Rising from rags to riches in Europe

First, a confession: every week, it's hard to resist the temptation of commenting "The Economist" on EU issues. But this week I do.

The chance of social upward-mobility is exceptionally bigger in Europe than in the US, the Economist reports.

"Aroud three-quarters of sons born into the poorest fith of the population in Nordic countries in the late 1950s had moved out of that category by the time they were in their early 40s. In contrast, only just over half of american men born at the bottom later moved up." - "The Nordic countries are distinctive in one further way: (...) Nordic countries have almost completely snapped the link between the earnings of parents and children at and near the bottom. That is not at all true of America."

"The obvious explanation for greater mobility in the Nordic countries os theiir tax and welfare systems. (...) The other part of the explanation seems to be their superior education system." (The Economist, 5/27/2006)

The Economist seems almost surprised of the fact that a deregulated economy like the US provides much lesser chances of upward-mobility.

Finally, it seems, the message is starting to get through. A fair welfare system does not hinder economic growth (as the Nordic countries prove in every statistics), but connected with a well-financed and progressive educational system it's simply unbeatable. Rising from rags to riches seems to be not the American but the European way of life.

It's about time to implement this lesson in Continental Europe and in Brussels.

Here are the links to the respective studies the Economist quotes:
"Non-linearities in Inter-generational Earnings Mobility"
"American Exceptionalism in a New Light"

How the Conservatives just dumped the Constitution. And what this means.

The EU foreign ministers have agreed on a roadmap for institutional reform, as Dutch foreign minister Bernard Bot told reporters (EU Observer 5/27/06).

The foreign ministers have obviously found a compromise only on the basic question of institutional adaptions needed for small-scale enlargement, but not more.

The Consequences
This strenghtens the assumption of my recent piece on this issue on the same issue: 1) no big enlargement step after Romania, Bulgaria and Croatia. This will especially mean a "no" for the Turkey accession by the Conservatives. 2) No further institutional or political integration. This means especially a "no" to policies related to a "Social Europe". 3) The minimum version will probably be stripped of most symbolic "constitutional" elements.

Why this shouldn't make the Left happy
As I have indicated earlier, this is not a bad trade-off for the Conservative governments. But the Liberals and the Left should become cautious: a "no" to the Turkey enlargement is a threat to EU foreign policy as we knew it, and this means a threat to the influence of stability, democracy and peace the enlarging Union had. If the Union starts to close itself off from the neighboring regions (following the US example) this could mean that the already 50-year old growth of peace may come to a hold.

Also, to pursuit a "social Europe", further integration in democratic, social, economic and judicial matters and changes in the budgetary and monetary policies is needed.

The end of the Constitution therefor is nothing that the Left needs to be particularly happy with.

How German Reforms fuck up Europe (and Germany, too)

This is a response to beatroot, who commented on my recent piece on the constitution : "I doubt that liberalisation is on many agendas at the moment. (...)Even Merkel has gone quiet on those much needed German reforms."

Believe it or not: Germany most competitive and profitable big country of Euro.
Evidence strongly suggests that the mantra "Germany needs reform" has already become true long time ago. Germany is again the biggest exporter of the world, and the German companies are profitable beyond historic precedent. The competitiveness of an economy is measured in unit labor costs. They get cheaper when productivity outgrows labor costs. That is what has happened in Germany. In fact, Germany's unit labor costs have remained at the same level since 1995, whereas eg Spain's have risen about 30%.

German reforms itself and fucks up European economies
The reason is an already decade-long restraint in wage increases in Germany. In fact, wage restraint has made Germany so competitive that it damages the other economies of the Euro-zone, as a study of the Paris institute OFCE suggests. Economist Robert von Heusinger argues in Die Zeit that Spain, France and Italy would have to outbalance Germany's reforms with long years of wage restraint and social cuts of their own or - leave the Euro-zone.

Profit doesn't mean growth
So, why is there still so little growth in Germany although the exports roar and the companies are profitable like hell? The answer is that with all social cuts and wage restraints the domestic demand - usually creating the biggest share of growth - could not grow.

So, the message of the economists is out (and some European national parties are finally responding): liberalization per se does not fix anything. At the moment, misguided liberalization policies are mainly responsible for the lack of growth in the Euro-zone.

German labor reforms more expensive and less effective than old system. But unemployed people are punished nontheless.
Talking about misguided liberalization policies: "Hartz IV", the German labor market reform is now proven that it not only pushed part-time workers and folks without job beyond the poverty line, but also costs more than the old system and is less effective in putting people in jobs, according to the German Court of Audit. (Sueddeutsche, 5/22/06)

Left Euroblogs, where are thou?

I've spent quite some now looking for other blogs commenting on the EU from a left point of view. I'll put them in my blogroll sometime soon, but the results have been pretty disappointing so far. That's particularly troublesome as the Conservatives and the Right euro-critics (mainly British) are already well-positioned in the blogging world. Meanwhile, here's one of the nicer exceptions: European Tribune, a Dailykos-style blog (some of the contributors will be familiar to those reading Dailykos).

CIA sources prove European goverments' involvement in torture scandal, Parliament says

The Parliamentary Commitee investigating in the CIA scandal on torture and extraordinary rendition reported that CIA sources support the allegations the various EU governments have been involved. Parliamentarians (MEP) are currently in the US for investigations on the CIA scancal.

At least 30-50 people have been illegally transported by the CIA, Italian MEP Claudio Fava said. At least 7 torture and detention sites ("black sites") have been operated by the CIA in foreign countries, among them some in Europe, according to Fava. (EU Observer, 5/17/06)

An interim report presented by the Commitee last month concludes that the CIA operated at least 1.000 flights over Europe carrying illegally abducted and detained persons.

Cooperation by EU governments has been insufficient so far, with few top-officials willing to give testimony.

The involvement of EU-governments in the illegal CIA activities is shocking. But how countries like the UK, Germany, Poland and Italy and even the highest EU officials (like Javier Solana) try to obstruct the EP investigation, thats a true scandal of its own.

Morales on Nationalizations in EU Parliament | Financial Retaliation against Bolivia?

Evo Morales defended the nationalization of Bolivia's gas reserves at the European Parliament yesterday. Morales: “I understand that your companies need a return on their investments, but you cannot own the resources – the state will control them. Companies will be our partners but not owners of natural resources. I regret that some parts of the media trying to create confrontation.” (EP)

Financial Retaliation against Bolivia?
Before the LAC/EU summit this weekend, Morales accused the Spanish government of reneging on the promises made during last year's election campaign of doubling aid funds and debt relief. The Spanish foreign minister Miguel Ángel Moratinos responded that Spain would keep its promise but that it would take time. (El Pais, 5/11/2006)

Negotiations between the Spanish and the Bolivian government on the legal handling of the nationalizations concerning the Spanish-Argentinian company Repsol-YPF started two weeks ago. During the summit in Vienna Zapatero emphasized that he aims at keeping the bilateral relation amicable. This is positive in comparison to his initial comments in March.

Repsol-YPF has threatened to reconsider its investments in Bolivia. It faces a class-action lawsuit of stakeholders in the US in connection with the changed political situation in Bolivia. Some major finance groups have already handed over the shares of those companies that are to be nationalized. (El Pais, 5/16/2006)

Despite some consiliatory words from the Spanish government and Brazil's Lula it remains to be seen if the involved governments and companies or the usual international supects will put on the financial thumbscrews on Bolivia in order to force Morales into submission.

Latin America, Europe and the Left: Enthusiasm and the Challenge ahead

Hugo Chavez and Evo Morales were the unchallenged stars of the Latin-American/Carribean States (LAC) summit in Vienna this weekend. The European Left was successful in shifting the focus on the Union’s aggressive international trade policy and may well have created one of the first truly European focal points for the Left. The revolutio-romantizism of the alternative summit reveals, on the other hand, the challenges of the Left that still lie ahead.

1. The Left finds its first European objective, finally
As a driving force of a neoliberal international trade politics the EU is playing side by side with the USA, as many NGOs like Attac or Oxfam have argued in recent years. (Also see my piece on WTO-EU). In some cases the Union has in fact taken over the role as the main villain, for example in the Hong Kong WTO Doha round in December 2005. The vision of the EU being or becoming a “soft world power” can, therefor, already be discarded as phantastic or simply wrong.

This weekends major effort of an alternative summit paralleling the LAC-EU meeting has finally succeeded in creating a public focus on the Union’s aggressive trade policy. But there’s more to it: it could well be the first left issue that truly gets a grip on European politics and be a focal point for the whole left spectrum (from unions to greens) and pan-European. It’s concrete, visionary, long-term and not too reactionistic.

One example: the tribunal-technique of publicly accusing specific big companies for their unethical business strategy has been used at the Alternative summit for companies like Suez. It has proven successful in a variety of (mainly American) campaigns (Killer-Coke, Nike Anti-Sweatshop, etc) and can prove interesting for unions, student groups and consumer-advocates.

2. Lessons learned from older European campaigns
There have been, of course, some recent examples of more or less successful European Left campaigns: Anti-GATS, Anti-Bolkestein and Anti-Constitution, to name the most important. But all of them have had their flaws: GATS was very technical and couldn’t reach wide publicity despite the involvement of some major labor unions. The Anti-Constitution campaign could, after all, not find a concrete Left critique of the Constitution that would have been able to unite the Left of both the old and the new member states (not mentioning the rift in eg the French Left itself) and instead relied on a blurry Anti-feeling that some Eastern European commentators have dismissed as coded xenophobia (and, to some extent, rightly so). All of the mentioned campaigns have in common that they were only a defensive reaction to a (hostile) policy.

The issue of the Union’s trade policy, on the other hand, has the potential to overcome those childhood-illnesses of European left campaigning. It is to hope that a similar development will take place for other pressing issues (Social Europe, civil rights and security, etc.)

The three keys to a successful European campaign could be described as follows: 1. Concentrate on specific policies instead on “neoliberalism” as such. 2. A successful European campaign needs to include and be attractive for the whole European Left (and not only the Western European Left). 3. A concrete policy we favor over the policy we fight.

3. Solidarity with Latin America? How?
The current left-swing in Latin America has been described as probably one of the most important left developments of today. This may well be true for Latin America, and I deem it important to sustain a feeling of solidarity towards the Left movements. After all, it isn’t too long ago that the US supported a putsch against the elected president Chavez. A conscious European public is important as a counterweight to another similar attempt.

4. The erratic First-World Left
On the other hand, the first-world Left is an erratic and moody bitch. Before the current Chavez/Morales hype there was a similar Lula-hype, but after his corruption scandal he fell from grace with the first-world Left and is now seen as something like a Latin-American Tony Blair.

The first-world left is keeping a deep sympathy for anything that smells like Che Guevara, Latin America or popular uprising (and there’s nothing wrong with that).

But here’s the problematic part: the socio-romantic semi-knowledge of what’s going on in Latin America is sometimes deeply unrealistic, as the case of Lula shows: could we really expect an instant overturn of a deeply rooted parlamentary system of corrution? Or have the high expectations rather been proved naïve and unrealistic? Now, parts of the first-world Left apply a similar black-n-white scheme on Venezuela and Bolivia.

I say that there’s a 50:50 chance that the Lula-destiny awaits Chavez, too, and that the first-world Left will find find yet another new hero to first love and then loathe. The reason for this is that Left aocio-romanticism is, I claim, still structurally racist (reminding of Edward Said’s analysis of Orientalism). As Lord Byron was disappointed that the Greek revolutionaries weren’t as pittoresque as the antique statues he knew, we are bound to find out again and again that the Latin American Left is as much trapped in the context of their system as we are by ours.

5. Working along with Chavez and Morales
This doesn’t mean that we shouldn’t be responsive to the developments in Latin America. The alert solidarity mentioned above is certainly needed and useful. But the true lesson learned from Chavez and Morales is about applying their critizism of the economically imperialist West in our European policies. This means change in the CAP (Common Agricultural Policy), democratization of the foreign trade policy (possibly handing over the real responsibility and oversight from the Commission to the European Parliament), investment in alternative energy, and democratic supervision and possibly nationalization of water/gas/power/petrol companies. That sounds like a lot of boring and not-at-all-revolutionary-feeling work. True. But that’s what solidarity with the Left movements in Latin America is really about.

Why the Conservatives will dump the Constitution

After the self-imposed “year of reflection” the European governments are once again buzzing with ideas how it should go on with the Constitution. Despite some differences in the tactics, the conservative strategy for Europe is now becoming clear: most probably no Constitution for now. But most of its content will come anyway.

The five conservative heavyweights – Barroso, Schuessel, Chirac, Merkel and Kaczynski – have proposed different ideas of how to – or not to – pursue with the Constitution. Whereas Schuessel and initially Merkel want to give the Constitution a second try, Barroso and Merkel recently favored continued reform on a low level without reviving the Constitution for now. Chirac prefers “cherry-picking” those propositions that do not need a referendum. The Polish President Lech Kaczynski wants to rewrite the Constitution with a less integrationist approach.

Behind those disaccords, the Conservative leaders share a common idea of how the next couple of years in the Union should look like:

1) Enlargement’s over
Integration (symbolized by the Constitution) and Enlargement are seen as the two biggest turn-offs for the European population. Key of the new strategy is to upset the Europeans as little as possible. So, Merkel, the French government and the European Parliament (EP) have made it clear that they want an enlargement stop for now. It's likely that after Bulgaria, Romania and Croatia they plan to make a (very) long break. Merkel, like Sarkozy and Schuessel, have expressed their doubts about a full membership for Turkey.

2) Cherry-picking
The Commission’s recent proposal to use a bridging-clause to transfer of large numbers of police and criminal matters from the third pillar (unanimous vote) to the first pillar (majority vote) resembles the relevant clause from the Constitution. It seems that the cherry-picking, proposed by Chirac, has begun. This means the implementation of parts of the Constitution through the back door.

3) Focus on further liberalization and security-related issues
A partial stop of integration is nothing the Conservatives are particularly afraid of. Contrary, for the conservative leaders (like Kaczynski) a deepening of the Union (especially in social matters or taxation) is a frightening perspective. Without a Constitution further integration in those areas will be posponed for years. Further liberalization, on the other hand, is easily possible in the current treaty structure. Security-related and criminal matters can, as proposed, be transferred into the first pillar that doesn’t require unanimous vote.

This turn from last year’s grand-project-approach of the Constitution to a comfortingly slow, but consistent pursuit of neoliberal policies finds its expression in the Commission’s paper “A Citizen’s Agenda”, published today. “The clear message we receive,” the paper says, “is that citizens want a Europe of results. A Europe that delivers for them.”

The British are likely to play along, especially as the Labour government is weakened and will not invest political capital in pushing an unpopular Constitution. And Britain has never been overenthusiastic about the Constitution anyway. This means Europe's big four: France, Germany, Poland and the UK will most likely not further push the Constitution. This could mean posponing and probably changing the Constitution - or a long kiss goodbye into oblivion.

The only real woe of the Conservatives is that without the Constitution further integration of a common foreign and military policy will have to wait. But, it seems, that’s something the Conservatives can live with for now.

Plan D

Now that I call creative: to mobilize against the current effort to revive the Constitution, ID (Independence/Democracy Group), one of the European Parliament's groups organizes a ... bus tour through Europe. The Italian Lega Nord, the Polish League of Families and the British Independence Party are members of ID. The bus tour shall promote it's campaign against the Constitution. (Plan D campaign website). "Plan D", initially that was a Commission diction: "Plan D for Democracy, Dialogue and Debate”. ID, meanwhile, assumes it stands for "dead", referring to the Constitution. Yawn, rightists. Without all the bus-tours pro and contra the Constitution that have taken place in the last 2 years, we probably could have reached our Kyoto-goals for Carbonmonoxide.

Football's coming home

The Parliament held a hearing on "Professional Football" last week. Football, the Parliament concludes, "offers a model for social integration". That's a damn charming perspective. Thinking about who is now the Austrian champion I think it's far-fetched, but charming nontheless (EU Parliament).

War on Iran II: The case of Iraq

In the first piece of this series I argued that by taking over major responsibilities in Afghanistan, Europe is easening the overall burden of war of the United States. My argument in this text is that – contrary to the common view – Europe has played a major role supporting the Iraq war.

The “Coalition of the Willing” is dropping apart. After the withdrawal of Spain, Norway and Hungary in 2004, Portugal, Moldova, Netherlands, Ukraine and Bulgaria in 2005 and 2006 now Italy’s likely Prime Minister Prodi has announced to pull out the 2,600 Italian troops ASAP. The UK will reduce its troop number from 8,000 to 7,000 this month. Only Poland’s conservative Prime Minister Marcinkiewicz, reversing his predecessor’s decision, will keep the Polish force of about 1,500 troops stationed in Iraq, together with a few other European countries like Romania, Georgia and Denmark.

European death toll
The European death toll, as of April 10, is 207 soldiers is 8% of coalition’s total casualties: 103 of them British, 27 Italian, 18 Ukrainian, 17 Polish, 13 Bulgarian, 11 Spanish, three Slovak, three Danish, two Dutch, two Estonians and one Hungarian, one Latvian and one Kazakh. Relatively to the overall troop strength the Iraq war has been as deadly for Europe as for the US. (The image shows relatives of killed British Private Phillip Hewett at a remembrance service at Downing Street on April 26)

That’s a bitter end for a war that many European countries and definitely the majority of the European population did not want. The lack of a unified position within the Union (“old” and “new” Europe) has been interpreted as a split in between the member states, but in fact the role of the Union in Iraq is more complex.

The I-wanna-be-your-friend dilemma
Both in the built-up of the Iraq war and later most of the European governments have expressed the need of keeping the credibility as allies of the US. Especially Eastern European governments, both members and non-members of the Union, have been under pressure: if they want to stay friends with the Bush government and have their share in the obvious benefits of being an US-ally, they have to be supportive of the war. Even the most outspoken critics of the war, Germany, obviously felt the need to take back its capital NO to the war on informal levels of cooperation: German intelligence officers in Baghdad supported the invasion with crucial information.

Gimme all your money
Similar to Afghanistan, the Union has turned into probably the biggest civilian donor to Iraq. The Commission has been the prime donor of the elections in 2005, and European countries and the Union pay for the biggest share of the International Donors conference by far (731 million dollars of 1.3 billion). (IRFFI)

The Bush government, meanwhile, is pulling out of its aid responsibilities. For 2006, USAid has a budget of 360 million dollars for Iraq, down from 2,2 billions in 2004 and 660 millions in 2005. (USAid)

Shared Burden
As seen in Afghanistan, the Iraq war is far from being a US game with no European players on the field. Despite huge criticism from both the European population and many governments, Europe has undoubtedly taken a more than fair share of responsibilities in Iraq.

Europe has played along with the US both in its security objectives (terrorism as the major international threat, immigration, energy supply) and the means (war in Afghanistan and Iraq, containment of Hamas, the torture system). Those myriads of “trans-atlanticists” who demand that Europe shall live up more to America’s expectations may find out: that is exactly what Europe has already been doing in the past few years.

But: has this done the Union any good? Did the means of the past – especially the Iraq war - help achieve the Union’s objectives?

Javier Solana, the Unions top foreign policy official, named the following as the Union’s most pressing issues: Energy security, terrorism, human rights, failed states, non-proliferation (Javier Solana, Sound of Europe, 1/27/06, Salzburg). This set of objectives may be a problem in itself as it partly follows a “we-against-all” (or realist) foreign policy paradigm. But aside from this criticism, I think I’m on the safe side saying that the means supported by the Union have not made the world a safer place. Quite the contrary is true: the handling of post-war Afghanistan, the invasion of Iraq and the following strategic mistakes and the outrageous US/UK torture system are threatening both international and the Union’s internal security in the most blatant way imaginable. And, sad to add, predictably so.

What’s on your list, Javier?
The UN has to clean up the mess in Iraq. That’s how it was done in Afghanistan, with very disappointing results, but there’s no other way. Solving the Iraq problem will need not only loads of money, troops and infrastructure support from the Union, but also heavy support for the African, Iranian and Middle-Eastern UN troops who should be the core of a UN peace force. If we don’t want to administrate another pile of debris like in Afghanistan, this will take years and billions.

Be a partner. The Union’s best time always is when it treats countries like partners, not subordinates. Meaning: Turkey and most of the Arab Mediterranean states are already woven into a network of contracts and agreements with the Union, both politically and economically. They are a huge opportunity. The current process towards those countries needs to be restarted on a fair basis. Plus: strong signals towards a membership of Turkey are needed.