Is Britain Going Mad?

Alphen, the Netherlands.  22 December.  Is Britain going mad?  Please someone tell me it is not so.  Sitting here on this side of the Channel I have been following over the past couple of days what passes for a debate on racism in English football.

On Tuesday Mr Luis Suarez of Liverpool Football Club was found by the Football Association to have used language against an opponent that may have had racist overtones.  He was banned for eight games.  If he did indeed use racist language then the sanction is just as such language does indeed have no place in modern society.  However, what is dangerous about this incident is that it appears that it is simply the word of Mr Suarez against that of his accuser Mr Patrice Evra of Manchester United.  There are no other witnesses. 

If that is the case then it would appear to mean that a black person can now make a career-damaging accusation and all that matters is that the accusation is made.  That would go against all tenets of natural justice.   

On Wednesday formal charges of racist abuse were laid against the England Football Captain Mr John Terry by the Crown Prosecution Service (CPS).  I will not comment on that case as it is sub-judice but the way in which the press reacted had all the hallmarks of a witch-hunt.  Sadly, the CPS seems increasingly political  and politicised and I really do hope Mr Terry gets a fair trial.  

Today, Mr Alan Hansen, a football pundit, is being hunted down by the PC wolves.  Last night he referred to black people as 'coloured' on the BBC's Match of the Day, a soccer programme, although clearly no offence was intended. Mr Hansen was clear in his message that racism is wrong even if his use of language was perhaps out-dated. 

What is behind all of this?  First, the derided media are trying to prove their PC credentials by attacking individuals for what are in many cases the slightest infringement of race rules and laws that have become now so draconian that ancient liberties are at stake.  Second, the London elite seem determined to ram this issue down the throats of Britons as a warning and because of profound failures of policy.  Indeed, these witch-hunts are becoming so shrill that they reflect the steady and dangerous shift of hitherto irritating political correctness into something far more sinister; socio-fascism. 

Sadly, this PC madness will only make community relations more tense, not less so as a non-racist but nevertheless fed up English majority feel that implicit in this frenzy is the suggestion that a) they are all racist by association; and b) a precedent is being established by which the law will be applied in favour of one section of society against the rest. In recent polls 85% of the population object to the Establishment obsession over race and racism believing it to be over-reacting.

Racism is wrong and must be dealt with but in a patient and common sense way, not the kind of public show trials that now seem to be the norm and which seem to be taking place almost weekly.  Remember, I know what damage discrimination can do to a person and a career and I oppose all forms of such behaviour as I have myself suffered from it.  The real danger is not that people will stop saying racist things, but that they will stop saying anything anymore for fear of being accused of racism.  If that happens they will join the many millions of Britons who have retreated into sullen silence at work and elsewhere for the very same fear.

Where are the British going with all of this? Maoist-style re-education classes? Thought police?  The Dutch think the British are going mad over this issue.

Britain used to be renowned for common sense, tolerance and balanced thinking.  On issues of race and racism that is clearly no longer the case.

Julian Lindley-French    

Guido Westerwelle: Europe’s New Hillary Clinton?

Alphen, the Netherlands. 21 December. Watching German Foreign Minister Guido Westerwelle with British Foreign Secretary William Hague this week I was reminded of a John F. Kennedy quote; “The problem with power is how to achieve its responsible use, rather than its irresponsible or indulgent use”. That is not to suggest that Westerwelle is in any way irresponsible. Indeed, what struck me about Westerwelle in London was the vision of a German foreign minister behaving on the European stage much like a US secretary of state on the world stage. It is clear that Germany really does now lead Europe, just as it is clear that Britain is critical to German leadership. 

Westerwelle had come to London, “…to build bridges”, and described Britain as an “indispensable partner”. At one level this is a French nightmare and explains the provocations from Paris of late. Paris is always concerned that Berlin will do a deal with London that is not made in Paris. Equally, it would be a mistake for Britain to believe there are tensions between France and Germany to be exploited. The French are clearly in on this ‘good cop, bad cop’ strategy, as evinced by this week’s British-friendly amendments to the EU Common Fisheries Policy which were supported by both Berlin and Paris purely for reasons of grand strategy.  

Britain must therefore stand on strategic principle, but is London any longer up to the task? The many attacks on Prime Minister Cameron by London’s Chicken Littles miss the point...as per usual. Cameron’s Brussels ‘no’ was strategic, even if the way the British approached the failed summit was more Ealing comedy than grand epic. “The Economist” called Cameron’s stand a mistake. This merely reflects briefings against Cameron by British diplomats so long lost in the EU trees that they are unable to see the strategic woods.

In fact, Cameron achieved precisely what I said he would achieve at the time. He forced Germany to deal with Britain not simply as another member of the EU 27 but rather as a great power. There was always something strategically unworldly about the idea that even in the teeth of the Eurozone crisis Britain would simply acquiesce to a fiscal union built around Germany that by its very nature would critically damage Britain. Turkeys do not normally vote for Christmas and yet this is what the critics were calling for.

Britain’s strategy towards Germany should be clear and simple. Any move now towards fiscal and political union would by definition exaggerate German power and influence.  Any such ‘union’ would force the weak into a system organised around Germany. As such the Union would begin to look more like an empire than a community, even though that clearly is not Berlin’s intention.  In Europe of all places power must be held in check.  However, the EU as currently structured affords no such checks. Therefore, Britain must act as the check on German power and to that end Berlin must work in partnership with London if German leadership in Europe is to be legitimate and to be seen as such.

Equally, both London and Berlin must recognise the limits to partnership. Westerwelle talked of European integration as ‘…the answer to the darkest chapter in our history”. World War Two may have been the darkest chapter in German history but the British still see it as their "finest hour", to quote Churchill, and modern Britain’s defining moment. The idea that somehow Britain will in time subordinate itself to German power, even if dressed in European finery, is wrong and Westerwelle seemed to be implying that.  Britain must always make Germany work hard for British support and the maintenance of some distance between the two powers is therefore vital. The political balance of Europe depends upon it.

So, what about Westerwelle the man? Is he Europe’s new Hillary Clinton? In some respects he is more Nick Clegg than Hillary Clinton; a junior liberal, coalition partner to a conservative leader. He has also made mistakes, such as Germany’s abstention on a key Libya vote in the UN Security Council which sided Germany with China and Russia against Britain, France and the US. His motivation seems to have had more to do with his party’s perilous position in German regional elections than responsible international politics. It is a trait of imperial power to impose local politics onto international partners.  Privately the Americans have compared Westerwelle unfavourably with one of his predecessors Hans-Dietrich Genscher who played a critical role in the unification of Germany…and the 1990s disaster in the Balkans. However, shuttle diplomacy in a crisis clearly suits him reinforcing not only his own credibility but German leadership.

And finally... may I take this opportunity to wish all of you who have done me the honour of reading my thoughts this past year a very Merry Christmas and a Happy New Year. No, ‘happy holidays’ here – that is far too politically-correct. More blasting to come in 2012!

Julian Lindley-French

The Power of the Powerless: In Memory of Vaclav Havel

Alphen, the Netherlands. 19 December. Two men died this weekend. One was a towering literary and political figure, one of my heroes, a man who understood change and freedom and put his life on the line for it. The other was not; resisting change and freedom at all costs in the defence of an extreme version of a failed idea against which the other fought.

Vaclav Havel was a Czech patriot, playwright, poet and president who broke the crushing bureaucracy and terror of absolutist totalitarianism. Kim Jong Il was a North Korean born to be president of a dynasty in the ludicrously named Democratic People’s Republic of Korea, an absolutist, totalitarian state that is neither democratic nor of the ‘people’. Son of his dictator father the Dear Leader exercised power through terror, the crushing bureaucracy of an overweening state and by blackmailing neighbours with the threat of an over-costly military and nuclear weapons. Both in their ways defined their age in their space, and yet they occupied opposite ends of truth.

Let me deal first with President Kim Jong Il. Enough said.

Vaclav Havel wrote; “The exercise of power is determined by thousands of interactions between the world of the powerful and that of the powerless, all the more so because these worlds are never divided by a sharp line, everyone has a small part of himself in both”. Europeans have fought for centuries to ensure that the powerless have sufficient ownership of the powerful to render accountability real; the very cornerstone of democracy.

Sadly, Central and Eastern Europeans understand the value of freedom in ways which shames us all in Western Europe, where dangerous complacency reins. Perpetual vigilance is vital to protect freedom, particularly at times of crisis such as this. European history is replete with fool's contracts; “we the powerful will resolve the mess we have created if only you the people give us more power and all your money”. Havel would have rejected a choice between being bankruptcy and freedom, but if choice was forced upon him he would have chosen the latter.

Small was beautiful for Havel. Indeed, Havel believed passionately that power should be seen to be alongside the people, in the people, with the people. His desire to bring power down from the high perches of pride it so often and too often claims for itself in Europe saw President Havel oversee the break-up of Czechoslovakia into the Czech Republic and the Slovak Republic. That was the will of the people.

Havel found the presidency an uncomfortable part in a theatre de l’absurde, describing himself ‘absurd’ at his investiture in Prague Castle. And yet perhaps it was not Havel who was absurd but rather the ridiculous ego-driven pomposity, perks, and police-escorted pageantry that Europe’s new great and increasingly not-so-great now routinely claim for themselves in the name of ‘protocol’. Havel rightly mistrusted power and the people with it.

As Europe teeters on the edge of a financial and economic abyss the truly powerful call for more power. There is a very real danger that power in Europe will become systematically ever more distant from the people – the very anti-thesis of freedom and democracy. This elite-driven project comes in various ‘plays’ and ‘acts’ on stages from Berlin to Brussels. Some call upon one superpower state to lead in the name of ‘Europe’, others call for a super-state that is ‘Europe’. Both threaten democracy and freedom if not held in check. Sadly, checks and balances are being eroded in the name of 'Europe', with Havel's Europeans patronisingly encouraged to disengage from the political process, ‘our’ political process and to ‘leave it to them’.

For that reason above all other Havel was an inspiration for this blog and its own self-satirising and pompous mission to ‘speak truth unto power’. Indeed, I see myself as a true Havelist because I have never lost, nor will I ever lose my capacity to laugh at myself. However, whilst I am and can only ever be a pale imitation of my Czech hero my mission remains deadly serious – the defence of freedom in Europe.

Europe is most decidedly not North Korea. We Europeans do at least retain the semblance of choice over our leaders that the Dear Leader denied his people. Moreover, our leaders for all their many faults are not Kim Jong-Il. Nationally-elected political representatives in national parliaments are close enough to the people to understand them and their needs and yet close enough to power to hold to account the eternal and infernal ambition of the super-ego. May it ever be thus. 

‘Europe’ remains a good idea in a world that is getting ever bigger as ‘we’ Europeans get ever weaker. However, Big Europe also threatens freedom even if it is not intended and must be guarded against. Havel understood the danger of seeking efficiency and effectiveness at the expense of democracy and freedom. Throughout history that has been the seductive, siren call of the powerful in pursuit of absolute power in the teeth of crisis. The pursuit of absolutism comes in many forms but it is always ‘for’ the people and in the name of the ‘people’, as it is in North Korea. Europe is a long way from that but 'we the people' must remain vigilant.

“I really do inhabit a system in which words are capable of shaking the entire structure of government, where words can prove mightier than ten military divisions”. It was Havel’s optimism that attracted me to him all those years ago, precisely because the system he had fought against had failed to crush Havel’s self-defining ‘hope’. In Havel’s Europe the line between the powerful and powerless must remain blurred even if it is not ‘efficient’. Let us all honour Havel the man by respecting his vision for Europe.

In honour and in memory of Europe’s great, ordinary man. Vaclav Havel was a friend I never met.

Julian Lindley-French

A Week is a Long Time in High and Low Politics

Alphen, the Netherlands. 16 December. In 1964 former British Prime Minister Harold Wilson said, “A week is a long time in politics”. This has been a very long week for both high and low politics.  

A week ago I was waking up in Brussels to the British ‘non’ to the Brussels Botch. This was European low politics at its worst as Euro-fanatics and the plain anti-British spurred on by Berlin and Paris attempted to shame Prime Minister Cameron into reversing his position and to blame Britain for a collective failure of strategy and politics. Sadly, they were aided and abetted by the strategically-inept back in London who a) illiterate in the language of power panicked at the thought of British ‘isolation’; and b) seemed willing to pay any price to keep the Germans and French happy. The British reaction was as one would expect – defiant. The British people were up for a fight and it showed.

Recognising the impasse Chancellor Merkel made a conciliatory speech mid-week in Berlin.  Britain will remain an important partner, she said. Was this a new political demarche? No. Last night, Christian Noyer, the Head of the French National Bank, called on Britain’s AAA credit rating to be downgraded. On the ‘not very helpful right now’ scale of ten that got at least a nine. Well done, M. Noyer.

It saddens me that the elite of such a great nation for which I have a genuine liking and respect seems unable to resist pressing the anti-Brit button whenever it does not get its way. French low politics will only trigger more British low politics and thus make it far harder to find a solution and maintain political momentum in other crucial areas such as defence co-operation. More worrying M. Noyer would appear not to understand either the nature of the Eurozone crisis or the causes of it. Thankfully, London reacted in a measured and appropriate tone to M. Noyer’s engineered outburst, something I am sure Berlin will have noted.

Let me now switch to the other side of the ‘pond’. On Wednesday President Obama made a speech at Fort Bragg marking the end of nine troubled years of American military presence in Iraq. Since March 2003 over 100,000 Iraqis and 4500 Americans have died with many thousands more wounded, not to mention the dead and wounded from the other coalition partners who took part in Operation Iraqi Freedom.

If Europe is being broken by an excess of low politics, America is endeavouring to extricate itself from an excess of ill-considered high politics. President Obama said that whilst Iraq "is not a perfect place…we are leaving behind a sovereign, stable, and self-reliant Iraq, with a representative government that was elected by its people". The President went on, "We are building a new partnership between our nations. Because of you [US military personnel], we are ending these wars in a way that will make America stronger and the world more secure".  With the hindsight of history the Iraq War as a mistake; there were no weapons of mass destruction, it distracted from the main thrust of post-911 strategy in Afghanistan, cost huge amounts of money and many lives; and tied down American forces in such a way as to embolden the world’s real mischief-makers. The US may not be the world’s policeman, but it is the actor of last resort.

Back in 2003 Germany and France warned against this adventure.  Berlin and Paris were correct. The fact that Saddam is gone and some semblance of stability (and it is only a semblance of stability) has been achieved much of it due to the ability of American forces to adapt and learn, does not forgive the error of high politics America and Britain made. The 2011 consequences only indirectly reflect the 2003 war aim, "…to disarm Iraq of weapons of mass destruction, to end Saddam Hussein's alleged support for terrorism, and to free the Iraqi people". Critically, neither America nor its allies have been strengthened by this war and its aftermath, either in the ‘Greater Middle East’ (wherever that is) or the wider world.

The war crucially divided the NATO Alliance at a critical moment from which it has never really recovered and made America and the West seem far weaker than is in fact the case in the eyes of allies and adversaries alike. In particular, the American and British failure to properly prepare for the post-war stabilisation of Iraq was a profound mistake, much of it driven by Washington’s ideological belief that the invasion would be seen by all Iraqis as a liberation. 

What conclusions do I draw? It is questionable whether Europeans are any longer capable of high politics in the face of crisis. The gap between the rhetoric of Europe's leaders and their actions is now so wide as to border on self-deceit.    Equally, the gap between what America has to do and what it is willing or can afford to to do is itself becoming dangerously wide.  Indeed, for Washington the common ground between high and low politics in the international arena remains elusive. 

Above all, these two political failures, the  Iraq War and Eurozone crisis, have destroyed trust, that most precious of political commodities and the concrete foundation upon which all sound strategy must stand.

A week is indeed a long time in politics and this indeed has been a very long and a very bad political week.

Julian Lindley-French

"Very Well, Alone...ish"

My Dear Fellow Europeans, don't worry I have not gone terminally Churchillian...yet!  However, I thought you should all see Low's famous cartoon which all we British hold close to our hearts at moments of stress with you lot! And, let's face it you can be just so tedious.  Your only saving grace is that you are NOT American...and only some of you are French (c'est une pleasanterie, Nicholas).  That would be all together too much. All best, Julian

Be Careful Europe. You May Get What You Wish For

Alphen. The Netherlands. 14 December. Yesterday in Strasbourg at the European Parliament European Parliamentarians made some of the most shocking and inappropriate attacks ever against one member-state - Britain. The leader of the European People’s Party warned of ‘punishing’ Britain and of ‘tanks and Kalashnikovs’. In the feeding frenzy of myth-making and scapegoating much of it using language that verged on the profoundly disrespectful to Britain and its people.  Indeed, this was unparliamentary language at its very worst, a clear attempt to create a new ‘narrative’ for a crisis entirely of the Eurozone’s own making by placing responsibility on to the British for the appalling failure of Eurozone leadership. 

This is a blame game.  Indeed, it is a blatant attempt to implicate a country that is not even a member of their benighted currency and which warned against its structural contradictions from the very outset. Even President Barroso joined in this stitch-up…and we all know who is behind him. How dare they?

Some talked of British ‘egotism’ and ‘nationalism’. These people would not have the freedoms they enjoy but for the sacrifice of the British people in both World War Two and the Cold War. Some talked of a lack of solidarity by Britain. These are the same people who for years have dodged their responsibilities for Europe’s security and defence and imposed its true cost on the British people. These are the same people who have dodged their responsibilities in Afghanistan forcing the British to do too much of the dying. These are the same people who wringed their hands over Libya as the British did what was necessary to prevent a massacre in Benghazi. How dare European parliamentarians lecture Britain about solidarity?

As for the Eurozone crisis the full extent of the Brussels stitch-up is only now becoming apparent. There was no need for a new treaty, only Chancellor Merkel wanted that and by demanding it she sought to make the crisis one of the EU at 27 rather than 17. It is in any case already falling apart validating once again British pragmatism.  What is more to the point is that having tried to make this a crisis 'owned'by all 27 neither Merkel nor Sarkozy were prepared to offer Britain the joint leadership role befitting Europe’s second or third largest economy and strongest military power. No, Britain was expected to subject itself formally to German and French leadership even though she is one of Europe’s Big Three.  That will never happen.  How dare they?

And now these same people pretend that the Euro-crisis is all of Britain’s doing because London failed to properly regulate the banks in the City, many of which are German and French et al. They conveniently forget Germany’s failure at the summit to offer any real leadership to solve the immediate crisis. They conveniently forget the chronic debt into which their national leaders have pitched almost all of the Eurozone countries. They conveniently forget that Britain is the second net contributor to the EU and that the British taxpayer has for years been transferring huge amounts of money to southern and eastern Europeans with little or no prospect of any benefit. They also fail to notice that Prime Minister Cameron is climbing rapidly in UK opinion polls for saying 'no' to the wrong treaty at the wrong time for the wrong reasons for Europe.

Last week I warned against Britain retreating from Brussels however seductive the vision of our standing defiantly on the White Cliffs of Dover shaking our fist and rekindling the defiance of 1940. “Very well, alone then” was, I suggested, neither a policy nor a strategy for Britain. After yesterday’s sham of a debate in the European Parliament, more redolent of a fascist show trial than a modern, tolerant democratic Europe, I am no longer so sure.

Be careful Europe. If you continue down this road of abusing, blaming and scapegoating Britain for your own lamentable failings you may indeed get what you appear to want. Britain out of the EU.

Julian Lindley-French

Where Next for Europe?

Alphen, the Netherlands.  12 December.  A senior French official privately likened Cameron's negotiating position at last week's European Summit to that of someone invited to a wife-swapping party who failed to bring the wife.  Very French.  A more accurate metaphor would be someone invited to a seemingly perfectly respectable dinner party who upon arrival is told to sell his wife as the price of entry as the hosts cannot afford the party they promised!  In fact the Merkozy ambush on Cameron simply confirmed what was already apparent; the marginalisation of Cameron had been prepared beforehand. So, where do we go from here? 

At least we now know the German-French plan of attack against Britain and the message all their surrogates in the satellite states have been instructed to peddle.  I have just been watching Dutch TV and the Dutch Finance Minister, Jan Kees de Jager, explain to the Dutch people (with a straight face) that the Euro crisis was caused by a lack of banking regulation.  He implied that the British were unreasonable because they resisted more growth-strangling Euro regulation on the banking sector which would have disproportionately damaged Britain for a crisis not of its making.  Cameron made a mistake last week because he opened the door to this kind of nonsense by justifying his stance too narrowly on the protection of the City of London (which is questionable) rather than the profoundly important strategic implications of what Germany and France were trying to do - entrench Europe in growth-free protectionism. 

Yes, deregulation of the banking sector together with a lack of proper oversight did indeed cause a crisis back in 2008 for which the British taxpayer is now paying a high price.  However, the Euro crisis is not a liquidity crisis, as President Sarkozy would have us all believe, but a structural debt crisis.  Debt that was caused by a combination of German exports to a Eurozone which offset the high cost of German production, excessive government borrowing by Eurozone members, the expectation by southern and eastern Europeans that northern and western European taxpayers would go on transferring wealth indefinitely and the exposure of Eurozone banks to said sovereign debt.  The banking crisis may have exacerbated the Eurozone crisis but the cause of it...certainly not.

What the British did last week was to reveal the true nature of the power politics at play. Eurozone-Plus negotiations will now begin on the details of a new intergovernmental treaty designed to impose stricter budget controls on member-states via the European Commission (and, by further extension, via Germany).  There are already signs of the acute political tensions and the sovereignty-crushing implications of what the 24 'others' in the Eurozone-Plus signed up to.  The Socialist contender in the French presidential elections has said that any changes should be delayed until after the elections in May 2012 and in any case he would re-negotiate the deal.  Denmark and Ireland are hinting strongly at the need for referenda before any such treaty change can be ratified which would further delay a 'solution' to the crisis, time the Euro simply does not have.   

Two things are now needed; a sound political strategy in London and a cool head in Berlin. Implicit in the position of Chancellor Merkel is in fact a realisation that no amount of financial engineering or European Central Bank bond purchases will help resolve the immediate crisis.  Greece, and maybe even Italy and a few others, will sooner of later have to fall out of the Euro, if of course the currency itself does not collapse.  Indeed, in Brussels Merkel carefully avoided any commitment that might have been seen as a serious attempt to save the Euro as currently configured.  Germany's objectives instead seem to be to create a structure that would a) prevent a similar crisis destroying a German-centric survivor currency; and b) limit the impact of the inevitable on the German taxpayer.

Following German logic what really matters now is that Europe recovers over time to become competitive globally.  This also implies a further set of questions about the role and extent of future transfers from the western European taxpayer to the rest in pursuit of such an end and whether or not said taxpayers are prepared any longer to maintain such an open-ended commitment. That is why this moment is both structural and strategic.  And here is the irony.  Critical to that game will be the relationship between London and Berlin.  Here Britain has a strong card to play because not only is the single market central to that mission, whilst the Euro is the cancer killing the European body economic, but Britain and Germany agree about the need for a competitive Europe. 

Therefore, if cool heads prevail London and Berlin can begin a dialogue of strategic equals that would not have been possible if Britain had been reduced to a kind of super-Belgium by signing up to a hopelessly flawed deal last week.  Britain is not Belgium - it is the world's fifth or sixth largest economy which many serious commentators worldwide believe is the only European economy likely to challenge Germany over the next twenty or thirty years or so precisely because of its greater openness to the world.  Indeed, had Britain signed up to the Brussels Botch it would have been subjected to the same sovereignty-crushing constraints as the other Eurozone-Plus members with the added 'bonus' of having London pay for much of the cost of 'fixing' a failed currency via a future financial transactions tax 85% of which would have been paid in London.  Fair or what?

Today Britain has preserved the strategic room of manouevre worthy of one Europe's Big Three and which Germany and France last week tried to deny it. When Berlin emerges from its funk it will realise it has to deal with Britain.  The French are unlikely to make that connection whilst lost in pre-election 'faux' anti-Britishness.  Indeed, a more sober Berlin will realise that a deal with Britain is much more likely to promote the kind of economic reforms and disciplines Germany knows full well Europe needs to compete in this world. 

The alternative for Berlin is a structural relationship with France which simply sucks Germany ever deeper into a protectionist, statist, indebted Europe which sooner or later will be overrun by the very forces of globalisation enshrined in the City of London.  The longer Europe puts off those reforms the more deadly the crisis that will eventually consume it...and the current malaise is only a ripple of that economic tsunami.  Hopefully by then Britain will have long before readied itself for the real world.

Cameron?  He must hold his nerve against those many siren voices that seek French and German approbation at any price.  To say that it is twenty-six versus one is ridiculous.  It is two of Europe's three strategic powers versus the third.  All Europeans matter, and should matter equally, but the nature of this crisis has demonstrated the extent to which some Europeans are more equal than others.

Where next for Europe?  Avoid French wife-swapping parties.

Julian Lindley-French

     

Well Done, Prime Minister. Continent Isolated, Britain Right!

Alphen, the Netherlands. 10 December. T.S. Eliot wrote, “We are the hollow men. We are the stuffed men”. The most telling image from this week’s European Summit was British Prime Minister David Cameron sitting all on his lonesome in the Council chamber. Not only did it show the childishness of our Dear European Leaders, but also the extent to which this summit was really more power politics than principle. Time will show Cameron to have been right and our Continental friends should realize that the massive majority of Britons have no problem with standing alone. 

The summit was not about the Euro – nothing was done to fix that. Rather, it was about the rebranding of the European Union into an Empire. A German Empire led by Berlin with its French Passe Partout acting as agent. The hollow men and women of the twenty-four other member-states wished to do nothing that might offend Europe’s new headmistress, Chancellor Merkel. So, David Cameron was made to sit on his own in one corner of the room like some offending schoolboy. For Cameron it must have been like being back at Eton.  It was pathetic to observe, as I did – I was one hundred metres away.

President Sarkozy, employing the gracelessness with which we have come to associate with a man who does a great nation no honour, suggested that Cameron had made “unacceptable demands”. If he means by that that Cameron had acted to protect Britain’s core financial services and by extension the British people from a Euro-saving tax 85% of which would have been paid in and by Britain then I suppose that is ‘unacceptable’. Can you imagine a French president agreeing to such a punitive tax on a critical French industry? No way. Can you imagine a French president opening the door to an aggressive set of European regulations that would in time destroy said industry? One only has to look at the ninety-plus cases the French are facing in the European Court of Justice for breaking EU rules to know the answer. 

There is no such thing as a free tax and the result would have been the British people paying for a currency disaster that French newspaper Le Monde says rightly has nothing to do with the British. Moreover, Britain is already the second biggest net contributor to the EU mainly because of a previous Franco-German power play when they stitched up a deal on the Common Agricultural Policy (CAP) that forces the British taxpayer to subsidise French farmers. Sarkozy even had the temerity to suggest that banking deregulation had caused the Euro crisis. This may have something to do with the fact that in January the French will have to honour €52.9 billion in government bonds, a further €35.9 billion in February and by April a further €50 plus billion.

Taken together the refusal of ‘Merkozy’ to address Eurozone sovereign debt, Chancellor Merkel’s insistence that the European Central Bank cannot act as the lender of last resort and the failure to address Europe’s appalling growth-strangling over-regulation now dooms the Euro to failure. No amount of effort to shift the blame for failure onto Britain and Cameron will work because time, and not much time, will demonstrate who really is responsible. 

Of course, the usual suspects came out of the woodwork back in London to attack Cameron. The BBC’s flagship radio news programme ‘Today’ embarked on one of the most politically one-sided set of interviews and commentary’s I have ever heard. Retired diplomats such as Lord Hannay suggested that Britain will now be excluded from ‘process’. Lord Hezeltine even suggested that Europe is in its inevitable way to forming a United States of Europe. What planet are these people on?

They miss three simple verities. First, most political moments are indeed ‘process’, but every now and then a ‘moment’ comes along that is strategic. At such moments a stand needs to be taken and this was indeed a strategic moment. Second, a profound ideological split exists between a statist Europe beloved of the French and the more free market British who are much more attuned to global realities. To have signed a deal on those terms would have subjected Britain to European statist nonsense effectively ending all hope of the flexible economy Europe (and Britain) needs if it is to properly adapt to this globalized age. Third, and above all, not only the future of the Euro was at stake, but also the future power map of Europe.

The choice was between a legitimate Europe made up of democracies and a power Europe led by Germany and France. The deal on offer to Britain was in effect to become a super-Belgium subject to German and French whim. Berlin and Paris have done everything they can over recent years to exclude Britain from their power core and this was to be the final act. Britain will never accept subjugation to their leadership and rightly so.

Through the centuries there have been times when Britain has stood alone against the hegemony of one or two powers in Europe. This is another such moment and we British are again called on to make a stand. So be it! The one inspiring thing that came out of the Brussels summit was to see a British Prime Minister stand on an issue of principle. Now Britain stands clear in opposition to a Europe it does not believe in.  That is the best negotiating position London can possibly have. 

So, be sure of one thing Chancellor Merkel and President Sarkozy this game has only just begun. In Prime Minister Cameron you are facing at least one European leader who understands that.

Well done, Prime Minister. Continent isolated, Britain defiant…and right!

Julian Lindley-French

Stiffen the Sinews, Prime Minister

Alphen, the Netherlands. 8 December.

Dear Prime Minister Cameron,

We are both off to Brussels today. You are going to attend some minor event at which you are expected by your German and French hosts to play a minor bit part. I will be attending (and you will love this) a meeting on the cost benefits of a common European defence policy. Who says our Continental friends lack a sense of humour!

The EU Brussels Summit will be the most important European moment since Maastricht when the Treaty on European Union 1.0 was signed. Over the years it has slowly been expanded and now its tentacles reach into all aspects of British life. Each iteration of Euro-spread has seen a British prime minister draw a line in the sand only for it to be washed away by the oncoming tide of European regulation. Having made its strategic choice not to join the EU-defining single currency back in 1991 Britain’s semi-detachedness is no longer defensible. Either Britain joins the Euro or leaves the Union. There is no middle ground anymore and you must understand that is the reality implicit in this tous azimuths summit.

Indeed, what you will confront in Brussels masquerading as an attempt to save the confounded Euro is an attempt to effectively change the Union into an Empire. You must at all costs resist this. Your premiership depends upon it. What is at stake in Brussels is a precedent over the use of power by two EU member-states via the denial of sovereignty to the rest. This is a defining moment towards which the entire European movement has been travelling since its founding back in 1950.

Sadly, in the spin apparent on the airwaves and in the column inches you have instead decided to retreat and then mask your failure from the British people. You insist that because no formal transfer of power will take place between London and Brussels no referendum need be put to the British people. This is legalistic mumbo-jumbo and you know it. Implicit in fiscal union is a profound shift of power from London to Brussels via Berlin and Paris. The implications of a shift of power are just as fundamental as any formal transfer of power...in fact more so.

You say you will not make any “unreasonable demands” and that this is not the time to negotiate. When will there be a better time to negotiate? Do you think Germany and France are not fighting like mad for their narrow national interest? Of course they are. Indeed, their collective strategy is to a) give the impression that there is no alternative but their joint leadership - there is; and b) to pretend that Britain is irrelevant - Europe's second or third biggest economy (depending on exchange rates) and largest financial market.  And yet you seem to imply that somehow it is not cricket for Britain to fight for its national interest. They will laugh at you in Brussels. As President Sarkozy said this week, “...it is a joke, David”. As you old Etonians would say “play up, Mr Cameron”.

And here is the rub (I will indeed become Shakespearian). Yes, saving the Euro for now is an important mission, but not at the expense of Britain’s sovereign will and strategic influence and you must realise the distinction between the two. This is about power and you must enter that room in Brussels clear in your head that you will not sell Britain’s crown jewels. Indeed, the real mission is not to save the Euro per se, but rather to resolve the financial crisis caused by the appalling duplicity of those who established the single currency. That can only be done at 27. If Berlin and Paris insist on a separate treaty of the 17 Eurozone countries then it is a power grab – pure and simple and should be seen as such. Behind it will be a principle of German and French power leadership in Europe that Britain must resist today just as it has always resisted.

By all means be constructive where you can but in return you must insist on a new relationship for Britain with the EU built on a set of quid pro quos. The more Germany and France insist on other EU member-states ‘opting-in’, the more you must insist on ‘opting-out’. The more EU state sovereignty Berlin and Paris want to bring under their control via the supine European Commission the more you must insist real power is ‘repatriated' to London. Specifically, you must demand an end to the German and French-inspired Commission attempts to impose their statist ideology on the City of London. You must also insist that the Working Time Directive no longer applies to Britain and all aspects of the Treaty on European Union that deny Britain real control over its borders are also repatriated. Above all, if they go for full exclusion of Britain from all aspects of EU economic governance you must make it perfectly clear that you will call an in-out referendum.  For that is what is at stake. The alternative is taxation without representation.

If you think that distasteful and too narrowly self-interested then just go to the web-site of the European Court of Justice. There you will find a page devoted to member-states breaking their treaty obligations when it suits their national interest. Germany has twice as many cases pending before the Court as Britain and France three times as many. For all the talk emerging from Berlin and Paris about the need for ‘discipline’ you can bet your bottom Euro that it will not apply to them. And remember, you have many more friends on this side of the Channel than you seem to realise if for once you can think strategically rather than tactically – your biggest failing. The mere sight of you fighting will galvanise other Europeans thus far intimidated by the German-French fait accompli.

I am not wont to quote Henry V but I think this summit warrants a little paraphrasing, Prime Minister. “In peace there’s nothing so becomes a man as modest stillness and humility; But when the blast of ‘jaw’ blows in our ears then imitate the action of the Tiger”.

Stiffen the sinews, Prime Minister.

Yours sincerely,

Julian Lindley-French

PS I will let you know how our talks about a common European defence policy get on. Don’t hold your breath!

Pearl Harbor: A Date Which Will Live in Infamy

Alphen, the Netherlands. 7 December, 2011. Seventy years ago today at 0600 hours Pacific Time on December 7, 1941 Captain Mitsuo Fuchida launched Operation Z from the Imperial Japanese Navy aircraft carrier Akagi, flagship of the attack fleet. Fuchida led one-hundred and eighty-three dive bombers, torpedo aircraft and fighters in the first wave of strikes against the US Pacific Fleet anchored at Pearl Harbor, Hawaii. Minutes later a further one hundred and sixty attack aircraft took off from five other carriers – the Kaga, Soryu, Hiryu, Shokaku and Zuikaku.

Some two hours later the surprise attack had sunk four US Navy battleships, with four others badly damaged, along with three other ships sunk and seven damaged. One hundred and eighty-eight US Navy and US Army Air Corps aircraft had also been destroyed. Sadly, two thousand four hundred and two US military personnel were killed and one thousand two hundred and forty seven wounded. Fifty-seven civilians were also killed and thirty five wounded. The Japanese lost twenty-nine aircraft and five midget submarines with sixty-four personnel killed and one captured.

Two days later the British battleship HMS Prince of Wales was sunk together with the battlecruiser HMS Repulse, with the loss of eight hundred and forty Royal Navy sailors. For the British the tragic irony of Pearl Harbor was that the Japanese High Command had been inspired by the British naval air attack of 11-12 November, 1940 on the Italian fleet base at Taranto. This attack was launched from a task force under the command of Rear-Admiral A. L. St G. Lyster RN and which included the fleet carrier HMS Illustrious.  Twenty-four aircraft from 813, 815, 819 and 824 Squadrons Fleet Air Arm successfully crippled the Italian Fleet.

Strategically, the Pearl Harbor attack was a failure. Captain Fuchida failed to deliver the knock-out blow the Japanese had hoped for. The Japanese Commander-in-Chief, Admiral Isoruku Yamamoto, may or may not have said, “…all we have done is to awake a sleeping tiger and fill him with a terrible resolve”. However, he is on record as writing; “This war will give us much trouble in the future. The fact that we have had a small success at Pearl Harbor is nothing”. His words were indeed prophetic. All but two of the eight American battleships were raised and returned to war service. Critically, the three US fleet aircraft carriers, Enterprise, Lexington and Saratoga were at sea and unharmed. US carriers were to prove decisive in the destruction of the Japanese carrier fleet at the Battle of Midway six months later between 4 and 7 June, 1942.

The US has been criticised many times since Pearl Harbor for poor leadership, usually without cause. In the aftermath of Pearl Harbor President Roosevelt showed himself to be a master of strategy. First, he decreed that the war in Europe should take priority even though the American people were clammering for revenge over Japan. America’s great European age in many ways began in the Pacific. Second, American industrial might was mobilised and proved the decisive factor in the winning of the two wars – one in Europe and one in the Pacific. Third, the manner by which the US conducted the island-hopping war in the Pacific was a true revolution in military affairs leading to entirely new ideas about the use of naval power and how to manouevre a mass force over strategic distance.

The fourth strategic lesson of Pearl Harbor is one perhaps that is only now becoming apparent. America’s grand strategy, and thus global stability, is dependent on two strategic partnerships both of which must be invested in and both of which require America’s partners to be as far-sighted as President Roosevelt. Europe remains America’s natural strategic partner, albeit one lost in a visionless parochialism. The other? Japan.

As an Englishman and a European I remember the sacrifice of brave Americans on a day that President Roosevelt rightly said will live in infamy.

Requiescat in Pace.

Julian Lindley-French

Is This June 1940 All Over Again?

Rome, Italy. 5 December. I am back in Rome, the eternal city, under new management facing a €30 billion austerity plan. Rome, that is, not me.

Niccolo Machiavelli, that great sixteenth century Florentine strategist once said that “...every type of government...should consider beforehand what adverse times may befall him and on what people it may have to rely in times of adversity, and should in its dealings with them act in a way in which it judges that it will be compelled to act should misfortune befall”. As €-Day approaches, 9 December, 2011, there is a lot of ‘befalling’ going on at present. Make no mistake, at this week’s Euro-Armageddon Summit a new power map of Europe will be drawn.

The failure of Europe’s institutions to cope with Euro-stress is leading to a power shift of historic proportions as a new/old balance of power re-asserts itself. It will be a Europe of a winner and losers, of ‘ins and outs’, of creditors and debtors. Even if enacted in the name of the European Union paradoxically forced integration could well mark the beginning of its end. Listening to some of the rhetoric flying around got me thinking; are we facing the economic equivalent of June 1940?

Germany is dominant (by default – no master plan), France subordinated, Britain isolated and puppet governments installed in both Greece and here in Italy. For a historian it all has a very familiar ring to it. There are some anomalies. Polish Foreign Minister Radek Sikorski has told Britain that, “we would prefer you in, but if you can’t join please allow us to forge ahead”. Minister Sikorski once accused me across a Washington table of being too pro-European. Politicians are always ‘pragmatists’ with principle. And, I really wonder if the Polish people identify as readily as He does with His ‘we’ and His ‘us’?

Of more consequence Chancellor Merkel has said rather ominously that “politics has failed” in Europe. Steady, Chancellor. And, President Sarkozy has called for a new EU treaty “re-founding and rethinking the organisation of Europe”. Meanwhile, out-manoeuvred British Prime Minister Cameron has said at one and the same time that a) if the greatest British-marginalising shift in European power politics since 1945 takes place outside a new treaty Britain is happy to acquiesce in its own demise (Churchill is spinning in his grave); whilst b) murmuring darkly that “Britain will defend its national interests” in the wake of last Friday’s failed Paris meeting with Sarkozy.

Two scenarios are likely to emerge from 9 December. Scenario one would see a new German-led core operating at the expense of Europe’s periphery. The forced German-led hybrid integration that Merkel favours will see all the European debtor nations forced to accept a fiscal straightjacket under Berlin’s direction with France and the Commission providing a fig-leaf of legitimacy. In time there will be no alternative but to create a European Finance Ministry. In the absence of effective Europe-wide political oversight democracy will be progressively eroded to the point where the only election that really matters concerns who gets elected in Berlin.

In such a scenario the British will stay out and no doubt fight – politically. Over time London would probably slowly get its act together and begin to build a counter-coalition around Europe’s periphery and beyond and reconstitute old strategic relationships in pursuit of a new strategic end – the containment of German influence. London and Berlin would thus once again find themselves strategic political adversaries.

Scenario two would see Berlin reach out not only to Britain and the EU peripherals but also to those in the wider European Economic Area (EEA) in pursuit of a new pan-European political and economic settlement. Germany would express grave concern about the legitimacy of the Eurozone and the implicit dangers to democracy therein if Berlin is seen to lead overtly for too long. Berlin might even suggest national parliamentarians replace Euro MPs in the European Parliament as part of a new European Constitution (yes, it will return). Euro-MPs are so far distant from the European peoples the X-Factor has more political legitimacy than they do.

Critical will be the relationship between London and Berlin because Germany understands that there are many Europeans within the Eurozone deeply disturbed by Germany’s power and Britain’s exclusion. If Berlin can do a deal with London then that will ensure the all-important strategic reassurance both Berlin and Europe needs to legitimise the profound change from which there is now no escape. Strategic reassurance would also be reinforced if Britain and France together strengthened their leadership of European defence. To that end, London needs to raise its strategically-illiterate, Treasury-driven eyes from the current account balance sheet and recognise that in its armed forces it possesses its one of two tools of critical strategic influence. The other being the City of London.

For Britain this moment is defining. After years of drift and spin the strategic incompetence of its political and bureaucratic elite has left London faced with the most awful set of choices since 1940 when all it could do was fight on at great cost or surrender. If the Eurozone integrates the British economy will escape mass destruction, but British influence in and over Europe will be non-existent and Britain will be reduced to a second-class European state and we British second class European citizens. If the Euro collapses Britain’s influence will be strengthened ,but only over an economically-devastated Europe.

So, is it time to dust of the Spitfires? Certainly, the crisis is leading to old reflexes as Europe’s post-war institutions fail under Euro-stress. And, as an Englishman there is something deep, beguiling and tempting about standing on the White Cliffs of Dover, shaking my fist and bellowing defiantly, “very well, alone then”. But such a fantasy must be resisted – that was then and this is now.

December 2011 is not June 1940 and we need to ensure it does not become so. No, whilst similar power relations can be implied by the shift that has taken place it is important to limit references to Europe’s destructive past. It is most certainly a power struggle but the use of power today is very different. What we need is legitimate and shared grand strategy, the effective organisation of huge means in pursuit of an urgent end. Sadly, what we will I fear get is grand tactics; badly organised and insufficient means leading to a disastrous end.

Therefore, we must all be vigilant but avoid the stereotypes of history that stress always provokes. Otherwise, we may in time be condemned to relive our history and I would not wish that on anyone. For as Machiavelli said, “...in the actions of men, when there is no court of appeal, one judges by the result”. Today, Machiavelli might have added the actions of women...one woman.

Julian Lindley-French

€-Day: Just How Broke Are We Europeans?

Oslo, Norway. 2 December. €-Day approacheth and with it the Onion’s day of reckoning. Norway is not in the EU and yet strangely there is no visible sign that civilisation is about to collapse. Quite the reverse! Indeed, it is nice to be in a country that works. Being a once vaguely red-haired Yorkshireman Viking blood courses of course through my veins. That explains a lot you say. Göll (battle cry), as we Vikings say.

Of course, being a small country (population 4.9 million) with large natural resources helps. Even accounting for depletion Norway controls some 54% of North Sea oil reserves and 45% of gas reserves. More importantly the Norwegians have used the oil and gas bonanza sensibly for when Oslo can no longer call upon nature’s bounty. This sits in stark contrast with much of the rest of Europe which prompted me to pose a rather serious question at this rather serious moment; just how broke are we Europeans?

Someone should ask the question. British Chancer Osborne has just delivered his Autumn Suicide Note and the finance ministers of the Onion’s No-Go Zone met this week to fail to inject a trillion mythical and not enough Euros into the equally mythical European Financial Stability Fund (EFSF). Therefore, your faithful blogonaut pillaged six well-known havens of the dismal economics science to bring you the answer. The six dens of iniquity are in order of self-importance Euro stat, the Economist, the UK Office for National Statistics, Nation Master, the CIA (which knows everything, but tends to forget when it matters) and the Organisation for Extremely Careful Digits (OECD).

Right, pay attention. Apparently we must first distinguish between a national debt and a budget deficit. Still with me? The national debt is the accumulation of all budget deficits since the Battle of Trafalgar, or maybe even before (was there ever a ‘before’ Trafalgar?). The budget deficit, on the other hand, is the shortfall (for that read massive, gaping black hole) between what income a European government generates over a single year and what it spends. To me both seem pretty bad but then again I am only a Viking.

Now, according to Norse legend it is precisely the interaction between debt and deficit that is so exercising the Dark Lords of the Market Universe who seem so determined to bring the halls of Valhalla crashing down. They do this by lending their ill-gotten gains to the very politicians (the Dark Lords (and Lady) of the Political Underworld) who caused this mess in the first place. It is the no-longer electable in pursuit of the utterly corruptible.

Being a tad miffed the Dark Lords are hiking the cost of ‘their’ money to remind our Dear Leaders that they will have to pay for at least one lunch in their lives. Trapped in the middle are the so-called ‘squeezed’, you and me, who have to service the interest on innumerable, clearly innumerate and quite probably inebriate free lunches by paying more tax, selling off the state that apparently we use to own to someone else or having our savings crushed by the rapacious banks that caused this almighty mess in the first place.

So, Great Hammer of Thor, here are the facts! Let me start with the Americans by way of Euro-comparison. Johnny Yank now has a budget deficit of some $15 trillion or €11.3 trillion which is some 10.7% the size of the US economy with a national debt of 65.2%... Believe me that is big. So, the Yanks are loud, proud and broke, but I suspect we have not heard the last of those people and if anyone seriously expects them to pay they will be nuked – pay-back for the Americans will mean Armageddon. Go ahead, make my day!

Then there is that mythical island long spoken about around Viking fires. The British budget deficit will peak at around 12% of the size of the economy in 2011-12 (Europe’s largest). However, there is some debate over the size of the national debt. The CIA puts it at 59% the size of the economy, the UK’s Office for National Statistics at around 61%, whereas Eurostat has it at some 76.5% (the Euro-Aristocracy could never count properly). This is due mainly to disagreement about how the British account for defence expenditure. However, as I am not aware the British are any longer spending money on defence I will stick to the lower estimate. Either way Britain is broke, weak and confused. Situation normal, all fudged up. Keep calm and carry on.

The great fortress of the Dark Lady Germany has a budget deficit some 5.3% the size of the economy and a national debt at 57.4%. For some reason this apparently means the Germans are rich. However, Berlin has decided that as the centennial of the sinking of the Titanic is fast approaching (April 2012) a re-enactment will then take place. Berlin will sink the good ship Euro with a new treaty. Germany will thus not be rich for long. Meanwhile, Europe’s other ‘leader’ France has a budget deficit some 8% the size of the economy and a national debt at 85%. France is not of course broke but suddenly will be after next May’s presidential elections. Then paying off of French debt will be then deemed by Paris to be Europe’s historic duty. Nous sommes tous Europeens maintenant, mais vous devez payer! Thankfully, we Vikings control Normandy.

The ‘best’ of the Onion’s rest speak for themselves. Belgium has a budget deficit at 5.6% and a national debt some 85.4% the size of the economy. At the very heart of the Onion Belgium now has an historic opportunity to make Europe an image of itself; utterly broke, utterly divided with no effective government and doomed to fall apart unless by some miracle it can persuade all other EU states to scrap themselves and create a federal Europe. I suppose it is the time of seasonal good will and we are approaching Christmas and there are certainly enough turkeys around these days to vote for their own demise. Ireland meanwhile has a budget deficit of 12.2% with a national debt of 38%, which is an awful lot of Guinness. Dublin is thus broke but thankfully has a time-honoured alibi; blame the British.

And what about Club Med? Spain has a budget deficit of 8.5% and a national debt of 41.6% - good at football and tennis, sadly not so good at economics. Portugal has a budget deficit of 7.6% with a national debt of 62.6% with absolutely no means to pay it back. Hasta la vista, baby, or whatever the Portuguese equivalent. Meanwhile, Italy has a budget deficit of 5.4% but a national debt of 100.8% (one set of figures has it as high as 120%). Chaos reigns in a very broke Rome – so it is business as usual then. Meanwhile, the poor old Greeks will bear no gifts for many a Trojan moon. Athens faces a budget deficit of 9.8% and a national debt some 94.6% the size of the economy.

Norway? The Norwegians have a budget surplus (yes a surplus) some 11% the size of the economy. And even though Oslo has a national debt some 60% the size of the economy it also has the world’s largest sovereign wealth fund.

So, just how broke are we Europeans?  Well and truly muggered! So, either Norway offers a fellow Viking asylum, or I invade.

Just call me Sven!

Julian Lindley-French

Does Germany Really Want to Save the Euro?

Vienna, Austria. 28 November. Does Germany really want to save the Euro? The great Austrian strategist Count Metternich once famously said that when Paris sneezes, Europe catches cold. Today, he would probably substitute Berlin for Paris.

I have just spent the weekend with close German friends in beautiful Vienna. The sense of pending doom was everywhere. Much of the blame for this was placed on the very narrow legalistic approach Chancellor Merkel has adopted in this crisis. Her focus on a ‘new treaty outside the treaty’ is seen as the financial equivalent of discussing patio design as the house burns.

The Euro may be beginning the death-dive from which it is unlikely to recover. The costs of Italian borrowing reached record highs last week, Belgian and Hungarian national debt was reduced to junk status and even a bond auction for mighty Germany flopped. And yet Berlin continues to insist on disaster-defying ‘red-lines’ that seemingly have little or nothing to do with the danger of the moment.

Vienna knows a thing or two about death dives. In the nineteenth century the death-dive of the Austro-Hungarian Empire led to the ‘shot that rang round the world’. By trying to hold onto a swathe of the Balkans its final dying act led indirectly to World War One.  It was the mother of all unintended consequences that swept the ruling Hapsburgs away. A relatively minor shock brought the whole rickety edifice crashing down. Just like the Euro today. In fact it was a miracle Austria-Hungary endured as long as it did. This was due to a mixture of luck, geopolitical convenience and a few able leaders and statesmen such as Count Metternich. Absent of any of the above and the empire’s fate was sealed.

However well-meaning Chancellor Merkel may be, ‘able’ is not a word I would associate with her leadership thus far of what is fast becoming an existential European crisis. The French and Germans last week failed to agree a common strategy and thus failed to reassure the markets. In a clear sign of the times my sources within the European Commission tell me the minor ‘nobility’ of the Euro-Aristocracy who work therein have been told to say nothing that might harm the Euro, whilst being encouraged to consider how best they might protect their own savings. Nice people. Of course, the rest of we Europeans are being left to the dogs. That is what aristocracies do at times of crisis – look after their own. It is the Brussels Onion at its very worst, and there are some who actually want these people to run our lives.

The thing about crises is that the choices they generate are never comfortable.  I found last week’s picture of ‘Merkozy’ instructing Mario Monti, their new man in Rome, quite nauseating. Naked German and French power and electoral politics are clearly at play behind the pretence of Berlin and Paris to be speaking for Europe. As a Briton I also find it galling that the world’s fifth or sixth largest economy has been deemed by the disaster-defying duo simply not to exist. Although much of the blame for that I lay at the door of PR-Meister Cameron who has been ‘outed’ by this crisis as a very little leader of an increasingly irrelevant country. Above all, as a Dutch taxpayer, I find it particularly distasteful that two so narrowly-motivated foreign politicians are deciding the future fate of my hard-earned money.

That said someone has to act. The stakes are now simply too high. Debt defaults, bank failures, single-market destroying currency swings are just around the corner, maybe even widespread social unrest. Indeed, if the investors who have hitherto provided the bridge between what EU member-states can afford and what they spend really take fright the EU itself could be in danger. And yet Chancellor Merkel seems strangely immune to the immediate, the need to reassure the Dark Lords of the Market Universe and fight the fire which is threatening to engulf us. We get lots of strong posturing (finger-pointing, stern faces etc.) but little by way of strong leadership.

Maybe Berlin has made a secret choice; Germany would prefer the Euro in its current form to collapse, the unreformable southern Europeans to be pushed out and the currency rebuilt around a northern, western European core. Maybe it could even include the British. Now there’s a thought.  Did Cameron and Merkozy do a deal?

Certainly, Berlin's behaviour means the very real prospect now looms that the whole rickety Euro edifice will come crashing down. Just like Austria-Hungary. If Berlin does indeed have a Plan B it should perhaps consider one other truism of legalism; the law of unintended consequences. Vienna learnt that the hard way.

Nice patio, Chancellor. Shame about the house.

Julian Lindley-French

Dead Politics: Europe's Enemy Within

Alphen, the Netherlands. 21 November. One of the great doyens of nineteenth century British foreign policy Lord Salisbury could turn a phrase or two. Speaking of Britain in the 1870s he may well of been speaking of Europe (and the British bit of it) today when he said “…the commonest error in politics lies in sticking to the carcases of dead politics…we cling to the shreds of an old policy after it has been torn to pieces, and to the shadow of a shred after the rag itself has been torn away”.

The Banquoesque ghost of Lord Salisbury stalked Chancellor Merkel and Prime Minister Cameron in their 18 November Berlin talks. They talked of “decisive action” and of “working together”. Far from the making of strategy the talks were in reality about the mutual covering of domestic political rear-ends. My sources tell me a deal was done by which Cameron would accept some change to the Lisbon Treaty in Germany’s favour in return for a relaxation for Britain of what is known as the Working Time Directive. Berlin has thus provided London with a political fig-leaf to cover yet another British retreat. Berlin was thus non-business as usual, Euro-inertia at its very worst. More toy bazooka than big bazooka. Indeed, given the scale and nature of the struggle with the Dark Lords of the Market Universe, the meeting was little more than the strategic equivalent of re-arranging deckchairs on the Titanic. Britain out, Germany up, Europe nowhere.

On Friday night I attended the annual dinner of the Oxford and Cambridge Society of the Netherlands and I saw yet again the strategy-free malaise at the heart of the Euro-Aristocracy. The speaker was a senior British-born judge at the European Court of Justice. After making the usual sad ‘it’s all Britain’s fault’ apologia to impress his Continental friends he suggested that had Britain joined the Euro a) the project would have been strengthened (perhaps); and b) that Club Med would have found it far harder to have broken the rules (no way). My Continental colleagues of course gratefully accepted his offer of British guilt; pass the buck is one of Europe’s less endearing qualities. The white flag of surrender had been raised for the price of a free dinner.

However, his remarks did for me raise two fundamental questions. How do we break out of the Euro-inertia and dead politics that are killing effective crisis management? What would it take to get all EU member-states working together towards something like a credible solution? Now, I am neither an economist nor a politician, which is probably just as well given the mess that has been created by the marriage of dismal science and dismal appliance. What I am is an historian and strategist; I understand failure and thus the need for a change of plan. Put simply, we need to shift the centre of gravity of this crisis from the Euro to the single market and how to make it work better.

Plan B for Europe would have three basic elements: First, a new crisis leadership group is needed to foster fiscal discipline, political unity of purpose and leadership legitimacy. Chancellor Merkel should have insisted that in this existential crisis confronting all twenty-seven EU members it is vital London joins Berlin and Paris.  It would be leadership overseen by a new Special EU Council of Ministers to replace the proposed Eurozone organiscramble that came out of the 26 October summit. For too many years France and Germany have actively excluded Britain from their EU leadership tryst. For too long the British have pretended that what happens on the Continent has ‘nuffing to do with us, guv’.

Second, the creation of a bad sovereign debt bank would buy time for the debt recovery and thus give all-important growth a chance. 50% of all Club Med debt would be placed in this off-shoot of the European Central Bank to be guaranteed by the northern and western European taxpayer and overseen by the new Special Council of Ministers. The International Monetary Fund (IMF) would also guarantee this bad debt bank.  The new bank would probably also have to include some Belgian, Irish and dare I say French and British debt and must thus be seen as a long-term structural change to the Union, requiring an amendment to the Treaty on European Union to which London should agree.

Third, strict new rules for all Euro members aqre needed allied to a mechanism for the suspension of any member-state that breaks them from either the Euro and/or the single market. The creation of technocratic governments in Greece and Italy whilst expedient must be seen as mere stepping stones to a democratic future committed to sound financial governance. Technocracy is an alluring danger in Europe. What matters is that democratic governments better adhere to rules and thus avoid a repetition of this disaster. That means meaningful and credible compliance across all twenty-seven EU members.

As an Englishman who pays his taxes to the Dutch state I am willing to make the necessary sacrifice for the common good. However, before I do so I need to be convinced that my money will be used to work a sound plan of action and not simply despatched down yet another profligate black rhetorical void beloved of the self-serving Euro-Aristocracy.  Critically, Plan B could see Britain stay in the EU.  The alternative is that  London permanently accepts second-class status within the EU, even as it remains the second highest net contributor.  Neither the French nor Germans would ever countenance such injustice.  Millions of my fellow Britons would bring down a British government rather than accept that...and I would be amongst their fold.   

Cameron and Merkel missed a trick in Berlin. What is needed is real, radical and concerted action. What we got is more dead politics.

Julian Lindley-French

Playing the Race Card

Alphen, the Netherlands. 17 November. Racism exists. Racism is wrong. It must be confronted and eradicated. However, dealing with racism should not be at the expense of fundamental civil liberties or freedom of speech. That is what is happening in Britain as hitherto irritating political correctness tips over into something much more sinister. There was once a time when English law distinguished the criminal from the stupid. No more it would appear.

This week alone a series of media frenzies on race illustrate just how out of balance the British elite have become on this subject (the media ‘luvvies’ in the BBC are forever lecturing the country about racism and it is utterly nauseating). The England football captain John Terry is under criminal investigation (yes, a criminal investigation) for an alleged racist remark made during a football match against Anton Ferdinand, even though Mr Ferdinand himself did not bring any charge. Yesterday, the Football Association brought charges against Luiz Suarez of Liverpool for an alleged racist slur against Manchester United’s Patrice Evra. At the other end of the spectrum Sepp Blatter, the Silvio Berlusconi of FIFA, suggested there was no problem at all with racism in football when clearly there is. And, much more seriously two men are on trial in London for their alleged part in the racist murder of Stephen Lawrence, a young black man back in 1993.

Racism clearly is a problem in Britain. However, seen from the Dutch side of the North Sea the obsession of the British elite with racism seems unbalanced and dangerous. The Dutch take a much more common sense approach to it and whatever the insinuations of right-winger Geert Wilders, Dutch society seems far more balanced in the way it deals with racism. The tragedy for me as an Englishman is that the tipping of political correctness into legal repression will not make British society any happier. Indeed, attempts to use the law to mask a failure of policy will simply drive racism underground. And, in some respects reinforce the sense amongst the decent but squeezed middle that they are now part of an oppressed majority in which their legitimate concerns about mass immigration and the failure of government to deal with it is somehow racist. I travel regularly to Britain and each time I hear basically the same message; political correctness is getting worse, minorities are being favoured at the expense of the majority, freedom of speech is being crushed by draconian laws.

Now, I write this as someone who has been at the sharp and wrong end of prejudice and discrimination. I know what it feels like and, believe me, my life today is still blighted by it. However, a fairer society will not be achieved by trying to legislate racism away. Racism is driven by fear and at this time of acute economic stress the resort to law is simply another example of a failure by the political class across the political spectrum to serve the interests of the people of Britain as a whole, irrespective of colour and/or creed.

The Left experimented with mass immigration on the British people in pursuit of a multicultural fantasy. All they did was to create yet more ghettos. The Right experiments with notions of economic liberalism to drive down employment costs whatever the human cost. Meanwhile the so-called UK Border Force is in the headlines for suspending passport checks and thus failing to properly control immigration. The result? Britain is fast becoming a country divided utterly against itself.

There is no silver bullet for racism. The only way for government to address racism is to establish a bipartisan, long-term policy that progressively removes the fear and mistrust that is driving it. First, properly re-establish border controls based on an immigration policy that is seen to work. This government is failing that test badly. Second, move away from the multiculturalism which has exacerbated the problem towards a long-term process of integration. That will mean on occasions confronting some practices which challenge the very foundations of Britain’s legal philosophy and culture, such as the informal use of Sharia Law and forced marriage. They have no place in Britain and cannot be justified on the basis of culture. The role of education has a critical role to play. Third, when racism is openly stated with a clear intent to incite race hatred and violence then and only then apply the full force of the law.

Above all, re-establish the faith of the majority that there is some semblance of balance.  The playing of the race card is ever more evident. Last night I happened to be watching a programme on a Dutch TV channel about policing in my home town Sheffield. A policeman stopped a car because its driver was uninsured. The driver was an African immigrant who immediately produced a newspaper that alleged police racism as a defence. Thankfully, the police officer was himself black and was having none of it but too often the mere suggestion of racism is enough to deter the authorities. This simply leaves the majority angry and bitter stoking racism where it may not otherwise exist.

I am no nostalgist. I have no sense that the past was somehow better. All I want is for British society to function on the basis of mutual respect and tolerance. That is not happening. And, until the British elite restore some balance to how they deal with racism it will only get worse.

Julian Lindley-French

Dear Mr Kauder, A Polite British Word of Advice - in English

Alphen, the Netherlands.  16 November, 2011

Dear Mr Kauder,

I read with interest your disrespectful public comments about Britain at the CDU conference yesterday. I particularly enjoyed your line about preventing we British from 'getting way' with our opposition to the proposed German politicians rescue plan, sorry, the financial transaction tax.  For the record I of course respect both you and modern Germany and I understand this to be a difficult moment.  However, with 400 dead British soldiers in Afghanistan and over 2000 grievously wounded, a lot of them because Germany was not prepared to pull its weight therein, lecturing we British about 'solidarity' is what we would call a bit rich.

Quite simply we British have been doing too much of the dying for Europe these ten years past for a mission in which we were all meant to be equals. Clearly, solidarity in the German you now claim Europe speaks only extends to your selfish pursuit of money, not the dangerous bits for which you seemingly expect we Britons to pay the ultimate price in great numbers.  And now you wish to further damage our fragile economy to save you from a folly we warned you about many years ago. That is precisely why we did not join the Euro. It is called sovereign choice.

Your cheek seemingly knows no bounds because not only do you want our money, but to exclude us from your nice little leadership pact with France that challenges European democracy to its core. I think in America they call that taxation without representation and they recently got rather annoyed about that.

Now, I am more than prepared to do my bit for Europe and as a Dutch taxpayer I know I will have to pay, but in return I expect your country's leadership to get its act together and face facts; the German taxpayer is also going to have to pay.  So, no more of this ridiculous anti-British rubbish simply to mask your own country's incompetence.  Let us stay focused on the economics of the matter and then we might find a way forward together.

Attacking we British in such an egregiously unfair way when Germany has shown so little solidarity with my country or respect for it over so many years will only make us fight back and you will pay a price for that. Surely, you Germans have learned by now never to under-estimate we British. Treat my country with respect and you might get a respectful answer; treat us with contempt and we will show you what contempt means - in English.

If you wish to properly understand the situation you might wish to consult three of my recent blogs which have been published on leading European and American web-sites: No Taxation Without Representation; Solidarity: The Emptiest Word in Eurospeak; and my most recent, A German Europe or a European Germany?

You may learn something...maybe even just a bit of respect.

Yours respectfully,

Julian Lindley-French,

The Strategic Influence Game 5: A German Europe or a European Germany?

“I have always found the word “Europe” in the mouths of those politicians who wanted from other powers something they did not dare demand in their own name”.

Otto von Bismarck, German Chancellor, 1871-1890

Alphen, the Netherlands, 15 November. Germany has never found the leadership of Europe easy to attain or to execute. And yet Germany today finds itself the unrivalled leader of the European Union. Can Germany for once get leadership right?

Only at the very 1871 beginning of modern Germany’s uneasy existence was Berlin led by a man who grasped both the possibilities and dangers of German power. The very creation of the then German Empire rocked the rickety European balance of power to its core. And yet somehow Iron Chancellor Otto von Bismarck steered Germany (relatively) peacefully through a minefield of competing European interests. With his dismissal in 1890 by an unbalanced Kaiser Wilhelm II Germany and Europe began the long slide towards the twin and linked catastrophes of World Wars One and Two.

Today Germany is back. It would be easy to think that the ‘sudden’ emergence of Germany as Europe’s natural leader is a consequence of the Eurozone disaster. In fact Germany has been slowly recovering its position at the centre of European power politics since 1945. And yes power politics still exist in Europe even if masked by the political correctness of Euro-speak. The Eurozone Summit Statement of 26 October simply made German leadership official.

The facts speak for themselves. The 2011 German economy at $3.3 trillion or €2.5 trillion is at least 30% bigger than that of either France or Britain and thanks to reforms in the mid-naughties structurally far more efficient than either. At 81,729,000 the educated German population is again 30% bigger than the two other members of the EU’s so-called ‘Big Three’. Critically, Germany is the world’s second largest exporter with exports accounting for some 33% of national output. For all the current German angst the Euro has been the great German wealth creator. Indeed, Germany’s 2011 trade surplus stands at $20.7 billion or €15.2 billion, some 66% of that exports to its indebted Eurozone partners. Quite simply, the Euro has offset the high cost of German production and created a customs union (Zollverein) for German exports, which was Germany’s 1914 war aim.

So, the EU has done for Germany what two disastrous wars could not, cement Germany as the natural leader of Europe and by extension supplant Britain as the natural European strategic partner of the United States. But here’s the rub; just when Europe needs decisive German leadership Berlin is unable to deliver. Indeed, having gained the power and influence that her political forebears dreamed of not-so-Iron Chancellor Merkel is probably incapable of exercising it either for the good of Germany or Europe.

First, the German Constitution is a direct descendent of the 1948 settlement imposed by the victorious allies upon a defeated Germany. Its very purpose is to prevent the concentration of power in one set of political hands in one Berlin place at any one time. Consequently, Chancellor Merkel possesses nothing like the domestic political authority of either President Sarkozy or Prime Minister Cameron.

Second, the current generation of German leaders are the heirs of a political culture that was so successfully ‘de-nazified’ they still find the concept of German leadership at worst abhorrent or at best uneasy. The whole point of German power is not to have strategic influence, especially of the ‘nasty’ military variety and especially over other Europeans. Germany will thus endeavour to ‘rule’ through the European Commission.

Third, having gained more from the Euro than any other EU member-state the German people are not at all interested in paying to rescue it, demonstrating the limits to their (and Germany’s) ‘Europeanness’. This explains Chancellor Merkel’s reluctance to let the European Central Bank act as the lender of last resort to the Euro-rule-breaking southern Europeans. It also explains her efforts to get countries that have far poorer GDPs per capita to pay for the still-born European Financial Stability Facility.

Equally, there are signs that Germany is slowly re-learning the art of Realpolitik. The opening of the Nordstream gas pipeline last week suggests a new strategic energy relationship with Russia which will concern Central and Eastern European states. The democracy-defying Franco-German presumption of Eurozone leadership suggests that Berlin might be overcoming some of its power reticence. And, the implicit anti-Britishness that has long been a factor in German foreign and security policy has been evidenced by the effective exclusion of the EU member-states with Europe’s strongest financial market from Franco-German leadership of this first order European crisis.

Consequently, Berlin and London are now on collision course.  On 14 November both Chancellor Merkel and Prime Minister Cameron made speeches calling for fundamental reform of the EU.  However, whilst Merkel called for "...not less Europe, but more" and an overhaul of EU treaties to force fiscal union, Prime Minister Cameron called for the aviodance of "grand plans and utopian visions" and saw the future of the Union as having the "...flexibility of a network, not the rigidity of a bloc".  They meet soon; that should prove interesting. 

For all that history is only so eloquent when considering Germany and Germany’s place in Europe. Berlin’s leadership must therefore be given the benefit of the doubt so long as there is any doubt left about how Germany intends to exercise strategic influence. Germany is no longer ruled by the Kaiser or Hitler and the wars are now but distant memories. Germany is a model European democracy and shows no signs of wavering from a path set for it by the victorious allies.

But the question remains; a German Europe or a European Germany? Berlin will need to work hard to convince ALL Europeans that it knows the politically-correct answer to that most seminal of strategic questions, whatever the temptations for domination afforded by the Eurozone crisis, whatever the democracy-destroying expediency of the moment.

Julian Lindley-French