Tag Archive: Germany

Brexit and Nationality: a case study

Yesterday, I was a Briton who was married to a German and living in the Hamburg area.

Yesterday, I felt AngloDeutsch: part British, part German (plus a few other bits thrown into the mix).

Today, I am truly AngloDeutsch.

I have been eligible for dual citizenship for many years. Initially, by virtue of having a German partner and latterly in my own right, for having lived in the country and paid taxes there for much longer than the qualifying period for citizenship.

Just like my partner, who had the right to British citizenship but never took it up, I never feel the need to become German.

Why would I; I have never felt like a second citizen here. Why would anyone choose to take-up a new nationality or give up one when there was absolutely no need for it under the European Union’s (EU) rules on freedom on people, goods, services and capital? I had exactly the same work, health, pension, tax etc. rights as any other German.

That is how many others in my position felt too, but the UK´s referendum in favour of Brexit changed everything.

My partner regrets not applying for British citizenship when the chance was there. I chose not to make the same mistake. As long as the UK remains part of the EU (currently until the end of March 2019), I was eligible to dual citizenship, so I decided to apply for it.

The decision to for dual citizenship was simple but not easy.

It was simple because I had a choice: either to allow all my rights as an EU citizen to be reduced to two countries, UK and Germany, by retaining my British citizen; or to retain all my rights as an EU citizen by becoming German while also remaining British. What to choose: keep the benefit of all 28 countries or see it reduced to 2 countries?

The choice was simple and in my shoes, you would probably have chosen the same. Like the British government policy stance, I went for the “have cake and eat it” strategy. The difference is that this is was a real option for me, whereas the British government continues to be deluded in thinking that it is be feasible to leave the EU and yet retain all the benefits of being a member of the EU, minus the “inconvenient” bits, such the EU membership fee and EU immigration (not to mention all the other things that the UK has opted out of in the past, such as Schengen, Euro, etc.). Today´s leaks once again show the British government´s inept stance on EU immigration.

The German application process was relatively simple. I had to fill in a 6-page residency form, which was detailed but not a monstrosity of 85 pages and 18 pages of guidance notes, as in the equivalent UK one. There was no unreasonable stuff, such as requiring a list all the international trips I made, as in the UK, or a sense of unreasonable potential obstacles being placed before me, such as proof of comprehensive sickness insurance for self-sufficient persons and students, as in the UK.

It was still a demanding form to complete and required various proofs, such as birth certificates and recent tax returns. Furthermore, it took a good six months to process which is a reflection of the demand for German citizenship, including a spike of Britons applying. The last estimate I read for the UK equivalent was several decades to process the current applications. The German procedure also included a thorough language test (whole day event), as well as a citizenship test (33 questions about national and regional history, culture, society, constitution, etc.), both of which are reasonable if you expect new citizens to integrate. Language is the basis for everything and a bit of knowledge of the country and its laws does no harm.

Those were the “easy”, procedural bits. The harder ones were about the implications for self-identity, as a result of choosing another nationality.

Naturally, this process would have been very different, if I had had to choose between British and Germany citizenship. To have given-up my British identity would have been a chastening exercise. There would have been a lot of emotional aspects connected with considering such a step, though I know Brits who have done so without apparent regrets. I have every reason to be happy and proud to be British, so I am not sure if I would have taken such a step.

I make no bones about the fact that I completely disagree with the way Britain has been changing prior to the EU referendum and rapidly post the Brexit decision. I fear for Britain, its economy and thus the future of my fellow Britons, my parents, brother and friends, both those that voted Leave and those that did not. I have friends and family on both sides of this yawning chasm which already defines Britain today and will continue to do so for at least a generation.

Brexit in itself would probably not have caused me to give up my British nationality. But I am fortunate; it was not a case of either one or the other since Germany allows dual citizenship for members of the EU.

I am fortunate to in this respect. German citizenship is an additive option, not a subtractive one. More is sometime more.

Some of the 1.2 million Britons living in other EU countries are not as lucky, even if they stay in those countries long enough to gain citizenship. Not many countries allow dual citizenship so the decision would be a lot tougher for them.

The Britons already living in an EU country that do not have the option of dual citizenship and choose not to give up their British citizenship will have their opportunities reduced to living and working in 2 countries instead of 28: the one they are living in and the UK. Less is most certainly significantly less in this case.

Everyone else, who is British and residing in Britain or a non-EU country, will have their options reduced from 28 to 1. Less is dramatically less for these Brits. The 52% of the voting electorate that voted Leave will get their just deserts. I feel deeply for all the others that voted Remain or did not or could not vote (myself included, due to the arbitrary 15-year rule).

Less is also a little bit less for EU citizens: their options will be reduced from 28 to 27 (except for the 3.5 million EU citizens living in the UK), though a lot is still to play for during the Brexit negotiations.

This massive asymmetry, involving Britons losing a hell of a lot more options than the EU citizens, has been largely kept from citizens by the politicians, both Labour and Conservative.

Almost criminally misleading claim have been made, such as that GBP 350 million per week will be spent on the NHS instead of the EU, that Britain can have its cake and eat it at the same time by leaving the EU and retaining all the benefits without EU migration and paying into the EU budget in the future, that there will be no “divorce bill”, that new trade deals will be easy for the UK to sign, that the EU has a lot more to lose than the UK from a lack of trade deal, that “Global Britain” can go it alone (surely an oxymoron) once unshackled from a sclerotic EU, that all the current social, health, safety, labour market, etc. rights will be retained by the British government post-Brexit, that net migration can be kept to under 100,000, that… well, you get the general idea. People can be and often are gullible, but not for ever and certainly not when reality starts to bite, which it is certainly doing, despite all the overtime being put into pouring oil on the stormy waters of Brexit by the Europhobic wing of the UK press.

After one year of the British government saying little more than “Brexit Means Brexit” and a lack of clear strategy for Brexit ( “constructive ambiguity” is the best that Mr David Davies can come up with as a fig leaf for the chaos and contradiction that he tries to pass-off as the “flexible and imaginative” British negotiating strategy). Britain clearly lacks the individuals (politicians and civil servants) and institutions with the skills and capacities to deliver a “frictionless Brexit”. Even if this were feasible, which everyone else but the UK government doubts, all the evidence so far is that negotiations with the EU are not going well for the UK and thus also for the EU. But the potential negative consequences for the UK are disproportionate compared with the likely effects on the EU-27.

The messy current and future reality of Brexit has become all too clear to British businesses and is rapidly becoming apparent to British citizens too. The politicians “in charge” (the hapless PM and her merry band of Brexiteers, Nigel Farage included) cannot postpone the inevitable.

The British economy has done extremely well in recent decades and this has been, to a significant extent, due to three critical champions that generate disproportionate wealth, employment, innovation and tax revenue such as the financial sector, the automotive industry and the university/research and development sector among others.  All three are currently in serious trouble. The first 12 months post-Brexit were a period of relative calm but since Article 50 was triggered by the UK, the implications rapidly began to dawn on the business managers in all three sectors, as well as most other parts of the economy.

There is trouble ahead, there are extra costs ahead, there are extra risks ahead, there is extra bureaucracy ahead, etc. The reduced or shelved investment plans are Britain´s loss. That applies to the investors that are already in Britain. New investors will not even seriously consider the UK in the future. The great majority of such investment will flow to the EU-27 countries instead, unless there is something very specific about the UK that will attracts such investment, despite the extra costs and bureaucracy outside the EU´s Customs Union.

Less investment = fewer jobs, lower incomes, lower tax revenue and thus lower public expenditure.

I lived through the late 1970s and early 1980s in the UK. I am not nostalgic about high levels of unemployment and a palpable sense of decline at all levels of the economy and society. It was not a pretty sight then and it would be equally disastrous in the future. The difference is that while economic misfortune was mostly not self-imposed then (Thatcherism most certainly accelerated the process), it would be now.

My joy at becoming German is tempered by my concern, as a Briton, for the future of the UK.

There is nothing inevitable about the current Brexit trajectory and the negative consequences that have already started to flow from it.

The current Brexit path is the result of inept political leadership, Europhobic ideology and Tory in-fighting. No more, no less.

But there is still time to adjust the Brexit choices being made.


It´s the emotions, stupid! or the politics of emotions

James Carville will be remembered as the strategist during Bill Clinton’s 1992 presidential campaign that gave us what has become the political mantra: “It´s the economy, stupid!” as a reminder of what to focus on. But a generation later, as we enter a new political phase, facts (e.g. the unemployment rate, GDP growth, exports, contribution of immigration, etc.) are no longer so important. Furthermore, expertise, evidence, independent analysis, etc. do not seem to carry as much weight as subjective feelings or emotions. This is the politics of emotions and perhaps it is time for “It´s the emotions, stupid!” to enter the political lexicon.

Post-factual politics / politics of emotions

The Brexit Referendum was the first serious and persistent post-factual political campaign in Britain. This was not necessarily something new but rather a culmination of a process which has been evolving for some time. It was already at an advanced stage of development during the Scottish referendum in 2015, where the emphasis of the campaign was very much on tapping one particular emotion: fear. The campaign was unrelenting in its focus on the negative implications of Scotland leaving the UK.

The fear-based campaign, mainly by those seeking to retain the status quo, did not go entirely according to plan. Despite the British government milking the fear factor for all it was worth, it was not sufficient to persuade the Scottish electorate to remain in the Union. The polls were fairly consistent in showing that despite the unrelenting emphasis on the negative, the majority of adults in Scotland were still tending towards voting in favour of seceding from the UK. It was only in the last few days of the campaign that a shift towards remaining part of the UK occurred, coinciding with the British government changing tack and unashamedly bribing the voters with all manner of concessions. Even so, it just about managed to gain a majority for the Union to remain intact. The highest recorded turnout (85%) in the UK resulted in a narrow vote (55.3%) against Scottish independence.

The recent EU referendum Remain campaign, led by Mr David Cameron and his then heir apparent, Mr David Osborne, clearly failed to learn the lessons of that narrow, last-minute turnaround in the campaign. The key strategy devised by the Remain campaign leading to the ballot on the 23 June 2016 was more of the same, otherwise known as “Project Fear”. All the possible negatives, especially the economic ones, of voting to leave the EU were magnified and pushed for all they were worth by the Remain campaign. Vast amounts of data analysis and facts were deployed with the tradition emphasis on “it´s the economy, stupid!” These arguments were reinforced up by various statesmen, such as Barack Obama, as well as reputable institutions such as the OECD, World Bank, IMF, economists, etc.

George Osborne, the then Chancellor of the Exchequer (Minister of Finance) was tasked with carrying out the economic analysing and publicising the Treasury´s assessment of the implications of Brexit. The basic conclusion was that Brexit would tip the economy into recession, 500,000+ people would lose their jobs and wages would decline, as would house prices. In 15 years, the economy would be 6.2% smaller, resulting in a loss of £4,300 for every household. The expectation was that this would put the fear of god in people and deliver a government victory.

It was plausible, it was fact-based and it preyed on people´s worst economic fears. No effort was made at all to make a case for remaining in the EU; I cannot remember a single discussion or comment or a positive nature that was ever pushed by the Remain campaign. The result is well-known: 52% voted to leave, 48% voted to remain. It was undoubtedly the single most momentous political result of recent times and will affect Britain and the rest of the EU for the foreseeable future.

The lessons of the Scottish Referendum, combined with the post-factual approaches deployed by Donald Trump across the Big Pond, were clearly analysed much more carefully by the Leave Campaign than by the Remainers. They too decided to focus on people´s fears but from a very different angle. It was not based on sophisticated econometric models that almost no one understands to magic a 6.2% reduction in GDP and thus a loss of £4,300 in the next 15 years. The Brexiters’ approach was very simple – it was exaggerated, it was not fact-based and it pandered directly to people´s fears and concerns today. If Remain’s focus was characterised as “Project Fear”, the Brexiters´ approach can be summed up as “Project Lies”. It was underpinned by a determination to dismiss and discredit all government and/or independent analyses, facts and expertise as being somehow biased because they had to be benefiting from EU funds.

The Brexiters concentrated primarily but not exclusively on the fears of the non-working, working and lower middle classes in the UK. Fears of immigrants (from the EU, though they account for less than 50% of all immigration), fears of job losses (though the UK has almost full employment – 4.9%) and stagnating wages (though almost all studies suggest otherwise), fear of losing control over our lives (i.e. the EU / European Parliament / European Commission making laws and regulations instead of the UK Parliament), all combined with a hefty dose of resentment towards the elites (taking more than their fair share of the economic pie). This was all combined with arguments about the NHS (an exaggerated £350m-a-week currently going to the EU which would be ploughed into the NHS instead – not a penny has been redirected so far), the housing crisis (blamed on EU immigrants and wealthy foreigners, though Britain has failed to build adequate housing for many decades), etc.

Emotions / fears / concerns galore

History has shown over and again, that strong emotions / fears / concerns can be exploited by those who offer change in the form of simple but evocative messages; Donald Trump has demonstrated the power of simplistic but populist messages, using Twitter, regardless of grammar or facts. The reason why these emotion-laden messages are so powerful is that they are not at all abstract (such as the Treasury / OECD / IMF / World Bank models) but embedded in people´s biases and/or experiences.

There is plenty of evidence that for decades the non-working, working and lower middle classes in many Western countries have been lost economic ground, while the elites have prospered from the ongoing forces of globalisation, greatly accentuated recently by the austerity drives (see below). Inequality has grown, wages have stagnated, tax policies have favoured the better off, while those dependent on key elements of the welfare state, including the middle classes (child benefit, tax credit, etc.), have systematically lost out as the impact of austerity has spread out. This has not been helped by the privately educated/ elites controlling successive governments, yet failing to recognise or deal with the problems faced by normal individuals and their families.

Referendums may work quite well for specific issues, such as whether to allow abortion or same sex-marriage but they are not at all geared to answering complex issues, such as whether to remain in the EU in the form or a simple “yes / no” answer. So when the opportunity arose to give the government / elites a bloody nose, it was obviously just too good an opportunity to pass-up, despite (or partly because of) the messages being put out by Project Fear.

Having gone through with the referendum, the new Conservative government cannot simply backtrack from the outcome of the vote. Doing so would fatally undermine democracy in Britain and unleash potentially far worse than what we are currently witnessing in the form of the current wave of populism. This populism seeks to take advantage of the fact that many people are no longer interested in facts and figures or weighing-up the pros and cons of different arguments. They are much more minded to follow their instincts or biases, as vented by people such as Donald Trump, Nigel Farage, Marie le Pen and quite a few others in Italy, Poland, Hungary, etc.

Raw emotions as politics (according to Home Office figures, 1,000 Syrian refugees were resettled under the Vulnerable Persons Relocation scheme in 2015. 1+ million refugees were accepted by Germany)

This strain of post-factual politics of emotions is not predicated on the traditional political dividing lines of left (Socialism/Social Democracy) or right (Conservatism/Republicanism) – it is cross-cutting in nature. The trigger issues are broad and generic yet connected with emotional impulses strong enough to transcend traditional party lines and similar allegiances. This was evident in the Brexit campaign, it was seen in the US Presidential election and strains of it are evident in France and other European countries. It is here to stay.

The emotive themes of the post-factual politics of fear are fairly common, regardless of which country is in question. This includes fear of powerful elites (e.g. Brussels/Washington D.C.), foreigners (EU / Mexicans, refugees, etc.), globalisation (trade deals, China, etc.), terrorism (Al Qaida, IS, etc.), cultural change (Islam, immigrants, refugees, etc.), etc.

No amount of logic, analysis or expertise can counteract the emotional triggers that many people have to such themes. A clear example of this was the deliberate dismissal of “experts” during the Brexit debates. Michael Gove made the situation crystal clear whenever confronted with facts/figures/experts that did not align with the case he was making for Brexit with the following: “People in this country have had enough of experts.” Truth be told, that particular soundbite had the ring of truth about it. People would much rather trust their own experiences / emotions / prejudices than listen to what experts have to say, unless those views conform with their world view and preferably in easily digestible messages (not exactly something that experts excel at).

The main themes include the following:

  • Control of own borders
  • European Union
  • Patriotism/Nationalism
  • Immigration
  • Refugees/asylum
  • Muslim culture
  • Terrorism
  • Trade / Globalisation
  • Elitism / 1%
  • Lower real incomes.

Other themes could have been added to the list, such as same-sex marriage, transgender, abortion, global warming, etc. which are all highly emotive, but the list illustrates the general issues. In the case of Donald Trump, a whole new set of additional issues could have been added such as racism, xenophobia, bigotry, misogyny, narcissism, etc. One can only hope that Trump´s particular strain of post-factual populism is not the future of politics, though I fear it already is.

Variations on a theme

Almost all the themes are negative in nature; they instill anxieties and fears in people. The only exception is nationalism / patriotism which, generally leads to positive feelings such as pride in one´s country. History is replete with examples of how easily both positive and negative feelings can be manipulated, misused and abused. Patriotism is particularly strong in the US, with its melting pot but less so in Britain, with its former empire. The Germans, the culprits of two World Wars, are rather more interested in forging a European identity, though this is has been slowly changing in recent times.

There are clearly variations. The European Union (EU) does not figure large in people´s perceptions in the USA but is something that the UK has been in two minds about since the formation of the EEC in 1958: there has always been an ambivalent relationship involved. The opposite applies to Germany: it has traditionally had an unquestioning stance to the EU where traditionally the French have made the strategic decisions (Marie le Pen would call for a referendum to pull France out of both the EU and the Euro) and the Germans have paid for them. This started changing during Gerhard Schröder´s Chancellorship and accelerated with the Euro crisis, and the advent of the Alternative für Deutschland (AfD), which initially wanted out of the Euro but under new leadership has evolved into an anti-immigrant/refugee/Islam party and could eventually become anti-EU.

The perception in Germany was initially that it was paying for the economic and other economic mistakes of other EU countries, especially the Mediterranean ones. This evolved into concern over the dangers to the Euro risks for Germany itself, followed by a blistering critique of the European Central Bank´s policy of near zero interest rates and quantitative easing. The country is also experiencing angst about its capacity to absorb over 1 million mostly Muslim young men that the other EU countries (with the exception of Austria and Sweden) were completely unwilling to share. More recently, this has transmuted into concern about terrorism and attacks on German soil.

A clear trend is evident: the politics of emotions is tapping into fears and concerns about immigration generally and refugees and asylum seekers specifically. The key immigrants in the USA are the Mexicans, something that the US has a long history of, not all of it proud, such as the forcible deportation of 500,000 – 2 million people during 1929 to 1936. Trump milked this theme to the maximum extent possible with his talk of building a “big beautiful wall”, of making Mexico pay for it and of getting rid of illegal immigrants from day one of his Presidency. None of this was based on fact but it hardly dented his popularity among large segments of the population, including many of Hispanic descent.

The referendum debate on immigration in the UK has verged on the xenophobic and racist, despite the fact that EU immigration involves mostly white European migrants. Immigration was and remains the most vivid expression of people´s concerns. In this respect, Germany is different to other nations by virtue of its role in the past in respect to groups such as Jews, Roma, disabled, etc. For this reason, there is no indication at present of Germany reacting badly to EU migration (but see discussion below about recent influx of refugees), though it is happening on an unprecedented scale which dwarfs the immigration in countries such as the UK (1,13 million in 2015). This may change in time, though the ageing population structure of the country is a countervailing factor.

The ire of the Germans, particularly evident during 2015, was focused on the implications of Germany absorbing it 1.1 million asylum seekers and refugees and the still relatively large numbers expected in future (the forecast is 300,000 in 2016). It all started well, with Germans going out of their way to be welcoming but quickly deteriorated as the cultural and economic strains became apparent. To be fair, the wave of intense concern, particularly notable during the New Year period, has waned as the sheer numbers being received by the country have abated in 2016. A blip was still evident during the summer due to various terrorist and other incidents.

In the UK, known for its open racism during the 1950s to 1970s (recall private landlord adverts: No Blacks, No Dogs, No Irish), recent anger towards EU migration started initially with a focus on the Poles and then extend to the Romanians (especially Roma) and pretty much all EU immigrants have implicitly been targeted during and since the referendum in June 2016. Who knows if and when this feeling may be extended to all other migrants, regardless of origin or the length of time they have lived and worked in the UK. The populists of the post-factual era are sure to milk this particular negative sentiment, especially during the drawn-out period of Brexit negotiations that will last at least until 2019. This is all the more likely because the British government still has no plan for Brexit and the other EU nations are highly unlikely to offer Britain a good Brexit deal. The risk of other countries following suit is just too great for this to happen.

Pressing the sore spot

The next two themes are particularly emotive, namely fear of terrorism and the influence on Muslim culture on Western societies. This is a particularly rich vein for post-factual politics, since this is probably where the most intense fears reside. I have shown that people´s perception of the size of the Muslim population is totally out of proportion compared with the reality.  The following illustrates the data for the three countries in question:

Country        Muslim Population % of Population % 2030
Germany 4.1 million 5% 7.1%
UK 2.8 million 4.6% 8.2%
USA 2,6 million 0.8% 1.7%

 

These data refer to 2010 as I could not find more recent comparable information for the three countries. Since 2015, there would have been an increase of approximately 1.1 million Muslims in Germany alone (i.e. 6.3% of the population) and this will continue, albeit at a lower rare. Overall, the Muslim share of EU´s total population was 5% in 2010 and is expected to increase to 8% by 2030. The fact that the Muslim population remains relatively small seems to cut little ice with many people, especially the older age groups. There is intense concern about the possible loss of cultural identity, combined with strong doubts about the willingness of the Muslim communities to integrate. This is and will continue to be a powerful emotion to tap into; many are intent on exploiting it.

Fear of terrorist attacks is at least as powerful, if not more so. The reality is that the chances of dying in a terrorist attack while on a plane is 1 in 25 million and the overall average chances of dying in any kind of terrorist attack worldwide is 1 in 9.3 million. There were at least 155 Americans killed by police officers in the United States in 2011, which means that people are about 10 times more likely to be killed by a law enforcement officer than by a terrorist. Worldwide, people are 517 times more likely to be murdered, 500 times more likely to die in a car accident, 41 times more likely to die in natural disasters and 1.8 million times by more likely to die of heart disease that being killed in a terrorist attack. However, none of this matters because negative emotions Trump facts (pun intended) – every time.

But I am falling again into the trap of talking about data / statistics / evidence in the post-factual political age.

The combination of fear of cultural change as a result of the perceived “Islamification” of Europe and the clear association with terrorism is such a potent mix in people´s minds and there is little antidote to it, other than public education. Unfortunately, not only is this imperfect, it also takes a hell of a long time to permeate minds and influence public perceptions, time which the proponents of post-factual politics will put to use in the pursuit of a simplistic but emotionally charged agenda.

The last set of themes listed above concern an amalgam of globalisation/trade deals/deteriorating incomes/elitism. In this particular case, I can relate to the panoply of emotional pulls what populists in the post-factual era are latching on to.

There is increasing evidence produced by academics such as Thomas Pikkety, who argues that the rate of capital return in developed countries is persistently greater than the rate of economic growth and that this not only causes wealth inequality, but that inequality will also increase in the future unless redistribution occurs through a progressive global tax on wealth.

This is intensifying the “them and us” divide and connects with a range of themes relating to the stresses and strains caused by international trade and globalisation, combined with growing social polarisation / inequality. This is the discourse of the 1% / elites taking a disproportionate bite off the economic pie compared with the non-working/working population (globally speaking, anyone with an income of EUR 30,000 p.a. belongs to the 1%). The lower and middle-income groups have also experienced the brunt of the effects of austerity, combined with the increasing job insecurity, resulting in deteriorating real incomes and state benefits. This led to a pronounced backlash against the elites, including the political and financial professions. These trends more than compensate for the countervailing influence of the remarkably low levels of unemployment (4.9% in USA/UK and 6.1% in Germany, September 2016) which pertain today.

What of the future?

So what does the post-factual, feeling based politics mean for Britain, Germany, Europe and indeed the rest of the world?

It means that are all in for a roller coaster political ride for the foreseeable future.

And it also means that the democracies discussed in this post are in deep trouble, unless the global economy not only starts growing strongly soon, but the resulting economic benefits are much more equally distributed in the future.

But the chances of both happening any time soon are about as high as the likelihood of being caught in a terrorist attack.

 


Brexit and the Politics of Wishful Thinking

It has been a little while since I last posted something on the AngloDeutsch Blog.

The reason is simple: the UK´s referendum decision in favour of Brexit was not entirely a surprise but it still came as a shock that the majority of my fellow Britons voted to leave the European Union (EU), a club that they had been part and parcel of for over four decades (Britain joined in 1973), even if it has always been a less than wholehearted member.

Since 23 June 2016 I have observed the unfolding UK-EU divorce while trying to come to terms with that it means for Britons, for Europeans and of course for me personally, a Briton who has lived in various parts of the EU and is a resident of Germany.

I remain as shocked as ever but unlike many Remainers who retain dim hopes that Brexit might somehow be averted, that Parliament could override the outcome of the referendum or that a second referendum could be held when the actual terms and conditions of Brexit have been negotiated, I am expecting Brexit to occur. Not only that, but I do strongly believe that having voted for Brexit, it must happen. The referendum was a democratic process, the decision was clear and democracy would be undermined, perhaps fatally, by anything other than Brexit.

Slow-burning Brexit fuse

This is not to say that I think Brexit is a good thing for either the UK or the EU, as I have made clear in my blog. I remain as convinced as ever of the opposite, even if a growing number of people are jumping on the bandwagon to claim that there has been no crisis post-Brexit. This is hardly surprising since Article 50 triggering the process of withdrawal from the EU has not yet been invoked, Brexit has not yet happened and the Bank of England has been very active in pre-empting a possible crisis by launching an aggressive “sledgehammer” stimulus package. The real Brexit impact will be medium- to long-erm in nature; it will have a slow burning fuse but it will eventually be more keenly felt in terms of investment, jobs, real wages and wealth.

The most notable thing about the three months since the referendum is how little progress has actually been made in terms of defining what Brexit actually means. Since there have been no notable decisions made, investors have not had anything substantive, positive or negative, to react to and are keeping a watching brief on what happens. This in itself is a negative, albeit not one that the Brexiteers would acknowledge.

The extent of the current policy position of the new British Prime Minister, Theresa May, boils down to a political soundbite: “… Brexit means Brexit, and we’re going to make a success of it.”

Beyond this, very little is clear about the British Government´s Brexit position in respect to fundamental issues such as:

  • When Article 50 will be triggered to officially start the Brexit negotiations (sometime in 2017);
  • Whether Parliament will have a vote on Brexit;
  • If the aim is to stay in the common market or not (hard vs soft Brexit);
  • When Britain will actually leave the EU;
  • How long it will take to sign new trade agreements with the EU and other countries;
  • What the rights and responsibilities of the EU citizens living and working in the UK;
  • What does Brexit mean for Scotland and Northern Ireland;
  • The same for the Britons living in EU countries, etc.

The only firm policy position is that the UK will not accept one of the EU´s fundamental requirements, namely the freedom of movement of people, and insists upon taking full control of the borders in terms of who is let into the country. These are non-negotiable for the government.

Wishful thinking

Theresa May said in advance of her first cabinet meeting as Prime Minister: “So we will not allow the country to be defined by Brexit; but instead build the education, skills, and social mobility to allow everyone to prosper from the opportunities of leaving the EU.”

However, Brexit will undoubtedly define her government´s work for the current political term. Not only that, it will involve nigh on Herculean efforts to unpick over 4 decades of close legislative, economic, trade, cultural, financial, environmental and other ties. Without a doubt, Brexit will define the next 2-3 UK governments´ policy agenda and thus the country´s destiny. Whatever the Prime Minister may suggest, Britain has already been defined by Brexit, certainly for the other 27 countries, and this will only intensify in period until 2019 when the divorce proceedings are likely to conclude.

The wishful thinking does not stop there.

The Eurosceptic knives are out and being sharpened; the Government already stands accused of not doing enough to bring about Brexit, as if it such a complex and critical issue in terms of Britain´s future economic wellbeing is something that could be decided upon at the drop of a hat. The Brexiteers may have gone into the referendum in a blithe manner in terms of their complete lack of post-referendum plan but at least they are being consistent.

The headlong rush towards Brexit is irresponsible. To be sure, Britain has the right to unilaterally withdraw from the EU at any point of its choosing but there is broad consensus that this would be disastrous for all concerned. The default position is thus the negotiated route to Brexit, despite the unrest among the hard core Brexiteers. However, choosing to enter complex Brexit negotiations without adequate analysis, preparation and forethought in respect to Britain´s long term interests would be the equivalent of tying both Britain´s metaphorical hands behind its back in the forthcoming marathon negotiations with the EU. Just as in the case of unilateral withdrawal, there would only be losers from such a process. The Brexiteers have won the debate, so whatever their ideological desire to head for the exit door host-haste, they will just have to rein their horses in the interests of their country.

There is a school of thought that Mrs May has made a strategic mistake by offering key ministerial positions to leading Brexiteers as Boris Johnson (Foreign Office), David Davis (Brexit Negotiations) and Liam Fox (International Trade). I think it has actually been a strategic masterstroke on her part. The political onus has been neatly shifted to the Three Brexiteers, who must now take responsibility for preparatory work, negotiations and whatever outcome Britain is able to negotiate with the EU. The Brexiteers cannot claim to have been undermined by the Remainers if the critical political posts are all held by the Three Brexiteers.

Row, row your boat…

The advantages of this approach are already becoming evident. Among the chaos and obfuscation (which might be characterised as Project Lies or Project Fear, depending on which side of the fence you sit on) evident during the referendum campaign, there were a few concrete promises made by the Leave Campaign, though the Brexiteers are busily rowing away from them:

  1. GBP 350 million per week will be invested in the NHS: Nigel Farage (UKIP) admitted that it was a mistake to make such a claim and that the NHS would not get the extra funds.
  2. Article 50 to leave EU will be immediately triggered: Liam Fox (Conservatives) has admitted that Britain is nowhere near being prepared to begin negotiating Brexit and that this will take time.
  3. Brexit is a relatively straightforward process that can proceed quickly: David Davis (Conservatives) admitted that the Brexit negotiations may be the most complicated negotiation ever and that they will start sometime in 2017, followed by two years of negotiations.
  4. Introduction of a points based immigration system to take back control of the borders: Boris Johnson (Conservatives) has abandoned the plan for a points based immigration system promised during the election campaign stating that what matters is taking control of the borders.
  5. A favourably UK-EU free trade agreement will be negotiated as the EU has more to lose than the UK: David Davis (Conservatives) admitted that it might not happen and that the UK might exit without a trade agreement, thus having to revert to less favourable WTO tariffs instead.

The above can be interpreted in one way: the loud and clear sound of retreat can be heard and the buglers are none other than the Three Brexiteers.

For her part, Theresa May is keeping her cards close to her chest, holding bilateral preparatory meetings with the French, Germans, EU, etc. and repeating her “Brexit means Brexit” mantra. The three leading Brexiteers are the ones having to do all the running, carry the weight of political expectation and toil under the pressure to come up with a coherent plan for Brexit.

They are not giving the impression having much of a clue about what they are doing, let alone being capable of coordinating the process among themselves in a manner which inspires confidence about an outcome that will be at least as much in Britain´s interest as is the case today. Their fellow Eurosceptics in the Conservative Party are increasingly restless and if the current state of affairs continues, Mrs May might just be tempted in the future to relieve the Three Brexiteers of their duties. If she were then to appoint more capable replacements, whether Brexiteers or not, that might not be such a bad outcome and the Brexiteers would only have themselves to blame.

Choppy waters ahead

It takes two to do the Brexit tango, so how is the EU preparing for it?

Firstly, the rest of the EU insists upon Article 50 being triggered as soon as possible for the simple reason that an indeterminate period of uncertainty can only be negative for Britain and for the other EU countries. Ironically, the EU is pushing much harder for a quick Brexit than the Three Brexiteers and the rest of the government. However, since it cannot do anything about it, the rest of the EU is resigned to the likelihood that the UK will not invoke Article 50 and enter the negotiation phase until sometime in 2017, possibly later 2017 once the French and German General Elections are safely out of the way. Furthermore, the EU is firm about the fact that it will not start Brexit negotiations, formal or informal, until Article 50 is triggered by the UK. The hard core Brexiteers must be as bitterly disappointed about this likely delay as the rest of the EU, but at least they have finally one thing in common.

Secondly, it is not feasible for Britain to remain in the Common Market or join the European Economic Area (assuming the existing EEA members do not veto the UK from joining this club – the early indications are that these relatively small countries might not appreciate the prospect of being joined by what would become the dominant country, resulting in very different political dynamics) unless freedom of movement of people is guaranteed. Since this is a Rubicon that will not be crossed by the Brexiteers and/or the British Government, this option appears to be out of the question. The EU is inflexible on this fundamental issue, as illustrated by its handling of the Swiss referendum and the failed attempt to restrict freedom of movement while remaining in the EEA / common market. The omens are not good and the implication would be “hard” Brexit – leaving the EU and single market altogether without a free trade agreement with the EU.

The EU members are also unusually strong and consistent on other important issues.

Firstly, to make the UK divorce too easy would be to encourage other EU countries to consider leaving the EU club. Put simply, this is the very last thing that the other leading EU countries want. The negotiations will not be a stroll in the park, whatever the Brexiteers may claim. This is wishful thinking on their part and is misleading to it.

Secondly, it is entirely out of the question for the UK to expect to have its Brexit cake and eat it too. In other words, whatever is negotiated with the UK cannot possibly be as good as the current situation as a full and (formerly) leading member of the EU, something that the three Brexiteers continue to imply. Forget that sort of wishful thinking; it simply does not add up. If you join a club, you pay your membership fees, live by the rules and reap the benefits. If you choose to leave the club, you do not pay the fees, do not abide by the rules but do not get the benefits either. Period.

Thirdly, Angela Merkel has made Germany´s view unusually clear by stressing that Brexit is irrevocable (a one way ticket and Britons cannot expect otherwise) and that it is not feasible for the UK to be part of the common market without the EU´s four freedoms, one of which is freedom of movement. She has also stressed that Brexit negotiations cannot be a “cherry picking exercise” of keeping the good economic, trade and finance bits and ditching the rest. For someone renowned for mincing her words, this is as clear a statement as the Three Brexiteers will ever hear; not that they are paying any attention in their delusion.

The British government will also wish to factor in other important considerations in securing a Brexit deal. Whatever it turns out to be good, bad or indifferent, it can be vetoed by any of the remaining 27 countries. Any marginal hopes that Britain might harbour to somehow remain in the Common Market while avoiding the freedom of movement of people can and most probably will be vetoed by Visigrad nations such as Poland.

Loaded dice

There is thus a whole series of pitfalls to be avoided and the reality is that it will be very hard for a deal to be agreed within the maximum prescribed period. The negotiations are loaded in favour of the EU due to the time limit to finalise negotiations once Article 50 is triggered. Two years (unless there is a unanimous agreement by 27 nations to extend the negotiating period) does not sound like ample time to complete “…the most complicated negotiation ever” (David Davis) and do so in Britain´s favour while also securing a qualified majority of the EU leaders and the 27 Parliaments across the EU (as well as the European Parliament – see below).

As if that little lot was not enough to give the Three Brexiteers and their ilk food for thought, the EU has just appointed its team of Brexit negotiators and no one can claim that the intention is to give the UK and easy ride. The European Commission (EC) has put a Frenchman and former EU commissioner, Michel Barnier, in charge. The UK media was pretty clear about the possible implications. The Sun branded him “anti-British” and the Evening Standard called him the “scourge of the City”, with important implications given the significance of the financial sector and the sensitive issue of the UK retaining financial “passporting rights” without which a chunk of the financial sector concentrated in London could shift to Frankfurt, Paris and other EU cities.

Furthermore, the European Parliament has selected the MEP and former Belgian PM Guy Verhofstadt as the lead Brexit negotiator, since any deal agreed by EU Leaders will have to be ratified by the European Parliament, an institution which has often been in the crosshairs of the leading Brexiteers. The media immediately branded Verhofstadt a “diehard European federalist,” the worst possible insult that could ever be levelled by a Brexiteer. Without approval by the majority of the European Parliament, there will not be a Brexit deal. Perhaps Nigel Farage was a little unwise to gloat about Brexit at the European Parliament while still holding on to his seat and salary as a MEP (17 years and counting). Some might have concluded that Brexit was mission accomplished, but obviously not our Nigel.

Dream on

So the Brexit battle lines are being drawn.

It is evident that the EU´s position is a lot clearer than that of the UK, where pretty much everything is still up in the air, other than the intention to control its borders (despite being an island and not being part of the Schengen area) and avoiding freedom of movement of people (despite having almost as many Britons living in other EU countries, benefiting economically from EU migration and receiving the majority of its immigration from non-EU countries such as the Commonwealth).

The UK has yet to come up with the semblance of a cogent Brexit plan (“soft” or “hard” for a start), let alone one which unites the leading Brexiteers (a substantial minority of the Conservative Party) while also satisfying the majority Remainers in the same party. This is going to be tricky in the extreme: the Conservative Party has a slim overall majority of 16 in Parliament and UKIP will continue to breathe down the Conservatives´ political neck (the Labour Party is even worth mentioning, given its ongoing chaos and disarray).

Britain will need uncommon diplomatic and negotiating skills (eh hem! – yes, I am thinking of our Foreign Secretary), as well as a hefty dose of luck in navigating through the choppy waters coming up in 2017 and still coming out of with a Brexit deal, let alone a favourable one, whatever the Three Brexiteers and the British government may claim.

The likelihood of actually securing a deal that is at least as favourable as the status quo is nigh on impossible (though the EU is first and foremost a political construct and since politics trumps everything else, the possibility cannot be completely excluded). The prospect of the UK having its Brexit cake and eating it at the same time appears to be a load of wishful thinking and delusion. Everyone but the Brexiteers can clearly see the writing on the EU wall… in capital letters, underlined and bold.

© Ricardo Pinto, 2016, AngloDeutsch™ Blog, www.AngloDeutsch.EU


The British housing crisis: is EU migration also responsible?

Let us get down to brass tacks: Britain has a serious housing crisis. When demand for housing (people wanting to rent or buy) exceeds supply (the stock of housing) the effects are not good for society. House prices and rents rise, making it difficult for people to pay for their accommodation. This reduces the net income available for other things, makes people anxious and directly affects their quality of life.

If people migrate to the UK or wealthy foreigners invest in the housing market, this reduces the housing supply for the domestic population unless construction goes up. This drives-up house prices and the levels of frustration, especially when people have to share their homes with their parents/children, are priced out of living in their communities or see empty houses that are investments, rather than homes. This is especially so in Britain, a nation of home owners and this state of affairs leads some to conclude that the housing crisis is caused by the EU and its freedom of movement principle. It leads to a perception that perhaps EU mobility results in a lack of housing for the native population. This is powerful argument during the period leading up to the EU referendum in June 2016; it connects with the EU immigration and EU benefit tourism, topics I have previously written about, and is presented as another reason for Britons to vote to Leave the EU (i.e. Brexit). So it is important to address the nature of the British housing crisis and the EU’s role in it.

The first thing to be said is that there is no shortage of analysis of either the housing problems or the possible solutions, but the latter basically boil down to balancing housing demand and supply, together with the political will to solve the crisis.

My home is my castle: demand for housing

Numerous factors influence housing demand. A critical factor is price: at higher prices, real incomes fall and people will reduce their demand while alternatives to owning a property, such as renting, become more attractive. There is a multitude of other factors that are important, such as population dynamics (population size, migration, birth and death rates, age structure, etc.), incomes of households (some may shift from renting to buying, move to a bigger property, buy a second property, a holiday home, etc.), social and lifestyle trends (e.g. late marriages, divorce rates, decisions to remain single, etc. all increase single households and thus demand), availability of credit and interest rates (higher rates make ownership less affordable while lower ones achieve the opposite and restriction in the supply of credit reduces demand for housing and can lead to a fall in house prices) and other influences such as government incentives (to buy, to rent or to buy to rent) and expectations in terms of house /land price developments (speculation).

Since all the above influence housing demand, estimating future demand is a complex process. What is simple though is that immigration, whether from the EU or elsewhere, is only one factor among many others, the majority of which are more influential in terms of stimulating demand for housing in the UK.

Nevertheless, as far as the EU’s freedom of movement of people is concerned, there are two further issues to consider:

  • EU migrants are a sub-set of the migrants to the UK. In a separate post, I showed that of the 498,040 people who migrated to Britain in 2012, 80,196 or 16.1% were Brits returning home, 157,554 (31.6%) were from the EU and 260,290 (52.2%) were from the Commonwealth and other countries that Britain is entirely responsible for, rather than the EU;
  • EU migration is not a one way street and not all roads lead to London and the South East. In the same year, 321,000 people left the UK, a proportion of which migrated to other countries in the EU.

Consequently, even if EU migration was the only issue affecting demand for housing, which is clearly far from being the case, EU migrants do not constitute the majority of immigrants to the UK. Furthermore, the same process is happening in other EU countries that receive Britons.

A number of housing demand studies demonstrate the same trend in the UK: housing demand is increasing significantly and the government and the rest of the housing system, not least the planning system and the construction industry, need to respond in order to ensure that the supply covers the future demand. After all, it is not unusual for populations to increase and housing policy and system must respond in order to deliver affordable, quality housing. The public has the right to expect this irrespective of the particular set of factors that may drive housing demand (i.e. whether immigration is an issue or indeed whether it is from the EU or elsewhere) at a particular point in time.

A comprehensive estimate of housing need and demand in England was published by the Town and Country Planning Association. It estimated that England alone required 240,000 – 245,000 additional homes each year until 2031 in order to meet rising demand. Many similar projections have been made long before EU migration to the UK became an issue of debate post-2007.

Housing supply: decades of neglect = housing crisis

The issue then is how much housing is being built and is it sufficient to meet the demand for 245,000 new units per annum? The UK housing construction data (supply) are presented in the Table below.

Table 1 UK Housing Construction

Source: Gov.uk, Live tables on house building, Table 209

A few points are worth noting based on the Table:

  • Housing construction (permanent dwellings completed) in England have fluctuated between a peak of 170,610 in 2007/8 and 108,870 in 2011/11;
  • The point during which it was perceived that there was an acute housing crisis was around 2005 but since then, the trend in terms of housing supply, albeit fluctuating slightly, has actually been downwards;
  • By definition if the target for England is 245,000 new units per annum, the equivalent for the UK will be much higher. The last year of housing construction data (2014-5) shows a gap of 93,000 even against the lower target for England;
  • In a well-functioning housing market where the citizens, planning authorities, construction industry and the government jointly perceive a housing crisis, the normal response would be for housing supply to increase to reach the target of 245,000 new housing units per annum for England. If this does not happen, it adds to the affordability pressures experienced;
  • If here is such a systematic lack of construction, then surely the respective people in charge of housing policy, finance, planning, construction, etc. are responsible.

To Scapegoat or not to scapegoat (or holding a mirror to British policy makers)

A considerate British voter in the forthcoming EU referendum might reflect on the following issues:

  • The EU has no control in the housing sphere: this is exclusively the remit of national governments, in this case successive UK governments;
  • There are many factors affecting demand for housing, of which EU migration is only a secondary factor;
  • The EU related migration accounted for 31.6% of the migrants to the UK in 2012, but the UK also sent its migrants to EU countries – the EU freedom of movement cuts both ways;
  • The UK has systematically produced fewer housing units than it needs for a period of decades despite projections of massive unmet demand for housing ;
  • The UK, including its politicians, its construction industry and its planning system (local authorities) are responsible for ensuring that supply keeps-up with demand and that housing is affordable. This requires responding to changes in housing circumstances, regardless of what is driving them (e.g. prices, birth rates, speculation, constrained land release, immigration, interest rates, tax incentives, etc.);
  • Despite mounting pressure, regular public outcries, evidence of shortage and affordability problems, etc., the UK only managed to build a paltry 150,000 housing units in 2014-5. This is a damning indictment of Britain, not least its politicians, policy-makers and industry.

It is up to each individual to form their own opinion of where the blame for Britain’s chronic housing crisis should rest. Scapegoating EU migration (which took off from 2004) for problems which have been systematically neglected in the UK amounts to a disgraceful attempt to blame others for issues which Britons have failed to tackle over and over again and are still doing a miserably bad job with.

In this context, it is worth addressing two issues which policy-makers, politicians and the Leave the EU campaign will almost certainly raise in defence of the indefensible: the lack of adequate and affordable housing in the UK, which is a basic human right.

Clutching at straws 1: the crowded island myth

Many, if not most, Britons appear to be convinced that the UK is a very crowded island and that there is simply no space left for housing construction, let alone to accommodate migrants from the EU or anyone else. Certain segments of the media that are biased against the EU, as well as the general Leave campaign, including populist political parties, are keen to emphasize this argument, so let us examine the claim.

The most comprehensive analysis of this issue (UK National Ecosystem Assessment) concluded that only 6.8% of the total land area of the UK is urban (10.6% of England, 1.9% of Scotland, 3.6% of Northern Ireland and 4.1% of Wales). But being urban does not necessarily mean that it is built upon since such areas also contain gardens, lakes, etc. The most detailed analysis ever conducted found that only 2.3% of England is built upon, the rest is natural. Elsewhere in the UK, the figure is less than 1%. Contrary to popular misconception, only a tiny fraction of Britain has been concreted over. Britain is not a crowded island. It can and must build more housing for the benefit of its citizens.

Clutching at straws 2: EU preferential treatment in accessing social housing myth

Another common perception is that EU citizens are benefit tourists, and that they strain the welfare state by having a higher demand for social housing. But the data show that about 17% of UK-born and 18% of foreign-born individuals live in social housing. That means that foreigners are on par with native Britons when it comes to access to social housing. However, when it comes specifically to EU migrants, the popular perception is even more incorrect. Studies demonstrate that citizens of EU-8 countries who arrived in the UK after accession are 57% less likely to live in social housing than native residents. More recent studies indicate that over 90% of immigrants in the UK are in households that are eligible to apply for social housing (p.3) and confirm that EU (and EEA) citizens are less likely to be in social housing than Britons.  The research also shows that, once factors like the demographic structure, location and economic circumstances are taken into consideration, immigrant households are significantly less likely to be in social housing than equivalent native households. Another popular myth bites the dust.

Build, Build, Build

The housing crisis is fundamentally a matter of demand and supply and the policy choices each country makes about how to prioritize public investment and other policy decisions. For decades Britain has emphasized home ownership as the one and only housing policy priority. It has constrained social housing construction for ideological and financial reasons, while at the same time forcing social housing to be sold at discount. Its recent policies have stimulated a boom in buy-to-rent, which has increased private renting but also boosted house prices and exacerbated the affordability problem.  At the same time, policy makers have not stimulated the planning system to release sufficient land for housing construction, mainly due to the NIMBY (Not In My Back Yard) syndrome. In the meant time, the construction industry has shown much more readiness to speculate in order to accumulate, rather than increase construction efficiency, productivity and quality. None of this has stimulated housing supply greatly while housing affordability has declined.

Housing is a matter for each of the 28 nation states of the EU. Some countries, like Germany, build enough housing to meet the needs of their citizens whose quality of life is significantly improved by having sufficient, high quality, affordable homes to rent and/or buy (the recent refugee crisis could not have been planned for in advance. By definition, a surge of 1.1 million asylum seekers in 2015 was not part of the housing forecast). Others, like Britain, do not build enough housing. This is not because of insufficient land, EU freedom of movement of people or other handy excuses for systemic failures on the part of British politicians and their policies, the British planning system and the British construction industry. Any such interpretation amounts to the politics of scapegoating others for one’s own glaring failures and I, for one, will have no truck with it.

  • Is the EU responsible for the British housing crisis: The British housing crisis has been decades in the making. Strong EU immigration is a relatively recent phenomenon.
  • Is the British government responsible for the state of British housing: Its policies have focused almost entirely on housing ownership (tenure), rather than housing construction.
  • Should I vote to leave the EU because of the state of British housing: Britain alone is responsible for regulating demand and supply to deliver sufficient and affordable housing.

© Ricardo Pinto, 2016, AngloDeutsch™ Blog, www.AngloDeutsch.EU


The refugee backlash – pulling-up the European drawbridge

© Ricardo Pinto, 2016, AngloDeutsch™ Blog, www.AngloDeutsch.EU

2015 was another tumultuous year for Europe. Over a million refugees found their way into the European Union (EU), but already a new dynamic is evident in early 2016: the refugee backlash has begun and Europe is pulling-up the drawbridge on refugees and economic migrants. The broad contours of the dynamic evident can be summarised as follows:

  • The EU countries have accepted too many and cannot continue to absorb refugees at the same rate;
  • Germany was irresponsible in allowing so many refugees;
  • Without proper checks, the refugee will include a radical element that will pose a threat to the EU´s security, as illustrated by the terrifying Paris bombings in November 2015;
  • Once in Germany, or wherever, they will spread to other parts of the EU, so the freedom of movement of people principle may need to be looked at again;
  • Further sexual assaults on women and robberies by young men from “the African or North African region” are to be expected following the shameful New Year’s Eve experiences in Cologne, Hamburg and other cities;
  • The current levels of migration will destroy Europe as we know it; the borders must close, only legitimate applications up to a predetermined cap can be accepted and the rest sent back.

This all seems logical and it plays well as a populist theme. This certainly applies to parties such as the Alternative für Deutschland (AfD) in Germany and the UK Independence Party (UKIP), but it also goes down equally well with the mainstream political parties such as the Conservative Party in the UK and the CDU and especially CSU in Germany. This is without even mentioning the more radical right wing movements that exist throughout Europe. Not surprisingly, shrill criticism of the migration issue and the EU’s apparent inability to manage the situation is particularly evident in the UK, as it gears up for the forthcoming referendum (the exact date of which has not yet been announced) on whether to remain in the EU or not.

It is very difficult to unpack and analyse what is clearly a highly emotive theme, let alone have a sensible debate about it, which is the very reason why certain political parties are making hay with the refugee issue. Previously, their favourite theme was the Eurozone/Greece crisis, now it is migration but the overall gloom and doom narrative does not change very much.

I should stress that there are clearly legitimate public concerns throughout Europe about the migration issue, both within the EU and from outside. However, the use of scare tactics to gain political or other advantage is not something I enjoy witnessing so I aim to address a sub-set of issues, such as Germany’s alleged irresponsible behaviour, the argument that Europe simply cannot cope and the refugee backlash that is in full swing before the first month of 2016 is finished.

The blame game

I will start with Germany’s role in the European refugee crisis. There is certainly a messy situation, but did Germany act irresponsibly in 2015?

Any way you choose to cut it, Germany has played the key role in the refugee crisis. Germany accepted 1.1 million refugees in 2015, a number than could rise further on by the time the counting is official. Germany had in any case been experiencing significant flows of migrants, mainly from the EU. For the last few years this has been running at over 400,000 net migrants per year. Add this up and Germany received at least 1.5 million net migrants last year, which is an astonishing figure. Furthermore, under the German asylum law, refugees may be allowed to bring their family members, resulting in a significant and unquantifiable flow connected with 2015.

By any reasonable criteria Germany has been an incredibly good country to accept so many people. This is not just about the cost involved, which is undoubtedly significant albeit one which Germany is in a position to absorb. Being a good country is first and foremost about the willingness to recognise the human suffering cause by the migration crisis and to try to do something about it, rather than turning a blind eye to it all.

The contrast with many other EU countries could not be greater. Countries such as the UK have agreed to accept 5,000 Syrian refugees per year for the next five years. It has to be borne in mind that even this paltry number was only agreed to following a public outcry from British citizens appalled by their government’s hard heartedness, which bounced Parliament into agreeing to do more.

Germany is not alone in being a good country: about 90% of the refugees have been accepted by three countries out of 28 in the EU: Germany, Sweden and Austria. What about the response of the other 25 countries of the EU?  Following months of unedifying political squabbling, which continues to this day, the best they could come-up with was to agree to relocate 160,000 asylum seekers from Greece and Italy over the next two years: this is an average of 5,700 per country over two years, though very few of these transfers have actually occurred so far (less than 500 were achieved in 2015 and only 3 out of 10 “hot spots” have opened according to some estimates).

Is “pitiful” too strong a word to summarise the EU’s collective failure in the face of a mass humanitarian crisis? I don’t think so. It is not the first time that the EU has failed miserably to stand up to be counted and it will almost certainly not be the last. It is not as if the refugee crisis was some sudden, unexpected act of god; this is the result of steadily growing pressure and reaching its natural and inevitable conclusion. There was nothing about it that could not have been predicted by the civil servants of the European Commission or of the EU member states.

Germany’s decision to act more or less unilaterally in accepting 1.1 million refugees must be seen in the following context:

  1. This is the worst crisis since WW2: the number of forcibly displaced people, often due to wars, reached almost 60 million worldwide at the end of 2014, including over 14 million refugees. This was an increase of about 25% compared to the previous year and is mostly due civil war, violence and oppression in Syria, Eritrea, Afghanistan, Somalia, Iraq, etc. although other regions, including northern Africa and the Balkans, are also major sources of migrants (IMF, 2016 / The Refugee Surge in Europe: Economic Challenges). This is nothing short of a mass human tragedy, which Europe is neither immune to nor can afford to simply turn its back on. Globalisation entails many new developments, including the capacity of large numbers of people to move in the direction of Europe. It may take time, but sooner or later, it does reach Europe.
  2. This was not a crisis of Germany’s making: it did not chose to invade Iraq in 2003 and played little or no part in setting in chain a series of events which have destabilised parts of the Middle East, in an attempt to bring about democracy through regime change. Of all the European nations it is the UK, France and Italy (together with the USA) that bear the greatest responsibility for any resulting instability in the region. All are now conspicuous for their efforts to obfuscate causality and deny moral or other responsibility (if you break something, you should fix it) to deal with the resulting mess that they helped to set in chain.
  3. The EU failed spectacularly: the utter inability of the EU to find common ground in dealing with the huge volume of people heading towards Europe is what resulted in Germany’s more or less unilateral action. Just as in the Greek/Eurozone crises, it is proving extremely difficult for 28 countries to make decisions quickly and act in unison. This should not be in the least bit surprising. The EU is very far from being a United States of Europe; this simply reflects the fact that the nation-state is alive and well within the EU, despite exaggerated claims of its demise. Each nation retains the ability to follow its own mandate and block changes that it does not agree with. The Central European (Visegrad countries) and Western Balkans states have made their views crystal clear in respect to taking a share of the refugees, but they are not alone. Just as in the case of Greece and the Eurozone, finding a common solution to an unexpected large-scale problem is a slow, messy and costly process. In the end, to misquote slightly the famous words: Europeans Will Always Do the Right Thing — After Exhausting All the Alternatives. The 28 nation states plus the various Candidate Countries (i.e. Western Balkans including Turkey) will find an imperfect compromise and Germany will pay a disproportionate amount of the cost arising. Such is the iron rule of the EU. No other scenario is possible if 28+ nations are to continue to play broadly for the same team. How many other international agreements are you aware of that take a couple of weeks or months to resolve? Climate change agreements? International trade agreements? These things take years or decades, not weeks or months to sort out and are always and everywhere an uneasy compromise. 28+ countries finding a way to deal with the worst humanitarian crisis in 70 years takes time but in 2015, time was of the essence where people are involved, rather than just economics.

Cometh the hour, cometh the country: Germany chose not to sit on its hands but to act in alleviating the growing pressure along the Turkish-Greek-Balkan-Central European corridor.

Refugees in Miratovac, close to the border between Serbia and Macedonia. Photo by Djordje Savic / EPA

Refugees in Miratovac, close to the border between Serbia and Macedonia. Photo by Djordje Savic / EPA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

You are free to form your own opinion about whether Germany has acted irresponsibly or not. I personally think that not only has Germany acted incredibly responsibly, but as tax payer and resident of the country, I am proud of living in such a country. No doubt, Germany has already changed as a result and ordinary Germans are deeply unsettled about the implications, an issue which I plan to write about in the future. This is a reflection, among other issues of the fact that the scale of the problem is so great that no country can possibly solve it all on its own – not even Germany.

Europe Cannot Cope! Really?

The next issue is whether Germany and/or Europe have relevant experience and if they can absorb the numbers of refugees.

For a start, I can distinctly remember (since I was part of it) a small, poor, broken European country of 8.5 million absorbing about 1 million people from its former colonies during the mid- to late-1970s. While there are major differences with the current situation (common language, culture, religion, etc.), Portugal was not part of the EU but absorbed those numbers and did not collapse despite its politically chaotic and economically precarious post-colonial situation at the time. In fact, it thrived as a result of the influx. Don’t get me wrong: I am not suggesting that Europe should fling open its doors to all and sundry with no questions asked, but I am saying that Europe is much more robust than many would seem to believe.

After a short-lived spike of international approval for its decision to take on the refugees, Germany has since reaped criticism, direct and indirect, most of which has been leveled at Angela Merkel, the Germany Chancellor. The gist of the argument is that she has gambled Germany’s long term interests for personal hubris: she wanted to cap her career with a Nobel Peace Prize and/or improve Germany’s international image after the Greek crisis. Others of a more analytical bent sought instead to justify Germany’s actions (and presumably the inaction of their own governments) by pointing to Germany’s ageing population structure. It seems to me that almost all 28 EU countries are suffering from the same problem, albeit to varying degrees. Did others facing the same demographic situation jump to take their share of refugees? I don’t think so.

It is certainly true that Germany and many EU countries have a rapidly ageing population structure (fertility of around 1.5, which is below the replacement rate of 2.1) that would greatly benefit from significant immigration of the scale that happened during 2015. But I take issue with the implication that the German authorities naively failed to foresee the likely stresses and strains that would be generated by taking so many refugees in one year (the estimate at the time was 800,000 – 1 million refugees). The reality is that Europe generally and Germany specifically have plenty of experience of large scale refugee crises and indeed of Muslims culture.

Firstly, Germany has a large number of Muslims. According to the 2011 Population Census, there are just under 6.2 million foreigners in Germany and Turks alone accounted for the largest group (1.5 million people or 24.4%). In all, some 2.5 million people are of Turkish origin. It is not as though Germany is not aware of the stresses and strains associated with the religion, gender, education, labour market and other dimensions connected with integrating populations, including Muslims. The same applies to many countries of the EU but unlike others, it still went ahead with what is often described by its critics as its “open door” policy.

Secondly, it was not so long ago that Germany had to respond to a refugee crisis of similar proportion. During the 1990s, a large number of asylum applications were lodged due to crisis in the ex-Yugoslavia, though the peak of that crisis in 1991 (around 700,000) has been exceeded in 2015 (see first Figure below). That said the second Figure below illustrates the point that the numbers were relatively low compared to those of the 1990s, though the diagram does not take the 2015 influx of over a million refugees into consideration. It is probably not a coincidence that then, as now, Germany absorbed the lion’s share of refugees.


IMF graphic 2016

Source: IMF, 2016, p.11

Thirdly, to put things in context, Europe had only absorbed 1 out of the 14 million refuges worldwide in 2014 and this increased to 2 million in 2015. Whoever believes that what has happened in 2015 is the end of the matter and that the EU can simply put-up the fences, close the borders and turn its back on the rest of the world is deluded. A proportion of the 12 million other displaced people are heading our way in 2016 and beyond: the current estimate is that another 1 million will aim for the EU this year and possibly more. The way to end this catastrophe is not by pulling-up the drawbridge to Fortress Europe; if the conflicts in the countries in question are ended and if this is combined with a major reconstruction programme, in time, the human tragedy and the migratory process will also abate. Putting-up fences and closing borders will restrict some of the flow, but will also add to the human desperation without actually dealing with the root cause.

To conclude, in my view Germany did not saunter into the current situation blithely and Mrs Merkel was right in saying “Wir schaffen das.” We can do it: I agree with her. Other, much smaller and poorer countries have in the part or are currently absorbing the same or higher numbers of refugees. Germany knew, more or less, the implications of opening its borders to about a million refugees, even if the general public could not have predicted the exact consequences, including the outrages in Cologne and other cities. It is most unlikely that Europe’s pre-eminent politician would not have sniffed the potential political, social, religious and cultural implications of undertaking such a radical step. The numbers absorbed by Europe are relatively small by comparison with the numbers being absorbed by other countries, including Turkey. If they can do it, so can Europe. Indeed, a cursory reading of European history proves that it has coped with wave after wave of migration.

Refugee backlash

To ask if the refugee backlash is coming would be to pose the wrong question: it is already here.

The mood in Germany and the rest of Europe started turning ugly long before the Paris terrorist attacks and the mass sexual and other crimes in Cologne and other German cities during the New Year’s Eve celebrations that went wrong. Pensioners are up in arms about the way they perceive their country is changing. Parents are concerned about their children’s education as gymnasia are requisitioned as temporary accommodation and class rooms begin to take the strain of absorbing the influx of non-German speakers. House prices and rent levels are being pushed up in an overheating housing market where affordable accommodation is scarce.  Region and local authorities remain deeply concerned about practical matters in addition to shelter, such as state benefits and labour market opportunities for refugees. The issue of integration and whether it is possible to achieve or not, is “the” topic of conversation. This applies to Germany and it applies equally to other EU countries.

Angela Merkel has gone from being Europe’s pre-eminent politician and practically politically unassailable in Germany, to being under siege. Make no mistake about it; she is fighting for her political future.  Yet despite the ratcheting of pressure, even today, she is refusing to put a cap of the number of refugees that will be accepted by Germany in future (the CSU is openly advocating a cap of 200,000 per annum, which itself puts the UK’s response in the shade). There are probably two reasons for this. Firstly, German asylum law is based on individual assessments so caps would not be workable without changing the law (but we know laws can be changed at the drop of a political hat). Secondly, the huge numbers of forcibly displaced people out there (14 million and counting) are desperate and there is no end to their travails in prospect. What would you do in their shoes? Which safe harbour would you try to reach, possibly at the cost of perishing on the way? A cap would be a meaningless promise without a workable EU arrangement.

Mrs Merkel is displaying the hallmark of true leadership: political courage and acknowledging moral duties beyond her nation’s borders. That is the essence of being responsible in a European and global sense, though I recognise fully that many would much rather put national and personal interest before anything else, including in Germany.

Merkel probably expected the rest of Europe, especially the largest countries, most of which have had more than a hand in the unfolding disaster in the Middle East, to take a much greater share of the humanitarian burden. Despite the lessons of Greece, she has miscalculated in relation to most of the EU and is now in the middle of the biggest political crisis that she has ever faced. She also appears to have greatly overestimated the Greek and Turkish capacity to manage their borders.

But she is nothing if not a pragmatic leader. She has recognised that the whirlwind is not just gathering, it is already blowing. A change has already been signaled that 2016 will not be the same as 2015. The scale of the challenge means that Germany cannot shoulder the burden mostly on its own for much longer. All three of the most generous countries have introduced border visa checks (three others have also and many more are threatening to do the same). A closure of national borders has so far been resisted by the EU, but this could change. Sweden has announced that 80,000 of the 160,000 refugees it accepted will be sent back because they are economic migrants, not refugees. The EU has reinforced the message by stating that 60% of the applicants are not refugees at all but economic migrants mainly from the Balkans and North African countries such as Morocco and Tunisia. It has also threatened to suspend Greece from Schengen for systematic failures in the migrant crisis. In turn Greece is pointing its finger at Turkey for allowing migrants to “swamp” their border and islands.  Reports are piling up that in addition to anti-refugee demonstrations and hostels being set on fire in Germany, violence is erupting in Sweden and other countries.

A common EU approach is the only way forward, combined with a serious and concerted effort to end the conflicts and reconstruct economies, since these are the drivers of mass population displacement. But just like the Greek and Eurozone crises, which are also far from over, it will not happen miraculously or overnight.

So, get ready for a much more hard-nosed European approach to the refugee crisis, with an emphasis on only accepting people from conflict zones (true refugees and asylum seekers) and rejecting all others (i.e. economic migrants). The EU drawbridge is being pulled-up. The wider societal backlash is already underway and those that are leading it will not be pausing to distinguish those that deserve to be helped from those that do not.


German Flags are Fluttering in Britain – Kloppmania in Liverpool

© Ricardo Pinto, 2015, AngloDeutsch™ Blog, www.AngloDeutsch.EU

It’s not that common to see a Union Jack flag fluttering on British soil, except where the royal family is concerned. Seeing a European Union (EU) flag is as rare as spotting a dodo. But a seeing a German flag on British soil is something that I never thought I would witness, but that is exactly what happened yesterday. So what is the cause of this unexpected event? Is it the Brits getting the German reunification celebrations wrong by a few weeks? Is it perhaps celebrating the fact that Germany is doing them a favour by giving refuge to probably over 1 million refugees and asylum seekers to Britain’s 20,000 spread over five years? No, it is “Kloppmania”. Let me explain.

October 17, 2015 AFP PHOTO IAN KINGTON

October 17, 2015 AFP PHOTO IAN KINGTON

 

 

 

 

 

 

 

 

 

I have been a fan of Liverpool Football Club (LFC) since I first came to England in 1977. That was the year that Kevin Keegan left Liverpool for Hamburg SV, sparking off the German club’s revival and winning the Bundesliga in the 1978–79 season for the first time in nineteen years. But it was also the year when he was replaced by an even better player, namely Kenny Dalglish or simply King Kenny, as he is affectionately known at the club. They played glorious football, resulting in LFC retaining the European Cup and winning the European Super Cup (by beating a HSV team including Keegan). Domestically, they were runners-up in the league (to Nottingham Forest) and the Football League Cup. The team went on be the dominant team in England and in Europe, winning 5 of the titles in 1970s and six in the 1980s, as well as collecting 4 European Cups (now Champion’s League) along the way. However, the last league title was in the 1989-90 season, prior to the establishment of the Premier League. All good things come to an end and it has certainly been downhill more or less all the way since. Liverpool has not won the league titles for 25 years: a quarter of a decade!

Seven managers have come and gone in that time. Several have come close to winning the premier league (runners-up 4 times since 1989-90), most recently in the 2013-14, when the club played uninhibited, exhilarating, swashbuckling football, reminiscent of the dim and distant heyday. However, it was yet another false dawn and since the bitter disappointment of being runners-up there has been a season and a bit where all the hopes and aspirations of the fans have been crushed to the point where they could no longer recognise the team or the tactics.

Liverpool is a proud and historic city, but de-industrialisation has done it few favours. Reflecting the football, the city has experienced a period of decline. It may be one the poorest cities in the UK but it remains solidly working class the fans are as committed, vocal and passionate as ever, perhaps expressed most vividly in their support for the red half of the city (the other team, Everton, is the blue part) when they sing “You’ll never Walk Alone” (YNWA). They understand the game and expect their players to be committed and brave on the ball and to play in the Liverpool way. Intense is the word that best describes the cauldron of football called Anfield. The lack of fighting spirit against any team, especially fierce rivals such as Manchester Unite, is the single most unforgivable thing about recent performances, reflecting poorly on both the players and manager.

Not surprisingly, there was a growing wave of discontent in the stands, including regular booing their own team (but not the manager out of respect) in the last few games, and growing criticism in the media which features a remarkably large number of  ex-Liverpool pundits. The manager had to go – after all, they can hardly fire the whole team – and this is exactly what happened over a week ago. Although not exactly unexpected, it was still a shock the fans, the majority of whom are known for their loyalty to the club through thick and thin.

From the beginning there were two managers in the running according to the media, namely Carlo Ancelotti (ex-Real Madrid among a long list of top clubs) and Jürgen Klopp (ex-Dortmund and Mainz 05). Both are highly successful A-List managers, but the truth be told, I believe I was among the vast majority of fans (over 90% in my estimate) who could quite believe that either one would be appointed for three main reasons:

  • The club is no longer among the wealthiest in the country (5th after Manchester United, Chelsea, Arsenal and Manchester City) and cannot afford so-called “world class” players, unlike its rivals;
  • The club has not been regularly in the Champion’s League since the last, brief period of glory (winner in 2005 and runner-up in 2007) unlike many other equally illustrious clubs;
  • The burden of history of last winning the league 25 years ago, combined with the sheer scale of challenge involved in clawing up the league table and regaining the long-lost lustre does not appeal to many managers.

Wrong, double wrong and I am very happy to admit it.

I was flabbergasted and yet hugely excited when it became increasingly apparent that we would get Jürgen Klopp as our next manager, with him being unveiled by the club on 16 October 2015. Klopp’s decision to choose Liverpool over any of the leading clubs in the world, has galvanised the red half of the city, though I dare say many of the blue side (Everton FC supporters) are also secretly glad if not proud that he has chosen to come to their part of the NW (as opposed to Manchester) or London.

Now leaving aside the royal family, although there is respect, Germans are not generally held in high esteem in the UK. It is not simply a matter of two wars (which should not be underestimated, even today), it is the strongly held stereotypes which hold that Germans are unexciting and lack a sense of humour. None of this applied for a second to Klopp or “Kloppo” as he is affectionately known by fans. A little bit of research reveals a few consistent facts about the man, which goes to the heart of why football fans take to him and not just in Germany:

  • He is loyal: he is a one club ex-football player (Mainz 05), has managed two clubs (Mainz 05 and Dortmund), each for 7 years. This is increasingly an endangered species in football and one that fans automatically respect, not just Liverpool fans;
  • He gets working class clubs: Mainz, Dortmund and Liverpool have three things in common; all have a working class history, passionate fans whose “anthem” is YNWA and, of course, Klopp himself. He is clearly attracted by the passion and intensity of the fans and is something they take to him like a duck to water;
  • He is larger than life: not only is he is a tall and handsome fella, he has a semi-permanent wide grin and is extremely charismatic. He has his own style and is neither afraid to express his emotions or his opinions. This is something that all fans automatically connect with – managers who sit stony faced, take reams of notes or put up umbrellas are the opposite;
  • He excites all fans: he has his own variant of tactics, most clearly expressed in the hard running (counter pressing or “gegenpressing”) but it is intense, it is emotional and it is exciting football: it is dynamic football and fans all over the world can automatically relate to it. Unlike other managers who talk incessantly about their “philosophy”, Klopp’s approach can be boiled down to this: “So that’s it, it’s very emotional, very fast, very strong, not boring, no chess. Of course tactical, but tactical with big heart. Tactical things are so important, you cannot win without tactics, but the emotion makes the difference. Life in our game, that’s important.” This in turn can be reduced to two words which cannot be mistaken by any fan, regardless of language, culture or tradition: “full throttle” or “heavy metal” football is what is promised and I for one will gladly take that;
  • He knows there is no instant success: he has clearly not selected Liverpool because of mere romanticism, though this is undoubtedly a factor. Klopp has stressed that this was the only club that he has discussed, that he has come because of the players and that it will take time to achieve success with a team such as Liverpool. He says this often with memorable throw away one-liners such as: “I’m here to put things right at Liverpool FC – but don’t think I’m Jesus.” It is not by accident that there was an instant emotional connection. Elements of the great Bill Shankly, who set the club on its path to success, are evident. The world has come to admire the achievements of Dortmund over the German football colossus that is otherwise known as Bayern München. Under Klopp, Dortmund punched above its financial weight and reaped global acclaim for its approach in developing players rather than paying top dollar for ready-made talent. In this context, it struck a chord with the fans when Klopp said that everyone at Liverpool FC had to turn from “doubters to believers.”
  • He is not purely motivated by money: he will earn up to GBP 7 million per annum after bonuses. That is double what his predecessor earned, but he is by no means the best paid in Britain and could have earned more, if that was his sole motivation. Instead, he has accepted one of the biggest challenges in word football. To revive a team (and in the process, the city) with its fading glory and deep yearning for success in a major undertaking, compared to merely fine-tuning a well-oiled elite club with matching finances. This type of challenge is not what 99% of managers out there would go for. The level of expectation connected with such a task has crushed many before him and may well do the same to him (he is well awareness of the club’s history and has likened the weight of the past to carrying it around “like a 20 kg backpack”). He has clearly made his own calculation and let his heart as well as his head rule his decision, rather than the easy option or the bank account.

So what is the outcome?

It is that quite simply, he has gripped the city in “Kloppmania”, but he has excited everyone connected with football too. It is clear that if he is successful with his methods in Liverpool, it will impact the rest of the game and may change the tactics deployed in the UK. That prospect excites all fans. If he is able to change the money game where success if closely correlated with expenditure, as he successfully did at Dortmund, then he will not only affect Liverpool, he will galvanise all other clubs (apart from Man United, Man City and Chelsea) in the Premier League. In the process, he will also give hope to fans all over the world. The reset button will be pressed and the prevailing (largely accurate) view that money buys success on the field will be less dominant and football will get a shot in the arm.

So, it is not surprising that Kloppmania has taken over Liverpool in particular, though the effect is wider in my view, with many other fans hoping that Klopp achieves successful in England. Ex-Manchester United players and pundits such as Gary Neville are already urging caution about the runaway Kloppmania in Liverpool. To some extent, leaving footballing biases to one aside, ne is right to caution us. The first game yesterday showed that Klopp is no magician and certainly no Messiah. After 2 days of training his full squad and having to contend with a long injury list along his leading players, Liverpool played its first game against a team on top form and salvaged a draw against Tottenham Hotspurs. No win, but this team ran more, pressed more intensely, played more freely and defended much better than in three years; there are no complaints from Liverpool fans. We know we are back on the tight track. We feel that Klopp has the knowledge, experience and charisma to make our team better, more exciting and more successful. It is only a matter of time, which of course, is the very commodity which is increasingly disappearing from football.

We may have to wait a lot longer than 25 years to win the Premier League again, but at least we are free to dream once again. So pull out those German flags, wave them proudly and “Walk on, with hope in your heart.”


Elitism in Britain and Germany

© Ricardo Pinto, 2015, AngloDeutsch™ Blog, www.AngloDeutsch.EU

There has been a lot of discussion about elitism, the Establishment, the 1%, etc., partly driven by the seminal work on wealth and income inequality by the French economist Thomas Piketty (see Capital in the Twenty-First Century). This has been exacerbated recently by the on-going discussion about David Cameron and his Oxford days, including allegations about some of the initiation rituals involved (see #piggate). This post examines elitism in Britain and Germany by analysing the people who make-up the Cabinets in both governments, as a means of establishing the extent to which they form part of elite or not.

First it is important to be clear what we are referring to when we talk about the elite or the Establishment, as illustrated in the box below.

Elite

1. The choice or best of anything considered collectively, as of a group or class of persons.

2. Persons of the highest class: only the elite were there.

3. A group of persons exercising the major share of authority or influence within a larger group: the power elite of a major political party.

4. Representing the most choice or select; best: an elite group of authors.

(the) Establishment

1. The existing power structure in society; the dominant groups in society and their customs or institutions; institutional authority (usually preceded by the): the Establishment believes exploring outer space is worth any tax money spent.

2. The dominant group in a field of endeavour, organisation, etc.: the literary Establishment.

Source: Dictionary.com

 

The elite is thus a small group of people who control a disproportionate amount of wealth and/or power. It is not easy to ascertain people´s wealth but there are surrogates that can be used for privilege and power. The Prime Minister and the rest of the Cabinet are generally considered to be the single most powerful group of people in any nation. Therefore, in assessing the elites and the Establishment, it makes sense to begin with this particular group of people.

In assessing the issue of whether the people concerned are part of the elite / the Establishment / the 1%, I look at two indicators for which information is relatively objective and easily available:

  • Whether they were privately/independently educated in the form of a fee paying school education or not: Britain has a well-established tradition of independent, fee paying schools. Germany too has such schools though their origins and emphasis are different. In both countries the state school system is free but some choose to educate their children privately. Since these involve significant costs compared with state schools, it is generally the privileged that tend to attend such schools. In the case of the UK, 7% of the students go to such schools compared with 6% in Germany;
  • Whether they attended the elite (two top) universities in their respective country or not: in the case of Britain, this would be Oxford University and Cambridge University, often conflated as “Oxbridge.” In the case of Germany, only a couple of universities make it into the top 50 universities in the world, namely Heidelberg’s Ruprecht-Karls-University and Munich’s Ludwig-Maximilians-University. The barriers to attending the elite universities are normally much higher than the rest but the rewards associated with graduating from the top two universities are also disproportionate (the subject of the next post).

It goes without saying that those lucky enough to have both attended a private school and graduated from the top two universities of their respective country are bound to be rewarded with disproportionately higher life-chances compared with their fellow citizen without the benefit of such privileges.

In this post, I explore the issue using official information provided by the respective governments, supplemented with research on cabinet members who are coy about their educational background. The results of the analysis for Britain and Germany are presented in the Table below.

Table 1. Educational Background of the Cabinet in the UK and Germany (2015)

Cabinet_table

Note: the private/independent schools are as easy to identify in Germany as in Britain. Furthermore, it is not always possible to match-up government ministries / departments in the two countries. Sources: www.gov.ukwww.bundesregierung.eu and Wikipedia

So what does the above table tell us about the UK and Germany, based on the educational background of their respective cabinets?

  • Independent school: 9/21 UK vs 1/16 Germany: 42.8% of the UK cabinet attended independent schools compared with only 6.2% in Germany. There is an incredibly high level of concentration in the UK, given that only 7% of the adult population attends independent schools. The German cabinet simply reflects the national trend of 6% of pupils attending such schools;
  • Top 2 universities: 13/21 UK vs 1/16 Germany: an even greater proportion (61.9%) of the UK cabinet attended Britain´s top two universities. To put this in context, only 1% of the adult population of Britain attended Oxbridge. This also contrasts with only 6.2% of the cabinet in Germany attending its top two universities. An astounding 38% of the British cabinet attended Oxford alone. If you think this is something new or specific to the Conservative party, you’d be wrong; it is merely a matter of degree. Ed Miliband, Gordon Brown and Tony Blair are all Oxbridge educated, as were 12 of Ed Miliband’s shadow cabinet. Jeremy Corbyn, the new leader of the Labour party, was educated in an independent school but did not complete his higher education;
  • Independent school and top 2 universities: 9/21 UK : 0/16 Germany: whereas none of the German cabinet were privately educated and went to the country’s top two universities, a staggering 42.8% of their British counterparts did, David Cameron and George Osborne included, thus being doubly privileged.

Based on the indicators of private / independent education and/or attending Oxbridge, as well as being a member of the Cabinet, the elite or the Establishment is very much alive and in rude health in Britain. Independently educated pupils, especially those from the elite schools, disproportionately go to Oxbridge (taking 44% of the places at Oxford and 38% at Cambridge) and end-up in the Cabinet. Coincidence is not the main factor at play; layer upon layer of privilege and entitlement piled upon each other is closer to the truth.

By contrast, the German cabinet is positively plebeian. I shall leave it to the reader to determine which they prefer and why.

The recent and totally unexpected election of Jeremy Corbyn as the Leader of the Labour Party (who has not exactly grown-up in the proverbial social housing estate or attended an inner city state school) appears to be partly a reaction to the “more of the same” politics by the ruling elites. No such trend is evident in Germany.


I found refuge in the EU. You helped me. Now, let’s help the others.

© Ricardo Pinto, 2015, AngloDeutsch™ Blog, www.AngloDeutsch.EU

The Grexit crisis has blown hot and cold many times in recent years and will continue to do so for the foreseeable future. However, by common agreement, there is now an even greater crisis affecting the European Union (EU) and its future, namely the current refugee and asylum seeker crisis. It is not about economic migration; it is a humanitarian crisis.

A Refugee Crisis of Mega Proportions

I have been commenting on the issue of migration on the AngloDeutsch.EU Blog so I cannot but discuss this crisis of mega proportions. I would like to briefly summarize the points of the current situation before presenting a personal perspective below:

  • There is a variety of different types of migrants. The two main categories are “asylum seekers / refugees” who are fleeing something which makes them fear for their lives/safety and “economic migrants” who are seeking a better life for themselves and their families;
  • The difference is fundamental. Each EU member state makes its own decisions in relation to the issue of asylum seekers/refugees within the framework of broad international agreements which appear to be difficult or impossible to enforce. The same applies to economic migrants from outside the EU. Within the EU, a fundamental principle is that of “freedom of movement” of capital, goods, services and people. Consequently, there is no restriction of migration within the EU, except for recently joining countries, such as Croatia. Restrictions remain during a „transition“ period for some countries such as the UK, but other, such as Germany, have chosen to abolish such restrictions even before the transition period lapses;
  • Many politicians and some mainstream media, especially those with an ax to grind, deliberately or otherwise, lump the refugees/asylum seekers, economic migrants and freedom of movement into one giant, emotive issue: this is spurious, confusing and contributes to a heated debate in the EU and elsewhere. In an atmosphere of anxiety about migration in general, this is not helpful;
  • Most EU citizens, British and Germans included, make a clear distinction between economic migrants (there is concern about the level of migration in some countries) and genuine refugees / asylum seekers, where there is generally a good deal of sympathy;
  • The current levels of refugees / asylum seekers must be put into context: it is the highest level since World War II and is the direct result of various conflicts in Africa and the Middle East, not least in Syria, Afghanistan, Eritrea, Iraq, Somalia, etc. This is first and foremost a humanitarian crisis. For the first time since World War II, there are more than 50 million refugees, asylum-seekers and internally displaced people worldwide;
  • Some of the people joining this wave of desperate humanity are taking advantage of the situation. Having worked in Albania, Kosovo, Serbia, etc., all of which are making strides to join the EU, there is little doubt that the vast majority of these applicants are being opportunistic. If this sort of thing is allowed to continue, it may discredit the overall refugees/asylum situation and undermine the willingness to help others;
  • The latest development, since this blog focuses mainly on Britain and Germany, is that the German government has issued what is nothing less than an unprecedented commitment of take in at least 800,000 and possibly a million refugees/asylum seekers this year, not counting other forms of migration, which has been running at very high levels in recent years. By contrast Britain has taken 5,000 Syrians since 2011 and there is a major political debate about whether a target of 10,000 refugees / asylum seekers would be acceptable. The British government, under increasing pressure from ordinary citizens, has just announced that it will accept 20,000 refugees/asylum seekers over five-years (4,000 per year);
  • The main political explanations for this imbalance is that one (Germany) has a shrinking population and therefore needs to take in people but that the other (UK) is an overcrowded island that cannot absorb any more than are already coming in. There is a prominent political view that taking in refugees would not solve the problems in the relevant countries and would simply encourage even larger numbers to come to the EU;

It is up to each person to reflect on whether their respective governments’ policies are appropriate in the face of this human catastrophe, bearing in mind the costs involved as well as the potential knock-on effects on social, health, housing and other services, including the downstream integration issues. There will certainly be implications in the short-, medium- and long-term, since most refugees/asylum seekers that are accepted are likely to remain, even when the crisis is over.

A personal perspective

In the rest of this post, for a change, I shall not focus on the definitions, statistics and policy responses, etc. but the human element using my own migration experiences and those of my family. The point has been reached in this humanitarian crisis where everyone must pin their colours to the mast.

I was born in Mozambique. When I was nine years old, the civil war that quickly followed the war of independence reached stage where by parents finally decided that they had no choice but to abandon the country. There were a series of issues leading to this decision, but the straw that broke the camel´s back was a bomb that blew out the windows in the surrounding buildings. Fear for our safety, combined with a sense of growing injustice, led to a decision to leave everything behind, except for our lives and the clothes on our back. This is the “refugee / asylum seeker drive“ and it is this which is at the bottom of the crisis we are witnessing.

By the time I was 11, my parents had decided that living in Portugal was not for them and that they preferred to leave for the UK, where they felt they could rebuild their lives and offer their children better prospects. This is the „economic migration“ drive, which I shall leave for another day. My family and I have experience of both the “push” drive to get out of a country, as well as the “pull” element of a prosperous country like the UK (Portugal was not a EU member in 1977). As such, I can sympathize with the stream of people heading towards the EU.

Each of these families seeking the safety of Europe will have their own catalyst, but they are generally similar: fear of safety/life/well-being reaches a point where the extremely high barriers to leaving are overcome. Those barriers include family and friends (you leave the people you grew up with behind, probably for ever), possessions (home, furniture, mementos of life, etc.) and communities, traditions and all the other things that make-up everyday life. Only the bare minimum can be taken: people, clothes, food and money.

The decision amounts to rolling the dice that will determine their fate. They know that they may be turned back at any of numerous borders. They are only too aware that they will experience all sorts of privations. They come to terms the stark fact they or members of their family may perish on the way. Yet they are determined to head for Europe and more specifically the EU. Most will do what they are allowed to do, not least where women and children are involved. Some, especially single young men, may do whatever it takes to reach their goal, as the scenes in and around the Channel Tunnel prove.

But even if their drive, courage and determination (for that is exactly what is involved) is rewarded with success and they end-up in the EU and preferably in countries with the resources to successfully absorb them, they also know that it may all be in vain. After all, there is a high chance of being put on an aeroplane and sent home sooner or later, once the crisis is over.

And still they roll the dice, often taking their young children on this incredibly arduous and sometimes lethal journey. Imagine this, if you will, and reflect on what it would take for you to reach such momentous life and death decisions. I ask you:

  • Would you take these sorts of decisions without a very good reason?
  • Are the people who manage to reach Europe´s shores worthy of sanctuary?
  • And if so, are such people likely to have the drive to integrate and thrive in the EU?

Follow your instinct. Form your own opinion.

I am not just a migrant to the EU, I am a serial migrant within the EU. This is not a source of shame. On the contrary, it is a source of great pride which has given meaning to my life. Every country I have lived in had enriched me and, for my part, I have contributed to every country I have had the good fortune to experience. Migration has been and remains a constant feature of humanity.

There may be some seeking to reach the borders of the EU purely for economic reasons, rather than being driven by misfortune not of their own making. It is not so easy to separate out the genuine cases from the bogus ones. But the sheer scale of the crisis, the types of people involved and the risks that they are taking demonstrate that these are, in the main, fellow human beings in desperate need of our help. For them the EU is a beacon for all the things that we take for granted. There can and there will be a win-win situation for them and for the countries taking them in. Europe has absorbed countless waves of immigration in the past and benefited from them; it will continue to do so in the future.

Let us be humane and thereby reaffirm the fundamental values that EU countries are right to be proud of. You helped me. Now, let’s help the others.


#ThisIsaCoup´s Germany Bashing is “Over the Top”

Quite a few people have taken to twitter under hashtag #ThisIsACoup to air their view that Greece has been bullied and coerced into an unjust and undemocratic agreement by the other Eurozone members, with the finger being pointing directly at Germany.

#ThisIsNOTaCoup

At least part of the reason for the popularity of hashtag #ThisIsACoup is that prominent commentators such as Paul Krugman, the Nobel-winning economist, have helped to legitimise it and propel the hashtag #ThisIsACoup to the global audience. Krugman wrote in his New York Times blog“The trending hashtag #ThisIsACoup is exactly right.” This was part of his campaign to encourage Greece to exit the Euro.

 I have shown that hashtag #ThisIsACoup is exactly wrong and on two counts. Firstly, “this is a coup” literally implies a great compliment to the Eurozone countries (a coup), which Krugman and the rest presumably did not mean. What they actually meant is hashtag #ThisIsACoupD’état. But here too they have got it completely wrong because the bailout agreement on offer has none of the defining characteristics of a coup d’état either.

I am not arguing that the Euro summit agreement is all fine and well. It most certainly is not and makes unrealistic demands of Greece given the almost non-existing willingness or capacity to reform. I am simply saying that referring to it as a coup d’état (or indeed comparing the agreement terms to the Versailles Treaty, which some commentators have taken to doing) is emotional claptrap directed at one country rather than the 19 that signed the agreement, Greece included.

 #ButItCertainlyISGermanyBashing

In this post I would like address the content being posted on hashtag #ThisIsACoup. This particular bandwagon is not only ill-informed but it is deteriorating into a full-on Germany bashing movement.

Have a look at a selection of photos on offer to get the general gist of what is going on.

Germany Bashing 1

This is a sub-set of the kinds of images being posted. Some of them are funny but the vast majority are simply misleading or spiteful. The tweets are laced with references to Nazism, Fourth Reich and other stuffpointing towards Germany´s true intentions, namely of subjugating Europe through the back door.

Which planet have these people been living on since 1945?

Germans are entitled to feel offended by what is going on. Make no mistake: this is not restricted to the Twittersphere. A reading of comments posted in many national newspaper articles relating to the Eurozone crisis reveals a rising level of enmity towards Germany and its supposedly true intentions towards Europe via the mechanism of the Euro.

As a Briton living and working in Germany, with a German family, friends, family and colleagues, I find this sort of thing, often under the guise of “humour”, unacceptable.

This is unfair. It is wrong. This is  Germany bashing.

If it has not yet been understood those in question, please reflect on the unequivocal fact that that vast majority of Germans would never have opted for the Euro if they had been given a choice and would gladly return to their beloved Deutschmark tomorrow if they could. The Greek tragicomedy is only adding fuel to this particular fire. But I guess whatever I say will never not cut much ice with some people.

Debt relief has already happened and will continue to happen

Now, having got that off my chest, I would like to turn to the rest of Paul Krugman´s quotation, since it appears to legitimise much of what is going on in hashtag #ThisIsACoup namely: “This goes beyond harsh into pure vindictiveness, complete destruction of national sovereignty, and no hope of relief.”

I would like to start with the end bit: no hope of relief. It must be noted that Krugman wrote this before the finalisation of the bailout negotiations, so he was not aware of the fact that, for the first time publicly, “hope of relief” has been finessed into the agreement (“… including financing needs, debt sustainability and possible bridge financing.”). We all know there is no such thing as money for nothing; and so do the Greeks. Incidentally, Krugman also fails to acknowledge that there has already been very significant debt reduction in the first two bailouts for Greece. There will almost certainly be further debt reductions in the third bailout.

As for the final part of the quotation, “This goes beyond harsh into pure vindictiveness,” I suggest that the Nobel laureate actually looks are the terms of the bailout to justify his view. I do not see it, thought I do agree that many of the things in the Euro summit agreement will never be realised, just as they were barely realised in the first two bailouts and/or were reversed once Syriza assumed power.

Germany Bashing 2National sovereignty is a 19-way street

The “complete destruction of national sovereignty” part is a red herring. In a representative democracy, the Greeks elect their government and their government makes decisions in relation to spending, taxation, etc. Parliament does not have to agree to anything it does not wish to do. In the meantime, the Greek Parliament has voted to accept the draft agreement. Two general elections and multiple Parliamentary votes later, the Greek government continues to ratify bailout conditionality. The debate about national sovereignty cannot be about Greece and Greece only. In the Eurozone there are another 18 nations whose taxes are increased and/or expenditure is potentially curtailed as a result of bailout after bailout to help Greece get its own house in order. There is a duty and responsibility towards the sovereignty of 19 nations, not only one.

If a country runs out of money through its own actions and inactions and needs to get it from another 18 countries with no end in sight, then then that country can expect reforms. But remember, these are the things which everyone agrees (including the Greeks themselves) it has systematically avoided doing for decades. Ask other states that have gone broke (but do not have the benefit of a Eurozone sugar daddy) whether they have had to implement painful reforms or not and for how long they have had to do it for in order to get back to normalcy.

Greece is under tremendous pressure to accept the bailout and some of the conditionality is questionable, such as connected with the privatisation fund. This reflects the lack of progress made in the other two bailouts as well as the breakdown in trust as a result of the negotiation tactics deployed in the last six months, rather than pure vindictiveness. At the end of the day, Tsipras and the Greek government must decide what, on balance makes most sense for their country. If the conditionality is vindictive and humiliating, there is an obvious option for them. If the future is truly brighter outside the Euro then it is the duty and responsibility of the Greek Parliament to go in the direction advocated by Krugman and others. But this is something which they have steadfastly refused to do so far to many economists´ dismay and disbelief.

As an aside, Paul Krugman is reported to have said that in pushing for a Greek exit he may have “overestimated the competence of the Greek government” and that it didn’t even occur to him that Greece would make a stand against the rest of the Eurozone countries without having made a plan for an exit from the euro if things went wrong. Perhaps he will also come to agree that the latest bailout agreement may be better than the alternative after all.

He who pays the piper calls the tune

At the end of the day, the country which makes by far the biggest contribution to the bailouts and thus potentially incurs by far the greatest loss associated with the Greek bailouts is entitled to not just a vote but to a significant say in the matter. Failure to do so would be irresponsible in relation to its own tax payers and a failure in democracy vis-a-vis its own electorate.

Every country must look after its own national interests. Consider Britain steadfastly refusing to contribute a penny to the Euro bailouts but offering to show solidarity towards Greece in the form of “humanitarian and medical aid,” should the country choose to exit the Euro and default. Britain is doing what it considers acceptable to its own electorate, as are all 19 Eurozone countries. What about Greece? Its approach is the epitome of following its own national interests. Why not Germany?

Get real: Greece´s sovereignty is not the only one in question; 19 countries are affected by the crisis. As the biggest contributor, Germany is entitled to a significant voice in the decision making-process (just as Italy, France, etc. and the Troika/Institutions are – but Britain is not). Some may not like it, but that is the reality.

Grow up: WWII ended 70 years ago; there comes a point when it is just plain silly to keep rolling out the tired old war clichés.

Stop the “over the top” (pun intended) Germany bashing.

 


If #ThisIsACoup then #MoneyGrowsOnTrees

© Ricardo Pinto, 2015, AngloDeutsch™ Blog, www.AngloDeutsch.EU

It seems as if a great number of people, and not just in the Eurozone and the European Union (EU); have taken to Twitter to express their view that Greece has been bullied and coerced into an unjust and undemocratic agreement by the other Eurozone members and by Germany in particular.

Prominent bloggers and commentators such as Paul Krugman, the Nobel-winning economist, have helped to legitimate and propel the hashtag #ThisIsACoup to the global audience. He wrote in his New York Times blog that:

“The trending hashtag #ThisIsACoup is exactly right. This goes beyond harsh into pure vindictiveness, complete destruction of national sovereignty, and no hope of relief.”

Partly as a result, the hashtag #ThisIsACoup, was trending in Greece, France, Germany, Britain and indeed globally as Twitters claimed that Greece was being stripped of its sovereignty as illustrated below.

#ThisIsACoupGLobalTrend

 

 

 

 

 

 

 

 

 

 

 

So it is worth examining what the hashtag #ThisIsACoup really means.

There are two meanings of the word “coup” according to Dictionary.com, with a third connected with the word:

  1. a highly successful, unexpected stroke, act, or move; a clever action or accomplishment.
  2. (among the Plains Indians of North America) a brave or reckless deed performed in battle by a single warrior, as touching or striking an enemy warrior without sustaining injury oneself.
  3. coup d’état.

Strictly speaking, it would appear as if the hashtag #ThisIsACoup is actually praising the bailout agreement that Greece and the Eurozone have come up with as “a highly successful, unexpected stroke, act, or move; a clever action or accomplishment.” However, if you read the thread, it is clear that the vast majority of people on have actually understood the Twitter hashtag #ThisIsACoup as the exact opposite. And took the opportunity to engage in a bit of Germany bashing while they were about it.

As an aside, what is not being reported is that there is also a hashtag #ThisIsNOTaCoup where quite a few people are arguing the opposite. Although I do agree with this particular hashtag, they are also missing the point.

This takes us to the third meaning, namely of a “coup d’état” which is, of course, what the hashtag #ThisIsACoup does not say but presumably actually meant to say.

So let us examine this option. The same source (Dictionary.com) defines a coup d’état as: “a sudden and decisive action in politics, especially one resulting in a change of government illegally or by force.” Furthermore, it identifies various synonyms for coup d’état, including “overthrow, rebellion, revolution, uprising.”

It seems as if the vast majority of people actually were talking about the hashtag #ThisIsACoupD’état rather than #ThisIsACoup. But let us examine if this makes any sense, despite its obvious popularity:

  1. A sudden and decisive action in politics: really? I could have sworn that what has happened is the very opposite of this. The Greek crisis has been at least five long years in the making, there have been two bail outs already and an excruciatingly drawn out process of six months since Syriza came to power. Sorry, but the Twitters seem to be backing the wrong horse again, Nobel Laureate included.
  2. Resulting in a change of government illegally or by force: Really? Again, I could have sworn that the process has been the opposite of this. It seems to me as if the people of Greece have not only elected the political party (Syriza) which the “Eurocrats” did not want but also reinforced the point by offering up the referendum result that the Eurozone was hoping to avoid. Has there been a change in Government in Greece since the January general election? Has anything been done illegally or by force? I don´t think so. In fact, if anything is being done illegally it is that many of the other 18 members of the Eurozone, Germany included, are actually doing somersaults to keep Greece in the Euro despite the sentiment of their own electorates. There are 19 countries and democracies to take into consideration in the Eurozone, not just Greece. And this is before even mentioning the fact that transfer union is illegal, as are debt write offs and permanent bailouts in the Eurozone. Yet effectively all three are being done in one way or another in order to assist Greece.
  3. As for the synonyms “overthrow, rebellion, revolution, uprising,” do these really apply? I am not convinced. There has not been an overthrow or revolution of any kind and the Greek parliament will have its chance to reject the whole potential bailout package if they so wish. If there has been a rebellion/uprising, it is on the part of Syriza in relation to its approach to austerity, its debts and the conditionality which previous Greek governments have signed up to  and unorthodox manner by which it has carried out the negotiations with the rest of the Eurozone countries. This is not something that has been done to the Greeks, except for the Eurozone´s insistence that they deliver on their reform commitments (this time around) before getting their hands on the bailout cash. After all, money does not grow on trees. As I have previously argued, the Greeks have had two general elections and one referendum to leave the Euro and/or the EU. They have resolutely stuck to the current path of remaining in the Euro and the EU. If anyone is advocating a coup d’état, it is the commentators that are shrilly insisting that the Greek government rejects its electorate´s views in two general elections and leave the Euro as soon as possible. If the same wish to argue that the Greek Referendum was a vote to leave the Euro, let them try to make that case but they will get nowhere since the question was so convoluted as to be meaningless. It could not possibly be construed as a desire to leave the Euro and no one is claiming that.

So please, you Twitters out there, do get your facts right instead of blindly following the herd instinct.

If you meant that “this is a coup”, then you have actually been lavishing praise on the Eurozone members and the agreement that was reached at the eleventh hour.

I think it is a flawed agreement but better than none.

And it you actually meant that “this is a coup d’état” (which is clearly not what the hashtag actually says), you have also  got it completely wrong.

Either way the hashtag #ThisIsACoup that has been globally trending is misleading to put it mildly.