Fixing Europe

Now that August is nearly over, the European giant tries to shake off its lethargy and get down to continue tackling what’s ailing it. It has not been an easy summer for Europe. First the many terrorist attacks in France and in Germany. Now this earthquak

ngrima@independent.com.mt

The talks around Europe have already begun. There was the largely symbolic meeting between Merkel, Hollande and Renzi (with Italy a poor substitute for Britain, if you ask me) at Ventotene. Next, Merkel took upon herself a punishing round of talks with 13 member states (but not Malta, nor Cyprus). All this is was in preparation for the coming European Council which will be held in Bratislava later on in September.

The cooling off is mutual, it seems. George Vella, not Joseph Muscat, took part in a PES preparatory meeting last week.

Ostensibly, the meetings try to set Europe’s course following Brexit. It is not just a matter of deciding what the EU’s response to Brexit ought to be. Brexit, as we all remember, had multiple levels. On the face of it, it pulled Britain away from EU control but underneath it was about immigration. Basically, however, Brexit undermined and rebelled against the most important principles of the EU – especially solidarity between the peoples of Europe. The Brexiteers just did not want to hear about solidarity when this was translated into thousands from East Europe migrating to Britain and partaking of the British social security system.

The poor European migrants were targeted when Britain, London especially, houses more poor vagrants from all over the world. No Brexit for them. Nor are they allowed in Britain out of solidarity.

But the immediate task facing the EU is quite different from coping with the British exit. We may think that, just because we have not been hearing or reading a lot about it, Europe’s financial crisis is over. It is and it isn’t.

It is because countries like Spain, Ireland, etc. have emerged from the depths of recession and are seeing some kind of growth. It isn’t because countries like France and Italy, etc., are still deep in recession or their growth has been stunted. Italy is now Europe’s basket case with a heavy task to undertake – restructuring the many troubled banks. And then there is Greece. A year and a month ago Greece was on the verge of being kicked out of the Eurozone. Then in one long night, it accepted everything that Europe threw at it as a result of which its economy has been kept on life-support.

Since July 2015, Greece has implemented some of the reforms it signed up for but it has delayed others. The rest of Europe has relented in the face of Greek successive non-implementation as if it does not have the heart to kick Greece out.

Still, the Euro-system lurches on. Greece has not had its Grexit; the euro has survived when many thought it was doomed. Each successive meeting of European leaders (and also those of finance ministers) ends with an announcement that a fix has been found, a new structure has been added on, and yet the deep fundamental issues that undermine the euro have not yet been tackled.

I have come to this conclusion after reading a book by the former Greek Finance Minister, Yanis Varoufakis, entitled And the weak suffer what they must? (Bodley Head).

Without reading the book, I would have thought he would be bitter mostly against his antagonist in so many Eurozone meetings – German Finance Minister Wolfgang Schauble. He is, but that’s not all.

What bedevilled the meetings was history – the not so recent history of Nazi occupation and the Geek demands for reparations that were never paid. Nearer our times, German liberals like Willy Brandt (and Austrian Kreisky) supported the democrat Greeks in their rebellion against the colonels.

But that is not the target of the book (although more about this later). The real villain of the book is Richard Nixon and his Treasury Secretary John Connally and Under-Secretary Paul Volcker. On 15 August 1971 they told an unsuspecting Europe that the US would be dismantling the global monetary system it had created and maintained for many years. In effect, it was pulling out the rug from under Europe’s feet.

Europe was in a way to blame for this, for the preceding years had shown many times that Europe was coming