Gibraltar and the Falklands deny the logic of history

These relics of empire pay hardly any UK tax – but when the neighbours cut up nasty, they demand the British protect them

• 
• • Simon Jenkins
  • The Guardian, Wednesday 14 August 2013

La Linea. ‘People living in the colonies have a right to be considered, but this has never overridden political reality. Photograph: Oli Scarff/Getty

Nothing beats a gunboat. HMS Illustrious glided out of Portsmouth on Monday, past HMS Victory and cheering crowds of patriots. Within a week it will be off Gibraltar, a mere cannon shot from Cape Trafalgar. The nation's breast heaves, the tears prick. The Olympic spirit is off to singe the king of Spain's beard. How dare they keep honest British citizens waiting six hours at Spanish border control? Have they forgotten the Armada?

The British empire had much to be said for it, but it is over – dead, deceased, struck off, no more. The idea of a British warship supposedly menacing Spain is ludicrous. Is it meant to bomb Cadiz? Will its guns lift a rush-hour tailback in a colony that most Britons regard as awash with tax dodgers, drug dealers and right-wing whingers? The Gibraltarians have rights, but why British taxpayers should send warships to enforce them, even if just "on exercise", is a mystery.

Any study of Britain's currently contentious colonies, Gibraltar and the Falklands, can reach only two conclusions. One is that Britain's claim to them in international law is wholly sound, the other is that it is nowadays wholly daft.

Twenty-first century nation states will no longer tolerate even the mild humiliation of hosting the detritus of 18th- and 19th-century empires. Most European empires were born of the realpolitik of power, mostly the treaties of Utrecht (1713) and Paris (1763). The same realpolitik now ordains their dismantling. An early purpose of the United Nations was to bring this about.

Of course those living in these colonies have a right to be considered, but such rights have never overridden political reality. Nor has Britain claimed so, at least when circumstance dictated. The residents of Hong Kong and Diego Garcia were not consulted, let alone granted "self-determination", when Britain wanted to dump them in the dustbin of history. Hong Kong was handed to China in 1997 when the New Territories lease ended. Diego Garcia was demanded by and handed to the Pentagon in 1973. The Hong Kong British were denied passports, and the Diego Garcians were summarily evicted to Mauritius and the Seychelles.

Britain's security does not need these places. It does not depend on coaling stations in the Atlantic. France survives without any longer owning Senegal and Pondicherry, and Portugal without São Tomé and Goa. When the Indians seized Goa in 1961, the world did not object. Indeed the Argentinian invasion plan for the Falklands in 1982 was called Operation Goa, as Buenos Aires assumed it would likewise be seen as a post-imperial clear-up.

Relics of the British empire now mostly survive in the interstices of the global economy. They are the major winners from the fiscal haemorrhage that has resulted from financial globalisation. Many have become synonymous with sleaze. American tax authorities wax furious over Bermuda. George Osborne is out to get the tax dodgers of the Caymans and British Virgin Islands.

Spain has long held grievances over Gibraltar's role in aiding people smuggling, money laundering and offshore gambling beyond its own regulatory reach. This culminated in a 2007  IMF report on shortcomings in the colony's financial regulation. Gibraltar's status as a tax haven has brought it surging wealth, fuelling Spain's rage at so much money pouring untaxed through what it regards as its own territory.

Such colonies claim to be "more British than the British", except that they pay no UK tax and act as tax havens for funds from Britain. Gibraltar has made a particular specialism of internet gambling. Colonies claim allegiance to the crown, but not to its exchequer, or its financial police. They are Churchillian theme parks of red pillar boxes, fish and chips and warm beer. But they want the smooth without the rough. When the neighbours cut up nasty, they demand that those whose taxes protect them should send soldiers, diplomats and lawyers to their aid.

The legal argument between Britain and Spain is in Britain's favour. Though Britain failed to join the Schengen area with free border crossings, all EU states supposedly ease the movement of their citizens. Spain's proposed £43 admission charge is excessive. It might seem ironic for Tory ministers to plead their cause before the hated European courts, but that is the right place to go. Law-law is better than play-acting at war-war.

That said, it is beyond belief that an honest broker could not resolve this centuries-old dispute. Britain has, on several occasions, sought a compromise deal on Gibraltar's sovereignty. Thatcher initiated talks in 1984, after successfully settling both Rhodesia and Hong Kong. The Spaniards offered Gibraltar fully devolved status, like the Basques and Catalans, respecting language, culture and a degree of fiscal autonomy. As Hong Kong has shown, sovereignty transfer does not mean political absorption.

The curse has been Spanish ineptitude feeding Gibraltarian intransigence. Border hold-ups are counterproductive to winning hearts and minds, as were blundering Argentinian landings on the outer Falklands. Spain demanded sovereignty now – despite itself having colonies in north Africa. This pushed British governments to the wall and made them vulnerable to colonial lobbyists wielding the demand for self-determination. A 2002 Gibraltar referendum gave 98% support for continued colonial status – a Falklands vote gave a similar result. It's a far cry from Thatcher's readiness to surrender Hong Kong and accept "sovereignty with leaseback" from both Madrid and Buenos Aires.

The truth is that Britain's tax-haven colonies feel more secure than ever, blessed by history with British protection and free to skim the dark side of the global economy for cash. This has bred a tribe of gilded "Britons" who live in a perpetual other-world. When I asked a Gibraltarian who claimed to be "150% British" why he should not at least pay 100% British taxes, he replied: "Why should I pay for people thousands of miles away?"

While they deny the logic of history and geography, neither Gibraltar nor the Falklands will ever be truly "safe". One day these hangovers will somehow merge into their hinterlands and cease to be grit in the shoe of international relations. This day will be hastened if world governments take action to end tax havens.

Meanwhile, the inhabitants of Gibraltar can go on voting "to stay British" as long as they like. But if they do not accept the taxes and disciplines most Europeans accept, while sucking business from Europe's financial centres, they can hardly expect one EU state to protect them from another. An occasional six-hour queue at La Linea is a small price to pay for declining to join the real world.

• This article was amended on 14 August 2013. It originally stated that the US department of state had called Gibraltar "a major European centre of money laundering". In fact, it was referring to Spain. This has now been corrected.

Saving Pakistan... And India?

Omar Ali

Pakistan is in the throes of an existential crisis. Pakistan has always been in the throes of an existential crisis. Pakistan’s interminable existential crisis is, in fact, getting to be a bore.  But while faraway peoples can indeed get away from this topic and on to something more interesting, Pakistanis have little choice in this matter; and it may be that neither do Indians.
The partition of British India was different things to different people, but we can all agree on some things: it was a confused mess, it was accompanied by remarkable violence and viciousness,  and it has led to endless trouble. The Paknationalist narrative built on that foundation has Jihadized the Pakistani state, and defanging that myth is now the most critical historic task of the Pakistani bourgeoisie.

Well, OK. We don’t actually all admit any of those things, but all those are things I have written in the past. Today I hope to shed my inhibitions and go further.

First, the crisis. Some friends think I am being unnecessarily alarmist and the only crisis is the presence of American infidels/imperialists in the region. Let America leave and all will be well. Others believe that if the army had a “free hand”, they would have things under control within days.  Let us dispense with both theories. The crisis is not primarily American generated (though they have a long and glorious history of feeding dollars to the crisis) and no one is in complete control.  The existing corruption-ridden state is a British colonial creation struggling to get by alongside an unstable mix of Islamist ideology and a very shallow and self-contradictory foundational myth. Even though the karma of the Raj is potent stuff, it will not last forever against these forces. When it goes, the next step will not be the dawn of Chomskyan enlightened anarchy or democratic socialism; it will either be Salafist Islam or the dissolution of the state. Dissolution being physically and diplomatically difficult (who will handle the scramble over borders that would follow?), Salafist Islam administered by the army (perhaps with a charismatic cricketer as its public face) is the likely option.

Unfortunately, it is not likely to work very well. In fact, it is incapable of sustaining even the bare minimum of modern statehood. Unlike Iranian Islam (which is literate, modern and sophisticated compared to Salafist fantasies) there is no there there.  A militarized salafist Pakistan may hold together a few years in the name of war against the infidels, but after the war (and who wants a war that could go nuclear?) we are left with little more than the vague notion of a rightly guided caliph, the whipping of uppity women and the accelerated cleansing of undesirable smaller sects. After all, if you have a religious state, then you cannot have ten different interpretations of religion (not to speak of ten different religions). Which vision is in charge has to be clear. The state must enforce religious uniformity or become secular. There is no third option.  One can see this principle in operation in Pakistan ever since General Zia started Islamizing in earnest.  Ahmedis were already beyond the pale, but Shias, a sect that provided the founder of Pakistan and were an integral part of Pakistan, now face the prospect of second class citizenship or worse. If you happen to believe in the Salafist project you may find this a desirable endpoint, but everyone else will want to stop this process and reverse it if possible.

To stop short of that particular landing, we have to repair what we have. What we have is very confused and the current “approved” mythology of Partition and an Islamic state serves to increase confusion and undermines what exists. That approved mythology therefore has to be set aside or defanged. This does not mean there are no other problems. There are tons of other problems, and many of them are bigger than salafist Islam in a worldwide context. But those problems are common to the whole region. They are common to the third world. They are even common to the rich countries. They are problems of power arrangements, of unbridled capitalism, of environmental degradation, of  individual alienation and so on. They are, in short, problems of where humankind is in the 21^st century. There are many different approaches to these problems and many different solutions, precisely because we have not yet solved them. But there are other problems that were identified and solved centuries ago. For example, we moved on from the divine right of kings, the segregation of women, even the revolutionary vanguard and national socialism. The notion that we can have a religious state but somehow bypass the known problems of the religious state is not  tenable. But a salafist coup will be just that. The world has moved on, we will have to move on too.

While this explains why Pakistanis need to worry, what about Indians? With enough problems of their own, why should they care two hoots about all this? I think they will have to care because there are clear limits to how far Indians can downgrade the importance of whatever craziness is going down in Pakistan.  IF we go down, we will take a lot of people down with us. India is not protected from the fallout by two oceans or even the high Himalayas. If Pakistan crashes down to Taliban level, India will have to scramble to avoid the fallout and given the realities of geography and the capabilities of the Indian state, that is not a job they can do very well.

There is also a second reason why Indians should worry a little about what happens in Pakistan. India itself is a work in progress. Its integration of British India, modern democratic forms and the ancient but scientifically underdeveloped and culturally heterogeneous civilization of India is not a done deal.  It is easy for commentators to “discover” that India on the ground is not as different from Pakistan as Indians may wish it to be.  I am aware that there are differences and they are real; the stated ideal is superior, the historic basis is sounder, the religious landscape is too heterogeneous to even imagine monocultural purity, the dominant religion is Hinduism and so on; but the existing reality of everyday life is still very far from the ideal. While neither economic development nor democratic rule nor national integration are in imminent danger,  none of these are out of the woods. If Pakistan heads for salafist Islam, India will face not only terrorist attacks or overt hostility, it will find its own problems and weak spots revealed and exploited at a time when it needs to pretend it has moved beyond them in order to actually move beyond them.   

The rational choice therefore is for India to help prevent such an outcome. And luckily, there is much that India can do in that direction.  Trade with India has the potential to transform the economy of Punjab and beyond. Transit to Afghanistan and central Asia will double that dividend. And travel and cultural exchange with India undermine the entire paknationalist narrative (which is why Hafiz Saeed and other Jihadist leaders have been launched to try and stop any such initiatives). While it would be a mistake to get carried away with the possibilities it would also be a mistake to miss opportunities just because the Indian-nationalist narrative emphasizes the differences.

This sort of argument is very infuriating to some Indians (it also makes Paknationalists go ballistic, but I lost that constituency at paragraph two).  To be asked to help not because we are fellow human beings or long lost brothers (we already have that group of Indians lighting candles at Wagah border every year and I love them for it) but because if we really truly catch fire we could set the whole neighbourhood aflame? It sounds almost like blackmail. “Internet Hindus” will obviously want no part of this, but even mainstream analysts can be sceptical; but dear think-tankers, think about it. Trade, travel and cultural exchange with India are the least expensive and most “high-return” means of saving Pakistan from a salafist catastrophe. Realpolitik, not sentimental humanism (I personally approve of sentimental humanism, but that is a separate matter) suggests that India actively take steps to prevent Pakistan from going down to the next level. Realpolitik also suggests that it is still possible. Pakistan is not the basket case it is sometimes projected to be; it is a fertile land with hardworking, enterprising people; a large economy with real possibilities of trade and investment; its ancient Indic cultures and shared Indic languages are still alive and provide a basis for deep interaction. India can open channels to help an alternative national myth to take root and survive in Pakistan even as it takes precautions to wall off harmful trends. Without some deft assistance (and precautionary walling off, the two contradictory trends will have to go together; it is crucial to know which approach is needed where) the “good” side is more likely to go down.

The other big player is, of course, Uncle Sam. But that will have to be the topic of another article. Paknationalists had also set their hopes on Uncle Chin, but that may be wishful thinking.