Sargon of Akkad - Carl Benjamin - The Most Important Election in a Generation

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June 6, 2017 - Sargon of Akkad - Carl Benjamin

29:09

The Most Important Election in a Generation

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	The run-up to the general election has been very frustrating to watch because both parties have devolved into domestic minutiae or character assassination in the face of a massive economic iceberg that needs to be circumnavigated.
	The Institute of Fiscal Studies has produced what The Guardian has termed a damning assessment of both the Conservative and Labour manifestos.
	They say that neither of the two main parties has set out an honest set of choices to the public over their tax and spending plan, because neither of them are fully costed, and neither of them are taking into account the significant upset that Brexit will cause.
	They say that Labour's proposals will raise spending to its highest level since the mid-1980s and tax levels to record levels in peacetime.
	But the party's plans for tax hikes aimed at top earnest businesses may not raise anything like the 48.6 billion claimed, and its proposals could turn out to be economically damaging.
	The deputy director Carl Emerson accused Labour of pretending that everything can be paid for under plans to raise taxes on the richest, many of whom will avoid paying higher rates of tax.
	And this is where we have to introduce Labour voters to the concept of capital flight, using the example of Venezuela.
	Capital flight is the deliberate removal of wealth from a country by the people who own that wealth to protect that wealth, and it is one of the things that has contributed to Venezuela's economic collapse.
	In 2008, Venezuelan capital flight reached record levels under Hugo Chavez, and by 2016, Forbes magazine was describing Venezuela as a failed state that was bleeding cash.
	The petrodollar inflows couldn't cover the massive amount of outflows due to a collapse in exports, a rise in imports, capital flight, and external debt payments.
	After massive tax hikes, Venezuelans are fleeing the country.
	Supermarket shelves are empty, and the country cannot feed its own people.
	In January of 2017, hyperinflation hit Venezuela, rendering it a nation of broke millionaires.
	Amid rampant inflation, widespread shortages of everything from toilet paper to medicine and a failing economy, the Venezuelan government recently introduced three new banknotes into the market ranging from 500 to 20,000 bolivars.
	But while someone in Caracas can now carry 1 million bolivars in his bill fold, in terms of US currency, those 50 banknotes are only worth around $300 on the country's black market, and one bill is valued at less than $6.
	It won't get you very far, says Chris Sabatini, professor at Columbia University School of International and Public Affairs.
	It's like the government has almost given up.
	They're just adding zeros to the end of those bills, and they don't mean anything.
	Needless to say, this shortage of necessaries is getting hundreds of thousands of people in the streets to protest, riot, and loot against the president, who is effectively a dictator at this point.
	Maduro's critics say that he is to blame for the country's crippled economy, which has led to widespread protests, street looting, and rioting over the past seven weeks, leaving 47 people dead.
	With supplies of food, medicine, soap, and even toilet paper running out, protesters are demanding that early elections called to remove Mr. Maduro, who took over from Chavez in 2013 after Chavez died.
	Inflation rates are also soaring, with prices set to rise 720% this year, according to the International Monetary Fund.
	A doctor from Kent University said Venezuela is at the brink of breaking into civil war.
	There have been protests going on for months, but they are simmering and now we are reaching a breaking point.
	Those who have been protesting for 18 months tended to be from the opposition.
	Those joining now are realising that they no longer support the regime.
	In the last two weeks, the situation has deteriorated very rapidly.
	In the next week, it will continue to deteriorate very quickly unless some possible solution is found.
	This is Britain's future under Labour.
	Only I don't think it will take eight years to get to this point because we do not have Venezuela's oil reserves to coast off of.
	If you introduce massive tax increases to the rich, they will take their money and they will leave.
	I'm going to be very blunt about this.
	Socialism does not work.
	It has never worked.
	And no socialist will ever tell you that they are trying to enrich the poor.
	What they will tell you is that they are trying to impoverish the rich.
	They will, of course, dress it up in flowery language, such as saying things like making them pay their fair share.
	And, on the surface, that might sound really reasonable.
	But to the rich, this seems like an economic attack, because it is.
	And they respond by defending themselves.
	And the way they defend themselves is by leaving.
	And I'm sure I don't have to explain that if the wealthy people in your country leave, you cannot tax them to pay for the services that you want for the poor.
	Returning to the IFS assessment, they say, The shame of the two big parties' manifestos is that neither sets out an honest set of choices.
	Neither addresses the long-term challenges we face.
	For labour, we can have pretty much everything.
	Free higher education, free childcare, more spending on pay, health, and infrastructure.
	And the pretense is that all of this can be funded by faceless corporations and the rich.
	The case for higher taxes needs to be made with honesty about what it would mean for tax payments, not pretending that everything can be paid for by someone else.
	Labour's campaign slogan is For the many and not the few, which is a highly ironic campaign slogan, given the people that Jeremy Corbyn actually represents.
	On Corbyn's website, he has an article called, We Need a Strong Trade Union in Every Workplace.
	In it, he says, We win when we're in touch with the needs and the concerns of millions of working people and their families.
	The people trade unions represent.
	Which is presumably why so many trade union demands are present in the Labour Manifesto.
	The manifesto contains more than 100 policies demanded by trade unions that are bankrolling the Labour election campaign.
	Whole chunks of Labour's manifesto appear to have been copied and pasted from proposals put forward by unions.
	So given the heavy influence these unions have over labour, who exactly do they represent?
	The answer is of course, the few.
	Trade union membership is at the lowest it's been since the Second World War.
	Official figures reveal that 6.2 million employees were in unions last year, down by 275,000 on the year before, despite an overall increase in the size of the workforce.
	It was the biggest annual fall since figures began to be collected in its current form in 1975.
	More women than men were trade union members, with 3.3 million women to 2.8 million men respectively.
	Middle income workers earning between £500 and £999 a week were more likely to be members than people in jobs with higher or lower pay.
	A separate analysis of the statistics found that higher paid public sector employees were more likely to be in a union than private sector workers earning less.
	More than 60% of such public servants were in unions, compared to 10% of the lower paid in private sector roles.
	Rather than representing the working class, the unions now represent the interests of middle-class publicly employed women, presumably working in the NHS.
	And they are bleeding support at a record rate.
	And this lines up with other research that shows that Jeremy Corbyn's supporters tend to be depressed vegetarians.
	The most representative member of Labour's swelling ranks of new members is a middle-class Welshman in his early 20s who works for a charity.
	If you can believe it, which I'm sure you can if you have personally spent any time talking to Jeremy Corbyn's supporters.
	He does not represent the many, he does not represent the working class.
	He represents the middle class public sector workers who are demanding more and more money from the government, and they expect to tax the rich to pay for it.
	They are wrong.
	They will not be able to tax the rich to pay for this ever-increasing cost.
	But it feels good, saying, well, I'm in favour of socialism.
	I'm in favour of taxing the rich to pay for things for the poor.
	Except, you won't be paying for things for the poor, you will be paying for things for the middle class.
	And you won't be able to tax the rich, because they will simply leave.
	And your socialist system will fail in exactly the same way Venezuela's socialist system has failed, and that is the economic reality of it.
	If you are a middle-class, educated person, ask yourself, what is your education in?
	If it's not economics, if it's not political science, you are not educated on this issue.
	You do not know what you're talking about.
	You do not know anything about the government.
	You do not know anything about finance.
	You do not know anything about anything regarding this subject.
	So please remember that when you are making your analysis.
	So we will return to the IFS's assessment and look at the Conservative Manifesto.
	Turning to the Tory plans, he criticised the Tories for proposing five more years of austerity that were unlikely to be deliverable.
	Emerson said that a Tory government would be forced to either pull back on spending cuts or increase taxes to prevent further cuts in the NHS and schools from hitting services.
	Given how Theresa May has repeatedly said that she wishes to lower taxes, I'm going to presume that we will see service cuts.
	The Conservatives simply offer cuts already promised.
	Additional funding pledges for the NHS and schools are just confirming that spending would rise in a way broadly consistent with the March budget.
	Compared with Labour, they are offering a relatively small estate and consequently lower taxes, and with that offer come unacknowledged risks to the quality of public services.
	Emerson dismissed Theresa May's plans to reduce benefits to the elderly by means testing the winter fuel payment and scrapping the pensions triple lock as offering wholly trivial savings, and he said that the manifesto U-turn on a cap over care costs would result in presumably increasing public spending overall.
	The Conservative manifesto is going to produce more of the same.
	It is going to involve more service cuts in the name of austerity.
	And yes, this will mean cuts to the police and intelligence services.
	Which brings us to the subject of terrorism.
	Fortunately for the Labour Party, increasing the number of active policemen on duty is entirely compatible with impoverishing us all by attempting to bring about their socialist utopia.
	The Conservative response to the increasing terror attacks is way off the mark.
	Theresa May has said that she would like the internet to now be regulated following the London Bridge terror attack, saying that the terrorists had safe spaces online.
	And given how terrorism has become the number one concern of undecided voters since the London attack, I'm not surprised they would try and tackle the issue.
	But they are going about it in all the wrong ways.
	Her plan is, frankly, ludicrous.
	Anyone with even a cursory knowledge of the internet would be able to shoot holes in this plan.
	I'll go through a quick list of things that she has suggested.
	All Britain's communications must be easy for criminals, voyeurs, and foreign spies to intercept.
	Any firms within reach of the UK government must be banned from producing secure software.
	All major code repositories, such as GitHub and SourceForge, must be blocked.
	Search engines must not answer queries about web pages that carry secure software.
	Virtually all academic security work in the UK must cease.
	Security research must only take place in proprietary research environments where there is no onus to publish one's finding, such as in industry RD and the security services.
	All packets in and out of the country and within the country must be subject to Chinese-style deep packet inspection and any packets that appear to originate from secure software must be dropped.
	Existing walled gardens like iOS and games consoles must be ordered to ban their users from installing secure software.
	Anyone visiting the country from abroad must have their smartphones held at the border until they leave.
	Proprietary operating system vendors such as Microsoft and Apple must be ordered to redesign their operating systems as walled gardens that only allow users to run software from an app store which will not sell or give secure software to Britons.
	Free and open source operating systems that power the energy, banking, e-commerce and infrastructure sectors must be banned outright.
	I don't know how to put this, but this is a preposterous list of demands that will never be met or even considered by the industries these are going to affect.
	And I don't even want to know how many billions of dollars this is going to cost.
	And what's worse is it wouldn't solve the problem even if they managed to implement this.
	According to a pair of professors from King's College London, UK extremists are not actually radicalised via the internet.
	They say over the past five years, we have tracked the flow of foreign fighters in Syria and Iraq, collecting information on nearly 800 Western recruits, often including their social media footprints.
	Our experience and research suggests that radicalisation rarely happens exclusively online, and that the role of the internet is complex.
	However, our research suggests that the decisive factor in moving people from being extremists in terms of their thoughts and beliefs is not online propaganda, but offline social networks.
	They use the example of Andy Chowdhury and say, what he offered was a sense of community, belonging, and camaraderie within a circle of peers.
	The internet plays an important role in terms of disseminating information and building the brand of organizations such as the Islamic State, but it is rarely sufficient in replacing the potency and charm of a real-world recruiter.
	Perhaps more than any other radical cluster, the network around Chowdhury has been linked to scores of attacks, both at home and abroad, and dozens of foreign fighters joining the Islamic State.
	It is one thing for the internet companies to pull down radical propaganda, but they face an uphill battle while preachers such as Chowdhury have spent years spreading their message virtually unchallenged on British streets, or indeed, in British mosques.
	Unlike in the United States, Britain's mosques are dominated by highly conservative strains of Islamic thought.
	The most commonly feared school of thought is Wahhabism, but they only control 6% of Britain's mosques.
	The single largest group, which arguably gives Islam in Britain much of its character, is the Diobandi, who control around 45% of Britain's mosques and nearly all UK-based training of Islamic scholars.
	The Diobandi ideology is incredibly conservative and produced the Taliban from the madrasas of Pakistan.
	I couldn't find any information about the ideological affiliation of the perpetrators of the recent terrorist attacks, but I think if you had to start somewhere, investigating these mosques and what they are teaching would be a sensible starting point.
	Attempting to impose state control over the internet in the way that the Conservatives are suggesting is not going to work.
	It is probably not going to prevent any terror attacks.
	It is probably not going to be feasible to implement.
	And it speaks to a deep illiteracy of the internet when it comes to the Conservative Party.
	As I said at the beginning of this video, all of these issues pale in comparison to the looming Brexit negotiations.
	Brexit is the single most important issue the British state faces this generation, and it must be handled with finesse.
	There will be major economic upheavals during this transitionary period, and we are not in a position to try and implement revolutionary change while we go through it.
	I am completely bewildered that the Conservative Party is not making more of the economic issues that will arise from Brexit.
	We knew when we took this vote, when we voted to leave, that this would come with an economic price.
	So we have to adjust accordingly.
	We have to put ourselves in the mindset of someone who is going in to a fight, because this is what it's going to be.
	The Brexit negotiations are not only high stakes for Britain, they are also high stakes for the European Union.
	It is entirely possible, as I have said many times before, and I will say again, this represents an existential threat for the European Union, and we must understand that they will act accordingly.
	The first thing to remember is that this will cause widespread economic disruption in both the European Union and in Britain.
	According to Angela Merkel, everything from just-in-time auto supply chains to the free movement of workers and even their pet cats and dogs will be thrown into question by Britain's exit from the European Union.
	She says, if the British government ends the free movement of people, that will have its price.
	This is not malice.
	One cannot expect to have all the good sides and then say there will be an upper limit of 100,000 or 200,000 EU citizens, no more, or just researchers, but please nobody else.
	And she states flatly that this will not work.
	Now, I have never found an explanation as to why this will not work, other than from Yanis Varoufakis, the ex-finance minister of Greece.
	In a previous video I did about this, he said that they don't want to compromise on the four fundamental principles of the single market, which are the free movement of goods, capital, services, and labour.
	He is convinced that they will not compromise on any of these principles because they do not want to present the European Union as an a la carte buffet or supermarket in which member states cannot pick and choose the good bits as Angela Merkel says and then refuse the other duties that come along with it.
	They refuse this because it undermines the integrity of the European Union to do so.
	If other member states realize that other countries can indeed leave the European Union and still retain some of the benefits while not accepting other responsibilities, the European leadership believes that they will do so and the disintegration of the European Union will become inevitable.
	I believe that this assessment is correct and that it becomes an existential matter for the European Union to refuse to compromise on these four freedoms.
	This puts the interests of the European Union in direct opposition to the interests of the British public, because as has been shown repeatedly, immigration was the number one issue for the voting public, and immigration control is more important to British people than membership of the single market.
	When polled, 46% of Britons agreed that greater control over immigration was more important than access to free trade, while 39% disagreed.
	Immigration is the hot-button topic for the working class.
	They have been suffering because of mass immigration, in terms of both deflated wages and severe social problems that have come with the changing demographics of their communities.
	This is not necessarily the European Union's fault, but it certainly has put a lot of people, in fact most people, in the mind that immigration is a bad thing and needs to be stopped.
	If these people cannot be persuaded to accept the free movement of people from the European Union, then this means that the European Union and Britain have reached an impasse in which neither one is willing to concede, and then it becomes a game of chicken.
	So the question is, who is going to lose their nerve?
	The EU does have strengths in this regard, but it also has many weaknesses.
	One of its strengths comes from its sheer size.
	The multinational investment bank Berenberg says, whereas the UK earns about 12% of its GDP through exports to the EU, the EU 27% and 3% of their GDP through exports to the UK, the EU can cope without an EU-UK trade deal much easier than the UK can, since less of its GDP depends on the flow of trade between the two economies.
	This is of course true, and in this dimension it does give the EU the upper hand in these negotiations.
	But the question is more one of stability than raw power.
	As evidenced by the UK's withdrawal from the European Union and the strong Eurosceptic movements in major net contributory countries such as France and the Netherlands, the question is not who is going to be hurt the most by a lack of a trade deal between Europe and the UK.
	The question is who can endure the pain the longest?
	Theresa May has said that no deal is better than a bad deal, and it's important to remember that this will have severe effects on the UK economy.
	Economists forecast that between 2.6% and 5.5% of gross domestic product, between £50 billion and £100 billion, will be lost by 2020.
	This will be a much bigger initial blow to Britain than Britain's lack of trade with the European Union.
	However, the United Kingdom is one of only five countries that has a net contribution to the European Union of over €1 billion per year.
	When the United Kingdom leaves, this shortfall will have to be accounted for by the other countries.
	In addition to this, Merkel is aware that the United Kingdom may well seek a regulatory edge over the EU after Brexit.
	She says that the European Union needs to guard against the UK gaining an economic edge by easing regulation when it leaves the bloc.
	On day one after Brexit, the UK will be able to chart a new path by departing from the EU standards on environmental protection, consumer safety, and many other areas, Merkel told a business group in Berlin.
	The EU will need to develop mechanisms to offset any such effort and negotiate our future relations with Britain very thoroughly.
	Basically, we're reverse negotiating a free trade agreement, not to mention that we don't have experience in dealing with services and free trade accords, and that's an area where Britain is very strong.
	Dutch global investment bank ING sent a note to clients with the potential impact that Brexit would have on the UK as well as the rest of Europe.
	While both sides will start negotiations seeking a deal that will minimise economic damage and hopefully generate positive results for their respective electorates, things could go very badly.
	The political backdrop means that there are significant challenges and in the UK's case, this uncertainty could see more corporations choosing to sit on their hands rather than investing in their businesses.
	British households could also become more cautious, leading to a sharper slowdown in activity than we are anticipating.
	Should Sterling come under further pressure due to Brexit worries, then inflation will stay higher for longer, squeezing the spending power in the economy.
	Even worse, if there's an electoral successful anti-EU parties, the prospect of an EU breakup could return.
	Bad politics, combined with economic dislocation and financial contagion, would likely lead to a recession across Europe.
	An EU recession has also been predicted by a British academic who thinks that it may well kill off the Euro.
	Professor Patrick Minford, a professor of applied economics at Cardiff University, said the EU has by far the most to lose in the event of a no-deal scenario, which would place unbearable pressure on the bloc's weakest economies.
	He predicted Greece, which is laden with unsustainable levels of debt, would implode as a result of the economic shock caused by a drop in tourism and tariffs being placed on its exports.
	The academic's remarks came after a senior Greek minister warned that his country is set to lose up to 0.8% of its GDP just from a post-Brexit reduction in UK holiday makers alone.
	I believe that Theresa May's gambit is while Britain will suffer a deeper economic impact from the shock of leaving the EU without access to the single market, it could turn into a festering wound that the EU may not be able to heal.
	The shortfall in the EU budget will create additional pressure, leading to a rise in anti-EU sentiment among the more Eurosceptic member states, as they attempt to prop up the Mediterranean nations that will be adversely affected by Britain's departure.
	While this is taking place, May's plan is likely to do exactly what Merkel fears, and deregulate certain sectors of the economy, enticing foreign investment away from the continent, rebuilding Britain's economy while the EU's economy continues to decline.
	Of course, I might be wrong, but I think that her firmness in declaring that no deal is better than a bad deal is a tactical manoeuvre, and I suspect her reticence is born of a desire not to give the game away.
	I suspect that the ultimate purpose of this stratagem is not actually to try and destroy the European Union.
	I suspect it's actually to make them compromise on freedom of movement.
	Of course, I haven't discussed Labour's position when it comes to the Brexit negotiations, and that's because they don't really have one.
	When the European Union sprung a $100 billion divorce settlement on Britain, the Conservative Party flatly denied it.
	They said that they simply would not pay it.
	Jeremy Corbyn implied that he would.
	And this is despite the fact that refusal to pay the Brexit divorce bill would harm the EU's credit rating.
	So it is in fact leverage that the United Kingdom should use in the Brexit negotiations to get a more favourable deal for Britain.
	But Corbyn has already capitulated on this point.
	Given the unpopularity of freedom of movement, he said that he's not wedded to EU free movement, but refuses to limit migrant numbers.
	And it has also been claimed that Labour would end free movement, but not sever ties with the EU.
	Specifically seeking to end free movement, but not shut the door on the single market, the customs union or participation in EU agencies.
	I have no idea how they plan on doing this while they're giving away their leverage for free.
	By comparison, the Tories are promising to reduce migration to the tens of thousands, a target that has been repeatedly missed by the Conservatives and undoubtedly will not be achieved in any way, shape or form, but at least is a statement of intent.
	Whereas the Labour Party seem only to be advocating for the end of free movement as a point of political convenience.
	A donor from the Labour Party has called Corbyn's Brexit stance disappointing, presumably because he understands that this is not the catastrophe that Corbyn is making it out to be.
	Speaking in Essex today, Corbyn claimed that Theresa May's stance on quitting Europe was reckless and warned that failure to reach a deal would be the worst of all deals for the UK.
	However, the millionaire Labour backer John Mills, founder of the retail business JML, has labelled the Labour leader's pessimism disappointing.
	He says, Under World Trade Organisation terms, we would still have access to the single market under exactly the same conditions as the United States, China, Japan, India and Australia.
	The average tariff on goods is just 2.5%.
	Similarly, pessimistic forecasts were made prior to the EU referendum, yet our economy easily weathered the Brexit vote and continues to outperform expectations.
	It seems that the Labour Party have given up without a fight, and so they will make all manner of concessions to the European Union in order to stay in the single market.
	Corbyn's rock-solid commitment to this is leverage that Angela Merkel can use against Britain.
	To say, listen, if you do not agree to our terms, then you will be forced out of the single market, something that Jeremy Corbyn has publicly virtue-signalled to be the very worst thing imaginable.
	And if I know that, then they certainly know that.
	And they're certainly going to use it against Corbyn when it comes to negotiations.
	And when it comes to sitting down and discussing it, we will find ourselves agreeing to terms that are distinctly disadvantageous for Britain.
	And we will have no recourse to them because Corbyn has already agreed To everything.

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