News Article | May 14, 2017
Ten years ago this month, Britain was on the cusp of change. Two things were about to happen, one planned and one unexpected. The change everybody knew about was that Tony Blair was going to stand down as prime minister after 10 years in the job, during which time he had won three elections on the trot. To mark his going, Dan Atkinson and I wrote a book summing up his legacy. Fantasy Island, as the title suggests, was not exactly flattering about Britain’s departing PM. It painted a picture of Britain as mired in debt, where the public sector was on the brink of meltdown, where the country was trying to play the part of world policeman on the cheap, and where the growing size of the trade deficit exposed the perils of allowing manufacturing to shrivel. Fantasy Island was not exactly a bestseller but it sold reasonably well. The reason for that (apart, obviously, from the book’s razor-sharp analysis and polished prose) was that the biggest financial crisis in a century erupted within two months of its publication and a month after Blair’s departure from Downing Street. This was the unexpected event. Britain, as a result of what happened between the first inklings of trouble in July 2007 and the bottoming out of a deep slump in the early part of 2009, is an utterly changed country. There has been a lost decade of living standards. Dismal productivity growth and the proliferation of low-paid, insecure jobs have made a mockery of the idea that Britain was forging ahead in the knowledge economy. A decade of investment in the public sector has been followed by a decade of cuts. Without sounding unduly boastful, quite a lot of what was predicted in Fantasy Island came true. And, to be frank, not a lot has changed in the subsequent 10 years. The economy is still over-dependent on the financial sector and on the willingness of households to load up on debt. When the housing market slows – as in 2011-12 and currently – so does the economy. Income and wealth are highly concentrated because not only has growth been slow it has also been unevenly distributed. In the workplace, management is strong and unions are weak, which helps explain why real wages have grown more slowly since 2007 than in any decade since the 19th Century. London is rich and thriving but might as well be a separate country given how different it is from other, less prosperous, regions. Relative poverty, as the former prime minister Gordon Brown has shown, is heading for levels not experienced even under Margaret Thatcher in the 1980s. Imperfect though it is, Labour’s draft manifesto at least tries to tackle some of these glaring weaknesses. Sure, there is a perhaps naive belief in the ability of the state to administer top-down solutions. Certainly, the document can – and will – be criticised for being stronger on how to spend money than how to create it. No question, some of the individual measures don’t really cut it. The £8bn bung to scrap tuition fees, for example, is not especially progressive. That said, though, there are plenty of good things in the manifesto. The employers who whinge constantly about the poor quality of school leavers and graduates will be asked to contribute more to the education budget through higher corporation tax. Labour plans to broaden stamp duty to a wider range of financial instruments, including derivatives, which will raise £5bn and help lessen volatility. There is a recognition that macro-economic policy since the crisis has been flawed, with far too much emphasis on ultra-low interest rates and quantitative easing and too little on tax and spending measures. Austerity has been tested to destruction, with both deficit reduction and growth much weaker than envisaged. There is a strong case, as the International Monetary Fund has noted, for countries to borrow to invest in infrastructure, especially when they can do so at today’s low interest rates. Indeed, it is sign of how much ground has been ceded by the left over the last decade that these ideas are seen as dangerously radical. Germany and France have higher levels of corporation tax than Britain, but they also have better trained workforces and higher levels of productivity. A group of eurozone countries are planning a financial transactions tax. Balancing day-to-day spending while borrowing for roads, railways and superfast broadband, which is what John McDonnell is suggesting, is more Keynesian than Marxist. What’s more, these essentially social-democratic ideas will seem even more mainstream if – as is entirely possible – there is another crisis. Mohammed El-Erian used to run Pimco, the world’s biggest fund manager. He told the Observer this week that in 2008-09 there was a chance to construct a new growth model, but the opportunity was passed up. Financial markets have been kept happy by an unceasing diet of cheap money but the economic fundamentals are poor. Brexit, the election of Donald Trump and the eclipse of both the traditional parties of government in the French presidential election are warning signs that something is seriously amiss. El-Erian says the developed world is “either going to take a turn towards higher, more inclusive growth that will reduce political polarisation and the politics of anger. Or alternatively, low growth becomes recession, artificial financial stability becomes unsettling volatility, and the politics get a lot messier”. Things, in other words, are back where they were in the run-up to the crash of 2007-08. Then, the series of regional financial crises in Mexico, south-east Asia, Russia, and Latin America were warnings that something bigger and much more serious was about to happen. These were akin to someone who is obese and a heavy smoker suffering a series of mini strokes and failing to change their lifestyle. The leak of Labour’s draft manifesto led to some predictable headlines – “Britain heading back to the 1970s”; “This was the most expensive suicide note in history”. For me, though the most memorable given its personal connotations, was the Daily Mail’s “Corbyn’s fantasy land”. Think about this for a moment. Real incomes are falling. Inequality is rising. The NHS is kept going on a wing and a prayer. The economy is barely rising despite more than eight years of unprecedented stimulus from the Bank of England. Personal debt is heading back towards its previous record levels. International co-operation has rarely been weaker. There is a profound disconnect between the financial markets, where asset prices regularly scale new heights, and the state of the real economy. Now ask yourself this. If any of the above rings true, what is the real fantasy: Labour’s idea that income, wealth and power should be a bit more evenly distributed or the idea that the current state of affairs can be sustained for very much longer?
News Article | May 14, 2017
The chancellor, Philip Hammond, has called for closer economic ties with China as Britain enters a new, post-Brexit era. Speaking at the start of a summit in Beijing celebrating President Xi Jinping’s “Belt and Road initiative”, Hammond heaped praise on his hosts and said Britain was a “natural partner” for Beijing as it pushed ahead with a massive infrastructure campaign some call the most ambitious in history. “China and the UK have a long and rich trading history. Indeed, the English first attempted to find a trade route to China in the 16th century although it took us four decades to find one,” Hammond told the opening session of the two-day forum. “I welcome the ‘Belt and Road initiative’ as an opportunity to strengthen these ties and I welcome the progress that has already been made.” Relations between London and Beijing soured after Theresa May became prime minister in July and ordered a review of the controversial China-backed Hinkley Point C plant. That decision cast doubt on what had previously been cast as a “golden age” of ties under her predecessor David Cameron and former chancellor George Osborne. But the relationship appeared to recover after the £18bn project was approved. On Sunday Hammond hailed China’s ability to drive “phenomenal economic development” and success in “lifting” 800 million Chinese citizens out of poverty over the past four decades. “Since 1980 the Chinese economy has grown by over 2,500%. This year, it is expected to account for a quarter of total global economic growth,” he told an audience of world leaders including Russian president Vladimir Putin, and Turkey’s Recep Erdoğan. Britain now hoped to benefit from that growth as it charted its post-Brexit course, the chancellor added. “As we embark on a new chapter in our history, as we leave the European Union, we want to maintain a close and open trading partnership with our European neighbours and at the same time pursue our ambition to secure free trade agreements around the world with new partners and old allies alike.” “Our ambition is for more trade, not less trade, and China clearly shares this ambition,” Hammond added. The chancellor said that between now and 2030 about $26tn would need to be spent on infrastructure in Asia - $4tn of which China had pledged to help fund. “But the scale of infrastructure investment required cannot be met by public financing alone and the UK, I believe, can be a natural partner in delivering this infrastructure by supporting the finance, the design and the delivery needed to make the vision a reality.” Liu Xiaoming, China’s ambassador in London, said that while Brexit and next month’s general election had brought “uncertainties”, Downing Street was now “in an excellent position to secure the opportunities [Xi’s] initiative has to offer”. “Remarkable opportunities … are now up for grabs,” Liu told Xinhua, China’s official news agency. Hammond added on Twitter: “Britain is ready to work with all [Belt and Road] partners.”
News Article | May 8, 2017
Facebook has stepped up attempts to build its influence as a political tool by giving jobs to former senior Conservative and Labour campaign officials. The Guardian has learned Facebook’s recruits have inside knowledge of how the major parties’ general election campaigns are likely to work. They include a former Downing Street adviser to David Cameron, a former aide to Ed Balls and a social media expert who worked with the Conservatives’ election strategist Lynton Crosby. On Monday, the company confirmed it employed staff, “whose role it is to help politicians and governments make good use of Facebook”. Campaign strategists for both Donald Trump and the Leave.EU campaign have said that reaching voters on Facebook has become pivotal to election success. Both Labour and the Conservatives have teams dedicated to targeted Facebook advertising and are thought to be preparing to hand the San Francisco company well over £1m in the coming weeks. There has been growing concern about the ability of politicians to track the interests of Facebook users in order to “micro-target” voters. There are 31m registered Facebook accounts in the UK. The Electoral Commission is investigating whether Leave.EU failed to declare spending or support from Cambridge Analytica, a Washington-based company that claims to be able to target voters based on psychometric profiling gleaned from their social media activity. Leave.EU denies any wrongdoing. Facebook’s policy and politics teams include Rishi Saha, a former head of digital communications at Downing Street; Karim Palant, a former chief policy adviser to Balls, Labour’s shadow chancellor; and Theo Lomas, a former political consultant for Crosby Textor, the PR firm of the man running the Tories’ 2017 general election campaign. “They have created these links into the campaigns so they can whisper in the parties’ ears, say ‘we know what you need, why don’t you come and spend some money with us’,” claimed a source with knowledge of the strategy. “Their job is to persuade political campaigns to use Facebook.” During the 2015 general election campaign, the Conservatives spent more than £1m on Facebook advertising; Labour sources have indicated they are prepared to spend a similar amount in the coming weeks. Lomas works for Facebook’s government and politics team, which helps parties and MPs use Facebook. Saha and Palant are in the policy team. According to a recent job description, the duties of Facebook UK’s head of policy include “responding to queries from politicians … about how to use the Facebook platform” and “actively promot[ing] the uses of Facebook with policymakers and influencers in both electoral and governing bodies”. Saha helped Cameron “detoxify” the Conservative brand from as early as 2005, and worked on the 2010 election campaign before becoming No 10’s head of digital communications. He joined Facebook in 2014. Craig Elder, the Conservatives’ current social media campaign consultant, used to work for Saha at party HQ. Facebook declined to comment in detail on the roles of the former party aides. But speaking to BBC1’s Panorama on Monday, Simon Milner, Facebook UK’s head of policy, confirmed the company’s staff worked closely with political parties. “One of the things we are absolutely there to do is to help people make use of Facebook products,” he said, in a programme that explored how political campaigns capitalise on Facebook users’ personal information. Referring to Hillary Clinton and Donald Trump’s US presidential election campaigns, Milner said: “I can’t give you the number of exactly how many people worked with these campaigns. But I can tell you that it was completely demand-driven, so it was really up to the campaigns.” Gerry Gunster, an American strategist who worked for Leave.EU during last year’s Brexit referendum campaign, told Panaroma that Facebook was “a game-changer”. “You can say to Facebook, I would like to make sure that I can micro-target fishermen in certain parts of the UK so that they are specifically hearing that if you vote to leave that you will be able to change the way that the regulations are set for the fishing industry. Now I can do the exact same thing for people who live in the Midlands, who are struggling because the factory has shut down. So I may send a specific message through Facebook to them that nobody else sees.” Political parties have huge lists of email addresses, telephone numbers and Facebook IDs that they can use to target Facebook users with bespoke messages. One digital campaigner told the Guardian that the main parties and other pressure groups, such as the Taxpayers Alliance and 38 Degrees, are likely to have the details of around 10 million UK voters. “This is where you can do the interesting stuff,” said the campaigner, who wished to remain anonymous. “You are not just advertising to them once; if they click, you know a specific person has shown an interest. You can feed that back and know who and where they are, down to the postcode. Then you can change the messaging to suit what you need politically.” Parties can also target opposition supporters by buying data that indicates party affiliation. In 2015, Jim Messina, the former Barack Obama strategist turned Conservative adviser, masterminded a micro-targeting campaign in the south-west of England that contributed to wiping out the Liberal Democrats in the region.
News Article | May 13, 2017
London (AFP) - The European Union could end up paying a Brexit bill to Britain instead of the other way round, British Foreign Secretary Boris Johnson told The Daily Telegraph in an interview on Saturday. Asked if he believed that Britain might end up receiving a payment, Johnson replied: "I do, I think there are very good arguments". "There are assets that we share, that we have paid for over the years and there will need to be a proper computation of the value of those assets," said Johnson, one of the leading lights in last year's Brexit referendum campaign. Johnson dismissed as "absurd" the various estimates for the exit fee that would have to be paid by Britain, which some reports have said could be as high as 100 billion euros ($109 billion). "They are going to try to bleed this country white with their bill," he said, threatening that Britain could "definitely" walk away from the negotiations without paying anything. The payments that London must make to settle financial commitments made when it was a member are considered one of the most difficult Brexit issues and are a top priority for the talks. A report in the Telegraph earlier this week said British officials estimated that Britain was entitled to Â£9 billion ($11.6 billion, 10.6 billion euros) in funds held by the European Investment Bank and Â£14 billion of other EU assets including property and cash. Johnson also criticised the "shameful" leaking of details of a meeting in Downing Street last month between Prime Minister Theresa May and European Commission president Jean-Claude Juncker. "Brussels is ruthless in its negotiating techniques. They are going to play dirty. We have got to be very wary and intellectually very firm," the former London mayor said. Quoting the famous Eagles hit, he added: "Jean-Claude Juncker thinks it's the Hotel California where you can check out but you can never leave. He is wrong." Tensions between Brussels and London have risen in the run-up to Britain's general election on June 8, with the government accusing EU officials of "meddling" in the election campaign.
News Article | May 7, 2017
PARIS (AP) — The latest on France's presidential runoff Sunday between centrist Emmanuel Macron and far-right candidate Marine Le Pen (all times local): The Paris 2024 Olympic bid committee is welcoming the election of pro-business Emmanuel Macron as France's new president, after concerns that a win for his populist rival Marine Le Pen could have damaged the bid. Paris and Los Angeles are the only cities left competing for the 2024 Olympics, and a decision will be made in September. Paris bid committee co-chairmen Tony Estanguet and Bernard Lapasset say in a Sunday statement that Macron "understands the power of sport and how the Games can be a force for real change and help build inspiration and inclusion." Australia's prime minister has congratulated French president-elect Emmanuel Macron on what he described as an "historic election win." Prime Minister Malcolm Turnbull tweeted on Sunday: "We will build even stronger ties between our two great nations." Scattered groups of masked protesters have clashed with police firing tear gas in eastern Paris after the election of pro-business independent Emmanuel Macron as France's new president. About 100 protesters are dodging police in mobile protests through neighborhoods near the Pere Lachaise cemetery. Police are checking documents and detaining some protesters. During the presidential campaign, many groups held protests against Macron's far-right rival Marine Le Pen. Some anarchist and far-left groups also held occasionally violent protests against both candidates, seeing Macron as too business-friendly and Le Pen as tainted by her party's racist past. French president-elect Emmanuel Macron's inauguration will be held by the end of the coming week at the Elysee palace. But the exact date hasn't yet been set. The ceremony must be scheduled before the formal end of the term of Socialist President Francois Hollande on May 14. Macron will attend his first official event as president-elect on Monday by Hollande's side at the commemoration of World War II Victory Day. The Constitutional Council will declare the definitive results of the vote by Thursday. Once president, Macron will have to quickly designate a prime minister and form a government. The whole process usually takes no more than a few days. French far-right leader Marine Le Pen's National Front party will be changing its name. Le Pen said in her presidential concession speech Sunday night that she would make "deep" changes to her party, and interim party president Steeve Briois told The Associated Press that would include a new name. He said "It's opening the doors of the movement to other personalities then give it a new name to restart on a new basis." He called the election result a "semi-victory" because the party won more votes than ever before. There has long been internal talk of changing the name of the party but that felt too radical for some National Front militants. A name change would help Le Pen further distance herself from the party's anti-Semitic past and her hard-line father, party founder Jean-Marie Le Pen. Greece's prime minister has tweeted his satisfaction over French centrist Emmanuel Macron's victory in France's presidential election. Alexis Tsipras says that Macron's "victory is a fresh breath for France and the whole of Europe. I am certain we will work closely together for Europe to change course, inspire its people again so as to never again experience the nightmare of the extreme right." Macron beat far-right leader Marine Le Pen in Sunday's runoff. Tsipras had called Macron to congratulate him after the first-round results on April 23. French president-elect Emmanuel Macron says that France is facing an "immense task" to rebuild European unity, fix the economy and ensure security against extremist threats. Speaking to thousands of supporters from the Louvre Museum's courtyard, Macron said Sunday night that Europe and the world are "watching us" and "waiting for us to defend the spirit of the Enlightenment, threatened in so many places." Macron, who has never held public office and just founded his political movement a year ago, said "everyone said it was impossible. But they didn't know France!" Macron strongly beat far-right leader Marine Le Pen in Sunday's runoff election, seen as a test for Europe's direction and global populism. He also promised to work to unify France after a bruising presidential campaign and serve the country "with love." His wife Brigitte then came up on stage with him, and she kissed his hand and waved to the crowd. The leaders of Czech Republic and Slovakia have welcomed French centrist Emmanuel Macron's victory in the presidential election. Czech Prime Minister Bohuslav Sobotka says that Macron's win is a "positive signal for France, the entire European Union and the Czech Republic." Sobotka says that the French people "made it clear they reject nationalism, populism, and the isolation of their country. Most voters decided that they want a president who will represent a modern and open France." Slovak President Andrej Kiska tweeted: "Warm congratulations to Emmanuel Macron and to the people of France." Kiska says it's a "victory for all who believe in Europe." Slovak Foreign Minister Miroslav Lajcak says he was "delighted to learn of Emmanuel Macron's victory." Dutch Prime Minister Mark Rutte, who won an election in March against opponents including right-wing populist Geert Wilders, has congratulated Emmanuel Macron on his victory in France's presidential election. Rutte said in a post on his official Facebook page that in Macron, French voters "made a clear progressive and pro-European choice." He said that "a choice for cooperation within Europe in areas where that is necessary, instead of an inward-looking vision." In a tweet Sunday night, Dutch Foreign Affairs Minister Bert Koenders said that "France chooses for reform, for Europe and against xenophobia. We look forward to working together with the new French government." Macron, a centrist, is a strong supporter of France's continued membership in the EU. He beat far-right candidate Marine Le Pen in Sunday's runoff. Rutte is still negotiating with the leaders of three other parties to form a new ruling coalition after the March election delivered a fractured Dutch political landscape. Spanish Prime Minister Mariano Rajoy says France, with Emmanuel Macron as its new president, will help strengthen the European Union at a key moment for the 28-nation bloc. In a telegram sent Sunday to congratulate the new president-elect of France, Rajoy praised Macron for his proposed reforms and his "firm defense of the European integration process." Those principles and his solid backing from French voters, Rajoy said, mean "France — a friend, neighbor and strategic partner of Spain — will actively contribute to the advancement and reinforcement of the European Union in a key moment of its history." German Chancellor Angela Merkel's spokesman says she has called Emmanuel Macron to congratulate him on his victory in the French presidential election. Spokesman Steffen Seibert said Merkel "praised his stance for a united and open European Union during the campaign" and that "the decision of the French voters is a clear statement of support for Europe." Seibert's statement said Merkel "looked forward to working together with the new president on the basis of trust in the spirit of the traditional German-French friendship." Macron, 39, trounced far-right rival Marine Le Pen in Sunday's presidential runoff, winning a projected 65 percent of the vote. Stock markets and the shared euro currency are expected to rise on news that centrist Emmanuel Macron has won the French presidential election. Jacob Kirkegaard, senior fellow at the Peterson Institute for International Economics, says "there will be a relief rally in Europe ... this is certainly positive for the European economy." The euro will start trading late Sunday European time, alongside Asian markets. European stock markets will open Monday morning. Kirkegaard said shares in financial firms in particular are likely to gain as they stood to suffer the most from a possible French exit from the European Union, as proposed by Macron's defeated far-right rival, Marine Le Pen. Paul Christopher, head global market strategist for Wells Fargo Investment Institute, said "Europe dodges a bullet here." Germany's foreign minister is urging support for Emmanuel Macron and his efforts to create jobs and reform France's economy. Sigmar Gabriel said that Macron "must succeed, if he fails, in five years Mrs. Le Pen will be president and the European project will go to the dogs." Gabriel said it was time to give up "budget orthodoxy" based on spending restraint and that if France embarks on reforms it "should not be forced into austerity." As a member of the euro currency France is subject to European Union limits on debt and deficits. Britain's opposition Labour Party leader Jeremy Corbyn has expressed his relief at the defeat of far-right Marine Le Pen in the French presidential election. Corbyn tweeted Sunday that he was "delighted that the French people have decisively rejected Le Pen's politics of hate." French centrist candidate Emmanuel Macron defeated Le Pen by a big margin. The former leader of the UK Independence Party, Nigel Farage, meanwhile, has offered his condolences to Le Pen, saying she could win France's next election in 2022. Farage, who led the effort to take Britain out of the European Union, tweeted that Macron "offers 5 more years of failure, power to the EU and open borders." Although he no longer heads UKIP, Farage remains a figurehead for nationalist parties in Europe. Belgium's prime minister has welcomed the election of centrist Emmanuel Macron as French president and invited him to join in the effort to reinvigorate the European Union. Charles Michel has been a staunch backer of Macron in the elections and said in a twitter message "Bravo" when he learned of the clear-cut victory over extreme-right candidate Marine Le Pen. Michel has called on Macron to "let us work together to give Europe new momentum." President Donald Trump has tweeted his congratulations to Emmanuel Macron on what Trump is calling Macron's "big win" in France's presidential election. Trump also says he looks forward to working with France's new leader. He didn't immediately extend an invitation for Macron to visit the White House. Trump tweeted: "Congratulations to Emmanuel Macron on his big win today as the next President of France. I look very much forward to working with him." A White House statement cited Macron and the French people for "their successful presidential election" and said the United States looks forward to "continuing our close relationship with the French government." Several British politicians have congratulated Emmanuel Macron on his victory in the French presidential election. Scotland's First Minister Nicola Sturgeon tweeted "Vive La France (Long live France). Congratulations to new president, Emmanuel Macron, on his decisive victory over the hard right." Sturgeon leads the Scottish National Party, which supports independence for Scotland and its continued membership in the European Union. Macron, a centrist, has long backed France's continued membership in the EU. He beat far-right candidate Marine Le Pen in Sunday's runoff. Tim Farron, leader of Britain's Liberal Democrats, says that "Emmanuel Macron has kept the wolves from our door, but we must never be complacent in the fight against racism, fascism and the far right." Farron added that "this is not just a victory for France, but a victory for Britain and the liberal values we hold dear." France's president-elect Emmanuel Macron acknowledged divisions in society he says drove people to "vote to the extreme" and says he will work for all of France. Macron, whose far-right opponent Marine Le Pen had called for leaving the European Union and returning France to the franc currency, says that he will defend both France and Europe as president. The 39-year-old former banker, who served as economy minister under the unpopular President Francois Hollande, briefly acknowledged his onetime mentor. But not once cracking a smile in the short speech, Macron says that he needed to look forward for the sake all of France. It was less a victory speech than one of acknowledgement of the task ahead for Macron, who was projected to win 65 percent of votes cast for a candidate, compared with 35 percent for Le Pen. The head of the European Union's executive has congratulated Emmanuel Macron on his election as French president and says that his pro-European message will continue to be that of founding nation France. European Commission President Jean-Claude Juncker says that it made him "happy that the ideas that you defended of a strong and progressive Europe that protects all its citizens will be those that France will cherish under your presidency." Juncker had already shown his clear support for Macron after the first round in the elections and insisted that a win Marine Le Pen would have been bad for the EU and France alike. German Chancellor Angela Merkel's chief of staff has congratulated Emmanuel Macron, tweeting in French "vive la France, Vive L'Europe!" or "Long live France, long live Europe!" Peter Altmaier says the result is "a strong signal for our common values." Merkel's chief spokesman, Steffen Seibert, also has tweeted in French "felicitations," or congratulations. He says it's "a victory for a strong and united Europe." Before the results came in, Foreign Minister Sigmar Gabriel, a Social Democrat, urged support for Macron in his efforts to create jobs and undermine support for the National Front party's nationalist approach under far-right leader Marine Le Pen. Gabriel said that a Macron victory means that "we have only won time. We must do everything to see that Macron succeeds." British Prime Minister Theresa May has offered her warm wishes to France's new president-elect, saying she welcomes a chance to work with Emmanuel Macron. May's Downing Street office says that she "warmly congratulates President-elect Macron on his election success." In comments released immediately after exit polls showed Macron's victory, May said that France is one of Britain's closest allies and "we look forward to working with the new president on a wide range of shared priorities." France will be a key player in upcoming talks on Britain's departure from the European Union. Thousands of supporters of French centrist candidate Emmanuel Macron have let out a big cheer when national television called the presidential election in his favor based on poll projections. Macron's backers are singing "we have won, we have won" and are waving French flags in front of the stage in the courtyard outside the Louvre museum where he is planning to celebrate his victory. Many expressed their relief that far-right candidate Marine Le Pen suffered a clear defeat. Sandra Ledoux, a 32-year-old Macron supporter, says that she feels "very happy because Macron is young, innovative and he has a project to make Europe better instead of destroying it like Le Pen wanted." French President Francois Hollande says that he has called centrist candidate Emmanuel Macron to congratulate him on his election victory. Hollande says it shows that the overwhelming majority of voters rallied behind the European Union and openness to the world. It was Hollande who first brought Macron into the world of politics, naming the untested ex-banker as economy minister. But Macron left the position to found his own political movement last year, and has distanced himself from his former mentor. With nearly 20 percent of the votes counted, Macron had 60 percent of the vote to 40 percent for far-right candidate Marine Le Pen, according to the Interior Ministry. The early results are primarily from provincial towns that lean more conservative than the cities, whose votes are counted later. French far-right leader Marine Le Pen says she has called centrist Emmanuel Macron to congratulate him and says the vote confirms her National Front party and its allies as the leader of France's opposition. Minutes after the first results were released, Le Pen said she would call for a new political force as legislative elections loom in June. Le Pen received 35 percent of the votes cast for a candidate, according to polling agency projections, compared with 65 percent for Macron. She hinted that her party may rename itself from the National Front, which has been dogged by allegations of racism and anti-Semitism since it was founded by her father. France's prime minister says that centrist candidate Emmanuel Macron has won the French presidential election. Bernard Cazeneuve said in a statement minutes after the last polls closed that the vote "testifies to the lucidity of the voters who rejected the deadly project of the extreme right." He said the vote shows an embrace of the European Union. French polling agencies have projected that Macron has defeated Marine Le Pen 65 percent to 35 percent, with a record number of blank and spoiled ballots. Polling agencies have projected that centrist Emmanuel Macron will be France's next president, putting a 39-year-old political novice at the helm of one of the world's biggest economies and slowing a global populist wave. The agencies projected that Macron defeated far-right leader Marine Le Pen 65 percent to 35 percent on Sunday. If confirmed, Le Pen's showing would nonetheless be stronger than her National Front party has seen in its 45-year history. The projections are based on vote counts in selected constituencies, then extrapolated nationwide. Macron would be the youngest French president ever. But Le Pen's projected showing, unusually low turnout and the record number of blank ballots are an indication of the headwinds facing Macron, a former economy minister who started his own political movement only a year ago. Supporters of French presidential candidate Emmanuel Macron are entering the courtyard outside the Louvre museum in Paris where he plans to celebrate election night. Late Sunday afternoon, French police emptied the place of tourists. Police dogs searched the site. Hundreds of Macron supporters were waiting quietly outside barriers to pass security checks, while Macron's volunteer staffers were handing them French tricolor flags. Earlier in the day, the courtyard was briefly evacuated after a suspicious bag was discovered. The famous museum itself was not evacuated or closed. Macron, a centrist, is running against far-right Marine Le Pen in the presidential runoff. If elected as France's next president, he plans to speak on the stage with the museum's large glass pyramid in the background. The Paris prosecutors' office says it has launched an investigation following the hacking attack targeting presidential candidate Emmanuel Macron. France's election campaign commission said Saturday that "a significant amount of data" — and some fake information — was leaked on social networks following the hacking attack on Macron. The leaked documents appeared largely mundane, and the perpetrators remain unknown. The commission urged French media and citizens not to relay the documents. Earlier this week, Paris prosecutors launched a separate investigation into whether fake news was being used to influence voting in Sunday's presidential runoff. Macron's campaign filed suit against an unknown source "X'' after his far-right rival Marine Le Pen suggested on television that the former banker could have an offshore account. Macron denies having any such account. Voter turnout in France's presidential runoff is above 65 percent in late afternoon, a sharp drop of more than 6 percent compared to the last presidential vote. The Interior Ministry announced Sunday the turnout had reached 65.3 percent, compared to 71.96 percent in the second round of presidential voting in 2012. Going into Sunday's runoff, centrist candidate Emmanuel Macron had a large polling lead over far-right rival Marine Le Pen. The last polling stations in France close at 8 p.m. (1800 GMT) and partial results are expected shortly afterward. A brief election-day security scare at the Louvre Museum in Paris has barely ruffled tourists and locals. Russian tourist Ksenia Simonova told The Associated Press "there is no more of a security problem in Paris than elsewhere. I come from Moscow and the risk is the same. There are a lot of police officers here. I am not afraid." Frenchman Eric Kadio came to the park near the Louvre in hopes of seeing presidential candidate Emmanuel Macron, who's expected to speak to supporters from the Louvre courtyard after election results come in later Sunday. Kadio says "France has an efficient security operation. I am not afraid. Bomb scares are frequent and each time they get things under control." Police evacuated the Louvre courtyard Sunday because of a suspicious bag but later reopened it. If he defeats Marine Le Pen in France's runoff election, 39-year-old Emmanuel Macron will become the country's youngest president of all time, erasing Louis Napoleon Bonaparte's record. After the 1848 French Revolution and the proclamation of France's Second Republic, Louis Napoleon Bonaparte — Napoleon's nephew — won the first presidential election at the age of 40. He then staged a coup and ruled as emperor under the name Napoleon III. Macron has enjoyed a meteoric rise to the top of French politics. The former banker served as the country's economy minister under outgoing President Francois Hollande, but has never held elected office. He launched an independent political movement, called En Marche, only a year ago. However, Macron would not beat all records for precociousness, if he succeeds Hollande as president. France's King Louis XIV was just 4 years old when he started his rule back in 1643. The courtyard outside the Louvre museum in Paris has reopened after a brief security scare prompted an evacuation of the site where French presidential candidate Emmanuel Macron plans to celebrate election night. Explosives experts have left the site after a suspicious bag prompted the evacuation on Sunday of a few hundred people, primarily journalists preparing for Macron event. The museum itself was not evacuated or closed, and visitors continued entering and leaving. The Louvre already was being heavily guarded after an extremist attacker targeted soldiers near the museum during the presidential campaign. Paris police said the evacuation was a "precautionary measure." Some 50,000 security forces are guarding voting stations and other sites around France for Sunday's runoff between Macron and far-right leader Marine Le Pen. Emmanuel Macron's campaign press office says it was a suspicious bag that prompted the evacuation of the courtyard outside the Louvre museum where the centrist French presidential candidate has planned to celebrate election night. Macron's team said a press room had been set up at the downtown Paris location and 300 journalists who were on site have been evacuated as a precaution. The Louvre already was being heavily guarded after an extremist attacker targeted soldiers near the museum during the presidential campaign. The Paris police prefecture Tweeted a reassuring message: "#Louvre These are simple verification measures carried out as precautionary measure." The runoff election in which Macron is competing against far-right candidate Marine Le Pen is being conducted under the watch of 50,000 security forces guarding against extremist attacks. Emmanuel Macron's campaign press office says the courtyard outside the Louvre museum where the centrist French presidential candidate has planned to celebrate election night has been evacuated because of a security alert. Campaign spokeswoman Pauline Calmes told The Associated Press that the Esplanade du Louvre, in downtown Paris, was evacuated on Sunday as a precaution. She did not specify the nature of the threat, but says police ordered the evacuation. Macron picked the dignified internal courtyard of the renowned palace-turned-museum as the location for his celebration party. The Louvre already was being heavily guarded after an extremist attacker targeted soldiers near the museum during the presidential campaign. Lines of French citizens stretched down the block at a school in central London as dozens cast their ballots in the final round of the country's presidential election. Thousands of French citizens who live and work in the United Kingdom are voting in 11 cities in Britain, making their choice between centrist Emmanuel Macron and far-right populist Marine Le Pen. London has been described as France's "sixth-biggest city," and French voters in the British capital had two polling stations to choose from. One was the private Lycee Francais Charles de Gaulle school. Sylvie Bermann, the French ambassador to the U.K., was among the voters casting their ballots on Sunday morning. France's Interior Ministry says the voter turnout in the country's presidential runoff election so far is running slightly lower than it was in 2012. The ministry said as of midday Sunday that 28.23 percent of eligible voters had cast ballots, compared with the 30.66 percent half-day tally during the last presidential runoff five years ago. Centrist candidate Emmanuel Macron was considered the front-runner going into the runoff. But commentators think a low voter turnout would benefit far-right candidate Marine Le Pen, whose supporters are seen as more committed and therefore more likely to show up to vote. The last polling stations close at 8 p.m. (1800GMT.) Far-right French presidential candidate Marine Le Pen has cast her ballot in Henin-Beaumont, a small northern town controlled by her National Front party. Le Pen arrived at the polling station with Henin-Beaumont Mayor Steeve Briois, who took over as the National Front's leader during the presidential election campaign. She was able to vote without any incident after feminist activists were briefly detained a couple of hours earlier Sunday for hanging a big anti-Le Pen banner from a church. Polls suggest centrist candidate Emmanuel Macron is favored to beat Le Pen in Sunday's runoff election. While Le Pen has worked hard to rid her nationalistic party of its xenophobic image, she has campaigned on an anti-immigration, anti-EU platform. The election is being watched as a bellwether for populism's global appeal. Centrist candidate Emmanuel Macron, the front-runner in France's presidential election, has voted in the coastal town of Le Tourquet in northern France alongside his wife, Brigitte Macron. The former Socialist economy minister and one-time banker was all smiles and petted a black dog as he stepped out of his vacation home in the seaside resort. For security reasons, Macron was driven to his nearby polling station at Le Touquet City Hall and shook hands with a large crowd of supporters before he and his wife entered the building. Macron had a large polling lead over far-right leader Marine Le Pen going into Sunday's presidential runoff election. Outgoing French president Francois Hollande has cast his vote in the runoff election to replace him. Hollande voted Sunday morning in his political fiefdom of Tulle in southwestern France. Hollande, the most unpopular French leader in the country's modern history, decided not to stand for re-election last year. The Socialist president has called on voters to reject far-right candidate Marine Le Pen and to back centrist Emmanuel Macron, his former protégé. The Socialist candidate, Benoit Hamon, was eliminated in the election's first round after receiving some 6 percent of the vote. Police and soldiers are working to secure symbolic Paris venues where France's next president will celebrate victory after Sunday's runoff election between centrist Emmanuel Macron and far-right candidate Marine Le Pen. Macron has opted for the dignified Esplanade du Louvre, the courtyard of the renowned museum in central Paris. The Louvre is already heavily guarded after an extremist attacker targeted soldiers near the museum during the presidential campaign. If Le Pen wins, she plans to celebrate at the Chalet du Lac (sha-LAY doo lahk) in the Bois de Vincennes (bu-AH de vin-SEN) , a vast park on Paris' eastern edge. She is notably staying away from the area around the Paris Opera, associated with her father's past xenophobic reign over her National Front party. Celebration sites have a huge symbolic power, and both candidates are trying to break with the past and the traditional left-right divide. It's no wonder Macron didn't choose the Bastille or Republique squares, two highly popular places for the left, or the Place de la Concorde, where former right-wing President Nicolas Sarkozy celebrated his victory. Feminist activists have hung a big banner from a church to protest French presidential candidate Marine Le Pen in the depressed northern town where she is casting her ballot. The activists were quickly detained after the protest Sunday in Henin-Beaumont, the latest among many actions in recent days against Le Pen or against both candidates. Polls suggest centrist Emmanuel Macron is favored to beat Le Pen in Sunday's runoff election. Parisian voter Yves Robert staged his own kind of protest, casting a blank ballot. Many voters like him are both worried about the racist past of Le Pen's National Front party and worried about the 39-year-old Macron's inexperience or his pro-business policies. Retiree Gabrielle Lebbe says she voted because she's "worried for my grandchildren, I'm worried for the world." Voters across France are casting ballots in a presidential election runoff that could decide Europe's future, choosing between independent Emmanuel Macron and far-right populist Marine Le Pen. With Macron the pollsters' favorite, voting stations opened across mainland France at 8 a.m. (0600 GMT) under the watch of 50,000 security forces guarding against extremist attacks. Polling agency projections and initial official results will be available when the final stations close at 8 p.m. (1800 GMT). The unusually tense and unpredictable French presidential campaign ended with a hacking attack and document leak targeting Macron on Friday night. France's government cybersecurity agency is investigating the hack. Either candidate would lead France into uncharted territory, since neither comes from the mainstream parties that dominate parliament and have run the country for decades.
News Article | May 18, 2017
The Conservatives have taken great pleasure in depicting Labour’s manifesto as a throwback to the 1970s. Their own document also has echoes of the decade of oil shocks and rampant inflation. Theresa May plans to be the most interventionist Tory prime minister since Ted Heath, all the way down to the proposal to modernise the shipbuilding industry. Two sentences in the Conservative manifesto sum up the rejection of the pure laissez-faire doctrine Margaret Thatcher held so dear. “We do not believe in untrammelled free markets,” and “we reject the cult of selfish individualism”. May’s twofold message to the electorate is clear: the Tories are no longer the nasty party and she has something to offer wavering Labour voters. This, put simply, is third way Conservatism. For some rightwing Tories, the attack on free markets and the belief in the power of the state will be heresy. In political terms, it is May’s equivalent of Blair dropping the commitment to nationalisation soon after he took over as Labour leader. It is her Clause IV moment. In other ways, too, the manifesto has echoes of New Labour. Gordon Brown used to talk about “prudence for a purpose”; May adopts a similar approach. Sound public finances are not an end in themselves but are the foundation of a successful economy. Even so, the manifesto demonstrates some chutzpah when it says a government that cannot manage its money properly will be incapable of commanding confidence at home or abroad. When they came to power in 2010, the Conservatives said they would put the public finances straight in a single parliament. The underperformance of the economy meant a 2015 deadline became a 2020 deadline and is now a 2025 deadline. The glacial pace of deficit reduction means that the 2017 manifesto is far more cautious in its tax pledges than the one produced by David Cameron two years ago. Back then, when the opinion polls were suggesting a hung parliament, Cameron pledged no increase in income tax rates, national insurance contributions or VAT. Of those, the only one to make the cut this time is the promise not to raise VAT. Similarly, the triple lock on pensions has become a double lock and there will be means testing – another hallmark of Brown’s approach – of the winter fuel allowance for pensioners. Expect Philip Hammond (assuming he is still chancellor) to take advantage of the extra leeway in the autumn. Taxes tend to go up in the first budget after an election. From the moment she arrived in Downing Street last summer, May signalled that she favoured a more hands-on industrial strategy, and the manifesto fleshes out some of the new thinking: a commitment to raise research and development spending to the 2.4% of GDP average of developed countries within 10 years, and a longer term aim of reaching 3% of GDP. Growth industries of the future will be identified and supported through trade, tax, infrastructure, skills, training and R&D measures. Some of the manifesto commitments lack substance. The pledge to cut net migration to the tens of thousands has been retained but without any notion of how the target will be achieved. It would be missed even if, in the aftermath of Brexit, there was a complete ban on workers arriving from the EU. Similarly, the manifesto says the Conservatives would protect people working in the “gig” economy, without fleshing out how they intend to do so. The sections on executive pay and corporate governance are strong on rhetoric but weak on specifics. May’s manifesto differs from Jeremy Corbyn’s in two distinct ways. Firstly, it contains far fewer numbers. Labour feels the need to show that its sums add up: the Conservatives believe that voters will take what they say on trust. Secondly, the decision to drop the triple tax pledge, ditch the triple lock on pensions and to make the elderly pay more towards social care speaks volumes. Labour’s manifesto was about shoring up its core vote ahead of an election it expects to lose. The Conservatives are focusing on issues such as social care and intergenerational fairness because they expect to be in power for a long time.
News Article | May 21, 2017
On 24 June last year, the few hundred residents of a temporary village, hidden from view in the middle of a West Sussex soft fruit farm, received letters. They were signed by David Kay, the managing director of the Hall Hunter Partnership, a business that grows 10% of the UK’s strawberries, 19% of its raspberries and a whacking 42% of its blueberries across thousands of acres, of both glasshouses and polytunnels. The recipients were his seasonal workforce, some of the 3,000 pickers from Bulgaria, Romania and elsewhere who come here each year to get the harvest in, and without whom the business would simply not exist. “I wanted them to know that in the face of the vote for Brexit we would hang together as a family,” he says now, standing amid the mobile homes his workers live in during the summer months. The dwellings come dressed with satellite dishes pointed at news channels in Bulgaria, and pylons delivering high-speed wifi. Some have planted gardens. Tesco Direct delivers their groceries; coaches take them out on excursions.“I’m responsible for both a fruit farm and 2,100 beds,” Kay says. “That morning I met a lot of very sad and confused workers. For me, personally, it was a shock.” Kay may have wanted to reassure his employees in the immediate aftermath of the vote, but 11 months on their status is no clearer. Indeed, this tidy little village could now stand as a blunt symbol for one of the most serious but little talked about issues arising from the Brexit negotiations: the continued ability of this country to feed itself, if the deal goes wrong. Opponents of EU membership talked during the referendum campaign about sovereignty and control. They railed against the free movement of labour. What they didn’t mention is the way the British food supply chain has, over the past 30 years, become increasingly reliant on workers from elsewhere, both permanent residents and seasonal labour. Last month, as parliament wrapped up for the general election, the Environment, Food and Rural Affairs Select Committee quietly published a short paper called Feeding the Nation: Labour Constraints. As it reported, around 20% of all employees in British agriculture come from abroad, these days mostly Romania and Bulgaria, while 63% of all staff employed by members of the British Meat Processors Association are not from the UK. Around 400,000 people work in food manufacturing here, and more than 30% of those are also from somewhere else. If free movement of labour stops, the British food industry won’t just face difficulties. Some parts will shudder to a halt. Shelves will be emptied. Prices will shoot up. And right now, none of those charged with negotiating Britain’s exit from the EU are making promises that this scenario will be averted. Many of them aren’t even engaging with the issue. The soft-fruit business of which Hall Hunter is a part is right at the sharp end of that. “From February to November we need 29,000 seasonal workers across the sector,” says Laurence Olins, chair of British Summer Fruits, the crop association for berries, which account for one in every £5 spent on fruit in the UK. “And 95% of those are non-UK EU citizens.” The industry has tried to get UK nationals to do the work but they’re simply not interested. “Our hope is for some sort of permit scheme,” Olins says. “But if, say, we get only half the permits we need, we will simply have only half the size of the industry.” The 29,000 non-UK workers they have are therefore vital. And, what’s more, the number required is growing. Kay agrees. “We’ve worked with job centres and with ex-prisoners, but British people don’t want to do these jobs.” Instead, he says, he gets a steady supply of highly educated and motivated eastern Europeans, most of whom have some connection to farming because their families still have smallholdings. “We have a return rate of 76% each year,” he says, “which means we retain a skills base – 70% of our management arrived here as pickers and worked their way up the ranks.” He shows me a list of the 20 most important people in the company and it’s littered with Slavic surnames – 20 nationalities are represented on site. Some have settled here, put their kids into schools and taken UK citizenship. But many more are just seasonal, coming and going at short notice. Every single one is interviewed for a job by a member of Kay’s team; they run temporary recruitment centres in town halls and civic libraries across eastern Europe. At the farm, amid glasshouses of glossy strawberries planted at shoulder height for easy picking, I meet Zyulfie Yusein, 29, and Nikoloy Kolev, 34. Both are from Bulgaria. Both are graduates. Both first came here to earn a little money as students, returning home with their earnings. Over the years, they’ve stayed longer and longer. “It’s a great job,” says Yusein. Kolev agrees. “We work as a team and the team is like family.” But both say the Brexit vote has changed everything. “I worry about the future,” Yusein says. “My friends worry too. The vote made me feel unsafe.” Kolev says, “Going back is not an option but what am I going to do?” They are warm, bright, friendly people, but the tension just beneath the surface is palpable. They are already experiencing the downside. The Brexit vote has weakened the pound by up to 20%. Their salaries are worth far less at home than once they were. And the message is getting back to their friends. “Some of the seasonal labour is choosing not to come to the UK because of the value of sterling,” Olins says. “If you can go to work in a Euro country like Spain, rather than Britain, it’s worth doing so.”There used to be 10 applicants for every picking job in the UK. Now there are three. “The candidates we’re getting are older, they have fewer skills, their English is worse.” Is that just down to Brexit? “The media in the home countries has been reporting attacks on immigrants to the UK,” he says. The mood here has changed. And it risks imperilling the harvest British citizens don’t want to help bring in. On 26 July, 2016, a little over a month after the referendum vote, representatives of more than 40 food and drink associations gathered in the meeting room on the sixth floor of the Food and Drink Federation’s HQ on London’s Bloomsbury Way. Here were representatives of the British Poultry Council and the Federation of Bakers, the British Growers Association, the National Association of Cider Makers and many more besides. They were joined by civil servants from Defra, the Food Standards Agency, the Department for Business, David Davis’s Brexit department and HMRC. The meeting had been called by Ian Wright, a former executive at drinks company Diageo who now heads the Food and Drink Federation. The meeting was to coordinate a response to Brexit. And top of the agenda was the issue of labour. The same group has met every month since. “It’s fair to say that we started out with a degree of surprise at all levels,” Wright says. “Very few ministers or civil servants understood the nature of the food-chain workforce.” He believes they have managed to get the message across, but that’s a very different thing to dealing with the issue, given the refusal by Downing Street to be drawn on their negotiating positions. “Right now, there’s a great deal of work going on to define the choices the prime minister will have to take to sustain the variety and complexity of the food supply chain.” The alternative, he says, is fewer choices for consumers or sources of labour from outside the EU. Early in this election campaign Labour’s Brexit spokesman, Keir Starmer, made a commitment to guarantee the rights of the estimated 3.9 million EU citizens living in the UK on day one of a Labour government. David Davis met this with a soothing assertion of a swift deal to secure those rights. That’s not surprising. The non-UK citizens here are mostly of working age and economically active. The 900,000 UK citizens in Europe are mostly pensioners living out their retirement on the sun belt in increasingly poor health. Theresa May’s government is desperate not to have them sent back for fear of the pressure they will place on the NHS. But what matters is not those living here full-time but the seasonal workforce that comes and goes. Until 2013, there was a seasonal-labour permit scheme which, ironically, was abolished, because the EU free movement system was deemed to be working so well. A replacement would be needed. Pushed for a number of permits required, Wright suggests “around half a million”. Hard-line Brexiters, committed to an end to the free movement of labour, might well find this unpalatable. Indeed, one of the big food-sector bodies told me they received off-the-record calls from civil servants warning them to shut up, because they had been quoted in newspapers talking about the seriousness of the labour supply to the food chain. “We were told we would just enrage the hard-line Brexiteers,” a member of the body told me. The problem is compounded because some sectors need a huge mass of workers. Others need very few. In some areas of the food chain, it can be down to just a few dozen people who keep the whole thing running. For example, under Food Standards Agency rules, an abattoir in England, Wales or Northern Ireland cannot operate unless the animals on the way to slaughter are overseen by one of their vets. This is work British vets don’t want to do. They would rather be out on the farm with livestock in the prime of their lives, or dealing with domestic pets. As a result, at least 85% of vets in British abattoirs are not from the UK. Apparently, the majority are Spanish. And if they couldn’t get into the country to do the job, the meat supply chain would collapse. While Ian Wright is good at the diplomatic phrase, others feel less constrained. In the months running up to the Brexit referendum, Tim Lang, professor of food policy at London’s City University, co-authored a briefing paper on Britain’s dependency on EU member states for its food. It dealt in detail with seasonal labour from the EU. He can be forgiven for wondering why he bothered. “The civil service is dispirited and uncertain of what they’re doing because they haven’t been given any signals,” Lang says now. “There’s not a bleep about food policy coming from ministers. There has been a stunning silence from Andrea Leadsom, the Defra minister, on this matter of national importance. Basically, if on March 31, 2019, migrant labour is not sorted the food system is fucked.” And then he says, “I hope those who voted Brexit and who still want to eat British are prepared to go to Lincolnshire in winter to pick vegetables.” Or as Wright puts it, “Food is at the heart of national security. If you can’t feed a country you haven’t got a country.” For five years as a food reporter for the BBC’s One Show, I used to travel the country from one strip-lit food production unit to another, looking at exactly where our food came from. The ethnic mix was always striking. The media were forever talking about a British food revolution; of a homegrown improvement in quality at both small and large scale. And the companies were indeed British, but so many of the people doing the actual producing were not. I visited cake factories where the health and safety notices were in both English and Polish; was given tours of vegetable processing plants where the floor managers needed a smattering of four eastern European languages to get by. I take a train north from Hall Hunter’s fruit farm, to the North Yorkshire home of Heck Sausages, run by Debbie and Andrew Keeble. In just four years their innovative range of gluten-free sausages – from pork and apple, through square to non-meat alternatives – has been stocked by all the major supermarkets. Their turnover is projected to reach £18m this year and they are about to move into a new plant which will enable them to run multiple production lines. The only issue is workforce, which will have to double. Of the 60 people currently working in production, 85% are from eastern Europe; like Hall Hunter, Heck can’t get British people to do the work. I ask Debbie Keeble what an end to free movement of labour would mean to her business. “It would be cataclysmic,” she says. “No one here will take these jobs.” The Heck factory is in an area that voted strongly for Brexit. “During the referendum, campaigners were going on about people coming over here taking our jobs. Well, they’re not, because nobody here applies for them.” Mostly she says it’s word of mouth, with new employees coming either directly from Latvia or Romania or from within the communities in the UK. I talk to one young Romanian woman, Georgeta Iclodean, who talks about getting increasing amounts of hassle from Border Agency officials when she re-enters Britain. “I make sure to have all my papers with me now,” she says. I meet 34-year-old Vladim Protasovs from Latvia who came to Heck in 2014 and has risen to be one of the line managers. “I like working in the UK,” he says. “It’s a very big difference from Latvia.” But Brexit has changed everything. “My children are settled in school here,” he says. “If we had to go back it would be so hard, not just for me but for them. There’s lot of people who want to come from Latvia to work in the UK, but they are worried. I call my friends to say there are jobs but they don’t want to come.” Then he says: “What happens next?” It’s a good question. The truth is nobody knows, not the business leaders, not the diplomats and certainly not the politicians. The prime minister and her team have portrayed negotiations as a game of poker, used the language of hands unrevealed and bluffs, while failing to recognise that the analogy doesn’t work; poker is a winner-takes-all game and Britain cannot afford to lose everything. The Brexit deal isn’t just about vague concepts of nationhood. It isn’t simply about international standing or the ebb and flow of trade.It’s about the lives of individual people like Protasovs and Iclodean, Yusein and Kolev; the ones prepared to do the back-breaking jobs British people are not. What’s more, this is not just their crisis, to be worked out in anguished letters home. It’s ours too. Because without them and the half a million seasonal workers like them, our very ability to feed ourselves, at a price we can all afford, is in peril. In the forthcoming Brexit negotiations that is what’s really at stake.
News Article | May 19, 2017
German industrialists have warned that British hopes of their support in Brexit negotiations are misplaced and could backfire with dangerous consequences for international trade. Business leaders in Europe’s biggest economy are instead calling on Conservatives to rethink their commitment to leaving the single market, even though the party has doubled down on this promise in its election manifesto. David Davis and Boris Johnson have repeatedly cited likely pressure from German exporters, such as carmakers, as a reason for thinking they can persuade European negotiators to maintain free trade access after Britain leaves. But the theory is increasingly rejected by those whose support they need most – scepticism relayed most forcefully by Steffen Kampeter, the chief executive of the German employers’ federation, on a trip to the UK this week. “The top priority of European business is the integrity of the single market; the second priority is making good business with the UK. We will see if there is a conflict, but the message is: do not harm the single market by cherry-picking deals,” he told a conference of British business leaders in London this week. “It’s not the German carmakers that are directing the negotiations,” added Kampeter, who said he knew of no one who thought a trade deal within 18 months was possible and called for “rhetorical disarmament on all sides”. An independent panel of economists that advises the German government has also intervened by proposing a plan that would avert such a cliff-edge scenario, whereby Britain would temporarily rejoin Efta – the trading block that consists of Switzerland, Norway, Iceland and Liechtenstein – at the point when its EU membership runs out and therefore preserve its membership of the single market. Making such a “reverse Efta” a temporary stepping stone would avert irreparable damage to the British and German economy and allow Theresa May to satisfy the tabloid press’s demand for a swift exit, argued Albrecht Ritschl, one of the four authors of the letter. May appeared to rule out this option in the manifesto by insisting Britain would leave the single market, but it is possible this could serve as the basis for a transitional deal that some Tories still support. Ritschl said some leading Brexit advocates’ hopes of Angela Merkel forcing the EU to agree a free-trade deal before Britain officially dropped out of the EU in 2019 was based on a misunderstanding of the relationship between German politics and industry. “Of course Germany has a strong export industry, but even in Berlin people have over the last two years come to realise that an enormous export surplus can be a weakness as well as a strength”, he told the Guardian. “Above all, German industry knows that when it comes to dealing with international politics, you sometimes have to go with what the government decides. In any case, if businesses had to choose between maintaining exports to the UK and keeping the European Union together, it’s obvious they would go with the latter.” Andreas Meyer-Schwickerath, director of the British Chamber of Commerce in Germany, said: “My impression is that German companies are getting very concerned about the tone that has been whipped up by the election campaign in the UK. If we don’t start tackling problems swiftly and pragmatically, then the whole debate could escalate beyond repair.” Some Whitehall veterans fear a lack of understanding of European commercial thinking is a major handicap for British negotiators. “I worry about the lack of European experience in our team,” said Jonathan Powell, a former Downing Street chief of staff. “They do not have that granular experience of difficult negotiations and we will be really struggling to catch up with them.” At a speech on Wednesday, Merkel, the German chancellor, repeated her warnings about the economic cost of leaving the trade bloc. “This is not meant maliciously, but you cannot have all of the good things and then say there’s a limit of 100,000 or 200,000 EU citizens allowed to enter the UK,” she said. “That won’t work. At that point, we’ll have to think about which restrictions we make on the European side to compensate for that.” A recent poll in Germany and other EU countries showed that eight in 10 people thought that the interests of the EU should be more important during negotiations than keeping intact economic ties to the UK. The German economists’ letter, whose receipt was acknowledged by the economic ministry in Berlin on Thursday, warns that without a transitional solution such as the one offered by Efta, Germany would “risk causing unnecessary damage to economic ties”. The Efta proposal comes at a time at which it is increasingly clear that concerns of German industry are not cutting through to German politics in ways in which British advocates of a hard Brexit have predicted. “A phased Brexit using Efta as a stepladder to put integration with the EU into reverse would give Theresa May a symbolic clear break with the EU at an early stage of the exit process, since Britain would no longer be subject to the rulings of the European court of justice”, said Ritschl, who is also an economist at the London School of Economics. “At the same time it would protect a legal framework for the further negotiating of a free trade deal, since Efta has its own court of arbitration in Berne.” The entry of the the UK and its 65 million people would be a radical change for Efta, a 13.5 million trading bloc of which the UK was a co-founder in 1960 until it joined the European Economic Community in 1973. Frank Bakke-Jensen, Norway’s minister of EU and European Economic Area affairs, said on Tuesday Efta took an open approach to the question of UK membership, in contrast to doubts voiced by Norwegian ministers last year. “We would like to be open-minded and find the best solution,” he told journalists in Brussels. Questioned about how long it could take Britain to join Efta, he said: “International cooperation is not a button you can turn on and off. It is complicated, so we will have to see. For the time being the question is not on the table, the UK has said ‘no thank you’.”
News Article | February 19, 2017
The proposed £115bn takeover of Unilever by Kraft Heinz has been called off, just two days after the offer was announced. The takeover of the Anglo-Dutch consumer goods giant would have been one of the largest deals in corporate history but was resisted at Unilever and had provoked political unease over British jobs. Unilever rejected the offer by the American firm on Friday, describing the approach as having “no merit, strategic or financial”. Kraft Heinz was expected to return with a higher offer, but late on Sunday the two firms issued a surprise joint statement announcing no deal would go ahead. It said: “Unilever and Kraft Heinz hereby announce that Kraft Heinz has amicably agreed to withdraw its proposal for a combination of the two companies. “Unilever and Kraft Heinz hold each other in high regard. Kraft Heinz has the utmost respect for the culture, strategy and leadership of Unilever.” The US food giant had been preparing to meet top tier shareholders, which include BlackRock, Leverhulme Trust and Legal & General, to convince them to accept the deal. But the strength of resistance to the proposal saw Kraft decide over the weekend to back away. As well as Unilever’s clear reluctance, unions had raised fears over jobs, and discussions had started with the business secretary, Greg Clark, over a move that appeared to have strong echoes of the takeover of Cadbury’s by Kraft in 2010, a deal singled out for criticism by Theresa May last year. A spokesperson for Kraft Heinz said: “[Our] interest was made public at an extremely early stage. Our intention was to proceed on a friendly basis, but it was made clear Unilever did not wish to pursue a transaction. “It is best to step away early so both companies can focus on their own independent plans to generate value. We remain focused on driving long-term value while always putting our consumers first.” Unions had voiced fears over the 9,000 jobs in Britain that could be affected under a takeover of Unilever by Kraft Heinz, where billionaire investor Warren Buffet owns more than a quarter of the shares and which is also backed by 3G, a Brazilian private equity firm. Unite, Britain’s biggest union which directly represents about 2,000 of the 7,500 Unilever staff in the UK, welcomed the news. A Unite spokesman said that while the union was pleased that Kraft Heinz had signalled their withdrawal, the bid illustrated a need to reform takeover rules: “It shows the need for a ‘Cadbury rule’ which takes into account the issues like jobs and consumers in these circumstances, so it’s not just down to how deep someone’s pockets are, to throw money at shareholders.” The Cadbury rule is a reference to the controversial £11.5bn takeover of chocolate maker Cadbury by Kraft in 2010. Pledges to save factories were reneged on almost immediately, before the firm was spun off to form a separate firm, Mondelez, while customers believed the quality of products such as its Creme Egg were downgraded. A source close to the bid earlier insisted there was “no comparison” between the Kraft Heinz company and its management team and the Kraft that took over Cadbury – but admitted that there would be stringent cost-cutting and “synergies” including job losses should Unilever be taken over. Downing Street did not confirm reports that the prime minister had ordered top officials to examine the planned takeover of Unilever to see if it could merit government intervention. A spokesperson for the Department of Business, Energy and Industrial Strategy (BEIS), had said it was continuing to monitor the situation closely. The bid of £115bn would have made it the second largest takeover in corporate history, beaten only by Vodafone’s $203bn (£163bn) takeover of Mannesmann in 2000. A combined Kraft-Unilever would have been valued at more than £200bn and control 3% of the global packaged food market, according to Euromonitor. The share price in both firms may be expected to slide back on Monday, after surging on news of the offer on Friday. Buffett’s fortune was briefly boosted by another $5.7bn purely on his personal stake in Kraft Heinz, whose shares rose 10%, while Unilever shares rose 13.4% to a record high. The takeover bid was fiercely resisted by the board, led by Paul Polman, the chief executive of Unilever, although he would have stood to earn almost £12m in shares under a sale. The Dutch CEO has made a name as an unusual advocate for sustainable business and global concerns such as poverty and climate change.