Nothing to Fear but Fear Itself....

This week I find myself in Madrid, the very pleasantly sunny capital of Spain. As I write these words, I am enjoying a very tasty 'desayuno' consisting of coffee, fresh orange juice and a bocadillero (which seems to be a very large chocolate bun) at a local cafeteria, restaurant and cervezeria that glories in the title of "El Restaurante Jordan Gala". Having spent a month shivering and quivering in the unseasonably cold UK (it's been the second coldest April on record, apparently), I decided that it would be expedient to set off on my peripatetic perambulations once more and head South for sunnier climes (as it happens, a heat wave hit Britain three days after I left - que sera...).
Madrid in the last week has enjoyed temperatures in the mid 20's centigrade, occasionally spiking to the low 30's if the local wall-mounted thermometers are anything to go by. These sort of temperatures just about qualify as pleasant for me these days – one becomes somewhat spoilt by the constant 35 plus of Thailand, a little too hot perhaps, especially when compared to the UK, but surprisingly easy to get used to.
The UK, at the time of writing, is caught up in an ongoing campaign prior to a referendum on remaining in the European Union. The actual vote is still nearly two months away, but the tactics employed by the remain campaign seem like an echo of those used to win the Scottish referendum of last year. At the time it was known as 'Project Fear', dire warnings of all the terrible consequences that would befall the Scots if they dared to leave the Union. The current EU campaign feels like deja vu all over again… every piece of bad economic news that emerges is blamed on the possibility of exit, or Brexit as it has become popularly known.

Unemployment was up last month – because of fears of a British exit apparently.
The growth figures were down last month – because of fears of a British exit.
The second coldest April on record – no doubt because of fears of a British exit…
We are told that house prices will drop, wars are more likely, the UK's security will be threatened, industry will suffer, prices in the shops will raise and every family will somehow be £4300 worse off by 2030 (a rather magical figure, as it turned out, produced by projecting figures that the treasury have rarely managed to get right over three months out to fourteen years, then using a completely fictitious method to calculate household income - et voila, £4300!).
 
It seems that anything and everything negative that happens in the UK at the moment is down to fears of a British exit from the EU. Oddly, the opposite effect seems never to be observed. Whenever good economic stories emerge no reference at all is then made to the possibility of Brexit being at the root. One wonders why?
At the start of the referendum process, and as someone quite pro-European, I was leaning towards the notion that staying in the EU was the better option. I was aware of the relatively peaceful state of affairs since the inception of the Common Market and was inclined to believe that at least some of that peace and prosperity was down to the sharing of the economic interests of the central European powers.
Unfortunately, the more I looked into the matter, the more I realised that the EU is an institution that stands for almost everything that I perceive as being at the root of the problems that plague our World today. One of the most egregious of these is the pernicious effects of globalisation, the process whereby fewer and fewer multi-national companies come to dominate the World's economy, usually undercutting and ruining local communities and small businesses in the process.
Two days ago, I spent a delightfully sunny afternoon in the centre of Madrid. I alighted from the metro at Banca de Espana and made my way up to the Calle de las Infantas. I found this narrow street to be thoroughly charming. I had gone in search of a local shop that specialised in juggling equipment (unfortunately closed recently – yet another victim of the process it seems), but found numerous small and very colourful shops, each unique, each very individual and very Spanish in character. I spent nearly an hour wandering in flaneurial fashion from shop to shop enjoy the imaginative décor, the shop windows and the goods on offer. For someone such as myself, well disposed to strolling through the World's more interesting cities, this was a pleasant experience indeed.

Unfortunately, it did not last long. Pretty soon I was in the Calle del Clavel, leading down to the Gran Via. This pedestrianised area was packed with the likes of Nike, New Balance, Starbucks and various other American based multi-nationals selling exactly the same stuff as they do in Hong Kong, Beijing, Bangkok, London, Paris or New York. The type of corporation that turns you from being a customer into being a consumer. The type of corporation that is killing local business everywhere. The type of corporation that pays rock-bottom rates to their staff and their suppliers, whilst at the same time avoiding tax whenever and wherever possible. Given their influence in the seats of government and in the EU, barely ever are they brought to book for their nefarious practices. All this results in an enormous competitive advantage which makes it nigh on impossible for small, locally run business, paying their fair share of tax and their employees a reasonable wage, to compete.
Small, as E.F. Schumacher pointed out in his 1973 book, is indeed beautiful. It is also somewhat more fragile, especially when opposed by the power of multi nationals backed by the might of trading blocks such as NAFTA and the EU. Such blocks reach well beyond government, well beyond the democratic process to impose their standardised, homogenised, de-individualised World upon us all. 

 
Such trading blocks are little influenced by notions of social responsibility or democracy. They are there to be lobbied by corporations and multi-nationals, often to the mutual benefit of the corporations and the likes of the EU Commissioners. As regards the EU itself, it is interesting to note,that the most powerful part is not the parliament, but the totally non-elected Commission. The politicians come and go, but the all-powerful Commission remains, unreachable, untouchable, unchangeable by the electorate, yet lobbied (often a euphemism in itself) and influenced by big business and the forces of globalisation.
This lack of accountability of the EU Commission is one aspect of the so called 'democratic deficit'. There is lip service to the needs of society, but when it push comes to shove (think Greece, Spain, Italy, Ireland and Portugal) it is the needs of the financiers, of the banks, of the corporations that are catered for, no matter how severe the effects of the austerity imposed on these countries are. In effect, what we have is a massive transfer of money from national governments and tax payers into the hands of corporations. The EU itself is at the very heart of this process.

Back in the Jordan Gala, I find myself enjoying the very sociable atmosphere  and the general conviviality of the place. The Spanish, fortunately, seem to have lost little of their appetite for good living, for enjoying themselves, for friendliness, despite suffering for years now under the cosh of austerity imposed via the EU. The effects in the smaller suburbs of Madrid are all too readily apparent; high rates of unemployment, buildings in need of repair, streets needing to be cleaned. Beneath this though, and despite the ravages of draconian and ineffective austerity, the spirit of the people shines through. Spain, like the UK, like many countries in Europe, needs to free itself from the shackles imposed by the EU or face ever more austerity and ever steeper decline in living standards for all but the select few.
 

We Are All In This Together...

This week, I find myself back in the UK and enjoying a generous, if not particularly tasty, cup of 'Pike Place' from Starbucks in Epping. Starbucks are the sort of company that, in general, I tend to avoid as representing some of the more irresponsible strategies and tactics that such concern employ in order to avoid paying taxes in the countries where their outlets are actually located. I think my favourite from Starbucks was the importation of coffee beans from that well known coffee 'producer.'..Switzerland (the word 'riiiight' springs to mind). Given the subject matter of today's blog however, I thought that it might be appropriate to put my head in the mouth of the beast.
During the last few days a scandal of global proportions has broken over the tax dealings of many of the rich, powerful and famous. I use the word 'global' advisedly, as those implicated range from the father of the British Prime Minster David Cameron to the brother in law of Chinese Premier Xi Jingping, from the Royal family of Saudi Arabia to the business 'associates' of Vladimir Putin, from the talentless Simon Cowell to the talented Lionel Messi. All it would seem, if the evidence of the released documents is to be believed (it does indeed appear to be a very well substantiated leak), have been happily avoiding large amounts of taxation in the very countries that they are plying their trades or form part of the political or business establishment.
As I read the allegations that related to the apparently nefarious doings of David Cameron's father, Ian Cameron, and his investment company, Blairmore Holdings, I could not help but recall the UK prime minister's words when he took up the reins in 2010: “We are all in this together.” At the time, I was under the impression that what was being referred to was the austerity being imposed as a result of the financial crisis and bank collapses of 2008 instigated by the banking services industry. Now, in retrospect, it appears that 'we' may have been referring to the wealthy and powerful, and 'this' the massive tax avoidance that so many of them seem to have indulged in. 

 
In Iceland as I write, Prime Minister Sigmundur David Gunnlaugsson is facing calls to resign following revelations that his wife was involved in just such practices. Odd how often that seems to happen. Perfectly respectable pillars of the community like the Maxwell brothers or Philip Green seem to be fortunate enough to have very pro-active wives suitably concerned with preserving the family wealth by becoming adept at the nefarious skills of tax 'efficient' conduct. Lucky them…

In Russia, the trail has led to a very close friend of the premier, Vladimir Putin. A cellist by profession, with apparently no business acumen, yet the documents released show him to be again and again being involved in multi million dollar deals that he seems to have little or no knowledge of. I suppose that in such circumstances it must be comforting for the Russian President to have a friend so adept at fiddling...

Vladimir Putin's favourite fiddler...

 In China, it seems that the documents implicate the husband of the premier's older sister, Deng Jiagui. Xi Jinping himself has been running a well publicised campaign to stamp down on the widespread corruption within official and business circles in China. Interestingly though, his own families wealth now runs in the hundreds of millions. I for one am very impressed with the investment skills which obviously he and his family must possess. His salary is in the region of $22,256 a year, and that only after his rise to the top of the political tree. It would seem quite an achievement to turn such limited resources into the huge financial empire he now finds himself the head of.

Chinese leaders with their financial adept relatives...

Reading the Chinese Communist Party's media outlet, The Global Times, one has to be impressed at the prowess of the investigative journalism on display. The only article published to date talks of 'Western smear campaigns' (conveniently ignoring the fact that many Western leaders themselves have been implicated) and fails to even mention the connections leading to the premier, or even to his family. Journalistic truth is a very flexible concept at times, but perhaps never so much as is the case in China.
The usual blowhards represent such a scandal in terms of East versus West, or maybe capitalism versus communism, or some other such anachronistic nonsense. The reality, unfortunately, is far more sinister. Worldwide the gap between the wealthy and the poor has been growing at a huge rate for the past few decades, getting increasingly worrisome with the passing of time. Unfortunately, with globalisation and with the influence of financial services, banking and moneyed concerns on governance, there now seems to be little or no defence to the hegemony of the plutocrats.
All very sad. The likely result of all this will be a few scandals here and there, a few speeches by government ministers about the evils of tax avoidance, but very little action indeed. Those that are making the laws are themselves the beneficiaries of such practices. Given that, it would appear highly unlikely that they will pay anything other than lip service to reform.
The UK government itself perhaps represent a particularly adept use of rhetoric followed by a complete and utter lack of action. Three examples among many spring to mind. The extremes of the Murdoch press were supposed to be regulated after a range of illegal activities were perpetrated by them, the Prime Minister himself making several stirring speeches on the subject. The result six years later? Nothing. Even a refusal to sign through the very limited proposals of the Levonson enquiry. Rupert must be pleased, at least. Secondly, the regulation and prosecution of the bankers who caused such damage to the World's and the UK's economy back in 2008. Eight years later we have had precisely one prosecution, a low level banker of little importance, and no enforced regulation whatsoever. Thirdly, the current topic – clamping down on tax avoidance schemes. Again many a stirring word has been uttered by Messrs Cameron and Osborne on the subject. The result of all these fine words? Nothing, nada, zilch, not a thing. Osbrone carries on enjoying the hospitality of Russian oligarchs whilst Cameron works out ways to word statements to avoid his own all too apparent apparent culpability.

Osborne and his yachting companions, Oleg Deripaska and the Prince of Darkness himself...

Sad times indeed.
Back in Starbucks I finish the admittedly generous cup of Pike Place. It is a comfort to know, as I imbibe the very last drops, that scarcely any of the £1.95 I paid for said beverage will find its way into the hands of the exchequer but will instead be lining the pockets of the already fabulously wealthy but obviously still very needy owners of this enterprise...

The Old Boys Club...

  “When Small men begin to cast big shadows, it means that the sun is about to set.”
Lin Yutang

Early May in the UK, and I find myself enduring the fairly typical weather in these islands. It is generally cold, wet and windy, although happily it is about to improve, at least if the forecasters of the BBC are to be believed. The one day in the last week that was an exception to the ongoing gloom was Thursday, the day on which the general election was held. In the UK, the advent of decent weather for such a day was supposed to improve the turnout. It did … in Scotland at least. South of the border the turnout was much the same as usual, at around 65 %. As the winning party managed to poll 36.7%, this effectively meant that only about 1 person in every 4 actually voted for them. In the strangely undemocratic democratic system of the UK, this is enough to give the winning party a majority.
There was much frustration all around, perhaps none more poignant than than of UKIP (United Kingdom Independence Party). Personally, I have little sympathy with their views, but much empathy with their frustration. On the day they polled 12.6% of the vote, approximately a third of the Conservative party's 36.7%. The result? The Conservatives end up with 331 times the 1 seat that was given to UKIP in this bizarre system.

UKIP also managed to attract something like two and a half times the number of votes that the SNP (Scottish Nationalist Party) polled. Again, their 3,881,129 votes gave them just the one seat, whilst the SNP's 1,454,436 gave them 56. One wonders if this is an example of the kind of 'democracy' that the West has been so keen to impose on the rest of the planet in recent times. The 'first past the post' system employed in the UK seems to be a pretty random form of democracy at best.

In the end, the conservative with a 'small c' United Kingdom ended up with a Conservative with a 'big C' government, as is their usual wont in these islands. The only interruption in the last 36 years of Conservative rule came when the Labour Party essentially ditched any notion of being socialist and became instead a mirror image of the Conservatives. Basically, they out-toried the Tories. This seems to be just about the only way they have any chance of being elected in this somewhat insular country. Napoleon Bonaparte was perhaps displaying a fair degree of insight when he made the observation some two hundred years ago: “L'Angleterre est une nation de boutiquiers.”

One of the things I have not missed about the UK is the class warfare, although it seems to be a battle fought by just one side these days. The wealthy, and those many politicians who represent their interests, seem forever engaged in finding new ways to dis-empower the poor and make their plight ever more desperate. The poor, for their part, are just struggling to keep their heads above the ever rising tide. The word class is perhaps particularly apt in this context, given that many of our current crops of Tories, at least the influential ones, shared the same school, Eton. Some of these, notably Messrs. Cameron, Osborne and Johnson, went on to Oxford, joining the (in)famous Bullingdon Club and having a jolly spiffing time...

Oh well, as an old friend used to say, 'If things don't change, they will stay the same.' Or perhaps the Thai saying, 'same old, same old' is more applicable here.
Within a week or two, after the euphoria of victory, it will be back to the internecine in-fighting that the Tories specialise in. If things revert to the normal pattern that the Conservative Party loves to indulge in, there will be endless trench warfare within the party, factions within factions, particularly over the issue of Europe. One of the joys of travelling is leaving all this far behind.

Hopefully, within a week or two, I can set out once more for another part of the world and leave the rather dull, archaic and downright illogical machinations of the UK's political system to its own devices. There is some chance that I will be able to head off to Spain, perhaps Girona, Barcelona or Tarragona, in the very near future. If all goes well, I intend to spend at least a day or two in Madrid as well. Given the current state of the weather, and the current state of the politics here in the UK, the continuation of my travels cannot come too soon for this nomadic flaneur.