Massive Fires Erupt After Drone Strike Hits World’s Largest Oil Processing Facility In Saudi Arabia
What appears to be the most devastating Yemen Houthi rebel attack on Saudi Arabia to date, took place overnight on the world’s largest oil processing facility as stunning videos emerged of massive explosions rocking the major Aramco Buqyaq facility.
Fires burned into the morning daylight hours, with explosions also reported at the Khurais oil field, in what the Houthis said was a successful attackinvolving ten drones. “These attacks are our right, and we warn the Saudis that our targets will keep expanding,” a rebel military spokesman said on Houthi-operated Al Masirah TV.
Satellite images shows extent of fires following the attacks in eastern Saudi Arabia: NASA Worldview/AP
Saudi authorities — initially slow or reluctant to identify the cause of the major blaze — on Saturday issued a confirmation via the Saudi Press Agency: “At 4.00am (01:00 GMT) the industrial security teams of Aramco started dealing with fires at two of its facilities in Abqaiq and Khurais as a result of… drones,” an interior ministry statement said, which further claimed the fires were “under control”.
However, the Saudis have stopped short of acknowledging the Houthis were behind the attack, which Riyadh is also likely to blame on Iran, which has lately promised that if it can’t export its oil then “no one will”.
It remains unclear according to early statements whether there were injuries or casualties in the twin oil facility attacks.
The impact on global oil markets – closed for the weekend – could be significant given the Khurais field produces about 1% of all the world’s oil (estimated at over 1M bpd and reserves of over 20BN bpd) and more importantly Abqaiq, which based on the stunning local footage bore the brunt of the drone attacks, remains the most crucial of the kingdom’s processing plant.
Located 37 miles southwest of Aramco’s Dhahran headquarters, it controls all the flows from fields like the giant Ghawar field to coastal export terminals like Ras Tanura. Saudi Aramco describes the Buqyaq facility as “the largest crude oil stabilization plant in the world.”
According to breaking reports the devastating drone attacks could impact up to 5 million bpd of oil production.
European carmakers are facing what could turn out to be a major crisis cooked up by EU regulators, and it’s all about EVs and emissions. The former are supposed to help solve the problem with the latter, but the likelihood of success is uncertain because there are literally millions of variables: car buyers.
The EU has been enforcing emission caps on cars since 2012. Until this year, this cap has been an average of 130 grams of CO2 per kilometer for all new passenger cars. Beginning next year, however, this would be reduced further to 95 grams of CO per km. In fuel consumption, the 130 g/km cap corresponds to an average 5.6 liters of gasoline per 100 km while the 95 g/km cap corresponds to 4.1 liters per 100 km.
Europe’s big carmakers are lining up the EVs. Volkswagen alone is planning four new EV models for 2020, after earlier this month it unveiled its first mass production affordable EV, the ID3. More models should be coming from the top carmaker in the next few years and its rivals will not be sitting idly by. Everyone who makes cars in Europe has an electric lineup… but there are no guarantees that people will want to buy those cars.
“You have cars that cost an extra 10,000 euros to build, fleet-emissions targets requiring a certain sales volume and consumers who may or may not want them,” one executive from PSA Group (the company that makes Citroen and Peugeot) told Reuters at this week’s Frankfurt Motor Show.
It’s not like the industry hasn’t tried to make EVs attractive. It’s enough, at least in some parts of the EU, to say they are the greener alternative, and there will be people to buy them. Unfortunately, the majority seems to like big cars over green cars.
A report by Automotive News Europe revealed in March this year that while total car sales in 2018 had stayed flat on 2017, sales of SUVs and crossovers in the EU had posted a healthy growth of 18 percent. That’s 800,000 more SUVs and crossovers sold in the EU last year, with the total reaching 5.3 million.
Greenpeace had more bad news for Europe’s carmakers. In a report titled Crashing the Climate: How the Car Industry is Driving the Climate Crisis, the environmental organization said the total carbon emissions of what Greenpeace calls “the dirty dozen” carmakers had exceeded the EU’s carbon emissions in 2018. Fun fact: Volkswagen was the worst offender, probably because it sells the most cars.
Greenpeace went on to add that sales of SUVs in Europe had risen more than four times since 2008, with their market share reaching 32 percent, from just 8 percent in 2008. Sure enough, in recent years, some of these SUVs are hybrid, but the great majority are not.
According to a German engineering consultancy cited by Reuters, based on the EU’s emission targets, sales of EVs would need to increase three times to reach a 6-percent market share by 2021, in order to make a difference. Hybrid vehicle sales, FEV Consulting says, would need to accumulate a 5-percent market share.
That’s quite a rise in EV sales in countries that are not as small and green as Norway. Given the buying trends from recent years, carmakers have every reason to worry about their EV plans not working out. Unfortunately, there is little they can do to tame the wild cards that are SUV-loving customers.
Ukraine President Thanks Trump Admin For Releasing Hold On $250M In Military Aid
Ukrainian President Volodymyr Zelensky thanked the Trump administration for releasing $250 million in military aid which was delayed last month over concerns that the money was not being spent in the best interests of the United States.
Ukrainian President Volodymyr Zelensky
“The president has made no secret when it comes to foreign assistance that U.S. interests abroad should be prioritized and other foreign countries should also be paying their fair share,” a senior administration official told reporters in August.
The move came after US lawmakers on both sides of the aisle pressured the White House – capped off by the threat of an amendement to the $695 billion Pentagon funding lodged by Senate Minority Whip Dick Durbin (D-IL), which would have prevented Trump from withholding such funds in the future, according to Fox News.
Several Republican senators, including Trump ally Lindsey Graham, said they would have voted with the Democrats on the amendment.
“We support Ukraine. Period. End of discussion,” said Sen. John Kennedy, R-La.
Congress initially approved the aid last month, but Trump asked his national security team to review funding for the program, the Ukraine Security Assistance Initiative, to ensure it would be used in the best interests of the United States. –Fox News
Speaking at the Yalta European Strategy annual meeting organized by the Victor Pinchuk Foundation, Zelensky also announced an additional $140 million which accompanied the release, telling the audience “I like this kind of relationship,” calling it a “very good economic model.”
On Thursday, Senate Majority Leader Mitch McConnell (R-KY) said of the decision “It would have been a mistake to hold back our assistance to the brave people of Ukraine. Doing so would have undermined our partners in Ukraine and Eastern Europe and further emboldened the Kremlin,” adding “I criticized President Obama for not responding more swiftly and forcefully to Vladimir Putin’s invasion of Ukraine. I joined my colleagues on both sides of the aisle in pushing that administration to provide assistance to Kyiv.“
The aid represents a substantial boost for Ukraine, whose full 2017 military budget was $5.2 billion. Separately, the State Department is giving $141 million in aid for the country’s military, according to Politico. The aid is seen by Ukraine as important to bolstering the military and keeping Russia at bay.
The administration’s hold on the aid money prompted Trump’s critics to say it was another way the president was going easy on Russian President Vladimir Putin. –Fox News
During his speech and a Q&A session with Council on Foreign Relations president Richard Haas, Zelensky vowed to reclaim Crimea from Russia.
“I’ve said it before and I’ll say it again: We must bring our territories back,” he said, adding that Ukrainian soldiers must be able to return home “as victors,” according to Newsweek.
That said, the former comedian stressed that diplomacy must be the path forward. “I have repeatedly said that diplomacy is the only way to achieve this, and its powerful and effective weapon is sanctions,” adding that sanctions are “the most important weapon.”
The president said he had come under pressure from other nations to lift sanctions on people noting the economic benefits it could have. “You lose money, sorry, we lose people,” he replied. “Unless we restore peace, the sanctions should stay,” he continued.
Nonetheless, the president—whose new party swept a snap parliamentary election in July to solidify his power—acknowledged how difficult it would be to regain control of Crimea, the strategically valuable peninsula annexed by Russia in 2014.
Haass suggested that Ukraine was implementing a soft power strategy over the Crimea question, seeking to present residents there with a more attractive pro-European liberal Ukrainian society to undermine the Russian nationalism favored by the Kremlin.
But Zelensky refused to be drawn on the sensitive issue, wary that his words would be twisted. Instead, he simply said his team have several ideas of how to restore Ukraine’s pre-war borders. “We will be fighting to bring the Crimea back,” he said, “and not only in words.” –Newsweek
Last week Russia and Ukraine conducted a long-expected prisoner swap, raising hopes of thawing relations between the two countries and ending the fighting which has killed some 13,000 people and wounded 30,000 more.
By ratio of 2:1, voters think it’s “fundamentally undemocratic” for some MPs to try and prevent Brexit
A new survey conducted by research experts ComRes, finds that the majority of British people want the Brexit vote to be respected and want the country to leave the EU without any more delays.
Despite calls for delaying and even canceling Brexit from both members of the Labour Party and the entirety of the Liberal Democrat party, the survey finds that a majority of British people categorically do not want that to happen.
More than half of British adults, 54 percent, believe the result of the 2016 referendum should be respected, and Brexit delivered, the poll found.
Only 25 percent disagreed, and 21 percent said they didn’t know.
New @ComRes poll for @Telegraph out tonight: 54% support Boris Brexit pledge, including 35% of 2016 Remainers who say the #EURef result ‘should be respected’
Even among those who voted Remain in 2016, more than a third, 35 per cent, said they now wanted Brexit delivered.
“Irrespective of whether or not I voted to leave, the 2016 Ref result shd be respected” agree 54% incl 35% of 2016 Remain voters, 27% of Lib Dems, 33% of Lab voters @ComRes for @Telegraph
The survey noted that By ratio of 2:1, voters think it’s ‘fundamentally undemocratic’ for some MPs to try and prevent Brexit.
By ratio of 2:1, voters think it’s ‘fundamentally undemocratic’ for some MPs to try and prevent Brexit given that Govt promised before #EURef to implement the result’ (50% to 26%, 24% DK), incl 29% of Remain voters @ComRes for @Telegraph
If Brexit were to be revoked, it is clear from these figures that there would be a massive uprising.
The argument that the 2016 EURef result shd be respected gets almost universal support among BXP voters (97%), plus massive support from Leavers (87%) and Con voters (85%) @ComRes for @Telegraph. Pretty clear that these folk wouldn’t take revoking A50 very well…
The poll also found that 40 percent disagree with Labour leader Jeremy Corbyn’s opposition to Prime Minister Boris Johnson’s call for a general election.
Thirty percent said they do not want an election, with the remaining 30 percent saying they do not know.
The poll also found that almost half of British voters would rather leave the EU with No Deal than have Corbyn as Prime Minister. Only 22 percent thought this was a good idea.
Fascinating Brexit & Corbyn figs from @ComRes for @Telegraph tonight – getting for half (43%) of 2016 Remain voters wd prefer to leave the EU w/a deal than have Corbyn as PM (1/3)
“If the Government cannot get a Withdrawal Agreement through Parliament, they should leave the EU without a Withdrawal Agreement (i.e. without a deal)”
“I am fearful of no-deal consequences for me & my family” agree 46% disagree 33% DK 21%
Remainers – 75% agree
Leavers – 18% agree @ComRes for @Telegraph
Massive party divide over Corbyn’s blocking of Boris’s request for a GE – 79% of Tory voters and 88% of BXP voters support blocking it, compared to 11% of Lab and 21% of LD voters @ComRes for @Telegraph
“If EU refuses any more concessions, UK shd leave w/no deal on 31/10” agree 43% (79% among Tories, 93% among BXP voters) disagree 32% (8% Tories) @ComRes for @Telegraph
This is installment five in a series of posts about a new paper, The Mischief Rule. One question many readers have is whether the mischief rule is just purposivism. Indeed, Scalia and Garner define the mischief rule as a British term for purposivism, but that is incorrect, both historically and analytically. Here I’ll give a few paragraphs on this question from the introduction. But if you want more, there’s a subpart of the paper on the distinction between the mischief rule and purposivism, and there’s also a subpart on Scalia and the mischief rule (especially in the way he reads Oncale in his “Reading Law” book). As the paper shows in more detail, textualists can use the mischief rule with a good conscience. And textualists should, because the mischief can provide context and occasion for understanding the legislative decision embodied in the text (i.e., as pragmatics, and as suggesting a tacit domain quantifier–the “no beer in the fridge” example from the footnotes).
At any rate, here is a preliminary account of the differences:
Yet the mischief rule has largely dropped out of the discourse of American legal scholarship—why? The most likely answer is simply that the rule is thought to be equivalent to purposivism. But consider a simple theory of action, which is not meant to be philosophically robust but rather to illustrate the distinction between mischief and purpose. There are certain things that spur us to consider acting. Spurred on, we act. But we do so not like a coracle, buffeted by the waves, rudderless and unpaddled. Instead we have reasons for our actions. But the expression “such and such was my reason for acting” is ambiguous. It could refer to the initial cause, the spur to acting. Or it could refer to the aim (or ultimate aim) that I had for acting. Both are, in a sense, my “reason.” Yet they can be assigned different locations in this sentence: “Because of a, the action b, so that c.” That ambiguity in my “reason” is precisely why the difference between mischief and purpose is usually obscured. The mischief is the spur, the “because of.” More technically, for law, the mischief is the problem that precedes the statute and the legal deficiency that allowed it; the mischief is what the statute responds to. The purpose imputed to the legislature is an aim going forward.
There will be instances of convergence between the mischief and the purpose, instances in which the purpose is no more than the removal of the mischief (“because of a, the statute b, so that not a“). Yet there will often be more than that mere convergence; the imputable purpose will often be an extrapolation from the evil to something more abstract. Hart and Sacks are themselves quite clear on this point. They add a crucial step: the interpreter starts with the mischief and then from it infers “the general purpose.” That step is significant. It makes the mischief grist for the mill of purpose. That additional level of abstraction is indeed valuable if a judge sees her role as faithfully interpreting a statute in a way that fulfills the legislature’s policy aims (a standard purposivist conception). But it would be an error if a judge sees her role as faithfully interpreting a statute so as to carry out the policy embodied in the statute itself (a standard textualist conception).
Because this Article attempts to give the mischief rule a discrete existence, it is of course true that I am sharpening the contrasts between the mischief and an array of adjacent and overlapping concepts, including purpose, the equity of the statute, and so on. What is at issue is not mere legal taxonomy, but rather a critical question about the role of context in legal interpretation. Statutory interpreters of all stripes say that context is important, but textualists, especially, will sometimes in practice limit the relevant context to laws (i.e., other provisions of the same statute, other statutes, and background principles of law). This Article argues for a broader understanding of context that includes the setting of the legal enactments, one aspect of which is the mischief.
Finally, even though I’m not usually including footnotes in this series of blog posts, here is one:
Put differently, it is true not only that statutory language is context-sensitive (i.e., dependent for its meaning on pragmatics as well as semantics, see Bach, supra note 6), but also that it is sometimes context-sensitive in a very specific way: to understand the words, the interpreter needs to understand the mischief.
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This is installment five in a series of posts about a new paper, The Mischief Rule. One question many readers have is whether the mischief rule is just purposivism. Indeed, Scalia and Garner define the mischief rule as a British term for purposivism, but that is incorrect, both historically and analytically. Here I’ll give a few paragraphs on this question from the introduction. But if you want more, there’s a subpart of the paper on the distinction between the mischief rule and purposivism, and there’s also a subpart on Scalia and the mischief rule (especially in the way he reads Oncale in his “Reading Law” book). As the paper shows in more detail, textualists can use the mischief rule with a good conscience. And textualists should, because the mischief can provide context and occasion for understanding the legislative decision embodied in the text (i.e., as pragmatics, and as suggesting a tacit domain quantifier–the “no beer in the fridge” example from the footnotes).
At any rate, here is a preliminary account of the differences:
Yet the mischief rule has largely dropped out of the discourse of American legal scholarship—why? The most likely answer is simply that the rule is thought to be equivalent to purposivism. But consider a simple theory of action, which is not meant to be philosophically robust but rather to illustrate the distinction between mischief and purpose. There are certain things that spur us to consider acting. Spurred on, we act. But we do so not like a coracle, buffeted by the waves, rudderless and unpaddled. Instead we have reasons for our actions. But the expression “such and such was my reason for acting” is ambiguous. It could refer to the initial cause, the spur to acting. Or it could refer to the aim (or ultimate aim) that I had for acting. Both are, in a sense, my “reason.” Yet they can be assigned different locations in this sentence: “Because of a, the action b, so that c.” That ambiguity in my “reason” is precisely why the difference between mischief and purpose is usually obscured. The mischief is the spur, the “because of.” More technically, for law, the mischief is the problem that precedes the statute and the legal deficiency that allowed it; the mischief is what the statute responds to. The purpose imputed to the legislature is an aim going forward.
There will be instances of convergence between the mischief and the purpose, instances in which the purpose is no more than the removal of the mischief (“because of a, the statute b, so that not a“). Yet there will often be more than that mere convergence; the imputable purpose will often be an extrapolation from the evil to something more abstract. Hart and Sacks are themselves quite clear on this point. They add a crucial step: the interpreter starts with the mischief and then from it infers “the general purpose.” That step is significant. It makes the mischief grist for the mill of purpose. That additional level of abstraction is indeed valuable if a judge sees her role as faithfully interpreting a statute in a way that fulfills the legislature’s policy aims (a standard purposivist conception). But it would be an error if a judge sees her role as faithfully interpreting a statute so as to carry out the policy embodied in the statute itself (a standard textualist conception).
Because this Article attempts to give the mischief rule a discrete existence, it is of course true that I am sharpening the contrasts between the mischief and an array of adjacent and overlapping concepts, including purpose, the equity of the statute, and so on. What is at issue is not mere legal taxonomy, but rather a critical question about the role of context in legal interpretation. Statutory interpreters of all stripes say that context is important, but textualists, especially, will sometimes in practice limit the relevant context to laws (i.e., other provisions of the same statute, other statutes, and background principles of law). This Article argues for a broader understanding of context that includes the setting of the legal enactments, one aspect of which is the mischief.
Finally, even though I’m not usually including footnotes in this series of blog posts, here is one:
Put differently, it is true not only that statutory language is context-sensitive (i.e., dependent for its meaning on pragmatics as well as semantics, see Bach, supra note 6), but also that it is sometimes context-sensitive in a very specific way: to understand the words, the interpreter needs to understand the mischief.
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IMF Estimates $15 Trillion Of World’s Foreign Direct Investments Are “Phantom Capital”
A new study published by the International Monetary Fund has found that $15 trillion of the world’s foreign direct investments are “phantom capital” – a term used to describe capital that is designed to minimize tax bills of multinational firms.
This total makes up 40% of the world’s foreign direct investments, and is the equivalent to the combined GDP of China and Germany, according to Bloomberg.
These types of investments have risen about 10% over the past decade despite global efforts to curb tax avoidance, according to the IMF study. The capital makes its way through corporate shells that generally have no operations or real business activity.
The study stated:
“FDI (foreign direct investment) is often an important driver for genuine international economic integration, stimulating growth and job creation and boosting productivity. But phantom capital is financial and tax engineering that blurs traditional FDI statistics and makes it difficult to understand genuine economic integration.”
It continued:
“Luxembourg, a country of 600,000 people, hosts as much FDI as the U.S. and much more than China. FDI of this size hardly reflects brick-and-mortar investments in the minuscule Luxembourg economy, whose $4 trillion in FDI comes to $6.6 million a person. Unsurprisingly, an economy’s exposure to phantom FDI increases with the corporate tax rate.”
About half of the world’s “phantom capital” is hosted by Luxembourg and the Netherlands, with just 10 economies globally holding more than 85% of such investments.
The study concluded that “international cooperation” was vital to solving the issue: “Indeed, this year the IMF put forward various alternatives for a revised international tax architecture, ranging from minimum taxes to allocation of taxing rights to destination economies. No matter which road policymakers choose, one fact remains clear: international cooperation is the key to dealing with taxation in today’s globalized economic environment.”
One of the best things about the otherwise tedious Super Bowl broadcast earlier this year was the debut of a mildly amusing, medieval-themed Bud Light beer commercial that attacked rivals Miller Lite and Coors Light over the latter two’s use of corn syrup as an ingredient in their respective brewing processes.
“Bud Light,” one such ad closes. “Brewed with no corn syrup.”
That is, by all accounts, a true statement. But it’s also one that helped spur MillerCoors, which brews (as its name implies) Miller Lite and Coors Light, to file a federal lawsuit in Wisconsin against Bud Light brewer Anheuser-Busch.
The Bud Light ad, court documents state, “claims that Miller Lite and Coors Light are ‘made with’ or ‘brewed with’ corn syrup.” All parties to the lawsuit agree that MillerCoors uses corn syrup as an ingredient in brewing both Miller Lite and Coors Light.
The crux of MillerCoors’s claims against Anheuser-Busch, then, is that “when viewed as a whole, [the advertisements] deceive[] consumers into believing that Miller Lite and Coors Light final products actually contain corn syrup and thus are unhealthy and inferior to Bud Light.”
Corn syrup, a glucose-based sugar, has become a much-derided food ingredient. That’s due to the fact it’s a type of sugar but, more so, to its relation to high fructose corn syrup (also known as HFCS, a sweeter mix of glucose and fructose). Indeed, MillerCoors claims Bud Light is using the relationship to “exploit or further misconceptions about corn syrup and high fructose corn syrup.”
The MillerCoors complaint also claims in part that Bud Light “fails to inform consumers” that Miller Lite and Coors Light don’t brew beer with HFCS and that when consumers buy Miller Lite or Coors Light, the products they buy contain no corn syrup.
The MillerCoors complaint centers on a deceptive-advertising claim under the federal Lanham Act. The basic premise underlying the Lanham Act’s application here is that if a company’s communications (advertising, marketing, packaging, and the like) intentionally mislead the public in such a way that harms that company’s competitor(s), then the competitor(s) may seek redress under the law.
MillerCoors has asked the court to issue an injunction and award monetary damages.
In May, U.S. District Court Judge William M. Conley granted some of what MillerCoors has sought. He issued a preliminary injunction that barred Budweiser from implying in its advertising that Miller Lite—as sold to consumers—contains corn syrup.
Now, in a brief order issued last week, Judge Conley has upped the ante, extending his injunction to Bud Light’s packaging, which has included the words “no corn syrup” printed on packaging and store displays.
“With this ruling, we are holding Bud Light accountable for their actions, and we will keep holding their feet to the fire every time they intentionally mislead the American public,” MillerCoors CEO Gavin Hattersley said in a statement that was reported by TheNew York Times last week.
Anheuser-Busch, hardly cowed, immediately appealed the ruling and debuted two new ads.
“MillerCoors[] has publicly acknowledged that Miller Lite and Coors Light are both brewed with corn syrup,” a company spokesperson said in the wake of the ruling. “We publicly acknowledge that Bud Light is brewed with no corn syrup. These are simply the facts on which everyone agrees. Not only are we appealing this decision, we will continue providing consumers with the transparency they demand, including by informing beer drinkers that Bud Light is brewed with no corn syrup.”
University of Pennsylvania Professor Yoram Wind, an expert hired by MillerCoors to study the impact of the Bud Light advertisements on consumers, noted that most of his study participants who saw an ad believed both that Miller Lite and Coors Light use corn syrup in the brewing process and that there is“corn syrup in the Miller Lite and Coors Light you drink.“
Did Bud Light intentionally mislead consumers by making truthful statements? The court has said the strongest argument made by MillerCoors is that the record shows Anheuser-Busch “was both aware of and intended to exploit consumer concerns about corn syrup (and high fructose corn syrup in particular).“
Any such confusion appears to have been stoked thanks to comments made by senior Anheuser-Busch staffers. Andy Goeler, head of marketing for Bud Light, said in discussing the ad campaign that “consumers generally don’t differentiate between high fructose corn syrup and corn syrup, and that it is a major triggering point in choosing brands to purchase.” Another senior Anheuser-Busch official, the lawsuit states, said beer drinkers don’t want to “put[] something like corn syrup, if they had a choice, into their body.”
Those comments are undoubtedly disingenuous, a defect the Bud Light ad itself also suffers from. After all, other beers, ciders, and beverages produced by Anheuser-Busch do, in fact, contain corn syrup.
There’s little doubt Bud Light is capitalizing on consumers’ growing aversion to HFCS. But is that against the law? Why shouldn’t Bud Light use truthful statements to mock its competitors if it so chooses? Sure, the cans of Miller Lite and Coors Light your dad buys contain neither HFCS nor corn syrup. But they’re both brewed with the latter. That is factually true. Was the Lanham Act really intended to prohibit literally true statements, to punish those companies that make such statements, and to protect companies that feel victimized by the truth? I think not.
That’s why this case borders on the preposterous. If anything, MillerCoors should direct its ire (if not its attorneys) at the senior Anheuser-Busch employees who may or may not have disparaged Miller Lite and Coors Light. Better still, MillerCoors should take its fight with Bud Light to the court of public opinion. Instead of complaining about Bud Light’s ads, MillerCoors should respond with a campaign of its own. Hopefully, they’ll see the lite.
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Trump and Johnson face a common enemy in their complacent and costly establishments, but it is wrong to think they share a common approach to government business and finances. For the moment, all attention in Britain is focused on Brexit, but under Johnson’s predecessors, spending has become increasingly driven by process instead of outcomes. Johnson’s chief strategist has identified the reversal of this trend as offering the key to delivering outcomes in a post-Brexit UK while balancing the budget and reducing tax.
Introduction
Superficially, the electorates of America and Britain share one thing in common. They have both become sick of the establishment’s arrogant presumption that it knows better than the common people. Donald Trump spotted it and won the presidency in the face of enormous hostility from the establishment, both Democrat and Republican, as well as the deep state comprised of unaccountable intelligence operators and bureaucrats. The year before, the Westminster establishment found ordinary people rebelled against its assumed right to run the affairs of the electorate.
In Britain, if a mistake was made, it was to offer a referendum which produced the wrong answer. That is how the establishment appears to see it. In America, the UK as well as in Europe an elite has emerged for which democracy has become an irritant. But the establishment knows the rules and cannot deny their validity. The electorates in America and Britain have now given their establishments an unpalatable message, that they overrated their own importance. The bureaucrats no longer represent the interests of the people. Quite simply, the establishment and its bureaucrats have broken their contract with their electors, drifting away from the primary reason for their existence. The ordinary person has had enough of being ignored.
The result is the establishment is being forced to fight for its survival. President Trump has been fighting this battle on behalf of the American people for nearly two years. The British establishment has been fighting a rear-guard action for three over Brexit. Neither establishment has yet been vanquished. In America, there are signs of an accommodation, a compromise, which will allow the state to gradually resume control. In the UK, the survival of Boris Johnson and his new government depends on his refusal to compromise in its fight against the establishment’s Europhiles and placemen.
Brexit is a conflict that is only now being forced to a conclusion after three years of a Remainer government trying to appear to comply with the referendum result, while locking the United Kingdom into the EU, potentially in perpetuity. The electorate rumbled it and threatened the ruling Conservative party with extinction. Recognising the danger, their parliamentary party in conjunction with the party membership ejected the complicit Theresa May and elected Boris Johnson to take the country out of the EU on the delayed date of 31 October.
It is by no means certain Johnson will succeed. Remainers are now fighting his government in the courts, with the Supreme Court due to adjudicate next Tuesday (17 September) on whether the prorogation of Parliament was legal. And a way has to be found around the Benn-Burt Law, the last act of Remainer MPs.
The behaviour of the opposition parties in Parliament has been unedifying. The public sees a parliament out of control under a partisan Speaker. Not surprisingly, the opinion polls are swinging more in support of Johnson’s Conservatives and against the other parties, widening the gulf even further between Parliament and the people its members are elected to serve. If Parliament had any public respect before recent events, then it has certainly lost it now.
The similarities between President Trump’s position fighting the Federal establishment and that of Boris Johnson fighting Westminster gives the impression to many international observers that Boris is a British version of The Donald. Trump is urging the British to leave the EU, and thinks Johnson is the man to do it. Johnson is happy to encourage Trump’s support for a quick, post-Brexit trade deal. They get on together well.
But they are not peas in the same pod. Johnson has shown a free-marketeer grasp over trade issues and the damage that tariffs can do, while Trump is an interventionist. And when it comes to deficit financing, the evidence is emerging that Boris will fund promised spending in education, policing and health by cutting bureaucracy rather than relying on deficit stimulation now to provide tax income tomorrow. This is where Dominic Cummings comes into play.
This article skims over recent developments in Britain’s fight to free itself from the EU, particularly with respect to the role of Cummings. Making a huge assumption that Johnson and Cummings manage to implement Brexit on 31 October and the Conservatives are re-elected in a general election shortly, it also looks at how the government is likely to fund its promised expenditure plans.
Cummings – the confident back-room operator
Dominic Cummings scares much of the Westminster establishment, with good reason: he is intent on destroying it in its current form and replacing it with a system that prioritises objectives, minimising non-essential political and administrative intervention. There will be no tolerance of virtue-signalling by ministers and pressure groups. Of the money allocated to a project, instead of a Pareto eighty per cent being spent on process and twenty per cent on the final objective, Cummings is bent on ensuring it is the other way around, even releasing funds to permit tax cuts while retaining a balanced budget.
But first Cummings is dedicated to achieving Brexit on 31 October, when he will have directed the strategy to remove Britain from under the stultifying regulations and bureaucracy emanating from EU membership, freeing him to pursue his ultimate objective. On Brexit, we can only watch developments, because outsiders can only guess the government’s next moves and the final outcome.
To understand more fully Cummings’s role as special advisor to Boris Johnson, his ambitions, intentions and prospects for success, it is worth delving into his personal story. He was born in Durham in North-East England to middle-class parents in 1971. He attended Durham School, a middle-of-the-road fee-paying school, and then attended Exeter College at Oxford University, graduating with a First in Ancient and Modern History.
Robin Lane Fox, his tutor in Ancient History described him in a recent BBC profile as “extremely aware of his own abilities and had every reason to be”. When asked who was cleverer, Boris Johnson or Dominic Cummings, Lane Fox responded “Dominic is cleverer by a long way than Boris. Different class altogether”.
Lane Fox would also have known Johnson, who attended Oxford at Balliol, where he entered as a Brackenbury Scholar to read Literae Humaniores, a four-year course in Ancient Greek and Latin Classics. But Johnson, who as a student appears to have lacked Cummings’s focus, only got a 2:1. However, his intellect should not be in doubt, and while one can understand Lane Fox underestimating Johnson due to his lack of intellectual focus, Cummings appears to have been exceptional.
His other tutor in Modern History was Norman Stone, who died in June. Stone was also a notable intellect, and in his day had been an advisor to Margaret Thatcher. Both Stone and Thatcher shared a distrust of the British and European establishments. Stone’s was based on his deep knowledge of European history, honed from his studies at Glasgow University. Smith’s association with Glasgow University would have also had a bearing on Stone’s free-market thinking. Adam Smith, the founder of economics as a human science, had been appointed as its Professor of Logic, and the following year he was appointed Professor of Moral Philosophy.
Stone was a man who would cut to the quick and did not suffer mediocracy, let alone fools. He was a chain-smoking hard-drinking argumentative Glaswegian who would not have endeared himself to “the humourless halfwits who are the bedrock of university management and the political class”. As an example of his impiety and wit he came up with one of the best questions ever set in a Cambridge tripos: “Romanticism: masculine, feminine or neuter?”
In his own way, Stone wanted to help Mrs Thatcher undermine the rotten British political system, which by 1979 had drifted onto the rocks of socialism. The Thatcher revolution saved Britain by driving Marxist Labour into the wilderness, much as the Johnson/Cummings partnership seeks to today.
After Thatcher’s initial success against socialism, the establishment reconstituted itself on proto-capitalist lines and ejected her in 1990. Despite Stone’s brilliance, his influence and role as Thatcher’s foreign policy advisor on Europe and speech writer was sadly limited in the light of events. Stone would have found that with all its mediocracy, the establishment always regroups. But perhaps a more sober, focused and ruthless operator in his protégé might have a better chance. It appears that Stone quickly recognised Cummings’s intellect, and would have been attracted by his directness and sense of purpose. They were like-minded dissident geniuses.
Cummings learned about Thucydides from Fox Lane, and Bismarck from Stone. I see a parallel with TE Lawrence, another young man a century ago who was a loner, aloof from his contemporaries but with a remarkable intellect. In Lawrence’s case, he single-mindedly inspired Bedouin tribesmen to revolt against the Turks in Palestine, leading to the creation of nation states in the Middle East. As well as having Lawrence’s detached ability to analyse and lead, Cummings appears to possess Lawrence’s brilliant singlemindedness. He clearly identifies an objective and is ruthless in his focus and determination to achieve it, just as was Lawrence.
Cummings’ first serious role in government was as special advisor to Michael Gove, at that time David Cameron’s education secretary. He helped Gove push through many major reforms, and his view on the importance of the state getting education right and the means of achieving it is the subject of his 235-page essay, Some thoughts on education and political priorities. His ambition then and now is for Britain to become the school of the world, echoing Pericles’ description of Athens as the school of Greece.
In his essay, Cummings describes those in English politics and power as lacking structured and disciplined thought, being much more interested in appearing to be on the side of the poor and less able, than they are in raising standards. Policy debates had become little more than exercises in moral exhibitionism.
Crucially, from his essay he is convinced that enormous savings can be made in the administration of state education, enough to fund the achievement of end-objectives and still have money left over to spend elsewhere or to reduce spending overall. He also observes that savings from his focused approach can be made across all Whitehall departments. It is clear from his essay that he intends to release the funds for the new Johnson government’s proposed spending on education, policing and health by cutting spending on bureaucratic and political processes not essential to end objectives.
This has been attempted before. All attempts, and there have been many over the years, to have a bonfire of the quangos have failed. [Quango is an acronym which stands for quasi-autonomous non-government organisation, an arms-length entity set up by a government department, which usually add little value and much bureaucracy. It is estimated there are 742 quangos spending some £100bn annually, though estimates vary considerably].
Cummings’ approach to eliminating this waste appears to be different from previous attempts. He is the lead special adviser in a network of nearly a hundred “spads” (as at end-2018). He is moulding them into a combined force, separate from both government and the civil service, responsible directly to him as well as their relevant ministers. This ensures that ministers will be advised in accordance with Cummings’ policy of cutting waste and increasing the effectiveness of decision making by focusing on objectives, and not process.
In effect, the continuing advice given to ministers by their departmental civil servants will be made to conform with the Cummings policy. It is no less than a carefully planned attempt to wrest control from a floundering political establishment to make government more efficient and objective in its aims. However, the initial task is to deliver Brexit on 31 October, and we are already seeing the consequences of the Cummings approach.
Cummings does not compromise in pursuing his objectives. He has ensured the removal of the whip from plotting Remainers in the Conservative parliamentary party in brutal, public fashion. Any special adviser not totally onside is treated equally brutally, one in the Treasury suspected of leaking having been sacked by him on the spot and marched out of Downing Street by an armed policeman. Whitehall has not in living memory seen this level of hard-headedness, focus and determination. And he is Boris Johnson’s real chef de cabinet.
The relationship with Boris was forged when they worked together on the Brexit referendum campaign where Boris was the front man and Cummings the operator. It suited Boris, who is an excellent delegator and was happy for Cummings to run the show on his and his political colleagues’ behalf. It is a relationship that continues to endure between two like-minded classicists. Boris’s other appointments, particularly in Gove, Javid, Rees-Moog and Raab, amount to an intellectually capable cabinet espousing free market economics. By restoring Cabinet discipline, Johnson has ensured ministers will be in tune with Cummings’s plans to reduce government’s operating costs to the lowest possible level. But their first task, to deliver Brexit, is still in play. With Cummings and Boris working on a plan towards a clear objective, they are likely to succeed against the Remainers, who beyond being disruptive, are incapable of coming up with any feasible strategy. But for the moment, we do not know how this will play out and can only speculate.
Britain’s future under a reforming government
Without a majority in the Commons and an antagonistic House of Lords it may seem premature to consider how a Johnson government will change the political landscape. However, much of the current uncertainty will disappear when an uncompromising Brexit is finally achieved, and the hastily formed alliance on the opposition benches can then be expected to collapse. This assumes the government finds a way of neutralising the Benn-Burt Law, which forces it to secure the approval of MPs for either a withdrawal agreement or leaving without a withdrawal agreement. If at the end of 19 October neither has been achieved, the Prime Minister must then have sought an extension of the Brexit date until at least 31 January 2020. But assuming a way is found around this hurdle, the loose coalition of opposition parties will have no binding reason for its existence. Scottish Nationalists and Liberals will then relish the prospect of taking Labour seats and support a move to a general election.
Following that election and assuming Johnson achieves a working majority, all the pointless, virtue-signalling politics that ministers who served under Mrs May and their departments indulged in will be confined to the opposition benches, since Cummings and his cohort of special advisers will expunge them from ministerial decision-making. Despite the headline numbers reflecting more spent at the point of delivery in all ministries, they should be adequately funded by the elimination of needless process. At least, that’s the plan.
This is why Johnson is not on the same page as Trump, at least when it comes to the prosecution of government business, and there is a strong likelihood his Chancellor will be able to run a balanced budget (all else being equal), compared with Trump’s deliberate ramping up of unfunded spending to perpetuate the illusion of American prosperity.
One of the best things about the otherwise tedious Super Bowl broadcast earlier this year was the debut of a mildly amusing, medieval-themed Bud Light beer commercial that attacked rivals Miller Lite and Coors Light over the latter two’s use of corn syrup as an ingredient in their respective brewing processes.
“Bud Light,” one such ad closes. “Brewed with no corn syrup.”
That is, by all accounts, a true statement. But it’s also one that helped spur MillerCoors, which brews (as its name implies) Miller Lite and Coors Light, to file a federal lawsuit in Wisconsin against Bud Light brewer Anheuser-Busch.
The Bud Light ad, court documents state, “claims that Miller Lite and Coors Light are ‘made with’ or ‘brewed with’ corn syrup.” All parties to the lawsuit agree that MillerCoors uses corn syrup as an ingredient in brewing both Miller Lite and Coors Light.
The crux of MillerCoors’s claims against Anheuser-Busch, then, is that “when viewed as a whole, [the advertisements] deceive[] consumers into believing that Miller Lite and Coors Light final products actually contain corn syrup and thus are unhealthy and inferior to Bud Light.”
Corn syrup, a glucose-based sugar, has become a much-derided food ingredient. That’s due to the fact it’s a type of sugar but, more so, to its relation to high fructose corn syrup (also known as HFCS, a sweeter mix of glucose and fructose). Indeed, MillerCoors claims Bud Light is using the relationship to “exploit or further misconceptions about corn syrup and high fructose corn syrup.”
The MillerCoors complaint also claims in part that Bud Light “fails to inform consumers” that Miller Lite and Coors Light don’t brew beer with HFCS and that when consumers buy Miller Lite or Coors Light, the products they buy contain no corn syrup.
The MillerCoors complaint centers on a deceptive-advertising claim under the federal Lanham Act. The basic premise underlying the Lanham Act’s application here is that if a company’s communications (advertising, marketing, packaging, and the like) intentionally mislead the public in such a way that harms that company’s competitor(s), then the competitor(s) may seek redress under the law.
MillerCoors has asked the court to issue an injunction and award monetary damages.
In May, U.S. District Court Judge William M. Conley granted some of what MillerCoors has sought. He issued a preliminary injunction that barred Budweiser from implying in its advertising that Miller Lite—as sold to consumers—contains corn syrup.
Now, in a brief order issued last week, Judge Conley has upped the ante, extending his injunction to Bud Light’s packaging, which has included the words “no corn syrup” printed on packaging and store displays.
“With this ruling, we are holding Bud Light accountable for their actions, and we will keep holding their feet to the fire every time they intentionally mislead the American public,” MillerCoors CEO Gavin Hattersley said in a statement that was reported by TheNew York Times last week.
Anheuser-Busch, hardly cowed, immediately appealed the ruling and debuted two new ads.
“MillerCoors[] has publicly acknowledged that Miller Lite and Coors Light are both brewed with corn syrup,” a company spokesperson said in the wake of the ruling. “We publicly acknowledge that Bud Light is brewed with no corn syrup. These are simply the facts on which everyone agrees. Not only are we appealing this decision, we will continue providing consumers with the transparency they demand, including by informing beer drinkers that Bud Light is brewed with no corn syrup.”
University of Pennsylvania Professor Yoram Wind, an expert hired by MillerCoors to study the impact of the Bud Light advertisements on consumers, noted that most of his study participants who saw an ad believed both that Miller Lite and Coors Light use corn syrup in the brewing process and that there is“corn syrup in the Miller Lite and Coors Light you drink.“
Did Bud Light intentionally mislead consumers by making truthful statements? The court has said the strongest argument made by MillerCoors is that the record shows Anheuser-Busch “was both aware of and intended to exploit consumer concerns about corn syrup (and high fructose corn syrup in particular).“
Any such confusion appears to have been stoked thanks to comments made by senior Anheuser-Busch staffers. Andy Goeler, head of marketing for Bud Light, said in discussing the ad campaign that “consumers generally don’t differentiate between high fructose corn syrup and corn syrup, and that it is a major triggering point in choosing brands to purchase.” Another senior Anheuser-Busch official, the lawsuit states, said beer drinkers don’t want to “put[] something like corn syrup, if they had a choice, into their body.”
Those comments are undoubtedly disingenuous, a defect the Bud Light ad itself also suffers from. After all, other beers, ciders, and beverages produced by Anheuser-Busch do, in fact, contain corn syrup.
There’s little doubt Bud Light is capitalizing on consumers’ growing aversion to HFCS. But is that against the law? Why shouldn’t Bud Light use truthful statements to mock its competitors if it so chooses? Sure, the cans of Miller Lite and Coors Light your dad buys contain neither HFCS nor corn syrup. But they’re both brewed with the latter. That is factually true. Was the Lanham Act really intended to prohibit literally true statements, to punish those companies that make such statements, and to protect companies that feel victimized by the truth? I think not.
That’s why this case borders on the preposterous. If anything, MillerCoors should direct its ire (if not its attorneys) at the senior Anheuser-Busch employees who may or may not have disparaged Miller Lite and Coors Light. Better still, MillerCoors should take its fight with Bud Light to the court of public opinion. Instead of complaining about Bud Light’s ads, MillerCoors should respond with a campaign of its own. Hopefully, they’ll see the lite.
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