• Do the Germans Realise the Damage They Have Done to Themselves and Europe?

    The Wehrmacht had a crack at it – but that attempt ended in disastrous failure 70 years ago. The long-held dream of German hegemony throughout Europe is, however, back on the agenda and closer than ever to realisation.

    The Greek crisis threw up many sub-plots – many of them of great significance of course to the Greeks themselves. But the real story of the Greek crisis is one of much wider import. It has stripped bare to the public gaze just where the pan-European project is really heading.

    What we have witnessed over recent months is a painful lesson being handed out to the Greeks – but even more importantly to the rest of Europe. Opinions may differ as to how responsible the Greeks may be for their own plight but what is now clear is that being part of “Europe” does not allow for any back-sliding if events move against you.

    So, the Greeks – having already being forced to accept over several years the most destructive of austerity packages – have not only been compelled to accept yet another instalment but have also been stripped of their powers of self-government and of democracy itself.

    The bail-out deal forced through the Greek parliament at the behest of European creditors makes absolutely no sense in economic terms. Even the IMF agrees that it makes it impossible for the Greeks to produce the resources needed just to service, let alone repay, their debts; and that is both totally unreasonable and lacking in reason, not only for the Greeks but for the creditors themselves.

    But it is the geo-political consequences that are most worthy of note. The Greeks have been treated with scarcely concealed contempt. They have been deliberately and ruthlessly humiliated. The wishes of the Greek people and of their elected government have been over-ridden by external forces who have no concern for their welfare.

    The Greeks have suffered this fate, not because they are uniquely culpable, but “pour encourager les autres”. The message has been deliberately designed for the rest of Europe. It is addressed to all those other small and medium-sized members of the euro zone who have suffered under the austerity regime forced upon them. The message is stark – there is no escape.

    Any country that might contemplate, as an alternative to euro-austerity, the reclamation of the powers of self-government and monetary sovereignty will be ruthlessly cut adrift. Even the Greeks, benighted as they are, could not brave that fate. The euro-zone is quite evidently a straitjacket, centrally applied and disciplined, whose rules over-ride democracy and the interests of ordinary people.

    And who or what, exactly, runs this arrangement from which there is no exit? It is German economic power. The troika of the IMF, the European Central Bank and the European Commission may look comfortingly like a European or even international authority, but the levers of power are actually moved by the German government.

    One of the most significant aspects of this unfolding landscape is the extent to which the Franco-German duumvirate, which we used to think actually called the shots, has been left in ruins. The Germans have felt no inhibition or compunction in letting it be seen that it is their view that must prevail. It is a measure of growing German confidence that they could quite publicly reject the preference of their erstwhile partners for a softer approach, and focus instead on giving overt priority to what they see as German interests.

    The mailed fist is now clearly visible. Any country in the euro zone that steps out of line will find itself forced back, with its own government and parliament sidelined and left impotent. There can be no debate. There can be no alternative to austerity; neo-classical economic policy and continued stagnation at best is, by decree of the German government, the only option.

    The German goal is to establish German hegemony across the whole European economy by ensuring that the policies framed in Berlin are adopted and applied across the continent. They have not found it necessary to fire a shot. But the way forward is not without its risks and casualties.

    Any misapprehension about how Germany sees its role in the new Europe has now been dispelled. German ambitions will henceforth be looked at much less tolerantly, and will meet increasingly strong headwinds. Angela Merkel’s confidence that she no longer needs to dissemble about those ambitions will certainly be put to the test.

    More importantly, the European ideal has been seriously compromised. A Europe revealed as simply a vehicle for German power is a very different entity from the force for peace and unity which has been sold to us so far.

    Europe over many centuries has faced the problem of restraining whichever was the dominant power of the time. They have usually succeeded, one way or another. That is unlikely to change. The Greeks will not be the only ones to pay a price for their bail-out. Europe’s future, too, is now more clouded and uncertain.

    Bryan Gould

    17 July 2015



  1. Sanctuary says: July 17, 2015 at 11:27 pmReply

    “…Europe over many centuries has faced the problem of restraining whichever was the dominant power of the time. They have usually succeeded, one way or another…”

    No, the BRITISH have always been horrified by the rise of an European super-state grounded in central Europe. And we all know that “one way or another” is a polite term for war. The EU project is now fatally wounded. I can only read the British press, and mainstream intellectual opinion from the left and the right in the UK has gone from lock step pro-Europe to a unified horror at the ruthless application of the German diktat. All further integration of the EU will come to a screaming halt; The French will seriously reconsider Europe in favour of an Entente Cordiale arrangement with the UK. The Germans are presiding over a return to a pre-1945 Europe, with middle powers jockeying for the patronage of peripheral major powers as they seek to check each others power. It is scenario the Germans will always lose, but they never seem to learn that they are always going to be a pygmy compared to the combined Atlantic powers or the combined Slavic powers. I don’t think that all this automatically presages a return to war, but the psychological shift in intellectual opinion in Europe seems significant to me. It reminds of something written by, I think, A.J.P. Taylor when he noted that the 1938 Munich agreement caused a massive shift in the psychology of the British, from one of a post Great war mindset determined to prevent another general European war to a determined resolution to oppose the Germans, come what may. Hitler completely missed this change in British opinion, and invaded Poland. I suspect the Germans will completely miss the change in attitude to them this time, as well.

  2. Patrick Holt says: July 22, 2015 at 4:16 amReply

    I agree in general, but differ in detail. It seems to me that the elephant in the room, or perhaps the current “spectre stalking Europe” is financial sector insolvency, and banking collapse. Austerity policies depend upon debt financing, to cover the inevitable budget deficits created by shrinking the real economy. Likewise QE is currency devaluation by credit creation, and so are the Greek and every other bank bailout made of credit creation. In fact, no money is being spent by European governments on the next proposed Greek bailout, just like no money was spent by European governments on the 2010 bailout. It is all being borrowed, from the IMF and from European banks (which are themselves already insolvent and only being propped up by the combination of QE and interest payments from the Greek people, as well as from every other European and North American state, coming from revenue (or in Greece’s case, from previous bailout loans). The unavoidable outcome, and necessity, is for all this unpayable debt to trigger banking collapse, and be wiped out by institutional bankruptcy, as and when governments decide to stop making the payments, or simply, as with the Greeks, are no longer able to. Wiping out the banks which have, with neo-liberal ideological assistance governing parties, made themselves “too big to fail” would dispose of the giant parasite sucking the life out of every economy, and at the same time remove the political cancer of financial sector lobbying and corruption infecting every major political party and every news service in every austerity-obeying country. It is not kill or cure. It is cure, followed by recovery. The Eurogroup imposed deal has only slightly deferred the evil day. Since everyone knows the new Memorandum will not work, Greece will simply be back to the same state of crisis, more weakened and drained, on the point of banking collapse and unable to continue making its payments to the IMF, ECB and French and German private banks, not at the end of three years, but many months, if not over a year earlier. The question will be whether the IMF and the US, and election results elsewhere in Europe will have brought the Euro-group to its senses by then, and whether Syriza, and like-minded parties elsewhere in Europe (possibly including a British Labour party headed by the entirely excellent Jeremy Corbyn) will have used the time to make the necessary preparations for banking collapse and the reform, or disassembly of the Eurozone. It is not only the neo-liberals who are living in denial about the sustainability of the current credit-based financial-asset-bubble economic model, but also those would-be leftists who imagine that there is some way out of austerity without breaking the banks and dependency on credit creation.

  3. Tony McArdle says: October 4, 2015 at 5:39 pmReply

    Imagine that each of the Euro-zone countries overnight had a new currency called the “[country name]euro” & each one of those currencies was allowed to float.
    The “German euro” would increase in value by not less than 60%. Overnight!
    There is the problem.
    Germany is trading under cover of a massively under valued currency, thus making possible its vast export success & driving the other euro-zone countries into penury.
    Brexit can come not a day too soon.

Trackbacks for this post

  1. Do the Germans Realise the Damage They Have Done to Themselves and Europe? | Think Left

Leave a reply.