EU

Mulligan Brexit again

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Rebel Tory MP Justine Greening is calling for a second referendum on Brexit to end a parliamentary deadlock. There was never any doubt that ‘leavers’ wanted OUT of the EU. It was pretty clear cut. “Leave the European Union ✅ or ❌” Not half in or any other form of compromise. At what point will politicians get it through their thick skulls that constituents do not want mulligan politics? If some don’t like the outcome, just keep swinging until can deliver the minority the result they wanted? Best of three? Why not conduct parliamentary elections this way? Swing and a miss!

UK PM Theresa May has shown utter incompetence in executing Brexit. She stupidly called an election which cost her a majority forcing her to side with the DUP just to hold onto power. She couldn’t read that the electorate was sick of voting as CM pointed out at the time. She was punished for it, despite the massive lead in the polls she had. One might almost think it was deliberate given the soft stance she has taken on Brexit and the total disregard for the referendum.

Despite jawboning last week there would be no negotiation post the resignations of David Davis & Boris Johnson she has had to cave in to hard line Brexiters (305 vs 302) on the Customs Bill. A narrow 303-300 vote to exit the EU’s VAT scheme post-Brexit was also reached. Shadow chief secretary to the Treasury, Peter Dowd said, “it took two years for the Prime Minister to reach her Chequers deal, but only two days for it to fall apart.” He is not wrong. May has bungled it so poorly one wonders if it isn’t deliberate.

What should be seen here is that politicians (from any party) voting against what their constituents put forward will be political suicide over this.  There is a genuine sense in the House of Commons that all of this will somehow wash over like politics has for decades.  While many might see the ructions inside the Tories as a godsend for Labour’s Jeremy Corbyn (to an extent it is), even he has to realise that almost 40% of his party’s voters wanted to leave, meaning the members from those areas that expressed their intent leaves mixed messaging for the party as a whole. Watch for a resurgence in UKIP.

In any event May needs to go. She should resign. It is unlikely that she will. She is even thinking of bringing summer recess forwards to reduce the chances of a no confidence motion although both Labour & Tory members have quashed the idea of this. 48 members must write letters to the 1922 backbench committee to call a no confidence motion and Theresa May would need to win over half the 316 seats held.

Yet we only need to look at drunkard EC President Jean-Claude Juncker and ask why any UK politician thinks there is merit in negotiating with an unelected mob that can’t walk in a straight line even when sober? Keep calm and Brexit hard.

Presidential behaviours

While the glass jawed POTUS has many shortcomings, surely the unelected EC President Jean-Claude Juncker does the EU absolutely no favours by being sozzled to the gills at a NATO summit. One has to ask PM Theresa May how she thinks the EU is a credible opponent to negotiate Brexit? No deal seems a no brainer.

EU – 1.3m abortions, 5m births p.a.

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Eurostat statistics on abortion reveal that Germany, France, UK, Spain and Italy alone terminate a combined 760,000 fetuses per annum. Across the EU-28 there are 1.25mn terminations. Without getting into a debate on abortion rights, the pure statistical number points to 20.4% of fetuses never make it out of the womb alive. Every. Single. Year. At that rate over 10 years that is 12.5 mn children that could have added to EU population sustainability do not occur but the EU seems to think embarking on mass migration is the only solution to plug the gap. Is it? Ironically child support is one area the EU is happy to cede control to individual Member States.

The fertility rate across the EU-28 is now 1.58 children per woman, flat for the last decade and down from 2.9 in 1964. Demographers suggest that a fertility rate of 2.1 is required in developed world economies to maintain a constant population (in the absence of any migration). The number of live births in the EU-28 peaked in 1964 at 7.8 million. In 2017 this had fallen to 5 million. There was a brief period (2003-2008) when live births in the EU-28 started to rise again, returning to 5.5 million by 2008 but the GFC sent it down again – as economic hardship tends to cause a decrease in births. So are economic incentives too low to cause a rebound?

France has the best incentives for children and the highest birth rate inside the EU at 2.0 up from 1.7 in the 1990s. Germany is around 1.4 drifting from 1.6 in the 1990s. The lives for child rearing French are eased by cheap health care, inexpensive preschools – for infants as young as 6 months old – subsidized at-home care and generous maternity leave. Mothers with three children can take a year off of work – and receive a monthly paycheck of up to €1,000 from the government to stay home. Families get subsidized public transportation and rail travel and holiday vouchers.

In order to stop the declining working population over time, imagine if Europe hypothetically put the onus back on consenting couples to take responsibility for their actions and makes abortions harder to access without compulsory consultation over options? Why not graphically show the entire process to get some sense of reality for both parties? You can gross yourself on this link.

Perhaps, in today’s electronic world, automatically deducting child support from fathers that run from responsibility might make sense? Why should the state pay for others’ lack of accountability? Even if the child is placed in foster care, why not wire child support to foster parents indirectly via the Ministry in charge of its administration? The population crisis is not going away in Europe. Why not provide more incentives to married/same-household couples?

Mathematically speaking the numbers are huge. Imagine if the million-plus fetuses every year had a vote to be raised with foster parents as opposed to being terminated, what they would choose? Consider the €23bn Merkel has spent on mainly economic migrants in the last 2 years being put toward preventing 200,000 abortions in Germany over that period? €115,000 to avert each one might have been better spent. That is a huge sum of money period.

CM is not advocating control over the womb but surely transparency in policy over individual responsibility is not a bad thing with respect to many issues, not just abortion. What level of economic incentives are required to prevent some couples/women choosing to terminate? Surely that plays a part in deciding to terminate. Consultation services with respect to the subject don’t seem too commonplace or at least structured in such a way as to prevent them.

According to Eurostat, since 1964 the divorce rate in EU-28 equivalents has doubled and the marriage rate has halved. For every eight marriages in 1964 there was one divorce, now there is one divorce for every two marriages.

The proportion of births outside of marriage now stands at 40%, from 27% in 2000 to less than 7% in 1964. 8.8 % of the EU-28 population aged 20+ lived in a consensual union (de-facto). In Japan the number of births out of wedlock is 25% according to the MHLW. The dynamics of the traditional nuclear family are fading.

51% of the Swedish population is now single household. 51%! While some is attributed to an aging population, 19 of the EU-28 members has a single household ratio of over 30%. 12 over 35%. By way of comparison, Japan’s single household ratio stands at 34.6% from 27.6% in 2000.

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To further analyse the new ways of living together and to complement the legal aspect, statistics on consensual unions, which take into account those with a ‘marriage-like’ relationship with each other, and are not married to or in a registered partnership with each other, can also be analysed.  Sweden (18.3 %) has the highest rate followed by Estonia (16.4 %), France (14.3 %) and the lowest in Greece (1.7 %), Poland (2.1 %), Malta (2.5 %) and Croatia (2.9 %).

Is employment a factor?  It is mixed. Eurostat reported in Germany, the fertility of non-employed women has increased and that of employed women decreased, while in Spain, the opposite occurred; in Greece, the total fertility rate (TFR) of non employed women fell below that of employed women, changing from a positive differential of about 0.2 average live births.

Is education a factor? Apart from Nordic countries (Denmark, Finland and Norway), Portugal and Malta, in general, women with lower education had higher TFR between 2007 and 2011. Eurostat state the fertility of women across the EU over the same period with a medium level of education dropped by about 9%, while the decrease for women with high or low education was less significant.

Eurostat argues that economic recessions have correlation to falling child birth rates. Apart from the direct impact of economic crises at an individual level, the economic uncertainty that spreads during periods of hardship seem to influence fertility. From this point of view Eurostat believes the duration of a crisis may play an important role and, the duration and the depth of the current recession are unprecedented in some countries. The agency states,

The expected relationship is that negative changes in GDP correspond to negative changes in the TFR, possibly with some delay, thus showing a high positive correlation at particular lags. The correlation with the TFR is relevant in Spain and Latvia without any lag; in Bulgaria, Poland and Romania with one year of lag; and in the Czech Republic, Denmark, Estonia, Greece, the Netherlands, Finland, Sweden, Iceland, Norway and Croatia with two years of lag. Taking the overall average across countries, a change in GDP is mostly positively correlated with a change in the TFR within about 19 months.”

Do we cynically argue that stagnant child birth rates aren’t just a factor of societal changes? Perhaps a truer reflection on the higher levels of poverty in the EU since GFC and the harsh realities for a growing number of people behind the growing levels of populism who are suffering greater economic hardship than statisticians are presenting to the political class? Hard decisions must be made before they are made by external factors.

Child Abuse – the shocking stats

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Child abuse is reaching shocking proportions globally. The stats you are about to read show just how widespread the problem has become.The National Institute of Health reports that approximately 80 % of those who attempted suicide had a history of child abuse. About 30% of abused and neglected children will later abuse their own childrencontinuing the horrible negative spiral.

We examine the US, UK, Australia and an outlier Japan, where child abuse cases have soared 111-fold in the last 30 years. Over 4,000,000 child abuse cases were reported in the US in 2015. Abused children show much higher tendencies for risky behaviours in later life. CM wrote about the shocking outcome of the independent report on child grooming gangs in Rotherham showing that the police and government were complicit for decades. We also wrote about abuse affecting safety at US schools, including mass shootings.

Warning – the data make for quite heavy reading. 

JAPAN

In 2016, CM wrote a piece on the breakdown in the nuclear family in Japan. The Ministry of Health, Labor & Welfare (MHLW) denoted that cases handled for child abuse in 2016 hit a record 122,578 cases, 111x the level of 1989. Part of the problem here would be due to a lack of reporting back then. However the growth in the last decade is still extreme. The MHLW denote over the last decade:

  • Physical related violence fell from 41.2% to 26% (despite doubling in absolute terms).
  • Neglect fell 38.5% to 21.1% (despite an 80% increase in absolute terms)
  • Sexual abuse fell from 3.2% to 1.3% (despite a 50% increase in absolute terms)
  • Psychological abuse jumped from 17.2% to 51.5% (a 10-fold absolute increase)

In the last decade filings of child abuse with the police have surged from 7% of all cases to 45%. Reporting to family or relatives has declined but neighbours remain the second largest factor in reporting abuse.

By prefecture, child abuse per 1000 children looks as follows as at 2016. The national average stands at 7.3 children per 1,000.

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AUSTRALIA

While the rate of growth is high, Australia’s Institute of Family Studies has reported in its June 2017 statistics that in 2015/16 a total of 355,935 notifications of child abuse were made vs 252,962 made in 2011/12. Total substantiations grew from 48,420 to 60,989 respectively.

The rate of notifications has risen from 33.8 per 1,000 children in 2011-12 to 42.0 per 1,000 in 2015-16 (AIHW, 2011, 2017).

  • Physical abuse accounted for 18.3%
  • Neglect  accounted for 24.9%
  • Sexual abuse accounted for 12.2%
  • Psychological abuse accounted for 44.5%
  • 51% of victims were female.

In Queensland, South Australia and the Northern Territory neglect was the most common type of substantiated maltreatment. Victoria had the largest proportion of emotional abuse substantiations (64.5%) compared to other states and territories, whereas South Australia had the smallest proportion of emotional abuse cases (25.2%).

While there were some gender differences for all abuse and neglect types, girls were significantly more likely to be the subject of substantiation cases of sexual abuse (15.8%) compared to boys (8.5%). The proportion of substantiated cases of harm/risk of harm from child maltreatment related to sexual abuse ranged from 3.4% in the Northern Territory to 16.6% in New South Wales and Western Australia.

Infants (children aged less than 1 year) were most likely to be the subject of a substantiation (16.1 per 1,000 infants), followed by children aged 1-4 years (9.0 per 1,000 children aged 1-4). Children aged 15-17 years were the least likely to be the subjects of a substantiation (3.9 per 1,000 children aged 15-17).

Australian children from remote and very remote areas were most likely to be the subject of a substantiation (16.2 per 1000 and 23.5 per 1000 respectively) compared with children in major cities (6.2 per 1000). Children in lower socio-economic areas were more likely to be the subject of a substantiation than children in higher socio-economic areas, with 6.9% of substantiations occurring in the highest socio-economic areas compared with 35.7% in the lowest socio-economic areas. 

This contradicts the trend in Japan were relatively poorer (tend to be remote) areas seem less prone to incidents of child abuse.

Perhaps the disturbing sign in Australia is the incidence of out of home care (OOHC) which continues to swell in numbers. Between the years 2014-15 and 2015-16 there was a 10.8% increase in children (from 11,581 to 12,829 children) admitted to OOHC. In 2015-16 there were 3,035 more children admitted to OOHC than were discharged.  In 2015-16, the median age of admission to OOHC was 6 years, with 46% of children admitted to OOHC aged under 5. In comparison, the median age of discharge from OOHC was 9 years and 32% were aged 15-17, compared with 8% admitted to OOHC.

Most children who were in OOHC on 30 June 2016 were residing in home-based care (94%). Of these children, 39% were in foster care, 49% were in relative/kinship care, 5% in third-party parental care and 1% were in some other type of home-based care.

USA

The US is a whole other category. While the media screams about the mistreatment of children at the Mexican border how many of them know the extent of child abuse within their own country? The American Society of Positive Care of Children notes,

  • 4 million child mistreatment referral reports received in 2015 vs 3.6mn in 2014.
  • Child abuse reports involved 7.2 million children vs 6.2mn in 2014.
  • 207,000 children received foster care services.
  • The financial cost of child abuse and neglect in the US is estimated at $585 billion (equivalent to the GDP of Sweden or Taiwan)
  • 75.3% of victims are neglected.
  • 17.2% of victims are physically abused.
  • 8.4% of victims are sexually abused.
  • 6.9% of victims are psychologically mistreated.
  • Highest rate of child abuse in children under one (24.2% per 1,000).
  • Over one-quarter (27%) of victims are younger than 3 years.
  • Almost five children die every day from child abuse.
  • 80% of child fatalities involve at least one parent.
  • 74.8% of child fatalities are under the age of 3.
  • 72.9% of the child abuse victims die from neglect.
  • 43.9% of the child abuse victims die from physical abuse.
  • 49.4% of children who die from child abuse are under one year.
  • Almost 60,000 children are sexually abused.
  • More than 90% of juvenile sexual abuse victims know their perpetrator.
  • 14% of all men in prison and 36% of women in US prisons were abused as children, twice the frequency seen in the general population.
  • In 2016, more than 2,300 children were reported as victims to the National Human Trafficking Hotline.
  • Average age of entry by a child prostitute is 13 yo. Life expectancy after becoming a prostitute is only 7 years57% of prostitutes were sexually abused as children.

UK

Government figures show that 3,171 offences have been recorded in England and Wales across 80 platforms in England and Wales since a new anti-grooming law was introduced in 2017 which criminalizes sexual communication with a child. This amounts to almost 9 grooming offences on average per day. The police noted that

  • girls aged 12-15 were recorded in 62% of cases of grooming
  • under-11s were recorded in nearly 25% of cases.

Child abuse figures in the UK according to the NSPCC reveal

  • 1 in 20 children in the UK have been sexually abused
  • Over 8,000 contacts to the NSPCC’s helpline last year were concerns about sexual abuse
  • There are an estimated 137,000 women and girls affected by FGM in England and Wales
  • 1 in 14 children have experienced emotional abuse by a parent or guardian.
  • Over 19,000 children were identified as needing protection from emotional abuse in 2017.
  • 6.9% of children said they had experienced physical violence at the hands of a parent or guardian (3.7% said severe physical violence).
  • The NSPCC’s helpline responded to over 11,000 contacts about physical abuse in 2016/17
  • Over 6,000 children were identified as needing protection from physical abuse last year

The message is clear. The incidence of child abuse continues to rise to sickening levels. Perhaps the EU sums up its problem to an even more shocking degree:

“Few studies have been done on neglect, but analyses of worldwide research shows that prevalence is also high − 16.3% for physical neglect and 18.4% for emotional…They show a prevalence rate of 9.6% for sexual abuse (13.4% in girls and 5.7% in boys), 22.9% for physical and 29.1% for mental. Applying these figures to the population of children in Europe suggests that 18 million children suffer from sexual abuse, 44 million from physical abuse and 55 million from mental abuse.”

Maybe part of preventing neglect starts with the very basics:

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So when we see media reports wailing about injustices which are relatively tiny in the grand scheme of things, perhaps we can reflect on the real problems that are right in front of our noses. #LetsEndChildAbuse

Slovenia slaps the EU too

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Slovenia has joined the list of populist movements. In 2000, there were 4 countries in the EU that had populist coalitions/majorities (Lithuania, Latvia, Switzerland & Austria). Scroll forward to today we have 15 (the previous 4 countries + Poland, Norway, Czech Rep, Italy, Slovenia, Hungary, Greece, Slovakia, Crete, Bulgaria, Romania). Neighboring Bosnia and Serbia are also populist led. We shouldn’t forget the in the populist/nationalist party surges in The Netherlands, Germany and France . Perhaps more amazing is that the EU still isn’t getting the message, most highlighted by the push to get the President of Italy to put in charge a non-eurosceptic former IMF employee as PM. That’ll work.

So to Slovenia’s election. The Slovenian Democratic Party (SDS) topped Sunday’s election on 25%, handing the anti-immigrant party 25 seats in the parliament. Center-left LMŠ, led by comedian and political satirist Marjan Šarec, came in second on 12.7% (13 seats), and the Social Democrats third on just under 10% (10 seats). SDS leader Janez Janša acknowledged forming a governing coalition will be difficult.

Juncker typified all of the arrogance that has propelled so many anti-establishment parties to power. He said, “Italians have to take care of the poor regions of Italy. That means more work, less corruption, seriousness.” Stereotyping rarely helps. Juncker also made clear that Italy’s problems are not the EU’s fault.

Time and time again, when studying poverty within the EU, the overwhelming number of countries inside the bloc remain worse off than in 2008. Growth rates remain anemic. If you were to look at a map of the floodgates of illegal immigration (which Deutsche Bank published) it isn’t a surprise that the local populations are voting for those governments that will seek to look after the citizens first. So before casting aspersions on a growing number of EU citizens’ assessment of the human rights of asylum seekers, the reality is that the socialists within the EU are clearly utterly dreadful at messaging and even poorer in execution. Then again Baroness Thatcher warned them of that in 1990.

If the status quo is so good why would we vote out the incumbents?

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Almost everywhere we look, we’re told by the political class how good our lot is. Our blessed Aussie PM told us, “It has never been a better time to be an Australian.” Boosted asset prices, low unemployment and tepid inflation gives the illusion of real wealth for everyone. As an electorate, if all of that were true, why wouldn’t we be going out of our way to make sure the status quo gets voted back in with similar if not greater majorities? As it stands, more and more incumbent parties are hanging on by their finger nails, being forced to create alliances to stay in power rather than stick to the principles their parties were founded on. The irony is that these grand coalitions are formed on the tenets of ignorant ‘un-populism.’

The latest election cycle shows us that a growing number of people aren’t buying mediocrity. They’re sick of incumbent politicians ignoring them. The current crop of leaders seem to think that being less worse than the opposition is a virtue to be proud of. Yet poverty levels continue to rise and wealth is not trickling down to the masses. Even rising state entitlements have a finite life and the electorate knows it. Being married to the government is not seen as a desirable strategy long term. Deficits keep rising and look increasingly hard to pay down.

Searching through the St Louis Fed database, civilian employment under Obama managed to grow 2.5% on pre-crash levels. So the US loaded up on $9 trillion in short term debt to create 4 million net new jobs. That works out at $2.25 million per worker. Hardly an achievement. Yet despite that economic growth has dithered at the lowest post recession rates ever. As much as we might want to celebrate record low unemployment these are not proud statistics. The quality of jobs keeps going down. $8.4 trillion of this federal debt load needs to be refinanced inside 4 years. $12.3 trillion inside 10 years. While politicians can call the average voter stupid, the daily struggles of the average punter shows how out of touch the law makers are. This was the grand mistake made by Clinton. While she hung out with her elite mates at $1,000 plate dinners in Democrat strongholds in LA, NY and Chicago expecting a coronation, Trump hit the little people and had crowds flocking to see him.

While Trump’s trade tariffs seem daft on the face of it, it was done for the forgotten people who voted for him. He is not concerned about the consequences. That’s the point. So much of his platform appears abhorrent but he is the only politician in danger of being raked over coals for keeping his promises. That’s why he was elected. The status quo had failed to deliver over decades. 80% of the population didn’t benefit from the asset bubble post GFC. The 1% took 42% of those gains. The average Joe and Joanne see this. While they might not fully comprehend it they know enough to see their situation is not much better.

Take a look at Trudeau’s India debacle. Apart from the embarrassing wardrobe saga, the bigger problems came when he blamed the Indians for letting a known terrorist attend a state dinner. The Indians, unsurprisingly, were most unhappy at the accusation. Many look to Trudeau as the posterchild of the left, pushing peoplekind. Telling Canadians that he will convert returning ISIS fighters with haiku poetry, podcasts and comparing them to Italian migrants at the end of WW2 is utterly preposterous to his constituents. Telling his veterans they’re asking for too much flies in the face of love of one’s country. No wonder his popularity continues to dive. His speech to the UN – where he rattled off how Canada was ticking all the UN diversity boxes – was only a quarter full. Not even his own liberal mates rallied to show unity in numbers. It was telling that virtue signalling is all about appearing to do good rather than doing it.  Yet the day before Trudeau presented, Trump spoke of America First and the audience was packed. They might have hated every word that dripped from his tongue but they didn’t miss it for the world. It is hard talk. Not carefully prepared politically correct nonsense.

Take the recent European elections. Germany gave Merkel the worst ever performance of the CDU post WW2. The SPD was even worse. The anti-immigrant AfD stormed to 16%. Is it any wonder that when Merkel’s misguided altruism  showed up on Election Day even she finally conceded we have a problem with “no go zones”. Some may wish to look at the Merkel miracle of growth and low unemployment but the public service in Germany has exploded from 9% pre 2008 crash to 16% today. Not private sector growth but public sector.

The Italian election showed over 60% of the vote went to eurosceptic parties. While volatility has always been a feature of Italian politics, this results showed the discontent underbelly of Italy which has seen poverty jump 50% to one third of the population since Lehman collapsed. While M5S said it wouldn’t form a coalition, all bets are off if it tied up with League. There are plenty of overlaps on the party platforms but the M5S would have to insist on the PM role. The EU would go into a tailspin on such news.

Austria voted in a wunderkind who put the right wing anti immigrant FPO in charge of immigration. Holland saw Wilders claw more seats. Nationalist Marine LePen in France doubled the number of seats ever attained by the Front National. Even Macron is changing his spots looking to introduce national service and take a harder line against migrant crime.

Whether the real statistics of migrant crime are wholly accurate or not is beside the point. It is increasingly seen as an election issue and more EU countries have had enough. They feel their lot is getting worse and view forking out billions in aid for people to settle here is pennies out of their pocket. If the stats are as the government sugar coats them to be in terms of the prevailing prosperity surely the citizens would overwhelmingly back them. Sadly the opposite is true meaning politicians aren’t selling their “compassion” effectively. Too many examples of gagging the police and muzzling the press have surfaced.

That is the thing. If the economy was rosy and bullish and more people felt secure there is a likelihood they would look at the immigration debate in a more positive light. All they see now is millions flocking to Europe as poverty is on the rise and the economy is on the back foot at ground zero. European EU-28 GDP hasn’t grown since Q4 2015. Despite a quadrupling of ECB assets net jobs created post GFC numbers 4 million, labour force participation remains below the peak. However we should not forget that Romania and Bulgaria joined in Jan 2007 and Croatia in 2013 which would add (at a 50% employment ratio) c.20mn meaning that employment in the EU on a like for like basis as a whole is down 16mn jobs ceteris paribus. Even if only Croatia was included then net jobs creation in EU-28 would be a paltry 2mn, or a smidgen above 1%. Anemic.

Yet the political class still doesn’t seem to be learning, especially the EU. Poland and Hungary have formed a pact to reject proposed quotas on migrants. The EU has failed to address the most important question. The wishes of the migrants themselves. It is one thing for the EU to appeal to voters as saving asylum seekers from war torn lands (when 80% are economic migrants by the EU’s own numbers), it is another to forcibly send them to countries that flat out don’t want them. Ask for a show of hands of asylum seekers looking to stay in Germany or head off to Hungary to settle and the likelihood is 100:0. Trying to make Hungarians or Poles feel guilty for being incompassionate is a price they’re clearly willing to pay with losing EU membership. Would we take kindly to a neighbor telling us how to arrange our furniture in the living room or sign a petition to prevent us building extensions even though it is not even in their way? Of course not. Still wagging fingers in disapproval is only likely to steel their resolve.

Flip to the Southern Hemisphere and Australian politics is also exposing the sordid state of the swamp. 5 PMs in 10 years. Now the Deputy PM has had to resign to the back bench and in a last ditched effort to claim some sort of moral high ground with the staffer he was having an affair with. He claimed he would still look after her even though a paternity test might show the kid wasn’t his. What a grub and a slap in the face for his partner to imply she may have been promiscuous. Once again the popularity of the incumbent parties in Australia continues to sink to all time lows. The Labor Party looks to have the next election in the bag but even then the popularity of the opposition leader is woefully tiny.

While the world seems to be in this state of blissful tranquility on the outside, we needn’t probe too deep before seeing how bad things continue to be on the inside. The little people may not have any financial fire power but at the ballot box they have an equal opportunity to stuff those that aren’t listening. Once again Italy shows us it wants change. Call it populism if you must but it is truly a reflection of just how bad things really are and how little ammunition to deal with any future crises remains. The little people are raising their voices. Best heed their words. It is the same reason why as zero chance as Trump looks in 2020, don’t bet against another 4 years in the White House. If the Dems hope that celebrities that talk of #METOO and gun control (all the while they attend Oscars semi-naked and collect their millions doing action films full of explosions and automatic weapons fire) will sway them to a return to the swamp they’re sorely mistaken.

Italy votes – will it mimic the referendum?

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Remember the 2016 Italian referendum which was to decide on  whether to grant more power to the incumbent party to accelerate decision making? Well it ended up being a vote on ousting then PM Renzi who put his resignation on the ballot if it failed. The split between the yes/no was largely decided by economic condition. The poorer southern regions were distinctly red while a smattering of wealthy areas voted green (yes).

It is kind of telling that the furthest province in the north (Bolzano/Bozen) had the highest YES vote (63.69%) in the country while the Province of Catania (south-east Sicily) had the highest NO vote at 74.56%. Bolzano/Bozen was diligent with a 67.41% turnout vs 57.41% in Catania. It is a rich/poor divide by the looks of things. If you wish to dig into the details look no further than this site for who voted how.

The last poll showed Beppo Grillo’s eurosceptic M5S party leading with 28%. Berlusconi’s centre right Forza Italia alliance with the anti-immigrant The League is expected to get around 29%. The incumbent PD is looking at around 20%.

Since the collapse of Lehman in 2008, Italy has added 3mn to poverty (now 18mn or 29.7% of the population; EU average is 25%) with the unemployment rate above 11%. Since Merkel’s open door policy 600,000 illegal immigrants have flocked to Italy from Libya.

Italy is the 3rd largest economy in Europe and 30% of corporate debt is held by SMEs who can’t even make enough money to repay the interest. The banks have been slow to write off loans on the basis it will eat up the banks’ dwindling capital. It feels so zombie lending a la Japan in the early 1990s but on an even worse scale.

Monte Dei Paschi De Siena, a bank steeped in 540 years of history has 31% NPLs and its shares are 99.9% below the peak in 2007. Even Portugal and Spain have lower levels of NPLs. The IMF suggested that in southern parts of Italy NPLs for corporates is closer to 50%!

However one views the rising wave of nationalism in Europe, Italy will likely follow the pattern of Austria, the UK, Germany, Holland, Poland, Hungary and France. A growing number of European citizens want to be first in line rather than feel they have an EU directed obligation to bow down to political correctness. How else do we explain the AfD’s surge past the SPD?

If the eurosceptic/anti-immigrant patties get up  we shouldn’t be the least surprised. More Europeans want their own countries to be made great again. The house of cards is crumbling.