a citizen’s journal by Thomas Nephew

Congratulations to the EU on the Nobel Peace Prize! You guys *rock*!

Posted by Thomas Nephew on October 16th, 2012

Now please consider earning it.

I don’t have much of a problem with the European Union getting a Nobel Peace Prize — I just have a problem with it getting one right now.*   Europe’s elites are using a a cause that once seemed noble — to make Europe too busy, too integrated, and too prosperous to conceive of another war — as a blunt instrument to exacerbate hardship, create conflict, exploit natural resources, and unravel the social contract:

  • Greek health system crumbles under weight of crisis (Tagaris, Reuters, 6/14/12): “Greece’s rundown state hospitals are cutting off vital drugs, limiting non-urgent operations and rationing even basic medical materials for exhausted doctors as a combination of economic crisis and political stalemate strangle health funding.”
  • Hunger on the rise in Spain (Daley, NYTimes, 9/24/12):  “[Dumpster diving] tactics are becoming increasingly commonplace here, with an unemployment rate over 50 percent among young people and more and more households having adults without jobs. So pervasive is the problem of scavenging that one Spanish city has resorted to installing locks on supermarket trash bins as a public health precaution. “
  • Greek anti-fascist protesters ‘tortured by police’ after Golden Dawn clash (Margaronis, Guardian, 10/9/12): ““This is not just a case of police brutality of the kind you hear about now and then in every European country. This is happening daily. We have the pictures, we have the evidence of what happens to people getting arrested protesting against the rise of the neo-Nazi party in Greece. This is the new face of the police, with the collaboration of the justice system.””
  • Greece to become Europe’s biggest gold producer (Zacharikis, Die Zeit, 10/11/12): “The Greek government has been working on administrative reforms since the beginning of the debt crisis. The “Fast Track” accelerated licensing process developed last year is apparently attracting international gold mining companies. […] But there’s popular opposition to the mining projects. People fear serious environmental damage, for instance from clearing about 26,000 hectares of forestland. […] there were violent encounters with police during September protests against the gold mines in the northern Greece region of Chalkdiki.”  (transl. by the author)
  • Eurozone demands six-day week for Greece (Traynor, Guardian, 9/4/12): “In the letter, the officials policing Greece’s compliance with the austerity package imposed in return for the bailout insist on radical labour market reforms, from minimum wages to overtime limits to flexible working hours, that are likely to worsen the standoff between the government and organised labour in Greece.”

Stack these things up next to each other, and it seems reasonably clear that the European Union, led by German right-wing chancellor Angela Merkel, is basically executing a bald “Shock Doctrine”-style economic takeover of the region’s southern tier, with the help of conservative and sometimes fairly fascist political groups in the region.

Opposition is loud, angry, sometimes violent, but as yet apparently quite ineffectual in countries like Greece and Spain. But it appears to be timid-to-nonexistent within Germany, where the middle and working classes are coming off a prolonged period of income stagnation and “Hartz IV” semi-austerity of their own.  A recent report (by Josh Rosner for Graham LLC, via “naked capitalism”) suggests that

Unfortunately for the German population, while German business profited handsomely, and German Banks exported capital to the rest of the world, the costs were borne by German workers who faced wage pressure. German households never reaped the fruits of their labor. The imbalances … were being built into the very structure of the Eurozone by the German government’s sole focus on protecting domestic business interests at the expense of their own population.  […]

The German population has been led to believe, over the past decade, that they are frugal and that frugal is good. [Germans] are indeed frugal, but not entirely by choice. This is a perverse spin on the real situation, the German people have been deprived of wage increases and therefore of consumption of goods.

Rosner warns that “the German government will be forced to choose either a large share of the costs of supporting a further integration of the European Monetary Union or, alternately, the larger economic and social costs of its failure, including the massive costs of recapitalizing German banks and financial support for German industry.”

Politically, Germans appear more willing to be convinced that Mediterranean profligacy, rather than German 1% greed/expediency**, is to blame for the looming financial crackup,  and more willing to applaud imposing austerity elsewhere than simply get on with accepting investment losses  — even though that austerity “elsewhere” is bound to drag their export-driven economy down with it.   One place for any better German politics to begin might be in recalling that the German economy (if not necessarily its citizens) has profited in all manner of ways from the credit extended to southern Europe; its own budget is profiting handsomely from the lower interest rates caused by the flight to German safety; and frugal reputation notwithstanding, the country has repeatedly been let off the financial hook in its modern history — to the benefit of all.  It may be time to pay some of that forward.

But that would take leadership that is hard to discern, at least from an ocean away.  Opaque as European politics are to me, I hesitate to make too much of a recent “Open Letter to My Friends, the Financiers of America” by one Alain Minc in the New York Review of Books.  Minc chides the American 1% for Schadenfreude about the Eurocrisis, tracing that malicious glee to a “deeply held belief and a gut feeling that no political construct—and the euro is a political construct, make no mistake—can govern markets.”  While it’s presumably a little bit hard to get published at NYRB, for all I know, Monsieur Minc is a nobody.  Suffice it to say that he’s got the wrong friends — and if he’s representative of the best there is among Europe’s elites, he’s part of the problem:

Every time a public opinion poll highlights the disillusionment of this or that sector of the European populace, especially in Germany, we are treated to articles under your bylines proclaiming that, caught between lack of market confidence and popular disapproval, the euro is doomed.  In so doing, you show a failure to understand that, even though public opinion may differ, the governing establishment has made its choice.

As one who sincerely wishes Europeans and Germans well: isn’t that kind of the problem?  Last time I checked, a European constitution went down to fairly resounding defeat in 2005.  No matter, said the Eurocrats, let’s do an end run and call it the Treaty of Lisbon, ratifying much of the stuff that the rejected constitution contained.  After all that, I’m not enough of a Euro-expert to know what all is and is not understood to be a “European Union”; thing is, I suspect a sizeable percentage of Europeans either don’t know either, or do know and don’t like it.

Under circumstances like those, if I were a European, the Nobel Prize would feel like something Norway peeled out of its wallet and threw at my feet next to my tin cup:  “good luck with that; glad we’re not you.”  This Nobel Prize has comforted the comfortable and, to that extent, it has afflicted the afflicted.  It would be interesting to find out at which Davos or Aspen ski lodge the idea was born.

* I hope the prize has a better effect this time than it did for Barack Obama.  The EU’s prize is at least arguably more justified than a prize for a president who had accomplished precisely nothing for peace at the time, and who spent a good deal of his acceptance speech outlining justifications and standards of conduct for war which his subsequent policies have, if anything, served to undermine.
** Needless to say, not just the German 1%; when financial apocalypse looms, Goldman Sachs can’t be far from the scene.

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