Britexit3 : What the UK must do BEFORE its referendum to leave the EU

FIRST Build Supranational Counter-Instruments!  (Part three of series)

What would be the nature of the instruments that would be needed for the negotiations? Here are some of the issues needing action BEFORE the UK Government sends its letter of withdrawal. The strategy requires implementation as soon as possible, even before the referendum.

If not the institutions may make implementation more and more difficult for serious negotiations. The eventual goal must be borne in mind.  The negotiation has to provide honest and fair solutions.

A bitter barter deal won’t cut it. It will be subject to endless renegotiations like the British rebate and the common fishing policy. Iceland has always maintained that sustainable fish stocks were the rock of its policy.

Not the EU. Secret political deals in Council ignored scientific assessments. Fish stocks were wiped out. Britain needs sustainability or it could be decimated by secret attacks at the Council of Ministers like the fish stocks. 

How can UK negotiate with Brussels when the institutions are not impartial? Take the Commission as an example. It has to act for 27 Member States plus the UK at the same time. Which side will it Commission favour since one member will leave and 27 will stay? How can it be impartial? Can the UK trust it? 

The Commission should provide an impartial overview of UK’s needs within Europe’s needs and interests. It doesn’t. How then can it be impartial when later it represents interests of States who are trying to displace UK and assert its supremacy?

In a recent outburst against the British Conservative group, President Jose Manuel Barroso said that unless they conformed to his idea of pro-European policy, the UK Independence Party (UKIP) would become the ‘first force’ in British politics for Europe.

Mr Cameron retorted the Commission is not respecting the UK’s government party and lecturing it. The strategy must counter the negative proclivity of the Commission thinking that it alone is right. It must do it before and not try to change the highly political Commission during negotiations.

Then there is the Council.  Britain has Europe’s strongest banking and financial sector – which many would like to see moved to the Continent. How can British multinationals be assured that they have fair and open access to the European Single Market without being coshed again?

The Council takes its instructions from the European Council of heads of governments. So what lessons are to be learned their about impartiality? After the 28 June 2013 summit, P.M. Cameron denounced as ‘unacceptable and ‘frustrating’ the one a.m. ambush on the UK rebate issue, supposedly finalized in February. “I just think this is no way for an organisation to conduct itself.” he added. 

The atmosphere could become far worse. The UK should not forget the de Gaulle’s NON. He refused Britain’s entry. Not once, but twice. He caused havoc to international negotiation. He did not discuss it in the Council of Ministers. Or his own Cabinet! Nor by formal letter or in an international conference but at a press conference! He ran the Community like it was his own backyard to exploit for agriculture and bribing politicians and voters.

Then there is the European Parliament. De Gaulle considered it a cipher. Today has gained powers with major financial powers of codecision from the Lisbon Treaty. This could wreck a carefully sculpted negotiation made with the Council. Anyone watching the debates in the EP can scarcely believe that it will take the negotiation lying down and with a benign smile. The Council’s Legal Service concluded that the Financial Transfer Tax was not legal. This did not seem to deter MEPs.

One political group declared in a press release:

Appealing to governments to stick to proposals for the introduction of a financial transaction tax (FTT), despite 'cynical' legal manoeuvring, Portuguese MEP Marisa Matias said the EU has a clear choice:
"Either we rescue politics and our society from financial markets or we can start to say goodbye to a common European project." 

The Court is another hidden danger. An appeal to a Court that favoured integrationist and ratchet federalism could years later strip off key decisions of the negotiation result. All hard, detailed work would be in vain if, years later, the Court reversed key aspects.

The EU has hardly improved democratically since de Gaulle’s day. The fruit of de Gaulle’s corrupt anti-democracy was the misdirection of Community funds into Wine Lakes, Meat Mountains, and Cheese Bergs. Millions of Europeans’ money were wasted on local politicians’ pet infrastructure projects of bridges and autoroutes that went nowhere. 

The entire budget system which takes taxpayers’ money and spends it as the political Politburo decides lacks transparency and control by taxpayers. Today we have airports that have no passengers and other much more expensive wastes of taxpayers’ money.

Even worse the politicians’ ill-founded Euro project (intended by many southern States to get Community funding for governmental mismanagement) costs around seven times the entire EU budget by its European Stability Mechanism ESM, European Finance and Stability Facility, EFSF and other dubious operations of the Fiscal Compact. It is often said that ‘EU is not prepared to make changes.’

It has continuously lost public trust as it has changed from the original idea of a democratic Community of equal partners, equal governments, equal enterprises, unions, consumers and equal individuals. Today it run by party political machines, who are lobbyists for who knows whom. It is a political club run in secret by a politburo in the closed-door European Council and the EuroGroup.
It chooses the Parliament president in secret.
It makes Foreign Policy in secret.
It names the European Central Bank president in secret.
It appoints the Commission president in secret from among its own, ignoring 98 percent of the European population.

But the UK has real Membership leverage to bring reform BEFORE the Exit Letter. How?  The second key aspect of the negotiation is the pre-reform of institutions to make them really democratic.  Only when the basic conditions are settled for a democratic discussion, should the UK government think about sending its official letter about leaving the EU.

Ukraine2: Stupid Europeans! Ukraine and Syria are part of Global Blackmail against you!

Ukraine and Syria are part of the global battle in which Europe is the target, victim and the source of blackmail revenue. Europeans have been behaving stupidly since the 1950s, when the Founding Fathers of the European Communities warned them of the dangers. They ignored the warnings.

What would you call it if you were getting oil at a dollar-and-a-half a barrel and the supplier was making such a profit from it they were living the life of Reilly? You might call it free trade. Both parties are happy.

What do you call it when the supplier raises the price FOUR times and also says that you have to change your foreign policy if you are to get anything at all?

That is blackmail. Stupid Europeans have been grinding their teeth and paying through the nose ever since the 1973 Oil Weapon was deployed.

It only works if the buyer --the Europeans -- think that they are incapable of producing energy themselves and must rely on suppliers who turn out to be a cartel or multiple cartels. With all their science and technology can't Europeans produce energy and electricity and maintain their independence from financial and political exploitation? Who is persuading them to stay on the oil drug? Maybe we should look where oil drug profits are going.

Yesterday it was the Middle East -- where Europe got entangled in Arab wars and hatreds. Today Europe is not free from that bowl of spiders. It has also got involved with the Russian energy cartel which works on the same principles of extortion. Now they are competing with each other. The Joker in the power game is shi'ite Iran which could try to block the Mid-East transport routes for oil and gas out of the Gulf. It can also play nuclear blackmail among the neighbouring States. Iran has been fighting in Syria. Qatar, a mere pimple on the east of Saudi Arabia, has the largest Liquid Natural Gas (LNG) operation and one of the biggest gas fields in the world. How will it get its gas delivered if the Strait of Hormuz is blocked? Saudi Arabia and other Gulf States have broken off diplomatic relations with Qatar over its 7.5 billion dollar support for the Muslim Brotherhood in Egypt and refuse to allow it a pipeline across to the Mediterranean.

What plans do the Saudis have if the Gulf is blocked? What if there is again trouble in Egypt and Suez? The Saudis too would like a pipeline to the Mediterranean. But what happens as these players approach the Mediterranean's eastern coast? They are met first with Jordan, run by the Hashemite family expelled from Mecca, an unstable State carved out of the Jewish Homeland Mandate territory, composed of former PLO refugees and now Syrians. Then the pipeline must find a port -- either (horrors!)  in Syria which was run by the pseudo shi'ite Alawite clan as a secular dictatorship or -- horror of horrors! --  Israel.
For all the players the competition is about who can leach the most blood from the Europeans before the whole world goes down the tubes.

Europe turned to Russian gas and oil as an alternative when it was still the Soviet Union. Now Russia, troubled by sunni terrorism at home has its own 'understanding' with Iran and nuclear exports.
Crimea is a vital warm-water naval base for Russia. (Its other ports are frozen in winter.) It gives it access to Syria. It is is also vital for control of the Mediterranean. In the early 1970s NATO was worried that the Mediterranean was becoming a Soviet lake. The USSR was the main arms supplier to the most populous Arab country there, Egypt. It also controlled the Suez canal. The Soviets had bases along the North Africa coast and in Syria.

Today Egypt has washed its hands of Obama's USA (that supported the Muslim Brotherhood and undermined Mubarek).  It is now getting arms supplies from Russia. The Saudis, who fiercely oppose the Muslim Brotherhood's way to establish Islamic global dominance, are changing their long-established policy towards USA. They are pumping tens of billions of dollars into the anti-Muslim Brotherhood Egyptian regime. For a century a religio-industrial compact allowed the USA, the world's prime capitalist, industrial power and a desert-bound religious sect in Saudi Arabia to dominate world affairs together. The world is now in flux.

In 1973 Europeans were getting oil at under two dollars a barrel from a wide variety of suppliers throughout the Middle East and North Africa. When Arab armies attacked Israel while the nation was fasting on the Yom Kippur holy day, the Arab suppliers, formed their own cartel. With their Oil Weapon, they placed a total embargo on Europe and the USA. They demanded that the West cease from henceforth to support Israel. They declared that any country that did not change its foreign policy would get zero oil. President Nixon considered declaring a state of war.

Thanks to the European Communities each with an energy component (Coal and Steel, Euratom and the 'Common Market') Europe was able to survive. It did not have a real common foreign policy nor did it create an energy policy (we still don't have one!). In 1959 the three Communities had formed an 'Inter-executive Group' to coordinate national energy policy. But General de Gaulle not only froze such initiatives he reversed France's Middle East policy for the sake of cheap Arab oil. That only encouraged the setup for blackmail.

In 1973 Europe was able, however, to buy oil on foreign markets and swap it between Member States in the nascent Single Market to help them survive. Denmark and Holland (who saw no reason not to support the Jewish State of Israel) imported mainly from the Middle East.  Faced with a total cut-off, they were in dire straits. Oil was shared with the other EC countries who imported from elsewhere.

In December 1973 the European Summit in Copenhagen was disrupted by an uninvited delegation of Arab oil exporters. They were determined to see that their Oil Weapon had maximum effect and no 'European solution' that favoured Israel and democracy in the Middle East was undertaken.
The effect of the oil embargo was devastating on the economies. Factories closed or went on short time. Motorways were bare of cars and vehicles. There was mass unemployment.

The Arab Oil Exporters quadrupled the price again in 1979! This was the Second Oil Shock. It exercised the ratchet mechanism to boost prices, not untypical of all cartels. The Economist opined on 22 December 1979:

"OPEC's interests are increasingly inimical to those of the west. ... Their underlying interests will push them into actions that harm the rest of the world. ... Unrest in the Middle East often takes the form of austere reformist Islam, yet further reducing production. .. OPEC's existence, as a device for producing a floor (for minimum prices) under past gains, while leaving 'free market' forces which are nothing of the kind to push prices further upwards, does indeed reflect the interests of its members. .. When people talk or write about OPEC, in this materialist age, they turn first to the tools of economics. But politics is also a necessary part of the solution to the problem. The west's governments have to muster political weapons both to achieve their aims at home and to constrain OPEC's power abroad."

Cartels benefit from time to time when prices fall. Why? They wipe out any alternative supplier. Energy infrastructure takes time and investment. When oil prices crash, these programmes are binned. As the same article in the Economist prescribed, Europe needs to pass on the full price of oil to the consumer. Even more, it needs to maintain high prices for the long-term, by tariffs if necessary, so that conservation will become a way of life and native energy-making inside Europe is common.

That requires a fully-fledged Energy Community with democratic institutions and powers. How can this be done? It could start by placing solar panels on all buildings, public and private. Europe needs a common, intelligent grid. It could stop using tarmac for roads and replace them with safe, solar panels made out of reinforced glass. What's glass made of? Sand and we have plenty of that! Europe could thus become a major exporter of electricity to the world! I am sure our scientists can come up with many technologies if given half a chance. Freedom of thought is the great asset of European culture. Other nations with lots of sand seem in a cultural timewarp.

An Energy Community as a new SUPRANATIONAL institution would help resolve the dilemma over Ukraine. About 16 percent of Europe's gas comes via Ukraine. It could immediately become a member. But it requires major revision of the present EU to make it democratic according to the treaties.

It took nearly two decades for the oil price to fall to anywhere near 'free market' levels. That was due to squabble among the Arab OPEC members and world competition but little effort was made by Europeans to gain energy independence to avoid future blackmail. The Shah of Iran one of the most enthusiastic proponents for higher oil prices was replaced in 1979-80 by the shi'ite leader ayatollah Ruhollah Khomeini. Iran promptly got into a war with secularist Iraq. The sunnis were not to happy about the revolutionary terrorism of the shi'ites but both were in agreement of squeezing the Western lemon till the pips cracked.

So what did stupid Europe get? More blackmail by the cartel! By 1999 oil prices had fallen to around 9 dollars a barrel. The Economist magazine with its extensive intelligence and expertise forecast a long-term price of FIVE dollars a barrel. It was not alone. Western oil companies like BP and Shell said the same thing. But they were no longer in control of the game, or the taps. The Arab oil suppliers had nationalized the oil supplies, so many western companies were merely helpers and exporters of this Arab oil. The guys who could turn the taps off at will were at OPEC. When prices rose, they cut off supplies so that oil prices stayed high and rose higher. The others like the subservient western oil companies were left with their own cartels on downstream operations and financial operations. The oil-producers recycled their profits using short-term financial instruments like derivatives or bonds. At compound interest the petro-profits must now amount to a financial bubble multiple times the size of the real economy. (The US Treasury long ago identified five cartels operating in the oil industry at various chokepoints. Today we seem to have more.)

So what happened with the new century? The price tripled immediately in 2000. It then took a rocket trajectory upwards. This was the THIRD oil shock. Oil went from nine dollars to 147 dollars a barrel -- an increase 1633 per cent! At that price the oil exporter were extracting around 10 percent or more of world GDP for a product worth a couple of dollars in a free market. The International Energy Agency shows this THIRD oil shock is the most serious one. Oil prices have never been higher in real terms since the modern oil industry began in 1859. No wonder the EU is in the economic doldrums.

It is not only this generation of politicians that are acting stupidly. Immediately after the initiation of the Community system, politicians went into a nationalist relapse. International cartels pick off nation States like minnows! By not acting for decades Europeans have compound interest on their stupidity. Europe is still sleep-walking in a dreamland with its plans for 2020 and 2030.

Today  the implications of this ignorance has moved from amber Stupid to Red DANGER.

The Russian take-over and military invasion of Crimea is part of Russia's strategy to survive its own uncertain future. Russians are a highly educated people. They are capable of great achievements. But hindered by their own stupid ideologies, from atheistic Marxism to the present Putinism, they have been unable to compete with the West. Dimitry Medvedev wanted to turn Russia into a high tech society -- but that requires a free society with open democracy. Instead their economy and all political power is based on the export of gas and oil.

Putin knows the implications full well. He is an expert in oil and gas prices. His whole policy is based on these strategic raw materials. Properly applied these raw materials can lever Russia back to great power status after the collapse of the Soviet Union. He called it the 'greatest geopolitical catastrophe' of the last century. It was a geopolitical disaster, not a communist one. Russia was a centre of a world ideology -- communism. It gave the USSR world clout. Putin was the clever KGB officer that thought up the Plan B to restore Russia's fortunes. He wants to control not only Crimea, but access of non-Russian oil and gas that drives the world economy.

The new key for Russia as a world power is not ideology but energy. Today the EU imports more than half its energy with a third of its gas and oil coming from Russia. Some countries are 90 percent dependent on Russia. Germany is a main customer.

As a KGB officer in Germany he was well aware of Europe's dependency on imported oil and gas. In his time of secret service office, the 1980s, a major trans-Atlantic row broke out between the USA and Europe about financing Russian pipelines. It nearly tore NATO apart. Mrs Thatcher joined with her French and German colleagues and opposed Ronald Reagan. The Soviet pipeline row became one of the biggest political crises of the West since WW2. (See my book, Russia and the danger for the European Union, pp88ff second edition, published in 2000 and first edition 1995. It proposes a pan-European Energy Community that would drive the democratisation of both the European Community members and the Former Soviet Union and its former satellite States.)

Why did Putin act now? He is in a race against time. Previously Russia had pledged its great support for the international rule of law. Now he has permanently lost any claim to that. The population of Crimea may be pro-Russian. There may be unsavoury characters in Kyiv. Khrushchev, acting as the Dictator of the Proletariat, may have acted foolishly to declare Crimea Ukrainian. But to move in Russian troops, to take-over all the communications, to force a referendum without a debate and then sign it off as a legal act in the Kremlin won him the condemnation of all other countries as a patent lack of legitimacy. Putin retorted that NATO had also broken its promises not to expand. The colour of the Russian policy is clear from the fact that it took over a gas plant outside the area of Crimea.

Acting like a bandit State is a severe loss to Russia's prestige -- after the Sochi Olympic games that won it acclaim. Why did he do it? He faced open hostility with the Saudis over the outcome in Syria, even threats of terrorism at Sochi. Instead Putin moved his armed forces to protect Sochi from terrorism. It turned out (coincidently?) to be very handy for taking over Crimea.

The rapid and smooth turn of events that caught the west by surprise indicate strategic planning. Without the exorbitant price that Europeans are paying for its gas, Russian economy would crash, its people starve. The Russian State and its budget depends on the viability of the huge energy monopoly, Gazprom. For President Vladmir Putin it is now a race against time to save his country. Two factors threaten Russia's future: price and the bust-up of a cartel operation.

Russia fixed its gas price in parallel with the oil market. Why? This was the highest price Russia could get. When the Netherlands was under total oil embargo, it found it had huge gas deposits. So taking a leaf from OPEC, it set the price as high as it could to be able to survive. Russia merely copied this ploy, although there is no good reason why European consumers should support another cartel dictating prices.

There is no real free market in oil and gas. It is run by numerous cartels. This has been going on for more than a century. In the 1950's the US Treasury identified FIVE cartels that worked in conjunction to control high prices to the customers. They ranged from exploration cartel, to down stream retailing and we can now add a financial cartel that recycles vast amounts of oil and gas profits through banks and derivatives that are multiple size of the 'real economy'. You can control the price by stopping research, drilling, turning off the oil taps, creating refining bottlenecks or applying the massive oil profits to control the economy. Some analysts estimate that Goldman-Sachs boosted the price of oil by 30 dollars a barrel before the 2008 crash.

Russia's gas price is now threatened by shale gas. The USA is producing massive quantities and this has hugely cut price of gas. If Europe produces its own gas in such quantities in a free market or imports gas from the USA -- bang goes the Russian-based gas cartel. Today European industries pay more than twice as much for electricity as the USA, and pay four times the price for gas, according to BusinessEurope, the companies lobby group! That is the measure of a cartel vampire.

US President Obama wanted to declare red lines over the dubious origin of poison-gas weapons in Syria. However Putin took his 'smart pills' and made Obama and the State Department with its close links to Saudi oil look stupid. The greatest scandal is religious persecution and ethnicide that is happening by the invaders. Syria used to have vibrant Christian communities since the time of Christ. The Jews, who were there even longer, preserving precious manuscripts over many centuries, have now disappeared.

Meanwhile the massacres of Christians in Syria go unreported by the West. Why is the media muted? The destabilization of all countries in the eastern Mediterranean is only part of a global power game. The revolutionary Islamists who want to 'free Syria' behead Christians and those who are unable to pay the ransom after kidnapping. Christians who don't convert or agree to become dhimmis (subject peoples) and pay the dhimmi taxes are treated in the same way.

The West's leaders are numbed into silence at Islamist atrocities by decades of blackmail. They need to start taking anti-stupid pills.