Author Archives: markdowe1

Britain, Economic, Europe, European Union, Financial Markets, Government, Politics, Society

The sanctions on Russia should not be borne solely by London…

EUROPE

Germany and the rest of the Eurozone trade far more with Russia than Britain does. Our European partners buy billions of pounds worth of oil and gas, hugely profitable cash-flows which props up the regime of Vladimir Putin.

Yet, Europe’s proposed sanctions on Russia have been carefully designed to inflict as much damage as possible on the City of London, while shielding other economies from collateral damage. The stench of hypocrisy fulminates through the corridors of power.

The aim of the European establishment is to punish Mr Putin, whose behaviour has been appalling. But the cost should not be borne solely by London. According to Europe’s plans, German companies will still be able to sell their wares with relative impunity; Italy will continue to receive their energy supplies courtesy of Moscow; and, France will deliver its warships to Russia as promised. The bulk of the cost will be paid for by British workers who will lose their jobs to satisfy Europe’s desire to be seen to be acting and doing the right thing.

This is the latest example of the European elites showing their expertise in turning every crisis to their advantage. The higher echelons of the European establishment are clearly seeking to use the need to punish Russia as an excuse to intensify their long-standing campaign against the City.

The EU often makes grandiose claims about being a global force for democracy and human rights. Splendid as those values are, time and time again the EU reveals itself as merely an alliance of competing national interests. On matters of global conflict, Brussels not only struggles to produce a united front, but also often ends up pursuing its own internal vendettas instead. This prejudice is seen within the corporatist view of the Eurozone elites when, for example, they are happy enough to sign massive energy deals with corrupt and authoritarian regimes, but don’t either like or understand the workings and mechanisations of genuine free markets. The creation of the single currency too saw much of the financial activity previously conducted in Frankfurt and Paris shift to London.

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Effective sanctions should mean moving beyond the freezing of Russian assets in EU capitals and foreign travel bans on Mr Putin’s inner circle. Financial services, defence, and energy are some of the areas that should come under tighter sanction.

Financial sanctions operate in two ways. They restrict the access of Russian companies to working and investment capital, impeding not just their growth but their continuing activity, so hurting the Russian economy. They also make overseas investors much less likely to continue investing in Russia, with a similar effect. Defence sanctions, essentially the sale of Russian military equipment to other EU members, has the same consequence with the additional value of Russia becoming increasingly isolated. Sanctions on energy can range from tougher regulatory action to an effective blockade on the sales of oil and gas to the EU. Germany’s recent withholding from Gazprom of permission to use a pipeline is illustrative of the effectiveness of such action.

Further sanctions like these would, however, act like a two-edged sword. Certainly, they will injure Russia’s economy, but they will also wound Europe. Some parts of Europe could not get through a winter without severe difficulties if homes and offices were not heated by Russian gas. Some economies remain distinctly shaky and probably wouldn’t want to commit to a sanctioning agenda that would likely rebound on their own trading position.

Of course, it is only right that where Mr Putin’s regime can be targeted, given his ongoing refusal to face up to the consequences of his support for Ukraine’s separatists, such action be taken. Weaning Europe from its addiction to Russian gas is one real way to punish the Russian president and his cronies. Germany gets around a third of its gas and oil from Russia. Given that energy accounts for around 68 per cent of Russia’s exports, an opportunity to hit the regime hard should have been taken by now.

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Britain, Defence, Government, Military, United States

A replacement for the Nimrod. The search is on…

DEFENCE

Four years ago, Britain scrapped its Nimrod maritime surveillance aircraft. But the issue of whether an island nation needs a plane to patrol its waters remains.

The Ministry of Defence cancelled the Nimrod’s replacement as part of the 2010 Strategic Defence and Security Review (SDSR), citing the need to cut costs. The decision, however, meant Britain lost a crucial ability to monitor the threat from foreign submarines in its territory.

There have been reports of Russian vessels mooring and sending sailors ashore to enjoy local hospitality – all without being tracked by the UK military, the security implications of which should be clear.

Some aspects of the Nimrod’s function have continued, using surface ships, the RAF’s E3D Sentry aircraft and helicopters.

But much of what the Nimrod was good at has been lost – particularly the ability to detect small objects on the sea’s surface, such as submarine periscopes.

That Britain has no suitable maritime patrol aircraft capability is viewed by some defence analysts as a ‘national disgrace’. As a minimum, Britain needs to be able to monitor what goes on within the UK search and rescue area – no small task given it covers 2m square miles of sea.

A typical mission for these aircraft lasts eight hours before refuelling is required.

However, if rumblings from within Whitehall and industry are to be believed the gap left by the Nimrod could soon be filled.

Prior to Philip Hammond leaving Defence to become Foreign Secretary in the recent UK Government reshuffle, Mr Hammond is said to have privately given ‘top priority’ to the project, insisting that it be contained within the 2015 SDSR.

Analysts estimate that plugging this gap will cost around £2bn. Once funding is assigned, it could go into the MoD budget cycle for 2016 with an aircraft in service by the end of the decade.

The MoD is keen to emphasise that the first question is just what is required. Only then can the machine and sensors that will provide the surveillance be considered. One idea is some form of multi-mission aircraft that can be used for maritime patrol, intelligence gathering, airborne command and control and even in some transport capacity.

The current favourite appears to be the P8 Poseidon made by US aerospace giant Boeing – effectively a militarised 737 passenger jet. Instead of seats, the P8 would be packed with sensors and equipment used to track submarines or missing surface ships.

British crewmen are already flying on the P8 aircraft to maintain their skills. As defence secretary, Mr Hammond also visited a P8 squadron in America and is said to have been impressed.

Other ideas include packing the fuselage of Lockheed Martin’s rugged C-130 Hercules transport aircraft with high-tech sensors and turning it into a maritime patrol specialist.

Northrup Grumman, another US defence firm, would like to see its drones used to monitor the ocean from high up and then send specialist reconnaissance aircraft in to check on possible discoveries closer to the surface.

Just how many aircraft will eventually be needed is another moot point. Analysts suggest a minimum of 12, given some aircraft will inevitably be in maintenance, some used for training and others deployed overseas at any one time.

But senior industry executives believe the MoD’s decision is also about the continued viability of Britain’s defence industry.

Buying off the shelf might be seen as ‘cheaper’, but if the domestic capability to design and manufacture military equipment is lost it will leave the nation’s security at the mercy of foreign powers.

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Foreign Affairs, Israel, Middle East, Palestine, United Nations, United States

The cynical invasion of Gaza by Israel…

GAZA

Intro: Israel’s ground invasion of Gaza, which began last Thursday, becomes its fourth such war on the Palestinian strip in the past decade

With the Israeli armed forces having kicked off the latest episode in a 66-year-old conflict, the brutality and cynicism of its actions suggests resolution is further away than ever.

Israel’s ground invasion of Gaza, which began last Thursday, becomes its fourth such war on the Palestinian strip in the past decade. Following its withdrawal from the densely populated enclave in 2005, Israel sent its troops back in 2006 and 2008. In 2012, the offensive was confined to surgical air strikes and a campaign of bombing. In each case, the reason for acting was the same: to halt rocket and missile attacks into Israel by Hamas, the militant Palestinian group that largely controls Gaza. Hamas refuses to accept the existence of a Jewish state.

Each time, the sequence of events has become choreographed into one that is utterly and depressingly predictable. Israel responds disproportionately, always inflicting far greater casualties than it suffers. As international accusations and condemnations of Israeli overreaction multiply, a ceasefire eventually happens, either declared unilaterally by the Israeli government or brokered through a third party, most likely Egypt and/or the United States. In the interim, some Hamas leaders will be targeted and killed, and some rocket launch sites and underground tunnels from Gaza into Israel will be destroyed.

In reality, though, nothing is ever likely to change. More arm shipments will flow into Gaza, new Hamas leaders will emerge, and new tunnels will be dug. When equipped and replenished enough the Palestinian militants will once again fire off its rockets, and Israel will ready itself as it will feel compelled to act in light of the provocation and threats it faces. All the while, as the root causes of the conflict remain untackled, the prospects of a final settlement grow ever dimmer.

The new level of fighting may well lead to a new Palestinian intifada. Israel, protected by its barrier wall – declared illegal by the International Criminal Court – from potential terrorist attacks and by its robust Iron Dome anti-missile system from Hamas rockets, seems less interested than ever in a two-state deal. Far from being concerned about the plight of Palestinians and their livelihoods, Israel simply ignores them, pressing ahead with its settlement building programmes on territory that would be part of any future Palestinian state.

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A ground invasion of Gaza, however brief, was always likely to signal an intensification of the Israeli response to the more than 900 rockets which have fallen into Israeli territory over the past 10 days. Fears exist for a much greater troop deployment in the coming days. Some 40,000 Israeli reservists have already been mobilised. But that will only work to fuel Palestinian resistance and intensify retaliatory rocket strikes that now reach much further than within a 25 mile radius of Gaza.

It is these rocket attacks that the Israeli government is determined to stop. For so long as they continue, Israel’s shelling of targets within Gaza will go on. Inevitably, this puts further civilian lives at risk. Without the strongest foreign diplomatic intervention the bloody cycle of tit-for-tat rocket and bombing attacks seems likely to endure. There are no signs of the current hostilities ending any time soon. The latest outbreak in violence is still young by comparison with previous offensives. Exchanges during the outbreak in 2011-12, for instance, lasted 22 days.

The day after Israel launched its current air offensive in Gaza, Prime Minister Benjamin Netanyahu gave a rare press conference in which he was brutally blunt about the danger he believes the state of Israel to be in. He made clear he could never countenance a fully sovereign Palestinian state in the West Bank. Mr Netanyahu’s world-view is that Israel is standing almost alone on the frontline against a rising tide of vicious Islamic radicalism. He insists that the rest of the as-yet free world does its best not to notice the march of extremism. Such indifference says nothing of how western intelligence services are battling against the odds to keep their citizens safe or at the outrage following the recent air disaster over the skies of eastern Ukraine.

Mr Netanyahu has also indicted that he considers the current American diplomatic team led by John Kerry as naïve. Netanyahu made plain that ‘no international pressure will prevent us from acting with all force against a terrorist organisation that seeks to destroy us’.

Operation Protective Edge will thus go on until ‘guaranteed calm’ was restored to Israel. A prerequisite for that, it seems, is a cessation of Palestinian rocket and missile attacks.

Either the Israeli offensive in Gaza will go on until Hamas has exhausted its supplies of air-to-ground missiles (the scale of which, this time around, has been astonishing) or international pressure is brought to bear. Despite Mr Netanyahu’s rhetoric, Israel well knows it only has a narrow window for further military force before international opinion swings heavily against it.

For diplomatic intervention to be effective it needs to come from the top, as well as being co-ordinated with pressure from Western leaders as a matter of urgency. An approach centred on de-escalating the current rocket exchanges should be the priority before any other progress can be made in securing a more lasting truce.

 

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