Τρίτη, 10 Φεβρουαρίου 2015

Η άνοδος της Γερμανίας... The European crisis and the Ukrainian crisis are mirror images. Ξεκινάνε καταστάσεις αλλά πάνε "αλλού" για υλοποίηση... the only lesson might be that default works


...Greece and Ukraine are not linked in the American mind. They are linked in the German mind, because both are indicators of Germany's new role in the world and of Germany's discomfort with it...

...The world that Merkel faces today is startlingly different. The European Union is in a deep crisis. Many blame Germany for that crisis, arguing that its aggressive export policies and demands for austerity were self-serving and planted the seeds of the crisis. It is charged with having used the euro to serve its interests and with shaping EU policy to protect its own corporations. The vision of a benign Germany has evaporated in much of Europe, fairly or unfairly. In many places, old images of Germany have re-emerged, if not in the center of many countries then certainly on the growing margins. In a real if limited way, Germany has become the country that other Europeans fear...

...the peace that Germany had craved is in jeopardy. Events in Ukraine have aroused Russian fears of the West, and Russia has annexed Crimea and supported an insurgency in eastern Ukraine. Russia's actions have sparked the United States' fears of the re-emergence of a Russian hegemon, and the United States is discussing arming the Ukrainians and pre-positioning weapons for American troops in the Baltics, Poland, Romania and Bulgaria. The Russians are predicting dire consequences, and some U.S. senators are wanting to arm the Ukrainians...

...Germany's goal has been to avoid taking a leading political or military role in Europe. The current situation has made this impossible. The European financial crisis, now seven years old, has long ceased being primarily an economic problem and is now a political one. The Ukrainian crisis places Germany in the extraordinarily uncomfortable position of playing a leading role in keeping a political problem from turning into a military one...

...In Ukraine, Germany was an early supporter of the demonstrations that gave rise to the current government. I don't think the Germans expected the Russian or U.S. responses, and they do not want to partake in any military reaction to Russia. At the same time, Germany does not want to back away from support for the government in Ukraine...

...In the European crisis, it is Germany that is most rigid not only on the Greek question but also on the general question of Southern Europe and its catastrophic unemployment situation. In Ukraine, Berlin supports Kiev and thus opposes the Russians but does not want to draw any obvious conclusions. The European crisis and the Ukrainian crisis are mirror images. In Europe, Germany is playing a leading but aggressive role. In Ukraine, it is playing a leading but conciliatory role...

[...]

Therefore, Germany adopted a contradictory policy. Although it supported a movement that was ultimately anti-Russian and supported sanctions against the Russians, more than any other power involved it does not want the political situation to evolve into a military one. It will not get involved in any military action in Ukraine, and the last thing Germany needs now is a war to its east. Having been involved in the beginnings of the crisis, and being unable to step away from it, Germany also wants to defuse it.

The Greek Issue

Germany repeated this complex approach with Greece for different reasons. The Germans are trying to find some sort of cover for the role they are playing with the Greeks. Germany exported more than 50 percent of its gross domestic product, and more than half of that went to the European free trade zone that was the heart of the EU project. Germany had developed production that far exceeded its domestic capacity for consumption. It had to have access to markets or face a severe economic crisis of its own.

But barriers are rising in Europe. The attacks in Paris raised demands for the resurrection of border guards and inspections. Alongside threats of militant Islamist attacks, the free flow of labor from country to country threatened to take jobs from natives and give them to outsiders. If borders became barriers to labor, and capital markets were already distorted by the ongoing crisis, then how long would it be before weaker economies used protectionist measures to keep out German goods?

The economic crisis had unleashed nationalism as each country tried to follow policies that would benefit it and in which many citizens — not in power, but powerful nonetheless — saw EU regulations as threats to their well-being. And behind these regulations and the pricing of the euro, they saw Germany's hand.

This was dangerous for Germany in many ways. Germany had struggled to shed its image as an aggressor; here it was re-emerging. Nationalism not only threatened to draw Germany back to its despised past, but it also threatened the free trade essential to Germany's well-being. Germany didn't want anyone to leave the free trade zone. The eurozone was less important, but once they left the currency bloc, the path to protectionism was short. Greece was of little consequence itself, but if it demonstrated that it would be better off defaulting than paying its debt, other countries could follow. And if they demonstrated that leaving the free trade zone was beneficial, then the entire structure might unravel. Germany needed to make an example of Greece, and it tried very hard last week to be unbending, appearing to be a bit like the old Germany. The problem Germany had was that if the new Greek government wanted to survive, it couldn't capitulate. It had been elected to resist Germany. And whatever the unknowns, it was not clear that default, in whole or part, wasn't beneficial. And in the end, Greece could set its own rules. If the Greeks offered a fraction of repayment, would anyone refuse when the alternative was nothing?

Therefore, Germany was facing one of the other realities of its position — one that goes back to its unification in 1871. Although economically powerful, Germany was also extremely insecure. Its power rested on the ability and willingness of other countries to give Germany access to their markets. Without that access, German power could fall apart. With Greece, the Germans wanted to show the rest of Europe the consequences of default, but if Greece defaulted anyway, the only lesson might be that default works. Just as it had been in the past, Germany was simultaneously overbearing and insecure. In dealing with Greece, the Germans could not risk bringing down the European Union and could not be sure which thread, if pulled on, would unravel it.

Merkel's Case in Washington

It was with this on her mind that Merkel came to Washington. Facing an overwhelming crisis within the European Union, Germany could not afford a war in Ukraine. U.S. threats to arm the Ukrainians were exactly what she did not need. It wasn't just that Germany had a minimal army and couldn't participate or, in extremis, defend itself. It was also that in being tough with Greece, Germany could not go much further before being seen as the strongman of Europe, a role it could not bear.

Thus, she came to Washington looking to soften the American position. But the American position came from deep wells as well. Part of it had to do with human rights, which should not be dismissed as one source of decision-making in this and other administrations. But the deeper well was the fact that for a hundred years, since World War I, through World War II and the Cold War, the United States had a single rigid imperative: No European hegemon could be allowed to dominate the Continent, as a united Europe was the only thing that might threaten national security. Therefore, regardless of any debate on the issue, the U.S. concern about a Russian-dominated Ukraine triggered the primordial fear of a Russian try at hegemony.

It was ironic that Germany, which the United States blocked twice as a hegemon, tried to persuade the United States that increased military action in Ukraine would not solve the problem. The Americans knew that, but they also knew that if they backed off now, the Russians would read it as an opportunity to press forward. Germany, which had helped set in motion both this crisis and the European crisis, was now asking the United States to back off. The request was understandable, but simply backing off was not possible. She needed to deliver something from Putin, such as a pledge to withdraw support to Ukrainian secessionists. But Putin needed something, too: a promise for an autonomous province. By now Merkel could live with that, but the Americans would find it undesirable. An autonomous Ukrainian province would inevitably become a base for undermining the rest of the country.

This is the classic German problem told two ways. Both derive from disproportionate strength overlying genuine weakness. The Germans are trying to reshape Europe, but their threats are of decreasing value. The Germans tried to reshape Ukraine but got trapped in the Russian reaction. In both cases, the problem was that they did not have sufficient power, instead requiring the acquiescence of others. And that is difficult to get. This is the old German problem: The Germans are too strong to be ignored and too weak to impose their will. Historically, the Germans tried to increase their strength so they could impose their will. In this case, they have no intention of doing so. It will be interesting to see whether their will can hold when their strength is insufficient.

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