Same-sex Marriage Makes Huge Progress

There has been a flurry of activity lately when it comes to same-sex marriage. Last month New Jersey became the 14^th state to legalise same-sex marriage following a court ruling. On the 23^rd of October the New Mexico Supreme Court heard arguments around whether or not same-sex marriage was legal in the state. The court has said that it will rule I the coming months. Great news came out of Illinois and Hawaii as both states are on track to legalise same-sex marriage. Governor Pat Quinn of Illinois has said that he’ll sign a same-sex marriage bill into law on the 20^th of November. Governor Neil Abercrombie of Hawaii said he will sign the corresponding Hawaiian bill after the state senate votes on it a second time. In Oregon the gay rights movement only needs 6,286 more signatures to put same-sex marriage on the ballot in November in 2014. Ohio also has a petition to legalise same-sex marriage but unfortunately they have no revealed how many signatures they have gotten. In Michigan a district court judge has agreed to hear a case challenging the constitutionality of Michigan’s same-sex marriage ban in February 2014. Suits have also been filed in Arkansas, Kentucky, Texas and Pennsylvania. Following their success at defeating the same-sex marriage ban in California, the American Foundation for Equal Rights has stated that its next target will be Virginia.

In Australia, the Australian Capital Territory (aka Canberra) became the first Australian jurisdiction to legalise same-sex marriage. Unfortunately the conservative government has said it will try and block the legislation. More good news came out of Ireland where the government announced that a referendum would be held in 2015 on the issue of same-sex marriage. It is almost certain to pass, when this happens Ireland will become the first country to legalise same-sex marriage through a referendum. Ireland is one of only two European Atlantic Coast countries to not have legal same-sex marriage (the other being Germany), although several sub-national jurisdictions have also not legalised it.

In the Scottish Parliament the bill to legalise same-sex marriage passed through the Equal Opportunities Committee very easily and now awaits a vote by the main parliament. It will have to go through three more votes before it actually becomes law.

A Symbol of Reconciliation

Today was a historic day in Northern Irish politics. Martin McGuinness, ex-commander of the IRA, shook hands with Queen Elizabeth II.

Even a few years ago this event could not have happened, but ever since 1998 relationships have become amicable and tensions seriously reduced. The visit by the Queen to the Republic of Ireland in 2011 (the first since 1911) and her visit to the Garden of Remembrance in Dublin, where she laid a wreath in memory of those who fought against the British for Irish Independence, helped to further cool relations between Republicans and the Monarchy.

The public, including hard-line Republicans and hard-line Loyalists, seem to be largely delighted with the handshake. Both sides recognise that normality may finally have come to Northern Ireland after almost 100 years of violence and trouble.

The Queen and Martin McGuinness shaking hands

Yet there is still work to be done, Northern Ireland is far from perfect, to move forward Northern Ireland needs investment and new infrastructure. In moving forward the past should be left behind, but not forgotten, so we can build a better, brighter future for Northern Ireland.

The Fate of Europe in the Hands of the Irish

Polls in Ireland have just closed, turnout looks like it is extremely low possibly below 50%. The no campaign is led mainly by Sinn Fèin, whereas most of the political establishment is rallying behind the yes campaign, including the government and most of the opposition.

The no camp argues that agreeing to this is basically handing over Ireland’s independence to bureaucrats in Brussels and Berlin. Many on that side also believe that the limits on a budget deficit would prevent Ireland from leaving austerity and recession; they believe that the Irish government should be spending to create jobs and eventually help Ireland recover.

The yes camp believes that by voting for the new treaty will allow Ireland to get a second bailout from Europe, should it ever need it. They mostly also believe that austerity is the way to get Ireland out of the crisis and a budget deficit will not help Ireland’s economy grow.

So the results tomorrow will be waited on patiently across Europe and indeed the world, if Ireland votes no it will be difficult to grasp the magnitude. As Ireland is in the Eurozone it will make things more difficult for Merkel and other austerity leaders. It will also be welcomed in Greece, as this may prompt a new and more lenient treaty that would be of great benefit to Greece.

The Never-Ending Woes of the Eurozone

The never-ending Eurozone crisis has reached a new low today with the cost of borrowing for Spain rising to almost record levels, just a whisker below 6.7%. Tomorrow is also going to be an important day for the Eurozone, the Irish are going to the polls tomorrow to vote in a referendum on the new EU fiscal compact treaty. If the Irish reject the treaty, it will send shockwaves throughout Europe likely destabilising Greece and Spain even more.

More discussion has focused on the likelihood of Greece leaving the Eurozone. The Economist Paul Krugman who has written a book on, what he calls, an economic depression is becoming increasingly visible. He claims that a Greek exit would be “awful” for the world economy and that Greece may never recover, he believes that the austerity imposed on Greece and other Eurozone countries simply is not working. In the UK he is calling for the government to use the record low borrowing costs to borrow money to fund infrastructure projects and help to boost the economy.

Krugman has claimed that the crisis will send the world economy into chaos and he believes that if the leaders of Europe want the euro to survive there must be some form of political union. Although this appears unimaginable it does make sense, a political union would make it easier to spread the wealth around and allow Greece and Spain to become competitive again.

So what are the risks for the UK? Well we have very little exposure to Greece itself, but the fear of contagion if Greece defaults or leaves the Eurozone puts us at bigger risk. The exposure to Italy and Spain for Barclays, RBS and HSBC is about €10 billion each, but RBS’ exposure to the Eurozone as a whole is €70 billion. If Greece defaults and leaves the Eurozone it will have catastrophic consequences for the Eurozone. Krugman believes that unless Merkel and the Germans concede defeat and allow the Greeks to have more lenient austerity a Greek default is inevitable. 

US economist Paul Krugman