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Italy’s Deputy Prime Minister Matteo Salvini escalated the ongoing standoff between the EU and Italy, saying he would bring down the government if the coalition’s budget deficit target was changed.

The remarks by Salvini, Italy’s de facto leader who has been enjoying a steady climb in public opinion polls as he has continued his hardline negotiating approach with the European establishment, were quoted by newspaper La Repubblica hours before the country’s prime minister, Giuseppe Conte, was scheduled to make an attempt in Brussels to convince the European Commission that the country’s budget is sound. That, as is widely known by now, include the 2.4% deficit goal for 2019 that has become a lightning rod for Commission objections.

“The 2.4 percent deficit target can’t be touched, otherwise I will bring down the government,” Repubblica quoted Salvini as saying in a telephone call to Conte. The report said Salvini was willing to make only minor concessions in next year’s spending plan.

For Savlini the threat of new elections poses little downside risk: according to a recent poll, most Italians view Salvini, the outspoken leader of the anti-immigrant League party, as the real head of government, with just one in six casting Prime Minister Giuseppe Conte in that role. The monthly survey in La Repubblica newspaper showed 58% considered Salvini the leader, while 16 percent picked Conte and 14 percent chose Luigi Di Maio, who heads the anti-establishment 5-Star Movement and is the co-head of the coalition government. Salvini and Di Maio are deputy prime ministers in Conte’s coalition government, which took office in June and which the Demos poll found that 58 percent of respondents support.

Since then, Salvini has continued to pull ahead of Luigi Di Maio, the country’s other deputy premier, as the public face of hardline opposition to the EU. Salvini’s League party rose to 36.2% in voter intentions in November, the fourth straight poll showing an increase, according to an Ipsos survey in newspaper Corriere della Sera. Five Star, which emerged as the biggest single party in March’s general election, slipped to 27.7% this month, from 28.7% in October.

New elections would therefore only further entrench the anti-establishment Salvini, cementing his negotiating position vis-a-vis Brussels.

In an attempt to boost his approval Di Maio, meanwhile, ruled out shrinking the number of people who would benefit from the government’s welfare and pension reforms, though he reiterated the government would look at ways to cut more waste and raise money by selling some key assets, according to Bloomberg citing news agency Ansa. According to La Repubblica, he is in agreement with Salvini on possibly shifting up to 4 billion euros ($4.5 billion) from other parts of the budget for more investments.

Meanwhile, Italy’s budget plans and spat with the European Union have roiled its bond and stock markets in recent weeks. Some, such as Fitch, have warned that Salvini’s threat is in fact the biggest risk facing Rome, namely that Italy’s government may not survive.

Early in November, the head of Fitch’s sovereign ratings, James McCormack, warned that uncertainty involving Italy’s coalition government is as great a risk for BTP investors as the budget for the simple reason that the government may not survive as its members are “too  different.”  Speaking on Bloomberg TV, the Fitch strategist said that there are not many things that the coalition partners agree on, and that raises questions about the government’s survival.

“We are not convinced that this coalition government is actually going to survive. It has very different coalition partners” and there are “not many things that they agree on”, McCormack said.

“Then the question becomes: what happens then? Political uncertainty is not finished in Italy,” he added, expecting Italian political fireworks to continue well into 2019. As a reminder, there is a November 30 deadline for the Italian budget to be approved by European Commission, which then has to pass Italy’s parliament by December 31, with an April 30 “Plan B” extended deadline for Italian approval.

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The Fitch analyst also said that if yields on Italian bonds go higher – whether with the active involvement of the ECB, which can be quite convincing as Berlusconi recalls all too well, or without – “this could force the Italian government to think of a different strategy.” Unless, of course, the contemplated strategy is precisely that of government collapse, which would fall right into Salvini’s hands.

While the standoff between Italy and Europe remains in the jawboning phase for now, the upcoming sequence of events will necessitate actions, and should the refusal to compromise by either Salvini of the EU continue, it is likely that the Italian “bond vigilantes” will have no choice but to send the spread between Italian and German bonds beyond 400bps, which the government has previously warned would be the “red line” for local banks, potentially triggering a deposit run among the Italian population which while entertained and enjoying the standoff between Savlini and Brussels, may soon grow more concerned about the safety of money it has saved in the bank.

via RSS https://ift.tt/2SbumPs Tyler Durden

French police used tear gas and a water cannon against protesters in the Champs Elysées, in the center of Paris, as “yellow vest” activists flooded the streets. 

Originally formed to protest rising fuel prices, the “yellow vest” protesters have evolved into a wider demonstration against President Emmanuel Macron’s government in recent weeks. 

BREAKING UPDATE: Situation At the Champs Élysée in central Paris is getting out of control as protests against rising fuel prices are continuing. Multiple people have been injured and there’s reportedly a lot of damage:#GiletsJaunes
🎥 @RemyBuisine pic.twitter.com/JxxCWXkYv4

— BNL NEWS (@BreakingNLive) November 24, 2018

Over 3,000 police officers have been reportedly mobilized to control the approximately 8,000 protesters – some of them masked, according to CNN. During the tense standoff with police, law enforcement officials were pelted with bottles before opening up with the tear gas and water cannon. 

More anti-riot police forces are amassing against the #GiletsJaunes protestants in Paris. #France #Macron

pic.twitter.com/XW4zOdovwD

— Ali Özkök – علي أزكوك (@Ozkok_) November 24, 2018

Riots in France 🇫🇷 #24novembre #giletsjaunes #france pic.twitter.com/xnx2d1Qm6D

— François Piraux (@F8Piraux) November 24, 2018

As chaos broke out in the streets of Paris, the Arc de Triomphe was barely visible as thick smoke blanketed the streets. 

Scene at #ChampsElysees #giletsjaunes #paris #24Novembre tear gas fills the air pic.twitter.com/FdgoggVLe5

— Charlotte Dubenskij (@CDubenskij_RT) November 24, 2018

At least eight Yellow Jackets were arrested by police around noon for throwing projectiles, according to Le Figaro, while one protester could be seen being dragged away by riot police. The protests spilled into the Subway at one point, disrupting traffic as several stations closed due to “malicious acts.” 

Make France great again RT @RT_com: Standoff between riot police and demonstrators in Paris continueshttps://t.co/U8IoNNfL2S #ChampsElysées #giletsjaunes #24novembre2018 #Paris #YellowVests pic.twitter.com/ZwZI1eiv1w

— page blanche ⚜️ (@kronik2foo) November 24, 2018

Saturday marks the second week of Yellow Jacket protests, sparked by rising fuel prices and a planned fuel tax set to be implemented on January 1, 2019. Macron’s government insists that the move is aimed at promoting environmntally friendly policies. During last wekend’s protest, a Yellow Jacket protester died in the southeastern region of Savoie after protesters surrounded a car and began kicking it. The driver accelerated to flee the scene and knocked the woman down. 

Predictably, French Interior Minister Christophe Castaner blamed the “far right” for the protests.

“Today, the far right has mobilised,” he told reporters. “The security forces perfectly anticipated this situation.” 

“Their freedom of expression will be guaranteed, but it must not be exercised to the detriment of security, public order and the right of everybody to come and go. There is no liberty without public order,” Castaner added. 

Conservative political leader Marine Le Pen slammed the accusations, calling them a “pathetic and dishonest” form of “political manipulation” by the French government. 

The protests couldn’t come at a worse time for Macron, who said he would govern like a Roman God, yet finds his approval rating in a major tracker poll has cratered to just 25%. 

the poll was conducted between November 9th and the 17th across 1,957 people.

Specifically, Macron saw a steep drop of four points from October, with only 4% of respondents saying they were “very satisfied” with the French President’s performance. 21% claimed to be “mostly satisfied”. –TheBurningPlatform

Meanwhile, French residents are not happy with the refugee camps and large migrant settlements which have appeared throughout the country, resulting in no-go zones and clashes between cultures.  

Across the border in Italy, Interior Minister Matteo Salvini’s approval rating has been steadily climbing as he presses forward with his anti-mass-migration Italy-first policies. 

Will Macron survive the next election?

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The ECB sovereign systemic risk indicator – capturing pressures on government funding – is approaching the levels seen at the peak of the 2011-12 Euro crisis, as Italian spreads over German yields rise.

And as risk soars, the European Union’s TARGET 2 (im)balances increased further in October.

As a reminder on TARGET2 liabilities (and assets), Norbert Häring  wrote for Handelsblatt earlier in the year,

…Hans-Werner Sinn, the former head of Ifo Institute for Economic Research, a leading economic think tank, told Handelsblatt the figure was basically worthless – an “unsecured credit against the euro system, which cannot be called in and which debtor countries pay no interest on.” A private company would simply write off the amount, he added.

…No one quite knows would happen to the Target2 system in the event of a high-deficit country leaving the euro system. Last year, ECB president Mario Draghi told the European parliament that any deficits would have to be repaid. But it appears that countries have no binding legal obligation to do so; it is simply “guidance” from the ECB.

…If Italy were to withdraw from the euro zone, its banks’ assets and liabilities would be redenominated in its new currency, which would probably see a steep fall in value. The question then would not only be whether Italy should pay its Target2 deficit, but how it possibly could. The Bank of Italy would almost certainly default on a bill for half a trillion euros.

The latest data shows TARGET 2 claims of (core) northern Euro countries (Germany, Netherlands, Luxembourg and Finland) reached a new high level of EUR1.318 trillion (70% of which represents the German claims), very close to the historical peak of June 2018. In parallel, TARGET 2 liabilities of the southern peripheral countries (Italy, Spain and Portugal) also increased further to EUR957 billion.

In contrast with Spain and Portugal, Italy’s TARGET 2 liabilities increased in each month since the market tensions associated with the emergence of the new Italian government last May.

As Goldman Sachs explains, the evolution of Euro area TARGET 2 (im)balances owes to two different underlying driving forces.

• A ‘malign driver’, reflecting a “flight to quality”, whereby deposits flee the banks of weaker peripheral countries for the relative safety of banks in stronger core countries. Concerns about the financial soundness of the domestic banking system (and/or perceived risks of an EMU breakup) may lead to deposit outflows and/or shifts in asset holdings from a country perceived as vulnerable towards another country in which assets are considered to be safer, reflecting a flight to quality.

• A ‘benign driver’, whereby central bank asset purchases from banks that hold their liquid balances in other Euro area countries (for example, a non-Euro area bank with its continental European subsidiary in Germany or the Netherlands) would lead countries’ TARGET 2 liabilities to increase.

And ‘malign’ strains are starting to show.

In contrast with domestic deposits (namely from residents in Italy) at the aggregated level – mostly reflecting the behaviour of households and non-financial corporations (Exhibit 11) – deposits from pension/insurance companies and other financial institutions have gradually decreased since last May amid greater volatility (Exhibit 12).

 

The optimistic assumption is that the magnitude of the ‘malign driver’ behind Italy’s TARGET 2 liabilities is relatively contained at present at around EUR100bn (information available until the end of October 2018).

But, more ominously, as Goldman concludes, the reduction of the credit exposure of both foreign investors and non-bank financial institutions (until September) – part of which have been transformed in cash deposits still in Italy – is already a warning signal.

And the latest available data reported in this analysis is prior to the tensions between Italian and EU authorities about the 2019 draft budget. In our view therefore there is a real risk that in the coming months we will observe Italy’s TARGET 2 liabilities being driven more by ‘malign’ than ‘benign’ forces.

Since deposits are more easily transferable than any other financial asset, the ‘malign’ driving force could be rapidly strengthened should political uncertainties and the likely upcoming confrontational debate between Italian and European authorities on the 2019 budget increase substantially.

In this respect, the EC recommendation to launch the EDP in response to Italy’s 2019 budget increases this risk, having in turn the potential to create additional political tensions.

We give the last word to Mike Shedlock who sums up the ignorance of the ever-growing situation succinctly:

“Claims that none of this matters and that there would be no consequences if Italy left the Eurozone and defaulted are as ridiculous as ever…

The harder people attempt to come up with reasons that none of this matters, the sillier they look.“

via RSS https://ift.tt/2zovAQH Tyler Durden

Heading into Sunday’s EU summit on Brexit, Spain had emerged as an unexpected last-minute hurdle, standing between Theresa May and a Brexit deal as it threatened to boycott the summit and veto the deal if it does not get new assurances that Madrid would have a strong say on how any post-Brexit treaty with London would apply to Gibraltar.

That appears to have been resolved after a long night of negotiations, when according to Reuters reports, Spain reached a deal with the EU on Gibraltar, clearing the way for the EU summit on Sunday to approve a Brexit deal with British Prime Minister Theresa May.

“Negotiations went on through the night with Spain and Britain. In a telephone conversation just now (European Council President Donald) Tusk and (Spanish Prime Minister Pedro) Sanchez reached an agreement on Gibraltar,” the source said. “The summit will go ahead.”

Fleeting headlines from Bloomberg provide some additional details on the negotiations outcome:

• *UK PUBLISHES LEGAL INTERPRETATION ON GIBRALTAR, AS SPAIN ASKED
• *GIBRALTAR GOVT SAYS IT WILL `STICK WITH BRITAIN’ IN FUTURE
• *GIBRALTAR WON’T BE INCLUDED IN EU, U.K. FUTURE DEALS: DRAFT

As for the Spanish Prime Minister, he too is now on board:

• *SPANISH PM PEDRO SANCHEZ SPEAKS IN MADRID NEWS CONFERENCE
• *SANCHEZ: SPAIN REACHES GIBRALTAR ACCORD
• *SANCHEZ: SUMMIT TO GO AHEAD
• *SANCHEZ: SPAIN TO VOTE FOR BREXIT

Ahead of the report, Spanish Prime Minister Pedro Sanchez said he was ready to thwart Theresa May’s hopes of seeing EU leaders sign off on promises of close ties with London after Britain leaves the bloc in March if he did not get his way. According to Reuters, Brussels diplomats and representatives of other governments across Europe had said they did not believe Madrid would upset the “careful choreography of Sunday’s summitry”, when the UK prime minister and her 27 EU peers fly in for a couple of hours in the morning.

But they also heard strong words from Spanish ministers that left them unwilling to call Sanchez’s bluff without further talks.

Late on Friday, Sanchez had warned that “the guarantees are still not enough and Spain maintains its veto to Brexit. If there is a deal, then it will be lifted. If there is no deal … the European Council will most likely not take place.”

In the end, Spain – which appears to have gotten what it wanted following the all-night negotiations, with details still pending – the Sunday summit will now go ahead.

Just ahead of the report on the Gibraltar agreement, on Saturday EU summit chair Donald Tusk said that the Brexit summit was now closer to going ahead as planned after he spoke to the Spanish prime minister. “After the phone call between (European Council President Tusk) and (Spanish Prime Minister Pedro Sanchez) a few minutes ago, we are closer to tomorrow’s (European Council),” Tusk’s spokesman said on Twitter.

Gollowing the report of the Gibraltar deal, Tusk tweeted again that he will “recommend that we approve on Sunday the outcome of the #Brexit negotiations. No one has reasons to be happy. But at least at this critical time, the EU27 has passed the test of unity and solidarity.”

I will recommend that we approve on Sunday the outcome of the #Brexit negotiations. No one has reasons to be happy. But at least at this critical time, the EU27 has passed the test of unity and solidarity. https://t.co/N3EexasL2n

— Donald Tusk (@eucopresident) November 24, 2018

* * *

So now that the Gibraltar hurdle has been overcome, it’s important to remember that Spain’s threats about opposing the Brexit plan over Gibraltar (and France, the Netherlands and Belgium’s threats about opposing it over access to UK fisheries) are only a temporary distraction.

As we reported overnight, the EU doesn’t need unanimity to approve the final Brexit treaty and accompanying ‘political statement’ (though the EU parliament will need to approve the deal after the UK, and any final trade deal reached at the end of the post-Brexit transition period would require unanimous approval by the member states), and while the EU has placed tremendous emphasis on presenting a united front, it’s doubtful that the negotiators and sherpas who have put so much effort into hammering out the current 580+ page draft deal (and the accompanying 26 page framework for negotiations on a post-Brexit trade relationship) would let all of that work go to waste.

And now that the Brexit plan will most likely to finalized on Sunday at the planned weekend summit – with Spain’s blessing – on Monday, the focus will shift back toward Theresa May and her increasingly fraught relationship with Brexiteers within her own party.

May’s internal opposition is already near the threshold needed to force a leadership challenge within the conservative party. Most of their objections are related to the wording of the ‘Irish backstop’, which has caused a lot of trouble for a piece of the agreement that’s designed to, under ideal circumstances, never come into effect. According to the current terms, if no deal is reached, the UK would remain in a customs union with the EU until both sides sign off. That, according to the Brexiteers, would risk leaving the UK stuck as a “vassal state” under the thumb of a possibly vengeful EU.

And with the March 29 ‘Brexit Day’ looming ever closer, May is quickly running out of options (even her attempt to win Tories over with the so-called “fantasy unicorn” option of possibly replacing the backstop with a commitment to leverage technology that hasn’t even been invented yet to prevent a hard border on the island of Ireland failed to placate her Brexiteer colleauges). The EU, for its part, has said it is done negotiating, and it’s unclear what, if anything (aside from an imminent no-deal Brexit), could entice them to return to the table.

With that in mind, May and her Continental counterparts have probably already started looking at the different permutations of what could happen in Parliament over the next week. Before we embark on this treacherous journey through the minutiae, here is Citi’s “simplified” flowchart for the next steps…

 

To that end, Bloomberg has created a handy guide, which we have augmented with some additional commentary and charts. Here are some of the most probable outcomes assuming May can’t get the draft Brexit plan passed during a vote expected next month.

Go Back to Parliament

By now, anybody who has been paying attention to the increasingly tedious Brexit drama probably understands that the only person who believes that the draft plan can pass Parliament is the prime minister. If she brings it up for a vote in the House of Commons next month, she will probably lose. If she does, she could wait for what many expect will be an “adverse market reaction” to effectively threaten her rebellious Tory colleagues into falling in line (in a scenario that has been compared with the passage of the TARP package in the US back in 2008). May’s line would be: The EU has closed the door on future talks. This is the deal. It’s not changing. It’s this, or a “no deal” Brexit that would risk total unmitigated chaos.

However, a plan that is entirely reliant on an adverse market reaction could be thwarted by markets just as easily.

The problem with the whole TARP/Brexit thing is that expectations are difficult. If people believe voting against the deal will cause the pound to drop, and people in markets think that will cause the deal to pass the second time, then the pound won’t drop in the first place.

— Mike Bird (@Birdyword) November 22, 2018

Go Back to the EU

Parliament has sent a message: This doesn’t work for us, we want more. So May goes back to Brussels, hat in hand, and asks for more. It’s possible Brussels could try and sweeten the deal. But the likelihood that a dramatic change surrounding the backstop can be made is low.

May Quits

She’s had enough. So much for the “national interest”, May has given this thing her all, and has decided to quit while she’s ahead. The Tories would hold an instant leadership election. Whoever wins would be faced with much the same options. May has said she has no intention of resigning.

As a reminder, here’s a chart showing the most popular politicians in the UK (courtesy of Statista).

Conservative Confidence Vote

Rebellious Tories came close last week to securing the 48 letters of no confidence needed to force an intraparty leadership challenge.

If they succeed in securing that number, a leadership election will be called. It’s widely expected that May would win. But if for whatever reason the vote count turns against her, it’s likely she would resign. If she wins, her grip on power will be secure – Tories won’t be able to call another no confidence vote for a year. But nothing material will have changed.

Government Confidence Vote

Now we’re starting to get into the more extreme possibilities. Only seven Tory turncoats would be needed to join with the opposition to call a general government-wide confidence vote. The Fixed Term Parliaments Act says that if the government loses a confidence vote in Parliament, it has 14 days to win one. If it doesn’t, another general election must be held. That could take months. Members of May’s government have said in the past that if they lost the Brexit vote, they could call a confidence vote. However, Brexiteers have said in response that, while they’d be happy to kill the draft Brexit plan, they wouldn’t risk voting down the government. By rebelling against the government, turncoat Tories would risk being expelled from the party. Then again, the 10 DUP MPs who have repeatedly expressed their frustration with the deal could also bring down the government.

The failure of May’s government, and an ensuing general election, would likely mean chaos in markets as the ‘uncertainty’ that May often speaks about would be ratcheted up to absurd new heights.

Second Referendum

If Parliament can’t decide, then give the people another shot. May has repeatedly insisted that there won’t be another referendum under any circumstances. But Wall Street has put the probability of a second referendum as high as 30%.

Even if another referendum was called, it would take months to hold a vote. So the EU would need to extend Britain’s negotiating period. And Parliament would need to make certain considerations.

No Deal

If May’s fractious Tory caucus can’t get behind the deal, then ‘no deal’ it is. That would be a hard sell politically. The country is believed to be woefully unprepared for food and medicine shortages that economists have warned about. There has been talk of traffic jams in both the EU and UK as customs barriers rise. Then again, it’s also possible that the pain would be transitory, and it would only create further incentive for both sides to hammer out a trade agreement, maybe one similar to the ‘SuperCanada’ deal that Brexiteers have been trying to sell. While members of May’s cabinet, and May herself, have insisted that no deal won’t happen, it’s not clear how it would be prevented.

Go For Norway

Parliament doesn’t want No Deal, so let’s got for the closest possible relationship to the EU instead. Some Tories have been pushing this approach recently. However, as Open Europe points out, given the wording of the leaked political statement draft, a Norway-style trade agreement is unlikely.

A leaked version of the declaration sets out a spectrum of possibilities for the future partnership, ranging from a “Canada-plus” comprehensive Free Trade Agreement, to what might be termed a “Chequers-minus” deal. Where the final agreement falls on this scale will depend broadly on how far the UK is willing to align with EU rules, and, correspondingly, how much it would accept in terms of level playing field obligations and an indirect role for the European Court of Justice.

The text does not provide a clear path to a Norway-plus agreement, where the UK remains integrated in the four freedoms of the EU single market.

It’s also unlikely to garner the support among the Tories that would be needed to make it a suitable alternative to the current deal.

Call a General Election

There’s already legislation in play to call for a general election. But Tories are too fearful of relaxing their already tenuous grip on power and losing control to Labour. It’s more likely that a general election would follow a vote of no confidence in the government. 

Government of National Unity

What many Americans don’t realize about the Brexit situation is that there already is a comfortable majority in Parliament to support the deal – it’s just spread between different parties. And Labour MPs who break ranks to back May’s plan could risk expulsion from the party, as party leader Jeremy Corbyn has come out against it.

Assuming ‘no deal’ is averted, negotiations over the future trade relationship between the EU and the UK would begin. Given the fraught nature of the Brexit treaty talks, this will almost certainly be another trainwreck requiring the squaring of many opposing interests.

As it stands, here’s a chart of some of the most likely scenarios for the future trade deal, compared with what the UK has now.

The non-binding withdrawal agreement that’s still being hammered out in Europe is supposed to set a framework for these negotiations.

The 26-page document that leaked yesterday includes many stipulations, all of which are non-binding. Here’s a rundown of the big points, courtesy of Open Europe.

Movement of goods

• Both sides “envisage comprehensive arrangements that will create a free trade area, combining deep regulatory and customs cooperation.” The objective is for a relationship that is “as close as possible,” rather than the “frictionless” trade the Prime Minister had previously suggested. Nor is there any reference to the government’s Chequers proposal for a “common rulebook.”
• The latest version of the declaration suggests the UK and EU would “build and improve on” the single customs territory set out in the backstop as regards tariffs, “in line with the Parties’ objectives and principles above.” The reference to the Parties’ principles refers back to “respecting the integrity of the Union’s single market and the customs union” and “recognising the development of an independent trade policy by the United Kingdom.” This is an adjustment from the previous draft that suggested only that the future customs arrangement would “build on” the backstop – a provision that former Brexit Secretary Dominic Raab felt went too far.
• Elsewhere, the declaration also notes, “The Parties envisage making use of all available facilitative arrangements and technologies” as part of the future customs agreement, including in order to address the Irish border. This leaves open the possibility of considering a deep customs facilitation agreement, or a modified version of the UK government’s Maximum Facilitation proposal, in negotiations on the future relationship.
• Similarly, it notes that the future economic partnership should “ensure the sovereignty of the UK and the protection of its internal market…including with regard to the development of its independent trade policy.” This is seemingly in tension with a long-term UK-EU customs union.
• On regulation, the document notes the potential for UK alignment with EU rules in relevant areas, in particular to allow for cooperation with the European Medicines Agency, the European Chemicals Agency and the European Aviation Safety Agency.
• In all, the declaration notes a “spectrum of different outcomes” for checks and controls on bilateral trade in goods is possible. While a Chequers-style agreement on goods is not signposted, the declaration suggests that that the UK and EU could ensure fewer barriers to market access if the UK agrees to align with EU rules.

The backstop and customs

• It is not clear whether the proposals for an economic partnership set out in this document would meet the criteria necessary to supersede the backstop – and therefore whether the future economic partnership would be available to the whole of the UK, including Northern Ireland.
• The document states both sides’ “determination to replace the backstop solution on Northern Ireland by a subsequent agreement that establishes alternative arrangements for ensuring the absence of a hard border on the island of Ireland on a permanent footing.” The language has strengthened slightly – the previous outline declaration noted both sides’ “intention” to replace the backstop. It also states that trade and investment facilitation should respect the integrity of the UK’s internal market.
• It notes that “facilitative arrangements and technologies will also be considered in developing any alternative arrangements for ensuring the absence of a hard border on the island of Ireland on a permanent footing.” The leaves a path for the UK to offer technological solutions, in the vein either of its Maximum Facilitation proposal or its Facilitated Customs Arrangement, to ensure an open Irish border – potentially offering a route away from the backstop arrangement on customs. However, this is unlikely to offer sufficient reassurances to Unionists in Northern Ireland that they would not be treated differently to the rest of the UK under the future partnership.
• No further role is set out for Northern Ireland institutions in determining whether or not the conditions for replacing the backstop have been met.

Services

• As expected, the Political Declaration broadly sets out traditional third country arrangements in services. It states both sides’ intention to “[build] on recent Union Free Trade Agreements,” but is thin on detail.
• In financial services, both sides commit to assessing equivalence before the end of June 2020 – the intention is therefore for an equivalence regime to be ready to be phased in at the end of the transition.
• The declaration allows for a data adequacy decision for the UK, and aims to ensure this can be adopted by the end of 2020 – again allowing for this framework to be phased in at the end of the transition.
• Both sides commit to establishing a Comprehensive Air Transport Agreement, ensuring “comparable market access” for road transport, and agreeing bilateral agreements on rail transport.

Level playing field

• Provisions included in the outline political declaration to “build on” the level playing field commitments agreed in the Withdrawal Agreement have been maintained. It notes that these commitments should “have regard to the scope and depth of the future relationship” – this allows a route for the EU to scale up level playing field obligations if the UK pursues deeper regulatory alignment.

Fishing

• A future agreement on fisheries, covering access to waters and quota shares, will be established “within the context of” the overall economic partnership. However, this does not mean that fishing rights will be negotiated as part of the trade agreement, and falls short of the “no fish, no deal” commitment that some EU member states were reportedly pushing for.
• The declaration notes that the UK and EU will “use their best endeavours” to conclude the fisheries agreement by July 2020 – the same deadline as is required for a decision to extend the transition period, as per the Withdrawal Agreement.

Law Enforcement and Police Cooperation

• The document states, “The closer and deeper the partnership, the stronger accompanying obligations” for the UK. It notes that the UK has agreed to remain a party of the European Convention of Human Rights (ECHR), and to respect the jurisdiction of the ECJ in the interpretation of EU law.
• Both parties are aiming for continued UK operational cooperation with Europol. The government’s previous proposals sought to go beyond such an operational agreement, which would not grant the UK a direct access to Europol databases. The Political Declaration does not make it clear whether this is possible or not.
• The document mentions maintaining cooperation in relation to exchanging Passenger Name Records (PNR) and Prüm databases (to which currently non-Schengen countries do not have access). But there is nothing on possible UK access to Schengen Information System (SIS II), or the European Criminal Records Information System (ECRIS), which the Prime Minister indicated would be addressed in further negotiations.
• In line with previous EU statements, the UK will no longer be a part of the European Arrest Warrant, but both sides state their commitment to a streamlined and time-limited extradition procedure.

Foreign policy, security and defence

• Both parties plan for the future relationship to “enable the UK to participate on a case by case basis in CSDP missions” through a Framework Participation Agreement (FPA).This would allow the UK to second staff to missions/headquarters, but not take part in decision-making.
• The UK will also be allowed to take part in projects of the European Defence Agency (EDA), the European Defence Fund and the Permanent Structured Cooperation (PESCO) on “an exceptional basis.” It is important to note that the conditions for third party participation in PESCO have not been yet agreed. European diplomats have reportedly decided to postpone the decisions until negotiations over the terms of the UK’s withdrawal are concluded.
• Both parties agree to consider “appropriate arrangements” for the UK’s participation in the EU’s space satellite programmes, reflecting continued disagreement over the UK’s access to Galileo’s secure system.

Free movement of people

• The declaration specifically notes “the ending of free movement of people between the Union and the United Kingdom.”
• The provisions on mobility remain thin, recalling commitments to “non-discrimination” between member states, and “full reciprocity.” The Common Travel Area between the UK and Ireland remains protected, however.
• The declaration also aims to ensure “the temporary entry and stay of natural persons for businesses purposes in defined areas.”
• Both sides aim to provide visa-free travel for short-term visits, and consider different conditions to entry for study, research and youth exchanges.

Governance

• The document states that the overarching institutional framework for the UK-EU partnership could be an Association Agreement – this was a clear ambition of the European Parliament. The declaration leaves open the possibility that some discrete bilateral agreements could sit outside this structure, subject to other governance arrangements.
• The governance architecture of the future relationship is broadly expected to follow that set out within the Withdrawal Agreement.
• The bilateral relationship will be supervised by a UK-EU Joint Committee. Both parties can also refer to the Joint Committee for dispute resolution.
• Where the Joint Committee cannot decide a dispute, it may refer this to an independent arbitration panel, whose decisions are binding on the UK and EU. However, if a dispute raises a question of EU law, the interpretation of the EU law should be decided only by the ECJ – not independent arbitration.
• This governance structure was largely to be expected. In any economic relationship with the EU, the UK cannot expect fully to insulate itself from the role of the ECJ, given the EU’s stated legal autonomy. However, under this system, the ECJ would not have direct jurisdiction in the UK, and would only have authority to decide in areas where the UK agreed to apply EU law. The less regulatory integration between the UK and EU, the more restricted the role of the ECJ.

The upshot, is that the document envisions a strong free-trade relationship between the UK and the EU, but one that’s far less integrated than what exists today.

And as a bonus for making it through all that, here is the simplest flow chart of ‘what happens next’ (and the odds of it happening) we have come across so far…

 

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Authored by Mohamed El-Erian via Project Syndicate,

The singular issue of Brexit has consumed the United Kingdom for two and a half years. The “if,” “how,” and “when” of the country’s withdrawal from the European Union, after decades of membership, has understandably dominated news coverage, and sidelined almost every other policy debate. Lost in the mix, for example, has been any serious discussion of how the UK should boost productivity and competitiveness at a time of global economic and financial fluidity.

At the same time, the rest of the world’s interest in Brexit has understandably waned. The UK’s negotiations with the EU have dragged on through multiple déjà vu moments, and the consensus is that the economic fallout will be felt far more acutely in Britain than in the EU, let alone in countries elsewhere.

Still, the rest of the world is facing profound challenges of its own. Political and economic systems are undergoing far-reaching structural changes, many of them driven by technology, trade, climate change, high inequality, and mounting political anger.

In addressing these issues, policymakers around the world would do well to heed the lessons of the UK’s Brexit experience.

When Britons voted by a margin of 51.9% to 48.1% to leave the EU, the decision came as a shock to experts, pundits, and Conservative and Labour Party leaders alike. They had underappreciated the role of “identity” as a driving force behind the June 2016 referendum. But now, voters’ deeply held ideas about identity, whether real or perceived, can no longer be dismissed. Though today’s disruptive politics are fueled by economic disappointment and frustration, identity is the tip of the spear. It has exposed and deepened political and social divisions that are as uncomfortable as they are intractable.

Experts also predicted that the UK economy would suffer an immediate and significant fall in output following the 2016 referendum. In the event, they misunderstood the dynamics of what economists call a “sudden stop” – that is, abrupt, catastrophic dysfunction in a key sector of the economy. A perfect example is the 2008 global financial crisis, when financial markets seized up as a result of operational dislocations and a loss of mutual confidence in the payments and settlement system.

Brexit was different. Because you cannot replace something with nothing, there was no immediate break in British-EU trade. In the absence of clarity on what type of Brexit would ultimately materialize, the economic relationship simply continued “as is,” and an immediate disruption was averted.

It turns out that when making macroeconomic and market projections for Brexit so far, “short versus long” has been more important than “soft versus hard” (with “hard” referring to the UK’s full, and most likely disorderly, withdrawal from the European single market and customs union). The question is not whether the UK will face a considerable economic reckoning, but when.

Nonetheless, the UK economy is already experiencing slow-moving structural change. There is evidence of falling foreign investment and this is contributing to the economy’s disappointing level of investment overall. Moreover, this trend is accentuating the challenges associated with weak productivity growth.

There are also signs that companies with UK-based operations have begun to trigger their Brexit contingency plans after a prolonged period of waiting, planning, and more waiting. In addition to shifting investments out of the UK, firms will also start to relocate jobs. And this process will likely accelerate even if British Prime Minister Theresa May manages to get her proposed exit deal through Parliament.

The Brexit process thus showcases the risks associated with economic and political fragmentation, and provides a preview of what awaits an increasingly fractured global economy if this continues: namely, less efficient economic interactions, less resilience, more complicated cross-border financial flows, and less agility. In this context, costly self-insurance will come to replace some of the current system’s pooled-insurance mechanisms. And it will be much harder to maintain global norms and standards, let alone pursue international policy harmonization and coordination.

Tax and regulatory arbitrage are likely to become increasingly common as well. And economic policymaking will become a tool for addressing national security concerns (real or imagined). How this approach will affect existing geopolitical and military arrangements remains to be seen.

Lastly, there will also be a change in how countries seek to structure their economies. In the past, Britain and other countries prided themselves as “small open economies” that could leverage their domestic advantages through shrewd and efficient links with Europe and the rest of the world. But now, being a large and relatively closed economy might start to seem more attractive. And for countries that do not have that option – such as smaller economies in East Asia – tightly knit regional blocs might provide a serviceable alternative.

The messiness of British party politics has made the Brexit process look like a domestic dispute that is sometimes inscrutable to the rest of the world. But Brexit holds important lessons for and about the global economy. Gone are the days when accelerating economic and financial globalization and correlated growth patterns went almost unquestioned. We are also in an era of considerable technological and political fluidity. The outlooks for growth and liquidity will likely become even more uncertain and divergent than they already are.

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The UK’s Secret Intelligence Service, otherwise known as MI6, has been scrambling to prevent President Trump from publishing classified materials linked to the Russian election meddling investigation, according to The Telegraph, stating that any disclosure would “undermine intelligence gathering if he releases pages of an FBI application to wiretap one of his former campaign advisers.” 

Trump’s allies, however, are fighting back – demanding transparency and suggesting that the UK wouldn’t want the documents withheld unless it had something to hide. 

The Telegraph has talked to more than a dozen UK and US officials, including in American intelligence, who have revealed details about the row. 

British spy chiefs have “genuine concern” about sources being exposed if classified parts of the wiretap request were made public, according to figures familiar with discussions.

“It boils down to the exposure of people”, said one US intelligence official, adding: “We don’t want to reveal sources and methods.” US intelligence shares the concerns of the UK. 

Another said Britain feared setting a dangerous “precedent” which could make people less likely to share information, knowing that it could one day become public. –The Telegraph

The Telegraph adds that the UK’s dispute with the Trump administration is so politically sensitive that staff within the British Embassy in D.C. haver been barred from discussing it with journalists. Theresa May has also “been kept at arms-length and is understood to have not raised the issue directly with the US president.” 

In September, we reported that the British government “expressed grave concerns” over the material in question after President Trump issued an order to the DOJ to release a wide swath of materials, “immediately” and “without redaction.” 

Trump walked that order back days later after the UK begged him not to release them. 

Mr Trump wants to declassify 21 pages from one of the applications. He announced the move in September, then backtracked, then this month said he was “very seriously” considering it again. Both Britain and Australia are understood to be opposing the move. 

Memos detailing alleged ties between Mr Trump and Russia compiled by Christopher Steele, a former MI6 officer, were cited in the application, which could explain some of the British concern. –The Telegraph

I met with the DOJ concerning the declassification of various UNREDACTED documents. They agreed to release them but stated that so doing may have a perceived negative impact on the Russia probe. Also, key Allies’ called to ask not to release. Therefore, the Inspector General…..

— Donald J. Trump (@realDonaldTrump) September 21, 2018

….has been asked to review these documents on an expedited basis. I believe he will move quickly on this (and hopefully other things which he is looking at). In the end I can always declassify if it proves necessary. Speed is very important to me – and everyone!

— Donald J. Trump (@realDonaldTrump) September 21, 2018

The New York Times reported at the time that the UK’s concern was over material which “includes direct references to conversations between American law enforcement officials and Christopher Steele,” the former MI6 agent who compiled the infamous “Steele Dossier.” The UK’s objection, according to former US and British officials, was over revealing Steele’s identity in an official document, “regardless of whether he had been named in press reports.” 

We noted in September, however, that Steele’s name was contained within the Nunes Memo – the House Intelligence Committee’s majority opinion in the Trump-Russia case.

Steele also had extensive contacts with DOJ official Bruce Ohr and his wife Nellie, who – along with Steele – was paid by opposition research firm Fusion GPS in the anti-Trump campaign. Trump called for the declassification of FBI notes of interviews with Ohr, which would ostensibly reveal more about his relationship with Steele. Ohr was demoted twice within the Department of Justice for lying about his contacts with Fusion GPS. 

Perhaps the Brits are also concerned since much of the espionage performed on the Trump campaign was conducted on UK soil throughout 2016. Recall that Trump aid George Papadopoulos was lured to London in March, 2016, where Maltese professor Joseph Mifsud fed him the rumor that Russia had dirt on Hillary Clinton. It was later at a London bar that Papadopoulos would drunkenly pass the rumor to Australian diplomat Alexander Downer (who Strzok flew to London to meet with). 

Also recall that CIA/FBI “informant” (spy) Stefan Halper met with both Carter Page and Papadopoulos in London. 

Halper, a veteran of four Republican administrations, reached out to Trump aide George Papadopoulos in September 2016 with an offer to fly to London to write an academic paper on energy exploration in the Mediterranean Sea.

Papadopoulos accepted a flight to London and a $3,000 honorarium. He claims that during a meeting in London, Halper asked him whether he knew anything about Russian hacking of Democrats’ emails.

Papadopoulos had other contacts on British soil that he now believes were part of a government-sanctioned surveillance operation. –Daily Caller

In total, Halper received over $1 million from the Obama Pentagon for “research,” over $400,000 of which was granted before and during the 2016 election season. 

Papadopoulos, who was sentenced to 14 days in prison for lying about his conversations with a shadowy Maltese professor and self-professed member of the Clinton Foundation, has publicly claimed he was targeted by UK spies, and told The Telegraph that he demands transparency. Trump’s allies in Washington, meanwhile, have suggested that the facts laid out before us mean that the ongoing Russia investigation was invalid from the start. 

In short, it’s understandable that the UK would prefer to hide their involvement in the “witch hunt” of Donald Trump since much of the counterintelligence investigation was conducted on UK soil. And if the Brits had knowledge of the operation, it will bolster claims that they meddled in the 2016 US election by assisting what appears to have been a set-up from the start.

Steele’s ham-handed dossier is a mere embarrassment, as virtually none of the claims asserted by the former MI6 agent have been proven true. 

Steele, a former MI6 agent, is the author of the infamous and unverified anti-Trump dossier. He worked as a confidential human source for the FBI for years before the relationship was severed just before the election because of Steele’s unauthorized contacts with the press.

He shared results of his investigation into Trump’s links to Russia with the FBI beginning in early July 2016.

The FBI relied heavily on the unverified Steele dossier to fill out applications for four FISA warrants against Page. Page has denied the dossier’s claims, which include that he was the Trump campaign’s back channel to the Kremlin. –Daily Caller

That said, Steele hasn’t worked for the British government since 2009, so for their excuse focusing on the former MI6 agent while ignoring the multitude of events which occurred on UK soil, is curious. 

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Authored by Bernard Connolly via The Spectator,

Four years ago, 45 per cent of Scottish voters favoured leaving the UK. Many of the warnings about the negative impact of independence on the Scottish economy were justified. But they did not extinguish a yearning for independence – and the same could be said of the EU referendum, with the caveat that this time a majority voted to leave, and many of the warnings were unjustified.

An ineradicable desire to get our country back triumphed over the Project Fear campaign conducted by the Treasury and the whole of the nomenklatura that sought to preserve position, power and privilege for itself and to suppress any notion that ordinary people, in Britain or in any other European country, could have a say in how they are governed.

In part, that triumph came because of the risible – and dubiously motivated – nature of the economic argument for staying in as presented by assorted anti-Brexit ‘experts’; the ‘experts’ who habitually get the big questions wrong.

Indeed, I believe that on the balance of probabilities the longer-term impact of Brexit on the British economy will be favourable.

Now we’re being told that leaving the EU without a deal would be economically catastrophic.

Curiously, those same ‘experts’ didn’t flag up such purported risks associated with Scotland leaving the EU and the UK without a deal four years ago; and Scottish independence would have inevitably been a no-deal exit from both. The EU, and for that matter the rest of the UK, could not have negotiated any kind of trade arrangement with Scotland until it became a sovereign state – that is, until it was already out of the UK and thus out of the EU. Yet no one suggested, as they now suggest about Brexit, that ‘no deal’ would mean the imposition of a blockade. Not even the most ardent unionists warned of plagues of super-gonorrhea and of Prime Ministers being deprived of insulin. Why not?

The answer says a lot about the true nature of the EU and its attitudes to Britain, which are very different from English attitudes to Scotland.

But economics first. The Treasury’s notorious short-term prediction of immediate recession, rocketing unemployment and a ‘punishment Budget’ if Leave won has been shown to be utterly, scandalously wrong. For one thing, it assumed that fiscal and monetary policy would become more restrictive if Leave won. That aspect of their dire warnings was proved false the very day after the referendum. But even to have threatened that the people would be punished for voting in the ‘wrong’ way was disgraceful.

The Treasury’s emanations are nearly always wrong. Yet the organs of the establishment trot out the Treasury’s even more fantastical medium-term and long-term warnings of income foregone after we’ve left the EU empire, even with a deal. Its assessment of the Brexit impact on productivity growth is based on the so-called gravity model of trade. Unsurprisingly, however, the Treasury model, despite being used by a highly-politicised body, ignores the most important aspect of the relationship: what happens to the power of those in charge when trade arrangements change?

The gravity model has been based mainly on the experience of the integration of previously backward and/or communist countries into the capitalist world economy. When operated in the Treasury’s biased way, it attributes just to the volume of trade impacts that should be attributed to an associated institutional and political improvement, and in particular a reduction in the exploitative power of rent-seeking organisations, whether public (the state) or private (big landlords and monopoly firms).

The Treasury thus reverses the correct sign of the productivity impact of Brexit. There will be substantial long-run Brexit gains in productive potential (a Corbyn/McDonnell government is an obviously important caveat to this but one less likely to be relevant in a no-deal scenario with a proper Conservative leader than in a May-capitulation scenario). The political system would become more democratic and open; the power of those in charge would be reduced; we would be freed from the EU’s protectionist customs union and could reduce tariffs with the rest of the world, whether reciprocally or unilaterally; and we would be freed from the anti-competitive (and very obviously anti-British) Single Market rules.

What about the threatened biblical plagues that will supposedly be visited on us if we leave without a deal? Why were these blood-curdling threats not made in the Scottish referendum? Quite rightly, no one would have believed such stories. No one would ever have imagined that the rest of the UK would have blockaded Scotland; and Brussels knew that if it had ordered Britain to institute a blockade that order would have been ignored, creating an immediate crisis for the whole EU edifice.

So why do Brussels and the civil service now make fearful threats about no deal? Where Brussels, Berlin and Paris are concerned, the answer is obvious. In the Scottish case, they reasoned on the principle that ‘my enemy’s [England’s] enemy [Scotland, as they saw it, ignoring three hundred years of shared history] is my friend.’ In the Brexit case, there is just an enemy – Britain – which must be impoverished, subjugated and humiliated. As for the domestic branch of the nomenklatura, one shudders to think what might be shaping its attitude.

The economic and, importantly, financial-system cost (and, even more, the security and defence cost) to the EU as a whole – and particularly to some individual EU countries, such as Ireland, and sectors, such as the German auto industry – of a no-deal Brexit and no FTA will be substantial. May’s deal, in contrast, would be very beneficial to the EU, allowing it to impose additional regulatory burdens on British firms and gain access to British markets on terms unfavourable to Britain, as bait in FTAs with other countries. So one can understand why the EU prefers May’s capitulation deal, even without taking into consideration the dreadful dilemma for the EU about the Irish border question it will have created for itself if there is no deal.

But if the trahison des clercs of the British Establishment is defeated, and we leave without a May-type deal, will the EU institute a punishment blockade? One hopes there will be bilateral side deals. But one cannot ignore the motivation of the EU. Its mindset is arguably that the war – a war against political legitimacy – has never ended. Britain is now the most vulnerable part of the ‘Anglo-Saxon’ world, as it was in 1803-05 and in 1940. The obstruction of supplies of food and medicines to Britain would in effect be an act of aggression – but simply a more overt act in what has always been a long-running fight against the ‘Anglo-Saxon model’.

So either no deal holds no terrors, or terrors have to be confronted, as we once confronted Napoleon. Defending our independence, and by extension that of every European people, from an historically vengeful European Empire is worth more than a container-load of avocados.

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Authored by Paul Craig Roberts,

Revenge Is Mine Saith Washington

Justice has disappeared in the West. In Justice’s place stands Revenge. This fact is conclusively illustrated by Julian Assange’s ongoing eight year ordeal.

For eight years Julian Assange’s life has been lived in a Kafka Police State. He has been incarcerated first under British house arrest and then in the Ecuadoran Embassy in London, despite the absence of any charges filed against him.

Meanwhile, the entirety of the Western world, with the exception of former Educadoran President Rafael Correa and a UN agency that examined the case and ruled Assange was being illegally detained by the UK government’s refusal to honor his grant of political asylum, has turned its back to the injustice.

Assange is locked away in the Ecuadoran Embassy, because to protect him from false arrest, former Ecuadoran President Correa gave him political asylum. However, the corrupt and servile UK government that serves Washington, and not justice or law, refused to honor Assange’s asylum. The US vassal known as the UK stands ready to arrest Assange on Washington’s orders if he steps outside the embassy and to hand him over to Washington, where a large number of both Democrats and Republicans in Congress have said he should be executed. The Trump regime, carrying on the illegal practices of its forebears, has a secret indictment waiting to be revealed once they have their hands on Assange.

The current president of Ecuador a servant of Washington, Lenin Moreno – a person so lacking in character that his name is an insult to Lenin – is working a deal with Washington to rescind Assange’s grant of asylum so that the Ecuadoran Embassy in London has to expel Assange into the hands of Washington.

What has Assange done? He has done nothing but to tell the truth. He is a journalist who heads Wikileaks, a news organization that publishes leaked documents – exactly as the New York Times published the leaked Pentagon Papers from Daniel Ellsberg. Just as the publication of the Pentagon Papers embarrassed the US government and helped to bring about the end of the senseless Vietnam War, the documents leaked to Wikileaks embarrassed the US government by revealing Washington’s war crimes, lies, and deception of the American people and US allies.

The allies, of course, were bought off by Washington and remained silent, but Washington intends to crucify Assange for the embarrassment and payoff expense he caused the criminal government in Washington.

In order to assert authority over Assange, Washington is using the extra-territoriality of US law, a claim that Washington bases not on law but on might alone and uses to violate the sovereignty of independent countries. Assange is a citizen of Australia and Ecuador. He is not subject to US law. Even if he were, he has committed no espionage. The false equivalence Washington is trying to establish between the exercise of the First Amendment and treason shows how totally lost are the American people. The silence of the US media demonstrates that the presstitutes don’t mind losing the First Amendment’s protection as they have no intention of telling any truths.

Washington’s secret indictment – it is secret so that two-bit punks such as James Ball can write in the Guardian that Assange faces no threat of arrest – most likely accuses Assange of espionage. But it is not legally possible to accuse a non-citizen operating outside the country of espionage. All countries engage in espionage. Every country on earth could accuse Washington of espionage and arrest the CIA. The CIA could, as it often has, accuse Israel of espionage. Of course, any Israeli, such as Jonathan Pollard, who is convicted of espionage in the US becomes a point of contention between Washington and Israel and Israel always wins. The corrupt Obama regime released Pollard from his life sentence on orders and, no doubt, generous bribes, from Israel.

If Assange were Israeli, he would be home free, but he is a citizen of two countries whose governments place high value on being Washington’s vassals.

There was a time in America, many decades ago, when the Democrats stood for justice and the Republicans stood for greed.

There was a time in America, prior to 9/11, when the media would have rushed to the defense of the freedom of the press and defended Assange from his mistreatment and false charges. To be sure that the reader understands the mistreatment of Assange, it is identical to the mistreatment of Cardinal Josef Mindszenty of Hungary whose asylum in the US Embassy in Budapest was not acknowledged by the Soviet government, forcing Mindszenty to live out all but three years of his remaining life in the US embassy.

President Nixon negotiated his release in 1971, but the Nixon haters give Nixon no credit for his attention to one man locked away in an injustice part of the earth.

Today there is no such attention to injustice except for the “victim” groups in Identity Politics. Where is the champion of Assange now that Rafael Correa has to live abroad to avoid persecution by Washington’s puppet Moreno?

The weakness of the intellect in the West is scary. Caitlin Johnstone tells us about it:

“Trump’s despicable prosecution of Assange, and corporate liberalism’s full-throated support for it, has fully discredited all of mainstream US politics on both sides of the aisle. Nobody in that hot mess stands for anything. If you’re still looking to Trump or the Democrats to protect you from the rising tide of fascism, the time to make your exit is now.”

The entirety of the Western print and TV media—even Russia’s RT—serves as a propaganda ministry for Washington against Assange. For example, we read over and over that Assange is hiding out in the London Ecuadoran Embassy to avoid rape charges in Sweden. That the presstitutes and the feminists can keep this bogus claim alive despite all the official repudiation of it shows the Matrix in which Western peoples are corralled.

Assange has never been charged with rape. The two Swedish women who seduced him and brought him into their beds in their homes never said he raped them. Assange’s tribulations began when one of the women who seduced him worried that he did not use a condom and that he might have HIV or Aids. She asked Assange to take a test to see if he was sex disease free, and Assange, offended, refused. This was his mistake. He should have said, “of course, I understand your concern” and taken the test.

The woman went to the police to see if Assange could be forced to take the test. It was the police who turned this into a rape investigation. Charges were brought, and the Swedish prosecutorial office investigated and dropped all charges as the sex was consensual.

Assange left Sweden legally, not in flight as the story that Washington has planted has it. He went to England, another mistake as England is Washington’s playground. Washington and/or lesbian feminists lusting for the conviction of a heterosexual male convinced a female Swedish prosecutor to reopen the closed case.

In an unprecedented act, the Swedish prosecutor issued an order to the UK for Assange to be handed over for questioning. Extradition orders are only valid for filed charges, and there were no filed charges, only dismissed charges. Never before had even the corrupt UK government granted an extradition order for questioning. The UK government, Washington’s puppet, agreed to hand over Assange to Sweden. It was completely clear as there was no case in Sweden against Assange that the Swedish prosecutor, probably for a large sum, would turn Assange over to Washington, a place in which no legal protections exist for anyone, not even for those, such as whistleblowers, who are protected by US law, but, despite the protection of law, nevertheless go to prison.

Seeing what was coming, Assange was granted political asylum by President Correa and escaped house detention in the UK to make it to the Ecuadoran Embassy in London, where he has been ever since, despite the Swedish government’s dropping of all charges against Assange and again closing the investigation.

In the meantime a US attorney, corrupt as they all are – never believe any federal indictment as they are created out of whole cloth without any need of evidence – managed to convince an incompetent American grand jury to indict Assange for what we do not yet know, but most likely for espionage.

The US grand jury that approved the secret indictment has no comprehension that they indicted a person for telling the truth precisely as protected – and required if government is to be controlled by the people—by the US Constitution. All Assange did was to publish documents sent to Wikileaks by a person with a moral conscience who was disturbed at the blatant criminality and inhumanity of the US government.

There is no legal difference whatsoever between Wikileaks publishing the documents leaked to Wikileaks, and the New York Times publishing the Pentagon Papers leaked to the New York Times.

The difference is the difference in time. When Daniel Ellsberg leaked the Pentagon Papers to the New York Times, the media had not been concentrated into a few hands by the corrupt Clinton regime, and 9/11, which was used by Dick Cheney to criminalize truth-telling, had not occurred. Therefore in the 1970s it was still possible that some important part of the media might tell the truth. Nevertheless, the only reason that the NYTimes published the Pentagon Papers is that the newspaper hated Richard Nixon, who the Democratic media blamed for the Vietnam War even though it was Democratic President Johnson’s war and Nixon wanted to end it.

When the insouciant American and Western peoples accept their governments’ lies, they accept their own demise and servitude. The willingness and abandon with which the Western peoples submit makes one conclude that they prefer servitude. They don’t want to be free, because freedom has too many responsibilities, and they don’t want the responsibilities. They want go watch a movie, or a TV program, or play video games, or have sex, go shopping, get drunk, have a drug high, or whatever form of amusement that they value far more than they value liberty, or truth, or justice.

To a person of my disappearing generation, it is inexplicable that the nations of the world, much less Americans, would stand moot while the world’s best, most trusted and most honest journalist is set up by a totally corrupt US government for destruction. The result of Assange’s persecution will be to criminalize embarrassing the US government.

When I contemplate this massive injustice to which the peoples of the world reply with silence, I wonder if those trying to save Western Civilization are not misguided. What is the point of saving a totally corrupt civilization?

Those who attack Assange are despicable. If you have a chance to push one or more of those who are members of the lynch mob in front of a truck, think of the act as a cleansing opportunity.

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