the aimless europe

Dora Longo Bahia, Liberdade (project for Avenida Paulista II), 2020 Acrylic, water-based pen and watercolor on paper 29.7 x 21 cm
Whatsapp
Facebook
Twitter
Instagram
Telegram

By GILBERTO LOPES*

Germany and England express the stagnation and decline of the Old Continent

"Angela Merkel's term will be remembered as the most paradoxical and cruel in Germany and Europe," said former Greek economy minister Yanis Varoufakis, the main opponent of the draconian adjustment program that Germany and the European Union imposed on Greece. in 2016. Merkel “dominated European politics like no other peacetime leader”. But, according to Varoufakis, it did so in a way that doomed Germany and Europe to stagnation and decline.[I]

He blames her for having provoked a humanitarian crisis in his country to hide the rescue of German bankers, whose policies, in his opinion, “border on criminality”. He accuses her of having sabotaged “every opportunity to unite Europeans”, of having conspired to prevent any green transition in Germany or Europe, of “having worked tirelessly to emasculate democracy and prevent the democratization of a hopelessly undemocratic Europe”.

There is no doubt that Germany is stronger politically and economically today than it was when Merkel took office in 2005, says Varoufakis. The secret, he says, lies, among other things, in a trade surplus, which has had a devastating effect on other European economies, and in controlling spending, unprecedented austerity measures that have mainly affected the German and European working class. Mainly the Greek one, which was submitted to a drastic adjustment program in exchange for billionaire resources, which, after passing through the Greek banks, went to their true recipients, mainly German and French creditors. Varoufakis says that Greece alone owed 102 billion euros to German banks which, without the rescue plan launched by Merkel, risked facing the radical consequences of their risky investments.

Unaware that they were actually paying for the mistakes of French and German bankers, the Slavs and the Finns, the Germans and the French believed they were carrying the happy accounts of another country, says Varoufakis. European citizens were sold the idea that the crisis was the result of waste by governments in southern countries, accustomed to spending more than they had. An assertion that, as several economists have demonstrated, has no support. Thus, says Voroufakis, "Merkel sowed the seeds of hatred among the proud peoples of Europe." On regional debt, a group of XNUMX European economists published a document in February in which they called for “the cancellation of the public debt held by the European Central Bank (ECB) so that our destiny returns to our own hands”[ii].

Vertigo

Now that she is gone, Merkel's legacy is the subject of debate in Europe, where the formation of the government that will succeed her, after the German elections of September 26, is eagerly awaited. Europe faces “the vertigo of the post-Merkel era”, says Beatriz Navarro, Brussels correspondent for the daily La Vanguardia. Navarro attributes to analysts, diplomats and senior officials from several European countries, interviewed by her, the expectation that her successor will have the geostrategic vision “that Merkel never had”. The challenge will be “to clearly position itself in the face of the great geostrategic challenges it faces: the contempt of the United States, the rise of China, the constant dispute with Vladimir Putin’s Russia…”.

A similar opinion was expressed in an editorial by the TheObserver, do The Guardian Londoner: “Merkel, a successful consensus builder, has helped to hold the European Union together during successive financial, migration and pandemic crises”. But they do not fail to point out that, on the other hand, “its lack of strategic vision is notorious”. Adam Tooze, director of the European Institute at Columbia University, predicts the end of an era in which the left-right political debate (in Germany, that means between Social Democrats and Christian Democrats) has been repressed. Three of the four Merkel-led governments have been in alliance with the Social Democrats. But that is already behind us.

It wasn't the Christian Democrats who ended the left-right divide at the center of German politics, says Tooze. It was the SPD social democrats who turned to neoliberalism during the Gerhard Schröder government (1998-2005). Together with his British colleague Tony Blair, they created the so-called “third way”, the neoliberal formula of the European social democrats, not very different from those adopted in several Latin American countries – among them Costa Rica, Mexico or Chile – by parties that claim a social-democratic orientation. “There is consensus among analysts that Merkel has made political profit from the labor market and welfare state reforms that Schröder and his ecologist partners have launched to spur economic growth and reduce unemployment. These reforms, a package of measures called Agenda 2010, harmed the most modest and vulnerable population – the so-called mini-jobs were created, jobs with a salary below 450 euros a month with almost no contribution – and explain, to a large extent, the German economic miracle," says María Paz López, correspondent for the La Vanguardia in Berlin.

Tooze recalls that Olaf Scholz was SPD general secretary during Schröder's government. Blair also reappears in British laborism, which has just held its conference in Brighton, defended by the general secretary, Keir Starmer. The conference ended badly for Starmer, defeated in his proposal to change the weight of votes to elect party leadership. The idea was to return to an old sectoral voting system that re-established the weight of the parliamentary vote, making it more difficult to elect representatives of left-wing sectors of the party, such as former general secretary Jeremy Corbin.

new government

In Germany, for now, Merkel's successor appears to be Scholz, the Social Democrat candidate and finance minister in the current coalition government, in which they spearheaded the conservative Christian Democrat party. The slight advantage of his party (25,7% against the 24,1% of the CDU-CSU coalition) gives him preference for the formation of the government. Something that will take time (it wouldn't be strange if we had to wait until the end of the year, or more), in the framework of traditional negotiations to form a government in Germany. Scholz has several options, but the one that appears to be on the table first is with the Greens (14,8%) and the FDP Liberals (11,5%).

Christian Lindner, president of the FDP, has expressed his desire to take over the finance ministry, Scholz's current post, on the campaign trail. He has vowed not to raise taxes and to take a hard line on debt. According to European rules, it should not exceed 60% of each nation's GDP. But even before Covid-19, some did not meet this limit. Today, France, Italy, Spain, Belgium and Portugal have deficits in excess of 100% of their GDP. “If the German finance minister supports the small conservative EU states that are calling for a return to an orthodox fiscal policy, it will be a disaster for Europe”, warns Tooze.

Reopening the left-right debate has risks for German politics, he adds. But there are also risks in thinking that these differences are not real. "It is no exaggeration to say that Europe's future is at stake." Looking at the German political scene, Varoufakis is less optimistic. He is relentless with Merkel. But looking at the gaggle of "crass and bureaucratic" politicians who are scrambling to replace her, he says, "perhaps soon I will think more fondly of her tenure."

For Ignacio Molina, professor at the Autonomous University of Madrid (UAM), researcher at the Real Instituto Elcano and editor of Public Agenda, Merkel's replacement will not find a placid outlook. Its main challenge will be “overcoming the pessimism about the future that today dominates vast sectors of German society and that is reflected in the gloomy demographic projections or in the difficulties to preserve coexistence in a country called to be necessarily multicultural”. Molina lists a series of challenges, but concludes by indicating that of positioning the country in the new international order and determining the future of relations with the United States in the context of renewed tensions with China and Russia.

Across the English Channel

Gone are the days when British newspapers could print headlines like “Snow in the Channel, continent isolated”. Queues of cars at gas stations and empty shelves in supermarkets were not common images in countries like England. But now they are.

Difficulties in supply chains, responsible for the shortages, could last until Christmas, said British Prime Minister Boris Johnson. According to the British press, people fought at gas stations while teachers and health professionals were unable to carry out their daily tasks. The stores will not be empty, but the amount of products available will be reduced.

For the columnist The Guardian Jonathan Freeland, the cause of shortages of fuel and products in supermarkets is Brexit. Empty shelves in supermarkets, as well as pubs short of beer, are the result of problems in supply chains. “In other words, the lack of truck drivers,” says Freeland.

A gray picture for England was also painted by Steve Smith, a member of the Center for Research in Political Economy, writing for the with the BBC. “Eighteen months after the Covid-19 pandemic, another very difficult winter looks increasingly likely, with fears of a resurgence of the virus, combined with rising inflation and an energy and supply chain crisis,” he said.

A faster-than-expected economic recovery put pressure on commodity prices. The price of gas has nearly tripled in Britain since the start of the year. “Brexit has made the whole situation worse because many workers in the food supply chain were from the continent and no longer have permits to work in the UK”.

On the other hand, “to maintain the economy, the Bank of England has, in recent years, cut interest rates to historic lows and injected huge amounts of money into the economy in the form of quantitative easing”. An increase in interest rates could mean that future public debt will also become more expensive, prompting the government to further restrict public spending.

Public sector payments are likely to be reduced, as was the case in the last expenditure review, and if inflation remains high, "it will result in a significant cut in wages in real terms". In this scenario, it was expected that English labor would focus its attention on the crisis facing the country. But it hasn't been like that.

Keir Starmer, its general secretary, attempted a coup at the Labor conference to reinstate a weighted voting system for electing party leadership. The maneuver aimed to reduce the possibilities of the left within the party. But Starmer had to withdraw his proposal in the face of union opposition. He also tried to rehabilitate former Prime Minister Tony Blair, the same man who, along with US President George W. Bush and Spanish Prime Minister José María Aznar, assured the world that they had real news about weapons of destruction in mass of Iraq, which they used to justify the invasion of that country.

After a decade of the party trying to erase Blair's memories, Starmer set out to reclaim his legacy. The result is that, far from its promise to unite Labor after years under the leadership of Jeremy Corbyn, the party ended up "more divided than ever", according to the leaders and journalists who followed the conference. Now we will have to wait for the French elections in April to place one more piece on a chessboard where the fate of Europe is at stake.

*Gilberto Lopes is a journalist, PhD in Society and Cultural Studies from the Universidad de Costa Rica (UCR). author of Political crisis of the modern world (Uruk).

Translation: Fernando Lima das Neves

Notes


[I] See “Angela Merkel”. Available in https://aterraeredonda.com.br/angela-merkel/?doing_wp_cron=1633549022.0865349769592285156250

[ii]The text with the list of professional signatories, headed by Thomas Piketty, can be seen here: https://elpais.com/opinion/2021-02-04/anular-la-deuda-publica-mantenida-por-el-bce-para-que-nuestro-destino-vuelva-a-estar-en-nuestras-manos.html.

See this link for all articles

10 MOST READ IN THE LAST 7 DAYS

______________

AUTHORS

TOPICS

NEW PUBLICATIONS