EU - what's next?

Zuper wrote:Mozda sutra bude bolje, ali nije sigurno.
Dobar si ti trol, lepo treniran.
Ali razmisli da u ozujku odradis trening protiv rusofobije.

Na samitu EU BEZ DOGOVORA o budžetu

Brexit’s Stealthy Rationality

Feb 21, 2020 YANIS VAROUFAKIS

The motives and thinking behind Brexit were even less worthy than those behind US President Richard Nixon’s move in 1971 to ditch the Bretton Woods system. But, as with the "Nixon shock," there is a singular underlying historical factor that explains Brexit.

ATHENS – At pivotal historical moments, rational political ruptures often are brought about for all the wrong reasons. UK Prime Minister Boris Johnson’s Brexit may prove to be a case in point.

When US President Richard Nixon ditched the Bretton Woods system in August 1971, his reasons were shortsighted. Overwhelmed by domestic pressures to impose ineffective price controls and placate his blue-collar supporters, Nixon took his eye off the larger picture. Still, he was following a sound instinct: historical forces had ruled against the sustainability of that remarkable post-war global monetary system. Once America went from being a net global creditor to being a debtor economy in sustained deficit to the rest of the capitalist world, Bretton Woods was condemned to extinction, because the Federal Reserve could no longer guarantee a fixed exchange rate with the Deutsche Mark, yen, franc, and so on.

To be sure, the median American worker’s income and living standards have never recovered from the so-called Nixon shock, and the resulting financialization of capitalism has been detrimental to humanity. But that does not take anything away from the deeper rationality of Nixon’s decision.

The motives and thinking behind Brexit were even less worthy than those behind Nixon’s move. Nurtured by austerity-fueled discontent, trading on xenophobia, and riding on the coattails of false promises, Brexit and its backers won the day for many bad reasons. And, like the Nixon shock, most of those who voted for the man who implemented Brexit will, most likely, lose out, while many others will profit handsomely. The working-class neo-Tories who enabled this historical rupture will suffer in quiet desperation the consequences of their choice.

But is there, as with the Nixon shock, a singular underlying historical factor that explains Brexit? There is: the creation of the euro.

Portraying necessity as a virtue, euro-loyalist politicians, opinion makers, and bureaucrats extol the European Union’s flexibility by describing the eurozone as a union within a union, or a club within a club. While this description is formally correct, it fails to capture the centrifugal forces that the euro unleashed. Once the single currency was created, in the designed absence of common debt instruments and a common deposit insurance facility, the EU train was put on a track leading inexorably to a junction. There, it could turn sharply toward federation or continue on the same route until, running out of track, it disintegrated.

The euro’s fathers, German Chancellor Helmut Kohl and French President François Mitterrand, knew this. They were convinced that once the fork was reached, their successors would bow to the inevitable and steer, however reluctantly, toward federation. That was also the view of UK Prime Minister Margaret Thatcher, who, observing the construction of a European central bank, began to ring the alarm bells that summoned a renewed Euroskepticism and, ultimately, Brexit.

Ironically, Kohl, Mitterrand, and Thatcher made the same mistake. All three leaders assumed that the euro was, as Thatcher put it, an effort to build “a federal Europe by the back door.” It wasn’t. As we now know, when the euro came close to imploding in 2011, the EU’s decision-makers did the opposite of what Kohl, Mitterrand, and Thatcher had anticipated. With the critical junction approaching and confronting them with the federate-or-disintegrate dilemma, the locomotive’s drivers demonstrated that they preferred derailment. That was the moment when Brexit acquired a stealthy rationality.

Every historical force needs a multitude of agents to give it purchase. Brexit’s greatest agents were, ironically, two people who opposed it: Gordon Brown and Angela Merkel.

As UK Prime Minister Tony Blair’s Chancellor of the Exchequer, Brown became an enabler of Brexit by keeping, for a variety of excellent reasons, the United Kingdom out of the eurozone. Had he acceded to Blair’s preference to adopt the euro, events would have unfolded very differently. Given the size of the City of London, no EU bailout could have re-floated Britain’s banks after the 2008 financial crisis without ditching the euro’s rulebook and without forcing an immediate, clean decision: federate or return to national currencies.

Brown thus became the unwitting enabler of Merkel’s penchant for kicking the can down the road. By keeping the UK out of the euro, Brown enabled Germany to continue resisting federation while ensuring that Brexit remained a relatively low-cost option for the British.

Unburdened by the mammoth task of bailing out the City, Merkel concentrated on suspending democracy in deficit member states such as Ireland, Greece, and Italy, in order to impose, with the help of the European Central Bank, years of austerity that ended up miring the entire eurozone in permanent stagnation. Without that ugly suppression of democracy, and the millions of continental Europeans fleeing to a UK economy that had been re-floated by the Bank of England, the Brexit referendum would have gone the other way.

Nixon and Johnson’s ruptures confirm that whatever is unsustainable eventually finds the political agents of its collapse. Such ruptures can be simultaneously detrimental to most people’s interests and intrinsically rational and self-perpetuating.

In the United States, the long-term diminution of blue-collar workers’ prospects was counter-balanced by the stupendous gains of the top 10% and the expansion of America’s global hegemony. In this sense, the Nixon shock passed the test of history, even if it diminished most Americans’ life prospects.

Brexit may well be similarly vindicated. If Johnson ends austerity and succeeds in attracting investment in artificial intelligence and green energy (which the EU is failing seriously to fund), Brexit may come to be viewed the same way as Brown’s decision to keep the UK out of the eurozone is today: a smart move.

Taking a broader view, there are international systems that have the potential to deliver massive benefits for majorities in every participating country. Bretton Woods and the EU are prime examples. But when political leaders fail to consolidate such systems, their tragic (in the Ancient Greek sense) disintegration eventually takes on a rationality of its own, thus coming to seem inevitable and, equally important, irreversible.

Belgian parade featuring big-nosed Jews set to include even more antisemitic effigieshttps://t.co/89180COfbR pic.twitter.com/pxAs2MJzId

— The Jewish Chronicle (@JewishChron) February 21, 2020

Les Juifs sont de la vermine (de la vermine pleine de fric qui contrôle le monde quand même) et les nazis sont des gars sympas que les enfants applaudissent et avec qui on a bien envie de boire une bière. Bienvenue au carnaval d’Alost en 2020, en Belgique, cœur de l’UE. Dégénérés pic.twitter.com/svFR1MxxZf

— Raphael Glucksmann (@rglucks1) February 23, 2020

Polish state TV reports: "A strong Poland irritates the Germans". pic.twitter.com/XHuSoItveK

— Adam Traczyk (@A_Traczyk) May 17, 2020

European Defense and ‘Strategic Autonomy’ Are Also Coronavirus Victims

With governments under intense spending pressure to cope with the coronavirus, European ambitions for a more independent defense are facing the chop.

By Steven Erlanger
May 23, 2020, 3:50 a.m. ET

BRUSSELS — The coronavirus has upended the best-laid plans and priorities of many, including the European Union. But one of the biggest casualties may be European efforts to build a more credible and independent European military.

For several years, especially since President Trump came to office with his skepticism about NATO, European alliances and multilateral obligations, leaders like French President Emmanuel Macron have been pushing for what he has called European “strategic autonomy,” the ability to defend Europe and act militarily in its neighborhood without so much reliance on the United States.

But even before the virus hit so hard, and despite loud calls that the bloc was in greater peril from new technologies and a more aggressive Russia and China, the European Commission was already sharply slashing projected European military spending in the next seven-year budget.

Now, with the pandemic having cratered the economy, there will be an even fiercer battle of the budget. Recovery and jobs will have to be the priority, and Brussels continues to emphasize investment in a European “Green Deal” to manage the climate crisis. Military spending is highly likely to lose out, making cries for European boldness and self-reliance ring increasingly hollow.

“We Europeans truly need to take our fate in our own hands,” said Chancellor Angela Merkel of Germany after Mr. Trump’s election. In February, Mr. Macron called again for “a much stronger Europe in defense.”

And only last week, Josep Borrell Fontelles, the bloc’s foreign policy chief, said that the virus “will only increase the need for a stronger E.U. security and defense and for a stronger Europe in the world.” He pleaded for more funds, saying that “the pandemic is a new threat and will deteriorate our security environment.”

But despite such calls, a modest trend toward more European military spending is likely to be reversed. European governments were struggling bitterly over the size of the bloc budget, especially after the hole left by Brexit, even before the virus added new elements of uncertainty and massive fiscal deficits.

Washington’s chaotic and self-centered response to the virus has made Europeans feel even more vulnerable.

“This pandemic has been another nail in the coffin of European trust in U.S. leadership,” said Radoslaw Sikorski, a European legislator and former Polish defense minister. “But if the idea of European autonomy has been strengthened by this crisis, the ability to finance it has been put on ice.”

Ben Hodges, former commander of U.S. Army Europe, was blunt.

“If there’s no money for it, then you’re not serious about it,” he said.

Two years ago, the Europeans created, with much fanfare, two important programs — one for collective military procurement and investment on projects, known as Pesco and funded by participating nations; and another, the European Defense Fund, to promote military research and development, funded from the bloc’s new seven-year budget and projected at 13 billion euros, or €1.86 billion a year.

Pesco was a modest beginning, but the fund was a breakthrough, because it came from the collective budget. Another key proposal, in agreement with NATO, was a mobility initiative of €6.5 billion, to facilitate moving heavy arms like artillery and tanks through Europe if a crisis broke out with Russia. Those capabilities, including reinforced bridges, railway carriages and bureaucratic permissions, had been largely abandoned with the Soviet collapse.

But now, after Russian wars against Georgia and Ukraine, the annexation of Crimea and increased Russian military pressure on Baltic nations, the idea of armed conflict with Moscow or its proxies no longer seems absurd. NATO enhanced deterrence by stationing troops along Russia’s borders — but NATO needed credible means to reinforce them.

But even in the European Union’s pre-virus negotiations over the next seven-year budget, more contentious than usual because of the gap created by Brexit, military spending was gutted. The European Commission cut the defense fund by more than half, to €6 billion. Proposed funding for military mobility dropped from €6.5 billion to €2.5 billion, then €1.5 billion and now, in the latest proposal, to zero.



Now the Europeans are wrangling over how to include a massive virus recovery fund. Defense is barely discussed.

Some analysts, like Claudia Major of the German Institute for International and Security Affairs, caution that the budget negotiations are not finished. Given the pandemic, Brussels may decide to have only a one- or two-year budget, postponing harder choices.

But the crises of six months ago have not gone away, cautioned Jens Stoltenberg, the secretary general of NATO.

“If anything,” he said in an interview, “the virus amplifies the problems,” which range from Russia and China to cybersecurity, terrorism and civil wars in Libya and Syria.

In the last two years alone, he said, China has built 80 new ships and submarines, while both Russia and China are investing in new missiles, nuclear capability, drones, unmanned weapons and artificial intelligence.

He conceded that there is a struggle for investment now, but insisted that NATO militaries had shown their usefulness during the pandemic and that “investing in defense can be a powerful engine for economic recovery.”

But it was obvious, Mr. Stoltenberg said, that “the European Union cannot defend Europe” without the United States. He hoped Europe would do more on defense, “but it cannot replace NATO,” he said.

If Mr. Stoltenberg is reluctant to criticize the Europeans, Mr. Hodges is less shy.



“Any European leader who talks of strategic autonomy and a European army and can’t come up with a single euro for mobility — well, no one will take that seriously, either in the United States or among adversaries,” said Mr. Hodges, who works with the Center for European Policy Analysis.

Anna Wieslander, a Swedish defense expert with the Atlantic Council, said that the funding debacle dashes dreams of European autonomy. “The way the E.U. budget on defense went even before the corona crisis, even on the most important project of military mobility — let’s leave this bit of naïve dreaming behind,” she said.

Europe’s dangers have only increased with poor American leadership and “new strains between the U.S. and China over the virus,” she said. “The signal to Europeans is that we need to act, and maybe even quicker. So we need to make the European pillar in NATO stronger and more explicit.”

Jim Townsend, a former U.S. deputy assistant secretary of defense, saw more squabbles inside NATO. “It will be harder for European governments, like Italy, to say that we need to spend more on defense to reach 2 percent” of GDP, the NATO guideline that obsesses Mr. Trump, he said.

Europe’s retreat on military spending will complicate relations with Washington, with its own huge budget pressures, no matter who wins the presidency. “With fewer resources to invest in key capabilities, Europe’s reliance on the U.S. as the main provider of common security will continue,” said Derek Chollet, a former U.S. assistant secretary of defense.

But that dependency, resented in Washington by both political parties, may be unreliable. Washington will concentrate its firepower on China no matter who is president, Ms. Wieslander said.

The United States “has to focus on Asia but will have strained resources itself,” she said, and is incapable of fighting two regional wars at once. “It’s not that the Americans won’t want to come to Europe’s defense,” she said, “but will they be able to?”

In Britain, still a key to European and NATO defense, the virus has postponed a review of foreign and defense policy, meant to run in parallel with a spending review, said Malcolm Chalmers, deputy director of RUSI, a defense think tank. “Big choices have been put on hold,” he said. “Now the reviews will be dominated by the pandemic, and what defense has done and can do to tackle this central threat.”

Mr. Chollet sees a similar quandary in America.

“There will be a new debate about what security is, since this virus has done more damage and killed more people than any conventional power could have done in such a short period of time,” he said.

“The security of the Baltics can seem a little theoretical these days,” he said, “when nothing about this crisis feels theoretical.”

https://www.nytimes.com/2020/05/23/world/europe/defense-autonomy-europe-coronavirus.html?smid=tw-share

solidarity...

meet frugality. pic.twitter.com/PkRwQG1tsV

— Rem Korteweg (@remkorteweg) May 23, 2020

Nope. That's what it says.

— Rem Korteweg (@remkorteweg) May 23, 2020