16/06/2012 Dateline London


16/06/2012

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The headlines: UN monitors in Syria have suspended operations because

:00:02.:00:06.

of increasing violence. Major General Robert Mood says that the

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observers will not conduct patrols and will remain inside at their

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present locations. The White House says it is consulting its

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international partners about what to do next.

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Aung San Suu Kyi has finally given her acceptance -- except in speech

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for her Nobel Peace Prize 21 years after it was awarded.

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The Muslim Brotherhood in Egypt has reacted angrily to the dissolution

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of parliament, saying that the military council is trying to

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:00:49.:01:13.

derail moves towards democracy. Those are the headlines. Hello,

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welcome to Dateline London. The Spanish bail out, the Greek

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elections and the future of the euro, plus London's great summer

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entertainment, the Leveson Inquiry into press standards which heard

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from the prime minister David Cameron this week. The guests are

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Greg Katz, Cornelia Fuchs, Mark Roche and David Aaronovitch of the

:01:31.:01:41.
:01:41.:01:43.

Times. The euro has had more last chance bail outs than Frank Sinatra

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had farewell concerts. This week it was Spain and this weekend is the

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question of whether Greece will vote in a government that is

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committed to abandoning the austerity agreement. Meanwhile,

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Angela Merkel pointed out that Germany's pockets may be deep, but

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not bottomless. So where are we now? Let's start with a ray of

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sunshine. Mark Roche, you think it is not as bad as people have made

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out? You have a financial crisis which

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is worldwide, the US, Britain, the eurozone is victim of. The eurozone

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is slowly, painfully, putting its act together. We are seeing the

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bail out of Spain. Italy has a good industry and high productivity. The

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French have a left-wing government, reining in on expenses and Portugal

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and Ireland are slowly and painfully getting their act

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:02:45.:02:50.

together. I think I am quite optimistic about the euro. Greece

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is de facto, whoever wins, a small country with ten million people.

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The fact is that thanks to Germany and the solidarity among Euro

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partners the eurozone will get its act together. The real detached

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economy, which is doing badly in Europe, is Britain.

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Britain is not in the eurozone and is not immediately directly

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affected. If Greece votes for the SYRIZA government which says it

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will stay in the euro but tear up the austerity agreement, things

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will be different, won't they? It will have no consequence for the

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others, it could be a good thing. Greece leaves and get their act

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together, they can have the drachma and export. But the eurozone, the

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core of the eurozone is stronger than ever and is getting its act

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together under fortunately the German machine.

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I'll have some of what he is having! I will take some of

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whatever you are taking! French sunshine. Part of the difficulty if

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you are not actually in economics, a difficulty if you are an

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economics expert frankly, is to try and decide who in these sorts of

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situations when they think about what is going to happen in the near

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future has broadly got it correct and who hasn't and I find myself

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increasingly in a position of being unable to decide about it. I have

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heard sufficient from people who say that the Greek exit from the

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euro actually has extremely dire downstream consequences both for

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banks banks of other countries to be

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extremely worried about it and that is without even discussing the

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position that Spain is in after the question of whether that has been

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sufficient and as for us here in Britain, there we like, you have

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suggested that we have a bigger on the outside whereas of course

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the wisdom here very much is that we are outside, because we have a

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greater degree of flexibility, yet most of the indicators apart from

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unemploymen unemploymenwn significantly. We have seen exports

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down significantly, a sudden slump. Average incomes are back to 2004-

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2005 levels. The biggest drop in median incomes for 30 years.

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the gains wiped out incredibly quickly. It is difficult to know

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what Mark Roche was hinting at, a lot of people think if Greece has

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gone, so wh gone, so whonomy, it should not have been in the euro

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anyway, it might be better to get out, have the drachma back, the

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rest of Europe will cope, Spain and Italy make things that are

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exportable and are fundamentally sound economies and pay taxes, they

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are completely different? We know the alternative argument. There

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will be a massive devaluation in Greece. Almost everything people

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worth less. There will be a huge increase in unemployment. Anybody

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with money there will be significantly worse off unless they

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have taken it out and as soon as Greece has done it the markets

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start to look for the next country which is vulnerable, which might be

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a country as big as Spain. Cornelia Fuchs, everybody is looking at

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Angela Merkel to find out what she will do on Monday morning if she is

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faced with a government that is difficult to deal with in Greece?

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The good thing about Angela Merkel is you know where you are with her.

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Some say it is her stubbornness but she has said many times that Greece

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programme and then it gets the money necessary to get out of the

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economic problems it has. If it rejects the suggestions from Europe

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then basically they are on their own and I think if anything is

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needed at the moment it is perhaps some certainty and at least if the

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markets are looking for certainty they have that with Angela Merkel.

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Again, the counter-argument to that is if the Greeks are the good boys

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suddenly of Europe and do everything they are told to do by

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2012, they will still be in a mess by 2020, they will have a very high

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debt to GDP ratio and they will not get any real rewards, it is another

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eight years of suffering, it is difficult for them to put up with?

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Angela Merkel first said that of course they have the necessity to

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look at growth programmes but for her it is important to put one foot

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after the other, so you first have to have the structural reforms, or

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at least a notion that the reforms will actually work, then you can

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look at the growth programmes. You can't pour in money if nothing has

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changed. That needs to be solved. Do people in Germany, I know people

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in Britain think there is something about the smaller economies with a

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small number of voters choosing the future of Greece, which may choose

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the line in which 400 million Europeans have to go, in other

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words isn't that one of the, Mark Roche would talk about solidarity

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but isn't that a structural problem in Europe, you are dependent on the

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weakest link, Greece? It is one of the problems but it is also a

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strength. If Europe pulled together and shows it can pull out a country

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like Greece, then Europe would be stronger in the end. So the whole

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European concept of having a larger group of countries who stand to get

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there is an idea that still I think appeals to me and there are people

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who would want that to work. -- stand together. Greg, the United

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States has its own problems and are spectators on this one, but rather

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like George Osborne saying many of Britain's economic problems are

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directly related to the problems in the eurozone, the United States is

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fearful that if something bad happens here it will be worse for

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the Obama re-election team. I was going to mention that. It is

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interesting this week, Obama has had two bad weeks in terms of

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economic news and we have an internal election, very close now,

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five or six months away. Obama was trying to shift attention and say

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if the eurozone gets bad, it will gum up the system. He is saying

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don't blame me how bad things are here because they have messed it up

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over there, but that could be a passing tactic for Obama. You are

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having an intelligent discussion about Europe but much of the rest

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of the world sees the European process as something of a bad joke

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at this point. These leaders, the constant summits, the constant

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posturing and dithering, all of these leaders constantly getting

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together in Brussels in the hotels and coming out and saying next to

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nothing, it has been going on too long. Every day I drive to work and

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listen to Radio Four, and I hear the doom and gloom over and over

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again. Nothing seems to change. My sense is it is finally coming to a

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head but who knows what happens. Things have changed. All these

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meetings have meant there is a special stability fund, there is

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another fund to help the banks. We are showing this to the EU and the

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EU is a very cumbersome process, 27 countries, and the eurozone is 17.

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It takes time for all to find solutions and I think thanks to the

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European Central Bank we have coped with this crisis very well, knowing

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that the political things are difficult, the problem is that is

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no longer an economic problem, but a political problem. You need a

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banking union, a fiscal union, we, the 17 in the eurozone, have to go

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forward and forget about the political division. We need now to

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be more integrated, more federalist and then decisions will be easier

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to take. Do you see an appetite for that in

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France or Germany? The countries that most matter? Aren't we seeing

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amongst ordinary people the reassertion of the nation state?

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Germans are Germans, the Greeks are Greeks, the British are British.

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has always been the nation-state. We don't want the European

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conglomeration, do we? But it has brought growth for so many years,

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no war, all that. We are working very well in Europe, it is very

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prosperous. At the moment we are going through a difficult time and

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people are suffering and it is very important therefore to put growth

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behind, in the forefront, and cut less expense. We have to emphasise

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growth. That discussion, if Cornelia Fuchs

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doesn't mind taking the role of Angela Merkel, no to austerity, yes

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:12:14.:12:18.

to growth, she is giving a different message. One of the big

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problems for Britain is that we now see it as being in our interests

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that the greater integration you are talking about happens. The big

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problem for you is it is not straightforward. It is the problem

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for Italy. Are you prepared to accept the weaker countries of

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Europe? They have to be perpetually invested in out of European

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solidarity. The problem for Britain is if you go ahead with a much more

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integrated Europe, then we really are facing the problem on the

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outside. To some right-wingers and Tories and Euro-sceptics that is

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exactly what they have wanted and probably the majority of the

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British people before we come to a referendum about it, for somebody

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like me it is an incredibly worrying proposition. Isn't that

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the crunch point, for Angela Merkel, she wants more Europe, but she

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means more Europe that has the core values that Germany has and some

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other countries to the north and that is not replicated in the

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countries to the south and the question is, to go back to Marc's

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point, you have to continue to bail out countries which are not

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functioning in the same way that Germany does? Yes, of course, that

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is the line she wants to take, but of course European discussions are

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always in the end a compromise so Angela Merkel is very good in

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pointing her own ideas and then in the end finally doing a compromise

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that works for everyone. She has proven that a lot of times in

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internal politics and I think Europe has never been a dream

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project for the citizens in Europe but if it comes to the crunch, in

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the end, if people have to decide if they want to have Europe, if

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they don't want to have Europe at all, I think in the end they will

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decide for Europe. German voters and French voters and British

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voters like the European Union guaranteeing there won't be another

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major war in Europe, everybody is agreed on that, but what German

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voters do not like is the idea that constantly their money is going to

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be poured down what some of them see as a bottomless pit, which is

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perhaps why Chancellor Merkel reminded people that Germany's

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pockets are not bottomless this week. Exactly, she spoke to German

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citizens with that speech and it is important to see that there is

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still money there. They are preparing another bail out already

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now and Germany will vote for the fiscal pact on 28th June, so things

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are moving onwards but there still needs to be a discussion with the

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voters in Germany as well and I think one of the problems is the

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whole situation sometimes has not been explained very clearly and

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truthfully. I think politicians would have explained it much more

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truthfully, we just have to do this, let me put it another way, I pay

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solidarity taxes since I have been working for East Germany. Everyone

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agreed to it. There is a discussion if these solidarity taxes are still

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necessary nowadays. You could argue in the same sense there is a

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solidarity tax for Europe that needs to be paid. But it is a

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harder sell. But you would need to try to sell it. In Europe, we help

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the poor. It is not like in America where the poor are left to

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themselves. Italy likes the north, but Italy, the loss of Europe.

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of the rich don't like paying taxes It is not a perfect organisation

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but in general, rich countries have helped poorer countries. Let us

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move on. None of us remember a British investigation like the

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Leveson Inquiry. Many people are subjected to lengthy forensic

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investigation about people in power and he media. Are we really getting

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somewhere? Will have statutory press regulation be the end.? All

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will be government have better things to do with it time? There is

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a view that this is something for the media junkies and newspapers

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and television. People don't really care. People in Britain are worried

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about whether they will have a job next month. This difficulty where

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we address that question in that way... Most people do not care. I

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almost gave up a long time ago. It is not the first time we have been

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through this. This is the fourth. This is now becoming part of the

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progression of British history, which is that everybody's Tex will

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get out and read by everybody. not in such an entertaining way.

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I thought, even I am not interested in this. Whether people are

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interested or not, comes a secondary question. Can't we say

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this is not important? It has become incredibly infused by what

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:17:56.:17:58.

we think is being important. -- Is this about press behaviour or

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about Rupert Murdoch's influence? Ed Miliband sees Rupert Murdoch as

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a road block into getting a left- wing government. Those two circles

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intersect. It is in Ed Miliband's interests to make sure that those

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circles are congruent and that they overlap. But intellectually they do

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not. You can see why David Cameron Watt to separate those circles

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:18:40.:18:41.

entirely. What do you make of this? It is a coup d'etat. You have the

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press, Rupert Murdoch, the police, the media, the political left and

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right. If he does have the courage of the Guardian, this thing will

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not even... You cannot even control me, let alone the police. You have

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control by Murdoch at the highest levels of the political system.

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Never has there been a situation like this. The inquiry has lost the

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plot talking about those two lines of inquiry. For me, it was about

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criminal wrongdoing, hacking, and the obscene things they did to

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celebrity is. For me, the first six weeks were riveting. But then it

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got to an abstract thing of, what is the right way to regulate, who

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had to know with whom? It has gotten quite tedious. They have

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lost the plot. It is not about, does Rupert Murdoch have too much

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influence, or what is the best way to regulate. It is about the

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:20:21.:20:21.

Freedom of Information being used as a cover-up. There is information

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about a stock market dealings. That is what interested me. There

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were a lot of criminal deed being done. That is pretty provocative

:20:31.:20:36.

and shocking and a damning for the press. The idea that Rebekah Brooks

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is coated with David Cameron, exchanging text, was fine reading.

:20:42.:20:49.

We covered it. I would expect Rupert Murdoch to try to use

:20:49.:20:59.

influence over the Prime Minister. In a similar way that Richard Nixon

:20:59.:21:05.

was being influenced. Listening to three consecutive prime ministers

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trying to defend their relationship with media proprietors... I found

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that interesting and something that I had never heard before, certainly

:21:15.:21:22.

not in a German context. Press and politics, together, to not exist.

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On that scale, I found it interesting. I wonder what Lord

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Justice Leveson will do with this. It is clear that some people are

:21:31.:21:41.
:21:41.:21:44.

not entirely telling the truth. Gordon Brown... Whip over Skinner

:21:44.:21:54.
:21:54.:21:56.

ties and over deliberate on It happens between you and your

:21:56.:22:02.

wife and me and my wife all the time. When we get to the Richard

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Nixon level... I remember having a Gordon Brown was angered by how the

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:22:32.:22:34.

Sun and treated him. But when he said, I never knew that anybody was

:22:34.:22:44.
:22:44.:22:49.

against Tony Blair, he never asked Rupert Murdoch said he never used

:22:49.:22:55.

his papers to promote his own business interests, which is

:22:56.:23:05.
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It is seen as immoral or wrong for Rupert monarch to change the

:23:14.:23:24.
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It is a question of institutions being undermined by Rupert Murdoch.

:23:39.:23:46.

In what way? Murdoch has put his agenda on Europe. There is nothing

:23:46.:23:56.
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wrong with that. It is clear that Tony Blair took no notice at all.

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What he tried to do was present these things at the summit in a way

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that would have meant it would Rupert Murdoch went right to the

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institutions. Do you think this is heading towards more press

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regulation? People talk about their dissatisfaction with things. Ed

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Miliband and John Major talked about this. Is any government going

:24:40.:24:50.
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to spend a lot of time taking on the press? Including people at the

:24:52.:24:58.

BBC. Journalists don't like regulators. There is a reason for

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this. The outcome of this inquiry should not be another regulator.

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The Press Complaints Commission needs more power in reprimanding

:25:10.:25:14.

its members. I do not think it should get closer to fricassee of

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the state. -- bureaucracy. Putting it all on the table and letting

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everyone see it is already an outcome. That is the important

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thing. Regulation in the US is dead anyway. It should lead to a change

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so that journalists can no longer break the law. I do not think we

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should ever be able to break the laws of a country and justified it

:25:44.:25:50.

by saying, the story is worth it. The argument fails. David Lee has

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been let off by the prosecution service on exactly that basis. They

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have already ruled that there is a public interest defence for his

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phone hacking with an arms dealer. I would see the difference between

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armed dealers, terrace and had a files. What we are coming back to

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is not the question of legality but public interest. -- terrace and

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I think it is important that Britain does not see privacy laws

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like France. This allows politicians to us corruption.

:26:46.:26:56.
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That's it all today. Follow us on It should feel warmer today. That

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is partly because there will be less rain. They should be brighter

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skies and a more sunshine. The winds should be lighter. A bright

:27:30.:27:39.

start for many. Clouds left in north-east England. Rain is

:27:39.:27:49.
:27:49.:27:49.

retreating to the coastal areas. Sunshine along the coast.

:27:49.:27:53.

Temperatures will be higher than yesterday. More rain to come,

:27:53.:27:58.

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