Another dismal ten days in British politics. Where is the British Spring?

It was never going to be a good spell in UK politics but with overlay of continuing dismal winter weather it ended feeling particularly gloomy . None of Britain's diminished political leaders can be proud despite some smirks flitting across faces. Miliband's anyway. Cameron has forgotten what they feel like and Clegg remains too ashen to lighten further.

The gloom started ten days ago when fearless David Cameron walked out of talks between the three party leaders' ( a term which we always use loosely) talks on Leveson inspired press controls saying that no way would he support the proposed (already repressive) measures being backed by statute. From that moment on everyone knew he would give way. He almost always does. He must have been inspired in his childhood by the grand old Duke of York.

What followed over the weekend was the most astonishing scene of Cameron withdrawing from centre stage and allowing the final compromise negotiations to be conducted by Ed Miliband, in his impressive House of Commons office, with the pasty faced new best friend for the day Nick Clegg at his side and beyond him, almost off the table , the Tory lightweight Oliver Letwin who had been given the task of attending by the sleeping or sleepwalking Prime Minister. It was a masterpiece of positioning by Miliband, naivity by Clegg and a disaster for Cameron.

Taking Cameron first. Having made his line in the sand statement on Thursday night in the full knowledge that it would probably lead to defeat in the Commons on Monday, he should have stuck to his position. It would have enabled him now and in the future to say that it was he and the Conservative Party  who resolutely opposed statutory press regulation while the two parties of the left, (Old) Labour and the LibDems promoted it. It would  have cost a defeat right now but built a platform for the future. As it is all that he can say now that he didn't actively support it,-whatever it eventually turns out to -but when the crunch came he stood aside, let it happen  and actually signed up to the deal brokered between the parties of the left and the self interested ( are we allowed to say that now?) pressure group Hackedoff. The mark of a man of conviction and determination? No.

Allowing Miliband to chair/lead the meeting was crass and showed almost unbelievable political naivity and lack of understanding. It was the hallk of a man relatively new to the Commons (one and a half terms so far) and not hardened in the battles and cut and thrust of the place. It allowed Miliband to look almost Prime Ministerial and certainly in control of the process while he, Cameron, if awake, looked on from the sidelines.Where were his advisors or even the office boy? What has happened to the Conservative machine?

We will skip quickly over Nick and the LibDems. Their role, again orchestrated by Miliband, was to appear as fickle chancers in coalition with one lot one day and daytripping with another the next. How the LibDems can claim to be liberal when they repeatedly back centralist and illiberal policies has always been a source of amazement but that's what they do and seem to find no contradiction in it.

Miliband is extremely well advised on tactics and his party machine is way better than Cameron's so that was another good weekend for him. He has no problem with illiberal moves on the press. Labour have never much liked  them anyway and have always wanted to see the jackals better "controlled" and unable to speak too freely, particularly if they revealed embarrassing shortcomings or inconsistencies in party people or policies.

So much for the individuals. Now for all the politicians there that night and in the shadows behind them collectively.

As a group, politicians like spoiled celebrities, love to bask in adulatory media coverage but find some investigative journalism embarrassing . They have never liked some of their social or professional activities receiving critical or questioning public airings. All that embarrrasing stuff about expenses, carryings on in the ( £5 million+ subsidised) Palace of Westminster places of refreshment or even the occasional office table. Really not stuff the electorate should know.

On this occasion the left slipstreamed behind public concerns about press misbehaviour including possible phone hacking and unjustly publishing unfounded conjecture about some of the people involved in murder and other cases. There are laws to deal with this anyway as Cameron should have realised before laying down and then stepping on the Leveson bananskin  The Labour and LibDem behaviour was totally cynical opportunism at its worst . The final act of thrashing out a deal between a Miliband, Clegg and , part time, Letwin on one side of the table and a bunch of luvvies representing one pressure group on the other was extraordinary. All the political parties should be ashamed of themselves,-but are not.

With all that out of the way for the moment, up stepped George Osborne with his latest budget. These are never merry occasions and last year , when he managed to allow several sensible and well intentioned moves be portrayed as horrifically unreasonable, was a particular disaster. This year, at least presentationally, wasn't as bad. The messages were downbeat and gloomy but not described as starkly as they should be to jolt public awareness that there simply isn't any money in the tin and that the ongoing rises in the total national debt make Labour's solutions of just borrow, borrow, borrow even less credible than they would be anyway. The real problem though is that ,other than good housekeeping, there is no overall political philosophy or vision behind it. Nor is there real understanding of what it takes to wield a real axe at Whitehall and its local satellites.  The Tory leadership, especially in the form of Cameron and Osborne are totally without those insights. They are OK with the figures but see them in a two rather than three dimensional fashion . As result they are left unable to navigate an inspirational or even reasonably explained course out of the current backwater where Messrs Brown , Balls and Miliband Minor left the nation in 2010.

As yet the Conservatives have not come up with a proposition as to why they should win in May 2015 other than that Miliband, Balls and the unions would be infinitely worse. A good point, but probably not good enough over enough of the country to avoid swapping sides of the Commons aisle after just five years.

That was it then, but the week did have a couple of run-ons. There is the financial crisis in Cyprus where the EU hammered the Cypriots into an admittedly deserved corner primarily to save the Euro rather than the diminutive country. Meanwhile at home, Cameron resolutely declared a war on new immigrants receiving immediate benefits , priority on housing and the like once they manage to touch the UK Border signs with as much as a finger. That means nothing much is likely to happen, at least this side of the 2015 election and Labour and the EU will probably veto it anyway. Business as usual then, statements all over the place, nothing happening, no balls other than Balls. It's not been a good ten days,- and the winter has continued too.

Easter eggs around the corner? Don't bet on it.

Humphrey Hudson on the Cyprus crisis.

Eurozone Credibility Badly Damaged by Cyprus

Whatever the outcome of the Cyprus crisis, whether it is some sort of last minute, probably dubious deal or even Nicosia’s exit from the eurozone, the whole sorry saga of the past week underlines that the eurozone may no longer fit the financial and political purpose for which it was established. The original 10 billion euro bailout deal for a country whose banking assets were valued at eight times GDP was cobbled together after months of argument and dithering. Overall the country needs some 17 billion euros and the eurozone help requires Cyprus to provide 5.8 billion euros from its own resources.

No doubt Cyprus and its banks ran a pretty strange regime – and a quite profitable one – but then they began to get their comeuppance when the Greek crisis saw bondholders take a massive haircut. But even then the eurozone, together with the IMF and the ECB  did little to really tackle the growing and quite obvious Cypriot crisis until it was far too late.

Did Eurozone Delay Aid Decision Till After Cyprus EU Presidency ?

A cynical observer might also suspect that the delay in taking action was influenced by Cyprus holding the rotating presidency of the EU for the last six months of 2012. The crisis is already a major disaster for the eurozone, but if Nicosia had been bailed out in such badly managed way or exited the euro, while actually occupying the presidency, the humiliation of the eurozone – and the EU – would have been plain for all to see. But after a week’s infighting between the EU and Cyprus, with Russia understandably stirring in the background, the humiliation is now complete. Why should countries outside the eurozone take the currency block seriously when they cannot manage to resolve the problems of one of its smallest members?

Cyprus may only account for 0.2 pct of the eurozone’s GDP but it looks as if it might well be the detonator for – at best – a major realignment of the eurozone into the northern euro group (aka the Merkel Mark) with the Club Med group, probably led by France forming the southern euro group. But things may turnout to be even worse, as the present situation could see Cyprus exit the euro, giving the country the chance to be both the first country to reject demands, advice and suggestion from the troika ( as I have said in the past, aka the Inquisition) and also the first to ditch the common currency.

As the French media, amongst others, are saying Cyprus ( at least the part governed by Nicosia) should never have been allowed to join the EU, let alone the eurozone. Perhaps they are right, but that’s a long and different story.

Underlining the whole sorry developments over the past months and especially the past week is also the arrogance of the troika and its members. Cyprus may have been even more at fault than Ireland, Greece and Spain, but the troika has decided that it knows best and has hardly accepted any changes or ideas.

 

Eurozone and EU Threatened by Outcome, Where Was Democracy ?

But what is worse and may end up not only breaking up the eurozone, but even the EU project as it stands,  appears to have the total lack of interest in any democratic approach. Both political parties and voters have largely been ignored and deals have been hatched in bars and backrooms during late night sessions amongst EU political leaders and bureaucrats. It is as if they are scared of asking voters because they fear the outcome will be to reject such outcomes and proposals – if things do fall apart and the EU /eurozone has to be restructured, Brussels and unresponsive eurozone leaders will have no one to blame but themselves and quite rightly so. The banking union will fall by the wayside. And who given the cock-up over Cyprus, the latest of many, can be surprised if extremist and anti-EU parties of the left and right gain ground.

No doubt there will be cheerleaders – especially in the European Parliament – saying the crisis clearly shows that the answer is more, and yet more Europe. Unfortunately the real world suggests just the opposite is needed. It also raises the question as to whether the European Parliament itself is really relevant except as home for largely redundant or second-rate politicians, more interested in a comfortable well-paid existence at the expense of the European tax payer.

And again the parliament has a strange idea of democracy and free speech which seems largely to be continually focussed on promoting so-called “European unity”, while treating anyone who has perhaps different -- or just -- pragmatic views as being unacceptable, if not downright extremist. In other words, free speech is equivalent to being promoting “more Europe.”

The Latest Situation – At Least Till It Changes

Bank of Cyprus governor and ECB board member, Panicos Demetraides ( a name to remember?) says Friday is the day to decide the country’s fate and whether or not it remains in the eurozone. In principle trhis means that sometime today there should be a parliamentary vote on the latest package.

Total bank deposits with Cypriot banks are estimated 68.4 billion euros, with some 21 billion euros from non-eurozone residents. Figures for direct Russian deposits range from 5 to 20 billion euros but if indirect funds are included the total would be well over the 20 billion level.

1. Cypriot Finance Minister Michalis Sarris left Moscow with empty hands after saying he would stay till next Tuesday to reach a deal. There was no agreement to extend for 5 years an existing Russian 2.5 billion euro loan maturing in 2016, or to cut the loan’s 4.5 pct interest. Moscow was also unwilling to inject funds into a new Cypriot public sector group in return for a stake in the substantial natural gas deposits discovered off the island or to provide a further 5 billion euro loan to Nicosia. Later Russian Prime minister Dimitri Medvedev suggested the door was not completely closed but needed to await decisions by the EU.

2. The Cypriot government is due seek parliamentary approval for capital controls when banks reopen, possibly Tuesday (NB - Monday is a public holiday). (HH – Are any eurozone countries, eg Greece, now also considering capital controls to prevent contagion). The government controls 20 seats in the 56 seat parliament.

3. The government plans to restructure two largest banks, the Bank of Cyprus and Cyprus Popular Bank (Laiki), including the creation of a “bad bank” for assets over 100,000 euros. But this could see such assets eventually sold off a discount if the banking bill covering the restructuring is passed, it might reduce Cyprus based funding requirements to 3.5 billion euros (versus expected 5.8 billion euros). However a later development might see the survival of the Bank of Cyprus and just the closure of Laiki.

4. Bank deposits under 100,000 euros may be protected but any over that amount could be taxed by as much as 40 pct. The government is apparently also seeking to restrict non-cash transactions, limit the use of cheques and the size of withdrawals, and possibly convert current accounts into fixed term deposits.

5. The Eurogroup agreed late Thursday that Nicosia should guarantee deposits under 100,00 euros and will help Cyprus if any proposed reforms are backed by the troika (aka Inquisition – but how long would that take). But on Friday, the troika rejected the idea of a some sort of new solidarity fund (grouping all the assets Nicosia can readily lay its hands on), as being “too vague. If no new deal can be reached by Monday, the ECB will withdraw financing for Cypriot banks and these are likely to fail when they reopen on Tuesday.

6.  German Finance Minister, Wolfgang Schauble says the eurozone will not provide more money and that Cypriot bank creditors must take some of the burden.

7.  German Chancellor Angela says Cyprus has not contacted the troika for days (!) and stresses that any domestic plan to finance the bailout shortfall must not tap Cypriot pension funds

8.  Nearly two thirds of Germans expect the euro zone crisis to worsen and almost half fear for their savings, according to an opinion poll released on Friday, amid rising concerns that Cyprus may be forced to quit the common currency.

9. Standard & Poors has downgraded Cyprus to CCC from CCC-plus, pushing further into junk status. “"We believe that in the absence of a credible alternative source of capital and fiscal financing, the risk of a disorderly credit event is rising," S&P said in its statement.

10. Spanish economy minister, Luis de Guindos said a new proposal for tackling the crisis is expected within a few hours and “all Euro nations” want to keep Cyprus in the common currency area. Well’s there a big surprise.

11. Apparently Piraeus Bank based in Athens is willing to take over the Greek branches of the Bank of Cyprus and Laiki  Bank which could exempt from any Cyprus bailout deal.

 

Some Facts, Figures and Fiction ?

The EU Commission -- even before the latest developments --suggested Nicosia’s GDP fell 2.3 pct in 2012, and forecast a 3.5 pct further decline this year and a 1.3 pct drop in 2014.

Much of the Russian money deposited in Cypriot banks is considered by the troika to represent money-laundered funds, which is strongly disputed by Moscow. A leading Cypriot lawyer, Chris Vassiliades of Vassiliades & Co made an interesting comment, “ Russians have the same size assets in France and the EU is not worried about that.....(my) Russian clients are thinking of moving their assets to France.”

Was Finnish EU Commissioner for Economic and Monetary Affairs, Olli Rehn, the man who last week pushed Cyprus into imposing a special tax on all bank deposits including those of the smallest depositors ?

Only a few months ago, the leaders of France, Italy and Spain all said that the euro crisis was over and that setting up the banking union was now the most urgent step forward. But the northern euro group led by Germany was much more cautious, stressing that much remained to be done before the crisis was resolved and the banking union should not be rushed. Events appear to have backed Berlin.

Why should creditors and depositors in EU and eurozone countries any  longer trust their political and financial leaders when they appear quite willing to simply ignore treaty obligations to protect depositors with assets of up to 100,000 euros in EU banks ?  Who would be surprised if the events of the past week does not encourage a run on eurozone banks at the slightest sign of doubts elsewhere, especially in the Club Med group.

Spain is apparently now considering a tax on bank deposits, which the authorities claim has not been inspired by events in Cyprus. There would be a slight difference in that the tax would be levied on the banks rather than directly on depositor accounts but financial experts point out the levy, even if likely to be much less than in Cyprus, will still eventually be passed on to customers.

Strategic Issues  - Middle East, Russia

Cyprus is situated in key strategic position in the Eastern Mediterranen with two British sovereign (military) bases plus important monitoring and communication facilities on top of the Troodos mountains.  Although it is not a NATO member, would the latter or the West be willing to loose access to those facilities at the very moment when Syria is in the midst of a bloody civil war, the Arab Spring is still struggling, the Balkans are restless and the Israel-Palestine issue is still unresolved. I doubt it.

As a JP Morgan assessment puts it,” if Cyprus ultimately defaults and needs to leave the euro area, its dependency on Russia is likely to increase dramatically.”

-Humphrey Hudson-

Back from the wilds.....

Twiga has now returned from winter and assosciated other miseries avoidance measures and is again able to stretch the neck and survey the world high in the expectation that it will have moved on, got a grip on things, solved some problems and be looking forward to a golden spring and summer. What then do we see? Have out political minnows grown larger, more attractive, more dynamic or even more human? Has Nick smiled, Ed stopped the sanctimonious whinging or Dave got his act toegther to do a few things now rather than in 2016/20/30? Surely some things must have cheered up and got better?

Sadly , despite the neck rotating 360 degrees there are few hopeful signs. We will continue to look though.

Meanwhile what's on the radar screens at home and around the globe?

First up in the UK is today's nonsense in the House of Commons where the forces of illiberalism, Labour and the LibDems , have hijacked the aftermath of the ill-advised Leveson enquiry to try to achieve potentially  the most restrictive press regime in the western world. By positioning themselves as champions of press "victims" ("We are all victims " is part of the staple diet of the left) they have been pushing for draconian measures which, especially if misused in the future, could restrict essential press freedoms. Cameron has been making "We shall fight them on the beaches "sorts of noises but everyone knows that these really mean "We shall talk to them on the beaches" and that doesn't have quite the same impact in negotiations. Indeed it indicates a willingness to actually surrender and hand over salvaging any credibilty to the spin people to achieve.  What we look like getting is therefore more of less what Ed and Nick wanted with a dollop of "No it doesn't really mean that" from Dave.

If we think we have problems with politicians in the UK, spare a thought for the Italians after their recent election. Mr. Monti, the man who was trying to get their finances back on track,- and wasn't doing a bad job,- got the boot with just 10%, while the comedian Bepe Grille came 3rd with 25% , beaten by the other comedian , Berlusconi , who has brought Italy , and not only the country, to its knees who was rewarded with 30%. The winner Pier Luigi Bersani has to cobble together some sort of coalition to overcome his problem of having a minority in the lower house. The overall winner is economic uncertainty and Italy continues to look like a dodgy Euro runner . That isn't exactly a magnet to investment.

In Syria the impossible and life consuming impasse continues. Britain and one or two others want to arm the rebels but where do all the arms go once the present conflict is resolved? Iran and Russia act true to form and back Assad ,as they do most people who repress their people, and the EU goes round in circles feeling it should do something but having no cohesive idea about what.  The only thing any of the parties , other than maybe Iran and Russia, have is a desire that they wake up tomorrow and find the problem has gone way. It won't have. Who wins or should win is an ongoing argument but the real immediate issue is how to protect the millions of citizens caught unwillingly in the crossfire.

Further east, the truly weird , dangerous inexperienced leadership of North Korea has been rattling its nukes at the world and threatening all manner of discomfort to any enemy troops it might come across. Even its closest friend and erstwhile mentor, China, does not seem to be able to control its more excessive pronouncements. South Korea in particular looks at the scene with some nervousness. The betting is that the north will not actually do anything other than posture aggressively but even that doesn't make for very comfortable nights. Nor does the feeling that the war weary US President Obama wants to hoist the temperature by making reciprocal statements.

South Africa is a bit frisky too. It navigates the racial issue in particular with great skill but there are many in the ANC and elsewhere who wish it didn't. Afrikaaner farmers and their families in particular continue to be killed in payment for old or new grievances about land ownership and the way they have treated black workers in the past. The numbers hit 1,000 some time ago and are said to be over 1,500 now. The country desparately needs new inward investment from overseas but underlying concern about tensions and militant unions driving up wage costs makes the country less attractive than many Asian alternatives although many of their wage rates and general conditions are improving /increasing in cost.

To cap all the gloom there has been this weekend's European Central Bank insistance that the Cyprus government does a smash and grab raid on savers, nationals and foreigners alike,- or at least those who stash their money in banks rather than under or in their mattresses. There is a high risk that savers in other weak parts of the Eurozone such as Spain, Portugal and Italy take fright and withdraw their funds from their banks just to be sure.That would put new pressures on these institutions which, without even greater government support, aka bailout, could go under and thereby bring the whole credibility of the European/Eurozone banking system crashing down.
This one doesn't look to have been a sensible move. Amongst other things, it breaks all previous EU banking guarantees so are any worth the paper they are written on? It could prove to be a disaster. At best it is extremely high risk.

Happy new week,- it's good to be back!

Italian election nighmare reopens Euro wounds,- An assessment by Humphrey Hudson.

The Eurozone's worst nightmares may be about to become a reality. With the whole area facing a very tough 2013 and probably a not much better 2014, voters are becoming increasingly angry at their governments. Greece may be temporarily under control. Spain is still struggling with the situation made worse by high level corruption charges. France has just had to scrap virtually all of Hollande's economic promises under pressure from the real world and now the Italian election seems to have produced a situation in which any chance of forming a government, let alone a stable one, will be very difficult.

Measures to reform domestic markets, labour structures and to boost competitiveness in an attempt to restore the economic situation through internal devaluation,- especially in the Club Med group of Italy,Spain Portugal, Greece and Cyprus which Hollande foolishly decided to lead last yea,- are simply not working. Added to that is the Euro's consistently high value against the dollar and sterling over the past few months, hitting exports. In addition the EU now expects overall Eurozone growth to fall by 0.3% against a 0.1% decline last November. Germany, where Mrs Merkel faces a general election in early autumn is still faring better but there are considerable doubts whether France will maintain its course as anger against even further austerity deepens.

Last week the Bundesbank warned Paris that any backsliding on the new budget targgets set two weeks ago by the EU Commission will threaten confidence in the Eurozone's fiscal discipline. Germany is well aware that the French government has been pushing for softer targets in an increasingly vocal manner since last September and remembers that in the middle of the last decade both countries ignored EU defecit rules to their own benefit. Germany is unlikely to do that this time around but they are worried that France may still push for more breathing space.  French commentators are also now concerned that there is a new axis between the Germany... and the UK leading those northern EU and Eurozone countriies to be much tougher on expenditure.

-Humphrey Hudson.

UK,- Eastleigh by-Election conclusions.

Indeed a fascinating result and the cause of much proud strutting by some and yah-boo'ing by others today.

Away from all that what are the realities?

-The parties of the right ,- Conservatives and UKIP outpolled those of the left, LibDems and Labour.

-The UKIP vote cost the Conservatives a victory.

-If Nigel Farage had stood for UKIP he might have won the seat, thereby denying the LibDems some of their crowing and making a much bigger impact for his party,

-It was a bad result for the Conservatives and it will fuel questions about David Cameron and the style and substance of his leadership as well as about lack of overall vision, strategy and tactics.

-The Conservative party now has a direct challenge from the right, one which will take its rather than anyone else's votes. That changes the electoral mathematics of the entire right side of the political spectrum. The Tories were formerly guaranteed the votes of almost all on the right as they simply had nowhere else to go. This fact enabled the leadership to go marauding into centre left territory in search of additional voters with no risk of losing any on the right. That's all over now which means that the Conservative leadership will now have to take the party towards the right (including a tougher line on the way Europe/the EU conducts itself) to secure its right flank.If it doesn't......

-The result was nearly as bad for Labour whose share of the vote barely in double figures could fairly be described as derisory. It therefore poses the same questions for and about Ed Miliband. He and his party, which until the mid 1990s held Eastleigh have nothing at all to crow about. Above all it begs the question as to whether Labour is a saleable product in most of southern England.

-To both the main parties, Conservatives and Labour , the electorate said neither of the above".

-Does this mean that neither is electable under its current leader and /or policies?

-If  UKIP made the same inroads into the Conservative vote nationwide in 2015 a clear Labour victory would be assured and the LibDems would be out of government. It would be ironic if their visible efforts to be poor coalition partners to the Conservatives by undermining numerous initiatives including the much needed boundary changes and reductions in the number of constituencies were to see them again in the world of political impotence and irrelevance. The lesson for them is and would be that unprincipled opportunistic disloyalty ultimately gets you nowhere, other than in former times maybe the execution block.

Both main parties now have some serious thinking to do about what the electors are saying and what they want. Not enough people are buying the products they are trying to sell. Political parties, although they haven't yet understood it,  have now become businesses not religions and have to understand that outside a dictatorship or one party state, if they don't provide what people want then someone else will. In this case the new providers turn out to be the LibDems and UKIP. The Conservative and Labour parties will have to become market orientated  rather then ploughing on trying for ever to force old fashioned dogma driven policies down the electors throats. Both have been given a timely opportunity to rethink what they are all about and how they do business and realise that they are not religions.

The question therefore is whether the Conservative and Labour parties can grasp the moment and reinvent themselves as voter-friendly marketable businesses offering and delivering what people want ( and that includes the tough bits) or whether they are unable to do that and want to stay firmly rooted in old dogmas and "we know you've little choice"  approaches. It is these above all that the Eastleigh voters rejected yesterday. Like it or not, the customers are right and the big parties are in the brown stuff.

European Court of Justice's ruling on disruption liability flies in the face of reason.

The European Court of Justice's verdict that RyanAir must compensate all passengers booked on its cancelled flights during the Icelandic volcano episode appears to fly in the face of all reason and common sense. How did they reach their verdict?

Under normal principles of English and Scottish (yes, they are different) jurisprudence, there are things which are nobody's fault and therefore come under the undeserved heading of " Act of God". They do occur. No earthly person could have intervened to make them happen or to prevent them. Volcanos would reasonably fall into that catageory.  Nobody therefore is liable for the consequences. Under this heading therefore Mr O'Leary and others should have been able to sleep soundly.

The airlines were not resposible for the volcanic activity . The next question is whether that having happened, they did or did not do anything to make its effects worse.Clearly not.Far from voluntarily stopping flying through areas which might be affected by airborne ash ,they were specifically prohibited from doing so by the UK and European aeronautical authorities. If there was any error of judgement which made the grounding unnecessary or too restrictive, then that should logically be the responsibility of those who made the decision, not the airlines,who complied with it at least until it  clear that much of the ban was unnecessary and threatened to fly anyway unless the authorities reconsidered their position,- which they then did.  If anyone was responsible for the lengthy period of flight cancellations it was the therefore the authorities,not the airlines.

It should therefore have been game, set and match to Mr O ' Leary. But it wasn't . The claimants then took their case to the European Court of Justice, the sump for all cases and claims which have failed in the national courts of any EU member state. As each of the nations has its own legal system developed over centuries and many are very different from each other there is no overall European law other than such has been created by the EU beaurocracy itself.  Much of this is about human rights which means that any case before ECJ will primarily be held up against the light for conflicts between the original state verdicts and the demands of these .The verdicts of individual state laws are therefore tested against others created above and outside. Anyone who talks about the supremacy of the laws and parliaments of the sovereign member states of the EU has not understood the reality.

Here is where the divergence and opportunity for the supremacy of a different concept occurs. EU laws, such as they are, lean heavily towards the concept that somebody must be responsible for almost anything and that as result somebody else must be eligible for compensation if things go wrong for them. Accidents don't happen.

That meant that someone other than the deity had to be responsible for the passengers being "stranded" ( As we noted at the time, many British residents actually weren't. They appear to have been unaware that they were somewhere in Europe through which ran roads and railways to English Channel ports whence ferries shuttled to their home island). The aviation authorities of Europe, being organs of governments of member states , were not expected to own or pay up so who else other than the airlines could carry the can?

That then appears to be how the decision was reached and to that's how the logic , even though fundamentally flawed, went. People have been inconvenienced. Someone, other than the state or states, has to be held responsible and pay. No wonder Mr O'Leary was shaking his head at being landed with the bill while the organsation(s) which told the airlines not to fly were absolved of blame or responsibity for the results of their acts or omissions.

Footnote: A UK government official on TV news shrugged off the liability of airlines for delays regardless of circumstances , describing the cost to the airlines  (already over £20 million to RyanAir alone even before the court case) in this particular instance as being "small beer" in the overall context of their revenue/profits. He clearly had no idea how narrow the margins, if any in many cases, of the industry are and how the ruling could put some carriers, small and large,"customers"of his department, out of business.

The EU debate,- remember Cleggmania?

Remember Cleggmania? Those heady days when with an eye on possible post 2010 General Election Glowering Gordon said several times " I agree with Nick" and there was an outburst of political knicker waving in adulation of the young Clegg throughout the land? It really does seem a long, long time ago now.

Unexcited by his senior coalition partner's speech on a less top down, all controlling future for the EU and  not having heard or understood Cameron's dogwhistle to other members disturbed by a seemingly unstoppable march to undemocratic almost totalitarian political union, the habitually ashen faced boy Clegg today denied his colleague anything like a "I agree with Dave" statement. Instead in his new weekly phone-in session he firstly claimed that the UK was tying itself in knots, exactly the opposite to what Cameron was actually doing in his speech which was about clarity rather than the present confusion over where the EU really aims to go. The lad then went on to say "It is wholly implausible to think rules could be written to benefit us and to disadvantage everyone else". Again this is precisely what Cameron was not saying. He was taking a firm and decisive urging that the rules be rewritten to advantage everybody, thereby bringing the issue of the EU's self imposed burden of ever increasing, expensive and restrictive over regulation and centralised control of even the minutiae of life into the open. Nothing could have been clearer.There was no suggestion of disadvantaging everyone.

Charitably we therefore have to conclude that Mr Clegg, exhausted by the weight of his governmental responsibilities, must have nodded off at crucial moments during the 40 minute speech. Fair enough, these things happen. If not, and he was awake and listening carefully throughout, he has much more disturbingly shown a failure to grasp what was actually being said. Surely not for a man of his intellect and public school background ? Alternatively it could just be that to a good LibDem someone must always be being disadvantaged by almost anything done or proposed by anyone so his mind simply went into auto-disadvantage and out came the statement,- just like that. Couldn't help himself.

In shying away from reforms of the vast EU burocracy, of which he was once an enthusiastic part, and of what it does and how it does it and  by opposing a referendum Clegg is in effect saying "We must go with the flow and take what comes even if it is an almost total loss of sovereignty and real democracy." Even worse, he is saying to the electors "You of course are too thick to understand all that is involved so you must leave it to the politicians and officials to decide". In the words of a switch selling expert in a fast talking Hong Kong shop "You like this one" which means of course "This is the one you are going to get".

In another corner of the strange,contrary and even intellectually arrogant and intolerant world of the LibDems, they are supporting a Labour private members' proposal for the lowering of the voting age to 16. "Much more democratic " they say. That is code for "Young people tend to be much more hazily idealistic and therefore likely to vote for us", a belief long shared by the Labour Party which is why they advance it. It honours a LibDem election promise. Those promises look as far away as "I agree with Nick" . Another undertaking at the start of the coalition was to support Conservative moves to action the most recent review of constituency sizes and number by equalising  the numbers of voters in each . Very democratic but since reneged on by the Clegg in pique at the further reform of the House of Lords having been set aside.

One thing new 16 year old voters need to know up front as an intellectual reality check and health warning is that the neither of the words Liberal nor Democrat on the tin necesarily represent what is inside. Now what about some new labelling laws and an overhaul of the Trades Description Act as a new cause Nick? Are you with us?