We focus this month on money. First, the real direct costs of the Iraq and Afghan wars. The figures have soared without a whisper of apology, but rather with every effort to conceal. We see where the money has come from and what it means for our future. We dig into the relative strengths of gold and paper currency. Should we be buying ingots?

We take a hard look at inflation run wild, the Zimbabwe experience, what happens when all restraint is cast aside. And we blush at the contempt in which elected politicians hold their constituents. We know best, is their approach. A quick look at Russia’s new economic clout rounds out the money side of April, but we also see how three different newspapers present the same story. Their reporters might have been on different planets?

Contact us with your comments, articles and queries.

General

Feel life is passing you by? Activities with fellow Mensans will turn this around. Think coffees, martinis, movies, dinners, quizzes, anything that ravels up the tired sleeve of care. We’re informal and unstructured, on occasion intellectually stimulating. Mensa Calgary is a community where members interact, network, support each other, and enjoy each other’s company. For further info, contact Patricia at kathleen4057@yahoo.ca ["There's no pleasure on earth that's worth sacrificing for the sake of an extra five years in the geriatric ward of the Sunset Old People's Home." (John Mortimore)]

MensaTest

The April date was not selected as at our going to press. Contact Vicki Herd for further info: vherd@shaw.ca

MensaGenerationXX

The youth group awaits a new style and guru.

CoffeeFests

Diverting discussion at The Purple Perk, 2212 – 4th St SW, 7:00pm, Thursdays April 10 and 17. No subject too hot, no view too contentious, no humour too sublime. Confirm with Patricia at kathleen4057@yahoo.ca

DinnerNight

Thursday, April 3, 2008 @ 6:30 pm. The location: Bonterra, 1016 – 8th St SW. RSVP Patricia (kathleen4057@yahoo.ca).

BookClub

April 24th at 7pm. The book will be Haruki Murakami’s The Wind-Up Bird Chronicle, host Michael Broadbent at the Hop In Brew Pub, 213 12th Ave SW (the yellow house). Mensa bookclub selections have included The Alchemist, Water for Elephants, A Thousand Splendid Suns and Late Nights on Air. Contact Patricia at kathleen4057@yahoo.ca or 212-1461.

SecondTuesdays(of the Month)

A monthly coffee and conversation evening chez Vicki Herd, 2469 Sorrel Mews SW (a couple of blocks south of 33 Ave, east of Crowchild Tr), 7:30pm. BYOB.

Trips

Jeff Pugh, a local Mensan, is planning a few outings in May/June and has a wealth of information about the sites mentioned here. Email Patrica at almostp@shaw.ca if you’re interested. With enough warm bodies, we can rent a van and travel together. The first trip will be May 19th. Here are some options:

Trip A:

Ellis Bird Farm

Stroll the extensive trails, enjoy beautiful gardens, see the world’s largest outdoor collection of bluebird nestboxes, inspect the visitor centre and linger in the Tea House.
(http://www.ellisbirdfarm.ab.ca/)

Dry Island Buffalo Jump

Dry Island Buffalo Jump Provincial Park is a natural reserve of forest, canyon and mesas carpeted in buffalo grass, the original covering of the great plains. Across the open prairie, the first glimpse of the Red Deer River Valley and its badlands comes as a shock when the ridge of the canyon drops 200 meters to the river. The location combines Canada’s most extensive dinosaur fossil fields and one of the most dramatic bison jump sites in Alberta.

Trip B:

The Big Rock

This is the world’s largest glacial erratic, ie a rock transported from its place of origin by glacial ice. Weighing in at 16,500 tons, the BR measures 9 metres high, 41 long and 18 wide. Also known as the Okotoks Erratic, BR is the largest of the Foothills Erratics Train, a group of rocks carried by ice along the mountain front and dropped as the glacier melted some 10,000 years ago. The group lies in a narrow band from Jasper National Park to northern Montana.

Big Hill Springs

Big Hill Springs is located northwest of Calgary in the foothills of the Rocky Mountains. The main attraction is a series of small waterfalls that flow year-round over rocky terraces covered with lush shrubs and grasses. The park is also the site of an historic fish hatchery and Alberta’s first commercial creamery.

Morley Flats

Another curious glacier landform is the drumlin. The best place to see drumlins is Morley Flats, 42 km west of Calgary on the Trans-Canada Highway. Debate continues as to whether these asymmetrical mounds form by deposition or erosion . Whatever the mechanism, it is accepted that drumlins indicate the ice-flow direction: the steep ends pointing upstream and the gentle, tapered ends downstream.

Trip C:

Johnston Canyon and the Ink Pots, Banff National Park

This area shows the power of nature and time; rushing water has carved a path through the limestone canyon, and potholes have formed from plunging waterfalls. This is one of the most popular hikes in Banff National Park. The walk involves only a mild to moderate rise along a whole series of waterfalls. Drive 20 kilometers west of Banff to the self-guided interpretive trail up the canyon. The effects of rapid erosion are spectacular and the reasons for it are explained clearly. If you travel to the end of the trail, 5.5 kilometers, you find the ‘Ink Pots’ where 6 cool springs bubble out of the ground year round. Glacial sediments cause the beautiful aqua colors. Bring lots of film.

For general queries email Vicki Herd (vherd@shaw.ca).

1) An evil sorcerer has placed three boxes of treasure and a beautiful princess in a magic castle. The princess will sleep until a prince arrives who can guess the contents of the three boxes. Box 1 is labeled diamonds, box 2 rubies, and box 3 diamonds and rubies. One box contains only diamonds, another rubies and the third both, but the sorcerer has lied in his labels. The prince is granted the power to open one of the three boxes and extract one object from it. How can the prince reason to determine what is in each box, and thereby save the princess?

2) What eight-letter word contains only one vowel?

3) You have a balance scale, but the economic crisis has depleted your ability to buy weights for it. What is the least number of weights that will permit you to weigh any number of grams from one through 40, and what are those weights?

AnswersToMarchQuiz: 1) The cube of the numbers starting with one. 2) 33,550,336. This is the series of perfect numbers, those whose divisors add up to the number itself. The next one after is 8,589,869,056. 3) Starting with a billion, add one to the Latin root of the number and multiply by three to find the number of zeros. Thus "bi" is the root for two; add one, which gives three. Multiply by three, which gives the number of zeros in a billion, namely nine. Find the names by the reverse process.

A googol is ten to the power of a hundred. Skewes’ number (related to primes) is ten to the power of ten to the power of ten to the power of 34. To place this in perspective, our hearts beat only a billion times in 26.5 years, and 5.7 times ten to the power of 35 hydrogen atoms would reach across the universe.

4) One; one one; two ones; one two and one one; one one, one two, two ones; three ones, two twos, one one; one three, one one, two twos, two ones.

The Bush Administration was wrong about the benefits of the Iraq and Afghan wars and it was wrong about the costs. The president and his advisers expected a quick, inexpensive conflict. Instead, we have wars that are costing more than anyone could have imagined.

The cost of direct US military operations – not even including long-term costs such as taking care of wounded veterans – already exceeds the cost of the 12-year war in Vietnam and is more than double the cost of the Korean War.

And, even in the best case scenario, these costs are projected to be almost ten times the cost of the first Gulf War, almost a third more than the cost of the Vietnam War, and twice that of the First World War. The only war in US history which cost more was the Second World War, when 16.3 million US troops fought in a campaign lasting four years, at a total cost (in 2007 dollars, after adjusting for inflation) of about $5 trillion (that’s $5 million million, or £2.5 million million). With virtually the entire armed forces committed to fighting the Germans and Japanese, the cost per troop (in today’s dollars) was less than $100,000 in 2007 dollars. By contrast, the Iraq war is costing upward of $400,000 per troop.

Most Americans have yet to feel these costs. The price in blood has been paid by the voluntary military and by hired contractors. The price in treasure has, in a sense, been financed entirely by borrowing. Taxes have not been raised to pay for it – in fact, taxes on the rich have actually fallen. Deficit spending gives the illusion that the laws of economics can be repealed, that we can have both guns and butter. But of course the laws are not repealed. The costs of the war are real even if they have been deferred, possibly to another generation.

On the eve of war, there were discussions of the likely costs. Larry Lindsey, President Bush’s economic adviser and head of the National Economic Council, suggested that they might reach $200 billion. But this estimate was dismissed as "baloney" by the Defence Secretary, Donald Rumsfeld. His deputy, Paul Wolfowitz, suggested that postwar reconstruction could pay for itself through increased oil revenues. Mitch Daniels, the Office of Management and Budget director, and Secretary Rumsfeld estimated the costs in the range of $50 to $60 billion, a portion of which they believed would be financed by other countries. (Adjusting for inflation, in 2007 dollars, they were projecting costs of between $57 and $69 billion.) The tone of the entire administration was cavalier, as if the sums involved were minimal.

Even Lindsey, after noting that the war could cost $200 billion, went on to say: "The successful prosecution of the war would be good for the economy." In retrospect, Lindsey grossly underestimated both the costs of the war itself and the costs to the economy. Assuming that Congress approves the rest of the $200 billion war supplemental requested for fiscal year 2008, as this book goes to press Congress will have appropriated a total of over $845 billion for military operations, reconstruction, embassy costs, enhanced security at US bases, and foreign aid programmes in Iraq and Afghanistan.

As the fifth year of the war draws to a close, operating costs (spending on the war itself, what you might call "running expenses") for 2008 are projected to exceed $12.5 billion a month for Iraq alone, up from $4.4 billion in 2003, and with Afghanistan the total is $16 billion a month. Sixteen billion dollars is equal to the annual budget of the United Nations, or of all but 13 of the US states. Even so, it does not include the $500 billion we already spend per year on the regular expenses of the Defence Department. Nor does it include other hidden expenditures, such as intelligence gathering, or funds mixed in with the budgets of other departments.

Because there are so many costs that the Administration does not count, the total cost of the war is higher than the official number. For example, government officials frequently talk about the lives of our soldiers as priceless. But from a cost perspective, these "priceless" lives show up on the Pentagon ledger simply as $500,000 – the amount paid out to survivors in death benefits and life insurance. After the war began, these were increased from $12,240 to $100,000 (death benefit) and from $250,000 to $400,000 (life insurance). Even these increased amounts are a fraction of what the survivors might have received had these individuals lost their lives in a senseless automobile accident. In areas such as health and safety regulation, the US Government values a life of a young man at the peak of his future earnings capacity in excess of $7 million – far greater than the amount that the military pays in death benefits. Using this figure, the cost of the nearly 4,000 American troops killed in Iraq adds up to some $28 billion.

The costs to society are obviously far larger than the numbers that show up on the government’s budget. Another example of hidden costs is the understating of US military casualties. The Defence Department’s casualty statistics focus on casualties that result from hostile (combat) action – as determined by the military. Yet if a soldier is injured or dies in a night-time vehicle accident, this is officially dubbed "non combat related" – even though it may be too unsafe for soldiers to travel during daytime.

In fact, the Pentagon keeps two sets of books. The first is the official casualty list posted on the DOD website. The second, hard-to-find, set of data is available only on a different website and can be obtained under the Freedom of Information Act. This data shows that the total number of soldiers who have been wounded, injured, or suffered from disease is double the number wounded in combat. Some will argue that a percentage of these non-combat injuries might have happened even if the soldiers were not in Iraq. Our new research shows that the majority of these injuries and illnesses can be tied directly to service in the war.

From the unhealthy brew of emergency funding, multiple sets of books, and chronic underestimates of the resources required to prosecute the war, we have attempted to identify how much we have been spending – and how much we will, in the end, likely have to spend. The figure we arrive at is more than $3 trillion. Our calculations are based on conservative assumptions. They are conceptually simple, even if occasionally technically complicated. A $3 trillion figure for the total cost strikes us as judicious, and probably errs on the low side. Needless to say, this number represents the cost only to the United States. It does not reflect the enormous cost to the rest of the world, or to Iraq.

From the beginning, the United Kingdom has played a pivotal role – strategic, military, and political – in the Iraq conflict. Militarily, the UK contributed 46,000 troops, 10 per cent of the total. Unsurprisingly, then, the British experience in Iraq has paralleled that of America: rising casualties, increasing operating costs, poor transparency over where the money is going, overstretched military resources, and scandals over the squalid conditions and inadequate medical care for some severely wounded veterans.

Before the war, Gordon Brown set aside £1 billion for war spending. As of late 2007, the UK had spent an estimated £7 billion in direct operating expenditures in Iraq and Afghanistan (76 per cent of it in Iraq). This includes money from a supplemental "special reserve", plus additional spending from the Ministry of Defence.

The special reserve comes on top of the UK’s regular defence budget. The British system is particularly opaque: funds from the special reserve are "drawn down" by the Ministry of Defence when required, without specific approval by Parliament. As a result, British citizens have little clarity about how much is actually being spent.

In addition, the social costs in the UK are similar to those in the US – families who leave jobs to care for wounded soldiers, and diminished quality of life for those thousands left with disabilities.

By the same token, there are macroeconomic costs to the UK as there have been to America, though the long-term costs may be less, for two reasons. First, Britain did not have the same policy of fiscal profligacy; and second, until 2005, the United Kingdom was a net oil exporter.

We have assumed that British forces in Iraq are reduced to 2,500 this year and remain at that level until 2010. We expect that British forces in Afghanistan will increase slightly, from 7,000 to 8,000 in 2008, and remain stable for three years. The House of Commons Defence Committee has recently found that despite the cut in troop levels, Iraq war costs will increase by 2 per cent this year and personnel costs will decrease by only 5 per cent. Meanwhile, the cost of military operations in Afghanistan is due to rise by 39 per cent. The estimates in our model may be significantly too low if these patterns continue.

Based on assumptions set out in our book, the budgetary cost to the UK of the wars in Iraq and Afghanistan through 2010 will total more than £18 billion. If we include the social costs, the total impact on the UK will exceed £20 billion.

(by joseph stiglitz and linda bilmes. The Times, February 23, 2008, extracted from The Three Trillion Dollar War, published by Allen Lane on February 28)

In the early 1950s I was reading history at Balliol College, Oxford. I learnt a good deal from my tutors, whom I remember with gratitude, but even more from my contemporaries, such as Dick Taverne or Bernard Williams, the philosopher. There was, even then, no doubt who was the most erudite undergraduate, with, as it seemed, total recall of the whole corpus of European literature. It was George Steiner, the polymath whose encyclopaedic learning has been creating envy in academic circles ever since.

In the mid-1960s, I was visiting New York and met George’s father, a quiet Jewish banker, who, like the great Siegmund Warburg, had been trained in the tradition of European banking of the pre-Nazi era.

He had already reached Paris when George was born in 1929. George once told me that he had been brought into the world by an American obstetrician, who later achieved fame by shooting the American populist, Huey Long, in the atrium of the Louisiana State Capital in Baton Rouge. Neither Governor Long nor the obstetrician survived.

Dr Steiner, like most good European bankers of his generation, believed in gold as the ultimate reality of the world’s financial system. He told me of Franklin Roosevelt’s arbitrary decision to fix the dollar price for gold at $35 an ounce, at which the official price then still stood. Dr Steiner also observed that the free market for gold, which some people still regarded as a "black market", was at a premium to the official price. He forecast that the official price would come into line with the free market eventually.

His forecast was proved correct in 1971, when President Nixon, who had no real idea what he was doing, brought dollar convertibility into gold to an end. The gold price rose from $35 an ounce to more than $800 in the next decade.

I have been interested in the story of gold ever since. Victorian economists, writing in the period of the gold standard, used to define the functions of money. Two of these classic functions were money as a "medium of exchange" and money as a "store of value".

As a medium of exchange, money needs to have convertibility and liquidity. Paper currencies have these qualities, so does gold. To add to the store of value, money needs to retain its value over long periods.

Gold has retained its value, though with fluctuations, over centuries. Even now its purchasing power in terms of physical assets is not far distant from 300 years ago, before Isaac Newton’s recoinage of 1717. Most paper currencies lost more
than 98 per cent of their purchasing power in the 20th century alone.

My conversation with Dr Steiner was a prelude to a friendship with Professor Roy Jastram, whose book, The Golden Constant, proves statistically the long-term stability of the purchasing power of gold. I have also written or edited two books on the case for gold myself. For some years I have been forecasting that gold would rise in price to $1,000 an ounce. Last week it reached $950 an ounce. We are getting very close. I also forecast that oil would go to $100 a barrel; it has.

Why is this process happening? What does it tell us? This is happening because the world has been losing confidence in all the currencies issued by central banks, but particularly in the dollar. The last Chairman of the US Federal Reserve Board to care about the dollar as a store of value was Paul Volcker, who was the chairman of the Fed from 1979 to 1987.

He saved the dollar from collapse in the early 1980s and with the dollar he saved the world’s financial system. However, Alan Greenspan, his successor, was a more political chairman of the Federal Reserve. He wanted to keep the White House happy. On the whole he succeeded in that task, at the expense of the dollar.

One can detect the decline of confidence in every part of the world. The world’s two largest developing economies, economic superpowers of the future, are China and India. Both countries have a long tradition of hoarding gold, often in the form of jewellery, as a form of personal saving. The Chinese and Indian central banks already have more dollars in their reserve than they can possibly want. They know that the dollar is likely to depreciate over time.

They suspect that the American people will elect an inflationary president and Congress next November; as there is no remaining presidential candidate who stands for sound money, that seems the safe assumption. The euro may currently be a better currency than the dollar because it is still being run on sound German principles, though by a Frenchman. Gordon Brown has already undermined the pound by selling half the United Kingdom’s gold reserves at about a third of the present price.

There are also supply problems likely to affect the mining of South African gold. South Africa is short of electrical power because the necessary new power stations have not been built and the maintenance work has not been done. Supplies of power to Zimbabwe have had to be halted and supplies to the goldmines have been curtailed. As a result, China is overtaking South Africa as the world’s largest gold producer – which gives China an incentive to raise the gold price.

The dollar price of gold has been moving in a long cycle, up from 1965 to 1981, down from 1981 to 1999, up from 2000 to 2008. I do not expect this cycle to peak at $1,000 an ounce, though the credit crunch may give it pause. Gold is a defence against inflation. In November the Americans will elect another inflationary president.

That will be good for gold, but bad for the dollar.

(by William Rees-Mogg, The Times, February 25, 2008)

Money that is being used to prop up President Robert Mugabe’s brutal regime, keep his military onside and win over voters in the run-up to Zimbabwe’s elections this month is being printed by a German company.

With inflation topping 100,000% and the highest value 10m Zimbabwe dollar note worth just 20p, heavily guarded planeloads of banknotes are flying into Harare almost every day to keep up with the demand.

Documents obtained by The Sunday Times show the Munich company Giesecke & Devrient (G&D) is receiving more than €500,000 (£382,000) a week for delivering bank notes at the astonishing rate of Z$170 trillion a week.

"The regime is surviving by printing money," said Martin Rupiya, professor of war and security studies at the University of Zimbabwe. "At this stage there is no other way."

According to a source at the Reserve Bank of Zimbabwe, G&D delivers 432,000 sheets of banknotes every week to Fidelity printers in Harare, where they are stamped with the denomination. Each sheet contains 40 notes and the current production is entirely in Z$10m notes.

Last week some of this money was used to award huge pay rises to the army in an apparent move to buy their loyalty ahead of the presidential and parliamentary elections on March 29. Teachers belonging to a union supportive of the government were also given large sums.

Soldiers received windfalls of between Z$1.2 billion for privates and Z$3 billion for officers, while teachers received Z$500m on average. Those belonging to the Progressive Teachers’ Union of Zimbabwe, which criticises Mugabe, were excluded.

"Mugabe is giving soldiers a lot of money as a way of buying allegiance," said Raymond Majongwe, the Progressive union’s general secretary. "Mugabe is planning to rig the elections in March because he must win at all costs. He, however, believes that we teachers do not deserve increased salaries because he says we are agents of regime change."

Last month Z$1 trillion was set aside for managing so-called war veterans "for the purpose of elections". Mugabe has long used the war vets to intimidate voters.

"G&D are literally bankrolling the regime," said a Zimbabwean banker who could not be named for fear of reprisals. "These notes are being used to buy votes, to purchase foreign exchange to import electricity and vehicles to keep their regime going, and to fund the import of Chinese water cannons and police equipment to keep us intimidated.

"They are profiting from evil and should be named and shamed."

G&D’s involvement is embarrassing for the German government which has been one of the most vocal supporters of European Union sanctions against members of the Mugabe regime. Chancellor Angela Merkel has taken a tough stance on Zimbabwe, speaking out at the EU-Africa summit in Lisbon last December to insist that the world cannot stand by while "human rights are trampled underfoot".

Asked about the company, a German foreign ministry spokesman said: "It’s their economic decision. According to current EU sanctions, the government does not have any legal basis to take action."

G&D, the world’s second biggest printer of banknotes, is a secretive company. An official at the Dubai office, which oversees its sales to Africa, confirmed that the government of Zimbabwe was a long-standing client but refused to give details. The headquarters in Munich was no more forthcoming. "The printing of banknotes is a very confidential matter," said Daniela Gaigl, a company spokeswoman. "We don’t comment on any issuing authority."

The Sunday Times has established that G&D has been printing the country’s notes since the breakaway Rhodesian regime of Ian Smith in the 1970s when Britain declared sanctions. After British officers intercepted a consignment, G&D secretly shipped three machines to set up a printing press in the bowels of the Reserve Bank.

These have since been moved to a heavily guarded facility at Msasa in the industrial area of Harare.

The official value of the Zimbabwe dollar is fixed at 30,000 to the US dollar. But traders, businessmen, fuel vendors and even nationalised companies such as Air Zimbabwe use black market rates to set their prices. Last week, within just seven days, the Zim dollar depreciated from 12m to 24m to the US dollar.

Prices in shops rocketed as traders struggled to make money to cover replacement costs. In a Spar supermarket in central Harare, sardines rose from Z$15m per can on Tuesday to Z$30m on Wednesday while the cost of a single lavatory roll rose from Z$5m to Z$8m.

"We have the world’s first million-dollar banana," joked one woman shopper.

The economic crisis is not the only reason that the forthcoming elections may be the toughest faced by Mugabe. The president, who turned 84 on February 21 and has been in power since 1980, is facing an unexpected challenge from within his own ruling party, Zanu-PF.

The candidacy of Simba Makoni, his former finance minister, has breathed life into a campaign in which people had been resigned to the likelihood that Mugabe would once again defeat Morgan Tsvangirai, the leader of the main opposition Movement for Democratic Change (MDC).

An MDC faction led by Arthur Mutambara has thrown its support behind Makoni. "Mugabe goes into these elections the weakest he has ever been," said Gugulethu Moyo, a Zimbabwean lawyer for the International Bar Association. "Makoni’s candidacy has exposed huge fissures in Zanu-PF."

While Makoni claims to have widespread support within the ruling party, few well-known Zanu-PF figures have publicly expressed support. But yesterday, Dumiso Dabengwa, a senior politburo member, threw his weight behind Makoni. "We urged him to come clean and take the burden and we will give him the necessary facilitation and support," he told business leaders.

Makoni’s supporters are widely believed to include the powerful former army chief General Solomon Mujuru, whose wife Joyce is Mugabe’s deputy. Zimbabwean media have reported that Mujuru is under surveillance and his companies under investigation.

Some fear that Makoni may divide the opposition. A fourth candidate has also emerged in the form of Langton Towungana, a little-known independent, who is nevertheless receiving widespread coverage on state television.

Few believe the elections will be free and fair. Negotiations to try to achieve this, led by Thabo Mbeki, South Africa’s president, have collapsed.

(by christina lamb, The Sunday Times, March2, 2008)

The facts about the Lisbon treaty are relatively simple, but the implications are deeply disturbing. In May 2005, the Labour Party won a general election on a manifesto that included a commitment to hold a referendum on the European constitutional treaty.

There were similar commitments in the Conservative and Liberal Democrat manifestos. Referendums were actually held, and the treaty defeated, in France and the Netherlands, but no referendum was ever held in Britain, on the ground that the treaty was dead.

It was not dead, it had merely gone underground.

The constitutional treaty was subsequently reconstructed and became the Lisbon treaty, which contains more than 95 per cent of the same material. Valéry Giscard d’Estaing, a former President of France, described the process: "Public opinion will be led to adopt, without knowing it, the proposals that we dare not present to them directly . . . all the earlier proposals will be in the new text, but will be hidden and disguised in some way." That is what actually was done.

The Government soon recognised that this process had not succeeded in deceiving public opinion. Opinion polls showed that a referendum on the Lisbon treaty would be defeated. The Government therefore decided to break the referendum commitment that had helped it to win the election.

It used an argument, which very few people believed, that the Lisbon treaty was different from the constitutional treaty and did not therefore need a referendum. In the debate in the House of Commons last Wednesday Kenneth Clarke, the leading Conservative Europhile, cut this down to size.

He intervened in David Miliband’s lightweight justification of the Government’s breach of promise. "Will he stop all this nonsense about [the treaty] being different from the constitution when it is plainly the same in substance?" The Government cannot afford to admit that the two treaties are substantially the same, because it would then have no excuse for breaking its commitment. It has to lie about the two treaties because that is the fig leaf to cover a deeper deceit.

Earlier last week the results of an independent mini-referendum were published. There have been votes in ten marginal seats, eight of which are held by Labour and two by Liberal Democrats. The results supported the findings of recent opinion polls but were based on a much larger number of responses. In all, 152,520 people returned the ballots, a 36 per cent turnout that compares favourably with many local government elections.

Two questions were asked: should there be a referendum? Should we approve the Lisbon treaty? In total 87.9 per cent of voters wanted a referendum and 88.8 per cent would vote "no" to the treaty. The results in different constituencies were surprisingly similar, though Hammersmith fell outside the pattern. We had a referendum in Somerset and Frome. The turnout was identical with the average at 36.2 per cent, while 87.9 per cent would vote "no" to Lisbon. Different regions produced similar results.

There can be no real doubt about public opinion; British voters are increasingly critical of the EU. In the House of Commons the argument was used that the public could not be expected to understand the complexities of the Lisbon treaty. If that were so, the Labour Party should not have promised a referendum in the first place.

In any case, these are the traditional arguments against trial by jury, which the British trust. Juries know the difference between guilt and innocence; voters understand their own concerns.

The debate contained several very good speeches, as well as some poor ones. Prime ministers tend to make better speeches after they have retired. The same is true of party leaders. They can be more frank once they are no longer in pursuit of power.

Iain Duncan Smith, a former leader of the Conservatives, has blossomed since he lost the leadership. He gave an insider’s account of the course of events leading up to Lisbon.

"I do not know why we dance around as though this were a silly game. The truth is that the heads of state and governments of all the countries that negotiated the constitutional treaty have said to each other, ‘We have got in a rea mess over this. We allowed the public and politicians who are not responsible members of the government to play a part.’ European bureaucrats have known for years that the way to get things done is never to ask the public . . . because the answer will inevitably be no."

That may largely be true. Yet it would take a retired leader to acknowledge it, because of its consequences. The British public are not unusual in wanting democracy, open government and truthful government. If the EU can be run only on the basis of secrecy and manipulation, then it has no hope of winning public confidence, least of all in Britain.

The Commons voted against a referendum by 311 to 247. There were some Labour rebels and a handful of Tories voted with the Government. The Lib Dems adopted that cringing device, a three-line whip, to abstain. They also had rebels. The result is a direct conflict between the public and the parliamentarians, a conflict made worse by more than 300 Members of Parliament breaking their election commitments. How can we trust such people?

This is bad for Parliament, but worse for the future of Europe. Most Eurosceptics want Europe to be reformed, not destroyed. How ever much it may annoy the Eurofanatics, they are the "good Europeans" who have Europe’s long-term interest at heart. No political society survives without trust. British voters believe that they have been deceived about the Lisbon treaty, a promise has been broken, and the breach justified by lies. If the EU cannot trust the people, the people cannot trust the EU.

(by william rees-mogg, The Times, March 10, 2008)

Take ourselves back to the late 1990s. Oil was just $11 a barrel in 1998, half the level of the year before, but the price rebounded sharply to $35 just as Mr Putin came to power in 2000. Foreign currency reserves tripled and Russia – the world’s largest oil producer and second only to Saudi Arabia as an exporter – has been awash with money ever since as the price of crude has risen to above $100 today.

Russia has wiped out its international debt and built up foreign currency reserves of $480 billion, the third largest in the world after China and Japan. It has also built up a vast stabilisation fund – worth $144 billion and growing – to support future investment and insulate the state budget against falls in the oil price.

Dmitri Medvedev inherits a country transformed by oil, though he cannot hope to enjoy Mr Putin’s luck in seeing revenues triple. One immediate challenge is to tame inflation at almost 12 per cent as the petro-fuelled economy threatens to overheat.

But the former chairman of Gazprom knows that Russia’s status as an energy superpower can only grow. Russia is the world’s largest gas exporter and has the world’s largest proven reserves. It supplies a third of the EU’s gas imports, a dependence that has triggered alarm bells in Brussels, and is extending its reach with new gas pipelines and deals to sell direct to consumers.

Critics say that the Kremlin is already using its energy influence to reassert political influence over its former Soviet neighbours, raising prices and manipulating supply. Russia replies that it is simply switching to market prices for everybody.

Some experts warn that Russia has become dangerously dependent on energy and that a dip in prices would hit the economy hard. Mr Medvedev has made diversification of the economy a central part of his program, promising to encourage the growth of small businesses by slashing red tape and fighting bureaucratic corruption.

Does anyone still believe that the world’s economic clout will remain in North America for long?

(based on Tony Halpin’s report in The Times, 3 March 2008)

March4, 2008

• LeMonde
  Headline: Rice calls for an end to violence against civilians.
  First Paragraph: The American Secretary of State Condoleezza Rice began a middle east visit on Tuesday in Cairo by calling for an end to violence against civilians in Israel and the Palestinian Territories, as well as for a revival of peace talks.
• The CBC
  Headline: Rice accuses Hamas of trying to derail peace process.
  First Paragraph: U.S. Secretary of State Condoleezza Rice accused Hamas militants of provoking Israel’s military incursion into the Gaza Strip and trying to wreck the peace process.
• The Times
  Headline: Israeli minister threatens Gaza reoccupation.
  First paragraph: Israel today threatened to reoccupy the Gaza Strip unless Hamas halted rocket attacks from the territory, as Condoleezza Rice appealed for Israeli and Palestinian leaders to return to the negotiating table.

Dolores breezed along the surface of her life like a flat stone forever skipping across smooth water, rippling reality sporadically but oblivious to it consistently, until she finally lost momentum, sank, and due to an overdose of fluoride as a child which caused her to lie forever on the floor of her life as useless as an appendix and as lonely as a five-hundred-pound barbell in a steroid-free fitness center.

(linda vernon, Newark, California)