13/12/2011 Daily Politics


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Afternoon, folks. Welcome to the Daily Politics. Our high streets


are in crisis - that's the verdict of the government's retail tsar,


Mary Portas. So what can be done to regenerate them?


After last week's deal, are European politicians any closer to


discovering the elusive solution to the euro-zone debt crisis?


France blackballed Britain from the Common Market.


Do you get a sense of deja-vu? After Britain wields its opt-out,


President Sarkozy says there are now "two Europes" - it is the


latest cross-Channel spat that has lasted - well, centuries.


And do shrikes leave strikers any All that in the next half-hour.


With us for the whole programme today is the general secretary of


the PCS union, Mark Serwotka. And no Andrew this afternoon. He


decided his presence next to me in the studio today would be a


distraction. But don't worry, a bit like Nick Clegg, we are hoping he


will pop up a bit later on to explain himself.


First this morning, our high streets are in crisis. That's the


conclusion of a report for the Government by the so-called Queen


of shops, Mary Portas. She says many high streets will be lost


unless councils and shops work together to regenerate them.


Whereas the high street was always just about shopping, that shopping


has shifted into new areas. We have the internet, we have these out-of-


town malls, the hypermarkets and supermarkets. We have not redefined


what the high street is. We have let it go and neglected it. We have


not had a vision. I propose that we look at a high street in a


different way, as a multi- functional social and shopping High


Street, so that we create ft fall back on the high street for other


uses other than shopping. Mark Serwotka Hamas -- how important is


the high street? Is important not just to the high street, but to the


communities we live in. But the first thing to do is make sure


people have money to spend it in shops anyway. Part of the problem


at the moment is that many are having a cut in their living


standards. And therefore, there is not much disposable income to spend.


It does not help when in many communities, the Government is


withdrawing from high streets. We have seen Jobcentres closing or


licensing offices. 39 of those are closing. It is about jobs, I take


your point about consumer spending and people needing money in their


pockets. But in terms of getting to the shops, should the Government


focus attention on the retail sector at this time of year? It has


to do what it can to regenerate our economy. What support can be found


for small businesses and shops, we have to find it. But at the end of


these -- at the end of the day, for these businesses to be a success,


they need people coming through the door with money to spend. That is


the real issue at the moment. We need to create jobs, create demand


in the economy and make sure people can spend. That is the best way to


regenerate the high street. Now, we are expecting a crucial


press conference in Europe this afternoon. After all-night sessions


and passionate disagreements over the details, scientists at the


Large Hadron Collider in CERN are expected to announce the answer to


life, the universe and everything - the discovery of the famed Higgs


boson particle. Unfortunately, despite claims that the euro-zone


debt crisis had been solved after press conferences in Brussels last


week, doubts are beginning to surface. While particle physics has


relatively few unknowns, economics, especially that of the euro-zone,


seems to be a far more inexact science. European politicians have


spent months rushing around in a circular motion, colliding with


each other in the hunt for the Holy Grail of euro salvation. The latest


experiment involves a new fiscal compact, with new rules as


immutable as Newton's Third Law of motion. This new compact will be


combined with an application of physical force - a 200 billion euro


bail-out fund provided by national central banks via the IMF to prop


up countries at risk of default. But at the moment, this is more


theoretical than the Higgs boson, with only the German Bundesbank


pledging EUR45 billion. And that sum is a mere fraction of the


galactic 600 billion that would be needed to bail out both Italy and


Spain. But the markets continue to exert their own inevitable logic,


with bond yields in those Club Med countries creeping up again and the


euro sliding against the dollar and the pound. So can Europe's leaders


finally re-write the laws of economics and save the euro and


avoid a catastrophic big bang? Andrew's at the European Parliament


in Strasbourg, from where he joins me now. It sounds like this deal


that has been put on the table is unravelling? Yes, it is. We have


already had a minister in France, the man the polls say will be the


next President, saying he wants to renegotiate the deal agreed last


week. The Austrian Chancellor does not like it. The president of the


German parliament does not like it, and thinks it may be


unconstitutional. The ratings agencies are talking about


downgrading every European Union credit ratings. So the sense that


the deal that was done last week has anything to do with the current


sovereign debt crisis, they are far apart and it is beginning to


unravel. The Americans have also made it clear that they will not


put any more money into the IMF. A source in President Obama's White


House said to me, if you think the president is going to Congress to


get money for the Europeans in an election year, you must be on


another planet. Be if no one is going to put more money in and


everyone says it is not enough at the moment, not the big bazooka


that is needed in terms of bailing out a country as big as Spain and


Italy, where do they go from here? They go to another crisis. Word


reached me from Berlin today that the Chancellor is even talking


about another summit before Christmas. We have already had six


this year. If not, there will be one early in the new year. While


they talk about all sorts of things to do with fiscal union and 3%


budgets and balanced budgets and so on, the markets are having their


way. The Spanish and Italian bond yields are under pressure again,


the euro is at a recent low against the dollar, and there is no


firewall, as the Austrian Chancellor said. There is no


firewall big enough to protect Spain or Italy at the moment. Last


week's European summit did nothing to put one in place.


I am joined now by the former Foreign Secretary Jack Straw and


from Paris by Jacques Myard, an assembly member in President


Sarkozy's party. Jacques Myard, talking to our colleagues in


Strasbourg, it does sound like the deal that was done will not happen.


Is that your sense as well? It is not that the deal will not happen,


the question is how the deal can solve the problem. Frankly, I have


great doubts that we will find a solution to save the Eurozone. We


are going to put the Eurozone in a straitjacket by controlling and


cutting expenses. But that is not the solution. The solution is a


lack of competitiveness of some members of the Eurozone, like


Greece, Spain and even France. We are facing a wall, which is that


this Eurozone is absolutely inadequate for the strengths of our


economies. So what is needed to happen? If you say this is not


going to be enough to stem the Eurozone crisis, you are talking


about competitiveness, what do these countries need to do?


short-term needs, if there is no militarisation of the debts, that


means genuine aid coming from the central bank to those states, they


will pay their debts more expensive live. In the long term, we have to


think, is this single currency adequate for our economies? Of


course, I have always been reluctant towards the euro. I think


we have reached the end of it. We have to face the reality. I am


sorry to say that in many terms, the French political classes and


European political classes are in a kind of religious belief, saying


that the euro is Europe, and there is no future apart from that, which


is wrong. We need to face reality. Listening to that, Jack Straw, no


one thinks it is enough. No one thinks it will work. The Eurozone


crisis is going to lurch on, isn't it? Running a single currency


outside a single country is inherently difficult, and that is


one reason why I was never in favour of it, but that is what many


countries opted for. If you are going to do that, you have to have,


as George Osborne has acknowledged, a fiscal union, which was at the


heart of the agreement formed last week. That is a necessary part of


salvation, but by no means a sufficient part. As you and this


gentlemen have just said, if you want to solve the immediate crisis,


you have to monitor as centrally the debt of Europe. That is


something Chancellor Merkel will not do. No, and without it, the


Eurozone cannot move on. I think it will move on with great difficulty.


It surprises me that the German Chancellor, although she has


problems in her own backyard like every other head of a Government,


she does not acknowledge and lead her people to say, we are the


people who have month -- most benefited from the euro. Why can't


we now assist in keeping the euro together? Jacques Myard, do you


agree with Jack Straw that the Germans have to make the central


bank come up with the goods now and without it, this crisis will get


work? I have always said we need to monitor rise the debts. That means


we need strong help from the central bank. The treaty forbids


that. But this can only work if you transfer money from the strong to


the weak countries. And Germany knows that if they do that, they


will have to pay up to 4% of their gross national product in transfers


to Italy and Spain etc, which is more expensive than the


reunification of eastern Germany and western Germany. Even in France,


Mr Sarkozy is now looking at the prospect of downgrading from the


credit ratings in France. But the French economy is not strong either.


You can't expect it also to come up with that kind of money, because it


itself is vulnerable. Yes. A downgrading of France is not so


awful, because I think all countries will be downgraded. The


only point is that our -- it will be more expensive for France to


borrow. So I think we have to change monetary policy. As Mr Straw


just said, we need to monitor as that. If we do that in the short


term, we will be facing a wall and it will be more expensive and it


will be the end. Jack Straw, is it the case that Britain's position


outside not only the 17, but the 26, if we were at that table, would we


be able to influence more to persuade the Germans to let the


central bank by government bonds and let them rescue the Eurozone in


a way that we can't now? Yes. If you read the conclusions of the


European Council last Thursday and Friday, you will see that a number


of countries in the EU -- in the EU but outside the Eurozone said they


reserved their position. David Cameron could have done that. He


could have completely preserved all his negotiating position. He was


not signing up to anything formal, but he would have been in the room.


His difficulty and now the country's difficulty is that


gratuitously, he has lost influence. Would it have made a difference?


course. I have seen these negotiations. It is a fact of life


that heads of government have very large egos. Tell us something we


don't know! It is about national interest, but it is also about


their interest. This matters, because these guys are very


powerful. John Major understood that how you deal with it makes a


reunification. The result was that when he needed something,


Chancellor Kohl said to him, what can I deliver for you? In this


situation, we need a resolution to the euro crisis. Schadenfreude is


not a policy. Our future depends on Of course, the British did not sign


up to the agreement in Brussels last week. Nicolas Sarkozy rejected


outright Britain's demands for an opt-out on City regulation, which


he said was not acceptable. He added that there are a now clearly


two Europes. Is this just another salvo in the centuries long tiff


with our neighbours? Let's start in the 17th century, when this French


bishop is one of the first to be recorded using the phrase,


perfidious Albion. In other words, cheating Brits. Fast forward to the


1960s, the news reels were fretting about vetoes then, too. Charles de


Gaulle had denied Britain's application to join the group which


was to become the EU. We finally got membership in the 1970s. Then,


along came this lady, in a fetching jumper. They will be keeping an


all-night vigil under the statue of Winston Churchill, the first person


to have the great vision for working together for peace in


Europe. Instead, war was waged by the Sun against the French man in


charge of the European Commission in the 1990s. His request for more


powers begat this famous soundbite. No, no, no! Tony Blair's language


was warmer, but the relationship was spoiled by the French banning


this, British beef, and disagreeing with this, the Iraq war. Now, the


theory is that the French are trying to pinch business from the


City. President Sarkozy, normally famously shy about speaking English,


knows that money talks, as demonstrated by this clip from a


few years ago. You are welcome to invest in France. We will be happy


to help you make money in France. And of course, to make some money


with you - for us. There we go. And the two Jacks and Mark Serwotka are


still with me. Is the entente cordiale dead in the water? It is


not dead in the water, it is damaged. Don't forget they were our


great allies in the First World War, and they are then faced German


occupation in the Second World War. We are two similar-sized countries,


both on the Security council, have remarkably parallel although


different histories, very proud of our nations, but we need each other.


My experience of dealing with the French, sometimes they could drive


me mad, but I daresay I could drive them mad. But you could co-operate


with them. As far as the current commissioner is now concerned, the


commissioner on business regulation, I had a lot to do with him. He was


the French Foreign Minister. He's French, I'm British, but this guy


is not gratuitously going to damage European businesses. You can get


alongside these people. I'm not naive at all. But I do not believe


you need to damage diplomatic relations in the way that we have


done, as David Cameron has done. Jacques Myard, Nicolas Sarkozy


accused David Cameron of shouting from the sidelines about the


eurozone crisis - is the relationship damage in that way, as


we have just heard from Jack Straw, or is it all politics? I do not


agree with Jack Straw. Our relationship, our diplomatic


relationships, are much stronger than these last events. I tell you


this morning, the French are more interested in Jonny Wilkinson's


decision to retire than David Cameron and any comment like that.


So, don't worry. No, in fact, in the view of Sarkozy, there are two


kinds of Europe. There is the euro Europe, that he is trying to save


with Germany, and there are other relations, especially in terms of


defence, and world powers, which we do with Great Britain. We signed a


treaty in the last few months on Nuclear Corporation, and this is


very important. This has all been a bit of a sideshow, Mark Serwotka,


saving the eurozone from its crisis is the most important issue, not


this treaty - how do you see the relationship between Britain and


France, is it important as far as the unions are concerned? My only


beef with the French is that they beat Wales in the Rugby World Cup,


with a very unjust outcome. The European trade unions, in France,


Britain, Germany and Greece, have issued a statement in the last 24


hours. What we say is, the people who are suffering in Europe are


working people - people losing their jobs, having their incomes


cut, their pensions slashed. None of what has happened over the last


few days, it seems to me, has really been about addressing the


needs of working people. They're trying to save these countries from


a debt crisis. They say they are. But the view that we have is that


it is the wrong answer to the problem. We need to grow our


economies, and we want to grow our economies and deal with the deficit


over the longer term. What we want to do is open the debate up and say,


why aren't any of these European leaders talking about the role of


the markets, the fact that the markets are unaccountable, are now


picking governments in parts of Europe, setting social policy,


effectively? We know that the markets do not care about the


welfare state and the NHS, like we do. So we need a more fundamental


discussion, not fiddling while Rome burns. A couple of weeks ago,


members of Mark Serwotka's union, the PCS, were striking over the


Government's proposed pension reforms. A fierce battle has raged


over whether public sector workers were right to go on strike. But


there is another issue. Our strikes in general effective means of


getting your own way? Here's Giles. It is a fact of modern industrial


relations that both unions and managers have started to see the


strike as something of a last resort. Unions have discovered more


sophisticated ways of industrial action, short of a strike, and


private sector managers have discovered the economic value of


compromise. So, is it time to ask the question, what do strikes


achieve? The range of outcomes and his wide, from the success of women


workers at Ford's Dagenham, whose strike led to laws on equal pay, to


the failure of the miners to keep pits open. Most end with compromise,


or compromise comes first. Bylaw, disputes are more specific, strikes


are harder to call. There is more concession bargaining, less big


causes. We deal with about 900 disputes per year. When I went to


work for ACAS in 1976, we were dealing with 7,500. The threat of


strikes is very often effective, and that is one of the more recent


developments, with changes in the law requiring unions to ballot


their members. They can then say, we have balloted our members, and


they are willing to come out on strike, now, what more have you got


to offer? Clearly, in the recent pensions dispute, things have come


to a head. Militants, itching for a fight. They want families to be


inconvenienced. We are not itching for a fight. But we do need


ministers who want to reach an agreement with us. Despite the


disappointment of the party opposite, it looks like something


of a damp squib... But from experience of conciliator in many


disputes, it may seem like two sides are at war, but it can be


very different behind the scenes. The difference between the


collective dispute, trade union and employer, and an individual dispute,


is that in the collective dispute, the union and the employer have got


to cope with tomorrow. Whereas genuinely, with an individual, the


relationship is ended. So, there is much more of a meeting of minds


than perhaps the public rhetoric would suggest. Increasingly, old


unions have taken a lead on new tricks, with more sophisticated


options, short of strikes. strike is a nuclear option. It will


only do that if there is really nothing else that can be done. It


is expensive, it is difficult, quite often unpopular, and unions


use strikes as a last resort. I cannot think of any union which


would simply go on strike for the sake of it. The strike in itself is


not a principle, it is a tactic. There are does politically who will


say strikes achieve nothing whatsoever. But there is one


undeniable answer to that. You're never going to know what would have


happened had there not been a strike, you're trying to measure


something which is unmeasurable. If there had not been a strike, what


the employer have offered more? You do not know. Mark Serwotka is still


here, and we're also joined by the Conservative MP Dominic Raab. Mark,


can you give any recent examples of where a strike has had a positive


effect? In the last few months, PCS, employed in a private sector


company, a multinational company, offered a derisory pay rise, went


on strike and it ended up getting an 11% pay increase for the lowest-


paid. Very interesting, because what it said is that if industrial


action in the private sector is going to make a company realise its


profits may be effective, they will come round the negotiating table.


What do you say to that? private sector it rather different,


you have got far less strike days lost in the private sector, the


whole dynamic is very different. The whole issue with effectiveness


is that if your aim is to cause damage, a strike will do that. We


saw in the most recent strikes damage done to parents with schools


closing. If your aim is to carry public opinion, I think they have


failed. If you look back Mark's union, just one in five of his own


members backed the strike, which is why, if I'm a finish, you seek


instantly suddenly consistently from June to November, the polls


are showing that they had lost the support of the public. Strike


ballots only need a majority of those who take part, not a majority


of those eligible to vote, and that is a real problem with the public,


is it not? You're talking about far smaller numbers than the unions try


to paint. I disagree. You cannot disagree that it is with the


majority who take part. If we start talking about thresholds, we would


not have Boris Johnson in his current post. It is an unnecessary


hurdle. We have the most restrictive union laws in any


Western European country. It is fantastically difficult. I have


said to the government, and I will say it again now, if they want


bigger turnout in ballots, we have made numerous suggestions to make


it easier to vote, telephone, online, in the workplace - they do


not want to know. Do you think that would make a difference? Of course


it would. The public will not thing strikes are credible if you have


such low numbers voting... I think actually, in all strikes, the


times bigger than those who actually cast the vote. The turnout


which matters is on the day. In the strike we have just seen, two


million people on strike to stop a raid on their pensions, it was one


of the most effective demonstrations of opposition to the


Government which we have seen in recent years. Except, the


Government make concessions on the threat of strike, not the strike


itself. Since then, there has been nothing. Actually, it was the


tiniest concession. I have just come from the TUC this morning, and


we have started discussing further industrial action. The reason for


that is to get the Government around the negotiating table. They


have not met us since the 2nd November. We want a negotiated


settlement, but if they are not even in the room, it becomes


impossible. What do you say to that, Dominic? Will this mean the


Government will feel it has to make another concession? Well, they have


already made a massive concession. If you're a carpenter, a cabbie or


a hairdresser, you will be looking at the reformed pensions which


public sector workers will be getting, and it is way out of the


League of what the vast majority, the hard-working majority in this


country, will be able to access. I think if we have a further threat


of strikes, you will see more ebbing of public opinion, and I


think the unions have lost it. The real question is this - the


government is out of touch with ordinary, hard-working people. I


think it is the militant minority of hardline union leaders, who have


not accepted a cracking offer on the table, though, with their


inflation -- inflated salaries and pensions, are looking increasingly


out of touch themselves. I think you should not be able to have


hundreds of people paralysing the infrastructure in London, which


disrupts millions, on the votes of a few hundred people. If ever there


was confirmation of a government being out of touch, it used to


describe as a cracking offer, work eight years longer, pay thousands


of pounds more in, it is robbery. But equality of misery is not a


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