It is Politics, Stupid!

CREDIT: ANADOLU AGENCY
CREDIT: ANADOLU AGENCY

“I really cannot remember, in all my time in European politics, whether I have come across a situation like this. This is really all about the European Union. If the EU is going to have any credible force, it is going to have to demonstrate it is capable of solving its own problems.” – President Martin Schulz on July 12th, 2015 during the Euro Summit Meeting

Forget about economics, finance, banking regulations, social welfare policies, debt forgiveness; the future of Greece solely depends on politics. “The answer [of endless negotiations on solving the Greek crisis these last five years] cannot be found in economics,” writes Yanis Varoufakis, the former Greek finance minister, “because it resides deep in Europe’s labyrinthine politics.” Greece’s destiny is a simple political question based on several concept: trust and confidence.

The Deal

After a week long of back and forth between Greece and the European capitals, Brussels is once again the siege of a Greek marathon. A meeting of the Eurogroup finance ministers started on Saturday, July 11th and ended the next day around 3pm. Ensuing it a general EU summit, with the 28 leaders, was supposed to take place, but was instead cancelled and transformed into a crisis summit of the 19 EU leaders of the Eurozone. The future of Greece as a member of the Eurozone was clearly on the line with a very reticent German team (Chancellor Merkel and her Finance Minister Wolfgang Schäuble proposing an eventual ‘temporary Grexit’).

As reported by the Financial Times, the finance minister negotiations, which were fruitless and tense, let the way to the EU leaders, whom could not do better considering Germany’s position. Until François Hollande, President of France, whom had been extremely active in advising, helping and defending Greece in the last mile, called for a meeting in Tusk’s office. Preisdent Tusk was reported saying “Sorry, but there is no way you are leaving this room” until a deal is reached.

Credit: Aris Messinis/Agence France-Presse — Getty Images
Credit: Aris Messinis/Agence France-Presse — Getty Images

Interestingly enough, Tsipras’ proposal prior the July 11th meeting included: raising the age for retirement; a VAT hike at 23% across sectors; privatization of key sectors of Greek economy; and removal of tax breaks for some Greek islands. These reforms would permit to unlock a third loan package of $59.6bn until 2018. Tsipras’ proposal was highly similar to the one offered by the international creditors. Even Jean-Claude Juncker during the meeting recognized the proposal brought by Tsipras as almost identical to the one put on the table by the creditors weeks earlier. And the President of European Parliament, Martin Schulz, called for avoiding a Grexit and find a solution.

Based on the deal reached on July 13th, the Greek Parliament voted and agreed on July 15th, on the bailout deal, which was approved with a 229-64 majority. However, Tsipras’ party, Syriza, seems to have lost some unity with 32 Syriza MPs defying their leader’s pleas and rejected the deal. Clearly the terms of the bailout are in direct contradiction with Syriza’s policies, beliefs, and promises, as well as sidelining the results of the referendum. These contradictions could push even further the political crisis in Greece and lead to yet another election during the summer.

Chancellor Merkel, the Finish government and others are not convinced about the proposal and especially Greece’s commitment. The Greek drama is taking more than a simple economic/financial turn, it is purely political. It appears that some EU Member States, like Germany, Finland, Slovakia and others, are more inclined to go after Greece and its leftwing government led by Alexis Tsipras, than finding a real deal that would help in the long term the country.

One core reason is trust, or at least ‘lack of trust.’ Some experts have argued that Tsipras was now on Merkel’s black list after his political coup, the referendum. Merkel and others EU leaders do not trust any longer Tsipras and his government. Or even has argued by Yanis Varoufakis, “based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone.”

Death of the European Project?

The Greek file should be considered as an overall failure for the European ethos. Many economists, like Joseph Stiglitz, have been very critical of the negotiation process and the agreed deal. One of the most virulent denunciation of the deal was Paul Krugman, writing that “it’s [the deal] a grotesque betrayal of everything the European project was supposed to stand for.” Even the International Monetary Fund, a global advocate for austerity measures and straightjacket policies, has been critical of the dealbroken_euro_fit calling instead for a huge debt relief for Greece.

Last but not least, Nicolas Gros-Verheyde of Bruxelles2 wonders about a core question: “Is Europe becoming the sum of its egos?” The Greek file embodies more than solving an economic problem, it has become a vicious fight between powerful EU Member States. These egos are affecting their global visions and understandings of the core principles and values of the European endeavor. But right now, the EU is failing at this important crossroad. The EU cannot find a real solution on any major crisis from counterterrorism in Mali, to migration crisis in the Mediterranean, to Ukraine/Crimea, to the domestic rise of nationalism, and naturally Greece. Are politics killing the EU? It certainly looks like it.

(Copyright 2015 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).
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Greece votes Oxi, Europe says Grexit

ATHENS, GREECE - 2015/06/29: The word 'OXI' (NO) written on a banner in front of the Greek parliament.  Greeks demonstrate in Syntagma square in support to a 'NO' vote in the referendum that will take place on the 5th of July, whether to accept the  new agreement between Greece and it creditors. (Photo by George Panagakis/Pacific Press/LightRocket via Getty Images)
ATHENS, GREECE – 2015/06/29: The word ‘OXI’ (NO) written on a banner in front of the Greek parliament. Greeks demonstrate in Syntagma square in support to a ‘NO’ vote in the referendum that will take place on the 5th of July, whether to accept the new agreement between Greece and it creditors. (Photo by George Panagakis/Pacific Press/LightRocket via Getty Images)

“All of us are responsible for the crisis and all of us have a responsibility to resolve it.” – President Donald Tusk, July 7th, 2015

Greek citizens voted in majority Oxi to the July 5th referendum. The question asked by the Tsipras government, which was campaigning for a ‘no’ vote, was yes or no to accepting a continuation of the bailout program with all the austerity measures coming with it (read here a previous analysis). The results were very clear throughout the country with 61.31% for the no vote and 38.69% for the yes vote (see here the map produced by the Gr20150711_woc001_0eek Ministry of Interior showing that the no vote won in each Greek region). Greek citizens felt that the best option – out of two bad – was to reject the terms of the bailout on the table. If for a day the discussion was about the meaning of the ‘no’ vote (is it against the EU, the Euro, or simply a desire to remain a member of the Eurozone), today’s reality is about the future of Greece as a member of the Eurozone. So where do Greece and the EU go from now on?

Negotiations and Survival

In less than two days, a succession of events has taken place. For over five years, it seems that the Greek file was dragging, it has certainly taken an all new meaning and urgency. Prior to the results, Chancellor Merkel of Germany was meeting her counterpart, President Hollande, in Paris in order to find a common ground. The day ensuing the political victory of the Tsipras government, the infamous Greek finance minister, Yanis Varoufakis, announced his resignation. Many advanced that Tsipras had to go in order to demonstrate to his European counterparts that Greece was serious in seeking for a viable option. Varoufakis had gone too far and had lost some of his support within the Eurogroup of finance ministers.

Then on Tuesday, an emergency summit meeting took place with no substantial results.

Credit: Yves Herman/Reuters
Credit: Yves Herman/Reuters

Tsipras was supposed to bring, as highly recommended by the French government, a new proposal. But the summit meeting failed as Athens did not provide an acceptable option. Tsipras has now until Thursday (as requested by Merkel) in order to present a new proposal to his creditors. A failure in finding an agreement could lead to “the bankruptcy of Greece” warned Donald Tusk, the president of the European Council, “and the insolvency of its banking system.” Tusk added that “tonight I [Donald Tusk] have to say it loud and clear — the final deadline ends this week.” On Sunday, as announced by the 19 eurozone countries on tuesday, the 28 EU leaders will be deciding on the future of Greece.

In addition, the New York Times reported that for the first time – at least publicly – the President of the Commission, Jean-Claude Juncker, has announced that he has “a Grexit scenario prepared in detail.” If a Grexit scenario is now on the table, Tsipras will be defending his case before the European Parliament on Wednesday morning.

Consequences of Staying in the Eurozone, or Leaving It?

In the middle of the negotiations and in finding a solution, a key player is the European Central Bank (ECB). Currently the ECB is the institution that is keeping the Greek banks alive by providing liquidity. Because today Greece is unable to borrow money on the international market and the Europeans are the one providing money to Greece in order to have its economy and banking systems going. The ECB will continue to do so if a deal is agreed. However, in the case of a break-up, the ECB will remain a central player as it will stop providing liquidity to Greece. In addition, even if Greece missed its first payment of July 1st to the International Monetary Fund of $1.8bn, the second deadline of July 20th to the ECB of $3.8bn will be key for Greece and the EU.

If Greece wants to stay in the Eurozone, they will have to implement a set of policy measures that will require: tax reforms; fixing the pension program, which will affect early retirement program; labor market practices. Once these are ongoing the international and european creditors will have to give meaningful debt relief.

In the case Greece decides to leave, or is expelled from the Eurozone, then it will have to introduce a new currency. The country will ultimately default on their debts, and will have to create its own economic agenda in order to lay down the foundation for future economic growth. This scenario will naturally require serious structural reforms.

If Size does not matter, Precedent does

The Greek case is not about the size of the Greek economy. In fact the Greek economy only represents 2% of the Eurozone GDP. So far it does not appear that a Greek default could take with it the whole Eurozone and send a massive shockwave throughout the global markets. No, the case of Greece is a matter, for the EU and its Member States, of establishing a precedent. Germany and other wealthy Eurozone members want to avoid such precedent, where a member state refuses to pay its debts and call for a national referendum in order to provide such country leverage at the European level. Chancellor Merkel was correct in claiming that Greece is a sovereign state and has the right to organize such a referendum, however what type of legitimacy does that provide the Tsipras government in coming back at the bargaining table?

The Greek referendum is national decision on a complex financial question. But the Greek referendum does not affect the decision of Greece’s creditors. If the vote empowers Tsipras domestically, it does not at the European level. Now, Tsipras has to navigate in these tumultuous waters of a domestic electorate, opposed to additional austerity, while providing a proposal acceptable to his creditors, most of them highly in favor of additional austerity measures. Tsipras seems to be facing a conundrum, either remaining in the Eurozone and what it entails, or leaving the Eurozone, and dealing with the consequences of a default.

In the mid-term, there are many technicalities that need to be figured out if Greece decided to leave the common currency. The legal baseline is the 1992 Maastricht Treaty,

Photograph by Federico Gambarini — picture-alliance/dpa/AP
Photograph by Federico Gambarini — picture-alliance/dpa/AP

which does not provide any information in order to leave the common currency. In the contemporary European history (aside from the collapse of Habsburg empire), there are no precedents, no rules and no plans in order to leave a common currency. But with a return of the Drachma, the real question for the Greek government will be about the exchange rate between the Drachma and the Euro as all Greek accounts are in Euros. At the end of the day, the Greek savings will be severely devaluated causing massive financial losses.

The Greek drama illustrates the complexity of the unfinished European construction. Since the Treaty of Maastricht of 1992 laying out the current foundations of the European Union, the Member States have avoided any decisions for furthering/deepening the integration process or completely loosening it. Today, if Greece is in such trouble, is certainly because of its domestic problems (high level of corruption and lack of structural reforms), but as well because of an integration à la carte of the Eurozone. At the end of the day, a Grexit or not is only a technicality. The real question is: will the Eurozone members be working once and for all on finalizing a fully integrated and functional Eurozone?

(Copyright 2015 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).

A European Army – Re-Visiting an Old Federalist Dream?

EU-Battlegroups_2628575b

The call for a European Army is back on the European table. In an interview with German newspaper Die Welt over the weekend, Jean-Claude Juncker, President of the European Commission, discussed on a wide array of topics from the Eurocrisis, to Grexit, to the Monetary Union, and called for the creation of a European army. The discussions around the topic of a European army have been cyclical inside European political circles for decades. With the European Council Summit on Defense of June approaching, President Juncker may want to prepare the ground before hand for a productive meeting.

Juncker’s Proposal for a European Army

The lingering crisis in Ukraine is reminding the Europeans how dependent they are on NATO and the US for the enforcement of regional security and how irrelevant/inefficient are the EU and its Member States in shaping desired outcomes in high politics. Despite the attempts by Berlin and Paris to solve the Ukrainian crisis diplomatically, Moscow has not budged and is continuing its territorial expansion in Eastern Ukraine. In some ways, Ukraine is another Kosovo for the Europeans, as in both cases the EU cannot respond independently with force and end the crisis. Such statement is certainly confirmed by Juncker’s comments when arguing that “With its own Army, Europe could react credibly to a threat

Photo: European People's Party/Flickr
Photo: European People’s Party/Flickr

to peace in a Member State or in a neighboring country of the European Union.”

Die Welt continued its interview by asking Mr. Juncker if he thinks that Russia would have thought twice before annexing Crimea if the EU had had a European army. Juncker responded by arguing that military response should not be the initial strategy and only complement diplomacy and politics. However, Juncker went on claiming that “a joint army of Europeans would give the clear impression [to Russia] that we are serious about defending the European values.” Juncker denied the fact that a European army would compete with NATO. As per Juncker, the European army would permit to demonstrate the seriousness of the EU in foreign policy; and contribute to the deepening process of the Common Security and Defense Policy (CSDP).

On Monday, March 9th, the Commission tried to narrow and justify some of the comments made by President Juncker. Chief Commission Spokesman, Margaritas Schinas, underlined that the pooling and sharing (P&S) in defense capabilities make financial sense for the EU-28 (watch his response here). Mr. Schinas called for going beyond the interview and work on the substance of the question of a European army.

Such comment is not surprising coming from Mr. Juncker, as even before becoming President of the Commission, Mr. Juncker was in favor of the creation of a European army. As a Prime-Minister of Luxembourg, a small EU Member State in terms of military power, Mr. Juncker has long been in favor of a common EU force. During his candidacy to the presidency of the Commission, Mr. Juncker reiterated the call for a European army.

The Cyclical Desire for a European Army

The question of European defense is directly intertwined with the story of European integration. As developed in his latest analysis on the Juncker’s proposal, Jan Techau of the Carnegie Endowment wrote that:

The oldest item on the European list of utopian integration topics is a federal superstate. The second oldest is the creation of an EU army. Despite the obvious hopelessness of getting such a thing started and of making it work, this latter idea has been remarkably resilient.

The fight between the Gaullist vision – independent EU army – and the Altanticist – Europe9781472409959.PPC_PPC Template under the US nuclear umbrella – has remained ever since. But one should distinguish six important periods in explaining the tentatives of development/integration in high politics at the EU level (for an in-depth look at the question of the European Defense, refer to the following book Debating European Security and Defense Policy. Understanding the Complexity):

  • 1954 – European Defense Cooperation (EDC) was initiated by the French and killed by the French. The EDC was supposed to create a standing European army.
  • Cold War – Europe under the NATO umbrella. For over 30 years the baseline of European security and defense was enforced by the transatlantic alliance, the North Atlantic Treaty Organization (NATO). The US provided the bulk of the military protection with its military bases around Europe. NATO offered a security blanket to the European Communities, allowing its Member States to focus on economic integration.
  • 1992 – The Treaty of Maastricht and the CFSP. With the fall of the Berlin Wall in November 1989, the collapse of the Soviet Union and the reunification of Germany, powerful EC Member States, France and the UK, felt that deepening the integration process with a new treaty would permit to absorb a reunified Germany. The 1992 Treaty of Maastricht created the European Union and its pillar system. The new institutional design based on a three-pillar structure established the Common Foreign and Security Policy (CFSP) permitting the creation of a common EU foreign policy.
  • 1998 – The Declaration of Saint Malo. Over a two-day bilateral meeting in the French town of Saint Malo, French President Chirac and British Prime Minister Blair agreed on bilateral basis to create a common European defense system permitting the EU to respond to regional crisis threatening the security of the Union and the continent. The Saint Malo Declaration was a response to European inabilities in acting and responding to the war in the Balkans and the 1998 war in Kosovo. Both regional crises highlighted the lack of hard power and unity from the Europeans and their dependence on NATO.
  • 1999-2007 – From summits to deployments. From 1999 to 2007, under the leadership of the first High Representative Javier Solana, the EU institutionalized the European Security and Defense Policy (ESDP) permitting the Union to deploy national forces under the EU flag for civilian and military missions. Many ESDP missions were deployed in Africa, Europe, and Asia (see the map below).
Source: EU ISS. 2014. "#CSDPbasics leaflet." September 26: 5.
Source: EU ISS. 2014. “#CSDPbasics leaflet.” September 26: 5.
  • 2007 to today – Financial crisis and CSDP. Since the 2007 collapse of the financial markets, the global balance of power has been shifting. The US and European economies were on the brink of collapse, and in the specialized literature, the declinist argument, looking at the end of the liberal world order, has illustrated the decline of American hegemony and the rise of new powers. In parallel, a series of crises surrounding Europe initiated by the Arab Spring have caused grave concerns in European capitals and Washington. Europe has been circled by a ‘ring of fire’ from all sides, Ukraine, Syria, Libya, MENA and Central Africa. Inside this ‘ring of fire’ many threats have directly challenged Europeans such as terrorism, mass-migration, war, trafficking, and failed-states. In this environment, the EU has tried to increase its defense harmonization through the Pooling & Sharing (P&S) in order to avoid duplication at the European level as well as responding to the declining of share of national GDP committed to military expenditures. Because of lack of national commitment, the P&S and CSDP have not received the attention required. In such environment, the argument of a European Defense Union (EDU), as raised by Solana and Blockmans, should permit greater strategic, institutional, capabilities, and resources cooperation between the EU-28.

A Hopeless Call?

The call for an EU army is only part of the revival of an old federalist dream. The gap between Juncker’s proposal and the European realities is extremely wide. For instance, the United Kingdom under Prime Minister Cameron has fought all European initiatives towards the furthering of European integration. During the selection and appointment process of Mr. Juncker, the UK opposed his nomination fearing that he would continuously call for deeper integration as he had done in the past. With Juncker at the helm of the Commission for a little less than a year, he has certainly launched a series of initiatives inCAMERON-UK-EU order to re-boost the EU. From the Juncker Plan to launch the European economies (read two previous analyses here and here), to the EU Energy Union to now the call for a EU army, Juncker’ strategy is to demonstrate that ‘more Europe’ is necessary in order to solving Europe’s problems.

Even though the United Kingdom was a pioneer with France in December 1998 when agreeing to the creation of the ESDP, the UK has since changed its position on greater defense integration. Ensuing the Juncker interview, London’s reaction was “Our position is crystal clear that defense is a national, not an EU responsibility and that there is no prospect of that position changing and no prospect of a European army.” The reactions by British politicians have been along the same line, a clear opposition to the Juncker’s proposal of a European army. That does not mean that the UK is opposed to a more integrated CSDP, but the country is in election-mode and being pro-European seems to be a no-go in this election.

If the UK finds Juncker’s call outraging, Germany welcomed it. For instance, German Defence Minister Ursula von der Leyen told German radio that “Our [German] future as Europeans will at some point be with a European army.” France has not been very vocal on Juncker’s comments. So far, France has been very active in his perceived sphere of influence and has been deploying his national troops in Libya, Mali, CAR and throughout the Sahel region at the expense of the CSDP.

The question of a EU army is always of actuality and will remain in the federalist arsenal. President Juncker is correct in his analysis of the state of the world in 2015 and the challenges/threats facing the Union and its 28 Member States. In this ever-changing world and increasing degree of

Photo: Vadim Braydov/Associated Press
Photo: Vadim Braydov/Associated Press

complexity of the challenges, the EU-28 ought to understand that increasing the Pooling & Sharing falls under an improvement of their national security and interest. The regional instabilities equally threaten all EU Member States from Sofia to London, Rome to Copenhagen, Warsaw to Paris. An EU army may not be the appropriate option, but a common strategic thinking and common foreign policy and military vision ought to be addressed and adopted.

(Copyright 2015 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).

The Berlin Wall – The Centerpiece of European Integration?

Photograph: Rex Features
Photograph: Rex Features

The fall of the Berlin Wall on November 9th, 1989 is one of the most important geopolitical events of the late 20th century. It marks the onset of the fall of the Soviet Union, symbolizes the end of the Cold War, and launches a new round in the construction of the European Union. Germany, and especially Berlin, were celebrating on Sunday the 25th anniversary of the fall of the Berlin Wall.

On the one hand, the fall is a direct celebration of the freedom and liberty of the people from state-oppression. On the other, the fall of the Wall created a series of fears and concerns in Western Europe and the US wondering about: What would a reunified Germany look like? Can a reunified Germany be left unchecked? How can the West maintain strong ties with Germany? The answer was: incorporation of the reunified Germany into the Western institutional networks, meaning the North Atlantic Treaty Organization (NATO) and the European Union (EU). In the case of NATO, a reunified Germany did neither affect its institutional design nor its principles, but it permitted Western powers to ‘control’ Germany on questions of defense and security. However, in the case of the EU, the reunification was an axiomatic moment leading to an unprecedented effort towards greater and deeper integration.

Even though the reunification of Germany triggered a new round in the integration process of the Union, at first Western EU Member States were extremely concerned of this geopolitical shift. Soon after the reunification of Germany, a year later, France and Britain understood the need to incorporate the unified Germany inside the European Communities (EC). But the period from November 9th, 1989 to the signature of the

Source: Madame Le Figaro
Source: Madame Le Figaro

Two-Plus Four Treaty (between the US, the Soviet Union, UK and France) on September 12, 1990, granting full sovereignty to Germany,  was very tense. At first, London and Paris were opposed to the reunification as they feared that it would upset the balance of power on the European chessboard. For instance, during a meeting on December 8th, 1989, Margaret Thatcher expressed her fears to her French counterpart, François Mitterrand, about the resurgence of a ‘Grand Reich.’ Additionally, France did not want to see its deep ties with West Germany being upset by a new Germany; while, the UK aspired to maintain its special relationship with the US.

Ultimately, the integration process of the EC was closely linked to the desire to ‘anchor’ the reunified Germany inside a European network of institutions, rules, principles and procedures. In parallel, Paris and London were disagreeing on the degree of European integration required. The 1986 Single European Act (SEA) laying out the foundation of the future European Monetary Union (EMU) and a 1990 intergovernmental meeting pushed the trend towards deeper political, economic and even security integration. The SEA established the common market, the heart and soul of the EU. London was not ready to accept deeper integration as it saw it as a threat to its national sovereignty (seems familiar?). Nevertheless, the 1992 Treaty of Maastricht, incorporating all these dimensions, was a solution to the ‘German dilemma.’ Following the fall of the Wall, “the Treaty of Maastricht became a priority in order to solidify the Union and integrate a reunified Germany inside Europe” (refer to Chapter 5 of Debating European Security and Defense Policy).

The construction of the European experiment took a sharp turn moving from the European Communities (EC) to the European Union (EU). In a matter of three years, the Maastricht Treaty strengthened and deepened the integration process of the European construction. Maastricht laid out the EU under a three-pillars system (see illustration below):

  • the first pillar, the European Communities, dealt with the Common Market and the four freedoms linked to it (under supranational decision-making process)
  • the second pillar, the Common Foreign and Security Policy (CFSP), offered the Union and its Member States an institutionalized external policy (under intergovernmental decision-making process)
  • the third pillar, the Justice and Home Affairs (JHA), dealt with the policies of the sector of justice and police (under intergovernmental decision-making process)
Source: Institute for Language and Speech Processing (ILSP)
Source: Institute for Language and Speech Processing (ILSP)

Undeniably, the European Communities was a passive geopolitical entity, principally focusing on trade and economics, throughout the Cold War. Such risk-aversion was possible for several reasons: NATO offering a security umbrella over the continent; and active Member States like France and the United Kingdom provided security and did not want to see the EC overshadowing their national sovereignty. As well, the European Communities was not design to be an active security and defense actor. With the end of the Cold War and the reunification of the Germany, the EU understood the importance to increase its role in geopolitics and foreign affairs. Despite the creation of the CFSP, it took almost a decade for the creation of the European Security and Defense Policy (ESDP). The 1990s demonstrated, once again, the European inabilities to secure its neighborhood. Additionally, the integration of a reunified Germany as a full NATO member soon after the fall of the Wall was an important moment in order to lower some of the transatlantic concerns about the future of Germany as a regional actor.

Lastly, the fall of the Berlin Wall symbolizes the end of an era for Western power, the victory of liberal democracy over communism (remember Fukuyama’s “End of History”) and underlines the power of individual freedoms in Germany and Europe. The fall of the Wall illustrates the end of the Cold War, which has appeared to be dearly missed in the BRITAIN-G8-SUMMITWest, especially in America. The Cold War was a period of relative stability, offered by the bipolarity of the world order (as theorized and advanced by neorealism), between two blocs, two models. 25 years later, American leadership, especially its most conservative/hawkish branch, is looking back at the Cold War with a certain degree of nostalgia. Today’s world does not hold such clear cut enemy and strategic approach to containing and/or confronting the enemy. All these narratives and actions are all intertwined inside this axiomatic moment of the Fall of the Berlin Wall.

(Copyright 2014 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).

The End of European Illusions or The Return of Geopolitics

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Five years ago, the European project, known as the European Union (EU), was perceived and seen as a boring endeavor between a group of rich and developed nations. The EU was described as the future of the nation-state, some type of postmodern-entity striving within a complex anarchical system. Robert Kagan even portrayed the EU as a 21st century entity facing a 19th century power, Russia. Instead of asking complex questions about EU strategies in dealing with complex geopolitical dynamics, most international relations scholars and experts were looking at technical issues about power relations between small sub-agents within European institutions to explain decision-making and norms-formations. For over a decade, big questions were set aside for technicalities such as: Is the EU able to defend its interests on the European continent? Has the EU developed clear redlines on how to handle threat on the European continent and its neighborhoods? How would EU Member States behave and act under direct threat?

To some degree, these high politics questions were avoided the same way problematic questions about the limited degree of fiscal integration could jeopardize the whole European experiment in case of a crisis affecting the Euro. For over 20 years, EU Member States have lived with the illusion of a region free of geopolitics, a region free of forces possibly leading to another continental war. Ukraine is demonstrating that such geopolitical-less region was an illusion that Member States were happy to buy into. Ukraine in some ways marks the end of the European illusion, which was not the case in 2008 with Georgia.

European illusion of perpetual peace, growth and stability ended abruptly with the global financial crisis. The global crisis spiraled into a Eurozone crisis affected most Eurozone

Credit: © picture-alliance/dpa
Credit: © picture-alliance/dpa

and non-Eurozone members. Despite the crisis, the Euro has remained a strong currency after the Dollar, but has been perceived domestically as the cause of all European traumas. The Eurozone crisis has exposed a two-speed Europe. The Northern Members, led by Germany, have until recently survived the crisis – even though German economy is showing signs of weaknesses -, while Southern Members have simply sought to survive and save the last elements of the post-World War two welfare state. These financial and economic turmoils have shifted into unsustainable political and societal situations in most weakened EU Member States such as France, Italy, Spain among others. The rise of the extremes has been a reality that Europeans have to live and deal with. The crisis has directly threatened the core of European welfare state.

Regionally, the European continent is far from being this safe-heaven free from territorial conquest and traditional war. Russia under Putin has sought to reaffirm its sphere of influence over ‘lost’ territories and strengthen its regional and global relevance. Putin’s Russia can only exist through foreign attention/recognition, especially from NATO countries. Putin’s interpretation of history, at least Russian history, is key in order to

Credit: AP Photo/RIA-Novosti, Mikhail Klimentyev, Presidential Press Service
Credit: AP Photo/RIA-Novosti, Mikhail Klimentyev, Presidential Press Service

understand his actions since in power in 2000. Putin looks back at the lost decade of the 90s as a dark moment in Russian history initiated by Western powers. The then NATO and EU enlargements of Eastern and Central European states were perceived as an attack on Russian national interests. Putin has developed a foreign policy embedded into realpolitik. The use of energy as a weapon against Ukraine almost every winter has been a calculated move by Putin to send a clear signal to Western Europe. But the turning point was the 2008 war against Georgia. At this point, Russia clearly underscored the gap in Western narratives – read NATO and the EU – between commitments to protection of non-NATO members and actions to protect/defend them from Russia. The Ukrainian crisis is the latest illustration of Western risk aversion and unease in confronting Russia. Additionally, Euro-Atlantic members are well aware that the Ukrainian crisis started over a trade agreement between Ukraine and the EU. Almost a year later, Ukraine has lost a part of its territory to Russia, Crimea, and is seeing a civil war in its Eastern territories. If a bilateral trade agreement triggered such tensions in Europe, one can only imagine Putin’s reactions and actions following talks on either EU or NATO enlargement with Ukraine.

The latest chapter in NATO summits in Wales incorporated two dimensions: first, coalition building against the Islamic State in Iraq and Syria (ISIS); second, the strategy in addressing Russia. Concerning the first aspect, coalition building against ISIS, President Obama has succeeded in getting his message heard and approved. Following the NATO summit, six EU Member States, Denmark, France, Germany, Italy, Poland, and the United Kingdom, plus Australia, Canada, Turkey, have agreed on joining a US-led coalition against ISIS. However, when it comes to Ukraine, NATO failed to come with a plan, let alone a strategy. If Obama feels confident on degrading and destroying ISIS, the only thing that the West can do against Russia is containing it. The rounds of sanctions against Russia have deepened the tensions between both sides, but have yet to seriously affect Russian economy and influence Putin’s actions.

The decades of European growth from the Treaty of Maastricht (1992) to the Treaty of Lisbon (2009) have seen remarkable deepening and widening processes. In terms of deepening, EU Member States were committed to increasing the integration process of the Union; while the widening process, materialized into four waves of enlargement, led to the inclusion of 16 new Member States. Aside from the regional tensions in the Balkans, the EU was believed to offer its Member States a zone-free of geopolitics, a fortress limiting the dark forces of globalization – immigration, state violence, territorial conquest -. Not only it has never been true considering the violence and wars in the Balkans, but it has certainly been an illusion bought by Member States and incorporated in academic research. The series of crisis starting with the 2007 financial crisis, the Arab Spring, continuous and deepening of violence in the Middle East, and the Ukrainian crisis underscore not only the uneasiness of EU Member States to address them, but also the inabilities of the EU to shape its world. The integration process was so successful that the EU Member States have lost their ways in dealing with geopolitics.

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