Archive for the ‘Europe’ Category

Helmut Schmidt R.I.P.


[update below] [2nd update below]

Helmut Schmidt is not someone whose death I would normally have a post on, as I didn’t think about him too much over the decades, but as I am presently teaching two courses on the European Union—one to American undergrads (in French), the other to French graduate students (in English)—I have had occasion to mention him more than twice over the past month, for the role he played in the construction of Europe during his years as chancellor and in solidifying the Franco-German partnership. I told my students—almost none of whom recognized him from a photo or knew a thing about him—that he was up there with Germany’s other outsized postwar chancellors (which happens to be most of them: Konrad Adenauer, Willy Brandt, Helmut Kohl, and Angela Merkel). And his center-left politics were about where mine are today (though not during his time in office, when I was rather more gauchiste).

To commemorate his death, Foreign Affairs has posted on its website an essay Schmidt wrote for the journal’s May-June 1997 issue, “Miles to Go: From American Plan to European Union,” in which he discusses the three speeches that had “a decisive impact on the economic and political rehabilitation of Europe after World War II”: Winston Churchill’s in 1946, on his vision of a United States of Europe; George C. Marshall’s in 1947, laying out what would become the Marshall Plan the following year; and Robert Schuman’s famous one of May 9th 1950, which led to the Treaty of Paris and creation of the ECSC, which in turn led to the Treaty of Rome and then today’s EU. Toward the end of the essay, Schmidt offers this

As this new world emerges [one with three superpowers: the United States, Russia, and China, plus Japan], what will be Europe’s role and weight in international affairs? Neither Britain nor France is a world power any longer, even if they find this difficult to admit to themselves. Italy ceased to be a world power when the Germanic barbarians destroyed the Roman Empire. And, after losing two world wars and constraining itself within a web of European institutions, Germany will never again become a world power. None of the European nation-states will be sufficiently influential to pursue its national interests alone as the world comes to terms with the oncoming global paradigm shift and attempts to address the host of issues that will arise over the control of financial markets, over exchange rates and freedom of trade, arms control, limits on population growth, and the deterioration of the atmosphere and the oceans. Only a vital European Union will have the political, economic, and financial weight to exert an influence on global affairs equal to that of the three superpowers.

It’s a great piece. Absolutely worth reading in full.

Another great essay by Schmidt that’s been posted on more than one website since yesterday is the transcript of the speech he gave on December 4th 2011 at the SPD party congress in Berlin, “Germany in, with and for Europe,” which was widely remarked on at the time in Germany. Money quotes

In 2050, each of the European nations will constitute just a fraction of one per cent of the world’s population. In other words, if we cherish the notion that we Europeans are important for the world, we have to act in unison. As individual states – France, Italy, Germany, Poland, Holland, Denmark or Greece – we will ultimately be measured not in percentages, but in parts per thousand.

That is why the European nation states have a long-term strategic interest in their mutual integration. This strategic interest in European integration will become increasingly significant.

Further down

The Federal Republic of Germany is a very large country with a very competitive economy that needs to be integrated into Europe – to protect it from itself, amongst other things. Ever since 1992 therefore – since the times of Helmut Kohl – Article 23 of the Basic Law has obliged us to cooperate »… in the development of the European Union«. Article 23 also obliges us, as an element of this cooperation, to heed »the principle of subsidiarity«. The present crisis affecting the ability of the EU institutions to take action does not change these principles in any way.

In view of our central geopolitical location, the unfortunate role we played in European history up to the middle of the twentieth century and the strong economy we have today, every German government is called upon to show the utmost sensitivity towards the interests of our partners in the European Union. And our willingness to help is indispensable.

And in conclusion

my friends, let me say that there is really no need to preach international solidarity to Social Democrats. For a century and a half, German Social Democrats have been internationalists to a far greater extent than generations of Liberals, Conservatives or German Nationalists. We Social Democrats have upheld the cause of freedom and human dignity. We have held fast to representative parliamentary democracy. These fundamental values make it our duty to exercise European solidarity today.

In the 21st century, Europe will undoubtedly continue to consist of nation states, each with its own language and history. For that reason Europe will definitely not become a federal state. However, the European Union cannot afford to degenerate into a mere confederation. The European Union must remain a dynamically developing alliance, for which there is no parallel in the whole of human history. We Social Democrats must contribute to the gradual evolution of this alliance.

Also making the rounds since yesterday is Schmidt’s famous line from 1972, when he was finance minister: “I’d rather have five percent inflation than five percent unemployment.” Too bad the spirit of this wasn’t inscribed in the Treaty on European Union and the architecture of the single currency.

Here’s a quote from World Jewish Congress President Ronald Lauder

Helmut Schmidt was undoubtedly one of the great Germans of the 20th century…When terrorists struck during the 1970s, he refused to be blackmailed and stood his ground. He stood with America when it came to defending the West against Soviet expansionism.

Not a single obituary has neglected to mention that Schmidt was a heavy smoker for almost his entire life, consuming two to three packs of cigarettes a day (menthol, no doubt with high tar content)—along with snuff—from his early teens until a few months ago, after his 96th birthday. According to my calculation, he must have smoked over a million cigarettes in his life. And yet he stayed active—intellectually and otherwise—almost to the very end. Talk about beating the odds.

UPDATE: Die Zeit editor Josef Joffe has a good remembrance in the WSJ of “The man who saved Germany’s new democracy: Helmut Schmidt saw his country through terrorism and Soviet intimidation with its liberty intact.”

And see Le Monde’s very good editorial, “Helmut Schmidt, un visionnaire dans le réel.”

2nd UPDATE: Die Zeit political editor Jochen Bittner has an op-ed in the NYT explaining “Why Germans loved Helmut Schmidt.”

Süddeutsche Zeitung

Süddeutsche Zeitung

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In Las Vegas, October 13th (photo: Matt Baron/Rex Shutterstock)

In Las Vegas, October 13th (photo: Matt Baron/Rex Shutterstock)

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This is not a post on last Tuesday’s Democratic presidential debate, which is old news by now. I’ve tweeted numerous analyses/commentaries of it over the past five days that I thought were on target and/or interesting, so one knows—if one read them, of course—that I agree with the MSM pundits that Hillary Clinton was very good and Bernie Sanders too. It was a fine debate. I’ve been nervous about Hillary—in view of her high negatives in the polls and the visceral dislike of her by many Democratic voters (and notably on the left; I see gauchiste Hillary hate every day on social media)—but am now less so. I’m confident she’ll be a good candidate in the general election—and barring stunning new scandal or major, game-changing revelation in the email business, she will be the Dems’ nominee—and if voters turn out on Nov. 8th ’16 in the same proportions as they did in ’12 and ’08, she will most certainly win (yep, I just said it). As for Bernie, I like him and am glad he’s running—to pull the debate to the left and energize young people—but he ain’t gonna be the Dem nominee. Not a chance. O’Malley and Webb: I hope they raise their profiles and do respectably in the early primaries and caucuses, so as to position themselves as plausible running mates for Hillary (and particularly O’Malley; I can’t see a Hillary-Bernie ticket and for a variety of reasons). Before the debate I was hoping that Biden would enter the race—mainly out of Hillary nervousness—but now think it would probably be better if he didn’t.

One moment in the debate that attracted attention was Bernie saying that America “should look to countries like Denmark, like Sweden and Norway, and learn from what they have accomplished for their working people.” Of course. America should naturally look to the experiences of the Scandinavian countries—and to France, Germany, and other advanced democracies—to see what can be learned from them (and what should not be learned). And vice-versa. Politicians and policy-makers should always study other countries.

Bernie’s Denmark comment provoked the inevitable snarky reactions on the right, e.g. this one by the National Review’s Kevin Williamson, which misses Bernie’s point; it is, as we say here, à côté de la plaque. There has, however, been one reaction from that side of the spectrum—and which inspired this post—that I find most interesting, “Double-edged Denmark,” by Will Wilkinson, who is vice-president for policy at the Niskanen Center, a  libertarian think tank in Washington founded last year. Wilkinson seconds the observation by Williamson and other rightists that Denmark, despite its robust welfare state, has embarked on major free market reforms to the point where it is now more “capitalistic” than the US (a development Williamson suggests that Bernie ignores, which is nonsense). This is well-understood by anyone with a cursory knowledge of that country’s politics, including in France, where the Danish “flexicurity” model has been studied by policy intellectuals and politicians, with its applicability to the French context provoking debate, notably on the left (e.g. in the pages of Le Monde, Alternatives Économiques, and other such publications). But Wilkinson sees a symbiotic relationship between Denmark’s free market reforms and its strong social safety net that other conservatives miss. Money quotes

Right-leaning arguments about the free-market marvel that is Denmark cut both ways. Denmark shows us that a much larger public sector and a much more robust social-insurance system need not come at the expense of a dynamic market economy. In other words, Denmark shows us that capitalism and a large welfare state are perfectly compatible and possibly complementary. (…)

The lesson free-marketeers need to learn is that Denmark may be beating the U.S. in terms of economic freedom because it’s easier to get people to buy in to capitalism when they’re well-insured against its downside risks. That’s the flipside irony of free-market “socialism.” (…)

The possibility that generous social insurance can bolster support for capitalism is worth taking seriously, not only because the truth (whatever it is) is important in its own right, but because the truth of the matter could have profound implications for other libertarian policy priorities. (…)

So if one wants a bona fide neoliberal free market economy, Wilkinson suggests, the trade-off—in an advanced democracy at least—is a strong social safety net. It’s not every day one gets such insights from a libertarian—though Friedrich Hayek, who did not object to state-organized social insurance schemes, would possibly say much the same thing if he were around today.

Vox’s Matthew Yglesias—who is no libertarian—has also weighed in on the Danish model (October 16th), in answering “9 questions about Denmark, Bernie Sanders’s favorite socialist utopia.”

UPDATE: Paul Krugman’s NYT column today (October 19th) is on Denmark.


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Syria’s lost generation

Syrian refugee collecting leftover food, Istanbul (photo credit: AFP)

Syrian refugee collecting leftover food, Istanbul (photo credit: AFP)

Istanbul-based journalist Sebnem Arsu has a feature article in Politico.eu on the dire situation of Syrian refugee children in the city—which, one may safely presume, is likewise elsewhere in Turkey as well, plus Lebanon and Jordan, not to mention in Syria itself—who have been descholarized in massive numbers, some since the outbreak of the war four years ago. The consequences of this, ça va de soi, will be calamitous—for the children’s futures, the countries in which they live, and Europe and the world—if the international community, such as it is, does not act quickly. Quoting Abdulrahman Kowara, director of the Syrian Education Commission—the de facto educational authority of the Syrian opposition in Syria and Turkey—at the end of the piece

“These children, if left uneducated, will harm Syria, Turkey and the entire world in the future…I see these children as time bombs, ready to explode any time. I see the expression of detachment on their faces. It is up to the world to help the future generations of Syria as much as their own.”

On the subject of Syrian refugees, the German website In a Nutshell – Kurzgesagt, which makes videos “explaining things,” posted a six-minute You Tube last Thursday—which has already been viewed almost 4.5 million times—explaining the European refugee crisis and Syria. It’s good and merits wide circulation, though, for the record, I will quibble with the line about how “[a]ll sides committed horrible war crimes, using chemical weapons, mass executions, torture on a large-scale, and repeated deadly attacks on civilians.” All sides have indeed committed exactions and done very bad things but the lion’s share of this has been the doing of the regime of Bashar al-Assad—and when it comes to the use of chemical and torture on a large-scale, that share is total. The Islamic State would commit worse crimes if it could but, so far at least, the aggregate quantity of its crimes and of persons killed, maimed and/or displaced from their homes as a consequence cannot hold a candle to those committed by the regime in Damascus.

In arguing for generosity toward the Syrian refugees landing on the continent, the video’s authors make this impeccable assertion

Even if the EU alone were to accept all four million refugees and 100% of them were Muslims, the percentage of Muslims in the European Union would only rise from about 4% to about 5%…The European Union is the wealthiest bunch of economies on Earth, well-organized states with functioning social systems, infrastructure, democracy, and huge industries. It can handle the challenge of the refugee crisis if it wants to. The same can be said for the whole Western world.

In a post two years ago on Syria’s Palestinians, I opined that it would behoove the European Union, US, Canada, Latin American states, Australia, and Russia to absorb all 300,000 of them. Comme ça. Can these states—to which one must add those in the OIC who have the means but have so far done little to nothing, but who can and must share in the responsibility—absorb four million Syrians? That’s a lot but what choice is there, as the Syrian war is not going to end anytime soon and what will become of those four million displaced persons in the meantime? But if some kind of international agreement can possibly be worked out on this at some point down the road—when the Syrian refugee crisis has really become untenable—the refugees should be offered choices as to where they want to go—where they have family or support networks, speak the language, and/or will encounter the least difficulties in finding employment, i.e. in integrating into the host society. If refugees are sent to countries—however generous the latter’s intentions may be—where they know no one, don’t speak the language, and are sure to have great difficulties in the labor market, there will be problems, as one learns in this report in Le Monde last week.

À propos of all this, see these two reportages—here and here—on the France 2 news this evening. Je n’ai rien à dire de plus.

Syrian refugees, Istanbul (photo credit: Vocativ/Jodi Hilton)

Syrian refugees, Istanbul (photo credit: Vocativ/Jodi Hilton)

Syrian refugees, Istanbul (photo credit: DHA Photo/Hakan Kaya)

Syrian refugees, Istanbul (photo credit: DHA Photo/Hakan Kaya)

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Arabian Nights

As Mil e Uma Noites Vol1 O Inquieto

Volume 1, The Restless One. This is the first part of a trilogy, or triptych, by Portuguese director/auteur Miguel Gomes, which opened in Paris last month to dithyrambic reviews. As I have been more or less riveted to Greece and the EU over the past three or so weeks, it seems logical to have a post on this film and at this moment, as its subject is precisely the deleterious effects that the European Union’s austerian policies have had on Portugal with the crisis that began in 2008-09.

The film is an original—if not idiosyncratic—presentation of the manner in which the crisis has affected that country. Quoting from this pre-projection dispatch in Screen Daily

Portuguese filmmaker Miguel Gomes’ Arabian Nights, a contemporary re-telling of One Thousand and One Nights, is set to premiere in Directors’ Fortnight, a parallel section of the Cannes Film Festival (May 13-24).

Arabian Nights, the film – or, even better, the three miraculous films – by Miguel Gomes, will be premiering at the Directors’ Fortnight,” said Directors’ Fortnight artistic director Edouard Waintrop.

“The breathtaking triptych is inspired by the tales told by Scheherazade and by some events that occurred in Portugal between 2013 and 2014, while the country was subjected to a political power denying all forms of social justice. It will set the pace of our program. Each film, directed with a wild fantasy and a great freedom, will have its day.”

Set against the background of the economic crisis in Portugal, a contemporary Scheherazade paints a picture of the country’s woes, across three episodes: Volume 1, The Restless One; Volume 2, The Desolate One; and Volume 3, The Enchanted One.

The Portuguese economic and social crisis, recounted via The Arabian Nights‘s Scheherazade, updated for our present era and with stories that have actually happened in Portugal these past few years. What an original idea for a film. And Hollywood press critics, who saw “Volume 1” at Cannes, indeed piled on the praise. Variety’s Jay Weissberg, whose reviews are always reliable, thus began his

The first installment of Miguel Gomes’ trio of pics acts as a melancholy paean to a broken Portugal and a denunciation of European financial control.

The number of films dealing head-on with the global economic crisis have been shockingly few, leaving the field wide open for someone with the creative complexity and storytelling verve of Miguel Gomes, whose three-part “Arabian Nights” tackles the subject with characteristic imagination and, unsurprisingly, righteous anger. While too early to tell how the trio of pics hang together, it’s possible to say from “Arabian Nights: Volume 1, The Restless One,” that audiences are in for a meaty opus that weaves actuality and allegorical fantasy into an outraged portrait of European austerity, witch doctors, the Portuguese politicos at their beck and call, and, most importantly, the unemployed masses. (…)

And this from The Hollywood Reporter’s Boyd van Hoeij’s review’s “Bottom Line”: “People in crisis and flights of fancy come together in this frequently fascinating collage of stories.” And then there’s Indie Wire’s Oliver Lyttelton, who simply said that Miguel Gomes’s triptych was “astonishing.” No less.

As the last film I saw by Miguel Gomes, the 2012 ‘Tabu’, was quite good and original, and in view of the US reviews (always more reliable than the French), I assumed this one would be a guaranteed thumbs up.

The verdict: I found it incomprehensible. I didn’t understand what was happening in the film (made up as it is of several vignettes, all allegories; trailer here). I ceased trying to follow it after some twenty minutes, as I couldn’t make sense of the story (as there didn’t appear to be one). I could have walked out of the theater (sparsely attended, and on opening day) at any moment but stuck it out to the end, though for no good reason, as I was bored to tears for the two long hours. So for the first time in my recent movie-going history, I am obliged to part company with Jay Weissberg. Gomes’s film is one for critics, not audiences. And I am manifestly not alone, as after four weeks in the salles, barely 29,000 have seen it in all of France (cf. ‘Tabu’, which attracted 144K spectateurs during its run; for this latest one, Allociné spectateurs are decidedly less enthusiastic than the critics). In France that is called an échec, i.e. the pic has bombed, and among its natural audience of highbrow cinephiles.

The second “volume” of the triptych opens next week. I think I’ll skip it. And I certainly won’t be the only one.

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Grexit or Gerxit? Ashoka Mody, visiting professor in international economic policy at Princeton—and previously of the IMF—writes in Bloomberg View that “Germany, not Greece, should exit the euro.” Those who read the NYRB will remember George Soros’s essay three years ago, “The tragedy of the European Union and how to resolve it,” in which he proposed precisely this solution: that either Germany assume its role as a benevolent hegemon and with the attendant responsibilities—here, to shore up Greece over the long run—or exit the euro.

At the risk of engaging in crass essentialism, Germany seems incapable of the former, as its only historical experience as a hegemon has been to militarily conquer countries and then brutalize them. So failing to be a benevolent hegemon, Germany should indeed consider quitting the euro (perhaps accompanied by fellow travelers Finland, Slovakia, and maybe the Baltic states) and reverting to its beloved Deutsch Mark, the immediate consequence of which would be a sharp increase in the value of the DM and with the euro plunging, but with the respective currencies, after a couple of years of chaos, finding their equilibrium.

Realistically speaking, though, Germany is not going to quit the euro. No one outside the pages of intello journals and webzines is proposing it. It is not on any agenda and is simply not going to happen. But as Germany is not going to act the benevolent hegemon as Soros suggests—and despite its “moral obligation to Greece,” as FP editor Daniel Altman puts it—the only alternative, in view of the manifest absurdity of the latest bailout agreement—a.k.a. the Agreekment, which no serious person thinks will be implemented, or can be—is Grexit. As Ambrose Evans-Pritchard put it on Thursday

What Greece is being asked to do is scientifically impossible. Almost everybody involved in the talks knows this. Yet the lie goes on because the dysfunctional nature of EMU politics and governance makes it impossible to come clean. The country is dishonestly kept in a permanent state of crisis.

Wolfgang Schauble is one of the very few figures who has behaved honourably in this latest chapter. As readers know, I have been highly critical of the hard-bitten finance minister for a long time, holding him directly responsible for the 1930s regime of debt-deflation and contraction imposed on much of Europe, and for refusing to accept that the eurozone’s North-South divide must be closed by both sides. Any policy that puts all the burden of adjustment on the South is destructive and doomed to failure.

But he is entirely right to argue that a velvet divorce and an orderly exit from the euro for five years would be a “better way” for Greece, as he did on German radio this morning [July 16th].

It would allow the country to regain competitiveness at a stroke without a disastrous over-shoot or the risk that events might spin out of control. It would clear the way for proper debt relief – or a standard IMF-style package. (…)

If accompanied by some sort of Marshall Plan or investment blitz – as Mr Schauble appears to favour – it would set the foundations for genuine recovery.

Huge sums of Greek money sitting on the sidelines would probably flood back into the country once the Grexit boil had been lanced. It is a pattern seen time and again in emerging markets across the world over the past 60 years. (…)

Perhaps. For Grexit to happen, there would have to be at least a ten or twenty year moratorium on interest payments on Greece’s debt, not to mention a scrapping of the impossible €50 billion privatization fund contained in the current agreement.

If one didn’t see it, AEP had a hard-hitting, must-read column on Wednesday on how “EMU brutality in Greece has destroyed the trust of Europe’s Left.” The lede: “The Left let itself become the enforcer of reactionary policies and mass unemployment because of the euro. Greece has broken the spell.” Ouch!

Here’s DSK, in an open letter “To my German friends” posted on Twitter, skewering the Agreekment.

The well-known French specialist of geopolitics, François Heisbourg, had an FT op-ed the other day on “The end of an affair for France and Germany.” His conclusion:

Unfortunately, by having avoided what they loathe — debt forgiveness — the Germans may now be hoist with their own petard. Adding billions to Greek debt, enforcing pro-cyclical pension cuts and tax increases in the middle of renewed recession, and positing as in 2011 a €50bn privatisation programme: this is as unlikely to work now as it was in the past. Now it has acquired the formal status of plan B, Grexit is likely to come back. France would then be faced with an impossible choice: to flow with the German-led tide of Grexit, clearly as a subordinate, or to fight a losing battle to prevent a country from being forced out of the European family.

Even Franco-German co-management may not be up to striking a workable compromise. The change behind the scenes is that the Paris-Berlin bond can no longer take strength from the shared project of European integration: France’s 2005 rejection of the proposed EU constitution was a turning point. The relationship has instead become utilitarian and as a result the EU’s days of ever closer union may be at an end.

For a reminder of the intimate involvement of outside actors in the Greek tragedy, see Robert Reich’s piece in The Nation on “How Goldman Sachs profited from the Greek debt crisis.” The lede: “The investment bank made millions by helping to hide the true extent of the debt, and in the process almost doubled it.”

And then there were the 2004 Olympics, which, in the words of freelance journalist Peter Berlin, “rotted Greece.” He poses “the obvious question: Should the International Olympic Committee shoulder some of the blame?” The answer too is obvious. But will the IOC ever shoulder any of the blame? Poser la question c’est y répondre.

Le Monde’s Alain Frachon, in a column dated July 9th, “Grèce, torts partagés,” had this

De Tokyo et avec le recul que confère la distance, le politologue franco-américain Robert Dujarric observe: «Tout le monde sait depuis le XIXe siècle que la Grèce est un Etat dysfonctionnel. Mais depuis son admission, l’UE n’a fait aucun effort pour la moderniser. L’abandonner maintenant serait comme un couple qui a adopté un enfant handicapé et décide de s’en séparer comme on jette une batterie usagée.»

«Au plan moral, les dégâts [du Grexit] pour l’Allemagne seraient incommensurables», dit le politologue Hans Stark, de l’IFRI, sur le site Boulevard extérieur qu’anime Daniel Vernet, grand familier des affaires hellènes. L’Allemagne se verrait reprocher de «n’avoir pas su prévenir un divorce entre peuples, opinions publiques et gouvernements du sud et du nord de l’Europe» ou, poursuit Stark, «de ne l’avoir pas voulu, par crainte de déplaire à une partie de son électorat et de sa classe politique».

Ben Bernanke, formerly chairman of the Fed, has a worthwhile post on his Brookings blog, “Greece and Europe: Is Europe holding up its end of the bargain?” His conclusion:

I’ll end with two concrete proposals. First, negotiations over Greece’s evidently unsustainable debt burden should be based on explicit assumptions about European growth. If European growth turns out to be weaker than projected, which in turn would make it tougher for Greece to grow, then Greece should be allowed greater leeway after the fact in meeting its fiscal targets.

Second, it’s time for the leaders of the euro zone to address the problem of large and sustained trade imbalances (either surpluses or deficits), which, in a fixed-exchange-rate system like the euro zone, impose significant costs and risks. For example, the Stability and Growth Pact, which imposes rules and penalties with the goal of limiting fiscal deficits, could be extended to reference trade imbalances as well. Simply recognizing officially that creditor as well as debtor countries have an obligation to adjust over time (through fiscal and structural measures, for example) would be an important step in the right direction.

Putting forth the libertarian perspective, Cato Institute Senior Fellow Alan Reynolds asserts in Politico that (surprise!) “Greece is being taxed to death.” The lede: “No debtor ever became more creditworthy by being forced to accept less income.” Sounds right to me.

Also writing in Politico, James K. Galbraith, the well-known UT-Austin econ prof and Yanis Varoufakis’s BFF, says (surprise!) that Greece faces a “death spiral ahead.” The lede: “How the latest ‘solution’ to the debt crisis locks Europe into a grim next chapter.” Yep.

In a similar vein, see the analysis by the très gauchiste New School for Social Research econ prof Sanjay Reddy, writing on his Reddytoread blog, “Greece and the Eurozone: The real stakes.”

On why Germany is being so tough on Greece, investigative journalist Dick Laabs, writing in The Guardian, says to “Look back 25 years: To understand Wolfgang Schäuble’s demands in the bailout talks, look at what he inflicted on his own country when it reunified.”

For an explanation of German views of Greece by a historian and specialist of Germany, see the interview in Libération with Johann Chapoutot, who teaches at the Université Sorbonne-Nouvelle, “‘Pour les Allemands, les Grecs d’aujourd’hui ne sont pas à la hauteur des Grecs anciens’.”

Looking at the other side of the equation, Pavlos Eleftheriadis, who is a barrister and Fellow of Mansfield College, Oxford—and an activist in the Greek center-left party To Potami—insists, in an op-ed in The Telegraph, that “Greece is a victim of its own cronyism and corruption.” The lede: “Postwar Greece never established welfare systems or open institutions—now it’s paying the price.”

Finally, see the essay in OpenDemocracy by Ronald G. Asch, professor of early modern history at the University of Freiburg: “The decline and fall of the European Union: is it time to rip it up and start again?” The lede: “There was no distinction in EU politics between friend and foe. Everything worked so nicely. But this was also the reason why nobody was greatly interested. This has definitely changed now.” I read Asch’s piece quickly, noting a number of interesting points. Now I have to go back and reread it carefully.

UPDATE: So how is the Agreekment playing in Greek public opinion? According to a poll, 70% are for, with only 24% for default and Grexit. And another poll shows Syriza’s popularity to be up. Stathis Kalyvas’s comment on this: “Greece shows that you can strike a heavy austerity bailout deal that goes against your stated principles and promises and gain in popularity.”

2nd UPDATE: Pierre Crétois, an agrégé in philosophy, has a philosophical meditation in Slate.fr, “Grèce: Et si on n’avait rien compris à la dette?” The lede: “Tout le monde part du principe que la Grèce, débitrice, est responsable du remboursement. Mais le créancier est lui aussi responsable de la dette. Petit rappel philosophique de ce qu’est une dette, de ses enjeux et de sa violence.” Haben Sie Französisch, Herr Schäuble lesen?

3rd UPDATE: Here are links to a few pertinent articles and tribunes in Le Monde from the past three weeks—and which are not too tender toward Greece:

Marie Charrel, “La Grèce a perdu toute la richesse gagnée depuis son passage à l’euro” (July 4th). The lede: “Athènes a utilisé les facilités de la monnaie unique pour accroître les salaires et les dépenses publiques, laissant gonfler les déficits.”

Annick Cojean et Adéa Guillot, “Le système politique grec miné par le clientélisme et la corruption” (July 5th). The lede: “Les réformes destinées à favoriser la méritocratie et la transparence n’ont pas été entreprises.”

In other words, an absolutely colossal, astronomical amount of European money has been wasted in Greece—gone up in smoke—since it joined the euro, as, entre autres, Greece utterly lacked the political and state institutions that should normally have been a precondition for membership in the Eurozone. So does Europe (Germany, France et al) bear at least some of the responsibility for this?

On Greece spending colossal European transfers to no productive end, see the tribune by Christian Saint-Etienne, who holds the chair in economics at the CNAM in Paris, “Athènes est responsable de ce que lui arrive” (July 15th). Money quote:

La Grèce s’est mise largement toute seule dans sa situation actuelle, car le pays a bénéficié de 200 milliards d’euros de fonds structurels depuis son entrée dans l’Union européenne et n’a pas su développer une économie compétitive. L’Etat est structurellement faible et l’évasion fiscale, considérable. Depuis la crise de 2009-2010, la Grèce a bénéficié d’une remise de dette de 105 milliards d’euros par les banques en 2012 et de réductions de sa charge d’intérêt qui porte l’aide accordée au pays à environ 175 milliards d’euros. Si on ajoute les 200 milliards de transferts structurels, la Grèce a déjà obtenu une aide de l’Union européenne de 375 milliards d’euros, supérieure au double de son PIB actuel !

Arrêtons de dire que le pays est écrasé par l’Europe alors que la Grèce ploie sous le poids de son régime oligarchique et du refus de payer l’impôt ! La dette actuelle du pays de 320 milliards d’euros serait de 495 milliards sans l’aide massive déjà obtenue. (…)

La Grèce brûle aujourd’hui du cash au rythme de 20 à 25 milliards d’euros par an. Les banques, qui avaient rétabli leur situation fin 2014, sont à nouveau virtuellement en faillite. Elles devront être recapitalisées à hauteur de 30 milliards d’euros. Même si on réduit sa dette, la Grèce reviendra continuellement tendre la main sans un programme crédible de réformes structurelles. (…)

Those are big numbers there.

4th UPDATE: Fernando Betancor, an American economist living in Madrid, has an essay in OpenDemocracy (July 17th), “Germany’s demographic challenge,” in which he argues strongly against a hypothetical return to the Deutsche Mark. The lede: “Germany is by no means an unstoppable juggernaut, and the re-erection of trade barriers across the continent and a return to a strong Deutschmark would ravage the economy.”

5th UPDATE: On Project Syndicate, Harvard Kennedy School economics prof Jeffrey Frankel asks “Is Tsipras the new Lula?” (July 17th) and Jeffrey Sachs weighs in on “Germany, Greece, and the future of Europe” (July 20th).

6th UPDATE: The New Yorker’s James Surowiecki has an interesting, worthwhile piece in the issue dated July 27th, “How can Greece take charge?” The lede: “If Europe won’t help, the only option is reshaping the economy.”

7th UPDATE: University of Pennsylvania poli sci prof Julia Gray has a post on WaPo’s Monkey Cage blog on “How Greece’s credit went south” (July 20th).

8th UPDATE: Professors Vassilis K. Fouskas and Constantine Dimoulas, respectively of the University of East London and Panteion University in Athens, have a sharp and worthy article—in which they make a number of good points—in OpenDemocracy, “Greece has two choices, and so do the creditors” (July 21st). The lede: “After 13 July 2015, Syriza’s Greece and, for that matter, the creditors have two choices. Modernise the Greek state; or let Greece default and risk disintegration not just of EMU/EU but also Nato.”

9th UPDATE: Kathleen McNamara, who teaches government and international affairs at Georgetown, has a smart, must-read post on WaPo’s Monkey Cage blog (July 21st), “This is what economists don’t understand about the euro crisis – or the U.S. dollar.”

10th UPDATE: Anatole Kaletsky, who, entre autres, chairs the governing board of the Institute for New Economic Thinking (co-founded by George Soros), has a commentary in Project Syndicate (July 22nd) on “Why the Greek deal will work.” This one merits reading.

11th UPDATE: Libération’s incontournable Jean Quatremer has, on his Coulisses de Bruxelles blog, a lengthy, unsparing critique (July 24th) of the current Greek prime minister and his action since taking office in January, “La déroute d’Alexis Tsipras.” Quatremer’s demolition of Tsipras and Syriza is a must-read, so please take the time to do so.

12th UPDATE: Joschka Fischer has a commentary in Project Syndicate (July 23rd) on “The Return of the Ugly German.” See also Zeit Magazin’s graphic novel “Game of Greece” (July 23rd; translated from the German). The lede: “The rise and fall of Greece explains a great deal about Europe, politics and power – in a way not unlike ‘Game of Thrones.’ An illustrated guide throughout the crisis.”

13th UPDATE: Now here is a totally excellent, absolutely must-read article, published on the website of the Harvard Business Review (July 27th), “Greece’s problem is more complicated than austerity,” by Michael G Jacobides, who is Associate Professor of Strategy and Entrepreneurship, plus Sir Donald Gordon Chair of Entrepreneurship and Innovation, at the London Business School. And he’s Greek. Please read it. Now.

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Today is Bastille Day. La fête nationale. I would normally have a special post on it—as I have every July 14th since AWAV was launched—but not this year. Am too distracted by Greece. And Europe. À propos of this, here’s an on-target commentary I came across earlier today, “Tormenting Greece is about sending a message that we are now in a new EU,” by the well-known Irish Times columnist Fintan O’Toole. He starts

What’s the difference between the Mafia and the current European leadership? The Mafia makes you an offer you can’t refuse. The leaders of the European Union offer you a deal you can neither refuse nor accept without destroying yourself.

The European Union as we have known it ended over the weekend. That EU project was all about the gradual convergence of equal nations into an “ever closer union”. That’s finished now.

Read the whole thing. As an observer in one of the PIGS, O’Toole knows of what he speaks. And in addition to being a sharp analyst, he has a fine sense of le second degré, as one may glean in this tweet

#Greece should have declared itself a bank. Would have been bailed out no questions asked.


Simon Tilford, the deputy director of the Centre for European Reform in London—the best think tank on the EU—has an op-ed in today’s NYT, “The Eurozone’s fault lines,” in which he begins with this

The euro was supposed to boost European economic growth and living standards, strengthen public finances and hence the sustainability of welfare states. Politically, it was supposed to bring the European Union’s member states together, and prevent a newly united Germany from becoming too dominant. But the opposite has happened.

The hoped-for convergence in living standards between richer and poorer members of the eurozone has failed to materialize. Far from the single currency nurturing a European polity, relations between northern and southern countries have never been more fraught. And the crisis has put the burden on a German leadership that is poorly equipped to exercise it.

On relations between the EU north and south, see the piece in Foreign Policy on the goddamned f*cking Finns, “Tiny Finland could complicate new Greek bailout deal.” Anyone for a #finexit? (just kidding) Europe is doomed if populist politicians in little EU countries gain the ascendancy in the European Council and Eurogroup.

CER analysts Christian Odendahl and John Springford, writing on the CER website, assert that “The Greek bailout deal resolves nothing,” that “[e]ven if the new bailout makes it through the Greek parliament in coming weeks, the programme’s economic incoherence will make it fall apart.” And in the same vein, Barry Eichengreen, writing in Social Europe, argues that to save Greece is to save Europe.

While one is at it, see as well the comment by Social Europe editor-in-chief Henning Meyer, “What are the consequences of the Greek deal?” Also the piece by WaPo Wonkblog reporters Roberto A. Ferdman and Matt O’Brien, “How Greece became the worst economy in Europe.”

À suivre.

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It’s only a matter of time. The European Council may have reached its last-minute deal to avert a Grexit this month—with the certain calamitous consequences for Greece and the rest of Europe this would have entailed—but the damage has been done. This past week has to have been the worst ever in the 65-year history of the construction of Europe. What has happened is a disaster for Europe—for the idea of Europe, if that still means anything. Arthur Goldhammer is right in saying that “the euro [may be] saved, but the euro, it is now clear, is going to be a thorn in Europe’s side if not a spike in its heart for years to come.” How can it not be, with people like Wolfgang Schäuble and Jeroen Dijsselbloem all but calling the shots? Of course the successive governments in Athens have been hugely responsible for what has happened but still, who do the f*cking Finns and Slovaks think they are to lecture the Greeks and threaten them with expulsion from Europe? Who the hell does Alexander Stubb think he is to be reading the riot act to anyone outside his little country? And for the big country in Europe—Wolfgang Schäuble’s—to be humiliating a member EU state—or any state, for that matter? Art Goldhammer nailed it again

[The deal] was nothing less than a humiliation of a small and suffering member state, a sadistic display of naked financial power. Do as we say or we will “collapse your banks,” Eurogroup Chairman Jeroen Dijsselbloem had apparently told Greek negotiators earlier. In the climactic weekend it emerged that he wasn’t bluffing. Despite the fact that the ‘No’ vote had scored a resounding victory in a national referendum a week earlier, Greek Prime Minister Alexis Tsipras decided he had no choice but to surrender to all the creditors’ demands, but in the end it turned out that even unconditional surrender was not enough.

Germany’s implacable finance minister, Wolfgang Schäuble, saw weakness in his opponent and went for the jugular. He insisted on “guarantees” that Greece would keep its word, including sequestration of Greek assets in a fund under his control. No such guarantees had been demanded previously, but now Chancellor Angela Merkel, who had previously seemed less exigent than Schäuble, declared that Greece had forfeited the “trust” of its European partners. In the end she proved to be a good German but not a good European.

As for what happened in Brussels last night, the FT thus reported

“They crucified Tsipras in there,” a senior eurozone official who had attended the summit remarked. “Crucified.”

Wolfgang Münchau has an awesome FT tribune today, “Greece’s brutal creditors have demolished the eurozone project.” No money quotes, as the whole piece is one. Just read it. All of it.

This social media comment by Yascha Mounk, a recent Harvard Ph.D. who teaches political theory in the Government Dept there (and who’s German)—no doubt reflects the sentiments of many

It’s strange to think that, back when I was a teenager, the European project still seemed like the kind of thing to which one might nobly devote one’s life. But the European dream is dead—not just because of Greece, but because of the depth of nationalism the euro crisis has revealed, and the ugly hatred it has incited.

The best we can now hope for is an orderly slimming of the EU to its key achievements: free movement of people, coordination on the most important regulations, etc. (I deliberately exclude political values: as the case of Hungary shows, the EU is incapable of safeguarding those in any case.) But the centrifugal forces, and the strength of the populists, will be such in the next years that we may wind up losing even that.

Again, the posture of Germany and its little country allies may have killed the European idea. As for big country France, I shudder in anticipation of the coming public opinions polls on attitudes toward Europe. Revulsion is all but guaranteed. And in polls outre-Manche, Brexit will no doubt leap.

It’s now beyond doubt that the euro has been “a curse,” as retired longtime Christ Church, Oxford, economics professor Peter Oppenheimer asserted recently.

N.B. the euro, not Europe; not the European idea. The problem is not the Treaty of Rome or even the Single European Act; it’s Article 109 of the Maastricht Treaty, and all that ensued from that.

The Telegraph’s Ambrose Evans-Pritchard, in a comment entitled “Greek deal poisons Europe as backlash mounts against ‘neo-colonial servitude’,” weighs in on the deal. E.g.

“Greece has been devastated and humiliated. Europe has showed itself Pharisaical, incapable of leadership and solidarity,” said Romano Prodi, the former Italian prime minister.

An independent fund will take control of €50bn of Greek state assets, collateral to prevent Syriza reneging on the deal at a later date. Three-quarters of this will be sued to recapitalise the Greek banks and repay debt.

International inspectors will have the power to veto legislation. The radical-Left Syriza government will be forced to repeal a raft of laws passed since it took power in January, stripping away the last fig leaf of sovereignty.

“It is unconditional surrender. We get serious austerity with no debt relief. We will have foreign supervisors crawling over everything,” said Costas Lapavitsas, a Syriza MP and one of 40 or so rebels who plan to abstain or vote against the deal, mostly from the Left Platform.

“They are telling us that from now on, they are going to govern the country…”

In the plan is a provision for ending laws against Sunday trading. Rhetorical question: What does having stores open on Sundays have to do with economic growth and/or reimbursing national debt? Concrete question: Are stores in Germany open on Sunday? Answer here.

Back to Ambrose Evans-Pritchard, TWS senior editor Christopher Caldwell, in a piece on Greece in the latest issue—in which valid points are mixed with Eurosceptic pablum and other silliness—writes this

Ambrose Evans-Pritchard of London’s Daily Telegraph has therefore asked whether we are right to focus on Greece at all. Evans-Pritchard is a conservative writer whose well-informed essays on European finance are a bracing contrast to the conservative sloganeers in the United States, who often write as if the virtuous party in any dispute were always the one with the most money. “The currency union itself is delinquent,” Evans-Pritchard asserts. He is right. Greeks could borrow what they did because they were now members of a rich family. If Brad Rockefeller walks into a casino in a soiled T-shirt and runs up a million-dollar debt that neither he nor his family will repay, what was the casino’s mistake? Trusting some T-shirt-wearing guy or trusting the Rockefellers?

In the Paris business daily La Tribune, Romaric Godin asserts that “La défaite de la Grèce [est] la défaite de l’Europe.” Disheartening reading but necessary. See also Godin’s piece from last Friday—an eternity ago—”Grèce: où Alexis Tsipras veut-il en venir?

I’ve been ranting here but so be it. I’m really quite dismayed and dejected about all this.

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