Blog 2023 Malcolm Blair-Robinson

Ministry of Defence

It is good that Dr. Fox is to set about slimming the MOD. I would go further and close it down altogether. As previously stated in this blog, we did not have it in all the previous world wars and we do not need it now. It is the most financially incompetent organisation in the country and acts as a millstone round the neck of the professional military with its utterly clueless stewardship of our armed forces.

We need a small, efficient keen and lean Army Ministry, Air Ministry and Admiralty getting the best and best value out of the three services. This is how we won all our wars. The battle record of the MOD is much more ambiguous. Having said that, the new proposals are certainly a step in the right direction and should be supported. They need to be followed up with a more coherent strategic plan based on a less bombastic foreign policy. The SDR will hopefully bring that nearer.

German Recovery

The second quarter growth figures of the German economy are startling. This is very good news. Germany demonstrates that it has the strongest economy in Europe, founded on manufacture and exports, which can take advantage of the weaker euro, weighed down by sovereign debt of southern euro zone countries. It also points the way forward for the U.K.

A factor in the German recovery is the willingness of consumers to spend some money. It is very intersting to compare the total foreign debt of the two countries. Germany stands at 1.5 x GDP. The U.K. is 4.5 x GDP. This is the core of the stronger German performance. In the U.K consumers are busy reducing their binge borrowings of the past. Comparing government debt shows less difference, both countries are hovering around 70%, but this will go up before it goes down.

Another key factor with the Germany economy is that it is based on exports and its industrialists have been very quick of the mark to develop new business in the cash rich new economies of Asia and South America. We have been very much focused on the imbalance of our trade with these economies, though less well focused on what to do about it.

It will not be surprising if Germany emerges as the strongest economy in the West. The economic challenges of re-unification have been mastered and there is now a fully operational united German powerhouse. We may find some surprises ahead. Meanwhile the figures should bring comfort to the beleaguered Merkel.

Prudential Results

The unexpectedly good results from the Pru, coming together with other good results from insurance companies offering investment products, is due in significant part to the rise in sales volumes of savings, which are now flowing very strongly. This is another piece of good news liable to be lost in the worries about a double dip recession, but it is  very important step on the way of building a sounder economic model, upon which to set economic recovery that lasts.

The Tories and Lib Dems

Commentators, without Parliament sitting, find it harder to run stories about strains between the coalition partners as a decamped Westminster village scatters its rumour mill to the four winds. Attention has again turned to whether the Lib Dems, with very low poll ratings, are going to disappear into the Conservatives, as the National Liberals did in the thirties and forties. This is an interesting question.

From the point of view of those who like power in the Lib Dems and that is by no means all of them, the ideal would be something akin to the German Free Democrats, who have been a moderating influence as a junior coalition partner in a good many German governments led by both the main opposing parties, in the years since the war. There are others who see power as tainting the purity of their idealism, because of the compromises the reality of government requires. There is also the rump of the old SDP tradition which was closer to Labour. It was, after all, the Social Democratic Party.

The Tories are in part composed of pragmatists who see their party as the natural grouping of efficient government, charged with sorting out the excesses of radical interludes. However Thatcher was a radical and a fiery one at that. Under her, the party became radical and right wing, pulling Labour across to the centre, which it eventually seized. The modern Conservative party is therefore a somewhat disparate coalition of its own. It has not only a right, centre and left;  it  has also pragmatic and radical wings. Mixed up in all of it, is a rather effete grouping of scholarly elders steeped in Disraeli, Peel and Trollope. 

Cameron has, with a brilliance history alone will be able truly to savour, turned his electoral weakness (the Tories should have won outright) into not only a remarkable government, but also a programme of re-engineering the Tory party back to the pragmatic grouping of sensible national leadership which served so well under Baldwin, Chamberlain, Churchill and Macmillan. Taken together these four leaders (including the short reign of the discredited Eden) held power for twenty-seven of the thirty-three years between 1931 and 1964. During this period the old Liberal party declined steadily from fifty-nine members as the country went to the polls in 1931, to just six by 1964.

What happens this time to the Lib Dems depends on how successful Cameron is, in welding the power seekers among them into the new more liberal Conservative party. He has spotted that this is the route to extended power. So has his closest political ally, Nick Clegg.  Barring the way is a combination of right wingers, left wingers and serial consciences who value purity above power. Nevertheless these two young men of near identical appearence, education and wealth, but not of manner or blood, form a combination so determined that it may be unstoppable.

Viewed in the round, the prospects for the Lib Dems as an independent entity of significance do not look good. If the Conservative led coalition is a success, but the junior partner refuses to join an electoral pact, it will lose heavily as the country votes for the organ grinder not the monkey. If it joins a pact, it will be absorbed, as before. If the government fails, the Lib Dems will be massacred by Labour under its new, as yet unknown, leader, likely to be one or other Milliband. 

The only route of continued independence at the centre of power may be to dump the Tories in favour of Labour when the going ahead gets tough and the public get angry. Pretty ruthless stuff that. Not very Lib Dem. But then they have Clegg, and he demonstrated in May that he was the most ruthless politician around.

Iraq Pull Out

The top Iraqi General has said he would like U.S troops to stay another twenty years. This is clearly impossible, although I am sure there are elemnts in the Pentagon who would love it.

What the General’s comments underline is the chronic instability of the Iraqi State as a viable, self sustaining structure, able to stand by consensus and cooperation among its people. Most of its history, from inception, has either been the exploitative, though fair, administration of the British Empire or the Sunni dominated regime of Saddam Hussein and the Ba’athists. Neither of these administrative systems was concensual. Both imposed discipline and order at the cost of freedoms, which are today described as human rights. There is no doubt that Saddam’s regime was brutal and favoured Sunnis over Shiites and Kurds.

There can be no  prediction of how this is going to end, whether Iraq will survive as a single state, whether it or its successor components will be democratic or whether there will be civil war. All we can say is that the security situation appears ominous, the democracy seems unable to pass the key test of producing a government and  more bloodshed is certain.

In this condition of current affairs, any judgement overall must be unreliable. However as the combat troops prepare to leave, let us not forget the aim of the mission. It was to effect regime change and establish a ‘beacon of democracy’ to bring peace across the Middle East. Oh yes, and to get at those weapons of mass destruction. Judged in the terms of aim versus outcome, it ranks as one of the greatest political and military failures in history.

Playground Cuts

Certainly nobody can accuse Michael Gove of being a hesitant cutter. Playgrounds, part of some grandiose initiative by Labour in its twilight hour, are the latest victim of his axe. The problem, as always, with so many of the spending plans of the fallen government, is that it lost the connection between launching programmes and having the money to fund them.

Very disappointed organisers, parents and children is the certain result of an inevitable, but unpopular, decision. However, it occurs to me that if the Big Society is to show its mettle, this is a good place to start. Setting up a fun playground is just the stuff for a local community to get stuck into. Playgrounds really never had anything to do with central government. Its job is to organise the economy, defend the realm and so on and so forth. The people can be trusted to work in partnership with local government and fundraisers to fix their own children’s playgrounds surely?

Al-Qaeda returns to Iraq

There is a report today in the Guardian that members of U.S. backed Sunni militias are rejoining al-Qaeda in Iraq because they are being offered better pay. If this is true it shows an unravelling of a dream that was never real.

At the end of the month American troops will, as a combat mission, be gone. A considerable number will remain as advisers and so on. There is still no agreed government after an inconclusive election. The security situation is deteriorating. After eight years of bloodshed and cost, not only in real terms but in America’s standing internationally, the apparent outcome is a travesty of the original goal.

This news comes on top of a deteriorating picture in Afghanistan and a Pakistan in a turmoil of floods, militancy and unease. The big picture is now looming into view, so large that it will have to be faced. It is not the vision of the original protagonists of these destructive wars. It is much closer to the fears of those who saw the follies from the beginning.

Soon all this will all have to confronted. There will be a political earthquake on both sides of the Atlantic. Neither Obama nor Cameron were in on this at the beginning and both now regret earlier support for these wars, albeit lukewarm and conditional. Nevertheless both have been taken in by their optimistic military and the irrational supposition that their homelands are in some way safer. Each has at their side a deputy far less enthusiastic, Biden and Clegg. All four will have to work very hard and together to survive without fatal electoral damage.

The Senators are Back

They really do not get the message, these guys. It is not in order for American Senators, however distinguished and whomever they represent, to badger and cajole a Sovereign Government of a foreign country, itself a constituent part of another Kingdom. The Americans may not like the decision the Scots made, nor agree with the motives nor like it any which way they look at it, but they have to accept it, because it is beyond their power and their remit. It is odd that they simply cannot see that.

Alex Salmond will no doubt be courteous but firm when he says no. He can go on and say that while the Senators may see nothing which is not in the public domain or available under our freedom of information statute, they may see everything that is. That should be that. Knowing these Senators it will not be. Until after the mid-term elections. After those are over, either it will no longer matter, or they will no longer hold office.

Bank of England Forecast

We have learned from the financial crisis and the consequent recession that whilst most economists agree on the obvious elements of the cause, not everyone is agreed on the root cause. When it comes to how to orchestrate a recovery, there is a sharp division between Keynesians and Monetarists.

Central to the argument is forecasts. In my view they play far too big a role. In the end it is what happens which counts. Like bets, forecasts are fun but they are not fundamental. We are near a dangerous point of trimming policy to forecasts, when the opposite must be the rule. Policy must be based on the need to rebuild the economy on sound principles which will offer real prospects of long term prosperity, not another bubble.

To repeat the mantra of this blog, in case you are new to the site and do not have time to browse previous posts, this can only be done by nurturing the strong in enterprise, industry, retail, commerce and domestic life and allowing the weak and the flawed to fade. This creates opportunity for innovation and enterprise to fill gaps and consolidate markets. It reduces gearing and increases net investment. It requires efficient use of assets, selling off to raise more capital for example, more saving and re-investment of profits and less borrowing.

It requires banks to be cautious about lending initially but to back winners who show they can run cost effective businesses which create real new wealth, not inflate assets thus devaluing money. Services need to enable the economy not drain it. Households need to be net savers and spend money earned rather than borrowed. Growth must be founded in industry and business, not the High Street. Retailing must be the beneficiary of growth not the cause of it.

House prices must return to their relationship with earnings of twenty five years agoof  x3. People will then be able to live on what they earn and save, borrowing only for real growth in their circumstances to enhance future wealth, not to pay for groceries or petrol because the cash runs out before payday. When the tills ring out in the High Streets, Malls and Retail Parks more of the takings have to go to British manufacturers creating British jobs.

In the context of all this, the recent good news is the return of falling house prices, cautious bank lending, net saving of households and net deposits in banks and above all a significant narrowing of the trade gap, all  announced, but either ignored or remarked on for the wrong reasons.

What the Bank of England forecasts is academic. What it does, is not. What it will have to do soon is raise interest rates. Inflation cannot be allowed to bolt.

Changing Tide

There are times in history when retrospectively a moment is seen when the tide of events begins to flow in another direction. For example, Gettesburg, seen as a stalemate or draw at the time (Lee’s army withdrew intact at its own pace south, while the Union remained on the field, but too mauled to pursue; Lincoln was furious) is now seen as a great Union victory, because it was clear from that moment on that the South could not win the war. It took a further two years for the North to prove it could win, but that July day was the moment when fate pointed the way.

The Summer of 2010 will be seen as the moment when the people of this country lost faith in the politics of  military force. Iraq has no agreed government following its general election months ago and violence increases. The country has not even a power supply to last the day. What is going to happen next nobody knows. In Afghanistan the strategy is unravelling while casualties are  rising. Safe areas are found to be unsafe after all.

The critical fragility of Pakistan as a country, laid bare by monsoon rains and the ambiguity of its key institutions, forced into the war on terror against the will of far too many moderate Pakistanis, is exacerbated by the terrible suffering of so many of its people in the floods and the curious detachment of its President wafting in luxury around Europe. However Pakistan and Afghanistan accommodate each other and eventually settle down, one thing is now clear to those willing to see; it will not be by the path proclaimed from the Pentagon, Nato Headquarters or  the MOD.

There is more. The extraordinary hostility to BP, notwithstanding the disaster which in the end, considering the challenges, it appears to have managed quite well, and the irrational hysteria over the release Lockerbie bomber has left a bad taste in the U.K. The continuous reference to British Petroleum, although its U.S. management and half its shareholders were American, was spiteful and unpleasant. The preposterous invitations from those Senators, to attend before them in supplication to answer questions, of Ministers and ex- ministers of the U.K and Scottish governments, united all elements of the country in hostility.

Most telling of all was the definition by Cardinal O’Brien that Britain has a concept of justice based on mercy and compassion while America is focused on vengeance and retribution. In those brave words the Cardinal struck a chord with the multitude. Nothing in future transatlantic relations will ever be quite the same. This does not mean that the U.S will not plot an attack on Iran or get in a fight with North Korea. These and other as yet unforeseen adventures are variably possible. What is becoming clear is that British politicians will find it much harder to carry the country with them if they decide to join in. Indeed public opinion may force fewer cuts to services and more to the military, removing their power to join in anyway.

We shall then concentrate our defence resourses on systems to defend our island homeland come what may. The strategy which has kept us free and independent for nearly a thousand years since the Norman Conquest, is based on the simple principle that we are too tough a nut to crack. In the crises of the Spanish Armada, Napoleon, the Somme and the Battle of Britain, the Americans, come to think of it, were nowhere to be seen.