It’s hard to remember now, but in the early 2000s, the EU appeared to be the onrushing power. It was gaining new members, who clamored to join, both its economy and the Euro were strong, and it had avoided entanglement in Iraq. Its prestige was high (having nations begging you to let them in their club tends to do that).
What I suggested the Europeans do, at the time, was try and make the Euro into an alternate reserve currency. They also should have increased their military, making them non-reliant on the US in the guise of NATO. Within the EU, steps needed to be taken to stop the abuse of the Euro by Germany as a subsidy for its manufacturing (because the Euro was lower than a pure-German currency would have been) and to allow genuine subsidies in other countries to make up for the disadvantages they would incur as a result of using a Euro — which was priced too high. Aggressive moves towards energy independence would also be necessary, as Europe was –and is — obviously resource deficient.
None of this was done. It appears that EU leaders were comfortable being US subjects, or at least, they didn’t want to challenge it. Germany’s policy towards Russia was trade, sold on the assumption that trade alone would make them good little Europeans, without offering them a path into either NATO or the EU, and with the added insult of allowing and participating in the looting of Russia during the 90s.
As for economic policies like subsidies and some counterweight to German exports, well, that would contravene the neoliberal, technocratic ideology that very much rules Eurocrat elites: the rules are the rules and if your economy gets trashed by them, as Finland and Italy, among others, found out.
In 2008, the Europeans followed the Fed (and, admittedly, everyone else) into a gigantic bank bailout, then spent most of their time since printing money for rich people (a reasonable description of central bank special operations during that era).
Meanwhile, anti-Russia sanctions proliferated, Russia-EU/US relations deteriorated (especially due to to the fight for influence over Ukraine — but that was definitely not the reason), and it all flared into crisis when Russia invaded Ukraine after years of Ukrainian military operations in the Donetsk and Luhansk Republics.
That led to sanctions, which have so far hurt Europe worse than Russia, as the European (and especially German) power grid needs Russia natural gas and coal which they can’t easily obtain elsewhere. Damage to industry has also occurred, and some observers expect it to cost entire German industries and millions of jobs; nor is the rest of Europe unaffected.
The problem now is that a fast move away from natural gas, oil, and coal isn’t possible. Heat exchangers work, but there aren’t enough available. Renewables are great, but transitioning takes time and anti-Xinjiang sanctions mean that 50 percent of the world’s silica supply, along with much of its solar panels, are no longer available.
Meanwhile there’s a heat wave, Europeans don’t have air-conditioning, and live in buildings largely designed for cold weather (with some southern exceptions), and, as everyone loves to say, “Winter is coming.”
Transition is not impossible, but it will take time. It is going to require restarting any nuclear plants which can still work (the numbers do not work without it) and probably building some new nuclear reactors, along with a buildout of various forms of renewable energy. Even moving to imported, and more expensive, US natural gas is not as easy as it seems: it requires infrastructure which does not exist.
Russia, meanwhile, as we’ve discussed before, is restricting natural gas supplies and threatening cutoffs. They can’t buy European goods, and they need the money less than Europe needs gas, coal, and minerals. They are diversifying to the East and South as fast as they can. Add to that to their position as one of the world’s largest grain producers is serendipitous at a time grain production comes under pressure from climate change, and consider that they are capturing a fair bit of Ukraine’s farmland, some of the most productive in the world.
Then there is China. Europe does a lot of business with China and there are massive trade ties. But Europe continues its anti-China rhetoric and keeps putting on additional sanctions against China. China wants the European market, and there are still some advanced items they need to buy from Europe, but political considerations, especially with regards to Taiwan and Xinjiang, may trump such considerations. In particular, it is not in China’s interest for Russia to be defeated or broken up as so many in Europe want, as Russia is a key supplier without which China cannot resist a US naval blockade.
Europe finds itself in a position where it’s scared of Russia and outraged. Eastern Europeans in particular want a complete hardline because they genuinely fear conquest or Finlandization. Without reliable access to Russian resource, Europe is forced to rely on the US and various unpleasant Middle Eastern states and to pay higher prices.
And meanwhile, the simple fact is that transitioning to energy and resources without Russia is hard and will take years. I’d think a full transition, even if done competently, will take a decade or so. Combined with the need for the US in order to stand up to Russia (EU militaries are a joke, Ukraine actually had the largest one), and the Europeans find themselves completely back in US satrapy mode. The US is sending more troops and building bases and that’s how it has to be, if hostility to Russia remains.
Which means that the EU has another task: it has to build its own military, capable of standing up to Russia. This is by no means impossible: Europe is technologically advanced and still has the necessary industry, including world leading aviation, but right now all that is happening is buying more US made weapons and hosting more US troops.
If Europe wants to be anything but a satrapy, it has to fix it energy and resource issues; it has to build a military and it needs to do something even harder—it needs to rethink its ideology, and allow proper industrial policy internally. This is hard to do when it’s dependent on outside resources from a hegemonic power, but if it refuses to do so, it will remain an American satrapy.
How much of this will be done is unclear. Exchanging reliance on Russia for the US may seem like an improvement, but it is still dependence and if Chinese relations sour, the Europeans become “locked in”, with few options.
It’s hard to imagine the current generation of European leadership managing this well, but perhaps they will surprise or, more hopefully, perhaps they will be replaced by more competent politicians.
But overall, it looks like Europe is slowly marching towards its historical norm, less and less important and powerful on the global stage.
A lot, of course, will depend on climate change and who gets hit the worst and handle it the best, but right now Europe looks to be in decline, with an opportunity, if they take it, to use this crisis to come out stronger and less dependent on outsiders.
I hope they take the opportunity.
bruce wilder
At Crooked Timber, someone once asked how the EU could best reform structurally and I answer. I surprised myself with a good answer: the harmonized VAT could be modified to allow national governments to set the equivalent of a tariff on imports even from other member states, with the national funds flow available to fund euro-denominated national debt. This could solve several problems with EU structure: national debt other than Germany’s could go back to being more nearly risk-free, which would shore up the Euro’s potential as a reserve currency. Chronic debtor/current account deficit countries in the South could pull this policy lever to defend themselves against prejudicial terms-of-trade. Nation-states would have greater scope for organizing along national lines their economic development and the states would have some leverage against the center, remedying somewhat the democratic deficit.
I think the EU is actually a very good idea is they could find a better balance between parts and whole. The centralization of imperial monarchical states trying to assemble disparate regions into “united kingdoms” ruled by a warrior caste was a political disaster. An EU that could keep the peace internally could let democracies decentralize: let Catalonia, Bavaria and Scotland emerge like Slovenia, Czechia, Latvia — these are the right scale for representative democracy. Let an EU center handle the large-scale things, like transport and electrical nets and defense.
Chiron
The EU would need a use reform to work properly, maybe even expel some countries like Lithuania or countries who are too anti-Russia.
Europe should be divided in two imperial camps for peace, the EU becoming a federal union with its own military, further adding Norway, Swiss, Iceland, all former Yugoslavia, Moldova with the exception of transinistria, and not moving further East. Other side being the Russian Empire, with what is left of Ukraine, Belarus, Georgia, Armenia, maybe the Baltics if they don’t stop bitching, end NATO for good, let Turkey unify with Azaerbaijian so the Turks can control the Middle-East again.
VietnamVet
Europe is between a rock and a hard place. It is enduring Dante’s summer and Hodor’s winter is coming. There is a natural human need for power and status. Puny little democracies don’t satisfy them. WWI showed that Imperial Monarchies do not work, three vanished. After WWII, a western democracy and a command controlled Soviet Union and then China won. Instead the West threw it all away and went back to being an Oligarchy and a privatized, Meghan and Harry, Monarchy.
The looming disasters of the proxy world war in Ukraine, climate change, and failed governments that can’t keep their leaders from getting infected with COVID, all portend the collapse and fall of the West Empire. Only a restoration of government by and for the people, will allow civilization in Europe and North America to continue.
In the USA, closing the revolving door, end corporations buying politicians, and the breakup of monopolies especially in the media, are all required.
Eric Anderson
“The problem now is that a fast move away from natural gas, oil and coals isn’t possible.”
Is this a problem?
Or is it possibility not yet realized, Ian?
China and Russia are investing in the mistakes the west made in the past, only to remake themselves in the image of the western world’s mistakes.
Whereas, while the western world may not know it yet, the evolving global alignment is going to force the western world to eco-socially evolve. I think if we all understand anything it’s that human’s don’t evolve without the motivation brought about by pain. Necessity as the mother of invention applies not only to inventing light bulbs and computers. But to reinventing society as well.
Which is not to say the west won’t tear this world to shreds in it’s quest to hang on to it’s riches. But, as you’ve said before, it’s unlikely to be an extinction level event. It’ll just take out billions of us.
I seem to find hope in strange places these days. But, if global anarchy and mass famine are what it takes for humanity to finally understand the “limits to growth” that capitalists refuse to address, and to finally evolve an ethic that incorporates mutual aid and eco-consciousness, then I’ll take it. And I’ll be the first one teaching my son that these are the wages of sin.
“The problem” is greed, sloth, and mammon. The solution is the elimination if their standard bearers.
Stirling S Newberry
Off-topic: The Fermi Paradox
It is interesting how a problem that is so obvious is formed that most people can grasp in is a problem, but they refused to bring to bear things like algebra that can answer it. This includes people who can express the problem. One example is the Fermi Paradox. The simplest fact of the matter can be summarized as follows: “Where is everyone?”
That is, life is abundant so why is it so rare? The answer is that while amino acids are quite common the next few steps are not. Getting DNA is extremely hard. This is where the moon comes in. The chances of having a moon of the right size are extraordinarily small. We know that this is a one-way, but not the only one, that works out. But it does mean that the odds are small.
This is further complicated by the sun – it is large enough to be one of the first stars to have life. We need Iodine. Iodine is produced, largely, in supernovas. This means the 3rd generation stars of the right size are very low in number. We are also in a tiny galaxy – large enough to have 1, but not more. They are large galaxies – that have a chance to have more than one. This means that they have problems that we do have – such as the annihilation problem. (Simply put: Keep your head down or a race that is just slightly ahead of you while pulling you up by the roots.)
Simply put: we are in a small galaxy with only a low number of species because, at this time, we are quite quick in developing and do not have enough competition.
Side note: COVID is a bitch because one is slow while one has it. I speak as one who knows.
someofparts
I’ve stopped asking my friends about their travels. They have been enjoying trips to places like Paris, Malta and Croatia. They will think I am making fun of them. I probably am.
Trinity
“It appears that EU leaders were comfortable as subjects of the United States: they didn’t want to challenge it.”
Or more likely (imho) they are getting paid the same as (all) the leaders on this side of the Atlantic. It’s a club, and we don’t belong to it. All these years I’ve watched as GB mirrored what’s been happening here, they are just a little bit slower. But their checklists align almost perfectly. But like you said earlier, Ian, the GB leaders may think they are dining with the bigwigs, it in reality they are seated “below the salt”.
And both sides are now going after the pot of gold at the end of the rainbow. For the former GB, it’s the NHS. For the US, it’s social security and Medicare. They are sick in mind and body. These people have never met a large fund of money (like a state retirement system) or a big budget line item they don’t covet, and wish to divert into their own pockets. Somewhere, there is a list of these types of resources along with plans to convert/subvert/divert them, and they are checking them off the list as they advance the line.
Like any addict, they will have to hit the very bottom before they can ever admit they have a problem. As Eric said, it’s already beginning to unravel, and more unraveling is expected (and somewhat desired if it will end their reign of terror). But we aren’t talking about them just hanging on to their riches. Like the Borg, they will never stop assimilating what doesn’t belong to them until an unmovable something stops them.
someofparts
I spotted a story that reported that the U.S. is having trouble building the nuclear submarines they persuaded the Australians to buy from them. This is because they are experiencing massive cost overruns and also having trouble getting various critical components that are needed.
My hope is that this is how the demise of the U.S. economy will happen. It will just become clear that the country does not have access to the resources it needs to make nuclear submarines or F-35s anymore.
If they come after Social Security I will be obliged to move to a cardboard box, so probably won’t be able to post here anymore, but that is still better than nuclear winter.
fermi la bouche
Also, where is not just everyone but everything. It’s all here. And there. And everywhere. We just can’t comprehend it. Our limited capacity prevents us from seeing what is quite literally right before our eyes. It’s in our space and in our face and we’re entirely clueless to its presence and yet we think we’re so fucking special and superior.
Librarian Guy
A thorough & cogent piece by Ian, as usual. I thought the key phrase was “If Europe wants to be anything but a satrapy–” Well, I think we all recognize that the Euro-elites are all 100% onboard with this, & any US spitting in their face (Nuland on the phone stating “Fuck the EU”) matters not a whit. And so far their populations have chosen to go along with the program, but we will see if the Russian energy continues to flow west by winter or if the majority are freezing, hungry and miserable, if there is any revolt by the passive vox populi. As to leadership of the NeoLibs “rethink[ing] their ideology,” I assume we all know the likelihood of that is Nil, TINA rules, without ever examining choices or rethinking anything as long as the money flows upward to the connected folks, and the plebs are increasingly desperate, unhealthy and impoverished (as Neolib ideology dictates they deserve to be). Anyway, even the dumbest idea can occur randomly (broken clock metaphor, right twice daily) so I guess in roughly one Friedman Unit or less we will see if the “Western” Status Quo reigns as unchallenged as it has for the entire 21st Century. I am one among the minority in the fragmenting US who is hopeful for the end of a unipolar world which seems to be dawning.
different clue
If the PolangGov and the HungaryGov decide that sovereign freedom is more important than chiseling money out of the EU is, then they will formally resign from the EU. This will leave the EU powers deciding if they want to launch a Special Military Operation against Poland and Hungary to overthrow their governments and install EU puppet government over those two countries to force them back into the EU or not.
In this scenario, if the EU decided not to militarily reconquer and occupy and re-EU-ify Poland and Hungary, then the other EU countries and peoples would see that resignation from the EU is indeed possible and permitted. And they could decide whether they want to resign from the EU, one country at a time, or not.
Right now the EU looks as strongly chained and welded together ad the USSR did at its height. But when things in USSR reached a total unbearability threshhold, some clever leaders unchained and unwelded the constituent Republics apart.
Since the EU leaders and elites still believe in their EU in a way that even the USSR communists had stopped believing in USSR Communism, they would put up a more violent resistance. How counterviolent the freedom-seeking peoples of Europe would get in response to Internal Imperial EU violence would remain to be seen, in that scenario.
Feral Finster
The problem is that the political class in Europe cannot imagine any orientation other than pro-Brussels in domestic policy and slavish Atlanticists in foreign policy.
Even suggesting any other position would be unthinkable, the equivalent of standing up during a High Papal Mass to loudly ask the assembled celebrants and faithful who just farted and would the culprit please identify him- or herself.