The spin on the spin

There's been something of a triumph of spin on the EU's MFF share-out. Oh I don't mean the headlines, which we summarised last week, but the rationale. Spain and Italy get the biggest share for the next seven years because they have been hardest hit by Covid, the spin went. And hardly anyone said "Hold on - Covid hasn't gone. What if Poland goes down next year, or the Netherlands?"

Of course, as Rutte and Kurz know full well, Covid has been the cover for propping up the generous but unaffordable pension commitments in Spain and Italy. I told my old mate in the pub last night not to worry - Germany was paying for the mad Med pensions. He was just paying for Slovenia and Croatia. "What?

Austria pays €14bn into the MFF; Slovenia gets €1.2bn and Croatia €12.1bn. That's €1,580 from the purses of every Austrian and €2,969 into the wallets of every Croatian. "Croatia? Why do they need money? Have you seen the price of property there now? Their hotels cost the same as ours and are more fully booked, their trains are new, new stations, bridges - we paid for all that already".

I have my own suspicions - and they're around Tito's old nuclear power plant at Krško (say Crooshgo), shared between Croatia and Slovenia, due for decommissioning from 2023 but now extended for another twenty years. The EU insists it's safe, but our nuclear leak (and other civil emergencies) warning sirens are still tested every Saturday at 12 noon, and most folk have a 7-day course of Iodine pills in the first aid box.  More specifically, Croatia has a contractual obligation to take 50% of the nuclear waste by 2025, hasn't got anywhere to put it and Slovenia has run out of storage. That's my guess, anyhow.

That's the sort of thing that Covid is helping to hide. Don't tell the tourists headed for the Adriatic beaches that there's a nuclear waste dump behind the hotel, don't tell the punters hard at work in Munich that their taxes are being drunk by Luigi and Alphonse sitting in the sun outside their tavernas. Hey ho.

EU manages a deal that angers everyone

Just when you thought the farce that is the EU couldn't sink any lower, they've managed to agree a Covid recovery plan that has angered just about everyone. Spain and Italy are furious because they don't get enough, Germany Austria and the Netherlands furious because they're paying for what they are getting. The French are in a rage with Macron - who is hiding from them in his big gold palace; the Poles and Hungarians are ticked that any money is tied to changing their national mandates for Brussels' ones. The European Parliament is very cross with two of the EU's Presidents, VDL and Charles Michel. The Italians are incensed with Conte, the Dutch with Rutte. The Irish are demented that in Brexit year they will pay more and get less, and the Commission is vexed that Ireland has just won a tax fight against them. I've never known a deal be so successful in pitting so many of the EU's actors against eachother.

Unelected bureaucrats think they're happy because the deal has just ratcheted up federal power and authority, but at the cost of a big hit to public satisfaction, which will grow as the utter inadequacy of the MFF and Covid package becomes clear.

What's even more absurd is that they only got this deal because no-one wanted to go on record for this recent round being the longest ever European Council summit. It just beat the longest, we are told, by fifteen minutes. So glad. Pleased to see it's the PR merchants driving the talks not the national interests of 420m people and 27 nations.

The European Parliament, politico EU reports, wanted a deal €266bn bigger than Michel's starting point; instead they've got one about €130bn smaller.  Charles Michel's summary of the summit process - "Europe is united, Europe is present. We have demonstrated that the magic of the European project works because when we think that it is impossible, there is a spring in our step thanks to respect and cooperation." - must surely rank with Lyndon Johnson's 1964 Vietnam pledge that "We are not about to send American boys nine or ten thousand miles away from home to do what Asian boys ought to be doing for themselves."

Boy, aren't we glad we left. 

Fish reality starts to sink-in

Remainer minds are remarkably resilient, and none more so than that of Jeremy Warner in the 'graph. The poor chap can simply not conceive that control of our 200 mile EEZ is more important to the nation than bankers' bonuses. Even now it takes more torque than dragging your granny away from Corrie to penetrate that kind of thinking. Again today Warner writes

If it is true that the EU is on the verge of conceding that Britain should have the same control over fishing rights as enjoyed by Norway, it seems reasonable to assume that there will be no concessions on equivalence. An economically hugely important sector is about to be sacrificed to the politics of an insignificant one.

Jeremy, sweetie, listen up.

It really is not a matter of the EU 'conceding' anything. From next year under international law the UK becomes an independent coastal state. The EU have absolutely no say in the matter, none at all. They cannot prevent it. It is a matter of immutable fact.

How has the EU managed to convince an otherwise sane and rational man against all the evidence, the law, the actuality, that they still have some sort of say over this happening? Incredible.

Bone-headed ain't in it.

And don't worry about the City. The timezone, the language, the judicial system and courts and above all the critical mass of analogous expertises in a world city of unparalleled attractions will mean dull, provincial little towns with a mime theatre and two massage parlours such as Frankfurt will never come close to being a threat.

A Fair Fishing policy - EU must act responsibly

The operation of Liquidated Damages is one of the first lessons anyone learns in Construction Contracts 101. The contract provision cannot operate in any way as a 'penalty clause' if it is to be enforceable; LADs must be a genuine pre-estimate of valuable loss and damage arising from the contractor's failure to complete by the due date. And this, I think, is a valuable lesson for the way in which we can use our EEZ after the end of the year.

One of the reasons why we are so determined not to give away any binding commitments to EU nations, and to stick to the granting of annual licences (which we can expect to slip to an offer of biannual in the final round of negotiations - which the EU may not want to take-up) is that the extent of any licence is wholly at the discretion of the UK. They're our waters.

However, we face challenges. One is illegal fishing and over-fishing by vessels from EU nations, or the use of vessels and methods of fishing which will be banned in UK waters. Drone surveillance and marine intelligence may inform us of offending, but enforcement action is costly. Not only the costs of patrol vessels with Royal Marines boarding parties, the costs of taking into custody offending boats and skippers, and of mounting prosecutions. It costs big money.

Then there is the failure by those same EU coastal states to control illegal migration from their nations to the UK - a failure amply demonstrated by Nigel Farage in recent weeks. Every migrant that France assists across the Channel comes with a lifetime cost - few of them will become net contributors. The TPA has estimated that net lifetime costs could be in the region £0.3m - £1m for each migrant. This, too, is a breach of our Exclusive Economic Zone - migration is an economic matter.

EU nations make big money from British fish. The FT reports that EU boats land more than 700,000 tonnes of fish from UK waters each year. Even if that figure reduces by half after licensing, it is still a very substantial sum.

And so we must consider a defaults system. A process for notifying breaches and defaults to the offending EU coastal state should be put in place - failures both by EU national governments to secure the EU border and breaches of fishing regulations by EU flagged vessels - with a mechanism for response and appeal to a UK tribunal. Any defaults accumulated during the course of a year would result in an appropriate reduction in licence quota for the following year - or two years, with biannual licences. The extent of reduction, like LADs, would be directly related to the estimated NPV of the cost of the breach, whether costs of maintaining migrants or the long-term depredations to fish stocks as an economic resource by illegal fishing, or the estimated costs of physical enforcement. A rubber boat full of illegal migrants may be valued at £10m, an illegal-mesh net £5m.

This is why the EU wants so much to secure a permanent legal right to fish in our waters. It would prevent us from implementing such a fair and reasonable licence condition. A properly formulated defaults system would stand up to challenges in both UK courts and international tribunals. Like LADs, such licence adjustments must be genuine pre-estimates of loss and damage.

The defaults scheme would also have beneficial consequences - EU fishing fleets would be motivated to take action themselves to prevent illegal migration in small boats; every raft let though by the French coastguard would cost them money. And EU national authorities would properly police their borders, as a failure to do so would result in lost votes and angry protests from a volatile fishing industry. It's win-win as far as I can see. And marine ecology and sustainable fishing would also be immeasurably improved - so even the Gretas could support it.  

No-deal seems like a done deal

As the claims, accusations and counter claims bounce back and forth across the Channel this week between David Frost and M Barnier in advance of what is likely to be the final round of talks, at least in advance of an intervention by the Prime Minister with VDL, take comfort in considering that it is all just window dressing and that no-deal is now pretty much inevitable. As John Keiger writes in the Speccie

After Britain’s chief negotiator’s broadside of a letter a few weeks ago on the need for the EU negotiators to get real, David Frost added a further nail to the negotiation's coffin. On 27 May, he announced that a fishing deal with the EU would be ‘very difficult’. But in reality, each Brexit negotiator is merely going through the motions. The pointilliste dots of individual decisions made elsewhere clearly paint a no-deal Brexit picture.

Keiger lists the manifold factors that predicate against a deal. Liability for the EU €750bn bailout, markets so distorted by state-aid that the EU playing field now has the slope and contours of a Welsh village rugby pitch and the fact that business has already decided that a no-deal outcome is the one for which to plan. Not only is Nissan deserting Spain for the UK but the company may close their Renault plant in France also, and bring Micra production back to the UK. Macron, having just bunged Renault €5bn, is not happy.

Over the weekend we have had the opening salvos, summarised effectively by the Daily Express. First an 'ultimatum' from M Barnier that he will walk away from talks if the UK doesn't back down on our red lines, then our chaps saying the EU was being unrealistic. This public bombast will continue. In the past we've allowed the French to do all the histrionic shouting, considering somehow that it was beneath us, but a new age under Boris has brought a touch of the Twickenham bleachers to our approach, and we now shout back. If Keiger is right, it's actually about establishing in advance who is to blame. Not us.

Four weeks to go. The pressure of the global corporates and foreign interests on the UK press and media will continue. They're not helped by the tsunami of QE that is artificially inflating asset prices like the skin of  a Peking duck; once the air has been let out, there is actually very little flesh on those sparse bones, but today it's hard to argue that it's the prospect of a no-deal that is depressing share prices.

There remains a flash of amusement in the pro-globalist publicity offensive. In the Telegraph, which has bled readers as the Barclay Brothers have abandoned their pro-Brexit stance, it's Jeremy Warner who is today the prophet of gloom and despondency. I'm eagerly anticipating AEP's first ever bouncy and optimistic take on our economic prospects.

Michael Gove runs a tight ship

More of a placemark than a post this morning; I'm sure we will all need to find these documents quickly over the next few weeks as the activities of the Brexit saboteurs rises to a crescendo.

The focus, clarity and process of the talks is a tribute both to Michael Gove and David Frost. What a change from dreary May's demented bungling, and the idiocy displayed by Oliver Robbins.

David Frost's letter to M. Barnier (.pdf)

Draft agreement on Fisheries (.pdf)

Draft Trade agreement (.pdf)

Frost's letter is a model of reasonableness, and recognises that poor M. Barnier has been given an impossible brief by his principals. It also sets out the UK's position to the rest of the world and makes it very difficult for the EU to deploy their usual threat and pressure tactics of smear and confected outrage. It is a well-constructed attempt for the UK to take the moral high ground, and to my mind succeeds admirably.

We will all have learned that all successful negotiations always allow both sides to claim some gains, and I suspect that for the EU these will be tariffs. France, the biggest global consumer of Scotch whisky, may pressure the EU to penalise her own drinkers in a fit of pique. But I'm sure we'll get over it - too much and we boycott EU goods in the UK, which is the last thing that German carmakers want.

Over to you, M. Barnier.

Update
======
M. Barnier responds to Frost - "I don't like your tone, my man" - but no rebuttal of UK's fisheries position other than "consequences - we will punish you". Twitter comments include "Lord North all over". Judge for yourselves

Barnier response to UK

The final round of EU trade talks - sham ECJ crippled.

I have long claimed here that the ECJ was named in the same way as Orwell's Ministry of Truth. It is the EU's political court, and has taken on the mantle of bending the law to facilitate ever closer union, to achieve a federal European state. It has as little to do with pursuing justice, equity, right or fair play as Orwell's fictional bureaucracy has with championing veracity. AEP's latest column for the Telegraph does a magnificent job in underlining the institution's failures -

The ECJ merely asserts primacy. The doctrine was invented out of whole cloth in the landmark Costa/ Enel case in 1964. This bootstrap jurisprudence - in essence a bluff - has been indulged and tolerated by member states. Until now.

There is no Treaty basis for EU legal supremacy. Judicial expansionists in the EU legal services unit tried to slip it into the Lisbon Treaty but all they got was a thin Declaration in the annex stating that the “settled law of the Court” has primacy over national law.

The German judges have repeatedly objected to judicial activism by the ECJ, thunderously denouncing its misuse of the Charter to extend its power. Their finger has been on the trigger. Finally they pulled it. The implicit has suddenly become explicit.

AEP, who has successfully predicted twelve of the last three recessions, is not sanguine about the effects of this bust up. We are wrong to believe it will be bodged over with the usual Eurofudge, wrong to imagine that the ECB can just carry on with its QE programme. He strongly believes that this time it's a binary choice between Germany's continued membership of the EU and the Euro.

Their mistake was to trust in a popular misunderstanding. For years we have been lectured that 'EU law is superior to national law and supercedes domestic legislation' - true. It was easy for everyone to assume or be led to believe that if EU law was superior to national law, then the EU's court must be superior to national courts - not true. 

Meanwhile, as the penultimate round of talks on an EU trade deal before the June deadline collapsed, with Boris holding firm against the EU didactic stubbornness, we are reminded that there are just six weeks remaining in which an extension can be agreed. Even though the government has made plain that no extension will be sought or accepted, this won't stop the entire forces of Remain and #FBPE idiocy from going flat out.

As the final round of pre-deadline talks start in June, expect hysteria from all the usual quarters, eager for the UK to handicap itself or shackle our laws to their sham-court, just so cruelly exposed as such by the German judges. 

Expect Blair back on the Today programme explaining why an extension is essential, and the MSM to dig-up the crazed fools who were kicked out of the party; Grieve, Soubry, Rory Stewart et al. Oh, and of course Major will rise from his sepulchre to do the same. Plus the gerontocrats from the Lords will croak their protests over inadequate phone lines and PTSD Adonis and 'Howler' Grayling will melt down. Also expect the BBC to put out a Panorama explaining how not extending will cost more lives than the Wuhan virus, and Sky to interview no-one except closet Momentum members. Hey ho. 

Earthquake hits the EU - but wait for the aftershock

The brawl between Germany and the EU over the ECB's QE will be one of the most spectacular fallouts since Maastricht. Get the popcorn out, and draw up a seat. 

Germany's Constitutional Court released a judgement on 5th May which essentially had two legs; that the Federal Government and the Bundestag were at fault in failing to challenge the ECB's PSPP (Public Sector Purchase Programme), and that the ECB had exceeded its authority by delivering the programme. Prior to forming a judgement, the court had referrred the question of the ECB's actions to the ECJ, which of course found that the central bank was not at any fault. The Constitutional court then ripped apart the ratio decidendi of the EU's political court in three tightly argued paragraphs and concluded -

In light of the aforementioned considerations, the Federal Constitutional Court is not bound by the CJEU’s decision but must conduct its own review to determine whether the Eurosystem’s decisions on the adoption and implementation of the PSPP remain within the competences conferred upon it under EU primary law. As these decisions lack sufficient proportionality considerations, they amount to an exceeding of the ECB’s competences.

Well, you can imagine the outrage in Brussels. The EU's political court is quite openly constituted to act to further the political aims of the EU - they don't even try to pretend it's not. The German Constitutional Court is concerned with the most fundamental basis upon which Germany was permitted to function as a nation after the period 1933 - 1945, the Grundgesetz, which set in concrete rules that would prevent the German people ever again repeating the actions of those years. Germany's membership of the EU is explicitly on the basis that the EU cannot legislate anything in contravention of the Grundgesetz - it is inviolable. 

Wolfgang Münchau writes in Marxist daily The Financial Times -

The ECB is, of course, not subject to German law. As an EU institution it answers to the European Court of Justice. But this ruling is binding on the Bundesbank. I doubt that Jens Weidmann, its president, will want to fob off the German judges with a superficial response. The ruling only allows the Germans to take part in the asset purchase programme for another three months unless they find a way to comply. Theoretically, the ECB could proceed without Germany. But I would strongly advise against it because that could precipitate a eurozone break-up.

The EU's political court was also not slow to assert its authority, and released a statement -

In order to ensure that EU law is applied uniformly, the Court of Justice (ECJ) alone ... has jurisdiction to rule that an act of an EU institution is contrary to EU law. Divergences between courts of the member states as to the validity of such acts would indeed be liable to place in jeopardy the unity of the EU legal order and to detract from legal certainty. Like other authorities of the member states, national courts are required to ensure that EU law takes full effect. That is the only way of ensuring the equality of member states in the Union they created.

In other words, the EU is telling Jens Weidmann of the Bundesbank that he should do as the ECJ says, not as his own Constitutional Court instructs him.

This is going to be massive.

Predictable and unpredictable

Just as the EU's manifold and abysmal failures to co-ordinate the 27 nations of the EU during the Wuhan virus crisis are becoming clear to all, the cabal of technocrats continues to act entirely to form. They are dealing with Covid-19 as they deal with everything else - slowly. Agile the EU is not. So it's creep, crawl, a little bit of consensus, iron over the immovable barrier, and a bit more creep and crawl. Sadly, the Wuhan virus moves a lot faster then the EU, and by the time they reach an agreement, the nations of the world will already have found a solution. And of course, as the crumbling behemoth is facing an existential crisis, some official pops up to warn the UK, in relation to the Brexit trade talks, that at this difficult time we must not be irresponsible by refusing to accept the wonderful partnership agreement that the EU has crafted. All this madness from the EU is entirely predictable. 

Likewise the slurry of health fascism embodied in that failed and unfit for purpose pressure group, Public Health England. This is the organisation that counts its biggest health policy triumph as banning smoking on hospital grounds, whilst conveniently ignoring levels of multi-drug resistant TB in London greater than in Iraq, Afghanistan, Sudan and Ethiopia. PHE has not only failed in every respect to prepare for a novel pandemic, it has failed to co-ordinate measures to combat the old ones; our crowded cities are as vulnerable to Cholera, Dysentry, Typhus and parasitic diseases as they were in mid-Victorian times. Now they are actually obstructing efforts to fund a way out of the virus stasis. But it seems that for the most important departments in PHE - those charged with campaigning against alcohol, sugar and fried chicken - it's business as usual. A prize for the first reader to spot the PHE advice warning that drinking alcohol at home during the Wuhan virus crisis should be banned. Again, entirely predictable.

D-list celebrities are finding it hard to break through the new hard mood of national purpose. Several have made efforts to use the crisis for self publicity only to be slapped down with great force by social media (I knew it would be useful some day ..). Even Meghan Markle, who must be throwing tantrums of frustration at her lack of column inches, has become transparent. Her latest wheeze, spending an hour handing out sandwiches in an LA homeless shelter, then having her people 'leak' the story of her 'secret' charity work, has fallen as flat as a damp chapati. Give your money to the NHS, sweetie - it's the only thing that works, as the Duke of Westminster (£12.5m) and Ed Sheeran (£1m) are finding. And Capt. Tom Moore has raised £12m from the little people. All entirely predictable.

Rod Liddle, always a ray of sunlight in the gloom, penned a thoughful piece on the importance of cigarettes during the crisis for the Speccie. He even joked

It is even just about possible that the precise opposite is true, and that smoking conveys a degree of protection against Covid-19, much as it does against Parkinson’s disease, ulcerative colitis, endometrial cancer and possibly skin cancer and thyroid cancer. Though I wouldn’t bet on it.

Well, it may not be such a joke. It seems that ACE2, the protein to which the SARS-CoV-2 virus sticks in the upper respiratory tract in a fresh infection, in impacted by nicotine in a way that enhances resistance to the virus. The evidence is not in the bag as yet, but initial anecdotal evidence about the low incidence of Covid-19 amongst smokers is now being thoroughly tested - and you can bet that the tobacco giants are putting their hands in their pockets to help fund it. Now if it turns out that shares in BAT, Philip Morris, Imperial and Altria are as much marked as winners as Glaxo, that truly would be unpredictable. And if vaping nicotine in offices and public places became an accepted prophylactic against the Wuhan virus, prescribed and funded by the NHS, the increase in apoplexy amongst the nation's health fascists would be a small price to pay.

EU shamefaced over Italy as China rides to the rescue

Back in 2019, lost in the Brexit noise, Italy became the first big EU nation and the first member of the G7 to sign up to China's Belt and Road initiative. China had infuriated Brussels by introducing a strategic development plan to Europe in which they had no hand; China targeted the Mediterranean states, the closest parts of the EU to ships low in the water with Chinese goods. The EU was still squabbling over the interests of the northern EU, Rotterdam and Hamburg, which had the lion's share of Chinese imports. As The Diplomat reported, the China - Italy MoU was comprehensive

... aiming at a strategic partnership covering a broad range of areas such as trade, investment, finance, transportation, logistics, infrastructure, connectivity, sustainable development, mobility and cooperation, also involving third countries. Notably, the area of telecommunications was left out of the agreement.

Well, this week Europe was sharply reminded of that agreement. At a time when France and Germany banned the export of medical equipment to Italy, China rapidly arranged to airfreight millions of masks, gowns, eyeshields, hectolitres of alcohol gel and even respirators, thanking Italy for the care provided to the 300,000 Chinese expats working in northern Italy, and re-committing to the friendship between the two nations. The South China Morning Post reported on a telephone call between the nations' foreign ministers

During the phone call on Tuesday, Wang told Di Maio that China would not forget “the precious support” from Italy when “we were at the hardest moment fighting the epidemic”. “Now, we are willing to stand firmly by the side of the Italian people,” the Chinese foreign minister said.

“Although currently China itself still has great demand for medical materials, we will overcome the difficulties and offer material aid, including face masks, to Italy, and increase exports of materials and equipment to meet Italy’s urgent need,” Wang said. “If the Italian side requires it, China would also like to send medical teams to assist in combating the virus,” he said.

The response of the EU to the challenge has been, at the least, confused. Whilst Richi Sunak yesterday committed £30bn to counter the effects of the virus in the UK, the EU's response has been to protect the banks and the interests of the ECB. A measly €7.5bn has been committed for all 27 EU nations, and Brussels has announced plans to co-ordinate the distribution of medical protective supplies. When it whined to EU nations that health was a national competence, it raised only anger. The EU has been for years acting, setting up organisations, sitting on committees as though it were the European Health Authority - now it's proven to be a hollow pretence.

As AE-P writes in the 'graph, Sunak and Carney have shamed the EU.

The EU’s legalistic spending machinery will limit any fiscal punch and slow the roll out of crisis measures. There are still no eurobonds, no shared budget, and no mutualised pan-eurozone deposit insurance for banks, which leaves vulnerable Italy in the worst of all worlds: deprived of sovereign economic instruments yet without EU fiscal support to compensate.

Chancellor Angela Merkel has warned that 70pc of Germans could be infected but failed to draw the economic conclusions. She spoke of a €25bn EU crisis package - less than 0.2pc of GDP - and but proffered no fiscal emergency spending for Germany itself beyond a trivial €275m for health care. Fiscal stabilisers will have to carry the load.

Italian voters will not easily forget either the actions of France and Germany, or the inaction of the EU. Nor will they forget the assistance given by China at a time when her own people are not past the crisis. I've no doubt that there will be those in Brussels who see Covid-19 as just another 'beneficial crisis' that will allow the Federasts to ratchet up control. This time it may just be a crisis too far.

11/03/20
EU/EEA and the UK	Cases	Deaths
Italy	10149	631
France	1784	33
Spain	1639	35
Germany	1296	2
Netherlands	382	4
United Kingdom	373	6
Sweden	326	0
Norway	277	0
Belgium	267	0
Denmark	264	0
Austria	182	0
Greece	90	0
Iceland	70	0
Czech Republic	63	0
Portugal	41	0
Finland	40	0
Ireland	35	0
Slovenia	31	0
Romania	25	0
Poland	22	0
Croatia	13	0
Estonia	13	0
Hungary	12	0
Latvia	8	0
Luxembourg	7	0
Slovakia	7	0
Bulgaria	4	0
Malta	4	0
Lithuania	3	0
Cyprus	2	0
Liechtenstein	1	0
Total	17430	711

ERT - Still there, still protectionist

Imagine the CBI writ large - a vocal, well-funded pro-remain lobby group for the global corporates, on a European rather on a national scale, and you have the ERT, the European Round Table. The ERT don't just have a lobby presence in Brussels, they're on the inside track. No directive is rubber stamped by the unelected officials unless it's had the nod from the ERT. And no, Brexit has made no difference to UK-HQ'd companies with rotating memberships. Right now, it's the turn of Centrica, Rolls-Royce, Rio Tinto, AstraZeneca, BP and Vodafone.

As I hinted at yesterday, there's a new EU Industrial Strategy due out on March 10th, and the ERT is like a Labrador that's just found a fresh cow pat. In December, the EU already agreed to put €3.2bn of taxpayers' money into an €8bn state-aided vehicle battery scheme, a 'Project of Common European Interest', and the eyes of the EU's defence companies are on stalks anticipating billions of state aid following budget agreement. The Industrial strategy promises not just oodles more state aid for the EU's 'champion' companies, which you bet have already been agreed behind closed doors, but a relaxation on regulation, particularly relating to mergers and acquisitions. No more silly fuss about Alstom and Siemens getting married, no more worry about Europe's consumers or the future of its SMEs.

The ERT's agenda is published here and I won't quote it. Given Michael O'Leary's foul-mouthed whining to the press in recent days, bemoaning the €1.3bn state aid that's already gone to Alitalia, the German state aid that has favoured Lufthansa and the EU approach to competition. It's the sort of grouch one hears at the end of an unsuccessful pitch from the losers. I'm betting Ryan Air is just a tiddler not even worthy of the ERT and EU's consideration for state aid billions. You may note that the Irish company has current orders for 210 Boeing 737 MAX aircraft. The prospect of picking up some of FlyBe's slots may this morning have tempered the profanities, but with Covid-19 grounding passengers, perhaps not. Oh. And the Labrador-coating O'Leary was predicting for the outcome of the Brexit talks? That, I'm guessing, is aimed at nervous investors. My advice - book BA.

04/03/20
Country	Cases	Deaths
Italy	2502	80
France	212	4
Germany	196	0
Spain	151	0
United Kingdom	51	0
Switzerland	37	0
Norway	33	0
Netherlands	28	0
Sweden	24	0
Austria	24	0
Iceland	16	0
Belgium	13	0
San Marino	10	1
Croatia	9	0
Denmark	8	0
Greece	7	0
Finland	7	0
Czech Republic	5	0
Portugal	4	0
Romania	4	0
Ireland	2	0
Estonia	2	0
Latvia	1	0
Andorra	1	0
Poland	1	0
Luxembourg	1	0
Monaco	1	0
Lithuania	1	0
Total	3351	85

EU shoots itself in the foot. Again.

Pushed off the front pages by Covid-19, the EU trade deal talks have ramped up the threat and bluster from across the Channel. The first exclusion to note is that the UK has removed any discussion of defence and security co-operation from a possible agreement. Police and justice matters are included, as is a commitment to co-operation in tackling terrorist threats, but what's missing are the plums the EU wanted.

Even more than an EU army, they want an EU defence industry to rival the big US arms firms. What they have been trying to do is to handicap the UK's ability to use state aid to boost our domestic arms industry by shackling us to EU rules whilst quietly agreeing to drive a bulldozer through state aid rules themselves by sponsoring EU 'champions' in fields including defence development. You can be sure they have already picked half a dozen big EU27 firms for 'boosting'. They wanted our money and expertise, but after their behaviour on Galileo the government have told them to go whistle.

Both military and diplomatic co-operation agreements are out. The UK's position is that we are members of NATO, that EU members should pay their 2% rather than buggering around playing toy soldiers, and that the UK will co-operate on an ad-hoc basis outside of NATO on military and diplomatic matters as and when it suits us. With no silly 'dynamic' agreement governed by the Berlaymont waved in our faces.

The EU's overly risk-averse approach to anything new means that the world's Artificial Intelligence, big data and Biotech investors aren't going to put their post-Covid money into the EU27. Without a single university in the world's top 20 (the UK has 4) there are few centres of research excellence anyway in the EU, and the bloc's restraints and development caution will throw a heavy blanket over innovation and drive the cleverest innovators out of Europe. Some hope of any world-beating defence development coming out of the EU27.

Well, they had their chance. They took advantage of the UK's political weakness under the abysmal Cameron and even more abysmal May and now they must face the consequences.

EU/EEA, the UK, San Marino, Monaco, Switzerland, Andorra 3/3/20
	Cases	Deaths
Italy	1835	52
France	178	3
Germany	157	0
Spain	114	0
United Kingdom	40	0
Switzerland	30	0
Norway	25	0
Netherlands	18	0
Austria	18	0
Sweden	15	0
San Marino	8	1
Belgium	8	0
Croatia	8	0
Greece	7	0
Iceland	6	0
Finland	6	0
Czech Republic	5	0
Denmark	5	0
Romania	3	0
Portugal	2	0
Andorra	1	0
Lithuania	1	0
Monaco	1	0
Latvia	1	0
Ireland	1	0
Estonia	1	0
Luxembourg	1	0
Total	2495	56

PM right to reject EU Trojan Horses

The EU are desperate to retain some measure of control over the UK. In this they are ably assisted by a fifth-column of public service officials in the UK who will lobby fervently for the continuance of democratic anomalies such as the European Arrest Warrant and of membership of such bodies as Europol.

The Telegraph reports today that the PM has rejected a move by Health officials to maintain membership of the EU Early Warning and Response System (EWRS). They were attempting to use Covid-19 as leverage to continue some measure of EU management and control of the UK's health response capacity. We are quite right to reject such Trojan Horse attempts.

Inevitably, such subserviences are unnecessary. We don't need Europol because we're members of Interpol. Interpol allows co-operation in criminal investigation and enforcement between sovereign nations; Europol is the federal police agency of the EU. Big difference.

As with the EWRS. We continue to be part of the health 'Interpol', the WHO, which co-ordinates information sharing, warning dissemination and international funding and assistance. WHO also publishes the international daily case tally for Covid-19. If you want a European perspective, you can look at the EU's ECDPC site. They're not so stupid to publish only the WHO's figures for EU nations or to exclude the UK from lists of emergency contacts and laboratory resources - a virus knows no borders, and European doctors and medical authorities are also quite capable of co-operating with each other without the controlling hand of the EU.

Here is the daily update for 1st March - excluding the 13 new cases yesterday for the UK

EU/EEA, the UK, San Marino, Monaco and Switzerland
	Cases	Deaths
Italy	1128	29
Germany	111	0
France	100	2
Spain	66	0
United Kingdom	23	0
Switzerland	18	0
Norway	15	0
Sweden	13	0
Austria	10	0
Netherlands	7	0
Greece	7	0
Croatia	5	0
Romania	3	0
Denmark	3	0
Finland	3	0
Estonia	1	0
Monaco	1	0
Iceland	1	0
Luxembourg	1	0
Ireland	1	0
Belgium	1	0
San Marino	1	0
Lithuania	1	0
Total	1520	31

Is the EU serious about a deal? And does M Barnier even have a mandate?

As the EU is discovering this week, a trade agreement will need not only the agreement of the unelected Commission and token Parliament, but the explicit consent of the 27, and that means of Belgium's regions. The EU's Canada trade deal, CETA, was concluded in 2014 but because it cannot secure support from first Wallonia and now the Netherlands*, it cannot be concluded. Six years on and it's not yet in force, and looks today unlikely ever to be so. CETA is subject to the fads, whims and grandstanding of every tiny little EU statelet.

So when we consider whether we want a Canada trade deal, we must consider whether we want to conclude a trade deal with the unelected officials in 2020 only to see it still not ratified in 2026. One needs a certain trust in one's negotiating partners that they actually have a remit to negotiate on behalf of their principals, and it's not at all certain that M Barnier enjoys that trust.

So far, Greece has threatened not to ratify the trade deal unless the British Museum given them the Elgin marbles. And France has threatened to end the return of asylum seekers under the Dublin convention. And Sinn Fein is seeking a referendum on Northern Ireland's future.

The first is a risible playground taunt. For the second, we return some 6k migrants under the Dublin agreement and take in 2k (mostly for family reunification) so the EU is threatening us with 4k migrants a year when we have 3.5m EU citizens living here already? Please.

As for Northern Ireland, yes, if the people of the province want a referendum on their future we must grant it, and we must abide by their decision. However, it's far from sure whether either the citizens of the province or the Republic of Ireland would be keen. First, finance. Northern Ireland costs the UK about £10bn more each year than it raises in tax - not far short of the £13bn we paid each year to the EU. If Ireland is to keep the same levels of welfare and public services there as now, it will be a painful cost. Ireland currently has a GDP of around £75bn and taxes are just under 24% of GDP. Irish taxes would have to rise to 37% of GDP to pay for the North. I suspect that's why NI polls show that just 25% favour unification with the Republic with 52% opposing.The levels of austerity they would need to endure would be destructive.

Ireland's low tax rate is significant. The EU is asking its members to tax their people more to both make up for Brexit and pay for other aspirations - but the effects of tax increases to pay for the Berlaymont's trillion Euro goggle eyes (we've just punched a €94m hole in that) impact the people of Europe very differently. Ireland has an overall tax rate of 23.5% of GNI, France 48.4%.
  

		% of GNI subvented by EU
	Tax rate	1.00%	1.10%	1.20%	1.30%
Ireland	23.5	4.3%	4.7%	5.1%	5.5%
Romania	25.8	3.9%	4.3%	4.7%	5.0%
Spain	34.5	2.9%	3.2%	3.5%	3.8%
Netherlands	39.2	2.6%	2.8%	3.1%	3.3%
Germany	40.5	2.5%	2.7%	3.0%	3.2%
Italy	42.4	2.4%	2.6%	2.8%	3.1%
Austria	42.4	2.4%	2.6%	2.8%	3.1%
Sweden	44.9	2.2%	2.4%	2.7%	2.9%
Denmark	46.5	2.2%	2.4%	2.6%	2.8%
Belgium	47.3	2.1%	2.3%	2.5%	2.7%
France	48.4	2.1%	2.3%	2.5%	2.7%

Increasing the EU's annual charge to its members from 1.0% of GNI to 1.3% of GNI doesn't sound much - but for an Irishman it means the proportion of his tax going to Brussels rises by 1.2%, whilst a Frenchman can shrug off a 0.6% increase.

Hey ho.

*CETA passed the Dutch lower chamber yesterday, but is due to go to the Tweede Kamer next month, where it is likely to fall. Incidentally, the best hashish in A'dam could be bought from a tiny place for locals, very non tourist, called Der Tweede Kamer on the Spui. In my youth I spent many happy hours there, and it's still there today.