13/01/2016 Newsnight


13/01/2016

The Danes want to make migrants pay their way. Labour's Trident row hots up. Oil dips below $30. Airbnb safety. With Evan Davis.


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Transcript


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Is Europe in the midst of an anti-refugee backlash,

:00:00.:00:00.

as Denmark, part of liberal Scandinavia,

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We think that it is fair, that they should pay for their stay in

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Denmark. Why should taxpayers pay for the period of time that they are

:00:27.:00:28.

living in Denmark? Refugees and migrants

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are a big issue for Europe - Labour's leading In campaigner,

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Alan Johnson, gives his reaction. And Labour's internecine

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war over Trident, will their defence review pour cold

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water on it or more petrol? The co-chair of the review tells

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Newsnight we'll soon We will desperately try to do it

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as rapidly as possible, so we will focus on the Trident

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issue ahead of the rest And that could be

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done within months, Also tonight - a bleak time

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for the black stuff. And Airbnb, the website

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where you can rent, or rent out Is the so-called sharing

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economy the future or just Watch out for a surfeit of headlines

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using the phrase "something is rotten in the state of Denmark"

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or variants thereon. Because Denmark is set to move ahead

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with a package of measures to deter asylum seekers from

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trying to settle there. Expropriating their assets to make

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them pay for their stay - not a wedding ring or items

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with sentimental value, but cash or possessions worth

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more than about ?1,000. Delaying the point at which families

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can join mothers or fathers. The United Nations ranks Denmark

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as the fourth most developed country in the world, but the UN

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High Commissioner for Refugees called the measures "deeply

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concerning", and an affront Well, this latest Danish response

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to the flow of people into Europe is part of what looks

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like a backlash at the liberal values that have enticed people

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to this continent. Katie Razzall reports from

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Copenhagen. What do you take with you when you

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leave your home and travel thousands of miles by boat, by bus, on foot?

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Is it those sentimental possessions that remind you of the life you once

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had? Or valuables, to sustain you on the journey? This Iraqi family told

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me they had left Baghdad for Copenhagen with a few clothes and

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some money, which quickly disappeared. TRANSLATION: We only

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brought the essentials, nothing really valuable. We paid all the

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money we had to the smugglers to bring us here. There was anger today

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outside the Danish parliament as, insight, politicians debated and new

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Immigration Bill. In future, rivals to this country will be searched,

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and assets like money worth more than 10,000 kroner or ?1000, and any

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valuables, although not wedding rings or mobile phones, will be

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compensated -- confiscated to reimburse the taxpayer for the cost

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of looking after them. We are looking to limit the flow of

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refugees coming into Denmark and those who are coming into Denmark,

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we think it is fair that they should pay for their stay. Why should the

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taxpayers pay for a period of time that they are living in Denmark? We

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think it is quite fair. I actually do not understand why there has been

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such a big debate about this. It is just common sense. Unlike Sweden,

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Denmark has been tightening up its laws on migrants for some time. But

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there has been nothing quite as controversial as the plan to strip

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them of their valuables. The Prime Minister, keen to protect his

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country's reputation as a just and fair society, says this is the most

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misunderstood bill in Danish history. With Europe floundering

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over how to deal with the migrant crisis, will other countries

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introduce similar measures? Last summer, in the wake of the death of

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the boy washed up on a Turkish beach, Europe felt like a much more

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friendly place for migrants. Germans welcomed them with flowers and food

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and the strangers into their homes. Back then, hardliners who floated

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concerns about integration, were castigated for their pitiless nests.

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But now the mood is hardening as fears about crime and community

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discord grow and Europe is putting up fences in an effort to shut

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people out. Across Europe, there has been a race to the bottom as states

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have been trying to outbid each other on creating restrictive

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policies to make asylum seekers seek asylum in neighbouring states rather

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than their own. Denmark has been part of that and I think this

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current bill is part of the politics of deterrence, whereby the Danish

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state is actively cultivating a new image as being unwelcoming to

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refugees. Last June, here in Denmark, they had a change of

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political leadership. If you have watched an episode of Borgen, you

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will know that compromise is everything in Danish politics. If

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this was an episode of Borgen, in the end, Liberal values would

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triumph. But right now, in reality, it is the right setting the agenda.

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That has meant cut in -- tough changes, including cuts to migrant

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benefits of up to 50% and new Danish language requirements before

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permanent residency is offered. Migrants already can't

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bring family over for The government wants

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that up three years. And shorter residency statuses

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being given to those The Prime Minister recently even

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called for reform to the UN 1951 20,000 migrants like these came to

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Denmark last year. They are awaiting news on their status in a country

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whose leadership apparently wishes they had never arrived. What does

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this family think of the planned to take away people's assets?

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TRANSLATION: Of course it is not a good thing, I don't like it. For

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people like us who left Baghdad or those who travelled from Syria, they

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lost their houses and money. It is hard for them to lose whatever

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remains. They already lost jobs, houses and maybe relatives in the

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war. It will be hard to take what they have. They will have nothing of

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value left. The Immigration Bill will be voted on later this month.

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But the government says it has the backing of enough parties to get it

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through. Watching closely will be other European nations with an eye

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on opinion polls at home. Out of all this arises one

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overarching long-term question for Europe,

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and a short-term tactical The short-term one is

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whether the recent turn of events in the refugee and migration debate

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will affect Britain's EU referendum To put it bluntly, will it

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derail the In campaign? The bigger question

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is whether migration will challenge what we like to regard as European

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tolerance and openness. One man who should be reflecting

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on both these is the former He was in government at a time

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when migration into the UK was high, and he is now in charge

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of Labour's pro-EU campaign. My first question, is the recent

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refugee crisis in Germany and Sweden going to damage the campaign? It

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could damage it, but if you use that as the answer, you will come out of

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the European Union. You might as well come out of the United Nations.

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It is an issue for them as well, big movements across the world.

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Withdrawing from these organisations will march the lack solve it. --

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will not solve it. We are in the best position, we are not part of

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the Schengen Agreement but we are part of the Dublin accord. People

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coming from outside the European Union, they will need to register in

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the first country they come to. If we are outside the European Union,

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that would not be the case. But we are part of Schengen, so you need a

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visa. It will make things worse. Incidentally, our most vulnerable

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point, Calais to Dover, because we are part of the UN we have good

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relationships with France, we have a border control in Calais. The first

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thing that will happen if we take back our borders, France would take

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back its border and our most vulnerable point in these islands

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would be more vulnerable still. I would make the argument that we will

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be worse off outside. You acknowledge it might be an issue

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that damages the campaign? It happened over the summer. The number

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of people in terms of appalling that work pro-EU reduced over the summer

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when they sought that kind of footage. -- in terms of the polling

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that were pro-EU. But when you get down to the real campaigning, it

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means talking about the facts. The public will think of migration and

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refugees as intertwined issues. They will think we have many people

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coming in from the continent of Europe and we do not have control of

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our border with the continent, because anyone with a passport can

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come to Britain. Now what is your lying going to be, through the

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campaign, through the referendum, to most people, who would say, if we're

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not in the EU, we get more control over who comes to our country? You

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are going to have to have an answer to that. Yes, and the answer is that

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that would not happen on any of the models that the campaign are looking

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at. You would not have control of the border if you left? Because the

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Germans or the Swedes or citizens of Italy... If we did have that, we

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would have an economy that was plummeting and we would be in a

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sorry state, because if we apply those measures, they were bright

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apply those measures as well. Britain has more people living

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abroad, working in developed countries, than any in Europe,

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including Poland. It is a two-way street. All the models that say you

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are outside Europe but you take advantage of the biggest commercial

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market in the world, bigger than the US or China, involve free movement.

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Can I ask you, are you in favour of free movement, basically? Suppose

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that Europeans came to us and said we could doubt. I am in favour of

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it. Do you think the public like it? I think the public would see the

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benefit, that you cannot have this... Children in particular,

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teenagers, youngsters, they happily cross borders without even thinking

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about it. Families go on holiday to Spain and they do not need a visa.

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When you look at the practicalities of moving away from free movement,

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then you go back in time to a world that did not exist in terms of this

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nirvana of the 50s. You go back to a less tolerant world, a world that is

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less prosperous and a Britain that is less able to punch its way

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through the world. I wonder, is a sense out there that government,

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people in authority, have pulled the wool over the public's ice? They

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feel that in Germany and Sweden where the police are scared to talk

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about migrant crime. Frankly, they feel it was something that the

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Labour government did with migration and they never really said they were

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going to let a million Polish people into the country but many more

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people came into the country than the public expected. There is this

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sense of the EU being a slightly elite project which has moved away

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from what the public were told it was about, and not necessarily what

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they wanted to be about. I think as you get into the debate on the

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referendum, the unavoidable question, are we staying or are we

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going, I think we will concentrate on these misconceptions. We will

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make the argument for Europe which has not been made on the left for

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ten years. I am leading a united campaign on this. The Labour Party

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has changed since 1975 but I think we also have exposed the thing, what

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did we vote for in 1975? I was there and I delivered the leaflets for the

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yes campaign. Looking at that again, it was about the European economic

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community, about closer political union, it was the idea of setting up

:12:57.:13:00.

a European Parliament. All this stuff of saying we voted just for

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the common market, it is not true, and there are lots of things wrong

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with Europe and lots of things wrong with the United Nations. There is

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not a perfect institution but in a sense, are we better being part of

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our continent? Through this forum, the forum through which we can

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handle our independence? The answer must be yes on every kind of level.

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Are you saying that when the public voted yes to the common market in

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1975 they could have anticipated all of the things that could have

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followed? They might be scared of voting yes in 2016 if they think

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there will be that much happening thereafter. The arguments to people

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who were not around at the time, including Nigel Farage, because I do

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not think he was old enough to vote, is that we have just voted for a

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market. Now, you didn't. If you look back, you can research it. There was

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no pulling the wool over the eyes? Far from it. The yes campaign was

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very straightforward. For example, we said it would not solve our

:14:04.:14:07.

economic problems, it would not resolve our prosperity but it was

:14:08.:14:10.

part of something bigger and increasingly interdependent. The no

:14:11.:14:15.

campaign, they said that if you stayed in, it would be part of a

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country called Europe, there would be no Italy or Germany. Read it.

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That fantasy of one country, as if the Germans or the Italians would

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want to be part of that country. But it is dead. Have you told them it is

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dead?! Cameron made the point in Parliament, the other day, that

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there is a great deal... Europe, when necessary, nation states

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usually deal with these issues. But give me, in a sentence, the

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emotional pitch. Give me the positive vision for being in the EU?

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It is that the European Union was created after world wars on our

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continent that started every 20 years. In 1975, the guys in the post

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office were people who had fought in those wars. They had seen very much,

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as Churchill put it, ... I wonder whether you think that is still

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something that works? We're not going to war with Germany, in or out

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of the EU. Might it need updated. It is out of date. It is useful to

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remind people. When we debated this in 1975, Franco was in power in

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Spain. The whole block of eastern Europe was under totalitarian rule.

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They have moved from oligarchy to democracy without a shot being

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fired, that is part of the poetry of working together on this continent.

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The prose, it is trade. The market, nobody loves a market but as you

:15:48.:15:52.

know, this is a crucial part of our prosperity. I'm going to say to you

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that the pros are as important as the poetry. And that suggests that

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walking off into isolation means walking off into isolation in the

:16:03.:16:07.

world. I am interested in whether you buy into David Cameron's

:16:08.:16:11.

renegotiation attempt. He has obviously set out his agenda. You'll

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like what he is trying to do or is your lover for the EU on

:16:16.:16:20.

conditional? -- do you like what he is trying to do. It is not love. I

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am not a fanatic but I think that most of the British public, I hope,

:16:26.:16:30.

on balance, think that it is better that we are in the European Union. I

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think it is a sideshow and it is more about the future of the

:16:35.:16:36.

Conservative Party than the future of the country but as I want us to

:16:37.:16:40.

stay in the EU, I wanted to do enough to allow him to come and fly

:16:41.:16:46.

the flag for Europe. Do you think it is a bit of a sham? I think so. The

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other thing is the referendum will not be on that package, it will be,

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do you want to stay or do you want to go. Trident is looming as an

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issue and it looks fraught. Will it damage the party if they chose to

:17:01.:17:05.

reject Trident? I hope not. I hope it shows that we have

:17:06.:17:06.

reject Trident? I hope not. I hope debate, like what is going on in the

:17:07.:17:11.

country, and we have come down, after having deliberated on this,

:17:12.:17:15.

one way or the other. One thing is for sure, we cannot have to

:17:16.:17:20.

different positions. And your position? I am pro Trident. I am pro

:17:21.:17:25.

nuclear disarmament through multilateral disarmament. Everyone

:17:26.:17:31.

is looking for that. Do you have any regrets about not standing in that

:17:32.:17:35.

leadership election? A lot of people, they were saying just the

:17:36.:17:40.

other day, you were the only one that could potentially have beaten

:17:41.:17:44.

Jeremy Corbyn. I wonder, giving you are on a different wing of the

:17:45.:17:48.

party, if you look back and think, why did I not do it, I could have

:17:49.:17:52.

taken him on? I wonder how many times more I have to say this. I

:17:53.:17:56.

never wanted to be leader. I did not have the for that. I am pleased that

:17:57.:18:00.

there are people who want to do their job. I do not want to do it

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and I never have done, and I never would've done. Denis Healey felt

:18:07.:18:10.

that he had let the movement down because he did not fight hard enough

:18:11.:18:14.

to beat Michael Foot. You do not feel the same? Dennis had our rate

:18:15.:18:21.

phrase, he felt he was the best predator we never had. Then why the

:18:22.:18:26.

hell was he not party leader? Sometimes people put it to me, but

:18:27.:18:29.

it is my life and I will lead it my way. Thank you.

:18:30.:18:36.

On the Europe subject, the Telegraph tomorrow carries a piece by Chris

:18:37.:18:43.

Grayling who calls for British membership of the EU on current

:18:44.:18:50.

terms disastrous. He also says he supports renegotiation, so maybe

:18:51.:18:53.

staying in the Cabinet rules about what you are or are not allowed to

:18:54.:18:57.

say about the EU at the moment. We should be talking about George

:18:58.:18:58.

Osborne about Europe tomorrow night. Now, you heard Alan Johnson talking

:18:59.:19:02.

about Trident there. A vote is coming up

:19:03.:19:04.

on replacing it this year, Labour is in a strange place -

:19:05.:19:06.

the party policy says yes to replacing Trident,

:19:07.:19:10.

the leader says no to it, and there is a review designed

:19:11.:19:12.

to sort out the gap. It's exactly 30 years

:19:13.:19:15.

since Margaret Thatcher laid the keel for HMS Vanguard,

:19:16.:19:25.

a new generation of Trident In all that time, Jeremy Corbyn has

:19:26.:19:27.

been active in the campaign He is committed to Britain

:19:28.:19:35.

giving up nuclear weapons. I am opposed to the holding

:19:36.:19:40.

and the usage of nuclear weapons. They are an ultimate weapon of mass

:19:41.:19:43.

destruction that can only kill In changing Labour's policy,

:19:44.:19:46.

though, Jeremy Corbyn has two big enemies -

:19:47.:19:52.

time and votes. The only way to change that policy

:19:53.:19:58.

is through a vote at the party's annual conference, but that doesn't

:19:59.:20:11.

happen until the end of September,. Well before that, Parliament

:20:12.:20:13.

could have decided the issue Sources inside the MoD have told me

:20:14.:20:15.

that that maingate vote could come It will certainly happen,

:20:16.:20:23.

I've been told, before Parliament In other words, long before Labour

:20:24.:20:31.

can change its policy officially. John Woodcock is a Labour MP

:20:32.:20:36.

committed to securing Trident's renewal, not least because the four

:20:37.:20:39.

new subs would be built Let's focus on something

:20:40.:20:41.

where we can make a difference for the people who desperately need

:20:42.:20:48.

Labour to be a credible opposition rather than spending time tearing

:20:49.:20:52.

ourselves apart as a party for something which is

:20:53.:20:55.

going to happen anyway. There is a cast-iron majority

:20:56.:21:00.

in Parliament for this project go past the point of no return,

:21:01.:21:03.

so no matter what Jeremy does or even if he were to magic

:21:04.:21:08.

up a changed policy, which he won't, it is not go to make

:21:09.:21:11.

a difference to the fact that these The next problem that Jeremy Corbyn

:21:12.:21:15.

has to deal with is votes. 50% of the votes at conference

:21:16.:21:20.

needed to change the policy come There are reports that

:21:21.:21:28.

Len McCluskey, general secretary of the largest union,

:21:29.:21:32.

Unite, will make a speech this weekend hardening his position

:21:33.:21:35.

against the policy change. If he does that, it will add his

:21:36.:21:37.

voice to that of Paul Kenny If anybody thinks that unions

:21:38.:21:40.

like the GMB are going to go quietly into the night while tens

:21:41.:21:51.

of thousands of our members' jobs are literally swanneed way

:21:52.:21:53.

by rhetoric, then they have got But Jeremy Corbyn says he wants

:21:54.:21:56.

to explore new ways for Labour to make policy, perhaps involving

:21:57.:21:59.

online votes of the party's members. That idea, though, was slapped down

:22:00.:22:02.

pretty emphatically this week by Ian McNicol,

:22:03.:22:04.

Labour's general secretary, Nevertheless, an online vote

:22:05.:22:06.

could be used to put pressure on Labour MPs and even shadow

:22:07.:22:16.

ministers to move in the direction What could also add to the pressure

:22:17.:22:18.

is Labour's defence review, originally to be chaired

:22:19.:22:24.

by Ken Livingstone, who opposes Trident,

:22:25.:22:26.

and the then Shadow Defence Secretary, Maria Eagle,

:22:27.:22:29.

who is in favour. But last week, she was replaced

:22:30.:22:33.

by Emily Thornbury, who also opposes Ken Livingstone told me that they

:22:34.:22:35.

aim to have a recommendation We will desperately try and do it

:22:36.:22:40.

as rapidly as possible, so we will focus on the Trident

:22:41.:22:47.

issue ahead of the rest And that could be done

:22:48.:22:50.

within months, couple of months? With a bit of luck, that could be

:22:51.:22:55.

done in eight to ten weeks, it will take a lot of work for me

:22:56.:23:07.

and Emily, but that's good. The timetable won't reassure some

:23:08.:23:10.

Labour MPs, who suspect that the review has been set up to

:23:11.:23:12.

come to a predetermined conclusion. If you are Venezuela,

:23:13.:23:15.

Saudi Arabia or BP, the year has Something extraordinary has been

:23:16.:23:20.

happening to the oil price - it's been tumbling to levels

:23:21.:23:23.

no-one thought we'd see. Brent Crude dropped below $30

:23:24.:23:26.

a barrel for the first time BP has in fact announced job cuts

:23:27.:23:28.

in its North Sea activities. The Chancellor referred

:23:29.:23:36.

to a cocktail of risks in the world Some think cheap oil

:23:37.:23:38.

is one ingredient, Others think it's going

:23:39.:23:41.

to ameliorate the worst. It's interesting that for all its

:23:42.:24:04.

importance in our lives, we don't very often get to see large amounts

:24:05.:24:21.

of oil, to stand in awe at its power, to smell it. You have to

:24:22.:24:30.

remember the world divides into oil haves and have-nots. The best way to

:24:31.:24:35.

look at the change in price is to think of it is a big hand-out from

:24:36.:24:39.

one group to another. The oil price goes up more I am worse off, Saudi

:24:40.:24:44.

Arabia wins, and when prices go down, as they have, it is the other

:24:45.:24:50.

way round full the oil industry and oil exporting countries have gotten

:24:51.:24:55.

very used to $100 oil, and just assumed that $100 oil was going to

:24:56.:25:00.

be the normal price forever. Wrong assumption! Here is the price of oil

:25:01.:25:05.

in 2015. It is now half what it was last summer. On a longer view, back

:25:06.:25:10.

45 years, you can see the recent swing is one of the big shift of the

:25:11.:25:16.

modern era. Right now, there is simply too much oil. And you can see

:25:17.:25:20.

it if you go to a place like Singapore. I was there recently and

:25:21.:25:24.

you can see all the tankers sitting there doing not much, just simply

:25:25.:25:30.

storing oil. When you have $90 oil, people were combing the world for

:25:31.:25:36.

primary sources of hydrocarbon where there were plenty of different areas

:25:37.:25:39.

which were being developed. And all of them have different financial

:25:40.:25:44.

characteristics, and some of them will not survive at these low prices

:25:45.:25:49.

if they continue, as I expect they will continue.

:25:50.:25:55.

You see, new oil came on tap like US shale. Edward Gold prices, but

:25:56.:26:05.

paradoxically, all that new oil drove prices down, killing its own

:26:06.:26:13.

business model. And that is cause of concern over one. Those that lead or

:26:14.:26:19.

invested find they are kind of where sub-prime lenders were a decade

:26:20.:26:23.

back. We have seen a huge bubble within the oil market in terms of

:26:24.:26:30.

bumps, 18% of bond assurance in the US is oil related. We are now seeing

:26:31.:26:34.

significant problems within that market. I think you have seen a lot

:26:35.:26:39.

of the big operators who have locked in the oil price for most of next

:26:40.:26:45.

year, so they are still at $60 plus when the current spot price is in

:26:46.:26:48.

the 30s, so they haven't run into problems yet. Clearly the issue is

:26:49.:26:53.

if the price remains in the 30s and that locking expires, and you have

:26:54.:26:57.

to sell at the spot rate rather than $60, that is where you see more

:26:58.:27:01.

financial distress. From the oil sector to the problems

:27:02.:27:05.

of the financial sector. There are other grounds for worry, too. You

:27:06.:27:10.

can't separate what is happening with oil prices by themselves from

:27:11.:27:14.

other things that are happening in the world economy. So, to some

:27:15.:27:19.

degree, oil prices today are also a thermometer telling us there is a

:27:20.:27:22.

lot of weakness in the world economy, so we will see a cycle, but

:27:23.:27:27.

right now, the name of the game is survival.

:27:28.:27:35.

# Riding along in my automobile... But forget the losers, who needs

:27:36.:27:39.

losers? There are winners in the oil market, too. Right from the earliest

:27:40.:27:46.

days of our oil fuelled economy, some fundamental rules have applied

:27:47.:27:50.

telling us that cheap oil is good for growth. It is just a vintage

:27:51.:27:53.

economics. As you know, oil powered automobiles

:27:54.:28:02.

have caught on, and we can do a back of the envelope calculation as to

:28:03.:28:07.

the benefit of an oil price cut. So today, we pump something like 20

:28:08.:28:13.

million tonnes, 20 billion litres, of petrol and diesel into our cars.

:28:14.:28:18.

If you cut the price by 15p, that is ?3 billion into the pockets of

:28:19.:28:23.

consumers. Better than a poke in the eye with a sharp stick. And also

:28:24.:28:28.

supports the economy more generally by creating lower energy costs for

:28:29.:28:32.

businesses, that gives more space for investment and for overall

:28:33.:28:35.

employment in the UK. I think the ready reckoner that we had in our

:28:36.:28:40.

mind is when oil prices fell from over $100 back in the summer 18

:28:41.:28:49.

months ago to $50 that that gave a boost to the UK economy of around

:28:50.:28:57.

0.5% to GDP. Oil isn't what it was in the 50s. Al post-industrial

:28:58.:29:00.

economy is less oil intensive than it was. Old ready reckoner is may

:29:01.:29:06.

have weakened. But all in all, while there is a lot to worry about at the

:29:07.:29:13.

moment, cheap oil probably gets two Cheers. Two, not three.

:29:14.:29:19.

Just worry about nations that are so dependent on revenues from oil that

:29:20.:29:24.

there may be some unexpected instability. And it usually is

:29:25.:29:28.

unexpected. So it is not all good news, but on

:29:29.:29:32.

balance, I would say it is good news for the consumer, not so good news

:29:33.:29:36.

if you are in the oil and gas business.

:29:37.:29:38.

And I should say thank you to the Brooklands Museum

:29:39.:29:41.

in Weybridge for the loan of that old Ford motor and the use

:29:42.:29:44.

That was a very evenhanded account of it.

:29:45.:29:50.

Joining me now are Sir Alan Duncan, Conservative MP and former Minister

:29:51.:29:53.

for International Development, and Gillian Tett, US Managing Editor

:29:54.:29:56.

Good evening to you both. You can see at glass half full is empty.

:29:57.:30:07.

Which is it? You will sound like a classic Scrooge if you say it is

:30:08.:30:11.

half ten T. The reality is it is great for consumers driving cars,

:30:12.:30:14.

but if this oil price fall has occurred just across the cars were

:30:15.:30:17.

becoming so efficient they didn't need oil so much any more, because

:30:18.:30:21.

suddenly people have found a whole lot more oil, that would be good.

:30:22.:30:26.

The problem is that this oil price fall is partly because of sheer

:30:27.:30:29.

political tension and rivalry between Saudi Arabia and the US, but

:30:30.:30:32.

also because demand is falling in places like China, and that is

:30:33.:30:42.

worrying. And you say that it is to do with the geopolitical thinking?

:30:43.:30:48.

It does appear that one factor driving policy is the fact that Opec

:30:49.:30:53.

has been unravelling, but also that some Saudi leaders are trying to

:30:54.:30:58.

undermine the US shale industry. But it is extraordinary. Yes, we are

:30:59.:31:07.

back to $30 oil, which is where I came in water years ago. The issue

:31:08.:31:13.

is this. We all love low prices at the pump. But what we have seen over

:31:14.:31:18.

the last year is extraordinary volatility, and that volatility,

:31:19.:31:21.

going down from over 100 to about 30 unleashes massive forces when money

:31:22.:31:25.

moves across the globe and has consequences, and I think the sort

:31:26.:31:29.

of consequences we can see at the immediate effects of the oil

:31:30.:31:33.

services sector losing jobs, and of course the North Sea is suffering,

:31:34.:31:38.

and that will hurt us as the UK. We are seeing a lot of oil producing

:31:39.:31:43.

countries needing some thing like $80 oil to pay their way, so if they

:31:44.:31:47.

have financial deficits, they will have to Saky no enormous amount of

:31:48.:31:51.

money by liquidating assets or borrowing, and you then end up with

:31:52.:31:53.

a liquidity squeeze which could but up interest rates, and so we will

:31:54.:31:59.

also, as Julian Cuesta rightly says, look we looking at geopolitical

:32:00.:32:01.

pressures in oil producing countries. These are massive forces.

:32:02.:32:08.

If there was ever a moment you don't want geopolitical pressures, it is

:32:09.:32:13.

right now. We have a story at the FT saying that BP is slashing jobs,

:32:14.:32:18.

4000 jobs, a big hit on North Sea oil, all these kinds of jobs. You

:32:19.:32:22.

are seeing a number of emerging market and countries which are big

:32:23.:32:26.

oil producers having a squeeze right now which frankly the world doesn't

:32:27.:32:30.

need in terms of instability. It is right to think essentially if

:32:31.:32:33.

you are involved in oil, this is clearly awful. Should people who are

:32:34.:32:39.

not involved in oil, who don't own BP and don't work in the oil

:32:40.:32:43.

industry, but you can buy petrol at ?1 per litre, should they, it you

:32:44.:32:53.

called it potentially catastrophic in the Commons today, and you ask

:32:54.:32:58.

the question of the Prime Minister on it. Is it simply a problem for

:32:59.:33:03.

people in the oil industry? No, it isn't, because there is a volatility

:33:04.:33:08.

and instability. There is global instability politically in the

:33:09.:33:13.

Middle East, but you put that to one side, if you are a pensioner, it is

:33:14.:33:17.

impossible to exaggerate the number of pension funds that rely heavily

:33:18.:33:29.

on'S dividends -- rely heavily on the shell's dividends for their

:33:30.:33:34.

pension pot. I want people to be able to fill their back after less

:33:35.:33:38.

than ?1 per litre, but other things with that good news. I wouldn't be

:33:39.:33:42.

quite so gloomy. Other studies have been done in the US which are

:33:43.:33:50.

countries that are far more dependent on petrol than the UK, and

:33:51.:33:54.

they were saying families are saving $700 per year. And that is good. But

:33:55.:33:58.

the interesting thing is, when you look at whether on not the consumer

:33:59.:34:02.

is spending that windfall, it looks like only about half of it is being

:34:03.:34:05.

spent, because people are still pretty scarred by the whole 2008

:34:06.:34:10.

financial crisis, so if you look at the overall economic boost, you are

:34:11.:34:14.

probably not going to see the simple sums, what they suggest. Suppose we

:34:15.:34:19.

found a big hole in the North Pole, and out of it just came as much oil

:34:20.:34:22.

as we possibly needed, put aside concerns about the planet, because

:34:23.:34:28.

we haven't talked about those. If we could all have free oil in unlimited

:34:29.:34:31.

quantities, would you tell me that is bad news that the economics of

:34:32.:34:35.

the world, or would you say, thank goodness, we don't have to worry

:34:36.:34:39.

about energy any more. It is a wonderful hypothetical question. In

:34:40.:34:43.

the long-term, cheap energy is a good thing, although in terms of

:34:44.:34:52.

green... Let's say it's green oil! It would dramatically change in

:34:53.:34:57.

historic ways the balance of power, wealth and everything else across

:34:58.:35:00.

the world. It would be the end of the Middle East in terms of their

:35:01.:35:03.

wealth, of course. You can write a book about this, I am sure. It would

:35:04.:35:10.

be a big deal, anyway. Thank you both very much. Sorry, we have to

:35:11.:35:11.

leave it there. Oil is not the only sector that's

:35:12.:35:14.

been having a hard time. Hotels have been complaining

:35:15.:35:17.

that they face unfair competition It's the web service that allows

:35:18.:35:19.

ordinary people to take on Holiday Inn by renting

:35:20.:35:23.

out their spare rooms to strangers. Or in some cases, as the hotels

:35:24.:35:26.

point out, their spare What's clear is that

:35:27.:35:30.

Airbnb is catching on. After hosting hundreds of guests, I

:35:31.:35:44.

realised how I am connected to these different people who belong from

:35:45.:35:47.

different cultures, different countries and different backgrounds.

:35:48.:35:52.

Being an Airbnb host is being part of a global community. It gave me a

:35:53.:35:58.

faith in humanity, to be honest. They come as guests but they leave

:35:59.:36:02.

as friends. That experience is much more enriching. Imagine today that

:36:03.:36:07.

it is possible for all of us to experience that.

:36:08.:36:09.

Now hotels say it's unfair competiion.

:36:10.:36:10.

They meet certain pernickety rules and regulations -

:36:11.:36:12.

like paying tax - that not all their rivals necessarily feel

:36:13.:36:15.

Today the RSA, the Royal Society of the Arts, published a report

:36:16.:36:19.

arguing that platforms like Airbnb help us take advantage

:36:20.:36:21.

of our underused resources and they extend access.

:36:22.:36:26.

We asked Airbnb to join us, but they are busy tonight.

:36:27.:36:31.

But with me is author of that report, Brhmie Balaram,

:36:32.:36:34.

and from the British Hospitality Association,

:36:35.:36:35.

Good evening. Brhmie Balaram, Tony Abbott about the sharing economy and

:36:36.:36:49.

why you are an enthusiastic that? The report today said that the

:36:50.:36:52.

sharing economy is the beginning of a power shift to the people, and

:36:53.:36:58.

there are now 23 million users in the UK, 80 million users in the US.

:36:59.:37:02.

And this is on the rise. I think it is because rather than depending on

:37:03.:37:06.

big business, people would rather provide what they need and want

:37:07.:37:09.

themselves and do it with each other, so they are beginning to

:37:10.:37:12.

share with each other and there is a lot of social and environmental

:37:13.:37:18.

benefits being realised. It is a lot of areas, where people do not like

:37:19.:37:21.

being disrupted by upstarts coming in online. How do the hotels feel?

:37:22.:37:29.

On one hand, we think it is worthwhile that families are allowed

:37:30.:37:34.

to rent out room or even an entire floor was in their homes to guests.

:37:35.:37:38.

That is a valuable additional offer to tourists. There is a lot to be

:37:39.:37:43.

said for that but on the other hand, we are seeing 47%, almost half of

:37:44.:37:47.

the properties listed in London, professional landlords. So in a

:37:48.:37:54.

sense they are pseudo- hotels, hotels in everything but name. And

:37:55.:38:02.

that leads to some... There are a lot of things wrong with that. These

:38:03.:38:07.

establishments can jump through planning hoops. Planning regulation

:38:08.:38:11.

is there to ensure that housing supply is not restricted. If you

:38:12.:38:16.

restrict housing supply, and this is a lot of users we are talking about,

:38:17.:38:22.

a lot of volume, and 50% of this volume is a professional landlords,

:38:23.:38:25.

that is putting a lot of pressure on rents and inflating property prices,

:38:26.:38:30.

restricting housing in areas like London where housing is a problem.

:38:31.:38:33.

It is noble for you to be worried about housing in London but you are

:38:34.:38:37.

really worried about competition with hotels, fundamentally. The

:38:38.:38:40.

problem with hotels, competition is secondary to the social costs.

:38:41.:38:47.

Reputation is a big issue for us. The establishments, these

:38:48.:38:49.

professional landlords do not have to comply with health and safety

:38:50.:38:53.

regulation, they are not complying with food safety regulation. If

:38:54.:38:56.

something goes wrong, and I would not like us to wait for that, for

:38:57.:39:02.

there to be a terrible fire, 72% of fires in the UK are in homes, these

:39:03.:39:05.

things are readily did and monitored in hotels. If something goes wrong,

:39:06.:39:11.

the reputation will be damaged. I wonder, is there a gap between the

:39:12.:39:17.

way we treat the official sector, the hotels and B who go through

:39:18.:39:21.

planning permission, and the likes of you and I who can rent out a

:39:22.:39:26.

room? Is that a discrepancy we should resolve? I think it is

:39:27.:39:29.

already being resolved. I would urge people to think about what is

:39:30.:39:31.

happening in the states where the debate has been raging for some

:39:32.:39:37.

time. We are seeing the emergence of third-party support for these sorts

:39:38.:39:42.

of platforms. For example, there is an organisation in the US that

:39:43.:39:47.

provides insurance to users on the sharing economy platforms. That sort

:39:48.:39:50.

of invasion has not happened here yet. If I asked them, if I said to

:39:51.:39:57.

them, why not give all the data of how much your participants are

:39:58.:40:03.

earning, and pass that to the Treasury, so we can make sure

:40:04.:40:08.

everyone is paying tax on it, like I intend to make sure the hotels do,

:40:09.:40:12.

what would be wrong of seeing that was a requirement? I think that is a

:40:13.:40:19.

violation of privacy for these users. I think Airbnb has been quite

:40:20.:40:26.

straightforward. Recently, in the US, they created... Why should it be

:40:27.:40:31.

so secret? If anyone... Everyone is playing by the rules, then why not?

:40:32.:40:36.

They are business and they're trying to do what is in the best interest

:40:37.:40:41.

of the users. There is a mass movement of hosts, advocating to be

:40:42.:40:45.

part of everything, they like to participate in this sort of

:40:46.:40:50.

exchange. To finish, Ufi Ibrihim, in terms of the effect on hotels, how

:40:51.:40:56.

big an effect is this having? Probably Airbnb is bringing in more

:40:57.:40:59.

customers rather than stealing business? On one hand, it is a good

:41:00.:41:02.

thing but where we have professional landlords operating these hotels and

:41:03.:41:06.

not paying taxes, the sharing economy has created a hidden

:41:07.:41:10.

economy, which is unfortunate for UK plc. And the public safety issue, as

:41:11.:41:16.

well as the issue... But how big a deal is at? 10% of the hotels'

:41:17.:41:20.

business? Very difficult to tell at the moment because we have very

:41:21.:41:26.

little data. Everything is hidden by the sharing economy. Thank you both

:41:27.:41:27.

very much. But we learned today that,

:41:28.:41:27.

embarrassed by public pressure from the Chinese dissident artist

:41:28.:41:31.

Ai Weiwei, Lego ended their policy of refusing to bulk sell

:41:32.:41:36.

their product in cases where the end So, in the interests of balance,

:41:37.:41:39.

we leave you with the the work of cult YouTube animator Dino5500,

:41:40.:41:45.

whose rather disturbing Lego remembrance of the Battle

:41:46.:41:50.

of Stalingrad slightly suggests the company's sensitivities might

:41:51.:41:52.

sometimes be well-founded.

:41:53.:41:55.

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