Friday, June 24, 2016

Who Eventually Won WWII in Europe? (A Reflection/Thought Experiment on Brexit)


Who eventually won WWII in Europe? Germany.


Allow this not very original speculation: Brexit means that Germany is confirmed as the dominant European power. 
Sure, Germany lost WWII (and WWI), but (seen from a long-term historical perspective) this was a temporary setback for an economically developed, highly skilled/educated/cultivated area in the center of Europe, despite its not being particularly charming and burdened with its despicable Nazi past. 
Today, 70 years after the end of WWII, the European spaces on the periphery/geographical extremities of the Old World (Russia/USSR, England/U.K.) are no longer in a military or economic position to challenge, as they did as 20th century empires, a German domineering presence on the continent of Europe. 
Russia lost its important presence in the Eurasian space, in large part thanks to its "Rusexit" from the USSR; the other country, the U.K., is now losing its important presence in the Euro space, thanks to its Brexit from the EU.
Who's going to be the boss in 21th-century continental Europe? Ask Angela Merkel.
 Consider wild generalizations on how European history evolved in modern times:

--A few decades after the end of WWII -- when Germany was reconstructed (thanks to USA assistance and German "hard work") -- a broken-down USSR (the 20th century version of the Russian Empire) lost the Cold War, much to Germany's territorial and economic advantage (e.g., the reunification of Germany).

--The current economic weakness of southern and eastern Europe assures Germany's powerhouse role within the EU; it can call the financial if not political shots.

--France (an "empire" until 1870, when it was defeated by Bismarck's Prussia, which became the German Reich) is no longer a competitor to Germany (since at least the defeat of Napoleon) for dominance in Europe, despite the French having "won," thanks to their Anglo-Saxon allies, WWI and WWII against Germany.

--And now the U.K. leaves the E.U., not only assuring that Germany is the one dominant power in Europe, but the gateway to this continent for the U.S. and rising powers (China, India) peddling their products/services.

--In the imperial struggles that marked much of 20th century Europe -- brutal survival-of-the-fittest conflicts (often military) among the British, German, and Russian empires that had little to do with Wilsonian calls for making "the word safe for democracy" -- the eventual 21st century "winner" among these former empires seems to be (at least for now) Germany.

--BTW, on the way to its 21st century success, during the Cold War (and today) Germany (to paraphrase the French president Pompidou) had/has -- instead of A-bombs (a weapon that England, France and Russia developed at great cost during the Cold War) the deustchmark, arguably a far better tool at gaining global influence than nukes that threaten to blow up the world.

Good news? I'll let the reader decide. As for me, je constate.

Regarding the "space" that countries (are countries as entities becoming an anachronism?) may wish to control in the 21st century -- space is increasingly "digital," in cyberpace, stripped of a specific physical "location," among the computer elite.

But most people on planet earth, even with a cell phone, still live with their feet on the "real-world" ground.

 I suspect that much of the reaction against "globalization" in Europe and the USA have something to do with that -- that we, ordinary people, are not living that well in our cyberworld (although doesn't everyone love her/his cell-phone?)

 P.S. The influx of Syrian/ME refugees to Germany (with its low birth rate) is not necessarily a negative from a German economic perspective; it replenishes its potential "cheap" labor supply, despite the social tensions caused by immigration in a country not always known for its tolerance of "non-Germans."

But if the German economy goes sour, watch out ...

Added Notes
A large proportion of Britain’s internal regulations are based on E.U. rules and will need to be revised. At the same time, E.U. countries are Britain’s primary trading partners, and there will be innumerable questions about the terms of Britain’s participation in the single European market. Germany and France are not likely to be charitable, if only to dissuade euroskeptics on the Continent from following Britain’s lead. And every step of the negotiations will require agreement from 27 fractious E.U. member states.
***
As world markets tumbled after the United Kingdom's vote to leave the European Union, the London Stock Exchange Group announced on Friday it would push forward with its planned $30 billion merger with German exchange Deutsche Börse.

In a joint statement both exchanges said that the merger was "not conditional on the outcome of the referendum," and that 'Brexit' does not "impact the compelling strategic rationale of the merger." The boards say the merger will result broaden the exchange's global reach and distribution network through Europe, Asia and the Americas regardless of a 'Brexit'.

Both exchanges recommend shareholders approve the merger. London Stock Exchange shareholders will vote on July 4, while Deutsche Börse's holders can tender their shares on July 12.

Under the agreement Deutsche Börse shareholders would control 54.4% of the combined group, with Deutsche Börse's CEO remaining in charge.

Not everyone favors the agreement, particularly in light of today's vote. France's most powerful business lobby, the AFEP, called on the EU to block the merger over fears that French companies will leave to the London or Frankfurt exchanges.

"If the French groups leave Paris, France will lose much of its sovereignty in the supervision of its major groups in favor of Germany and England," said Pierre Pringuet, president of the AFEP, according to French newspaper Les Echos in comments made earlier this week. The AFEP prefers companies use rival stock exchange Euronext, which handles the French, Dutch, Belgian and Portuguese stock markets.

AFEP represents many of France's largest companies including Air France, L’Oréal, Michelin, Axa and Renault.

"We think the immediate ramifications would be that it does decrease the chances that the deals happens," says Eric Compton, an equity analyst at Morningstar. Compton notes the political and regulatory implications the deal faces, particularly with regards to the combined entity's headquarters. It is unlikely German regulators would now approve the merger with a headquarters in London, as was originally planned.

"We don't think that German regulators are going to like having a non-EU entity being in charge of something that's (so) integral to the European Union financial markets."

As with most British stocks, the London Stock Exchange Group had a rough Friday, tumbling 10.55%. Deutsche Börse didn't fare much better, falling 9.26% in Friday trading. The Euronext was down 3.92%.
***

Alison Smale, "E.U. Leaders Push for a Speedy Start to Britain’s Exit," New York Times
The departure of Britain will increase the prominence of Germany, already Europe’s most prosperous and populous country.
***

Jim Yardey et al, "Britain Rattles Postwar Order and Its Place as Pillar of Stability," New York Times
“Britain leaving the E.U. now poses a challenge for Germany,” said Nicholas Burns, a former top American diplomat who now teaches at the Harvard Kennedy School. “It will need to provide even greater leadership to keep Europe united and moving forward.”
Germany, though, has been reluctant to play a diplomatic and military role commensurate with its economic heft. Ever mindful of its Nazi past, and its four decades as a divided country, Germany often wraps its policies in the mantle of Europe and has developed a pacifist instinct that is a poor fit with the expectations that it must now lead.
“There is no point beating about the bush,” Ms. Merkel said Friday. Europe has reached “a turning point,” and “more and more often, we encounter basic doubts” about ever-­greater union.
*** 
Peter Altmaier




***

Tom DiChristopher, "US would look to Germany for leadership after Brexit, former ambassador says," NBC

***

Frank-Walter Steinmeier, "Germany’s New Global Role," Foreign Affairs
***

“'A British exit from the E.U. would be a blow to U.S. influence in Europe,' said James Sherr, a senior associate fellow at Chatham House. It would also strengthen the latent anti-American sentiments in Germany."
***

Lars Hoffmann, "Germany and Poland Join Forces in Submarines," Defense News

***

Grabiele Steinhauser, "English Loses Currency as Europe’s Lingua Franca After Brexit Vote," Wall Street Journal:
[S]ome officials working in the institutions worry that the departure of the U.K., and the expected sidelining of British EU officials, will mean more meetings will be held in French or German—excluding those who have focused on English as their main foreign language. Others pointed out that focusing on French and German will further entrench the power of Berlin and Paris, excluding countries in the EU’s north, south and east that are already losing a political ally.
*** 

Jon Vinocur, "A Far-Right Headache for Angela Merkel," Wall Street Journal
[A] serious 2017 election problem for Chancellor Angela Merkel: the arrival in the Bundestag of a rising right-wing nationalist force clearly more assertive than the Germany First element within her own Christian Democrats. Added to the AfD’s populist assets, alongside its hard-lines on immigration and the future of the EU, is an anti-American tonality like the one that helped Gerhard Schröder beat the Christian Democrats in 2002.
[I]t’s both instructive and appalling to consider the message that Wolfgang Gedeon, the legislator still awaiting judgment, used to win election on the AfD ticket in 2015. According to a German report, Mr. Gedeon’s campaign material blared the slogan, “Vote how you really think.”
In Germany, whose shakiness accelerates Europe’s in this bad year, those words now constitute a broader and loaded proposal.
*** 

Sam Shead, "A van is driving around London to try to get startups to move to Berlin," businessinsider.com (via WNB):
The advert appears to have been created by Freie Demokraten (FDP), or the Free Democratic Party — a liberal and classical liberal political party in Germany.
image from article

Ian Buruma, "The End of the Anglo-­American Order," Nov. 29, 2016 New York Times
Germany, too, once thought it was the exceptional nation. This ended in a
worldwide catastrophe. The Germans learned their lesson. They no longer wanted to
be exceptional in any way, which is why they were so keen to be embedded in a
unified Europe. The last thing Germans wanted was to lead other countries,
especially in any military sense. This is the way Germany’s neighbors wished it as
well. Pax Americana seemed vastly preferable to a revival of German exceptionalism.
I still think so. But looking once more at that photograph of the Donald and Farage,
baring their teeth in glee, thumbs held high, with the gold from the elevator door
glinting in their hair, I wonder whether Germany might not be compelled to
question a lesson it learned a little too well.


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