Turkey and the flight ban
As you all been following the recent events in Turkey, I will not go into those details but I completely support a complete ban on all civilian air transit through Turkish airspace pending a resolution of the crisis.
A nation which cannot maintain the security of the airspace over its capital territory cannot possibly claim to be able to secure its civilian air corridors.
A nation where a military flight can take off with live munitions without the proper release papers being signed and then proceed to penetrate protected airspace and attack major national infrastructure is in no shape to honor its commitments to global aviation security.
Some view the FAA position on Turkey as extreme. I do not.
I feel they did the right thing, and it should have been done even faster.
At the instant there was sign of a coup an immediate ground stop should have gone into effect and all flights transiting Turkish airspace should have landed or redirected.
I feel the ban should remain in effect until external observers from various security agencies consistently report that all Surface to Air and Air to Air weapons systems are being correctly managed by Turkish military personnel.
Doing anything else simply invites another MH-17 type disaster.
There are three main sources of transit revenue in Turkey
1) NATO money for military transit and hosting.
2) Kurdish drug revenue going West.
3) ONG revenue (some from Baku-Tblisi -Ceyhan and some from ISIS-oil).
My guess is that with the fall of the ISIS Caliphate - the revenue stream there has come under pressure and that is the fissure we are seeing right now.
This is way deeper than anything we are seeing anywhere.
This is way off the charts compared to the situation in France.
We are watching a modern secular democratic state critical to global security come apart at the seams.
The misconceptions of Brexiters.
A lot has been said already - but since we now live in the age of consequences - it is best to repeat exactly how flawed these conceptions are.
1)
"Britain stood alone before and can do it again" - No - Britain was never "alone" and can't "do" anything "again".
Britain in its economic heyday as an empire and as a commonwealth always had an economic partner. Britain's per capita GDP only began to rise after the Crown seized land in the Americas in the 1700s. After the US became independent, the British economy was held aloft by its trade relationship with India. The entire age and glory of the British Empire came from Britain's ability to rape India's resources and shore up its own capital base.
Post WWII Britain emerged as the only economy in Europe that still had buildings standing. Everyone else had to build nations out of rubble. The Brits profited intensely by essentially acting as the middleman in the loans written out from the US to the European nations. For every dollar invested in the Marshall plan, the Brits pocketed a few cents as transaction fees. This allowed them to rebuild their nation even after the Empire was lost. Post WWII prosperity exists in Britain today only because of its trade relationship with the EU.
"Alone" Britain is simply a tiny island with no real connection to the global economy. Masturbating to a fantastic history is okay in principle - it makes for a great night in the pub - but it is exceedingly stupid to vote on those grounds.
I used to think that only Indians are stupid enough to vote on nostalgia of a mythical Hindu utopia, but I guess Brits are no better.
2)
"Who doesn't want to trade with us?" - Actually everyone doesn't want to trade with you that is why the Pound is falling.
There is very little that is actually produced in Britain today. What little is produced is consumed locally this generates very little revenue. The mainstay of British revenue generation is a kind of transit trade. Goods and services flow via Britain to various European markets in exchange for debt instruments that are passed back and forth between the producer nations, Britain and EU consumers. Most of Britian's economic weight is owed to its ability to charge a premium on this peculiar transit trade.
By going off on a limb like this the Brits have screwed themselves out of a stable pattern of transit trade. It is akin to the Pakistanis suddenly deciding that they don't want to be a transit route for Afghan opium. The total revenue generated from the Heroin transit trade in Pakistan is estimated to be the size of the Pakistani GDP. If Pakistan decide it wasn't going to be a willing partner in this trade anymore - the entire economy would collapse. This is also true for Britain.
A simple way to understand this is that cash flow from every loan ever taken by someone in Britain is linked intimately a particular transit trade item. If you shut down the transit trade, capital/debt transactions will become completely disconnected.
3)
"It can't get worse" - No my friend - it can and it will get worse. Thanks to this recent bout of stupidity, any trade flow across Britain becomes more risky which means there will be more hidden fees that all Britons will have to shell out to get people to come trade with them. If Britain was rich like it once was during the colonial period, it would offload this new debt on to one of its colonies. That sort of thing would create a famine out there but the Brits would be fine. But today - Britain has no such offloading capability. If Britain has to come up with extra trade fees, then it will have to generate that revenue internally - basically by shutting down parts of the NHS. That will make matters quite a bit worse for all Britons.
4)
"Europe is Bluffing" - Err.. No. Take a good look at Eastern Europe. Take a good look at port traffic patterns in the ports of Naples and Rotterdam. Look at how many ships from China are directly docking there. Now look at the same data for the ports in the UK. Compare the numbers and you will see Europe doesn't really need Britain as a transit point. The whole reason WWI and WWII occurred was that Britain "ruled the seas" and it could prevent European economies from accessing resources in their colonies. That is hardly the case today.
5)
"Look its just neighbors hav'ing a tiff" - Yeah - the last time that sort of thing went down - nothing bad every happened. (end Sarc).
Brexit: Some Observations and Comments
I am not certain what impact Brexit will have on the global economy and the people that voted for it. I am reasonably certain that that as Guharpal Singh points out - this is an event on the scale of India's independence - a tectonic shift in political terms.
I see that a lot of Indian observers are taking cheap shots at the Brits. That is only natural. After being accused of being a bunch of congential fuckups by the Brit counterparts - the Indians are finally getting a chance to return the favor.
Based on the manner in which opportunistic politicians are exiting the Leave campaign, I am guessing the foreseeable future will be quite painful for the voters. Opportunistic politicians are inherently bottom feeders, when there is nothing to feed on - they will leave.
A lot of Brits are feeling regret over their vote - but as others have pointed out - there is no do-over on this. Conducting the referendum again will not annul the effects of the Brexit drama. It will only make matters worse as it will paint the British leadership as being even more feckless than it currently appears.
The only way out of this mess is to annul the results of the referendum because they are somehow fraudulent and unrepresentative of public sentiment. There certainly are clear allegations of misconduct and fraudulent behavior by Leave campaigners. They made promises they had no intention of keeping. The assassination of Jo Cox certainly points to a campaign of violence being initiated by fringe elements of the Leave campaign, but there is nothing available to suggest that Leave campaigners physically interfered with the voters themselves or their ability to physically cast their votes. Absent clear evidence that the Leave campaign actually tampered with the
physical electoral process during the referendum, there is no cause at the present time to doubt the veracity of the results.
Basically - whatever suffering results from Brexit - the people that voted have only themselves to blame for this. I guess this should serve as a warning to people who vote without knowing what they actually are voting for. If you are so stupid that you don't bother to read up on the issues before you go off and press the button, you deserve every bit of what is coming to you.
As regards the rest of the world suffering from Brexit, it is very sad, but that is the way it is. The world is more interconnected than we realize and when even on segment of the populations . A majority of the suffering is financial, it mainly a consequences of several major financial arteries being routed via London after WWII. These arteries are the real life-blood of the British economy.
When WWII ended, Europe lay in ruins only Britain had any buildings left standing. That is why the financial network that supported American investment in Post-War Europe (via the Marshall Plan) was routed through London. One might visualize this network as a series of wires connecting banks in the US to banks in continental Europe. Debt in various forms is transmitted back and forth over these wires and the US economy is physically tied to European economies. As debt moves back and forth on these "wires" - wealth in the form of goods and services flows back and forth over national borders. A part of that flow of goods and services is the flow of labor between these countries. You might say that the paper flow of capital or debt is collaterized or ballasted with the flows of goods, services and labor.
Every time a correlated flow of debt and goods/services/labor occurs along these wires, two things happen simultaneously. Firstly wealth is carefully trickled into Swiss bank accounts and a small (almost imperceptible) improvement in the British quality of life occurs. It is this small improvement that has allowed Britain to rebuild itself after WWII and collapse of the empire. The unusual leverage that Britian uses to "punch above its status" is mainly the result of it exploiting the benefits of this peculiar Post-War cash flow pattern.
The Brexit drama should have been a case of political theatre, like a Pakistani General negotiation with a gun to his own head - but instead the actors lost control of the scene and the very financial channels that keep the British economy funded in the first place are in danger of being relocated. This relocation will take time but once the process starts it will be irreversible.
If Britain actually carries through on the referendum and activates Article 50. It is likely that Northern Ireland and Scotland will follow. In terms of nuclear security implications, HMNB at Clyde will have to be relocated or an arrangement similar to what the Russians reached with Ukraine over the use of Sevastapol will have to be reached between England+Wales, and independent Scotland. If such an agreement cannot be reached, the Scotland will retain ownership of the nuclear submarines and any warheads therein. The United Kingdom will no longer be a part of the P5 or the established nuclear weapons states - Scotland will end up taking their place on the table.
