This story runs strongly in the business papers but its political significance is such that it ought to be on the front pages. This is a conquest of Britain every bit as much as if Hitler had succeeded in crossing the Channel in 1940. But then we were resolute and properly led. The papers fill their pages with trashy stories, the government colludes with the invaders - a real 5th column, and the rest of the political classes haven’t noticed.
Notice, in the second piece here, Mandelson saying his piece as the arch-traitor in our midst owing allegiance to his master, the EU.
Christina
TELEGRAPH
10.7.09
1. EU attack on City of London is 'opportunistic'
The European Union's plan for a new machinery of financial regulation is an "opportunistic" attempt to extend EU power and is largely based on unsubstantiated claims, according to a hard-hitting report by the Adam Smith Institute and the London Business School.
By Ambrose Evans-Pritchard
The study said the British Government has responded with incoherent or irrelevant objections as Europe's elites seize on events to rush through laws that greatly increase EU control over the City of London.
"The proposals seem opportunistic, using the financial crisis to provide an opening for long-held political objectives," it said, accusing Brussels of trying to transform the financial system "while it is too weak to object".
"Since financial crises of this scale come along only every sixty years, there is no economic reason for this haste," it said.
The European Commission has made no attempt to validate it claim that lack of EU cross-border rules was a key cause of credit crisis, ignoring evidence that the real damage stemmed from the failure of countries to enforce their existing rules properly. "Instead of dealing with the fundamental problem, the Commission is instead proposing to add new bureaucratic structures."
The key bone of contention is the creation of three new "Authorities" with a permanent staff and binding powers: a European Banking Authority in London; a European Insurance and Pensions Authority in Frankfurt; and a European Securities Authority in Paris.
While they look like the current advisory committees made up of chief regulators from the 27 member states, they are in reality executive agencies able to impose their agenda, with powers to "settle the matter" in the case of disputes. They effectively strip Britain of ultimate control over much of the City, leaving "day-to-day" matters to the Financial Services Authority.
Keith Boyfield, co-author of the report and chair of the Regulatory Evaluation Group, said the raft of proposals coming from Brussels together amount to an extremely serious assault on the City .
"When you look at this you wonder whether Alistair Darling's White Paper is a pointless exercise," he said.
The Government appears confused by the rush of events. Rather than fight the core issue of transferring control to Brussels, it has been arguing over whether the bodies should be run by the Commission or the Council. Either way, London loses ultimate control.
Gordon Brown agreed to the plans at last month’s Brussels summit, provided they do not impinge on “fiscal sovereignty”. Lord Mandelson has since said Britain should forge an alliance with those EU states in our camp to limit it saying “we have more skin in this game than the rest of Europe put together”.
An EU insider said the credit crisis had thrown up an unholy alliance between nationalist politicians from France, Italy, and Spain hoping to chip away at the City, and Left-wing forces opposed to market capitalism.
The two together are a formidable bloc.
2. EU's regulation of City would 'strangle' London, says Mayor Johnson
Boris Johnson, the Mayor of London, said yesterday that European plans to regulate the financial services sector threatened to drive hedge funds out of London and Europe, even though they were "blameless" for the crisis.
By Angela Monaghan
London mayor Boris Johnson, who said, 'My greatest worry is that this is just the start of a flood of draft directives that will start to filter out of Brussels.'
Speaking at a conference in London he said: "It's utterly crazy that we should allow the EU to launch an attack on the City's alternative investment funds. I believe this EU directive is a mistake and against the interests of Europe," he said.
"Hedge funds won't go to Paris or Frankfurt, they'll go to New York or Shanghai. What is good for London is good for the UK and what is good for London is good for Europe."
The Mayor's office said it was estimated that hedge funds contributed about £3bn in tax a year, and employed 35,000 people directly and indirectly in London. Mr Johnson said that the right thing to do would be for regulation at the global level – by the G20 – reflecting financial services' worldwide nature.
That way, he argued, regulation could be formed that worked for London and its competing cities, including New York, Geneva, Hong Kong and Singapore. Otherwise the City of London would be "strangled".
"My greatest worry is that this is just the start of a flood of draft directives that will start to filter out of Brussels," he said.
The Mayor called on Lord Mandelson, the Business Secretary, and the Government to help him to resist. However, Lord Mandelson, who spoke immediately after Mr Johnson, said that it was in Britain's best interests to co-operate with Europe.
"We've got to be involved in the regulation. We won't influence EU policy by cutting ourselves out of Europe. I hope that's a message Boris takes to his colleagues," he said, [Let us hope that Boris takes the threat seriously and tells Cameron that ‘This is War’. -cs] adding that London must stay alert to competition in the rest of the world and stay ahead of the curve.
He added: "Cultural change in the boardrooms and back offices will need to take place. Old-fashioned banking needs to return to the City."
The Mayor also urged London businesses to double the size of their apprenticeship schemes to ease the impact of rising unemployment
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