Will Europe be mastered by history in 2023?

One of the standard aphorisms in my political risk business — used to describe whether a country is rising or falling — is as brutal as it is profound. Either a country is mastering history, so the shorthand goes, or history is mastering it. There is little doubt that Europe, over the last sleepy generation, has been mastered by larger global political forces it was barely even aware of, as it lay basking in the sunny false dawn following the end of the Cold War.

One of the standard aphorisms in my political risk business — used to describe whether a country is rising or falling — is as brutal as it is profound. Either a country is mastering history, so the shorthand goes, or history is mastering it. There is little doubt that Europe, over the last sleepy generation, has been mastered by larger global political forces it was barely even aware of, as it lay basking in the sunny false dawn following the end of the Cold War.

But, with the coming of the Ukraine war and the stirrings of the Sino-American strategic competition for dominance in the Indo-Pacific, we have reached the end of the end of history. Suddenly, global geopolitics and great power competition are all the intellectual rage again, though in truth they never really departed from the scene. Instead, and nowhere more so than in Europe, their enduring importance was merely conveniently forgotten as the continent ruinously chose to take an intellectual holiday from history. But time waits for no man — nor for any decadent continent, either. The damage done by this willful ignorance of how the world really works is only now becoming apparent.

By every great power measure, Europe is a mess. The three basic pillars of power have remained the same since the time of the ancient Greeks. What is the state of a country’s army? What is the state of a country’s economy? How politically unified is a country to act both within and beyond its borders? By these exacting and unchanging political risk standards, Europe remains a busted flush as a great power, a political entity promising much and perpetually underdelivering.

First, the continent punches way below its weight in terms of its military. Germany, both Europe’s greatest power and the source of many of its ills, is a case in point. Berlin long has outsourced its military policy to America, its energy policy to Russia (ruinously), and its trade policy to China. Rather than serving as the engine of the European Union as a rising power, instead Germany has been an intellectual black hole over the past generation, where every good idea for Europe’s revival goes to die.

Defense spending estimates for 2022 make the case clearly for Europe being overrun by lotus-eaters. Whereas the U.S. will spend 3.5 percent of its GDP on defense, only France comes close to NATO’s required 2 percent of spending at 1.9 percent. In contrast, Italy will spend only 1.5 percent, Germany a laughable 1.4 percent, and Spain a risible 1 percent. This isn’t remotely intellectually serious even as the problem has festered for a generation. I remember telling the former head of the German armed forces that my high school football team could take the German army — and I wasn’t far off the mark.

The problem with having only carrots (economic tools) without any sticks (military tools) is that such a strategy works only in a world populated entirely by rabbits. And, say what you will of them, neither President Vladimir Putin of Russia nor President Xi Jinping of China are rabbits. Europe is simply not fit for purpose in a world where military force still matters, as it has every day since the dawn of time.

Economically, Europe is also so much less than meets the eye. While possessing a huge internal market roughly equal to that of the U.S., its sclerotic economic model means the continent falls ever further relatively behind rising great powers such as China and India, as well as the emerging developing world. Again, Germany — the continent’s undoubted economic powerhouse — best explains the problem. Here the Ukraine war has done more than point out Germany’s military follies; it also underlines the fact that its vaunted economic model is now irretrievably broken.

The German model was based on buying cheap Russian energy to make high-end products (machine tools, petrochemicals, luxury cars) that were, in turn, swallowed up by an economically ravenous China. Now, in our dawning age of insecurity, the Russian cheap energy inputs that the German model requires are definitively at an end, even as the outputs — assured access over time to China’s market, assuming it to continue booming and assuming geopolitical tensions with Beijing can be contained — is more up in the air than ever. The German model is definitively broken, and nothing has yet emerged to take its place.

At the same time, Europe has become a daycare center, chock full of a decadent population used to taking more out of the continent than they put in. For example, at the end of September, opinion polls in France showed that around 55 percent of its populace want the pension age to stay the same (62), or to drop back to 60, the demand of both the far left around Jean-Luc Melenchon, and the far right around Marine Le Pen, who between them can block the reformist urges of President Emmanuel Macron in the French parliament.

It is not that Macron has not identified the obvious, glaring problem. He has said, “The truth is that we have to work more and produce more in our country … if we are to keep the French social model.” But a continent in advanced-stage decadence finds this almost impossible to countenance emotionally and intellectually. The notion that people are living dramatically longer than when the safety net was first constructed, and that this requires all of us to work longer, is seen as almost a war crime even to mention. But economic reality exists, whether you choose to ignore it or not.

Finally, Europe is a Tower of Babel. How could it be otherwise? There are 27 countries in the European Union; I could not cajole 27 of my friends to agree on a common ice cream flavor, let alone something as complicated as reaching a genuine consensus over setting out a common foreign policy. As such, the EU’s policy outputs, even when generally on the money, will always amount to half-measures, compromises that do not genuinely “solve” any of its problems.

The common position on Ukraine is a case in point. Beneath a surface agreement about the war, deep fissures exist on the continent, with the Poles and the British downright hawkish, while the Germans, French and Italians (in terms of public opinion) are far more eager to end the war on almost any terms. As the war drags on into 2023, look for these hairline cracks to become canyons.

Militarily anemic, economically sclerotic, and politically divided — this is the reality of a Europe that has been mastered by history over the past generation. It must face up to these festering problems or be definitively swept into the second tier of powers. And there is simply no more time to waste.

This piece was originally published in The Hill.

The EU, not Meloni, is the threat to democracy

I have found through my constant exposure to them through the years that the EU’s intellectual cheerleaders among geopolitical analysts — funded as they so often are by the very institution they are supposed to be impartially analyzing — are as numerous as they are clueless.

At my political risk firm, the joke goes that if Brussels is “for” something — entrusting its energy security to the Russians, confidently predicting that Europe will emerge as the dominant superpower in our new era, or ignoring the threat that China poses — we should instinctively bet against them, so often and regularly are they proved mistaken. Beyond the mirth, there are two concrete reasons EU analysts are so unerringly wrong.

First, the corkscrew way EU cheerleaders reason dooms them from the start. In a sort of Kafkaesque example of magical thinking, they believe that while EU policy success confirms the upward trajectory of Brussels, failure also somehow means the bloc is about to arrive. Success obviously means the EU is headed in the right direction; failure, in a bizarre form of Hegelianism, means Brussels will inevitably “learn” from whatever it has done wrong, immediately and rationally make the necessary corrections, and move onward unto sunlit uplands. As ever with wish-fulfillment, these cheerleaders fool no one so much as themselves.

Their second major intellectual mistake is to confuse analysis with what they would like to happen. Brussels advocates invariably tout the death knell of populism, the EU’s sworn enemy, because across Europe it embodies the very things Brussels most hates — it is nationalistic, suspicious of experts, and democratic rather than elite-driven.

So, EU cheerleaders excitedly (but wrongly) thought European populism would be extinguished as a result of the pandemic crisis, when the vital need for the supremacy of technocrats became self-evident (at least to them). Instead, these experts were proved wrong time and again — from vastly overstating the efficacy of lockdowns, to the quasi-religious primacy of mask-wearing, to wholly subordinating economic, social and democratic rights, all in the myopic service of a health dictatorship.

Next, with the invasion of Ukraine, these same experts felt populism would come to an end, because the overriding imperative of international cooperation (a supposed strength of Brussels) over the conflict was self-evident. Once again the EU’s cheerleaders got it wrong, while populists learned the realist lesson that a country’s specific national and geostrategic interests are paramount; plus actually having an army — neither of which are policy areas in which the EU is anything other than a pipsqueak.

Recent political facts confirm my political risk call, rather than that of my cheerleader foes. In Sweden, the rightist populist Sweden Democrats, rather than disappearing as most EU analysts had confidently predicted, now hold the balance of power. Even more importantly, last week in Italy there was an overwhelming populist rightist electoral victory over the remnants of the Brussels-installed center-left political establishment. One of the great powers of Europe, contrary to the fever-dream of the EU’s favored pundits, decisively elected a government deeply skeptical about the very nature of Brussels itself.

Of course, confronted by the imminent election of a government not to its tastes, the EU’s authoritarian visage, so often hidden behind banal verities about its innate goodness, became plain for all to see. Just a week before the Italian election, a grim European Commission President Ursula von der Leyen, referencing serial troublemakers Poland and Hungary, threatened that Brussels had “the tools” to deal with wayward members not content to sing along with the EU’s supranational, elite-driven hymnal.

What did Italy’s newly victorious Giorgia Meloni do, even before coming to power, that so threatens the Brussels establishment? Or, to put it another way, what explains the meteoric rise of her rightist populist Brothers of Italy party from 4 percent of the vote in 2018 to a dominant 26 percent now? First and foremost, Meloni crucially decided to stay out of the EU-imposed government of national unity run by Brussels darling Mario Draghi, which managed to last for only 18 storm-tossed months.

Meloni proved to be highly effective in opposition, artfully questioning whether Draghi’s authoritarian response to COVID was serving basic democratic ends, given his habitual governing by authoritarian decree rather than the usual parliamentary process. As ever, biography proved to be destiny; Draghi, a technocrat to his fingertips, thought the pandemic crisis too important to be left to the vagaries of democratic scrutiny. Meloni brilliantly made her commitment to democracy (despite the present hyperventilating of the mainstream media) abundantly clear, while yet another unelected, Brussels-imposed prime minister ignored any shred of democratic practice.

Second, this Brussels-imposed elite (incredibly, Meloni will be Italy’s first elected prime minister since the odious Silvio Berlusconi was ousted by the EU in 2011) has utterly failed at the policy level. Extraordinarily, Italian GDP per capita is lower now than it was before the country adopted the euro in 1999. This lost economic generation is only a few years away from irrelevance, more likely to end up a crumbling, irrelevant Greece than to emerge as the new Germany.

In just practical terms, EU tutelage has been an absolute disaster for Italy, and for a long while. It is little wonder its citizens have revolted against its EU-shackled establishment.

The piece was originally published in Arab News.

Europe lacks a captain for its drifting ship of state

One of the things I have learned from my decades in the political risk business is that experts usually ignore the fact that specific people truly make policy.

It is easy, and intellectually correct, to focus on the grand historical forces of analysis: to look at things like the global macroeconomic situation, the overall geopolitical state of global power, the abiding ideology of the times. All of this is absolutely necessary to get right, and almost never makes it into the facile and simplistic column inches of the mainstream media, whose lack of genuine depth is increasingly becoming a global problem.

But there is another, historical level of analysis that eludes most of my political risk competitors, and explains their dire records on predicting what will come next in the world; they simply do not understand that specific people, with their individual strengths and weaknesses, are in charge of the world. Really understanding these specific people, as well as comprehending the general state of the planet, is absolutely necessary for getting political risk right.

US Supreme Court Justice Oliver Wendell Holmes understood this perfectly when he said of Franklin Roosevelt that he had a second-class intellect but a first-class temperament. It is not that Holmes thought FDR was stupid; he did not, as Roosevelt was one of the smarter men ever to have been president. It is that Holmes correctly saw that the key to Roosevelt’s unparalleled political success lay instead in his character, his almost feline ability to sense, in any social situation, what others wanted, and to know what he was prepared to give. This specific attribute of a specific man is not studied by anyone other than historians (and not by enough of them, either) but it is a vital piece of the puzzle in making specific sense of perhaps the most important person of the 20th century.

All of which brings me to the present becalmed state of the declining great power that is Europe. Yes, there are a legion of structural reasons for the continent’s present malaise: It lacks a common army to matter in our increasingly rough-and-tumble geopolitical world (as well as, in its decadence, the will to have one); it lacks the economic dynamism to grow its way out of macroeconomic difficulties, with far too many entitlements and far too few working hours; it lacks an overarching country able to drive the European process forward, instead having a hodgepodge of great powers (Spain, Italy, France, and Germany) constantly vying for advantage.

All of this is true and all of this must be thought about far more often by a mainstream media that mindlessly cheerleads for Brussels, without wondering why the continent perpetually disappoints in great power terms. But there is also the historical, specific, personal level of assessing the continent’s present leaders that is hamstringing Europe, dooming it to decline even faster than all the more general factors would allow for.

Currently, perhaps only vainglorious, (overly) confident, bold French President Emmanuel Macron has the temperament to move the European project forward. However, his specific political problem is that the French people have just knobbled him in parliamentary elections, denying him a majority precisely because they feel he spends too much time swanning around the world making grand pronouncements and too little time governing France.

Nor is German Chancellor Olaf Scholz the answer. He won office precisely because he was inoffensive, cautious, and meek; in other words, he most resembled the suicidally beloved outgoing Angela Merkel. While having the qualities of your local branch bank manager might work in calmer times, in our age of perpetual crisis such attributes prove to be self-negating.

The other lesser European powers are also of little help. Prime Minister Pedro Sanchez leads a rickety coalition government in Madrid, behind in the polls to his center-right People’s Party rivals. For these specific political reasons, his famously insular country, never keen to take center stage in Europe, can be of little help, even if it wanted to dramatically move the European project forward.

The same is even more true for Italy, where outgoing premier Mario Draghi’s unelected administration — parachuted in to somehow govern an increasingly ungovernable country —failed to provide Rome with the stability that had been confidently expected; it fell in just a year and a half. Instead, Italy’s new (and at least elected) government will come from the right, with populist Giorgia Meloni the putative new premier. While she is unlikely to bite the EU hand that is feeding her (with Brussels set to provide Rome with a gargantuan €200 billion in post-COVID aid), her basic euroskeptic ideology means she is more likely to block Brussels having a common approach (over immigration above all) than to champion the European project.

For all these specific historical and political reasons, as well as grand world historical forces, the easiest bet in the political risk world is to see Europe as an idea whose time has passed. The only way this downward trajectory would be altered is if Europe produced a leader with a first-class temperament, and a decisive political majority to match. In the world we actually live in, that simply won’t happen.

This piece was originally published in Arab News.

At last Italy is about to return to democratic government

It is a remarkable, overlooked fact that Italy hasn’t governed itself in a democratic sense for quite some time. Incredibly, Silvio Berlusconi was the last prime minister who explicitly ran for the job at the head of a major political party, in 2008. Since then, Italy’s ramshackle governance has been a case study in the EU elite’s ruinous quasi-colonization of the country.

Most recently, this anti-democratic scenario reared its ugly head again. Following the failure of two governments led by the unelected Giuseppe Conte and supported by the out-of-their-depth Five Star movement, yet another unelected EU functionary was parachuted in to save the day. Mario Draghi, the former successful head of the European Central Bank, was summoned by his EU masters to take charge in Rome.

His government was designed to steer the country through the pandemic, and also to wisely allocate the more than 200 billion euros coming Italy’s way in terms of the EU’s massive aid package — the country’s last, best chance to drag itself out of its generations-long economic torpor. For the astounding reality is that Italygrew at average annual rate of zero percent between 1999-2016; this amounts to nothing less than a lost economic generation. Above all, the EU’s mandarins believed the highly respected Draghi would be able to provide stability until the next election, then scheduled for 2023.

But, as the Scottish poet Robert Burns put it, the best laid schemes of mice and men go oft awry. Like most Western governments, Draghi made monumental mistakes over the pandemic, opting for (unsurprisingly given his pedigree) a top-down, draconian approach that until recently has still forced Italians into the dinner-theater of wearing masks, long after the rest of Western Europe came to its senses. The economic losses have been immense, as has been the loss in the presumption of individual liberty.

But Draghi’s biggest failure is that the EU’s anti-democratic power play has failed in the most basic terms, in that he did not provide the stability that was the main point of his technocratic government in the first place. Having served only 17 months, on July 21 he was forced to resign as the populist Five Star movement, the rightist, populist Lega, and Berlusconi’s Forza Italia parties undermined him. Without a democratic mandate, Draghi’s government proved the opposite of what the almost-always-wrong Brussels elite had confidently predicted; it was fragile rather than strong, as it simply had no sort of popular mandate to sustain it when times got tough.

It is little wonder that the main beneficiary of the crisis, Giorgia Meloni and her rightist, populist Brothers of Italy Party, have risen in popularity as the only major party that shrewdly chose to stay outside Draghi’s technocratic government. She leads a surprisingly united Italian center-right alliance, also comprising Matteo Salvini’s populist Lega and Berlusconi’s centrist party.

An Aug. 12 Politico poll of polls has the Brothers of Italy with 24 percent of the prospective vote, the Lega at around 14 percent, and Forza Italia at seven percent. The fractured center and center-left (comprising five parties) together have only 45 percent of the vote between them. There is little doubt the Italian right are on course for a famous victory.

The deal welding them together is that the party in the alliance with the most votes will select the new prime minister, an eminently democratic point of view. Meloni therefore finds herself in the driver’s seat for the job, because she leads in terms of the democratic vote. The irony is that while Meloni is trying to quell fears about her party’s quasi-fascist lineage, it is she who has been the true democrat.

Meloni, who personally gets on quite well with the outgoing Draghi, intends to follow in his economic footsteps, carrying out Italy’s recovery plan in order to receive the cascade of promised EU funds. She is likely to also push for conservative policies such as curbing immigration and flattening the tax rate for lower earners, while increasing funding for child-friendly policies (nursery schools and child benefits).

On the foreign side, given her close ties to the global conservative movement, Meloni will find the progressive Biden administration a tough partner to deal with ideologically. Likewise, within boundaries the haughty Brussels functionaries will reap what they have sown, due to Meloni’s social conservatism, latent euro-skepticism, and plans to unilaterally curb immigration. However, given Italy’s monumental and growing public debt rate (an Olympian 152.6 percent in the first quarter of this year) there are limits to how far Rome can go in biting the hand that feeds it.

Nevertheless, for all the challenges ahead, the good news is that Italy has repudiated the notion that it is a quasi-colony of the EU. Now it is up to Meloni to govern more effectively than her hapless technocratic predecessors, and thus avoid the full colonization by Brussels that economic collapse would surely bring.

This post was originally published in Arab News.

Putin’s mistakes birth a new world order

There is little doubt that Russian President Vladimir Putin’s miscalculations have birthed a new world order. At the strategic level, the Russian President is guilty of three fatal strategic errors.

First, his battle plan for invading Ukraine was far too byzantine, a fussy three-pronged assault that quickly bogged down partly as a result of this complexity.

Second, Putin didn’t believe that Ukraine was truly a nation, that the country (particularly its Russian-speaking eastern portion) would rally around its beleaguered government in Kiev, let alone fight heroically for it. In line with this, the Russian President had no idea that Ukrainian President Voldomyr Zelensky, frankly a bit of a failure in dealing with Ukraine’s daunting domestic problems, would prove to be a war leader of Churchillian caliber.

Third, the Kremlin did not count on quick and decisive Western support for Ukraine, embodied in the crippling sanctions imposed on a furious Russia, as the EU and Germany awoke from a generation’s strategic nap, rediscovering the seminal point that history has not yet come to an end, and that military might remains (and always will) a major tool of international relations, whether one likes it or not. These three dramatic miscalculations led to the failure of Russia’s blitzkrieg.

Crises clarify

The arch-realist Otto von Bismarck, as ever, put it perfectly, “When you draw the sword you roll the dice,” meaning that all sorts of unforeseen strategic consequences result when war is declared. War is the ultimate geopolitical crisis; they both change history and (even more importantly) illuminates history. War is the flash of lightning that suddenly makes the terrain clear to even the dimmest of analysts, such as those Europeans who have mocked a generation’s worth of pleas that they get serious about both military spending and having a sane energy policy.

For at the higher global geopolitical level, Putin’s failed gamble is also of the utmost importance, as it clarifies the great power division of the new era that we live in. On its own, the war in Ukraine has moved two of the great powers – the EU/Germany and Russia – from a neutralist position, and into (respectively) the US and Chinese superpower camps. Gone were the days of Brussels and Beijing strategically hedging as to their overall strategic orientation. The war reminded Europeans that freedom is not free; that it requires an autonomous military and energy policy, rather than merely free-riding (while often lazily criticizing) off the Americans.

But the war has also chastened the wounded Russian bear into being forced to wholly throw in its lot with China, as it has no other geostrategic options. Amongst great powers, there is now a clear alliance of revisionist autocracies (China and Russia) confronting a compact of status quo democracies (the US, EU, Japan, and the Anglosphere countries). While Washington is far from out of the woods, such a constellation of forces favors the West remaining the dominant political alliance of the new era. Ukraine has revealed all this, much as we have been saying for several years, in the past momentous time where (to paraphrase Lenin) the weeks have been where decades happen.

The West is newly united; the world is not

So far, so analytically good. But there is more ambiguous, even ominous news beneath this geopolitical headline. At the next layer down from the great powers, looking at regional power configurations across the globe, the West’s dominance is not the real story. Beguiling India, here, is the canary in the coal mine, illustrating that all is not well for the West.

Since the end of the Cold War, and with the subsequent rise of China, New Delhi has steadily drifted towards the American orbit. Shared fears of Chinese adventurism, exacerbated after Xi Jinping came to power in March 2013, have knitted the anti-Chinese Quadrilateral Initiative together, composed of superpower America, and great powers India, Japan, and the Anglosphere (Australia). New Delhi’s strategic fears were decisively confirmed when Beijing attacked India along their de facto border in the Himalayas in May 2020, a clear act of Chinese aggression. Before Ukraine, India has been increasingly confidently seen as fitting snugly in the US-dominated democratic great power camp.

But the subcontinent has a way of upending facile Western characterizations. Over the Ukraine War, New Delhi – despite a lot of American and European diplomatic pressure – has steadfastly clung to a policy of neutrality, refusing to castigate Russia for its obvious aggression. Strikingly, India (unlike Japan, the EU, and the Anglosphere countries) has not quickly and reflexively jumped on Washington’s pro-Ukrainian bandwagon.

There are numerous interest-based reasons for this strategic divergence. First, historically, India long sided with the USSR during the Cold War; support for Russia even after 1991 is a long-ingrained habit. Second, Russia remains New Delhi’s largest source of weapons imports, even as the US, Israel and France have gained market share. Third, an oil-hungry and energy-poor India has spotted the chance to obtain Russian oil and natural gas at bargain basement prices, as the US and UK energy blockade of Moscow comes into effect, and the Kremlin looks to divert its overall energy supply from a suddenly hostile West.

These basic points of national interest were all present before the Russian invasion, but it took the crucible of war for the world to see that maybe India was not yet prepared to march in lock-step with the American-dominated world, after all.

A complicated, multipolar menage awaits the West

Worse, from a Western perspective, India is not alone in disdaining the American lead. Significant regional powers in the Middle East (including traditional US allies Saudi Arabia, and the UAE, as well as usual suspect Iran), and outliers North Korea, Venezuela, Cuba and much of Africa, have studiously clung to a path of neutrality regarding the conflict. In fact, over Ukraine, it would be far more accurate to say that – while at the great power level the West is presently dominant and that it is united around a pro-Ukrainian policy over the war –the rest of the developing world, epitomized by emerging great power India, are far from being in the Western camp.

The good news for the West then, is that it is surprisingly united as the new era dawns. The bad news is that the rest of the world has yet to follow its lead. Worse still, the developing world’s two great power champions, China and India, while increasingly hostile to one another, share an antipathy for merely going along with the West in our new era. It will take realism, and a Bismarck, for the West to maintain its dominance in our new era. But it can and must be done.

This post was originally published on Aspenia Online.

The EU awakes from its long strategic slumber

For the first 20 years of my working life, about the easiest general political risk call I could make — whatever the crisis — was that the EU could be counted on to punch well below its weight. Despite having one of the three largest internal markets in the world (along with the US and China), Brussels was bound to disappoint, doing little practically in terms of furthering its specific foreign policy goals, as often it didn’t have any. Nor was it prepared to expend the blood and treasure necessary when it did.

Perennially betting against Brussels — economically sclerotic, militarily impotent, and geopolitically divided — did nothing to harm my political risk call record. Better still, from my point of view, the EU (shamefully) subsidized a coterie of supposedly independent foreign policy experts, who — well aware of where their bread was buttered — functioned at international conferences as little better than cheerleaders.

On the rare occasions the EU was successful, these partisans would trumpet this as a sign that Brussels was ascending to superpower status. When it failed, the not-so-neutral experts would sagely intone that, in failure, the EU would “do its homework,” using its missteps to make the next great leap forward in terms of its integration. This circular analytical reasoning mostly fooled those who were themselves spouting such logical nonsense, but my competitors’ being constantly wrong about Brussels has been very good for business.

However, as the historical adage has it: “There are decades where nothing happens, and there are weeks where decades happen.” With the Ukraine war, we are living through such weeks. A primary requisite of first-rate political risk work is to constantly check assumptions, even those such as my call about the EU, which have been on the money for decades. For the adage is right: Things change, the world changes in an instant; and we have to be ready for it.

In the case of the EU, the basic problem has always been Germany, its economic motor and by a long way its most important state. Henry Kissinger neatly encapsulated Berlin’s historical tragedy: It is too small to dominate the whole of Europe and too large to be just one of a series of European great powers. This uneasy structural reality was greatly exacerbated during the do-nothing years of Angela Merkel’s chancellorship, when for decades nothing happened except Berlin making of itself an intellectual and strategic black hole.

Steadfastly refusing to end its ruinous holiday from history, Merkel’s long, dreary rule led to Germany adopting a mercantilist, economics-first foreign policy, valuing its increasing trade ties with China and comfortable with its energy dependence on Russia. Putting itself in such a strategic straitjacket inevitably lead to Germany adopting a quietist, quasi-neutralist foreign policy, as to rock the boat by siding with the West against these revisionist powers would have had real and disastrous economic consequences. Never said in all this flawed logic was that it was Merkel who was deciding to wear the straitjacket of her own free will, rather than a cruel indeterminate fate thrusting such a choice upon her.

For a generation, this neutralist Germany has made the adoption of a genuine common European foreign and security policy an impossibility, as with a Gaullist France tugging one way and an Atlanticist northern and eastern Europe another, a chaotic tower of strategic babel was the only possible outcome. It was Merkel’s steadfast refusal to re-arm and to have any real outward-looking foreign policy that made a mockery of every effort at Europe forging a common strategic identity. As long as Merkel’s isolationism held sway, betting against Europe was easy.

But, in the blink of a historical eye, things have changed. In about 10 days the new German government of Olaf Scholz adopted almost every policy I have been begging them to undertake for the past 20 years. Germany can, after all, meet NATO’s 2 percent of GDP pledge for defense spending. Better still, after a generation of Germany’s weapons systems atrophying, Scholz has set aside €100 billion to bring its military kit up to speed.

In energy policy, too, big changes are afoot as Berlin has de facto abrogated the Nord Stream 2 pipeline project with Moscow, after decades of western pleas for them to do so fell on deaf ears. Equally significantly, Germany’s isolationist drift has been halted as it moves resolutely back into the US-dominated Atlantic camp. Simply put, in 10 days there has been more strategic movement in Germany than in the past 20 years.

At the higher, European level, Germany’s sea-change alters everything. Suddenly Europe is, in the medium term, not going to be militarily impotent; rather, with a re-arming Germany and an already militarily capable France, it will be a strategic force to be reckoned with. Vitally, Europe’s collective strategic drift toward either neutralism or chaos is also at an end; it is now solidly in the Atlantic camp.

There are surely many bumps in the road ahead, and changes this profound will not proceed in an easy straight line. But that does not lessen the momentous importance of the past few days. Europe’s medium-term strategic position in the world, for the first time in my working life, is on a decisive political risk upswing. 

This post was originally published in Arab News.

We must stop pretending the EU is a great power

This is a tale of two delusional think tank meetings I have recently attended, illustrating how far gone is most political risk analysis regarding the status of the EU. Cheerleading has taken the place of thinking, as the simple fact is that Brussels is funding many of the supposedly independent observers at such conclaves. To expect critical thinking from “experts” whose financial imperatives revolve around keeping the EU’s mandarins happy is to expect too much.

At the first meeting, I found myself sitting on a panel with an American Wilsonian. He was representing the Democratic Party view of US relations with China, while I represented the Republican Party view. After a good discussion, questions came from the primarily European audience. The first revolved around the fact that the questioner wanted to know where the EU fits into the strategic picture of the Sino-American cold war, as wasn’t it so that Brussels must be counted as the world’s third great superpower?

Even though it was a Zoom call, my Wilsonian counterpart — whom I agreed with over almost nothing — and I exchanged ironic glances. Finally, for all his innate pro-EU inclinations, he brutally told the questioner the truth: The EU, while a trading superpower and a huge internal market, simply doesn’t play at the global strategic level as a great power (let alone a superpower), as it is less and less economically dynamic, is endemically politically divided and is militarily (other than France) impotent. In the shocked silence that followed, I quipped that I wanted to cede all my time to my Democratic counterpart for having the temerity to tell the brainwashed audience the truth — that the EU simply isn’t a great power.

If this is so, my second think tank meeting focused on the nub of the problem: A mercantilist, neutralist, isolationist-leaning Germany. In standard fashion, the German think tank denizen sent to debate me made all the usual excuses; while I am right to be critical, Germany (in that most galling of phrases) “would now do its homework,” easily overcoming a generation’s-worth of historical and empirical evidence to the contrary, and would decisively right its ship of state over the coming months.

Exasperated, and tired of the analytical lying at cocktail parties, I brutally interjected that the reality is that Germany would do nothing over the next year and change nothing, as its people prefer their cosseted lifestyle (and genteel decline) to the real sacrifices that would be involved in paying for a relevant military and crafting a common European foreign policy. I was met by hateful stares and a sullen, unchallenged silence, for what could they say, given the last decades of Berlin’s holiday from history?

Crises intellectually clarify, even for the most obtuse observers. Two recent challenges to Brussels from the world’s revisionist powers, China and Russia, ought to make plain that wishful thinking has taken the place of facts-based political risk assessments of an EU that is so much less than meets the eye.

First, tiny Lithuania — to the fury of Beijing — has decided to favor Taiwan in the crafting of its foreign and economic policy. China responded by putting pressure on Vilnius and defying the EU, particularly Germany, to do anything about this. While in the past few days, the EU launched a legal action against China at the World Trade Organization (WTO) after Beijing restricted or blocked imports from and exports to Lithuania, Berlin responded precisely as I would have predicted — that is, in a neutralist, isolationist, mercantilist manner — and not as EU cheerleaders would have it. Glumly aware, as an export-driven superpower, that China, for the fifth year in a row, is its largest export destination, Germany is pressing Brussels to tone down its criticism of China and to de-escalate the controversy.

Major German companies, particularly carmakers heavily dependent on trade with Beijing, have warned Vilnius that they will pull out of Lithuania unless the dispute is quickly settled. For, despite all its usual blather about how much the EU means to it, when push comes to shove and with its now economic interests on the line, Berlin has seen to its commercial interests  at the expense of European unity.

Likewise, over the Ukraine crisis, in a basic way President Vladimir Putin is airing his grievances. As such, in the earliest days of the crisis, Moscow met with the US, NATO and the Organization for Security and Cooperation in Europe, not with the EU.

Why should he? In practical terms, Moscow met great power to superpower (the US), with the world’s most important military alliance (NATO) and with the largest gathering of transatlantic states (the OSCE). The EU simply does not play a major role in strategic terms; for Putin to prioritize meeting with Brussels would have been a colossal waste of time. While a shocked Brussels looked impotently on (and I am shocked that they are shocked), Putin made it clear that, in a crisis, the EU simply does not have the relevance its cheerleaders dream of. Nor is this state of affairs likely to change.

Instead of swallowing comforting, if delusional, fairy tales about its far-flung importance, it is time to analytically shout from the rooftops the obvious: That the EU emperor simply isn’t wearing any clothes.

This post was originally published in Arab News.