe party can be construed as a protest vote and nothing more. The benefit from signifying disgust with the EUSSR will be diluted.

The other option is to vote Conservative, which is not an easy choice because of my firm opposition to their official line on the EU. Yet if I cast my mind forward to the general election, the wider the gulf between them and Labour this week, the greater the chance of the Labour machine becoming even more demoralised than it is already. For me there is no more important political task than to replace this bankrupt government with something better. Then I have to ask what the replacement will be and it's not exactly a cornucopia of sweetmeats. They are still wedded to the EUSSR project, they are still wedded to the concept of big government, they are still too mindful of opinion polls to put forward the sort of radical shift in power from the State to the little people that we need. Mr Cameron says some encouraging things from time to time but he said some awful things when he thought they would be popular; it is hard to see a strong vein of principle running through his various pronouncements.

So it's either UKIP to try to shift the debate firmly in the Eurosceptic direction or Conservative to try to screw down the lid on the Labour coffin. The former might reduce the momentum required to achieve the latter and the latter might be premature and allow a bounce-back by encouraging all the sad old Trots to put aside their superior disdain for the democratic process and turn out to boost the leftist vote. After all, we must never underestimate the power of religion. Socialism is the opiate of the people, nothing else can explain the current government being able to command loyalty from around a quarter of the populace in opinion polls. Hit them too hard now and they might be able to rouse the apathetic troops of the hard left.

It's not an easy choice. What is easy is to say that I will not disclose how I vote. I am happy to let anyone who cares to listen, and even more who don't, know where my general sympathies lie, but my vote is a very personal thing. It is mine. All mine. I have it because people like my father risked their lives to quash a previous plan for the EUSSR. I will walk to the polling station with a spring in my flabby step and remember how lucky I am to have the right to apply the pointy end of a stubby pencil to a piece of paper and exercise my tiny little bit of influence. With any luck I will have made up my mind by then.

Euro-elections and MPs' expenses

We are now just a couple of weeks away from the elections to the European Parliament and little is being heard about it above the noise of the expenses scandal. I have tried casting my mind back to the last lot of Euro elections to see whether I can remember there being much excitement then, sadly, memory is there none. Why, I wonder, can't I remember? I remember general election campaigns and even some aspects of local election campaigns, but nothing about Euro elections.

I think it's probably a consequence of what Euro elections are. Voting for an MP or local councillor means voting for someone with a direct part to play in the implementation of policy and the making of law (Acts of Parliament in the case of an MP and by-laws in the case of a councillor). The number of MPs/councillors elected for each party determines the form of the national or local government that rules over us. For all the deficiencies and quirks in the first-part-the-post constituency system and, indeed, in the amount of power political parties have over elected representatives, at least the outcome of the election decides who governs and sets the strength of their nominal majority in the chamber. Returning an MEP to Brussels has no discernible effect on policy or on the structure, form or political balance of the ruling EU elite.

So what can we vote for in the Euro elections? What issues are there? It seems to me there is really only one issue and our votes are just a glorified opinion poll on that issue - do we want to stay in or do we want to get out? The policy of all three main parties is to stay in the EU. They don't campaign by promising they will actually achieve anything if elected because they know they can't; they angle for support because votes in any election strengthen their overall domestic position.

An interesting side-issue arising from the MPs' expenses fiasco is that it shows how public opinion can bring about change regardless of the voting strength of the parties in the House of Commons. Fiddles of a few hundred pounds here and there have raised a stink just as much as profiteering by tens of thousands on sale of a house paid for by the taxpayer. Neither the government nor the opposition parties can ignore the fuss because it is engulfing the whole country, there is simply no buffer between them and us, no insulation to allow them to carry on as they wish. By contrast far greater corruption goes on within the EU institutions. MEPs can and do draw many thousands in perks, allowances and so-called expenses. Commissioners receive substantial salaries and simply enormous fringe-benefits including pensions so sweet they would make real people cry. When exposed to howls of derision among the little people over the failure of the EU's accounts to pass audit and the lack of controls over MEPs troughing, nothing changes. Nothing changes because change can only come from the self-appointed EU elite who are not subject to any direct pressure from the serfs. They serve their time, pick up their massive salaries and are replaced by their friends. Neither the ballot box nor public opinion has any influence at all.

The row over MPs' expenses shows a strength of our democratic system. When something is sufficiently repugnant to normal standards of fair play there are avenues through which it can be addressed. Those avenues are not restricted to the ballot box. Genuine disquiet can cause a major change in Parliamentary procedures or in government policy whatever the result of the most recent general election. The effect of public opinion does not operate outside the democratic system, it is part of it. Indeed it is more accurate to say that elections are just one way in which public opinion influences the way we are governed.

Public opinion is irrelevant to the workings of the EU institutions. It is irrelevant because there is no mechanism for it to operate on those workings and, more significantly, it is irrelevant because the institutions exist not by the will of the people but by the will of a self-perpetuating political elite. It is an elite that has devised a system to give it powers wholly removed from the democratic process. If we ever want an example of the importance of retaining a direct link between the will of the little people and the activities of a ruling elite, the expenses row is it. Manipulation of expenses rules to the personal benefit of MPs existed because it could. The corrupt ones, supported at every turn by the hopelessly incompetent trougher-in-chief known as the Speaker, fought tooth and nail to keep their practices secret but eventually the truth came out and now they have to face the consequences. For many of them those consequences will be dire, so be it, that's the price you pay for cheating. Yet that price can only be exacted for so long as there are both means of exposing corrupt practices and the will to combat those practices. The latter is wholly lacking in the EU institutions.

In or out? That's an easy question for me. Contrived arguments about the EU having kept the peace in Europe can be stuck where the attendance allowance doesn't shine, not only are they factually unsustainable but they are also now irrelevant. Dissolve the whole EU today and there won't be war or any threat of war between France and Germany - forget Italy, Spain and the rest, the only fear of serious western European war in the last century has involved those two countries. Contrived arguments that a free market, or anything approaching a free market, between European nations requires centralised political control are patently absurd. Both the EU and the USA have defined free-trade agreements with numerous countries without any need for the blending of governments. Arguments about how much money membership of the EU costs the UK and how much departure from the EU would harm our economy are neither here nor there. Figures given by protagonists on both sides are always selective, hypothetical and/or exaggerated. If we gain, great. If we lose, we lose.

To me it is a matter of self-determination. Only self-determination by nations states can create the circumstances necessary for stable society (I have opined on this point before). Only a direct link between the will of the little people and the power of the ruling class can keep political misbehaviour and corruption to the minimum. That link is impossible on any scale larger than the nation state and, let's be frank, it's difficult enough even in a small country like the UK. Leaving aside any other aspect of the in-out debate, this one is utterly persuasive for me.

What do we vote for?

I received my voting card today, informing when and where I must go to vote for the forces of good in the forthcoming European Parliament elections. It got me thinking about something I find both interesting and amusing.

The very nature of our electoral system is that we cast our vote but there are no rules about what we should or should not take into consideration when deciding where to put our mark. There is a very obvious reason for this because we can decide on whatever grounds seem important to us, or on flippant grounds or on no grounds at all, we can vote tactically to prevent the election of someone we don't like even if the result is that someone we dislike a little less gets in, we can vote for a candidate knowing they have no chance whatsoever of being returned; it is a complete free-for-all. There can't be rules about it because there is no one to make such rules and no way of enforcing them.

One effect of free votes is that a particular candidate can succeed despite a clear majority not supporting any of his policies. If you need 15,000 votes to win and can attract 1,000 votes each from single issue fanatics on fifteen different issues, despite them not supporting anything you say on any of the other fourteen fanatical issues or any other issue, then you will be elected. Fair enough, although it's probably unlikely to happen. At least it's unlikely to happen in a general election where core issues tend to come to the fore, particularly if there is a realistic chance of a change of governing party. Nonetheless, it is inevitable that inconsistent reasons will lie behind the majority achieved by each successful candidate.

During every election campaign I can remember there have been debates on television and radio about what people think their vote is for. Some will argue that we should all vote for the candidate who will be the best representative for the constituents, others will argue that choice of party is more important and others still that a general election is really a vote for your preference as Prime Minister. People get quite unnecessarily heated about this when the reality is that each argument is valid to those who find it valid. If Mr Ordinary uses his vote for his party of choice and Mrs Ordinary for her preferred Prime Minister, each is equally in the right because it is a free choice to do what you want with your vote according to your personal judgment. In all but the most extraordinary of circumstances nutty and emotive issues are swamped by more general considerations, hence the changes of governing party in 1979 and 1997 and the fluctuating majorities held by those parties during their recent periods in office.

I still read suggestions that the current government is somehow illegitimate because it only polled 35.3% of votes cast at the last general election and each time I do I sigh and think of apples and oranges. They received 35.3% of votes cast under the current system of first-past-the-post constituency elections rather than proportional representation. Having won a majority of seats they are the legitimate government, no matter how much I dislike that fact. No one can say how many votes they would have received under any of the many versions of proportional representation nor what effect it would have had on seats won in the House of Commons.

I also read assertions that Gordon Brown is not the legitimate Prime Minister because he was not leader of his party when the last general election was won and Tony Blair said at the time that he intended to serve a full term in office. That assertion, too, is without substance. Under the system we have the leader for the time being of the majority party is invited to form a government, if he or she stands down and a new party leader emerges that new leader will be invited to form a government. You can't sensibly ignore one aspect of the whole process and claim that it removes legitimacy from someone appointed under the process that was in place at the time of the election. Poor Gordon is the legitimate Prime Minister, albeit a hopelessly incompetent holder of that office, just as he would have been had Tony Blair been run over by a bus a week after the election.

A highly visible aspect of voting decisions being affected by differing considerations is the way things happen in by-elections compared to general elections. The issues are different and having the spotlight on a single constituency allows attention to be brought to particular local and topical matters on which the incumbent government has a less than unblemished record. Innumerable examples exist of protest votes at by-elections resulting in the governing party losing the seat, only for it to be regained at the next general election - of course that doesn't always happen but historically safe seats for one party tend to revert to their usual holder.

European elections raise yet further issues. Support for the UK Independence Party soars far above its level at general elections because all three major parties seem keen on Belgian gravy being a fatty product whereas the people would prefer it to be weak and watery. In a way it is curious that elections to the European Parliament tend to revolve around our views of the EU and its institutions rather issues of policy because something like 80% of our laws now come from Europe. But then it is not really curious because any views on policy expressed by the electorate of one country out of twenty-seven are of no importance to the Brussels machine.

It will be interesting to see how far the vote swings against Labour at the upcoming Euro elections. There is little difference between the position of all three major parties on the EU so there is no reason to read a loss of votes for Labour as reflecting anything about their position on matters continental. Of course we can never know why people will vote as they will, but that won't stop the speculation, and jolly good fun it will be too.

Poor Gordon's millinery conundrum

The excitement is mounting in anticipation of the G20 meeting in east London in a couple of days. I'm sure I read somewhere that it is expected to cost the UK taxpayer around £50million. There's not a lot we can do about that, these self-indulgent beanos are going to take place whether we like it or not and whether or not they have any chance of achieving anything, every so often it has to be our turn to pay for the tea and biscuits.

Although I am always delighted to witness poor Gordon being humiliated, it is quite a relief that President Obama decided to attend after early doubts; the fall of my country down the pecking order caused by a Presidential snub would have been painful.

What intrigues me today is which hat Gordon will be wearing. In his brief time as the worst Prime Minister in history he has plonked a wide variety of headgear atop his overheated brain. No doubt one consequence of being out of his depth is that he cannot maintain a consistent position. Not only is he constantly buffered by events, a risk for any political leader in current circumstances, but he has actively volunteered inconsistency in some of his most important and widely publicised speeches.

Right at the start of his time as Prime Minister he made his first leader's speech to the 2007 Labour Party Conference. When addressing the issue of the EU he said "At all times we will stand up for the British national interest. And I accept my responsibility to write in detail into the amended European Treaty the red lines we have negotiated for Britain." Fair enough, that's nice and clear, he recognised that the interests of the UK are different from the interests of other European countries. No one will dispute that, all the other European countries feel the same about their own national interests.

So how does this play when he is talking to Europe? Last week he made an excruciating speech to the European Parliament in which there wasn't, of course, any mention of differences of opinion but praise for the EU working together and forging an alliance with the USA to lead the world to a promised land of ... well, it's not clear what exactly, but it's going to happen because The EU is a single entity with a united position on everything. "I passionately want Europe to be leading on the world stage", "I propose that we as Europe take a central role", "I propose that Europe takes the lead". All good stuff but hardly consistent with putting Britain first.

And how does that compare to his speech to Congress a couple of weeks ago. Oh dear. On that occasion it was Britain and the US marching together and leading the world to fresh green pastures. A footnote, long after the glorious unity of the UK and US had been flogged to death, contained mention of Europe. But there was no "Europe is leading and you are coming with us", it was "America and Britain will lead and succeed".

So which hat will he be wearing this week? British, European, UK-US or EU-US? Perhaps he has been busy designing a new bonnet, just in time for Easter.

Whither the national interest?

Back in the dim and distant past of the pre-New Labour era we used to hear a lot about the balance of payments and the national interest. They were central to government policy yet they have now both disappeared from view.

The balance of payments was the difference between the value of stuff we exported and the value of stuff we imported. Figures were broadcast every month for tangibles and invisibles. Very often we were in the red in tangibles (actual things like cars and cabbages) but in the black for invisibles (such as banking and insurance). It mattered because we were competing against other countries and needed to know how we were doing. At least we thought we needed to know, that we don't get any figures these days suggests it might not have been necessary at all.

Except that it was necessary. It was necessary so we could judge whether we were getting things right or wrong. Just as a business needs to know whether it is making a profit or a loss in order to be able to judge its performance and make any necessary changes, so the country needs to know the same if it is to address systemic problems in the economy. Of course the figures have been available, they just haven't been published as widely as they used to be.

The national interest was the overriding concern of government, however dismally any individual government protected it. The UK government held a mandate from the people of the UK and felt it necessary to act in what it perceived to be the best interests of the UK. If France or Germany or, if it comes to that, Swaziland proposed something considered detrimental to this country the government would speak against it. Act against it less often, but speak against it every time. The concept of the national interest recognised that we are in competition with other countries. It also recognises that the first priority of the UK government should be to protect the interests of the people of the UK.

We just don't hear about the national interest these days and we don't hear about how well or badly this country is doing in its economic dealing with other countries. Instead we hear all about global this and European that, as though every other country is governed to protect the interests of international organisations and ideals rather than its own people. It's ok, we needn't worry, the EU or the UN will come to our rescue if something goes wrong. All we need to do it strengthen these bodies and we need never worry about anything again. This strikes me as a peculiar way to go about things and to be fundamentally wrong both in fact and in principle.

It is wrong in fact because many governments are assiduous in protection of what they consider their national interest, the USA and France are perhaps the most obvious examples of this but it goes far wider than that. Do you think the former soviet-bloc countries have joined the EU out of a sense of altruism or to further the political strength of the EU Parliament and Commission? Of course they haven't, they have joined because they see it as potentially beneficial for their people. Beneficial in two ways. First by giving them access to markets across Europe without the handicap or import taxes or restrictions on the right to work, and secondly by giving them access to hand-outs from the EU's pot of gold. If they were to become net contributors they wouldn't give a second's thought to joining the EU. They joined because they considered it in their own national interest to do so.

The reason relying on more and more international bodies to provide protection in times of difficulty is wrong in principle is that standards differ about what is a difficulty and what is the right way out of it. It's easy enough with something like NATO, a military alliance, because dealing with a military threat does not (except in the most esoteric way) involve cultural values and different interpretations of what is a threat and what is beneficial. Once diplomacy fails, either you shoot back or you get massacred; having more people with guns on your side is plainly beneficial. But you can't apply the same universal standard to economic or social matters. What areas of the economy should the government be involved in, what part should government play in sports or the arts, how should health care be funded, how should children be educated? There is simply no single answer on which everyone can agree. What is acceptable to the people of one country can be wholly unacceptable to another because of their differing history and culture.

Once decisions are passed to an international body it can become a supra-national body. Instead of being a meeting point for heads of government to see what common ground they can establish (as is still he case with NATO, for example), the body itself starts to form its own agenda and countries are required to fall into line or suffer sanctions. Instead of EU policy being a summary of those things all the member nations agree on, it is now something the member states are required to comply with whether they agree with it or not. This creates both practical and political problems.

On the practical side we have such things as current EU laws and directives on so-called health and safety. Health and safety is a balancing exercise between risk and reward. You can't just say "you must reduce the risk in this way" if that impacts so much on the reward as to make the whole exercise onerous or pointless. Of course people sometimes fall off ladders or chairs when changing a light bulb but the risk is pretty small, to require the erection of a scaffold tower and for all around them to stop work and stand well clear would be disproportionate to the risk. Did you know you cannot lawfully change a light fitting in your kitchen or bathroom without having the work certified by a properly qualified person? That's all very well for Mr Rich who would hire an electrician to do it anyway, but it's onerous for Mr Poor who saved for weeks to buy a nice light fitting and now has to fork out the same amount again for someone to fit it or check how he has carried out the most simple of jobs. There is no single standard of what is appropriate for everyone in all circumstances. Yet the more powers that are passed from national governments to supra-national bodies the more uniformity will be required and the more cases there will be of central edicts being inappropriate or absurd when put into practice.

The political problem arises from the inevitable democratic deficit of these bodies not being answerable directly to the people their decisions affect. This breeds mistrust because people don't remember the things the body got right only the things they got wrong. An ever-growing list of perceived errors combined with no effective means of changing the membership or policies of the body, can result in widespread discontent. Think back to 1979 and 1997. In each of those years a stale government was ousted and the result was that the very people who felt most let-down by the old were invigorated by the new. Yet how much actually changed about overall government policy on the 4th of May 1979 and the 2nd of May 1997? Twenty percent, ten percent, five percent? Maybe not even five percent. What changed was the general emphasis of policy much more than its details and, most importantly, all the failings of the old governors were sent out of the door and the new lot started with a clean slate. Between 1979 and 1997 the Conservative's slate filled with chalk dust, bits of fluff and dried chewing gum, and between 1997 and today Labour's slate has undergone the same transition. The mere fact that we voted to change our governing party gave continuing legitimacy to the whole system. Without the possibility of such change it is inevitable that legitimacy will disappear, thereby negating the only thing any government can rely on as its ultimate authority.

The aftermaths of the 1979 and 1997 general elections also show that there can be a radical change in certain basic aspects of policy to correct systemic problems encountered with the established way of doing things. Mrs Thatcher's central message in 1979 was that the old way of doing things wasn't working. The country was bankrupt and she argued for business and industry to be allowed to show what it could do without some of the centrally-imposed constraints which had become the norm. Not everyone agreed with her. It was essentially a matter of opinion not fact, but enough agreed with her to allow her to be given a chance to put her ideas into practice. Something else was tried because the former consensus no longer held sway. A similar change occurred after the 1997 election. Mr Blair argued that The State was doing too little and could do more to improve peoples lives. Sufficient agreed with him for his ideas to be put into practice. The system allowed new ideas to be put into practice because the old ones were no longer perceived as appropriate to modern life. Today there seems to be a sizeable body of public opinion that a change is needed again and an opportunity to vote for change will arise within the next fourteen months. We learn what works and what does not work by trying new things and seeing what effect they have. Even if 95% of policy remains essentially the same from one government to the next, the other five percent can make a huge difference - perhaps beneficial, perhaps not, that's a matter of opinion; there is always another election coming along for those who make a case against the incumbents.

How do you change the policies of a supra-national organisation when the existing ones do not suit the people of a particular country? The answer, of course, is that you can't. It is inevitably one-size-fits-all, like-it-or-lump-it; uniformity is seen as a benefit in its own right regardless of its practical effects. We often hear government ministers saying they are merely implementing EU policy when something daft or unpopular is brought in, as though that is an excuse. To my mind it shows the great problem with removing powers from Westminster and giving them to Brussels. Not only is there no way of giving EU government new legitimacy when it has lost our confidence but there is no effective way of changing EU policies that don't work.

Through all of this, we little people are concerned with how things affect our lives. Those who live in a village are concerned about how political decisions will affect their village, townsfolk and city dwellers ask the same about their town or city, they all do the same again when county-wide issues arise and we all do it on matters that affect the whole country. The national interest is not a political fiction, it is a reflection of the real concerns of the little people. When a factory closes in Birmingham there is a problem for those who lose their jobs and for those whose businesses and jobs depend on the Birmingham factory (such as shops close to the factory who relied on trade from the workers as they arrived and left each day). It is also a problem for the UK as a whole because increased domestic unemployment reduces UK tax revenue and increases the claims made on UK taxpayers. It has no effect whatsoever in Paris, Frankfurt or Warsaw, and the governments of France, Germany and Poland are too busy trying to protect their own people to worry about it.

Even though we are trapped within the money-sucking vampire known as the EU, we still have a national interest and there are still a few ways in which it can be promoted. Currently, all over Europe, national interests are being asserted afresh from the bottom-up. More of the same centralised power cannot answer these interests because British, French, German, Polish and all other EU manufacturers and other businesses are not playing for the same team, they are in direct competition. Our countries as economic units are also in direct competition.

I hope we hear a lot more about the UK national interest in the run-up to the next election. It is far too important to be left in the hands of the EU or the UN. We are best at deciding what is right for us. We might not be very good at it, but we still do a far better job than any unaccountable body concerned more with its own power than with improving life for us.

It's gardening time

Here we are, the last week of February, the time that conventionally marked the start of gardening season at FatBigot Towers. Not for the last few years, sadly, concerns about the old damaged ticker not being able to withstand the effort required forced abstinence from digging and weeding; only the compost heaps have been maintained in anything like good order. But after a splendid winter containing sufficient cold to kill off vast numbers of detrimental bugs, I will waddle outside tomorrow, exhume a fork from the shed and set about bringing new life to the flower borders and veggy patch.

A rather virulent argument seems to have broken out at Mr Kitchen's place over the desirability of turning land over for growing vegetable in order to reduce dependence on imported produce. Apparently the National Trust is campaigning for companies to make land available and has gained the support of Monty Don, the former presenter of Gardeners World on the BBC. My own love of gardening owes a lot to Gardeners World and the practical advice and guidance given in years gone by on that programme, back when it was about gardening rather than design and politics. Percy Thrower, Peter Seabrook and, in particular, Geoff Hamilton were absolute masters at showing how simple most gardening tasks are. When Mr Hamilton died and Alan Tichmarsh took over the old ways continued for a time but then there was more about inventive uses for concrete and stainless steel, more bigoted nonsense about not using pesticides, more utter humbug about global warming and less about dibbing and potting-on. All very well for those of us who had learned the techniques, but not a lot of use in teaching new potential gardeners how to actually do stuff. Since Mr Don's enforced retirement from the programme last year on health grounds a new presenter was found, Toby Buckland, who has returned to the Thrower-Seabrook-Hamilton ways, and not before time. Because it's on the BBC he is required to mention climate change at least three times every show, but you can see it's just a script and not something that gets in the way of showing how to separate herbacious perennials, aerate a lawn and make life miserable for slugs.

I can see a point to the National Trust's idea. To the extent that there are people who would like to grow their own fruit and veg but don't have anywhere to do it, making more small plots available for rent will help to meet that frustrated demand. The irritation is that this scheme is being promoted a a way to limit this country's dependence on imported fruit and vegetables. That is utter nonsense. Any thought that it will make a major difference to the amount of food we buy is simply laughable. If you really know what you are doing and have a lot of time to do it you can grow enough veg to feed the family all year in a plot of fifty feet by a hundred. Mind you, you'd have to plan your crops very carefully, have decent harvests of everything and make sure you can store large quantities of produce between harvest time and consumption. It works for some, but only for some. And when we do grow our own the inevitable result is that we don't buy the very things we have grown. So, during British runner bean season we eat runner beans from the garden not from the shops. At that time the runner beans in the shops are British runner beans for the very simple reason that it is British runner bean season and they are cheaper for the shops to buy than those grown overseas. Of course it is possible to store surplus produce for eating during the off-season and that will cut down on purchases of imports, but storage is a far more difficult process than growing and I cannot see how any significant impact is likely to be made. What seems reasonably certain is that any significant increase in grow-your-own will impact most directly on British farmers.

I don't grow my own veg out of a desire to deprive either British or foreign farmers of income. I do so because I enjoy the whole exercise. They also taste much better than anything I can buy in the shops, but that would not be sufficient reason if I did not enjoy growing them. For me it is exciting to see seeds turn into seedlings, and seedlings turn into little plants, and little plants turn into big plants, and big plants provide something tasty. But like all hobbies, it is not for everyone. I can't understand why anyone would want to go fishing, but others enjoy it. I can't understand why anyone would want to swim, but others enjoy it. If it comes to that I can't understand why anyone would want to eat cauliflower or tofu, or drink carrot juice or Dr Pepper, or listen to (c)rap music, or watch 95% of the twaddle available on our hundreds of television channels, or read Mills & Boon romance novels. We all have different interests and different tastes. It is sheer blind folly to think that encouraging people to grow their own veg is going to get people doing something they don't enjoy, just as it is sheer blind folly to think Jamie Oliver's skills will ever persuade fat chavs in leggings to turn from pizza and chips to home made coq-au-vin with steamed broccoli florettes and dauphinoise potatoes.

I don't have any desire to stop the National Trust encouraging people to give gardening a try. But I do wish it would stop making false claims about the potential benefits. If they were really concerned about levels of imports of fruit and veg they should be campaigning against the EU's truly evil Common Agricultural Policy. It is absurd to burble-on about people growing their own when our farmers have thousands of acres of prime fertile soil left unused each year because the EU requires it.

Potatoes, onions, carrots, runner beans and a winter cabbage this year, I think. Yes, they always grow well here and the neighbours love getting the surplus.