Compromise on the Greek Question

The compromise which European leaders reached last week on aiding Greece may struck many foreign observers as evidence of the EU’s ineffectiveness at settling its internal discord, but it was in fact a minor victory for “President” Herman Van Rompuy and his campaign for greater economic governance from Brussels.

Van Rompuy, former prime minister of Belgium, became the first permanent president of the European Council last year, which is the regular conference of EU government leaders. The election of a relative unknown from one of Europe’s smallest of member states wasn’t particularly hailed as a great step forward for the union. Van Rompuy, critics dreaded, would allow himself and the EU presidency to be overshadowed by more powerful figures, including France’s Nicolas Sarkozy and Germany’s Angela Merkel.

Newsweek‘s Anita Kirpalani was quick to point out that the cautious choice for Van Rompuy was also a wise one, for he had actually a chance at fostering consensus. “What looks like timidity might just lead to a stronger Europe after all,” she predicted last November.

The Belgian’s ability to balance French and German interests was revealed in recent weeks. France, along with Italy, vehemently resisted the notion that withering Greece should seek support with the International Monetary Fund, believing that such a move post an embarressment to Europe’s economic integration. Germany on the other hand had no desire to bail out a member state that had repeatedly violated European budget rules and argued for tougher sanctions instead to punish eurozone members that made a mess of their finances. Chancellor Merkel even suggested that violators should eventually be denied the common currency.

Both parties compromised on Friday, agreeing that a Greek rescue plan should include the IMF. That Sarkozy was forced to give in is something of a personal victory for the Fund’s managing director, Dominique Strauss-Kahn, writes The Wall Street Journal. He might be running for the French presidency in 2012.

The IMF isn’t likely to act immediately. Both Europe and the Fund prefer to wait to see whether the aid announcement on itself will suffice to reduce Greece’s borrowing costs.

Russian Bombers Penetrate British Airspace

Two weeks ago, two British Tornado F3 fighter aircraft were scrambled from the Royal Air Force base Leuchars, the United Kingdom’s most northerly air defense station, to pursue two Russian Tupolev 160 bombers which were approximately one hundred nautical miles to the west of Stornaway on the northwest coast of Scotland.

More than twenty of such incident have occured over the last year, the Ministry of Defense revealed on Wednesday. In scenes that harken back to Cold War era saber rattling, Moscow has been issuing planes to probe British air defenses in what largely appear to be a shows of strength.

In the last incursion, the Tornadoes shadowed the Russian aircraft for four hours as they progressed south before the Blackjacks, as the Tupolevs are known in NATO jargon, turned north, short of the Northern Irish coast, exiting British airspace. Read more “Russian Bombers Penetrate British Airspace”

Greece Continues to Divide Europe

German chancellor Angela Merkel met head on with the European Commission on the Greece question over the weekend. Chairman José Barroso is pushing European governments to commit to a Greek bailout this Thursday when member states convene in Brussels. Merkel is having none of it.

The chancellor declared on German radio on Sunday that no bailout is being considered. The Greeks themselves, after all, haven’t asked for help, she said. Barroso responded in today’s Handelsblatt, urging European states to find a solution, regardless of their internal politics. Read more “Greece Continues to Divide Europe”

Gordon Brown’s Chance at Victory

Just a few months ago, the British Conservatives had this year’s parliamentary election in their pockets. After more than ten years of Labour rule, Britons were tired with Gordon Brown while opposition foreman David Cameron lured as a fresh, “green right” alternative who promised to restore fiscal responsibility and British pride altogether.

The Conservatives polled at their best two years ago, scoring a 20 percent lead over Labour at the time. Since the end of last year however, their popularity has been on the decline.

While still set to win the elections, it appears unlikely that the Conservatives will manage to gain a majority. In the event of such a “hung parliament,” there is a good chance, writes Peter Oborne for the Daily Mail, that the Liberal Democrats, Britain’s third party, will end up keeping Labour in power.

The Liberal Democrats’ Nick Clegg has promised that if neither of his opponents win an overall majority in the House of Commons, he will support whichever collects the highest number of seats.

Most Liberal Democrats aren’t too enthusiastic about letting the Conservatives govern however. They oppose their intention to balance the budget through massive cuts in spending. Gordon Brown on the other hand has quietly suggested that he might be willing to consider electoral reform. Proportional representation is something the Liberal Democrats have long been dreaming of for it would undoubtedly allow them greaten their base of support.

All this talk of an alliance with Labour is something of a personal setback for Clegg. Under his leadership, the party has moved to the right and he would probably prefer to work alongside David Cameron instead Brown even as the rest of his party disagrees.

Political Uncertainty in the Netherlands

Local elections in the Netherlands in March already forecast the tangled political landscape the country now finds itself in facing parliamentary elections in June.

The Labor Party, which pulled out of its coalition with Prime Minister Jan Peter Balkenende’s Christian Democrats because it wouldn’t consider a continued military presence in Afghanistan, did well in the polls but no viable three-party majority has emerged yet. Party leader Wouter Bos announced his resignation on Friday, naming Amsterdam mayor Job Cohen as his successor. Unlike Bos, Cohen is seen as prime ministerial candidate and more of a traditional socialist who can regain the party’s support from low-income voters.

After the election, the participation of the liberal party could be critical. It previously governed with the Christian Democrats in the wake of the murder of right-wing politician Pim Fortuyn in 2002. Their popularity has taken a beating since Geert Wilders left the party in 2004 to run on his own ticket. But it is still difficult to imagine a government without them.

Wilders appeals to a segment of the population with his attacks on Islam and the multicultural society. His Freedom Party blames Labor for the country’s integration problems which would make a coalition between the two problematic.

But Wilders is projected to lead the Netherlands’ second political force. In spite of left-wing attempts to exclude him from power, the Christian Democrats, at least, are willing to work with him.

If Wilders won’t govern, the alternatives include a full left-wing coalition under Labor, a center-right alliance of multiple parties likely dominated by the Christian Democrats and liberals and a centrist goverment of Labor and liberals, possibly joined by the progressive liberal Democrats. Such a three-party “purple” coalition governed the country from 1994 to 2002.

Labor has refused to commit to a “red” accord, wary that a pledge to govern on the left would hurt its chances with moderate voters. It may even prefer a broad coalition with the Christian Democrats and liberals. It has partnered both before, if separately.

One way or another, the liberals will have to be included and they are bound to demand a high price for their kingmaking. The party has been critical of the outgoing government, particularly of its response to the economic downturn. The liberals form the only faction in parliament that has proposed massive and specific budget cuts while they continue to champion free markets. In coalition with the Christian Democrats, they deregulated business and privatized health care. Whether smaller parties in the center, let alone Labor, would go along with such policies is doubtful.

A minority government, deemed undesirable by most parties, may be the only alternative but the country hasn’t had one since the end of World War II.

Long Road Ahead for Spain

Prime Minister José Luis Rodríguez Zapatero of Spain speaks at the European Parliament, Brussels, July 6, 2010 (Pietro Naj-Oleari)
Prime Minister José Luis Rodríguez Zapatero of Spain speaks at the European Parliament, Brussels, July 6, 2010 (Pietro Naj-Oleari)

Spain is the last major economy of Europe still mired in recession as its government remained committed to socialist doctrine throughout 2009. Massive deficit spending has only worsened the country’s predicament however, forcing Prime Minister José Luis Rodríguez Zapatero to finally start reining in Spain’s mounting debt.

Last month, Professor Niall Ferguson of Harvard University warned that “the contagion” currently rocking Greece would spread to other eurozone members, Spain foremost among them. The markets had woken up, he announced, realizing that the fiscal policies of countries as Spain had not been “credible”.

In the wake of the economic turndown, the Spanish government maintained a deficit on its budget of so much as 10 percent, refusing to cut on expenditures. The country’s pre-crisis growth has largely been carried by a boom in real estate. When construction came to a standstill, nearly 20 percent of Spanish workers lost their jobs. The country as a whole continues to face an enormous trade deficit on top of that.

The government simply has got to start spending less. According Bob Holderith, CEO of Emerging Global Shares who appeared on the Fox Business Network on Tuesday, “They’re going to have to get their economy under control.”

Holderith’s solution is investment, which is exactly what Prime Minister Zapatero has been hoping for. But with literally millions of people out of a job and millions of homes unoccupied there is little incentive to invest in Spain right now. Holderith admitted that the road to recovery for Spain will be a long one.

There have been some encouraging signs from domestic demand and exports recently and the country’s economy minister is supposed to be working out an austerity package that will bring the deficit down to the European maximum of 3 percent by 2013. Zapatero said that his government is “committed to these projects,” although conservative opposition leader Mariano Rajoy suggested that both the prime minister and his proposals lack credibility.

“It’s not Spain that inspires lack of confidence,” Rajoy told Zapatero in parliament last month, “it’s you and your government’s way of handling the economy.”

The conservatives are especially resistant to a proposed increase in value-added taxes which will only diminish the slight surge in consumer demand, they warn. Household consumption was up by 0.3 percent in the quarter of last year — pretty much the only good news there has been for the Spanish economy in some time now.

Right Wing on the Rise in Dutch Elections

Dutch voters went to the polls on Wednesday to elect city councils in almost four hundred municipalities. In the wake of the government’s collapse two weeks ago, the local elections were closely watched as an indicator of which way the country will swing this summer.

Both of the resigning ruling parties, the Christian Democrats and Labor, suffered in the polls although the latter has managed to improve its poll numbers somewhat compared to when it was in government.

The opposition is emerging with vigor. Nationwide, both the anti-immigration Freedom Party of Geert Wilders and his nemesis, Alexander Pechtold, of the center-left Democrats are on the rise. Locally, the right-wing liberal party is expected to come out with most support.

The liberals, in part, have Wilders to thank for their comeback. His party competes in only two major cities. Many of his supporters in other parts of the country opt for the liberals because their immigration and security policy is similar to his, if less Islamophobic.

The progressive Democrats are also indebted to Wilders. Pechtold has positioned himself as the right-wing foreman’s staunchest critic in parliament, emphasizing the Netherlands’ traditionally open and cosmopolitan character as opposed to the nationalism of Wilders and his party.

Since he ran and won on his own ticket in 2006, Wilders has made a series of dramatic proposals to curb what he calls the Islamization of the Netherlands, including banning of the Quran and taxing Muslim women for wearing headscarfs. Wilders is awaiting trail for accusations of hate speech.

According to the polls, the Socialist Party will have to give up over half of its seats. The more moderate Green Party instead would nearly double its support.

Conservatives for Freer Schools

A novel idea from British Conservatives: allow schools to set their own standards. Tory Politico reports that the party intends to put an end to government interference with so-called A Level certificates: the internationally-recognized standard for entry into British universities.

The A Level’s reputation has been on the decline in recent years, leaving the prestige and performance of academics in Britain frustrated. In order to reverse the trend, the Conservative Party promises to take power away from the Department for Children, Schools and Families as well as the Qualifications and Curriculum Development Authority to allow experts with colleges, research institutes and exam boards to decide on the content and structure of exams. According to Shadow Secretary Michael Andrew Gove, they represent the “institutions with the greatest interest in maintaining standards at A level.”

The individuals with the keenest interest in ensuring A levels require the depth of knowledge necessary to flourish at university are our teaching academics.

The Current Problem in the Falklands

In 1982 the Buenos Aires government under General Galtieri invaded the Falkland Islands off the south coast of Argentina with a force of several thousand soldiers, overwhelming the garrison of Royal Marines stationed on the island. On the same day the Royal Navy was ordered to assemble a task force to reclaim the Falklands by force. The history of the conflict can be found in many books but despite a British victory exacting over six hundred Argentine lives the causes of the war persist to this day, at least in Argentina.

The claim to the Falkland Islands (or Malvinas as they are known to Argentinians) is one of proximity and historical claim; i.e., that they are much nearer to the Argentina than they are to Britain. Secondly Argentina, after gaining independence from Spain, sent a ship to use the islands as a penal colony. This was never accomplished due to a mutiny aboard the vessel. In 1833 a British force arrived and claimed the desolate islands. They have since seen the establishment of settlements, from which grew the current population of Falkland islanders. In the minds of Argentinians however, the islands are “rightfully” theirs. Read more “The Current Problem in the Falklands”

Rethinking NATO’s Future

It wasn’t too long ago that NATO’s post-Cold War purpose seemed perfectly clear. During the Clinton Administration, the United Stated led allies in humanitarian efforts around the world but in Europe’s backyard especially. Up to this very day, Western forces are actively engaged in peacekeeping in former Yugoslavia and, of course, in Afghanistan.

The Afghanistan mission however, within the context of counterterrorism and -insurgency, has cast doubt upon NATO’s proper role. European allies are increasingly weary about risking soldiers’ lives for the sake of ensuring peace and stability in regions far beyond their borders. Many countries contribute only modestly to ISAF; others, like Canada and the Netherlands, are preparing to pull out altogether while in the United States, traditionally the most supportive of military endeavors overseas, public support for the war is shrinking.

At the same time, former Cold War rival Russia isn’t at all enthusiastic about NATO’s eastward expansion. The Russian Bear roars anew, intend on safeguarding its former spheres of influence.

No wonder then that Secretary General Anders Fogh Rasmussen is planning for the NATO of tomorrow. He has invited former US Secretary of State Madeleine Albright to chair a panel that will make recommendations about the organization’s future. Albright is thrilled to do it. “NATO has been a thread throughout my life,” she told Politico last week.

Albright describes NATO’s challenge as follows: “How does an alliance that unifies peoples and values under a common defense, created to defend against a threat that no longer exists find relevance against a whole new set of threats?” Especially when at least part of that alliance doesn’t considering fighting wars in the Middle East directly in its own interest.

In NATO’s ill-defined twenty-first century role — serving as something of an international police force while trying to bring peace and democracy to other parts of the world — Western European member states, in spite of all their admiration for President Barack Obama, have been reluctant to pitch in. For a new Atlantic order to take shape, the alliance must find a way to get Europe more involved.

That is why current Secretary of State Hillary Clinton, speaking in Washington DC yesterday, stressed that the EU is no competitor of NATO. “We see a strong Europe as an essential partner,” she said.

“NATO’s success in providing a security foundation for Europe’s transformation is one of the great accomplishments not only of NATO but, as many of you also believe, of any political-military alliance in history.” The alliance has fostered political and economic reform and “helped create the stable, democratic Europe we see today,” according to Clinton. As such, the alliance should “continue to keep its door open to new members.”

Clinton is aware of Russia’s unease with NATO expansion. “While Russia faces challenges to its security,” she said, “NATO is not among them.” The secretary called on Russia to collaborate with the alliance on the missile defense of Europe and the fight against nuclear proliferation. “European security will benefit if NATO and Russia are more open about our armaments, our military facilities, and our exercises.”

As the United States see it, the original tenets of NATO’s mission — “defending our nations, strengthening transatlantic ties, and fostering European integration” — still hold. But in an interconnected world, the alliance cannot accomplish that mission by crouching behind its geographic boundaries. “Reality has redefined the area in which we operate.”

For the organization to survive into the twenty-first century, said Clinton, “we’ll need to ensure that the evolution of NATO’s political capabilities keeps pace with its operational capabilities.”

This means that it may also have to provide civilian capabilities, especially in the early phases of a crisis when it is the only institution in the field. For too long, our alliance has been hamstrung by those who argue that NATO is an exclusively military organization and oppose attempts to develop — or in some cases even to discuss — the alliance’s capacity to take on civilian responsibilities.

The war in Afghanistan has shown that NATO cannot fulfill its new, broader purpose without developing non-military means to resolve conflicts. “If we are going to succeed in counterinsurgency warfare,” said Clinton, “NATO must continue developing mechanisms to draw on the existing security-oriented civilian capacities of its member states.”