Tag Archives: EU

European Disorder.

Reviewing Prof Simms New Statesman article 24-30 November 2017.

 

JR Max Wheel

30 November 2017

 

Amongst the near endless name-calling and brickbats over Brexit in the UK, a very interesting and insightful article appeared in the New Statesman this week, written by Prof. Brendan Simms, from the University of Cambridge’s politics and international studies department.

Since the UK remains so deeply divided on this issue, it is good to have a take on the EU which throws some light and not heat.

 

Most mainstream media outlets have pinned their colours to the Leave or Remain mast and hence are even less trustworthy than normal as sources of information, but have degenerated into presenting emotive and deliberately slanted presentations- click-bait.

 

Simms points out some important messages, one, that populism far from going away is now rife in many (most) member states, sometimes powerfully so, whether in the splintering of a broad political consensus; Germany, Austria, the Netherlands and Greece have suffered from it as well as the UK. Poland and Hungary are in near open revolt at EU rulings from Brussels. Worse still, there is now a strong regional identity issue in Spain over Catalonia, the North in Italy, as well as the ever-present issues between Walloons and Flemings in Belgium. This is disturbing as the EU was supposed to have substituted the nation state with the prospect of an overarching federal Europe. That now looks impossible. The creation of the Union to supplant the nation state was never the foregone conclusion that many of its proponents believed. Indeed, as Simms argues powerfully far from transcending the nation state, the EU has thrown a lifeline to it after a near death experience in two world wars of the 20th.C. De Gaulle viewed the Union as a “L’Europe des Nations”, not what its founding fathers envisaged at all.

 

Suddenly regions matter as well as nations. This is a unique achievement, the EU has spawned the very opposite of what it promoted, a “Balkanisation” of Europe instead of a cohesive Union.

 

In large part this stems from its messy single currency, which has aggravated many of the underlying economic issues between members since the Crash of 2007/8. This has driven up unemployment, meant that achieving competitive balance is impossible and works only in favour of the most advanced and productive countries, especially Germany.  So, we have a common currency and a common travel area administered by a de facto confederation, not a federation, and on frequent occasions, an agenda driven by a key member State, Germany or in the past, France. The founding Franco-German axis may rebalance or not, what is certain is that the status quo cannot persist in an era of mass migration, globalised trade in goods and services. Many parts of the EU economy are still not open, in services especially, but also in the protectionist tariff wall, which also masquerades as a harmonisation of standards. Such standards largely emanate from UNECE anyway and are transcribed into EU law.

 

Large swathes of industry in individual member states have languished economically, the economic decline being mirrored by the rise of an angry electorate, ready to punish its leaders for falling to recognize the economic damage or seeming to care much about it.

 

It is worth looking at the problem of post-election politics in Germany.  After 12 years in power as Bundeskanzelerin, Angela Merkel seems vulnerable. Never a political visionary, Merkel was always a cautious political manager, seeking a consensus, when she did act decisively according to her instincts, in opening the borders to a massive immigration wave, it spectacularly rebounded threatening to stymie a largely cohesive system. The Centre Right CDU/CSU party and the Centre Left SPD have been outflanked to the left and right. Far from being the bastion of free trade and stability in the wake of what is painted as populist upsurges in the UK and US, she is likely to be overwhelmed by it. Simms also uses an interesting analogy for these times, that of Klemens von Metternich, Austrian Chancellor after the Napoleonic Wars. Metternich’s aim was to stifle uprisings, contain radicalisation and revolutionary movements until it hit the buffers of the 1848.

 

Brexit was never the real catalyst for a break-up of Europe, even if some of its wilder promoters desired it, it was always the underlying political and economic factors affecting real people.

 

There are only a few choices, accept that there are limitations to the Federal Project as conceived or to try to forge a smaller and consensual European Union, which may have to be a lot smaller and economically, and politically cohesive. Even that is unlikely to be acceptable or sustainable without deep-rooted changes.

 

Uncomfortable Euroland thoughts!

written and posted by Graham Reid

March 29 2016

Schauble/Germany think they run the EU – they probably do – don’t tell France!

 

Marr TV interview: March 2016

 

Andrew Marr: But isn’t it possible for the UK to have the advantages of the internal market, the single – the single trading area, without paying in and without accepting free movement of people?

 

Wolfgang Schauble: No, you are either in the single market or you are not in the single market. And if you’re not in it, then you have trade arrangements. Of course there are countries within Europe that are part of the single market but they still have to pay into the budget of the community and they have to accept the free movement of people. So actually they have all the disadvantages of the common market and they are not involved in the decision-making process of the internal single market.

 

Germany and Greece

 

Germany, the Euro-zone’s effective paymaster, has demanded fiscal discipline and tough economic reforms in Greece in return for extending repayment deadlines and new financial support. Finance Minister Wolfgang Schauble opposed a Greek debt write-down, pointing to his own government’s balanced budget.
July 12 2015

 

Sunday’s statement on Greece by eurozone finance ministers will go down as one of the most brutal diplomatic démarches in the history of the European Union, a bloc built to foster peace and harmony that is now publicly threatening one of its own with ruination unless it surrenders. The IMF has urged Europe to give Greece some debt relief, something Berlin has opposed. Its only remaining option for disobedience—to default and leave the euro—would satisfy rather than horrify many of its European critics, led by German Finance Minister Wolfgang Schäuble.

 

April 3 2015

 

For the first time in public, though practically the entire world assumed it, an official from the IMF has admitted that the various Greek bailouts were not for The Greeks at all…“They gave money to save German and French banks, not Greece,” Paolo Batista, an Executive Director of the International Monetary Fund told Greek private Alpha TV on Tuesday.

 

 Security

 

Michael Hayden, former head of the CIA has said a British exit from the EU would have little impact on the UK’s security. He described the European Union as not a “natural contributor to national security” and that relations between Washington and London would not be affected.

 

Sir Richard Dearlove, a former head of MI6 has said Britain could be more secure outside the EU, countering David Cameron’s attempts to put security at the heart of the remain campaign.

 

We are told that our fingerprint knowledge and other security exchange would be jeopardised. Will Germany tell 26 countries that they can no longer have the information from the UK/GCHQ that currently protects them?

 

Trade Deal

 

Norway gets a better deal than Britain currently does, and Switzerland a better deal than Norway. But a post-EU Britain, with 65 million people to Switzerland’s eight million and Norway’s five, should expect something better. The deal on offer is based on free trade and intergovernmental co-operation. We’ll recover our parliamentary sovereignty and, with it, the ability to sign bilateral trade deals with non-EU countries. The idea that either side would wish to jeopardise the flow of cross-Channel trade is bizarre.

 

Time to finalise a trade deal

 

We are told 7 to 10 years is normal! Will German/other EU companies allow Germany to stop them trading with the UK for that long? As long as Germany stalls. The UK can too. If Germany imposes punitive tariffs and regulations, the UK can too. Deals are 2-way.

 

UK citizens working/living in the EU

 

The frighteners tell us they would be denied local services (health, schooling etc.). Is Germany going to force the UK to deny French/Spanish/Italian & German citizens to be denied UK services? UK workers are going to be sent back to UK. Does Germany want the UK to deport all EU citizens?

 

Immigration

 

Each country needs to ensure that they have the infrastructure – housing, schools, health facilities, transport and security – to accommodate their population and the people with the needed skills. Immigrants, regardless of nationality, colour or creed should be welcomed provided that the UK has the infrastructure capacity to absorb them and possess the skills it needs.

 

Immigration decisions should be the sole preserve of the host country NOT prescribed by others.

 

Sovereignty

 

If the UK has adequate sovereignty, why did it the PM hundreds of days, flying thousands of miles to negotiate the inadequate deal he secured? Unelected EU Commissioners decide what we can and cannot do. Why does the EU Court of Justice have the ability to overrule UK Courts decisions?

 

UK Jobs

 

BREXIT would result in thousands of lost UK jobs! The UK pays £13 billion, net of the rebate, into the EU each year of which £4.5 billion comes back in subsidies, mostly for agriculture, to be spent as  the EU directs. The UK could continue to subsidise its farmers with £4.5 billion BUT on terms agreed with and suitable to the industry and still have £8.5 billion to generate more jobs and invest in the National Health Service and infrastructure.

 

“Better the devil you know…”

 

The uncertainty is with staying in, not BREXIT. Germany, with France and other Eurozone members will inevitably – and correctly from their point of view – introduce laws and regulations that protect the Euro and move that zone to ever closer union. The UK and other non-Euro States will still be subject to those rules and no-one has said, and will not, how they will impact the UK and others. With BREXIT, the UK will determine its own rules to suit itself not 19 + other countries.

 

Terms & conditions post BREXIT

 

Deals are 2-way. For every threat the UK receives, it could insist on reciprocal terms from the EU. Fear of the future is misplaced unless there is no confidence in the UK’s abilities. The UK was a major international player for hundreds of years before the EU and would be post a BREXIT decision.

 

The EU gets it wrong on migration.

JR Max Wheel

9 September 2015

Act in haste, repent at leisure. The EU approach to migration and its management has proved to be mistaken, muddled and inadequate. Mainstream media has played its part in a near hysterical campaign to galvanize member states into reaction as the near endless stream of unfortunates turned into a flood, flowing out of a variety of countries. Naturally the focus has largely been on Syria’s ghastly civil war and its homeless victims, many of whom can no longer sustain themselves between the twin evils of ISIS and the Assad regime. The West’s response post Iraq, Libya and Afghanistan has been unsurprisingly meek and unimaginative: a mix of Special Forces’ activities, localized bombing and drone strikes. This is both a real civil war and a proxy one played out between Syrian factions, and  its role as a  client state of Russia, Iran and opposed by the Saudis and others. The policy failures are numerous and dire, some go back well beyond the Assad regime and the century old post-war settlements for Syria and Iraq: it is easy to criticize but these were disparate provinces under the Ottomans, so re-drawing maps was never going to be easy or fair to the mix of regions, and ethnicities.

 

We now know that the flow is made up of refugees from all parts, migrants from the Balkans, Eritrea, Libya and the Sahel. The only common factor is the desire to escape at near any cost. This is not entirely a new problem as the Italian coast guard knows – they have been fielding this problem for years as migrant boats have sunk or washed up on Lampedusa, Sicily and on the Greek Islands as the broken Greek (and EU) border system struggles to cope. Choke points have also existed in Menton and Calais (hardly recent). Europe, in the form of the EU is seen as a both a safe refuge and a chance to make a new start; it is also a source of a safety net in the shape of EU country benefits systems, which if they are to work require a serious degree of control. The EU’s much vaunted four freedoms,  of people, capital, goods and services are now becoming a ball and chain since they were designed for a different world, one where there was less impact from globalisation and mass movement. The EU is not a nation-state, no matter how many might have that aspiration and is unlikely to become one anytime soon. Nonetheless the President of the Commission, Jean-Claude Juncker has announced emergency measures which impose a compulsory quota scheme on its member states: this overrides national parliaments and has already produced a backlash in former Central Europe, Poland, Hungary, and the Czech and Slovak Republics. Many EU countries are already suffering high levels of youth unemployment, high debts and considerable economic pressures. True these may be nothing when compared to the suffering of the migrants, but they set up a potential clash of cultures. Reaction from Central Europe is unsurprising given an historical clash with the Ottoman Empire. There is likely to be little cultural cohesion, or comprehension in host countries. Most bizarre of all has been the reaction of Germany, which has committed to take some 800,000; at one level this is a simple re-balancing of an ageing population, in which case why not have an organized system to select those who can assimilate or have necessary skills. Or is its action an identity crisis driven by Germany’s problematic past? Whatever the motives and in part it has to be seen in providing some relief to the hard pressed Greeks and Italians, this sends a signal that Europe’s borders are open. Indeed they appear to be, since neither the Dublin Agreements nor Frontex systems provide an adequate external border system. Once inside there is a heartless and cynical movement between countries as migrants are allowed or encouraged to travel under the Schengen agreement- the free movement of people, (viewed as sacrosanct) to the country of choice.

Chart showing UK migration over time

Courtesy of the BBC

This is a hopeless system and needs urgent overhaul. Britain, so long a major contributor via foreign aid has been pilloried for failing to commit to take more. This is to ignore the net economic migration from both non EU and EU sources over the last ten years, which is well over three million. This too is unsustainable. The perception is that Britain is both contrary and mean-minded, neither is true as the generosity of Britons to nearly any natural catastrophe testifies. Cameron is right to stress that this is a crisis that demands engagement of the head and the heart. It will be hard to maintain a semblance of EU unity if it remains rule by diktat.

 

What defines Europe? Why it matters and why the EU needs a proper foreign policy framework

JR Max Wheel & Graham Reid

18 Feb 2015

Where does Europe stop and start? This seems like a trivial question, but it is one which  needs asking, most especially in view of the eastward drift of the European Union and the turmoil in the Ukraine. It is not easily answered. If one looks at how the European Environment Agency (EEA) tries to address it, it is a mix of geography, geology, ethnography and broadly includes the almost everything west of the Ural mountains, no doubt the Russians would disagree in any context beyond a purely geographical framework.

 

Map1Acknowledgments: European Environment agency Eurasian Landmass

It is a truism of history that empires do not last, but they fade or are swept away by violent events;  European history is littered with vanished kingdoms and states, brilliantly documented by British historian Norman Davies in his excellent “Vanished Kingdoms”- the half-forgotten Europe of near myth.

 

Unfortunately in today’s Europe the European Union itself is perceived as having its own “imperial” agenda, The Push to the East[Drang nach Osten], which has hit the buffers of political reality in Ukraine. The desire of [particularly West] Ukrainians to a closer arrangement with the EU has stirred a violent reaction in its Eastern borders. This is unsurprising; the slightest familiarity with Russian history reveals it paranoia over defensible borders, frequently secured via control of buffer states. Intriguingly it is suggested that even prior to the collapse of Berlin Wall in 1987 both Gorbachev and Kohl had discussed conditions for German reunification to be agreed, provided there was explicit recognition that the Baltic States, Belarus and Ukraine were excluded –i.e. recognized as being within the Russian “sphere of influence”. Clearly this was an attempt to avoid the stigma of a Germany remaining as an economic giant but a political pygmy: such notions did not play well with the French, as the Quai d’Orsay clearly feels it has a near monopoly over the requisite diplomatic skills. Whether this Russo-German policy actually was ever enshrined in document form, is irrelevant as events overran policy. What it does serve to show was that Gorbachev was very clear that the sphere of influence ideas were (and are) still significant and that encroachments eastwards were going to be looked upon with suspicion and quite probable interference. The subsequent collapse of the Soviet Union put history on temporary hold; it also opened up a historical opportunity. The old Yalta Accord had already begun to splinter, as Poland, Hungary, the Czech and Slovak Republics and the Baltic States all joined forces with the EU as members and are further extended to Romania and Bulgaria.

Europe 1970: Acknowledgement: Erols/MSmith

 

Map 3

Ukraine declared its independence from the former USSR in 1991: by 1992 some 128 states recognized Ukraine as a sovereign state. The emerging Russian Federation was in no position to act contrarily because it too had recognized Ukrainian sovereignty and was economically weakened.

 

Amongst the hangovers remaining from Yalta are the enclave of Kaliningrad, formerly Königsberg in East Prussia and the unreformed State of Belarus, still wedded to the old USSR both politically and economically. Little real progress politically was made in Ukraine until the Orange revolution 2004-5 although the stand-off between reformers and old style pro-Russians like Yanukovich was played out amidst a chaotic and massively corrupt system. By then it was clear that the path to a democratic and market economy was going to be far from easy.  By the time of Yanukovich’s election in 2010 and the outbreak of protest in 2014, the essential divisions between a pro-Russian East and a pro European West would begin to tear the country apart. It has always been a policy for absolutist rulers to seek to destabilize in such circumstances by claiming that minority ethnic Russians or pro-Russian supporters were “at risk” and the rest is the history of infiltration, violence and compromise of Ukrainian sovereignty.

 

Prior to these events the EU had used its Partnership agreement of 1998 and Association agreements of 2007-11 to negotiate an ever closer rapprochement between Ukraine and the EU. Given that this went much further than trade but included energy security and the text for military and defence cooperation, virtually nothing was more likely to inflame passions on both sides. Such stumbling and toxic diplomacy engendered the current situation as much as Russian desires to keep Ukraine firmly in the orbit of the Russian Federation. Logic and a sense of history should have demanded caution by the EU. This is Eastern Europe proper and not occupied Central Europe and the cultural and political sensitivities are very different. In short the hard men like President Putin have made it clear, ” so far and no further”. Yet this is a sovereign state. Such is the degree of political naiveté that dogs EU foreign policy as well as the deals done behind closed doors the word incompetence is inadequate to describe this ineptitude. The same “fix it as we go along” stratagem  is evident in the way the EU has dealt with its currency crisis, itself a monument to political manipulation and hubris

 

It is clear total overreach by the EU; whilst few would entertain for a second the destabilizing and revanchist behaviour of the Russians, it is broadly similar to the sensitivities of the US over Cuba too close for comfort. That this kind of “policy making on the hoof” is viewed as an innocent technocratic deal is acceptable in a Union of 28 nation states is itself highly questionable. The original 6 EU members were of course all Western European and thus at least shared some cultural identity and shared ambition, the 28 do not remotely fit that picture, the blood-soaked history of much of Europe is due to the subversion and not infrequent upsurge of tribal grievances amid Great Power Nation States. As such the EU would be far better engaged in assimilating the huge territorial mouthful it has already accumulated, than to risk dragging Super Power politics into another historical quagmire. This must be the lesson of Ukraine. For all its proud history, it has been attacked by Huns, a pawn in the wars of Poland and Lithuania, fell to Catherine the Great of Russia in the 18thC, overrun by the Nazis and temporarily freed in 1991: tragically it is hard to see without deep political changes in Russia, a safe and independent future.  What a tragic irony for a country that gave its name to “all the Russias” and what a warning to the EU to beware its limitations.

 

 

 

 

 

 

Europe in denial-closing ranks against Greece

by Graham Reid & JR Max Wheel
1 February 2015
The Greek situation is singularly important for the European Union, let alone its single currency. Syriza’s message needed to be said loudly and directly to a leadership in near total denial. Insolvency not illiquidity is destroying their country, its people’s welfare and way of life. Much of the same can be said for the other deeply indebted Eurozone countries.
Currencies matter, rules matter but sometimes it is as important to break them as it is to enforce them. This is one such an occasion.
Barely three years after the ink was dry on Allied-German debt forgiveness of 1953 under the US Marshall Plan, the European Economic Community’s founding treaty was signed in Rome in 1957. Greece was a co-signatory to that debt forgiveness treaty – in short, Give rather than Lend Money. 1957 was a seminal moment for Europe, for the six original member states of W. Germany (as was), Italy, France, Belgium, Luxembourg and the Netherlands but so too was its 1953 forerunner because without it W. Germany could not have possibly enjoyed its economic miracle (Wirtschaftswunder). Within it was contained Jean Monnet’s dream of a united federal Europe, echoed by French foreign Minister Robert Schuman (a Luxemburger).
Civitas summarised the counterpoint issues elegantly:
For:
The Treaty of Rome was a ticket to greater economic growth, enshrined the dream of a united Europe, would make it impossible for European countries to go to war again and was an incredible feat of diplomacy that paved the way for European reconciliation and the spread of democracy.
Against:
The Treaty set out an impossible goal of creating a united Europe by ignoring cultural and linguistic barriers that divided the continent, was fundamentally confused as it aimed to promote economic co-operation through an undemocratic and unnecessary political apparatus and the institutions that were created were distant and unfamiliar. In their original form they allowed many decisions to be made behind closed doors thus discouraging open debate and participation.
Civitas might well have gone on to argue that even more impossible than the United Europe was the creation of a common currency, [at least for some of its members], where few of the very basic conditions to ensure its stability were adopted by its members, lost in an orgy of self-congratulatory hype and overreach.
Is there anyone who still thinks that a common currency for 19 economically diverse countries can work without fiscal and financial union – a common treasury, taxation, benefits, pensions and regulatory framework with agreed disciplines and targets?
Financial journalists appear to becoming around to our long-held view that without a full union and mutualisation of debt, a functional Eurozone will remain an impossible dream.
We go along with debt forgiveness only as an immediate solution for Greece, but it does nothing for the built-in flaws of the whole Euro concept, doomed to repeat the same errors, lack of competitiveness, contrary cultures, differing economic requirements and in the Greek case, a largely offshore economy!
The forgiveness and restructuring of Greek debt, is required due to very particular factors. Who is next? Italy? Spain? Portugal? France? It is very doubtful that the ECB easing QE [in excess of 1 Trillion Euros] can cope in keeping patients alive, let alone thriving. Any solution is going to cost but let that cost be in building a stronger future, not paying for past mistakes.
BOE Governor Mark Carney said (Dublin Speech 28th January 2015):
Cross border risk sharing through the financial system has slid backwards. Europe’s leaders do not currently foresee fiscal union as part of monetary union”.
Leaders in this context are politicians who have a very different agenda to that of the real world where economic strength and competitiveness  is paramount. The self-same people have perpetuated the myth that the Euro will recover and remain a pillar among world currencies. Why deny the reality? Is the truth consistently hidden from view too hard to bear- that it was and is a dire error?
Change is not only inevitable but urgent and vital before more money is wasted on this absurd construct. It appears that there is a mood, part truculent, part reluctant, to do something, but matched by a total lack of commitment to set out a course of action to set the process of change in motion.
There are a few ways out of this mess, all with major costs and degrees of risk but is not some “risk” better than “certainty of loss and failure” if the problem is just kicked down the road yet again?
First , there has to be is an admittance, by member countries Germany, France, Spain etc., that the Euro’s demands cannot be met: what is required is a radically changed European Union, even without a common currency, but with less bureaucracy, expense and overweening power.
Second is to decide how to dismantle the current structure, whilst minimising the potential for transitional currency arbitrage. This needs careful and closed-door planning. It could be assisted by the US, UK, Japan, IMF agreeing to supporting a plan of action and making it difficult for currency vultures to operate.
You could call the Greek bluff – leave if you want but you still owe us and you break the principle, now any one can in theory leave – at a major cost, but not impossible.
A more credible currency grouping might be Germany, Austria, Finland, Belgium and Luxembourg with real fiscal union?
Germany agreeing to leave of its own accord. This would remove the obvious major internal value disparity but would lead to a major initial drop in the value of the Euro if recent Swiss experience is an example, but destroy the European project and clobber its exports.
Whatever is decided, then those politicians who insist on its future should tell us why and debate and let the people decide who is right.
They will not, as they appear to value their personal positions more than those they were elected to serve.
We all await an answer, not just Greece and trust that Lewis Carroll was not prophetic in his tale of the Walrus and the Carpenter and the fate of the little oysters:
O Oysters,’ said the Carpenter,
You’ve had a pleasant run!
Shall we be trotting home again?’
But answer came there none,
And this was scarcely odd,
Because they’d eaten every one.