European Politics

A bloggingheads with Dan Drezner, where we discuss in passing the recent dust-up between Tyler Cowen and Paul Krugman on Keynesian demand-stimulation strategies and Germany (see here, here here, here. I’m mostly on Krugman’s side of this argument, but not entirely – a few points.

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Ken Coates, a very significant figure in the history of the British left, has died. The Guardian has an obituary.

Jesus Christ. Louis Michel, the former European Commissioner for Development and Humanitarian Aid, is reported by the EU Observer as offering his opinions about Leopold II, King of the Belgians and one-time private owner of the Congo:

“Leopold II was a true visionary for his time, a hero,” he told P-Magazine, a local publication, in an interview on Tuesday. “And even if there were horrible events in the Congo, should we now condemn them?” … “Leopold II does not deserve these accusations,” continued Mr Michel, himself a descendent of the Belgian king and a “Knight, Officer and Commander” in the Order of Leopold, Belgium’s highest honour. … “The Belgians built railways, schools and hospitals and boosted economic growth. Leopold turned the Congo into a vast labour camp? Really? In those days it was just the way things were done.” …. Admitting there were “irregularities,” he said: “We can easily be tempted to exaggerate when it comes to the Congo … I feel instinctively that he was a hero, a hero with ambitions for a small country like Belgium.” “To use the word ‘genocide’ in relation to the Congo is absolutely unacceptable and inappropriate.”

Let’s be clear about this: what Michel has said is comparable to Holocaust-denial. If you doubt this, or even if you haven’t read it yet, then Adam Hochschild’s King Leopold’s Ghost should set you right. Perhaps 10 million people, perhaps half the population of the area, died during the “Free State” period, victims of Leopold’s greed for the region’s natural resources, chiefly rubber.

Charlemagne writes about European Commission officials.

I would not be astonished if a majority of the [British] public assume that EU officials are primarily motivated by pay, perks and privileges. Actually, from Mr Farage’s point of view, I suspect the truth is still more worrying. EU officials, in my experience, want “more Europe” because they want “more Europe”. … EU officials live in a world in which nationalism is the great evil. … They are often highly educated, in a geeky sort of way … The town’s defining ethos of anti-nationalism is often admirable. EU officials are easy to get on with, and a decent bunch in my experience. But it brings problems: I find a lot of people in this town at best naive about how much integration public opinion will accept, and at worst a bit hostile to democracy. Get a Brussels dinner party onto referendums, and hear people rave about the madness of asking ordinary people their opinions of the European project.

I found this pretty interesting because I was thinking about writing a piece last week about how Charlemagne himself represents a political tendency that is “a bit hostile to democracy.” The occasion of this critique was his linking to a piece that he wrote under his own name before he worked for the Economist which is all about how one needs to have restraints on national level democracies for the European project to work.
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Fascinating interview with Jurgen Habermas in today’s Irish Times. Talking about Merkel and how she has burnt Germany’s reputation for putting its longer term interests as the greatest beneficiary of an effective European Union ahead of short-term, domestic politics, he notes a generational difference:

“Over the past four weeks Angela Merkel has squandered much of the capital of trust accumulated by her predecessors over four decades. … After Helmut Kohl, our political elites underwent a sweeping change in mentalities. With the exception of a too-quickly exhausted Joschka Fisher, since Gerhard Schröder took office a normatively unambitious generation has been in power. It seems to enjoy Germany’s return of Germany to normality as a nation-state – and just wants be “like the others”. Conscious of the diminishing room for political manoeuvre, these people shy away from farsighted goals and constructive political projects, let alone an undertaking like European unification. I detect a certain indifference towards this project. On the other hand, the politicians can no longer deceive themselves concerning the fact that the Federal Republic is the greatest beneficiary of the single currency. Self-interest dictates that they support the preservation of the euro zone.

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Eugene Volokh, in a brief post on the Dutch election, characterizes Geert Wilders as a ‘leading critic of Islam.’ This is a fascinating terminological choice. If a European politician who had angry views about Israel went ahead to advocate a ban on the Torah, a five year ban on the building of Jewish temples, a permanent ban on preaching in Hebrew, and a government program aimed at paying Jews to leave the country, would Eugene Volokh describe him as a “leading critic of Judaism?” I suspect, perhaps incorrectly, that he might use slightly different language.

Update: The title of Volokh’s post has now been changed (I imagine in response to this post) to characterize Wilders as a “Leading Critic of Islam (and Advocate of Restrictions on the Practice of Islam).” Whether this constitutes a substantial improvement or not I leave open to debate.

There are two national elections in the Low Countries this week—today in the Netherlands and Sunday in Belgium. The Belgian elections are actually hugely important for the future (or absense of such a future) of the country, since there hasn’t been any real functioning government in the last three years, and the Flemish voters are probably going to vote en masse for NVA, the flemish democratic nationalist party. More on this on Sunday.
In the meantime the Dutch voters had their chance to vote for a new government today, and the first prognosis, based on exit poll results, is that the VVD (mainstream ‘liberal’ (in the European sense) right wing party) and the PVDA (the social-democrats/labour party) would both be leading, but only with 31 out of 150 seats. The Christian-democratic party, who were the biggest in the last couple of elections, would fall back to 21 seats. PVV, the right wing anti-immigrant party of Geert Wilders would have 22 seats, and other parties 16 (populist socialist party), 11 (Greens), 10 (Left-Liberals), and 7 seats for the orthodox Christian parties. So this is extremely scattered. All this needs to be taken with a serious pinch of salt of course – it’s merely exit polls, but nevertheless still interesting, since it shows how difficult it will be to form a coalition. It’s not unlikely that a four-party coalition will be needed.
For more background information, read this post by Erik Voeten. The comments section is open for anything related to the Dutch elections, including predictions on what kind of coalition would be plausible, and actual results as they become available. I’ll add my bit as long as I am awake.

getting interesting …

Wolfgang Schäuble in the Financial Times

Indeed, far from reflecting a growing German Euroscepticism, Mr Schäuble and Ms Merkel have both revived calls for closer political union to underpin economic and monetary union. “When we introduced the euro in the 1990s, Germany wanted a political union and France did not. That is why we have an economic union without a political union,” he says. “Political union naturally means a bit of federalism in the German sense of federal. It means that one can no longer take certain decisions on a national level. That is very hard for the UK. It’s often not so simple for France, but France finds it easier to take European decisions.

“Germany has a lot of experience with federalism, more than the UK or France. If you want to create a federal organisation, you must be ready to have a certain amount of redistribution within it. You can dismiss that by rudely calling it a “transfer union”. But strong and weaker states both have their responsibility. We are asking a lot of the weaker ones, but the strong also have their responsibility, and we must explain that as well.

“We must say very clearly to Germany: we can play our role, but we must know that means there will be decisions taken against us. The weekend before last [in the negotiations over the eurozone stabilisation mechanism], we saw that it was not in the German interest to be standing alone. That is also a good learning process for the German public.”

Have just finished writing two papers with hard deadlines – now in the throes of grading – so two quick points, which either sort-of-resonate-with or half-contradict each other in ways that I don’t have time to think or write about.

First: ungovernability. Or, rather, “ungovernability.” Chris got a lot of flak in comments for suggesting that centrists and center-right people in the media were going to come out with suggestions that a bit of dictatorship might not be a bad idea. As he pointed out, there used to be a lot of people on the right and center-right who made these arguments – and not just about countries in the developing world. Crouch and Pizzorno’s The Resurgence of Class Conflict in Western Europe is particularly good on this, as I recall. That said, unlike Chris, I don’t have strong expectations that this set of rhetorical tropes is going to emerge in the very near future (although it may in the medium term). The old crop of center-right dictator-fanciers were fans of dictatorships not because they were opposed to democracy tout court, but because they were opposed to certain parts of the economy being subject to political control. This is not so much of an issue these days. From a certain point of view, the European Central Bank is a more-than-acceptable functional substitute for General Augusto Pinochet. Indeed, being less publicly embarrassing, it is arguably superior. One of these days soon, by the way, I’m going to write my post on the editorial policy of the Economist during the Irish Famine – it wasn’t one of its finer moments.
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I’m rushing to prepare to go into a lockup to write reports on Australia’s government budget, brought down tomorrow, so this post is a bit scatty, but it might raise some points for discussion regarding the European debt crisis.

• First, a general observation. In a typical bailout, the biggest beneficiaries are not debtors, but creditors. So creditors ought to be “bailed-in” and made to bear some part of the cost

• The Greek case is misleading, in implying that government profligacy is the primary cause of the crisis. In most cases, the problem is the same as in earlier rounds of the crisis, most obviously in Iceland – bad loans by private banks which their national governments feel impelled to rescue, but can’t afford to

• The idea that the euro precludes devaluation as a way out is a relatively minor part of the story. Given that debts are denominated in euros, devaluation to improve the trade balance would be only marginally effective. The real effect of the eurozone so far, has been to raise the stakes regarding default.

• Resolving the crisis requires a couple of measures at the European level – monetary expansion by the ECB – co-ordinated action to strengthen government revenue, both by an acceleration of the attack on tax evasion and by discouragement of tax competition within the eurozone

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Just about every article in this morning’s Financial Times seems to include a paragraph or two about how governments need to “deliver” debt reduction, to satisfy the markets, investor expectations etc. They then typically note that said investors are anxious about whether democratic politicians can “deliver” the austerity measures that the markets “require”. So here’s the question: how long before the Economist, the Murdoch press and similar give up on democracy on the grounds of its incapacity to “deliver” firm government? We’ve been here before, of course, in the 1970s, when the Economist and the Times backed the Pinochet coup in Chile. Of the PIIGS, only Ireland has escaped dictatorship in living memory and some of the southern European countries still contain contain authoritarian rumps (with special strength in the armed forces and law enforcement). My guess is that we’ll be reading op-eds pretty soon that raise the spectre of “ungovernability” and espouse “temporary” authoritarian solutions. Maybe such columns are already being written? Feel free to provide examples in comments.

I’ve been remiss in posting about the Greek crisis, thanks to other obligations (one paper, semi-half-arsed, just written for a workshop tomorrow; another paper, at best one quarter arsed, for a deadline next week), but here are a few points for discussion.

(1) On the argument argument that got me drawn into this in the first place, I think that Charlemagne’s criticism of Krugman was demonstrably wrong. As I summarized matters back then:
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Charlemagne’s prediction ¹ that the Greek crisis would have no substantial effects for EU integration is looking decidedly wobbly.

Radical plans for a European version of the International Monetary Fund to bail out crisis-hit countries would need a new treaty and the agreement of all European Union member states, Angela Merkel, Germany’s chancellor, has warned. Throwing her weight behind the proposals from Wolfgang Schäuble, her finance minister, Ms Merkel admitted that the European Union had lacked the tools to deal with the Greek debt crisis: “The sanctions we have were not good enough.” But she added that a full-scale negotiation of the EU’s 27 member states would be needed to set up a European Monetary Fund, which would be able to bail out eurozone members subject to strict budgetary conditions. “Without treaty change we cannot found such a fund,” Ms Merkel told foreign correspondents in Berlin yesterday.

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The Washington Post runs an editorial on the topic of the financial data privacy controversy that I blogged about a couple of weeks ago. Predictably, it’s an ill-informed harrumph.

THE PROGRAM has been credited with helping to capture the mastermind of the 2002 Bali nightclub bombings that killed more than 200 people, including some 50 Europeans. … Yet almost 400 members of the European Parliament want nothing to do with it and have effectively and indefensibly shut it down. … The tool in question is the Terrorist Finance Tracking Program, which the United States created shortly after the 2001 terrorist attacks in hopes of using financial transactions to trace the whereabouts of suspects. … The European Commission hashed out an interim deal to allow the United States to continue operations, but the European Parliament objected, largely on the basis of bogus privacy concerns. … The Obama administration should work with E.U. leaders to push for reconsideration. If need be, additional oversight should be considered. But the administration must not go too far. Gutting a legal and effective program for the sake of imagined privacy gains would be as unwise and potentially dangerous as having no program at all.

I know that when the WP editorial team sees the words ‘tracking terrorism,’ it responds with precisely that degree of judicious consideration which you apply when the doctor whacks your funny bone with a pointy rubber hammer. But the noxious guff about “bogus privacy concerns” and “imagined privacy gains” is just that – noxious guff. The program that the Washington Post is so fond of was implemented in blatant violation of EU law for years before the NYT had the guts to reveal its existence (despite strong pressure from the Bush administration not to do so). Nor are the European Parliament’s privacy concerns ‘bogus.’ The current administration has consistently refused to provide any guarantees whatsoever about how this data might, or might not, be shared with third countries. Given that many of our soi-disant allies in the war on terror have a distinctly robust attitude to the treatment and detention of possible terrorists, Europeans may very reasonably worry that any data they provide will be used to imprison and torture people, some innocent. I’ve talked about these issues with MEPs a lot over the last several years. Their memories of extraordinary rendition and the use of shared information (between the US and Canada in this instance) in the Maher Arar case left a very bad taste in their mouth. Nor is the US willing to talk about real redress or compensation for people unjustly targeted via this data.

In any event, like it or not, the editorial writers of the Washington Post are going to have to learn to live with a transatlantic relationship where an actor which cares about privacy can veto security arrangements. Abe Newman and I recently wrote a piece on Foreign Policy’s website that talks to this.

To build support for counterterrorism cooperation, the United States must explicitly accept that the European Parliament will play a key role in future negotiations. … The U.S. administration must treat the Parliament as a true negotiating partner, along with the EU member states, on information sharing and domestic security. The U.S. administration can also address the Parliament’s substantive worries by creating its own privacy oversight structures and extending its protection to European citizens…. If the United States wants to rebuild the transatlantic relationship and promote its own security interests, it must stop treating the European Parliament as an irrelevant afterthought.