Tory MP: Politicians treated like Jews in Nazi Germany

The most absurd statement on the expenses scandal?

So we've heard Anthony Steen claim that voters are only angered by his expenses because they are envious of his "very, very large house". We've heard Alan Duncan declare that MPs are "treated like shit" and "forced to live on rations". But we've now heard what is indisputably the most absurd statement on the expenses scandal.

The Tory MP David Wilshire has compared the treatment of politicians to that of the Jews in Nazi Germany. Wilshire's use of the reductio ad Hitlerum came in a letter to a constituent:

The witch hunt against MPs in general will undermine democracy. It will weaken parliament -- handing yet more power to governments. Branding a whole group of people as undesirables led to Hitler's gas chambers.

The Telegraph has the full story here. David Cameron will be relieved that Wilshire, who paid £100,000 in expenses to his own company, plans to stand down at the next election.

Update: Cameron has ordered Wilshire to retract his comments. He said: "It's a frankly ludicrous thing to say and I think he should withdraw it. MPs have got to understand that the public do not have confidence in our expenses system. The expenses system needs to change, MPs need to understand that.

"People don't want to hear MPs sounding off like that."

George Eaton is political editor of the New Statesman.

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Promoted by Janus Henderson

Europe: as the politics subside

How long can a resurgence of investor interest in Europe last?

Might Europe be the place to be?

I think European equities tick a lot of the right boxes right now. Economies are recovering – indeed the first quarter of 2017 saw Europe once more grow faster than the US, having outpaced the world’s largest economy in 2016. Valuations are not excessive, either relative to the region’s history or the US equity market. Like almost anything, I believe European equities also look compelling relative to bonds. The final part of the jigsaw puzzle might have been earnings growth, but here too Europe is, at last, getting close to achieving a gold star.

Most of this has been known for quite a few months now and is part of the explanation for the better performance of Europe year to date. Even the euro has strengthened against the US dollar, from about $1.05 at the start of 2017 to $1.12 at the time of writing. Politics looks more settled, after the surprises of the Brexit vote last year in the UK and the election of Donald Trump in the US Presidential election. Perhaps a comment I made at the beginning of 2017, that “by the end of 2017 the UK and the US might look to have been the exceptions” when it comes to successful populist votes, seems more prescient.

Now that the political backdrop is perhaps more settled, with the UK’s potentially tragic Brexit decision an exception, how long can a resurgence of interest in Europe last? One threat is the gradual move towards ‘tapering’ by the European Central Bank (ECB) of its unprecedented quantitative easing program, and the support this provides economies by injecting cash to drive down the cost of borrowing and increase consumer and business spending. But it is already clear that this will be a very slow process. The economic recovery in Europe remains quite slow and inflation, outside the UK, is well below the ECB’s target of ‘below or close to’ 2%. At the same time, the damaging effect of negative interest rates needs to be avoided.

 

What could derail this market?

The one exception to what looks to be a relatively rosy scenario, in my view, remains the UK. The Brexit ball is rolling onwards, following the invocation of the now infamous Article 50, but the calling of a General Election was another distraction. The UK is still no closer to knowing what sort of Brexit is desirable, or more likely, economically feasible. Once the reality of debt, demographics and a weak currency become clear, I suspect that the UK market will continue to struggle against other European peers.

Elsewhere in Europe, economies look well set, and I suspect that more capital spending and investment are likely to be incentivised with tax cuts in Europe, again outside the UK. In this scenario, those capital investment-related names such as Siemens, Legrand and Atlas Copco should continue to do well. Luxury names, and auto makers, many of which have rallied hard so far in 2017, are likely to struggle due to subdued consumer demand. Financials have also seen mixed performance so far, with insurance underperforming banks. This seems an anomaly given the paramount importance of long-term savings to cater for retirement.

It would be entirely healthy for European markets to drift through what will hopefully be a quiet summer, without shocks such as Brexit to contend with. I think all seems well set though for European markets to trade higher than current levels by the end of 2017.

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