Global News Journal

from Jeremy Gaunt:

Greeks on the street

Greeks smashing windows and setting fire to shops and banks in a fury of opposition to yet more austerity is gripping.  But it is hardly unique. A few years ago there were similar scenes for weeks after police shot a 15-year old schoolboy.  And back when I lived there, U.S. President Bill Clinton was treated to a similar welcome -- mainly because of his military assault on Serbia (a fellow Christian Orthodox nation) during the Kosovo conflict.

There are doubtless degrees. The latest level of destruction was the worst since widespread riots in 2008 -- and austerity being imposed on Greeks is very painful. But it is worth noting that there are two underlying elements than make such uprisings more common in Greece than elsewhere.

The first is a division in Greek society that goes back to at least the end of the second world war. The civil war that followed the end of the German occupation was brutal and split the country between those wanting western free market democracy and those favouring Soviet-style communism. This carried though into the 1967-74 junta.

The second element is the role of outsiders on Greek history. The Civil War brought in western intervention and the junta got U.S. support -- to the deep-seated bitterness of those on the other side. Going back further -- and Greeks have long historic memories -- there are Persians, crusaders, Nazi Germans and the particularly hated Ottomans trying to make Greeks be something other than Greek. Here is a feature on it.

Add to that mix the Washington-based International Monetary Fund, the Frankfurt-based European Central Bank, the Brussels-based European Commission, derisive artilces in British and German tabloids and a drumbeat of tough talk from Berlin.

This is what happens when Greeks get their backs up about foreigners telling them what to do.

Waiting for Europe’s “appropriate response”

Will the euro zone finally act decisively?

Investors are hoping for something big from European leaders at the EU summit on Oct. 23 and of the Group of 20 on Nov. 3. But they also know the 17 nations of the euro have a habit of offering delayed, half-hearted rescues that have cost them credibility.

So there’s been a lot of “urging” and “warning” in Brussels lately — politicians and central bankers have all been demanding Europe act as international alarm grows that its sovereign debt problems may drag the world into recession. “Further delays are only aggravating the situation,” said European Central Bank President Jean-Claude Trichet on Tuesday in his last appearance at the European Parliament, before he hands over the post to Mario Draghi on Nov. 1.

A day earlier, Germany’s Deputy Finance Minister, Joerg Asmussen, at the parliament to promote his candidacy to join the ECB‘s board, made his call, saying “cooperation has to be increased,” across the euro members, divided as to who should pay to rescue the heavily indebted nations of southern Europe. “I want to see a solution for debt sustainability for Greece,” Asmussen said. So do so many others, especially Greek Prime Minister George Papandreou, who in Brussels on Thursday said it was a “crucial element to make the necessary decisions concerning Greece.”

The European Roundtable of Industrialists, a business lobby of multinationals ranging from French car maker Renault to Spain’s Telefonica, has also come through Brussels to make its point. The group’s head, Leif Johansson, who is also chairman of Swedish phone maker Ericsson, warned that if European leaders fail to act, businesses could see a repeat of the liquidity freeze that followed the collapse of U.S. investment bank Lehman Brothers.

“The worst element of the 2008/2009 crisis was when liquidity froze,” he said. “The worst scenario we have right now is that that could happen again … and there is a real downside risk.” 

The Oct. 23 summit is being billed as a make-or-break event where Germany and France, the main powers in the euro zone, must come up with the solutions investors want. A meeting last Sunday between German Chancellor Angela Merkel and French President Nicholas Sarkozy, and their promise of a comprehensive strategy, suggests there will be a serious attempt to put forward a framework to try to resolve the crisis.

EU delivers its own “State of the Union” address

The European Union talks frequently about wanting to be a bigger player in the world, about making its political influence match its economic weight and the need to stand shoulder-to-shoulder with the United States.

And at least in one respect it can now say it’s America’s equal – both have a State of the Union address.

Jose Manuel Barroso, the president of the European Commission, delivered his inaugural State of the Union speech to the European Parliament on Tuesday, a sweeping assessment of where the bloc of 27 countries stands and what it needs to do to be better in the future, tapping a similar vein to President Barack Obama’s State of the Union address to Congress in January.

But beyond the matching titles, and some common themes, there were few similarities, at least from a rhetorical point of view.

Barroso’s 4,300-word discourse was heavy on EU-speak, the need for the Union’s member states to stand closely together, work on “economic governance” and build “strategic partnerships” for the future.  It was hardly a grand rallying cry to the glories of greater European unity.

Compare for example this passage from early in Barroso’s address, assessing Europe’s response to the economic crisis, to a similar passage from Obama’s State of the Union.

“As I look back at how we have reacted, I believe that we have withstood the test,” said Barroso. “We have provided many of the answers needed — on financial assistance to member states facing exceptional circumstances, on economic governance, on financial regulation, on growth and jobs. And we have been able to build a base camp from which to modernise our economies. Europe has shown it will stand up and be counted.”

Whatever happened to Europe’s debt crisis?

If people stop commenting on the financial crisis, does it still exist?

A month ago, Europe was in the throes of fretting about Greece’s debt problems and whether they were going to spill over to Portugal and Spain, bringing down the euro and a decade of monetary union with it. At the same time there was intense anxiety about impending results from stress tests on nearly 100 European banks.

Every day — and sometimes several times a day – European Union officials, ministers, leaders or central bank governors would say something about the crisis, providing more fodder for frazzled financial markets to make another round of cliff-hanging calls over whether things were getting better or worse.

The market gyrations would prompt more questioning of officials, adding more verbal fuel to the fire, keeping the merry-go-round twirling.

Of course, decisions were also being taken that helped calm fevered brows — Greece took steps to cut government spending, the stress test results largely proved reassuring, and Portugal and Spain financed their debts through the markets without too much disruption.

But mostly, officials just stopped commenting on the crisis. Why? In large part because European went on holiday.

The European Union effectively shuts down in August — the Commission holds no briefings, the European Parliament is in recess and there are no leaders’ summits. This year most headed for the beaches in the last week of July.

Religious leaders and the EU take tentative first steps

Top European Union officials held talks this week with religious leaders, part of a policy of holding consultations with religious groups that was enshrined in the EU’s Lisbon reform treaty, which came into force last December. But not everyone supports the move.   More than two dozen Christian, Jewish and Muslim leaders — joined by a representative each from the Hindu and Sikh communities — met  the presidents of the European Parliament, European Commission and European Council on Monday to discuss how to fight poverty and social exclusion.

It was the the sixth such consultation since 2005, but the first to take place in the context of the Lisbon treaty, the EU’s latest collective agreement.  Article 17 of the treaty commits the EU to maintaining “an open, transparent and regular dialogue with … churches and (non-confessional and philosophical) organisations”.

But opponents of the guidance say that because many Europeans are secular and an increasing number practise non-Christian religions, churches should not have special rights.

“Leaders need to respect the separation between church and state,” said Jean de Brueker, deputy secretary general of the European Humanist Federation, which advocates more secularism in Europe. De Brueker’s organisation says separate consultation agreements should be limited to elected officials and those with recognised special expertise.     Herman Van Rompuy, president of the European Council, said the EU was a secular organisation but spoke about the moral significance of the 27-country bloc, hinting at the need for spiritual and religious input.      “The European Union has to be a union of values. That is our added value in the world. That is the soft power of Europe in the world,” he told reporters.     Cardinal Stanislaw Dziwisz of Poland, who spent decades in the Vatican as private secretary to Pope John Paul II — who played a subtle but intimate role in late Soviet politics — has spoken in favour of Article 17.     “I believe there is a need for such consultations with churches so as not to make mistakes on moral or ethical issues, for the benefit of societies,” Dziwisz told Reuters in December. “Let’s not forget that religion is also a great force that creates cultures and societies. It cannot be bypassed.”     The European Parliament will meet Catholic, Protestant and Orthodox leaders on Sept. 30 to discuss how to implement Article 17, European Parliament President Jerzy Buzek said.

One way or another, debate over what role the Church, and by extension churches, can play in engaging with the European Union is only likely to intensify. The EU’s hopes of ‘reaching out’ to religious communities may very well end up drawing it deeper into a complex, centuries-old debate.

Life no paradise in EU’s outer regions

Times are hard in distant corners of the European Union, even when the sun is shining and the euro zone’s debt problems are thousands of miles away.

Leaders of nine regions on the edges of the EU are asking the rest of the 27-country bloc to pay more attention to their needs and shape investment policies better to their problems, exacerbated in some cases by the global economic crisis.

“Poverty in the sunshine is no easier than poverty in the snow”, said Frantz Gumbs, leader of the small French community on the Caribbean island of Saint Martin.

“We’re not asking for more and more”, he told a conference in Brussels. “We’re asking for better.”

The voices of territories as far away as the Indian Ocean and South America are rarely heard at the heart of the EU. So leaders from these regions, the most distant of which was the island of Reunion, a French territory about 9,000 km (5,640 miles) from Brussels, took the chance offered by the first Forum for Outermost Europe.

The leaders said EU support should be better tailored to their specific needs and their efforts to strengthen their traditional economic sectors, boost competitiveness and develop entrepreneurship.

The French community of Saint Martin makes up just under half of the about 75,000 population of the island, half of which is French and half of which is part of the Netherlands’ Antilles.

Who do you call to speak to Europe?

Who do you call when you want to speak to Europe? The question, long attributed to Henry Kissinger, has yet to be answered convincingly by the 27-country European Union.

Six months ago, European Commission President Jose Manuel Barroso told a news conference the person to call on foreign policy issues was Catherine Ashton, who had just been chosen as the European Union’s foreign affairs chief.  The “so-called Kissinger issue is now solved”, he said.

Ashton reinforced that view on Monday by suggesting she was the person to call if Iran wanted to discuss the latest diplomatic moves on its nuclear programme. “They have my phone number,” she said.

But Barroso was more vague at the news conference last November when asked whom U.S. President Barack Obama should call if he wanted to speak to the EU. He pointed out that the EU was not one country, like the United States, China or Russia — implying they each had one clear leader. He seemed to be saying that the person you have to call depends on circumstances or the nature of the problem a foreign leader wishes to discuss.

So who did Obama call when he wanted to discuss the debt crisis threatening the group of 16 EU states that use the euro?

It wasn’t Ashton — as a Briton, she is not from a euro zone country and anyway this was a call about economics, which is not in her brief.

It wasn’t Herman Van Rompuy either, even though he too could stake a claim to be the face of Europe as the bloc’s first full-time president.

Deja vu? EU ministers meet on Greece

How many meetings does it take for the European Union to solve a problem? Quite a few — at least in the case of Greece’s debt crisis and preventing it from spreading to other euro zone countries.

There was a definite sense of “deja vu” when the bloc’s 27 finance ministers met on Sunday to approve measures aimed at ring-fencing Greece’s debt problems.

They were pretty much tackling the same problems as the leaders of the 16-country euro zone had dealt with at talks on Friday. The leaders had met to approve what Eurogroup finance ministers agreed five days before at talks that were called to build on agreements at a series of EU and euro zone meetings this year.

Securing agreement among all 16 euro zone countries or all 27 EU member states has never been easy but it is particularly hard for governments to make deals during an economic downturn or when they face domestic opposition to a bailout – as is true in Germany’s  case.

What has the effect of all these meetings been on financial markets? By Sunday evening, not too much, although  IMF and EU formal approval for a 110 euro ($148 billion)  loan package  for Greece over three years did at least help push up the  euro.

Previous EU action this year has failed to calm financial markets and ended up undermining the EU’s credibility.

Searching for silver in Greece’s storm clouds

Greece and the euro zone are still very much in the midst of a debt and deficit storm, with not just Athens but possibly Portugal and Spain at risk of being swept up in the maelstrom.

But that hasn’t stopped economists and political analysts looking for a silver lining in this unprecedented meltdown.

One positive is the impact the uncertainty is having on the euro, which has weakened sharply against the dollar and the British pound this year. That may not be very good for those in the United States or Britain holding euro-denominated assets, but it’s good for European exporters, whose goods become relatively less expensive for importers.

As Jennifer McKeown, a senior economist with Capital Economics, pointed out in a research note on Thursday, euro zone export orders are sharply up (by some counts they are now the highest in 10 years), while in April, euro zone manufacturing expanded at its fastest rate since November 2006, according to Markit.

That’s clearly a positive for the euro zone. The EU is the world’s largest trading bloc by value and exports are a key component of growth, particularly for the major economies such as Germany, France and Italy. Accountancy firm Ernst & Young said in a recent report that it expected net trade to contribute 0.7 percentage points to euro zone growth in 2010 — thereby accounting for three-quarters of the rise in overall GDP.

It is therefore perhaps not so surprising that economic and business sentiment in the euro zone rose strongly in April, despite the chaos in Greece and the volatility in financial markets across the region. 

But there is also a broader positive shakeout that could ensue from this crisis. It may take several years — at best — but economists and political analysts think it will force profound structural adjustments in several EU economies, including Greece, Portugal, Spain and possibly Italy.

EU “maximises its bottom-up cohesion going forward”

All institutions have their gibberish and jargon, but the European Union really does take the biscuit sometimes.

Whether it’s endless acronyms that tumble out of press officers’ mouths without the faintest irony, or stock phrases that ministers, commissioners and assorted lower-level officials just can’t stop themselves from using, the EU and its institutions have given rise to a plethora of empty or confusing verbiage.

At a briefing by the European Defence Agency on the sidelines of a meeting of European foreign ministers in Luxembourg on Monday — known in the lingo as a GAC/FAC — an official produced the following phrase to describe efforts to create a new security body: “We want to adopt a pragmatic, output-oriented, bottom-up approach.”

Having a “bottom-up approach” is currently de rigueur, with former British Prime Minister Tony Blair, now a Middle East envoy, repeatedly using the phrase in recent weeks to describe efforts to build-up Palestinian institutions and the economy. Catherine Ashton, the EU’s high representative for foreign affairs, likes to use it regularly too.

In fact, Ashton has several phrases she tends to fall back on, including a frequent wish to “move forward on the ground”. At one press conference last month she declared: “The watchwords ought to be: maximizing synergies, avoiding heavy procedures and strengthening our collective impact on the ground.”

Acronyms are another favourite. One page of the 15 pages of conclusions from the foreign ministers’ meeting on Monday included the following series of acronyms: EUJUST LEX, EUPOL COPPS, EUBAM, AMISOM and SHADE, the last of which stands for Shared Awareness and Deconfliction.

A press officer at the same gathering expected to be understood when he said “the CSDP conclusions will reaffirm the EUTM and support for the TFG”, which essentially translates as: “The common security and defence policy conclusions will reaffirm support for the European Union training mission (in Somalia) and the Transitional Federal Government of Somalia”.