Changing the equation

One of the "killer points" against reliance on nuclear energy is the enormous cost of decommissioning power the power stations at the end of their working life. Currently, to deal with first generation of power plants, the cost is estimated at £73 billion.

However, out of the blue, we learn that the nuclear industry has produced a "hidden" resource in the form of a stockpile of plutonium and uranium equivalent to 2.6 billion barrels of oil. If converted to fuel, it could be worth nearly £160 billion and power three nuclear reactors for 60 years.

Furthermore, this stockpile is to become the responsibility of the Nuclear Decommissioning Authority (NDA), which acts on behalf of the State. At the moment it is classified as neither a liability nor an asset but, if it is now classified as an asset, this would make a nice little nest egg for Gordon Brown.

More to the point, by recycling plutonium and uranium into so-called mixed oxide fuel (MOX), these materials can be used in advanced nuclear reactors, of the types currently operated in France, Germany, Japan and Belgium.

Although we have no commercial capacity for using MOX, all three reactor designs being considered for Britain by the Nuclear Installations Inspectorate could burn this fuel. MOX is already made at Sellafield for use overseas, but a £1-2 billion investment in a new fabrication plant would be required to produce commercial quantities for UK use. That cost, however, could be offset against the £2 billion disposal costs that would be incurred if the stockpile was not used.

Happily, the fuel is hated by the greenies - alone a good reason for using it - but, even better, its use as nuclear fuel would further discomfort them by saving 0.5 billion tons of carbon dioxide emissions.

All of a sudden, therefore, the nuclear power equation has tilted decisively in favour of building new nuclear plants. Far from being a liability, it looks as if the industry has been paying its way and the cost-hurdle of decommissioning should no longer be an issue.

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The ultimate joke

Whatever the outcome of the Russian escapade in Georgia, the one thing on which most commentators seem to agree is that the EU has not come well out of the experience.

Few, however, are as forthright as US columnist, J R Nyquist, writing for Global Analaysis who has decided that Moscow's "blitzkrieg" in Georgia is more than a military campaign.

It is designed, he writes, to empower Russia's diplomatic strategy, which seeks to make the European Union the West's chief representative in future negotiations with Russia. Quite naturally the Kremlin wants to escape the logic of U.S. and NATO policy, which is to contain Russia within her national borders.

The logic of this, according to Nyquist, is that the European Union is an entirely different animal: "toothless, utopian and ready to please." Better to deal with this organisation than a tough nut United States. Today, he continues, the European Union confronts Russia in the same way Neville Chamberlain confronted Hitler in 1938; being outwitted and tricked in the cease fire negotiations, there is no possible outcome other than appeasement.

Pointing at Sarkozy's "triumph", he notes now the Russians insisted that their troops were accepted as peacekeepers in Georgia and the French mediators caved in and allowed this. Thus, the stipulated withdrawal of combatants does not apply to Russian troops.

Under this ceasefire agreement Moscow can claim – in a strictly legal sense – that Russian troops can stay in Georgia indefinitely. President Medvedev and Prime Minister Putin are laughing at the French while observing international law. Meanwhile, occupied Georgia is looted and burned; Georgian ships are sunk and the Georgian capital is strangled.

Nor is the purple prose confined to the commentators. My co-editor has already taken a side-swipe at the Common Foreign Policy - when she featured our favourite Polish politician - but, it appears, dear old president Lech Kaczynski was only just warming up.

To the Rzeczpospolita newspaper yesterday he declared that the EU was "too soft on Russia", complaining that it should have been more critical of Russia's military assault on Georgia, with the bloc making clear to Moscow that "imperial times have ended".

As for the Common Foreign Policy, this he said was dictated by France and Germany. "Once again it turned out that, in actuality, decisions of this organisation (the EU) were being taken between Berlin and Paris. (French President Nicolas) Sarkozy agreed the position with Chancellor Angela Merkel, whose voice proved to be decisive," Kaczynski said.

He also complains that the French deal lacked a key element – recognition of Georgia's territorial integrity, adding that he believed the EU reaction "should have been more decisive."

With all that, it was a "joke" to suggest that the 27-nation EU had a common stance. Then speculating on what such a policy would be, he had but one word, "submissiveness".

Perhaps the biggest joke of all, however, is perhaps our own politicians, whose posturing has been noted, even by the Independent. Gordon Brown and David Miliband, we are told, "merely mouthed empty platitudes about the crisis".

What this rabidly europhile newspaper does not say, though, is that there is a "common position" on relations with former Soviet satellites and Russia. Therefore, any dealings must go through the EU presidency – in this case the egregious Sarkozy.

That is indeed the ultimate joke. Great Britain, once the head of an empire on which the sun never set, is reduced to a bit part, while a French president supposedly represents our interests. And all because our political class is so enamoured of the EU.

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Unintended consequences

On this blog we have always maintained that former President, now Prime Minister, Putin and his teddy bear (mishka), President Medvedev tend to be less than adroit when it comes to foreign adventures, whether attempts to bully and blackmail or, as has now happened, actual military invasion (and no, I do not mean South Ossetia, which has been under Russian occupation for something like ten years).

Chancellor Merkel, who led the nay-sayers during the last NATO Summit in Sofia, and thus may be said to have helped to precipitate the crisis in the Caucasus, has now changed her mind. She is reported by AP as saying that Georgia is strongly on track to becoming a member of NATO, which is not entirely logical but there you are.

Her comments, as reported by AP are not precisely accurate. It is not an EU ceasefire we are talking about but a Russian one that they keep offering but never quite keeping to. The EU has not precisely covered itself with glory. Also, the state of the Georgian military is not entirely clear. There are several opinions, some maintaining that the Russians did not have a totally easy ride.

Meanwhile, thanks to Glenn Reynolds on Instapundit, we learn that

Ukraine has agreed to take part in a missile defence system designed by the United States to protect Western countries. The government in Kiev defended its decision for military co-operation with the West, saying Russia cancelled a bilateral treaty with Ukraine earlier this year.

No doubt, this will be interpreted by all the Kremlin-lovers, since they cannot be described as Russia-lovers, as a "humilation" for Russia.

Whatever one calls it, this is not precisely what Mr Putin had intended, one assumes. Some things have changed in the last forty years. Time for Russia's rulers to understand that.

COMMENT THREAD

The scourge of the greenies – US style

Confounding my earlier prediction that Booker would not be able to file his column this week – having been stuck in Newark for a day – The Sunday Telegraph gave him a time extension which enabled him to file late Saturday instead of the customary Friday.

So it is that Booker has been able to make as his theme our recent experiences from our journey into the land of the free where, like me, he was shocked by the extent to which the "greenies" have taken over the energy agenda.

What particularly struck Booker were a series of television commercials for the two presidential candidates, Senators McCain and Obama, each of whom were shown in front of film of the same giant wind farm, to lay claim to virtually identical "green" credentials.

Since, Booker writes, America has already built five times as many wind turbines as Britain, covering thousands of square miles, he checked out how much electricity all those 10,000 turbines actually produce. His answer came to around 4.5 gigawatts - not much more than a single large coal-fired power station.

Actually, these were "back of the envelope" calculations. The installed capacity for US wind farms is just over 18 GW, while the average output is a mere 16.8 percent, giving a system-wide output of around 3 GW. This is less than the coal-fired Robert W Scherer power plant at Juliette, Georgia, which produces 3.52 GW.

In fact, the situation is even worse than that. Because the output of the wind turbines can range from 0-49 percent of installed capacity, the average figure of 16.8 percent is considered too optimistic because it fails adequately to recognise the intermittency of wind generation. To meet peak system demand, a wind capacity value of a mere two percent of installed capacity is being considered, reducing the 18 GW to just over one third of one gigawatt.

That the two presidential candidates should, despite this, endorse wind power, comes as something of a shock. After years when America was vilified for not taking "global warming" seriously, the greenie agenda is now threatening to transform what is still the largest and richest economy in the world.

For instance, both candidates favour a version of the proposed "cap and trade" scheme, McCain coming out in support in May, following Obama into the pit after he released his energy plan last October.

Yet, conservative estimates of the cost of reducing US greenhouse gas emissions by 63 percent of 2005 levels run to more than $600 billion a year, at by 2030 of - representing a cumulative loss to the US economy, within 22 years, of $4.8 trillion - and Obama wants to go for 80 percent.

Although America is still dependent on coal for around half its electricity, with reserves estimated as likely to last 200 years, state after state is proposing to ban new coal-fired power stations. Environmental groups, with powerful political support, are now lobbying equally fiercely against natural gas or any new nuclear power plants.

Most dramatic of all are the implications of a Supreme Court judgement in the case of Massachusetts v EPA which ruled by a single vote that the EPA (effectively) must treat any greenhouse gases as "pollution", to be regulated under America's Clean Air Act.

The EPA is thus mandated to impose drastic new limits on emissions of carbon dioxide and other gases from pretty well any source, not just industry and transport but schools, hospitals, even lawn mowers.

The implications of this development – which have escaped the attention of the British media - are so immense for almost every sector of the US economy that government departments - commerce, agriculture, energy and others - have been queuing up to protest, arguing that the effects of such regulation would be so damaging that it should be regarded as unthinkable.

But politicians of both parties, led by the two men vying for the presidency, are so carried away in the rush to appear "green" that it seems there is no longer any national voice powerful enough to question the sanity of such measures.

All the fashionable talk is of how fossil-fuels must be replaced by massively subsidised sources of "renewable" energy, such as vast arrays of solar panels, even though a recent study (which we pointed out in an earlier piece) showed that a kilowatt hour of solar-generated electricity costs between 25 and 30 cents, compared with 6 cents for power generated from coal and 9 cents for that produced by natural gas.

What is terrifying, writes Booker, is the extent to which America's leading politicians seem oblivious to the economic realities of what they are proposing. The readiness of Messrs McCain and Obama to posture in front of pictures of virtually useless wind turbines symbolises that attitude perfectly.

Here, in the EU we are only too sadly familiar with politicians floating off into cloud cuckoo land over our future energy policy, with the virtual certainty that before many years this may leave us with a colossal shortfall in our electricity supplies.

But "the lights going out all over Europe" is one thing: if they go out in the richest economy in the world - while China cheerfully continues to build one new coal-fired power station a week - we may look back on the US presidential election of 2008 as a time when history really did reach a watershed; the moment when the nations of the West finally signed up to the most bizarre suicide note the world has ever seen.

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Good news and bad news

The most important economic news of recent weeks, Irwin Stelzer tells us in today's edition of The Sunday Times is the recovery of the long-comatose dollar.

But what is good news for the US economy seems to be bad news for the eurozone. Ambrose Evans-Pritchard reported earlier this week that the ECB was taking a hammering for making a serious error by raising interest rates a quarter point to 4.25pc last month.

It seems that it has misjudged the seriousness of the downturn in the eurozone economy, which has seen a contraction of 0.2 percent in the second quarter, compared with the first three months of this year, with the economies of Germany, France and Italy probably now in full recession.

In Spain, the picture is darkening so fast in Spain that Prime Minister Jose Luis Zapatero cancelled holidays and called his cabinet back to Madrid mid-week for the first emergency session of its kind since the Franco dictatorship. The crisis meeting agreed to a €20bn (£16bn) blitz on public works, tax cuts, and a mortgage rescue to halt the downward spiral.

Growth has also turned negative in Ireland, Denmark, Latvia, and Estonia, while grinding to a halt in Sweden and The Netherlands. Iceland contracted by a staggering 3.7 percent.

However, if Ambrose always has a "down" on the eurozone, and is thus considered by some a little biased on the pessimistic side, not so the Wall Street Journal which yesterday took a swipe at the "colleagues".

Throughout the depth of the financial crisis in the US, the Euros have been warbling consistently about "decoupling" – arguing that the mighty European economy is no longer a slave to the American economy, and obeys its own rule. Europe would remain sound while the US would sink into a bottomless pit.

And, says the WSJ, Euro-zone hopes about decoupling from the US economy seem to have come true. But, in tune with the immutable law that dictates that nemesis always follows hubris, this decoupling is not quite as planned. While the eurozone contracted by 0.2, the US posted second-quarter growth of 0.5 percent

Like US fears of a recession, says the paper, the eurozone's economic resilience appears to be, if not mostly "mental," at least somewhat exaggerated. Despite all the talk about a US recession, it concludes, the economy may actually unravel faster across in Europe.

This is certainly what the markets think, for the moment, even the Financial Times reporting that they are becoming increasingly convinced that the US is best-placed to weather the global downturn. But then, if you think about it, for an organisation that gave us the Common Fisheries Policy, it never was a safe bet that the EU would be any better at managing the eurozone economy.

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And so it goes

As we approach the fortieth anniversary of the Soviet invasion of Czechoslovakia it seems almost incredible that I should be attending another rally where the cry is "Russian troops out". But so it was today opposite Parliament.

A respectable number of Georgians (given the short notice of the demo) and representatives of a few other countries who are wondering who is next on the menu were there. Here are a couple of pictures, taken on my phone after the battery on the camera went.

Sadly, these pictures show the rather ramshackle "peace camp" whose denizens did not join the demo as clearly they did not know where Georgia is and why anyone should care about it. The other photos, to be uploaded soon, avoid them.

The rather elegant St George's flag is, as most readers will know by now, that of Georgia. The other one is of Albania. There were also Ukrainian flags, Lithuanian and one or two others, including one I did not recognize that was carried by a clearly Muslin family. Some research will be needed.

COMMENT THREAD

The decay of a nation

Having for the last week enjoyed the Wall Street Journal as breakfast reading, returning now to trivial venality of the British press, I am warming to my co-editor's view that the WSJ is definitely the paper to read.

Even without the print copy though, much of the content is still available in the online version and yesterday saw a superb article by Edward Gresser and Marc Dunkelman highlighting how "Free Trade Can Fight Terror".

What warms us to the thesis, of course, is that we made precisely that point in June, arguing that the best way forward to long-term peace in Afghanistan was by developing trade, and in particular the country's exports.

Gresser and Dunkelman, however, take this further, noting that there is a fierce competition among foreign countries to sell their products in the United States – "the largest commercial market in the world".

By opening up the US market to Muslim countries, they argue that this could not only help American consumers, "but also serve a larger strategic goal: that of boosting the economies which now produce large pools of unemployed, embittered youth." We can, they add, make trade an effective weapon against terrorism.

As always, at the heart of the problem is the tariff regime. This puts many nations in the Middle East, whose young people are susceptible to the sirens of Islamic fundamentalism, at an unintended disadvantage and works against our efforts to stamp out jihadism.

Fortunately, write Gresser and Dunkelman, the problem is easy to fix. The US buys about a fifth of all the goods and services traded world-wide - importing $2.63 trillion worth of the world's products last year alone. Socks come in from the Caribbean, towels from Pakistan, cheese from France, and oil from Saudi Arabia.

But apart from oil, the pair tell us, very little comes from the Muslim world. The 30 majority-Muslim states of the greater Middle East, from Morocco through Egypt to Pakistan and Central Asia, account for about 10 percent of the world's population. Yet they provide only about one percent of US manufactured imports, and an even smaller fraction of US farm imports.

These statistics, they say:

… hint at one of the least-studied but most ominous aspects of the modern global economy. Most of us frame the last quarter-century with narratives about globalisation, the rise of China and the spread of the Internet. But for the Muslim countries of the Middle East, and their neighbours in Pakistan and Central Asia, it was a period of economic disaster rivalling our Great Depression.

Between 1980 and 2000, their share of world trade fell by 75 percent, and their share of investment fell even faster. The region's unemployment rate became the world's highest, rising to an average of 25 percent for young people. With the region's population rising by nearly a quarter-billion, the high unemployment rates mean a pool of perhaps 25 million jobless and sometimes hopeless young people, often easy targets for fundamentalists.

The relationship between unemployment and insurgency recruitment has been well established. In Kabul, for instance – where displaced rural workers are flooding into the capital – it is well known that the Taleban hire young, unemployed men to engage in terrorist activities

At last, however, the problem is being recognised – in part. Democratic senator Maria Cantwell has introducing a bill called the Afghanistan and Pakistan Reconstruction Opportunity Zones Act of 2008. It aims to waive tariffs on many goods from Afghanistan and Pakistan's frontier provinces, so promoting trade from those regions.

But, with trade inevitably featuring large in the continuing presidential campaign, Gresser and Dunkelman argue that the next president should follow up with a broad, tariff-exemption initiative to help the Muslim world break its downwards spiral, revive trade and put its young people back to work.

They accept that a comprehensive solution to Middle East economic problems will require efforts to stamp out corruption, improve schooling and end political oppression. But few things, they declare, could do more to combat terrorist recruitment than draining the pools of angry and unemployed youth that are spread across this region. "Fixing American trade policy would be a good start."

Apart from agreeing completely, we would argue that that should include fixing the Bumpers amendment, the malign effect of which we noted in our piece. Support for rebuilding the Afghan cotton industry (cotton trading pictured above) could then be permitted.

That apart though, the key issue here is that the United States is capable of having a meaningful debate about trade policy during its presidential election campaign. Not so the UK where the Gresser/Dunkelman argument applies with equal force to our involvement in Muslim countries. In our benighted country, trade policy is a matter for the European Union.

So, while we still have the residual powers to send troops on combat operations, we do not have the wherewithal to fix the underlying conditions which give rise to – or perpetuate – terrorism. These could never become an issue in a general election. In this, therefore, we are no longer a complete nation, and thus become part of the problem which must be resolved by others.

Few people – and especially the British media – understand or accept how much thereby we have lost our independence but, at least, the WSJ in providing a contrast, gives those who wish to see it the opportunity to understand how deep-rooted has become the decay in our body politic and our nation.

COMMENT THREAD

A journey from hell

Well, we left central Washington yesterday at about 2 pm local time, in order to catch the 4.59 pm shuttle to Newark and thence back to the UK - me to Manchester and Booker to Bristol.

On arrival, we were told the shuttle had been delayed - half an hour initially, and then an hour, and then two, and then three ... Booker was alright but my connection was lost and I had to rebook for a 10 pm flight. Frustration mounting, we were finally let on board, only to be stuck in the "penalty box" off the runway for another two hours.

By the time we got to Newark, we seemed doomed. More in hope than expectation, we split up and dashed to our separate gates. My gate area was empty, so I went up to the booking desk to ask what to do next... Miracle - your flight is boarding, I was told. It had been delayed and then re-allocated to a different gate. By the skin of my teeth, I caught the flight and got back to Manchester shortly before 11 am UK time - some 17 hours after leaving downtown Washington.

However, my luggage is still in Newark and so, as I have now discovered, is the unfortunate Booker. He missed his connection and is waiting there for a flight out tonight. And like me, he is also separated from his luggage. Worse still, without his computer and suitable facilities, writing is impossible. For the first time in many a moon, there will be no Booker column in The Sunday Telegraph this weekend.

Happy bunnies we are not. But, even if Booker is the wrong side of the pond, normal blogging will resume here shortly.

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Concentrates the mind

I do not like drawing inexact historical parallels but the news that Poland and the USA will shortly sign (if, indeed, have not already done so, as the BBC Russian Service says) that agreement for setting up a defence shield made me smile (as well as I can do so after a very painful session in the dentist's chair).

The plan would see the US base 10 missile interceptors in Poland in exchange for help strengthening Polish defences, said PM Donald Tusk.

Of course, the parallels with 1938/9 are not really that. It was the Poles who were dragging their feet this time but I imagine the argument about strengthening Polish defences came to the fore in those negotiations.

No blogging yesterday at this end

Fortunately, the boss managed to weigh in about his trip to the land of the free and the brave (the only country that seems to be standing up for beleaguered Georgia but more of that later) as I had various other preoccupations, including a chat with some Georgians who were demonstrating opposite the Russian consulate in Bayswater Road. The embassy is in a private road that can be closed off.

It revived fond memories of past demonstrations in that very place, including some about forty years ago - the anniversary of those tanks rolling into Prague is coming up soon.

Today I shall try to bring the Georgian story up to date and do that posting about Russia's "victim" status. Meanwhile, I have abandoned the open threads. With one exception they were not a success.

In the meantime, here is a quick posting on the BrugesGroupBlog about the EU's common foreign policy (not!). Enjoy.