Tag Archives: Europe

Europe’s Elections and The Barbarians

Europe’s Elections

Dispatches From The Edge

Mar. 17, 2017

 

Going in to the recent elections in the Netherlands, the mainstream story seemed lifted from William Butler Yeats poem, The Second Coming: ”Things fall apart; the centre cannot hold—The best lack all conviction, while the worst are full of passionate intensity.” The Right was on the march, the Left at war with itself, the traditional parties adrift, and the barbarians were hammering at the gates of the European Union.

 

It’s a grand image, a sort of a politics as the “Game of Thrones,” but the reality is considerably more complex. There is, of course, some truth in the apocalyptic imagery: rightwing parties in the Netherlands, France, and Germany have grown. There are indeed some sharp divisions among left parties. And many Europeans are pretty unhappy with those that have inflicted them with austerity policies that have tanked living standards for all but a sliver of the elite.

 

But there are other narratives at work in Europe these days besides an HBO mega series about blood, war, and treachery.

 

The recent election in the Netherlands is a case in point. After holding a lead over all the other parties, Geert Wilders rightwing, racist Party for Freedom (PVV) faltered. In the end, his Islamophobes did not break the gates (but they did pick up five seats). Overall it was a victory for the center, but it was also a warning for those who advocate “staying the course” politics and, most pointedly the consequences of abandoning principles for power.

 

The Left Greens did quite well by taking on Wilders’ anti-Islam agenda and challenging Prime Minister Mark Rutte’s center-right Popular Party for Freedom and Democracy (VVD) on the economic front. In one national debate, Jesse Klaver, the Left Green’s dynamic leader, argued that janitors should be paid more and bankers less. The election, he said, is not about “Islam and Muslims,” but about “housing, income and health care.” The voters clearly bought it.

 

Rutte’s coalition partner, the left Labour Party, was crushed, losing 29 seats. For the past four years Labour has gone along with Rutte’s program of raising the retirement age and cutting back social spending, and voters punished them for shelving their progressive politics for a seat at the table.

 

The VVD also lost eight seats, which probably went to centrist parties like Democrats66, suggesting that Rutte’s “business as usual” is not what voters want either . VVD is still the number one party in the 150-seat parliament.

 

There were some lessons from the Dutch elections, though not the simplistic one that the “populist” barbarians lost to the “reasonable” center. What it mainly demonstrated is that voters are unhappy with the current situation, they are looking for answers, and parties on the left and center left should think carefully about joining governments that think it “reasonable” to impoverish their own people.

 

Next up in the election docket is France, where polls show Marine Le Pen’s neo-Nazi National Front leading the pack in a five-way race with traditional rightwing candidate Francois Fillon, centrist and former Socialist Party member Emmanuel Macron, Socialist Party candidate Benoit Hamon, and leftist Jean-Luc Melenchon. The first round, scheduled for April 23, will eliminate all but the two top vote getters. A final round will be held May 7.

 

With Melenchon and Hamon running at 11.5 percent and 13.5 percent respectively, thus splitting the left vote, the race appears to be between Fillon, Macron and Le Pen, with the latter polling slightly ahead of Macron and considerably better than Fillon.

 

If you are is attracted to the apocalypse analogy, France is probably your ticket.

 

Le Pen is running a campaign aimed against anyone who doesn’t look like Charlemagne or Joan of Arc, but her strong anti-EU positions play well with young people, in small towns, and among rural inhabitants. All three groups have been left behind by the EU’s globalism policies that have resulted in de-industrialization and growing economic inequality. Polls indicate she commands 39 percent of 18 to 24 year olds, compared with 21 percent for Macron and 21 percent for Fillon.

 

Fillon has been wounded by the revelation that he has been using public funds to pay family members some $850,000 for work they never did. But even before the scandal, his social conservatism played poorly to the young and workers are alienated by his economic strategy that harkens back to those of British Prime Minister Margret Thatcher, whom he greatly admires. His programs sound much like Donald Trump’s: cut jobless benefits and social services, lay off public workers, and give tax cuts to the wealthy.

 

Macron, an ex-Rothschild banker and former minister of economics under Hollande, is running neck and neck with Le Pen under the slogan “En Marche” (“On Our Way”), compelling critics on the left to ask “to what?” His platform is a mix of fiscal discipline and mild economic stimulation, and he is young, 39, telegenic, and a good speaker. But his policies are vague, and it is not clear there is a there, there.

 

Most polls indicate a Le Pen vs. Macron runoff, with Macon coming out on top, but that may be dangerous thinking. Macron’s support is soft. Only about 50 percent of those who say they intend to vote for him are “certain” of their vote. In comparison, 80 percent of Le Pen’s voters are “certain” they will vote for her.

 

There are, as well, some disturbing polling indications for the second round. According to the IFOP poll, some 38 percent of Fillon’s supporters say they will jump to Le Pen—two million voters—and 7 percent of Hamon voters and 11 percent of Melenchon backers would shift to Le Pen as well. What may be the most disturbing number, however, is that 45 percent of Melenchon voters say they will not vote if Macron is the candidate. Some 26 percent of Fillon’s voters and 21 percent of Hamon’s votes would similarly abstain.

 

Le Pen will need at least 15 million votes to win—the Front has never won more than six million nationally—but if turnout is low, Le Pen’s strongly motivated voters could put her into the Elysee Palace. In this way, France most resembles Britain prior to the Brixit vote.

 

If that comes to pass, Le Pen will push for a national referendum on the EU. There is no guarantee the French will vote to stay in the Union, and if they leave, that will be the huge trade organization’s death knell. The EU can get along without Britain, but it could not survive a Frexit.

 

Germany will hold national elections, Sept. 24, but the story there is very different than the one being played out in France. The government is currently a grand coalition between Chancellor Andrea Merkel’s conservative Christian Democratic Union (CDU), the Bavarian-based Christian Social Union (CSU), and the Social Democrats(SD). The alliance has been a disaster for the SD, which at one point saw its poll numbers slip below 20 percent.

 

But German politics has suddenly shifted. On Merkel’s left, the Social Democrats changed leaders and have broken with industrial policies that have driven down the wages of German workers in order to make the country an export juggernaut. On the Chancellor’s right, the racist, neo-Nazi Alternative for Germany (AfG) has drained CDU and CSU voters to support a ban on immigration and a withdrawal from the EU, although the Alternative is dropping in the polls.

 

The game changer has been the sudden popularity of former EU President, Martin Schultz, the new leader of the Social Democrats. The SD is now neck and neck with the CDU/CSU front, and some polls show Schultz actually defeating Merkel. In terms of personal popularity, Schultz is now running 16 points ahead of Merkel. While the Chancellor’s CDU/CSU alliance tops the polls at 34 percent, the Social Democrats are polling at 32 percent and climbing.

 

Schultz has made considerable headway critiquing declining living standards. Germany has large numbers of poorly paid workers, and almost 20 percent of workers age 25 to 34 are on insecure, short-term contracts. Unemployment benefits have also been cut back, even though Germany’s economy is the most robust in Europe and the country has a $310 billion surplus.

 

In any case, the days when Merkel could pull down 40 percent of the vote are gone. Even if her coalition comes in number one, it may not have enough seats to govern, even if its traditional allies, the Free Democrats, make it back into the Bundestag.

 

That creates the possibility of the first so-called “red-red-green” national government of the SD, the left Die Linke Party, and the Green Party. Die Linke and the Greens are both polling at around 8 percent. Such an alliance currently runs several major cities, including Berlin. It would not be an entirely comfortable united front: the SD and the Greens are pro-EU, while Die Linke is highly critical of the organization.

 

But there is a model out there that gives hope.

 

Portugal is currently run by a three-party center-left to left alliance. Those parties also disagree on things like the EU, the debt, and NATO membership, but for the time being they have decided that stimulating the economy and easing the burden of almost decade of austerity trumps the disagreements.

And then there are the Italians.

 

While Italy has not scheduled elections, the defeat of Democratic Party leader and then Prime Minister Matteo Renzi’s constitutional referendum almost guarantees a vote sometime in the next six months.

 

Italy has one of the more dysfunctional economies in the EU, with one of the Union’s highest debt ratios and several major banks in deep trouble. It is the EU’s third largest economy, but growth is anemic and unemployment stubbornly high, particularly among the young.

 

Renzi’s center-left Democratic Party (PD) still tops the polls, but only just, and it has fallen nearly 15 points in two years. Nipping at its heels is the somewhat bizarre Five Star Party run by comedian Beppe Grillo, whose politics are, well, odd. Five Star is strongly opposed to the EU, and allies itself with several rightwing parties in the European Parliament. It applauded the election of Donald Trump. On the other hand, it has a platform with many progressive planks, including economic stimulation, increased social services, a guaranteed income for poor Italians, and government transparency. It is also critical of NATO.

 

Five Star has recently taken a few poll hits, because the Party’s Mayor of Rome has done a poor job keeping the big, sprawling city running—in truth, the ancient Romans found it a daunting task—and is caught up in a financial scandal. Some Democratic Party leaders are also being investigated for corruption.

 

The only other major parties in the mix are former Prime Minister Silvio Burlusconi’s center-right Forza Italia, which is polling around 13 percent, and the racist., xenophobic Northern League at 11.5 percent. The latter, which is based the northern Po Valley, made a recent effort to broaden its base by taking its campaign to Naples in southern Italy. The result was a riot with protestors tossing rocks, bottles and Molotov cocktails at Northern League leader Matteo Salvini.

 

There are informal talks going on about uniting the parties. Burlusconi has worked with the Northern League in the past.

 

There are also a gaggle of smaller parties in the parliament, ranging from the Left Ecology/Greens to the Brothers of Italy, none registering over 5 percent. But since whoever comes out on top will need to form a coalition, even small parties will likely punch above their weight.

 

If Five Star does come in first and patches together a government, it will press for a referendum on the EU, and there is no guarantee that Italians—battered by the austerity policies of the big trade group—won’t decide to bail like the British did. An Italexit would probably be a fatal blow to the EU.

 

Predicting election outcomes are tricky these days, the Brexit and the election of Donald Trump being cases in point. The most volatile of upcoming ballots are in France and Italy. Germany’s will certainly be important, but, even if Merkel survives, the center-right will be much diminished and the left will be stronger. And that will have EU-wide implications.

 

The European left is divided, but not all divisions are unhealthy, and a robust debate is not a bad thing. None of the problems Europe faces are simple. Is the EU salvageable? What are the alternatives to austerity? How do you tackle growing inequality and the marginalization of whole sections of society? How do you avoid the debt trap facing many countries, blocked by the EU’s economic strictures from pursuing any strategy other than more austerity?

 

In a recent interview, Yanis Varoufakis, former Greek economic minister and one of the founders of the left organization DiEM25, proposed a “New Deal” for Europe, where in “All Europeans should enjoy in their home country the right to a job paying a living wage, decent housing, high-quality health care and education, and a clean environment.”

 

The “Deal” has five goals that Varoufakis argues can be accomplished under the EU’s current rules and without centering more power in Brussels at the expense of democracy and sovereignty. These would include:

  • “Large-scale” investment in green technology.
  • Guaranteed employment with a living wage
  • An EU-wide anti-poverty fund.
  • Universal basic income.
  • Anti-eviction protection.

 

None of those goals will be easy to achieve, but neither can Europe continue on its current path. The rightwing “populists” may lose an election, but they aren’t going away.

 

Almost 40 years ago, British Prime Minister Margaret Thatcher launched her neo-conservative assault on trade union rights, health care, education and social services with the slogan, “There is no other choice.” The world is still harvesting the bitter fruits of those years and the tides of hatred and anger they unleashed. It is what put Trump into the Oval Office and Le Pen within smelling distance of the French presidency.

 

But there is a choice, and it starts with the simple idea of the greatest good to the greatest number.

 

—30—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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A Dangerous Diplomatic Proposal

U.S. Diplomacy: A Dangerous Proposal

Dispatches From The Edge

Sept. 30, 2016

 

While the mainstream media focuses on losers and winners in the race between Hillary Clinton and Donald Trump, there is a largely unreported debate going on over the future course of U.S. diplomacy. Its outcome will have a profound effect on how Washington projects power—both diplomatic and military—in the coming decade.

 

The issues at stake are hardly abstract. The U.S. is currently engaged in active wars in Afghanistan, Iraq, and Syria, Yemen and Somalia. It has deployed troops on the Russian border, played push and shove with China in Asia, and greatly extended its military footprint on the African continent. It would not be an exaggeration to say—as former U.S. Secretary of Defense William Perry has recently done—that the world is a more dangerous place today than it was during darkest times of the Cold War.

 

Tracking the outlines of this argument is not easy, in part because the participants are not always forthcoming about what they are proposing, in part because the media oversimplifies the issues. In its broadest framework, it is “realists,” represented by former National Security Advisor Henry Kissinger, Harvard’s Steven Walt, and University of Chicago’s John Mearsheimer, versus “humanitarian interventionists” like current UN Ambassador Samantha Power. Given that Power is a key advisor to the Obama administration on foreign policy and is likely to play a similar role if Clinton is elected, her views carry weight.

 

In a recent essay in the New York Review of Books, Power asks, “How is a statesman to advance his nation’s interests?” She begins by hijacking the realist position that U.S. diplomacy must reflect “national interests,” arguing they are indistinguishable from “moral values”: what happens to people in other countries is in our “national security.”

 

Power—along with Clinton and former President Bill Clinton—has been a long-time advocate of “responsibility to protect,” or R2P, behind which the U.S. intervened in the Yugoslav civil war and overthrew the Muammar Gaddafi regime in Libya. Hillary Clinton has argued forcibly for applying R2P to Syria by setting up “no fly zones” to block Syrian and Russian planes from bombing insurgents and the civilians under their control.

 

But Power is proposing something different than humanitarian intervention. She is suggesting that the U.S. elevate R2P to the level of national security, which sounds uncomfortably like an argument for U.S. intervention in any place that doesn’t emulate the American system.

 

What is most telling about where all this leads is her choice of examples: Russia, China, and Venezuela, all currently in Washington’s crosshairs. Of these, she spends the most time on Moscow and the current crisis in Ukraine, where she accuses the Russians of weakening a “core independent norm” by supporting insurgents in Ukraine’s east, “lopping off part of a neighboring country” by seizing the Crimea, and suppressing the news of Russian intervention from its own people. Were the Russian media to report on the situation in Ukraine, she writes, “many Russians might well oppose” the conflict.

 

Power presents no evidence for this statement because none exists. Regardless of what one thinks of Moscow’s role in Ukraine, the vast majority of Russians are not only aware of it, but overwhelmingly support President Vladimir Putin on the issue. From the average Russian’s point of view, NATO has been steadily marching eastwards since the end of the Yugoslav war. It is Americans who are deployed in the Baltic and Poland, not Russians gathering on the borders of Canada and Mexico. Russians are a tad sensitive about their borders, given the tens of millions they lost in World War II, something that Power seems oblivious of.

 

What Power seems incapable of doing is seeing how countries like China and Russia view the U.S. That point of view is an essential skill in international diplomacy, because it is how one determines whether or not an opponent poses a serious threat to one’s national security.

 

Is Russia—as President Obama recently told the UN—really “attempting to recover lost glory through force,” or is Moscow reacting to what it perceives as a threat to its own national security? Russia did not intervene in Ukraine until the U.S. and its NATO allies supported the coup against the President Viktor Yanukovych government and ditched an agreement that had been hammered out among the European Union, Moscow, and the U.S. to peacefully resolve the crisis.

 

Power argues that there was no coup, but U.S. Assistant Secretary of State Victoria Nuland and the U.S. Ambassador to the Ukraine, Geoffrey Pyatt were caught on tape talking about how to “mid-wife” the takeover and choosing the person they wanted to put in place.

 

As for “lopping off” Crimea, Power had no problem with the U.S. and NATO “lopping off” Kosovo from Serbia in the Yugoslav War. In both cases local populations—in Crimea by 96 percent—supported the takeovers.

 

Understanding how other countries see the world does not mean one need agree with them, but there is nothing in Moscow’s actions that suggests it is trying to re-establish an “empire,” as Obama characterized its behavior in his recent speech to the UN. When Hillary Clinton compared Putin to Hitler, she equated Russia with Nazi Germany, which certainly posed an existential threat to our national security. But does anyone think that comparison is valid? In 1939, Germany was the most powerful country in Europe with a massive military. Russia has the 11th largest economy in the world, trailing even France, Germany, the United Kingdom, Italy and Brazil. Turkey has a larger army.

 

Power’s view of what is good for the Russian people is a case in point. While one can hardly admire the oligarchy that dominates Russia—and the last election would seem to indicate considerable voter apathy in the country’s urban centers—the “liberals” Power is so enamored with were the people who instituted that so-called economic “shock therapy” in the 1990s that impoverished tens of millions of people and brought about a calamitous drop in life expectancy. That track record is unlikely to get one elected. In any case, Americans are hardly in a position these days to lecture people about the role oligarchic wealth plays in manipulating elections.

 

The Chinese are intolerant of internal dissent, but the Washington’s argument with Beijing is over sea-lanes, not voter rolls.

 

China is acting the bully in the South China Sea, but it was President Bill Clinton who sparked the current tensions in the region when he deployed two aircraft carrier battle groups in the Taiwan Straits in 1995-96 during a tense standoff between Taipei and the mainland. China did not then—and does not now—have the capacity to invade Taiwan, so Beijing’s threats were not real. But the aircraft carriers were very real, and they humiliated—and scared—China in its home waters. It was that incident that directly led to China’s current accelerated military spending and its heavy-handed actions in the South China Sea.

 

Again, there is a long history here. Starting with the Opium Wars of 1839 and 1860, followed by the Sino-Japanese War of 1895 and Tokyo’s invasion of China in World War II, the Chinese have been invaded and humiliated time and again. Beijing’s view of the Obama administration’s “Asia pivot” is that it is aimed at surrounding China with U.S. allies.

 

While that might be an over simplification—the Pacific has long been America’s largest market— it is a perfectly rational conclusion to draw from the deployment of U.S. Marines to Australia, the positioning of nuclear-capable forces in Guam and Wake, the siting of anti-ballistic missile systems in South Korea and Japan, and the attempt to tighten military ties with India, Indonesia and Vietnam.

 

“If you are a strategic thinker in China, you don’t have to be a paranoid conspiracy theorist to think that the U.S. is trying to bandwagon Asia against China,” says Simon Tay, chair of the Singapore Institute of International Affairs.

 

As for Venezuela, the U.S. supported the 2002 coup against Hugo Chavez and has led a campaign of hostility against the government ever since. For all its problems, the Chavez government cut poverty rates from 70 percent of the population to 21 percent, and extreme poverty from 40 percent to 7.3 percent. Infant mortality fell from 25 per 1,000 to 13 per 1,000, the same as for Black Americans.

 

And the concern for the democratic rights of Venezuelans apparently doesn’t extend to the people of Honduras. When a military coup overthrew a progressive government in 2009, the U.S. pressed other Latin American countries to recognize the illegal government that took over in its wake. While opposition forces in Venezuela get tear-gassed and a handful jailed, in Honduras they are murdered by death squads.

 

Power’s view that the U.S. stands for virtue instead of simply pursuing its own interests is a uniquely American delusion. “This is an image that Americans have of themselves,” says Jeremy Shapiro, research director of the European Council on Foreign Relations, “but is not shared, even by their allies.”

 

The “division” between “realists” and R2P is an illusion. Both end up in the same place: confronting our supposed competitors and supporting our allies, regardless of how they treat their people. While she is quick to call the Russians in Syria “barbarous,” she is conspicuously silent on the U.S.’s support for Saudi Arabia’s air war in Yemen, which has targeted hospitals, markets and civilians.

 

The argument that another country’s internal politics is a national security issue for the U.S. elevates R2P to a new level, sets the bar for military intervention a good deal lower than it is today, and lays the groundwork for an interventionist foreign policy that will make the Obama administration look positively pacifist.

 

It is impossible to separate this debate from the current race for the White House. Clinton has been hawkish on most international issues, and she is not shy about military intervention.

 

She has also surrounded herself with some of the same people who designed the Iraq war, including founders of the Project for a New American Century. It is rumored that if she wins she will appoint former Defense Department official Michele Flournay Secretary of Defense. Flournay has called for bombing Assad’s forces in Syria.

 

On the other hand, Trump has been less than coherent. He has made some reasonable statements about cooperating with the Russians and some distinctly scary ones about China. He says he is opposed to military interventions, although he supported the war in Iraq (and now lies about it). He is alarmingly casual about the use of nuclear weapons.

 

In Foreign Affairs, Stephen Walt, a leading “realist,” says Trump’s willingness to consider breaking the nuclear taboo makes him someone who “has no business being commander in chief.” Other countries, writes Walt, “are already worried about American power and the ways it gets used. The last thing we need is an American equivalent of the impetuous and bombastic Kaiser Wilhelm II.”

 

The Kaiser was a major force behind World War I, a conflict that inflicted 38 million casualties.

 

Whoever wins in November will face a world in which Washington can’t call all the shots. As Middle East expert Patrick Cockburn points out, “The U.S. remains a superpower, but is no longer as powerful as it once was.” While it can overthrow regimes it doesn’t like, “It can’t replace what has been destroyed.”

 

Power’s framework for diplomacy is a formula for a never- ending cycle of war and instability.

 

—30—

Conn Hallinan can be read at dispatchesfromtheedgeblog.wordpress.com and middlemepireseries.wordpress.com

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Ukraine: To The Edge

Ukraine: To The Edge?

Foreign Policy In Focus

July 28, 2015

 

“If you want to talk about a nation that could pose an existential threat to the United States, I’d have to point to Russia. And if you look at their behavior, it’s nothing short of alarming.”

Gen. Joseph F. Dunford Jr. Chair U.S. Joint Chiefs of Staff

 

“This is not about Ukraine. Putin wants to restore Russia to its former position as a great power. There is a high probability that he will intervene in the Baltics to test NATO’s Article 5.”

Anders Fogh Rassmusen, former head of NATO

 

 

 

It is not just defense secretaries and generals employing language that conjure up the ghosts of the past. Presidential candidate Hillary Clinton used a “Munich” analogy in reference to Russian President Vladimir Putin, and a common New York Times description of Russia is “revanchist.” These two terms take the Ukraine crisis back to 1938, when fascist Germany menaced the world.

 

Yet comparing the civil war in the Ukraine to the Cold War—let alone Europe on the eve of World War II—has little basis in fact. Yes, Russia is certainly aiding insurgents in eastern Ukraine, but there is no evidence that Moscow is threatening the Baltics, or even the rest of Ukraine. Indeed, it is the West that has been steadily marching east over the past decade, recruiting one former Russian ally or republic after another into the North Atlantic Treaty Organization (NATO).

 

Nor did the Russians start this crisis.

 

It began when Ukrainian President Viktor Yanukovych turned down a debt deal from the European Union (EU) that would have required Kiev to institute draconian austerity measures, reduce its ties to Russia, and join NATO through the backdoor. In return, Ukraine would have received a very modest aid package.

 

Moscow, worried about the possibility of yet another NATO-allied country on its border, tendered a far more generous package. While the offer was as much real politic’ as altruism, it was a better deal. When Yanukovych took it, demonstrators occupied Kiev’s central square.

 

In an attempt to defuse the tense standoff between the government and demonstrators, France, Germany and Poland drew up a compromise that would have accelerated elections and established a national unity government. It was then that the demonstrations turned into an insurrection.

 

There is a dispute over what set off the bloodshed—demonstrators claim government snipers fired on them, but some independent investigations have implicated extremist neo-Nazis in initiating the violence. However, instead of supporting the agreement they had just negotiated, the EU recognized the government that took over when Yanukovych was forced to flee the country.

 

To the Russians this was a coup, and they are not alone in thinking so. George Friedman, head of the international security organization Stratfor, called it “the most blatant coup in history,” and it had western fingerprints all over it. U.S. Assistant Secretary of State Victoria Nuland and U.S. Ambassador Geoffrey Pyatt were recorded talking about how to “midwife” the overthrow of Yanukovych and who to put in his place.

 

Besides making Kiev a counterproposal on resolving its debt crisis, no one has implicated the Russians in any of the events that led up to the fall of Yanukovych. In short, Moscow has been largely reacting to events that it sees as deeply affecting its security, both military and economic.

 

Its annexation of Crimea—which had been part of Russia until 1954— followed a referendum in which 96 percent of the voters called for a union with Russia. In any case, Moscow was unlikely to hand over its strategic naval base at Sevastopol to a hostile government.

 

Somehow these events have morphed into Nazi armies poised on the Polish border in 1939, or Soviet armored divisions threatening to overrun Western Europe during the Cold War. Was it not for the fact that nuclear powers are involved these images would be almost silly. NATO spends 10 times what Moscow does on armaments, and there is not a military analyst on the planet who thinks Russia is a match for U.S. To compare Russia to the power of Nazi Germany or Soviet military forces is to stretch credibility beyond the breaking point.

 

So why are people talking about Article 5—the section of the NATO treaty that treats an attack on any member as an attack on all—and Munich?

 

The answer is complex because there are multiple actors with different scripts.

 

First, there are the neoconservatives from the Bush years that have not given up on the Project for a New American Century, the think tank that brought us the Afghan and Iraq wars, and the war on terror. It is no accident that Nuland is married to Robert Kagen, one of the Project’s founders and leading thinkers. The group also includes former Defense Department Undersecretary Paul Wolfowitz, Elliot Abrams, and former UN Ambassador John Bolton.

 

The neocons believe in aggressively projecting American military power and using regime change to get rid of leaders they don’t like. Disgraced by the Iraq debacle, they still have a presence in the State Department, and many are leading foreign policy advisors for Republican presidential candidates, including Rick Perry, Ted Cruz, and Jeb Bush. They are well placed and persistent, and if Bush is elected president there is talk that Nuland will become Secretary of State.

 

Then there are the generals, who have a number of irons in the fire.

 

There is a current in NATO’s leadership that would like to see the alliance become a worldwide military confederacy, although the Afghan disaster has dampened the enthusiasm of many. In fact, there is not even a great deal of support within NATO for enforcing Article 5, and virtually none for getting involved with sending arms to the Ukraine. Most NATO countries don’t even pony up the required level of military spending they are supposed to, leaving the U.S. to pick up 70 percent of the bills.

 

But there is nothing like conjuring up a scary Russian bear to loosen those purse strings. And indeed, a number of former scofflaws have upped their military spending since the Ukraine crisis broke.

 

The military and its associated industries—from electronics companies to huge defense firms—need enemies, preferably large ones, like Russia and China, where the weapons systems are big and the manpower requirements high.

 

Right now there appears to be a split among U.S. decision makers over whether Russia or China is our major competitor. For the neocons and most of the Republican candidates, the Kremlin is the clear and present danger. For the Obama administration and most Democrats—including Hillary Clinton—China is the competition, hence the so-called “Asia pivot” to beef up military forces in the Pacific and establish a ring of bases and allies to obstruct Beijing’s ability to expand.

 

One can make too much of this “division,” because most of these currents merge at some point. Thus the sanctions targeting Russia’s energy industry also squeeze China, which desperately needs oil and gas.

 

In response to sanctions, Russia is shifting its supplies and pipelines east. Russia and China have also begun establishing alternatives to western dominated financial institutions like the World Bank, the International Monetary Fund and the Asian Development Bank. Organizations like the BRICS countries—Brazil, Russia, India, China and South Africa—have established a development bank and currency reserves, and the new Chinese-initiated Asian Infrastructure Development Bank has already attracted not only Asian nations, but the leading European ones as well. The Shanghai Cooperation Organization now embraces over three billion people.

 

The U.S. has tried to derail a number of these initiatives.

 

The sanctions against Russia have made it difficult for Moscow to develop oil and gas in the arctic, and Washington pointedly told its allies that they should not join the China development bank. Both campaigns failed, particularly the latter. Only Japan and the Philippines heeded the American plea to boycott the bank. And Asia’s need for energy is overcoming many of the roadblocks created by the sanctions.

 

However, the campaign against Russia has damaged the Kremlin’s energy sales to Western Europe. The EU successfully blocked a Russian pipeline through Bulgaria, and the Americans have promised that its fracking industry will wean Europe off Russian energy. Fracking, however, is in trouble, because Saudi Arabia stepped up production and crashed oil prices worldwide. A number of U.S. fracking industries have gone belly up, and the industry is experiencing mass layoffs.

 

Stay tuned for EU-Russian energy developments.

 

Why are we in a dangerous standoff with a country that is not a serious threat to our European allies or ourselves, but does have the capacity to incinerate a sizable portion of the planet?

 

At least part of the problem is that U.S. foreign policy requires enemies so that it can deploy the one thing we know best how to do: blow things up. The fact that our wars over the past decade has led to one disaster after another is irrelevant, explained away by “inadequate” use of violence, lack of resolve or weak-kneed allies.

 

Americans are currently looking at a host of presidential candidates—excluding the quite sensible Bernie Sanders—who want to confront either Russia or China. Both are hideously dangerous policies and ones that are certainly not in the interests of the vast majority of Americans—let alone the rest of the planet.

 

It is really time to change things, and, no, the bear is not coming to get you.

 

—-30—-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Europe’s Debt: Lies and Myths

Europe’s Debt: Lies & Myths

Dispatches From The Edge

Feb. 23, 2015

 

“Debt, n. An ingenious substitute for the chain and whip of the slave driver”

Ambrose Bierce

Journalist & writer

 

“The history of an oppressed people is hidden in the lies and agreed myth of its conquerers”

 

Meridel Le Suer

Author & activist

 

 

Myths are dangerous precisely because they rely more on cultural memory and prejudice than facts, and behind the current crisis between Greece and the European Union (EU) lays a fable that bears little relationship to why Athens and a number of other countries in the 28-member organization find themselves in deep distress.

 

The tale is a variation of Aesop’s allegory of the industrious ant and the lazy, fun-loving grasshopper, with the “northern countries”—Germany, the Netherlands, Britain, Finland—playing the role of the ant, and Greece, Spain, Portugal, and Ireland the part of the grasshopper.

 

The ants are sober and virtuous—lead by the frugal Swanban house frau, German Chancellor Angela Merkel—the grasshoppers are spendthrift, corrupt lay-abouts who have spent themselves into trouble and now must pay the piper.

 

The problem is that this myth bears almost no relationship to the actual roots of the crisis or what the solutions might be. And it perpetuates a fable that the debt is the fault of individual countries rather than a serious crisis at the very heart of the EU.

 

First, a little myth busting.

 

The European debt crisis goes back to the end of the roaring ‘90s when the banks were flush with money and looking for ways to raise their bottom lines. One major strategy was to pour money into real estate, which had the effect of creating bubbles, particularly in Spain and Ireland. In the latter, from 1999 to 2007, bank loans for Irish real estate jumped 1,730 percent, from 5 million Euros to 96.2 million Euros, or more than half the GDP of the Republic. Housing prices increased 500 percent. “It was not the public sector but the private sector that went haywire in Ireland,” concludes Financial Times analyst Martin Wolf.

 

Spain, which had a budget surplus and a low debt ratio, went through much the same process, and saw an identical jump in housing prices: 500 percent.

 

In both countries there was corruption, but it wasn’t the penny ante variety of tax evasion or profit skimming. Politicians—eager for a piece of the action and generous “donations”—waved zoning rules, environmental regulations, and cut sweetheart tax deals. Hundreds of thousands of housing projects went up, many of them never to be occupied.

 

Then the American banking crisis hit in 2008, and the bottom fell out. Suddenly, the ants were in trouble. But not really, because the ants have a trick: they gamble and the grasshoppers pay.

 

The “trick,” as Joseph Stiglitz, Nobel Laureate in economics, points out, is that Europe (and the U.S.) have moved those debts “from the private sector to the public sector—a well-established pattern over the past half-century.”

 

Fintan O’Toole, author of “Ship of Fools: How Stupidity and Corruption sank the Celtic Tiger,” estimates that to save the Irish-Anglo Bank Irish taxpayers shelled out $30 billion Euros, a sum that was the equivalent of the Island’s entire tax revenues for 2009. The European Central Bank—which, along with the International Monetary Fund (IMF) and the European Commission, make up the “Troika”—strong-armed Ireland into adopting austerity measures that tanked the country’s economy, doubled the unemployment rate, increased consumer taxes, and forced many of the country’s young people to emigrate. Almost half of Ireland’s income tax now goes just to service the interest on its debts.

 

Poor Portugal. It had a solid economy and a low debt ratio, but currency speculators drove up interest rates on borrowing beyond what the government could afford, and the European Central Bank refused to intervene. The result was that Lisbon was forced to swallow a “bailout” that was laden with austerity measures that, in turn, torpedoed its economy.

 

In Greece’s case corruption was at the heart of the crisis, but not the popular version about armies of public workers and tax dodging oligarchs. There are rich tax dodgers aplenty in Greece, but Germany, Sweden, and many other European countries spend more of their GDP on services than does Athens. Greece spends 44.6 percent of its GDP on its citizens, less than the EU average and below Germany’s 46 percent and Sweden’s 55 percent.

 

And as for lazy: Greeks work 600 hours more a year than Germans.

 

According to economist Mark Blyth, author of “Austerity: The History of a Dangerous Idea,” Greek public spending through the 2000s is “really on track and quite average in comparison to everyone else’s,” and the so-called flood of “public sector jobs” consisted of “ 14,000 over two years.” All the talk of the profligate Greek government is “a lot of nonsense” and just “political cover for the fact that what we’ve done is bail out some of the richest people in European society and put the cost on some of the poorest.”

 

There was a “score” in Greece. However, it had nothing to do with free spending, but was a scheme dreamed up by Greek politicians, bankers, and the American finance corporation, Goldman Sachs.

 

Greece’s application for EU membership in 1999 was rejected because its budget deficit in relation to its GDP was over 3 percent, the cutoff line for joining. That’s where Goldman Sachs came in. For a fee rumored to be $200 million (some say three times that), the multinational giant essentially cooked the books to make Greece look like it cleared the bar. Then Greece’s political and economic establishment hid the scheme until the 2008 crash shattered the illusion.

 

It was the busy little ants, not the fiddling grasshoppers that brought on the European debt crisis.

American, German, French, and Dutch banks had to know that they were creating an unstable real estate bubble—a 500 percent jump in housing prices is the very definition of the beast—but kept right on lending because they were making out like bandits.

 

When the bubble popped and Europe went into recession, Greece was forced to apply for a “bailout” from the Troika. In exchange for 172 billon Euros, the Greek government instituted an austerity program that saw economic activity decline 25 percent, unemployment rise to 27 Percent (and over 50 percent for young Greeks). The cutbacks slashed pensions, wages, and social services, and drove 44 percent of the population into poverty.

 

Virtually all of the “bailout”—89 percent—went to the banks that gambled in the 1999 to 2007 real estate casino. What the Greek—as well as Spaniards, Portuguese, and Irish—got was misery.

 

There are other EU countries, including Italy and France that, while not in quite the same boat as the “distressed four,” are under pressure to bring down their debt ratios.

 

But what are those debts?

 

This past summer, the Committee for a Citizen’s Audit on the Public Debt issued a report on France, a country that is currently instituting austerity measures to bring its debt in line with the magic “3 percent” ratio. What the Committee concluded was that 60 percent of the French public debt was “illegitimate.”

 

More than 18 other countries, including Brazil, Portugal, Ecuador, Greece and Spain, have done the same “audit,”, and, in each case, found that increased public spending was not the cause of deficits. From 1978 to 2012, French public spending actually declined by two GDP points.

 

The main culprit in the debt crisis was a fall in tax revenues resulting from massive tax cuts for corporations and the wealthy. According to Razmig Keucheyan, sociologist and author of “The Left Hemisphere,” this “neoliberal mantra” that was supposed to increase investment and employment did the opposite.

 

According to the study, the second major reason was the increase in interest rates that benefits creditors and speculators. Had interests rates remained stable during the 1990s, debt would be significantly lower.

 

Keucheyan argues that tax reductions and interest rates are “political decisions” and that “public deficits do not grow naturally out of the normal course of social life. They are deliberately inflicted on society by the dominant classes to legitimize austerity policies that will allow the transfer of value from the working classes to the wealthy ones.”

 

The International Labor Organization recently found that wages have, indeed, stalled or declined throughout the EU over the past decade.

 

The audit movement calls for repudiating debt that results from “the service of private interests” as opposed to the “wellbeing of the people.” In 2008, Ecuador canceled 70 percent of its debt as “illegitimate.”

 

How this plays out in the current Greek-EU crisis is not clear. The Syriza government is not asking to cancel the debt—though it would certainly like a write down—but only that it be given time to let the economy grow. The recent four-month deal may give Athens some breathing room, but the ants are still demanding austerity and tensions are high.

 

What seems clear is that Germany and its allies are trying to force Syriza into accepting conditions that will undermine its support in Greece and demoralize anti-austerity movements in other countries.

 

The U.S. can play a role in this—President Obama has already called for easing the austerity policies—through its domination of the IMF. By itself Washington can outvote Germany, the Netherlands, and Finland, and could exert pressure on the two other Troika members to compromise. Will it? Hard to say, but the Americans are certainly a lot more nervous about Greece exiting the Eurozone than Germany.

 

But the key to a solution is exploding the myth.

 

That has already begun. Over the past few weeks, demonstrators in Greece, Spain, Italy, Germany, Portugal, Great Britain, Belgium and Austria have poured into the streets to support Syriza’s stand against the Troika. “The Left has to work together having as its common goal the elimination of predatory capitalism” says Maite Mola, vice-president of the European Left organization and member of the Portuguese parliament. “And the solution should be European.”

 

In the end, the grasshoppers might just turn Aesop’s fable upside down.

 

—30—

 

 

 

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