Angela Merkel backed attack on the City Tuesday December 13, 2011 by Frederick Forsyth.

Dear Madame Chancellor,

PERMIT me to begin this letter with a brief description of my knowledge of, and affection for, your country.

I first came to Germany as a boy student aged 13 in 1952, two years before you were born. After three extended vacations with German families who spoke no English I found at the age of 16 and to my pleasure that I could pass for German among Germans.

In my 20s I was posted as a foreign correspondent to East Germany in 1963, when you would have been a schoolgirl just north of East Berlin where I lived.

I know Germany, Frau Merkel, from the alleys of Hamburg to the spires of Dresden, from the Rhine to the Oder, from the bleak Baltic coast to the snows of the Bavarian Alps. I say this only to show you that I am neither ignoramus nor enemy.

I also had occasion in those years to visit the many thousands of my countrymen who held the line of the Elbe against 50,000 Soviet main battle tanks and thus kept Germany free to recover, modernise and prosper at no defence cost to herself.

And from inside the Cold War I saw our decades of effort to defeat the Soviet empire and set your East Germany free.

I was therefore disappointed last Friday to see you take the part of a small and vindictive Frenchman in what can only be seen as a targeted attack on the land of my fathers.

We both know that every country has at least one aspect of its society or economy that is so crucial, so vital that it simply cannot be conceded.

For Germany it is surely your automotive sector, your car industry.

Any foreign-sourced measure to target German cars and render them unsaleable would have to be opposed to vetopoint by a German chancellor.

For France it is the agricultural sector. For more than 50 years members of the EU have been taxed under the terms of the Common Agricultural Policy in order to subsidise France’s agriculture. Indeed, the CAP has been the cornerstone of every EU budget since the first day.

Attack it and France fights back.

For us the crucial corner of our economy is the financial services industry. Although parts of it exist all over the country it is
concentrated in that part of London known even internationally as “the City”.

It is not just a few greedy bankers; we both have those but the City is far more. It is indeed a vast banking agglomeration of more banks than anywhere else in the world.

But that is the tip of the iceberg. Also in the City is the world’s greatest concentration of insurance companies.

Add to that the brokers; traders in stocks and shares worldwide, second only, and then maybe not, to Wall Street. But it is not just stocks.

The City is also home to the “exchanges” of gold and precious metals, diamonds, base metals, commodities, futures, derivatives, coffee, cocoa. the list goes on and on.

And it does not yet touch upon shipping, aviation, fuels, energy, textiles. enough. Suffice to say the City is the biggest and busiest marketplace in the world.

It makes the Paris Bourse look like a parish council set against the United Nations and even dwarfs your Frankfurt many times.

That, surely, is the point of what happened in Brussels. The French wish to wreck it and you seem to have agreed. Its contribution to the British economy is not simply useful nor even merely valuable.

It is absolutely crucial. The financial services industry contributes 10 per cent of our Gross Domestic Product and 17.5 per cent of our taxation revenue.

A direct and targeted attack on the City is an attack on my country. But that, although devised in Paris, is what you have chosen to support.

You seem to have decided that Britain is once again Germany’s enemy, a situation that has not existed since 1945.

I deeply regret this but the choice was yours and entirely yours. The Transaction Tax or Tobin Tax you reserve the right to impose would not even generate money for Brussels.

It would simply lead to massive emigration from London to other havens. Long ago it was necessary to live in a city to trade in it.

In the days when deals can flash across the world in a nanosecond all a major brokerage needs is a suite of rooms, computers, telephones and the talent of the young people barking offers and agreements down the phone.

Such a suite of rooms could be in Berne, Thun, Zurich or even Singapore. Under your Tobin Tax tens of thousands would leave London.

This would not help Brussels, it would simply help destroy the British economy.

Your conference did not even save the euro. Permit me a few home truths about it. The euro is a Franco-German construct.

It was a German chancellor (Kohl) who ordered a German banker (Karl Otto Pohl) to get together with a French civil servant (Delors) on the orders of a French president (Mitterrand) and create a common currency.

Which they did. IT was a flawed construct. Like a ship with a twisted hull it might float in calm water but if it ever hit a force eight it would probably founder.

Even then it might have worked for it was launched with a manual of rules, the Growth And Stability Pact. If the terms of that book of rules had been complied with the Good Ship Euro might have survived.

But compliance was entrusted to the European Central Bank which catastrophically failed to insist on that compliance.

Rules governing the growing of cucumbers are more zealously enforced. This was a European Bank in a German city under a French president and it failed in its primary, even its sole, duty.

This had everything to do with France and Germany and nothing whatever to do with Britain.

Yet in Brussels last week the EU pack seemed intent only on venting its spleen on the country that wisely refused to abolish its pound.

You did not even address yourselves to saving the euro but only to seeking a way to ensure it might work in some future time.

But the euro will not be saved. It is crumbling now. And since you have now turned against my country, from this side of the Channel, Madame Chancellor, one can only say of the euro:

YOU MADE IT, YOU MEND IT.

• 5.5 million - The number of people employed by the rural economy
• 800 - Village shops close each year
• £2.2 billion - Domestic food and drink contribution to the UK economy
• British livestock is highly sought after for international breeding
• Agricultural contribution to the economy in £millions
  • 2001 - £6720
  • 2002 - £6852
  • 2003 - £7151
  • 2004 - £6900
  • 2005 - £6750
  • 2006 - £6550
• 70% of all our drinking water comes from the upland areas of the UK
• UK Land use across the UK - 80% farmland - 20% non-farmland
• UK self-sufficiency - 60% domestically grown food - 40% imported food
• The UK is the 7th largest producer of wool globally
• The rural tourism sector generates £14 billion from 75 million visits per year
• 60,000 new entrants are needed in the farming industry in the next decade

Source: The Prince’s Countryside Fund

No one could forget the footage of the pyres of livestock during the Foot and Mouth Disease (FMD). The contiguous culling policy accounted for 10 million animals even though only 2,000 cases were confirmed. The Government even drafted in hunt staff  when it became clear the cull was being badly handled and carried out. The outbreak devastated whole families and communities and no one was really sure if the farming industry would bounce back.

Many farmers adapted to post-FMD farming. On-farm enterprises such as farm shops, tea shops, B&Bs, bakeries and wildlife nature trails have grown out of necessity - keep the farm going, make it viable. The way farming has moved on from FMD should provide encouragement. The British grit, determination and ability to pick ourselves up whatever the circumstances has proven invaluable.

An influential new report into the cost of living in rural areas has confirmed what many have long suspected - living in the countryside is more expensive than in urban areas.

The report was launched by the Joseph Rowntree Foundation. Researchers used the charity’s nationally-accepted Minimum Income Standard to work out that a single person needs to earn £15,600 to get by if they live in a rural town, £17,900 a year if they live in a village and £18,600 if they live in a hamlet or in the remote countryside. A person living in an urban area needs £14,400 a year to meet the specified minimum.

People living in the countryside are hit by having to own and run a car. They face higher energy bills from heating older homes and are forced to use more expensive fuels if they are not connected to the gas network.

For many families in rural areas, it is a constant struggle to make ends meet, meaning they often have to spend up to twenty per cent more than an urban family to match their standard of living. This is despite the average wage in the countryside being much lower than the average wage of those who work in towns and cities.

A single person living in a rural area needs to earn at least £8.89 an hour, fifty per cent above the average minimum wage, just to be able to afford the minimum acceptable standard of living. For families with children living in remote areas the difference is even greater - to earn enough to get by, a typical two child family living in a hamlet needs to earn as much as £72 a week more than the same family living in an urban area.

The rising cost of living means many rural families are forced to move to urban areas. Long-established community networks are broken up as families struggle to set foot on the property ladder or move away to be closer to local amenities at no extra cost.

This report confirmed the fundamental reason behind the Countryside Alliance’s recent Rural Manifesto - people living in the countryside do not seek special treatment but they do want fair treatment. The Alliance will continue to campaign for improved facilities such as transport links, post offices and schools. We will also strive to work towards a countryside where local families are not forced out by rising property prices, a lack of social housing and the financial inability to live and work in the area.

Campaigning for a thriving countryside has always been vital to the Alliance’s existence. At the heart of all that we do are the people who live and work there.

Alice Barnard
Chief Executive
Countryside Alliance

Defra has announced spending cuts of £700m over four years, yet it is far from clear where exactly the axe will fall. Defra has taken one of the biggest hits in Whitehall, in terms of the proportion of its budget that will be cut. At 8% a year from their annual £2.9bn budget, this amounts to almost 30% by 2015.

They will achieve this by reducing resource spending by 29%, capital spending by 34% and administration by 33% over the next five years. The number of DEFRA supported quangos is to be cut from 92 to 39 with increased accountability and transparency. Running costs are to be cut by £174 million by reducing staffing levels and improving efficiency and IT usage.

Next-generation broadband is among a handful of projects to survive the cuts. The BBC has agreed to contribute £300m towards the £530m total cost of funding rural broadband.

Ben Stafford, Campaign to Protect Rural England said: “This government has set itself a high bar by pledging to be the ‘greenest ever’. Significant cuts to the main environmental departments will not make clearing that bar any easier. We await further detail, but subsidised rural bus services are likely to face challenging times, thanks to the combination of a 20% cut in bus subsidy grant and a 28% cut in local authority funding. CPRE and other organisations lobbied the government hard on the importance of environmental stewardship schemes through which farmers are able to look after the landscape features and wildlife on their land. We welcome the announced 80% increase to the Higher Level Stewardship scheme over the funding period.”