On February 3, 1960 British Prime Minister Harold Macmillan addressed the South African Parliament and noted “the wind of change is blowing through the continent.” This astute recognition of upcoming independence movements in Africa would become a polarising subject for years to come.
“Wind of change” was also a power ballad by the German rock band, the Scorpions. The smooth, lung gripping vocals would go on to sell 14 million copies and become the anthem for political change in Germany and the Soviet Union. Powerful stuff indeed.
Of course, as everything happens in three’s, the Scorpions could be on the verge of collecting even more royalties perhaps in as little as two weeks from now. The May elections to the European Parliament are rapidly approaching and the unexpected is about to become the expected.
IceCap Asset Management: Wind of change
First a little background.
Nothing in Europe is ever simple. The political structure of the European Union is so complicated that it would make neuroscientists blush. Our June 2012 publication “Cool things from Europe” detailed the distinct lack of common sense in most things put together by the European Union.
Perhaps the best example of the absurdity behind the money eating machine in Brussels is demonstrated by the 26,911 word document stipulating the rules for selling cabbage across the old world. By comparison, the entire US Constitution with all 27 Amendments only used 7,818 words.
Politically, the European Union currently consists of 28 individual countries, each with their own democratically elected governments. Adjacent to national governments, each country also elects officials to the European Parliament. It is this European Parliament that sets the rules for selling cabbage, amongst other things.
Until recently, few cared about EU Parliament Elections. With voter turnout routinely less than 20%, the only people who really cared were those who stood to benefit, everyone else went about their own business and complained about local politics only. Brussels was irrelevant – until now.
The ongoing European debt crisis has produced wild political swings with some countries seeing jaw-dropping shifts from capitalism to socialism, and others seeing the reverse. Yet, after 5 years with no economic improvement from either political stand, people are becoming a tad restless and are beginning to search for political alternatives from the main stream parties. And the upcoming EU Elections are proving to be the perfect platform for disgruntled voters to voice their displeasure.
In the United Kingdom for example, the United Kingdom Independent Party (UKIP) has just vaulted to the top of the polls. This eclectic group certainly has a few polarising views that causes anyone at anytime to turn their heads with a grimace. Yet, it is their adamant stance that the EU is a complete waste of money; draining jobs away from local lads, as well as enriching an elite few in the bureaucratic heaven called Brussels that is drawing support.
Whereas a few years ago, this group barely registered in the polls, today UKIP has claimed over 38% of voters intentions compared to just 27% and 18% respectively for the rather very traditional Labour and Conservative parties.
The UKIP party is lead by Nigel Farage and truth be told, this fella has turned into somewhat of a folk hero standing against everything the EU shouldn’t be. Mr. Farage himself is currently a Member of the European Parliament and his regular and eloquent criticisms of the very organisation that pays him his weekly cheque can be found on any YouTube search. It is well worth spending a few minutes listening and watching.
Yet, once you peel away Mr. Farage, the rest of the UKIP party wears very thin with many inconsistent and insulting views. Depending upon the day of the week it may or may not even have an official party platform.
Within London, the mere mention of UKIP draws snickers and disapproving sneers. Yet, outside of the global financial super city, UKIP is very popular. It stands for the man on the street and this is the reason why it has earned space within our global market outlook.