My plan to revive Europe can succeed where Macron and Piketty failed

Under my Green New Deal, €500bn a year can be created without raising taxes – and it may tempt Britain back to the fold writes Yanis Varoufakis in The Guardian

 

‘Historians will mark Emmanuel Macron’s failed reform agenda as a turning point in the EU, perhaps one that is more significant than Brexit.’ Photograph: François Lenoir/Reuters


If Brexit demonstrates that leaving the EU is not the walk in the park that Eurosceptics promised, Emmanuel Macron’s current predicament proves that blind European loyalism is, similarly, untenable. The reason is that the EU’s architecture is equally difficult to deconstruct, sustain and reform.

While Britain’s political class is, rightly, in the spotlight for having made a mess of Brexit, the EU’s establishment is in a similar bind over its colossal failure to civilise the eurozone – with the rise of the xenophobic right the hideous result. 

Macron was the European establishment’s last hope. As a presidential candidate, he explicitly recognised that “if we don’t move forward, we are deciding the dismantling of the eurozone”, the penultimate step before dismantling of the EU itself. Never shy of offering details, Macron defined a minimalist reform agenda for saving the European project: a common bank deposit insurance scheme (to end the chronic doom loop between insolvent banks and states); a well-funded common treasury (to fund pan-European investment and unemployment benefits); and a hybrid parliament (comprising national and European members of parliament to lend democratic legitimacy to all of the above).

Since his election, the French president has attempted a two-phase strategy: “Germanise” France’s labour market and national budget (essentially making it easier for employers to fire workers while ushering in additional austerity) so that, in the second phase, he might convince Angela Merkel to persuade the German political class to sign up to his minimalist eurozone reform agenda. It was a spectacular miscalculation – perhaps greater than Theresa May’s error in accepting the EU’s two-phase approach to Brexit negotiations.

When Berlin gets what it wants in the first phase of any negotiation, German chancellors then prove either unwilling or incapable of conceding anything of substance in the second phase. Thus, just like May ending up with nothing tangible in the second phase (the political declaration) by which to compensate her constituents for everything she gave up in the first phase (the withdrawal agreement), so Macron saw his eurozone reform agenda evaporate once he had attempted to Germanise France’s labour and national budget. The subsequent fall from grace, at the hands of the offspring of his austerity drive – the gilets jaunes movement – was inevitable.


The great advantage of our Green New Deal is we are taking a leaf out of Franklin Roosevelt’s original New Deal in the 1930s

Historians will mark Macron’s failure as a turning point in the EU, perhaps one that is more significant than Brexit: it puts an end to the French ambition for a fiscal union with Germany. We can already see the decline of this French reformist ambition in the shape of the latest manifesto for saving Europe by the economist Thomas Piketty and his supporters – published this week. Professor Piketty has been active in producing eurozone reform agendas for a number of years – an earlier manifesto was produced in 2014. It is, therefore, interesting to observe the effect of recent European developments on his proposals. 

In 2014, Piketty put forward three main proposals: a common eurozone budget funded by harmonised corporate taxes to be transferred to poorer countries in the form of investment, research and social spending; the pooling of public debt, which would mean the likes of Germany and Holland helping Italy, Greece and others in a similar situation to bring down their debt; and a hybrid parliamentary chamber. In short, something similar to Macron’s now shunned European agenda.

Four years later, the latest Piketty manifesto retains a hybrid parliamentary chamber, but forfeits any Europeanist ambition – all proposals for debt pooling, risk sharing and fiscal transfers have been dropped. Instead, it suggests that national governments agree to raise €800bn (or 4% of eurozone GDP) through a harmonised corporate tax rate of 37%, an increased income tax rate for the top 1%, a new wealth tax for those with more than €1m in assets, and a C02 emissions tax of €30 per tonne. This money would then be spent within each nation-state that collected it – with next to no transfers across countries. But, if national money is to be raised and spent domestically, what is the point of another supranational parliamentary chamber?

Europe is weighed down by overgrown, quasi-insolvent banks, fiscally stressed states, irate German savers crushed by negative interest rates, and whole populations immersed in permanent depression: these are all symptoms of a decade-long financial crisis that has produced a mountain of savings sitting alongside a mountain of debts. The intention of taxing the rich and the polluters to fund innovation, migrants and the green transition is admirable. But it is insufficient to tackle Europe’s particular crisis.

What Europe needs is a Green New Deal – this is what Democracy in Europe Movement 2025 – which I co-founded – and our European Spring alliance will be taking to voters in the European parliament elections next summer.

The great advantage of our Green New Deal is that we are taking a leaf out of US President Franklin Roosevelt’s original New Deal in the 1930s: our idea is to create €500bn every year in the green transition across Europe, without a euro in new taxes.

Here’s how it would work: the European Investment Bank (EIB) issues bonds of that value with the European Central Bank standing by, ready to purchase as many of them as necessary in the secondary markets. The EIB bonds will undoubtedly sell like hot cakes in a market desperate for a safe asset. Thus, the excess liquidity that keeps interest rates negative, crushing German pension funds, is soaked up and the Green New Deal is fully funded.

Once hope in a Europe of shared, green prosperity is restored, it will be possible to have the necessary debate on new pan-European taxes on C02, the rich, big tech and so on – as well as settling the democratic constitution Europe deserves.

Perhaps our Green New Deal may even create the climate for a second UK referendum, so that the people of Britain can choose to rejoin a better, fairer, greener, democratic EU.

Brexit may be the best answer to a dying eurozone

Larry Elliott in The Guardian

Staying in the EU means hitching ourselves to an undemocratic project run by and for a remote elite

 

Illustration by Ellie Foreman-Peck

The elephant in the room. Everybody knew what Mark Carney meant when he paused halfway through his regular three-monthly update on the state of the economy: the implications of Brexit.

The governor of the Bank of England did not pull any punches. He warned of a potential run on the pound and of possible problems financing the UK’s whopping balance of payments deficit. He said the Bank expected growth to be materially lower and inflation to be notably higher. Voters trust the Bank of England. They sat up and took notice. The opinion polls started to move in favour of remain. When the history of the referendum campaign is written, Carney’s may be seen as the decisive intervention.

In truth, there was more than one elephant in the room. Carney was right when he said there was a risk that the upheaval caused by Brexit could tip an already weakening economy into recession. But as elephants in the room go, this was the smaller, Indian version. The equivalent of the bigger, African elephant was the shocking state of the eurozone after the failure of the single currency experiment. This went unremarked by Carney, although it is relevant to the debate aboutEurope.

Why? Because, although Britain is likely to stay in the EU, Brexit will remain a live issue unless the eurozone can sort itself out. That means either admitting that the euro has been a terrible mistake, or going the whole hog and integrating further, with a single banking system, a Europe-wide treasury, and a democratically elected finance minister with the power to raise money in Germany and spend it in Greece. This is not going to happen any time soon, and perhaps never. Countries that joined the eurozone gave up a considerable amount of economic power when they adopted the euro, but they retained the right to raise their own taxes and make their own spending decisions.

Britain is not in the euro, for which we should all be thankful. But let’s be clear: staying in the EU means hitching the wagon to a currency zone unable to go forwards or backwards, and which will continue to struggle as a result.

The euro brought to fruition the idea of ever-closer union, a plan that dates back to the early 1950s. Lots of things considered good ideas back then are no longer considered quite so clever: system-built high-rise flats as the answer to slum housing; nuclear power to meet energy needs. Put ever-closer union in the same category as the Birmingham inner-city ring road: it seemed a good idea at the time.

Dan Atkinson and I spent the winter working on a book about the single currencycommissioned in the wake of last summer’s Greek crisis. The brief was to look at what had gone wrong from a left-of-centre perspective; to explore the widespread disquiet about the way in which a country that voted in January 2015 for an end to austerity ended up seven months later being forced to accept even deeper cuts in wages and spending.
The eurozone crisis is about more than Greece. It is about Italy, where the economy is barely any bigger now than it was when the single currency was introduced. And France, where unemployment is double the level of the UK or the US. And Finland, one of the most tech-savvy countries in Europe, where the economy is 7% smaller than it was before the start of the financial crisis. And even Germany, where an export boom and high corporate profits have been paid for by workers in the form of below-inflation pay increases.

Our investigations took us back to the last time Britain held a referendum on EU membership, when during the cabinet discussions Tony Benn warned that Britain was signing up for something that was undemocratic, deflationary and run in the interests of big business. “I can think of no body of men outside the Kremlin who have so much power without a shred of accountability for what they do,” Benn said.

Benn’s dystopian vision proved entirely accurate. When the architects of the new Europe looked to the future, they envisaged a new and better version of the United States of America. Europe would have all the good bits about the US – such as the economic dynamism, a large barrier-free market and a single currency – without any of the bad bits: the inequality, the high levels of incarceration, the poverty and the inadequate welfare safety net. 

This dream lives on. Yanis Varoufakis, the deposed finance minister of Greece, thinks the eurozone could be recast along Keynesian lines, with the rich and strong countries obliged to provide financial help to the poor and weak. Good luck with getting Germany to agree to that.
Economic policy has been relentlessly deflationary. The interests of bankers have been given a higher priority than workers’. Greece, Ireland, Portugal, Cyprus and Spain have been the laboratory mice in a continent-wide neoliberal experiment of a sort Tea Party Republicans in the US can only fantasise about.

Given the obscene level of long-term unemployment, the idea of Europe as the guardian of labour rights is laughable. The gap between the US and Europe has widened, not narrowed, since the launch of the single currency. Populist parties of both left and right are gaining in support. One left-of-centre argument against Brexit is that it would result in the breakup of the euro and by doing so set off a chain reaction that would lead to the next global crisis: a perfectly fair point. Those who fear that another recession and even higher levels of joblessness would threaten a return to the totalitarian politics of the 1930s are right to highlight the risks. Some on the left who want Brexit say that the time is not yet ripe.

The left-of-centre case for divorce is that Europe doesn’t work, is not remotely progressive and is heading for an existential crisis anyway. Last year’s threat was Grexit. This year’s threat is Brexit. Next year’s threat will be something else: Italy leaving the single currency, perhaps, or Marine Le Pen’s tilt for the French presidency.

This presents an opportunity for those who believe that the way ahead still involves closer integration. Jean Monnet, the godfather of the EU, always said that ever-closer union would be forged through crises, which is what Brexit would undoubtedly trigger.

If the polls are right, Britain seems unready to trigger this act of creative destruction and it will be left to Varoufakis to do out of office what he could not do in power: prove a different Europe is possible.

A different Europe is needed, but it is stretching credibility to imagine that the Europe of Greece and the Transatlantic Trade and Investment Partnership can easily morph into America with the nice people in charge. The eurozone is economically moribund, persists with policies that have demonstrably failed, is indifferent to democracy, is run by and for a small, self-perpetuating elite, and is slowing dying. The wrong comparison is being made. This is not the US without the electric chair; it is the USSR without the gulag.

If "Protest never changes anything"? Look at how TTIP has been derailed

Owen Jones in The Guardian

People power has taken on big business over this transatlantic stitch-up and looks like winning. We should all be inspired.

 

Illustration by Ben Jennings


For those of us who want societies run in the interests of the majority rather than unaccountable corporate interests, this era can be best defined as an uphill struggle. So when victories occur, they should be loudly trumpeted to encourage us in a wider fight against a powerful elite of big businesses, media organisations, politicians, bureaucrats and corporate-funded thinktanks.

Today is one such moment. The Transatlantic Trade Investment Partnership (TTIP) – that notorious proposed trade agreement that hands even more sweeping powers to corporate titans – lies wounded, perhaps fatally. It isn’t dead yet, but TTIP is a tangled wreckage that will be difficult to reassemble.

Doubts rise over TTIP as France threatens to block EU-US deal



Those of us who campaigned against TTIP – not least fellow Guardian columnist George Monbiot – were dismissed as scaremongering. We said that TTIP would lead to a race to the bottom on everything from environmental to consumer protections, forcing us down to the lower level that exists in the United States. We warned that it would undermine our democracy and sovereignty, enabling corporate interests to use secret courts to block policies that they did not like.

Scaremongering, we were told. But hundreds of leaked documents from the negotiations reveal, in some ways, that the reality is worse – and now the French government has been forced to suggest it may block the agreement.

The documents imply that even craven European leaders believe the US demands go too far. As War on Want puts it, they show that TTIP would “open the door” to products currently banned in the EU “for public health and environmental reasons”.

As the documents reveal, there are now “irreconcilable” differences between the European Union’s and America’s positions. According to Greenpeace, “the EU position is very bad, and the US position is terrible”.

The documents show that the US is actively trying to dilute EU regulations on consumer and environmental protections. In future, for the EU to be even able to pass a regulation, it could be forced to involve both US authorities and US corporations, giving big businesses across the Atlantic the same input as those based in Europe.

With these damning revelations, the embattled French authorities have been forced to say they reject TTIP “at this stage”. President Hollande says France would refuse “the undermining of the essential principles of our agriculture, our culture, of mutual access to public markets”. And with the country’s trade representative saying that “there cannot be an agreement without France and much less against France”, TTIP currently has a bleak future indeed.

There are a number of things we learn from this, all of which should lift hopes. First, people power pays off. European politicians and bureaucrats, quite rightly, would never have imagined that a trade agreement would inspire any interest, let alone mass protests. Symptomatic of their contempt for the people they supposedly exist to serve, the negotiations over the most important aspects of the treaty were conducted in secret. Easy, then, to accuse anti-TTIP activists of “scaremongering” while revealing little of the reality publicly.

But rather than give up, activists across the continent organised. They toxified TTIP, forcing its designers on the defensive. Germany – the very heart of the European project – witnessed mass demonstrations with up to 250,000 people participating.

From London to Warsaw, from Prague to Madrid, the anti-TTIP cause has marched. Members of the European parliament have been subjected to passionate lobbying by angry citizens. Without this popular pressure, TTIP would have received little scrutiny and would surely have passed – with disastrous consequences.

Second, this is a real embarrassment to the British government. Back in 2011, David Cameron vetoed an EU treaty to supposedly defend the national interest: in fact, he was worried that it threatened Britain’s financial sector. The City of London and Britain are clearly not the same thing. But Cameron has been among the staunchest champions of TTIP. He is more than happy to undermine British sovereignty and democracy, as long as it is corporate interests who are the beneficiaries.

And so we end in the perverse situation where it is the French government, rather than our own administration, protecting our sovereignty.

And third, this has real consequences for the EU referendum debate. Rather cynically, Ukip have co-opted the TTIP argument. They have rightly argued that TTIP threatens our National Health Service – but given that their leader, Nigel Farage, has suggested abolishing the NHS in favour of private health insurance, this is the height of chutzpah.

Ukip have mocked those on the left, such as me, who back a critical remain position in the Brexit referendum over this issue. But if we were to leave the EU, not only would the social chapter and various workers’ rights be abandoned – and not replaced by our rightwing government – but Britain would end up negotiating a series of TTIP agreements. We would end up living with the consequences of TTIP, but without the remaining progressive elements of the EU.
Instead, we have seen what happens when ordinary Europeans put aside cultural and language barriers and unite. Their collective strength can achieve results. This should surely be a launchpad for a movement to build a democratic, accountable, transparent Europe governed in the interests of its citizens, not corporations. It will mean reaching across the Atlantic too.

For all President Obama’s hope-change rhetoric, his administration – which zealously promoted TTIP – has all too often championed corporate interests. However, though Bernie Sanders is unlikely to become the Democratic nominee, the incredible movement behind him shows – particularly among younger Americans – a growing desire for a different sort of US.

In the coming months, those Europeans who have campaigned against TTIP should surely reach out to their American counterparts. Even if TTIP is defeated, we still live in a world in which major corporations often have greater power than nation states: only organised movements that cross borders can have any hope of challenging this unaccountable dominance.

From tax justice to climate change, the “protest never achieves anything” brigade have been proved wrong. Here’s a potential victory to relish, and build on.

Double standards on terror: American or French lives are not more valuable than Indian lives

M J Akbar in The Times of India


After every terrorist outrage India asks a question that repeatedly withers on the dry sand of evasive clichés. How long will the apartheid of two laws for the same crime continue?

When America is stunned by 9/11, President George Bush pulverises Afghanistan, changes regime and exiles Taliban. When Paris is the scene of wanton murder, President François Hollande orders war machines to bomb regions held by ISIS in Iraq and Syria.

Neither goes into a brown study to ponder the causes of terrorism, a manipulative phrase designed specifically to provide cover for perpetrators of terrorism. Neither American nor French public opinion would accept such a pussyfoot leadership.

But when India is attacked by barbaric terrorists operating out of nearby sanctuaries, Washington and Paris, closely followed by London and Brussels, rush to Delhi to advise restraint. Why? Is an Indian life less valuable than an American or French life?

We need an answer.

There is one. I am not being unmindful of potential consequences in a nuclear-military zone, although at some point the big powers will have to grapple with the possibility of Pakistan’s tactical nuclear weapons finding their way into the hands of terrorists. The time has come for a war doctrine against terrorism that has no space for alibis.

Anyone who provides sanctuary to terrorists – whether individuals or governments – must be punished, swiftly and decisively, through collective military action and economic sanctions. There has to be a cost to hypocrisy.

We have a precedent. Perhaps predictably, it has been set by America. Washington has pursued and eliminated its terrorist enemies in half a dozen countries. The death of Osama bin Laden, who had been provided a secure home next to a large military establishment, was only the most dramatic instance.

How is Hafiz Saeed, living without a hint of remorse in Lahore, and planning more attacks while protected by state security, any less guilty? The United Nations has evidence against him, as has America. But Washington takes a nuanced view between those who attack America and those who target other nations. This is a compromise that cannot be sustained.

It is curious that a priest had clarity about Paris while politicians and pundits hedged. Pope Francis got it right when he called the ongoing conflict a ‘piecemeal third world war’. My qualification is that it merely seems piecemeal. Its impact is pervasive. Paris is attacked and every city feels instantly vulnerable. The purpose is achieved.

At this moment, conventional systems of security are still groping their way towards what precisely it is that they are fighting. The objective of terrorism is terror; to terrorise people and government through random mass killings. It exploits the very freedoms – of expression, communication, movement available in societies it targets.

It maximises impact with minimal investment in human capital; suicide missions are undertaken by young minds vulnerable to illusions about this life or the next. It exalts hatred as heroism.

The Geneva Convention was not written for a struggle against shadow armies that glorify mass murder or refuse to distinguish between war and peace. We need a doctrine for permanent war, and we need signatories that are ready to implement this doctrine with all the muscle at their command.

Walter Nicolai, the now forgotten head of Germany’s intelligence services during World War I, told his country that if it wanted to succeed it would have to adopt a new theory: ‘war in peace’. A hundred years later, this seems a relevant basis for an effective counteroffensive. But before we can solve the problem we must learn to recognise it. Fudge will not serve.

America cannot long continue a policy of selective punishment in a war that also afflicts its allies, friends and like-minded nations. It must accept what Prime Minister Narendra Modi has been saying repeatedly: There is no good terrorism and bad terrorism; terrorism is terrorism. To measure Osama and Hafiz by different yardsticks is akin to America saying that it would fight only Japan in World War II.

Terrorists are clear about who their enemy is: The ‘near enemy’ are those who challenge their ideas and politics within their own countries, hence the multiple civil wars; the ‘far enemy’ are those who support the ‘near enemy’, broadly the West, including Russia; and those who have ‘usurped Islamic space’, like China or India. Do we have equal clarity about terrorists?

Modi also noted that we must delink terrorism from religion. The refugees who are escaping their tortured homeland are also Muslim; in fact they are more honest Muslims than the deranged ‘jihadis’. We must learn something from this epic tragedy.

This is also a conflict between theocracy and democracy; between practitioners of faith-supremacy and believers in faith-equality as the basis of civilised behaviour. This war has to be fought at both military and ideological levels.

The answer to regression is not complicated: modernity. Modernity has four basic, non-negotiable principles. A modern nation must be democratic; it must believe in secularism; it must promote gender equality; and it must eliminate the curse of inequity and poverty. This is the charter for regions in chaos, which can save the future from ravages of the present.

Osborne is all for renationalisation – so long as the nation isn’t Britain

Aditya Chakrabortty in The Guardian

Steel yourself, for an unlikely source is about to spout a highly unfashionable idea. This week, George Osborne will come out for renationalisation.

You won’t hear the N-word from his lips, of course. Nor shall the chancellor go full Corbyn and seize some of the FTSE’s crown jewels. Instead, you can expect something far more in keeping with the spirit of 21st-century Britain. The government will indeed put some of our most vital infrastructure under state control – but the states in question will be France and China.

At some point during this week’s visit of president Xi Jinping – perhaps sandwiched between lunch at the palace and a trip to Chequers – Osborne shall confirm that nuclear plants will be built at Hinkley in Somerset and Sizewell in Suffolk, by the energy giant EDF, nearly 85% owned by the French government, and China. What’s more, Beijing will get a shot at designing and building its own nuclear facility at Bradwell in Essex.

Britain has made 'visionary' choice to become China's best friend, says Xi


Even as that announcement is made with all the fanfare available to the British state, the promises of privatisation will be revealed as lies. What were voters guaranteed by Margaret Thatcher and John Major, as they flogged off electricity and the rest of our publicly-owned utilities? More competition, lower bills and greater investment: all the plump fruit of a more dynamic capitalism.

A generation later and their children, David Cameron and Osborne, are handing Britain’s nuclear future back to the public sector – of two foreign countries – and paying handsomely for the privilege.

Take Hinkley, which at £24.5bn will cost as much as the London Olympics, Crossrail and a new terminal at Heathrow put together. Osborne will proudly blare that taxpayers aren’t chipping in a penny towards the costs. True enough, but his civil servants will quietly admit that we are guaranteeing up to £17bn of the total cost. In the screwy logic of Britain’s renationalised capitalism, the public assumes the risk while the corporations get to scoop the profits.

Because rest assured, there will be profits – all of us will be making sure of that. To secure EDF as a builder, Cameron guaranteed a fixed price for electricity from Hinkley of £92.50 per megawatt hour. That is around double the going rate for electricity on the wholesale markets, a price so high that equity analysts term it“financial insanity”. Change your supplier as often as you like, you and everyone else in Britain will be paying for that de facto subsidy in your electricity bills for decades to come. Britons will in effect be paying more for their energy so that French households can pay less. Indeed, so generous are the terms of this deal that the government of Austria is currently taking Britain to court on the grounds that it’s handing out state aid to EDF.

Holidaymakers in Burnham-on-Sea, Somerset, across from Hinkley Point nuclear power station. Photograph: SWNS.com

Yes, you read that last sentence right: the UK stands accused of dispensing state aid – to another state. How many times have you read about some age-old manufacturer and thousands of jobs going down the swanee, while ministers wrung their hands over European state aid rules? Now we know that such rules can be tested – provided the recipient is headquartered not in Port Talbot, but Paris.

When questioned about these eye-watering numbers, ministers will inevitably defend them as a price worth paying to stop the lights going out. But like the sanctity of the state-aid regulations, this is a bogeyman deployed to shut down conversation. True, Britain has a clapped-out generating system. Realistically, the price we face for that is not our TVs going dark in the middle of Gogglebox, or our smartphones no longer charging, but paying a lot more for our electricity. Except, with Hinkley, we’re guaranteed to be paying a lot more anyway.

As James Meek points out in his prize-winning book Private Island, the publicly owned energy-generating system was in very good nick, enjoying both investment and domestic engineering expertise. A generation of privatisation has seen off both of those. Sue Ion, a fellow of the Royal Academy of Engineering who has spent over 30 years in nuclear power, says, “We have no capacity to make a reactor design from scratch.”

Hinkley’s boss, Nigel Cann, boasted to this paper last year of the thousands of local jobs his plant would bring. He gave just one example: “We’ve already seen a local food co-op … set up in preparation for feeding what we estimate to be the 25,000 people” who’ll move through the site. One insider predicts that the British will largely be employed “digging ditches, laying concrete and running the pie wagon”. The big-boy jobs will go to those calling the shots – that is, the French and the Chinese.

A share-owning democracy, Thatcher promised, as she auctioned off BT. Britons were about to be put in charge of their economy. Another fib: in 1981, ordinary Britons owned over 25% of the stock market; they now hold less than half that.

She offered a capitalism in which private firms took risks and reaped rewards, while the customer benefited. What she delivered was very different. A system in which you can’t get 3G on trains, can’t rely on broadband or buses in the countryside, and in which train operators and energy firms compete not on service – but on how many tariffs they can bamboozle customers with. In which parastatal organisations from France and China, Germany and the Netherlands take an easy clip from ordinary British customers and plough the bare minimum back. This isn’t a dynamic capitalism, it is lazy, arthritic and very expensive.

And still Whitehall and Westminster, and their mini-mes in town halls up and down the country, carry on down the same road. Cameron proposes to sell anything left in the cupboard, even old student loans. Civil servants let Redcar and thousands of steel jobs go down the drain, as they lend millions to Roman Abramovich to keep his foreign steel plant going.

Nuclear power is merely the punchline to this whole rotten joke. We won’t build it, we won’t own it, we certainly won’t control it. But we will pay for it: in lost jobs, in vanishing taxes, in whopping great winter fuel bills.

Beware Russia’s links with Europe’s right

Moscow is handing cash to the Front National and others in order to exploit popular dissent against the European Union

• 
• • Luke Harding
  • The Guardian, Monday 8 December 2014 18.09 GMT

‘The Front National confirmed last week that it had taken a whopping €9.4m loan from the First Czech Russian bank in Moscow.’ Photograph: Eric Gaillard/Reuters

It sounds like a chapter from a cheesy spy novel: former KGB agent, chucked out of Britain in the 80s, lends a large sum of money to a far-right European party. His goal? To undermine the European Union and consolidate ties between Moscow and the future possible leader of pro-Kremlin France.

In fact this is exactly what’s just happened. The founder of the Front National (FN), Jean-Marie Le Pen, borrowed €2m from a Cyprus-based company, Veronisa Holdings,owned by a flamboyant character and cold war operative called Yuri Kudimov.

Kudimov is a former KGB agent turned banker with close links to the Kremlin and the network of big money around it. Back in 1985 Kudimov was based in London. His cover story was that he was a journalist working for a Soviet newspaper; in 1985 the Thatcher government expelled him for alleged spying. (During the same period Vladimir Putin was a KGB officer in Dresden.)

In Paris, the FN confirmed last week that it had taken a whopping €9.4m (£7.4m) loan from the First Czech Russian bank in Moscow. This loan is logical enough. The FN’s leader, Marine Le Pen, makes no secret of her admiration for Putin; her party has links to senior Kremlin figures including Dmitry Rogozin, now Russia’s deputy prime minister, who in 2005 ran an anti-immigrant campaign under the slogan “Clean Up Moscow’s Trash”. Le Pen defended her decision to take the Kremlin money, complaining that she had been refused her access to capital: “What is scandalous here is that the French banks are not lending.” She also denied reports by the news website Mediapart, which broke the story, that the €9.4m was merely the first instalment of a bigger €40m loan.

The Russian money will fuel Marine Le Pen’s run for the French presidency in two years’ time. Nobody expects her to win, but the FN topped the polls in May’s European elections, winning an unprecedented 25% of the vote; Le Pen’s 25 new MEPs already form a pro-Russian bloc inside the European parliament.

In part, the Moscow loan can be understood as an act of minor and demonstrative revenge. It follows President François Hollande’s decision to postpone the delivery to Moscow of the first of two Mistral helicopter carriers, in a deal worth €1.2bn. His U-turn follows considerable western pressure, in the wake of Russia’s annexation of Crimea and its ongoing covert invasion of eastern Ukraine.

But there is also a more profound and sinister aspect to the Moscow cheque. Since at least 2009 Russia has actively cultivated links with the far right in eastern Europe. It has established ties with Hungary’s Jobbik, Slovakia’s far-right People’s party and Bulgaria’s nationalist, anti-EU Attack movement. Here, political elites have become increasingly sympathetic to pro-Putin views.

According to Political Capital, a Budapest-based research institute which first observed this trend, the Kremlin has recently been wooing the far-right in western Europe as well. In a report in March it argued that Russian influence in the affairs of the far right is now a “phenomenon seen all over Europe”. Moscow’s goal is to promote its economic and political interests – and in particular to ensure the EU remains heavily dependent on Russian gas.

In Soviet times the KGB used “active measures” to sponsor front organisations in the west including pro-Moscow communist parties. The Kremlin didn’t invent Europe’s far-right parties. But in an analogous way Moscow is now lending them support, political and financial, thereby boosting European neo-fascism.

In part this kinship is about ideology or, as Political Capital puts it, “post-communist neo-conservatism”. The European far right and the Kremlin are united by their hostility to the EU. Since becoming president for the third time in 2012, Putin has been busy promoting his vision for a rival Eurasian Union. This is an alternative political bloc meant to encompass now-independent Soviet republics, with Moscow rather than Brussels as the dominant pole.

The Kremlin has also discovered that the western political system is weak, permeable and susceptible to foreign cash. Putin has always believed that European politicians, like Russian ones, can be bought if the money is right. According to US diplomatic cables leaked in 2010, Silvio Berlusconi has benefited “personally and handsomely” from energy deals with Russia; the former German chancellor Gerhard Schröder, Putin’s greatest European ally, sits on the board of the Nord Steam Russian-German gas pipeline.

Far-right and rightwing British politicians, meanwhile, have also expressed their admiration for Russia’s ex-KGB president. In March Nigel Farage named Putin as the world leader he most admires, and praised the “brilliant” way “he handled the whole Syria thing”. In 2011 the BNP’s Nick Griffin went to Moscow to observe Russia’s Duma election. Afterwards he announced that “Russian elections are much fairer than Britain’s”. Last week Griffin tweeted praise for Russia Today, the Kremlin’s English-language TV propaganda news channel: “RT – For People Who Want the Truth”.

There are many ironies here. In his state of the nation address last Friday, Putin implicitly compared the west to Hitler, and said it was plotting Russia’s dismemberment and collapse. In March Putin defended his land-grab in Crimea by arguing he was rescuing the peninsula from Ukrainian “fascists”. A few weeks later a motley group of radical rightwing European populists turned up in Crimea to watch its hastily arranged “referendum”.

Tactically, Russia is exploiting the popular dissent against the EU – fuelled by both immigration and austerity. But as rightwing movements grow in influence across the continent, Europe must wake up to their insidious means of funding, or risk seeing its own institutions subverted.

Intervention, evasion, destabilisation by Security Council members

Brahma Chellaney in The Hindu

If Libya, Syria and Iraq are coming undone and Ukraine has been gravely destabilised, it is the result of interventions by big powers that claim to be international law enforcers when, in reality, they are lawbreakers

Big powers over the years have targeted specific regimes by arming rebel groups with lethal weapons, thereby destabilising some states and contributing to the rise of dangerous extremists and terrorists. The destabilisation of Ukraine, Syria, Iraq and Libya, among other states, is a result of such continuing geopolitical games.

It is the local people who get killed, maimed and uprooted by the interventions of major powers and their regional proxies. Yet those who play such games assume a moral posture to rationalise their interventionist policies and evade responsibility for the consequences of their actions. Indeed, they paint their interference in the affairs of other sovereign states as aimed at fighting the “bad” guys.

Cold War echo

Take the blame game over the downing of Flight MH 17, which was shot down by a surface-to-air missile (SAM), allegedly fired by eastern Ukraine’s Russian-speaking separatists, a number of whom have clearly been trained and armed by Russia. Russia’s aid to the separatists and Washington’s security assistance to the government in Kiev, including providing vital intelligence and sending American military advisers to Ukraine, is redolent of the pattern that prevailed during the Cold War, when the two opposing blocs waged proxy battles in countries elsewhere.

Today, with the Ukrainian military shelling rebel-held cities and Russia massing heavy weapons and troops along the frontier, the crisis threatens to escalate to a direct U.S.-Russia confrontation, especially if Moscow directly intervenes in eastern Ukraine in response to the worsening humanitarian crisis there. The United Nations says the fighting in eastern Ukraine has uprooted more than 230,000 residents. Over 27,000 of them have taken sanctuary in Russia.

After the MH 17 crash, U.S. President Barack Obama was quick to hold Russia and its President, Vladimir Putin, guilty in the global court of opinion over the downing and to spotlight Russian aid to the separatists. Through sanctions and diplomacy, Mr. Obama has steadily ratcheted up pressure on Mr. Putin to stop assisting the rebels. Yet, Mr. Obama has had no compunction in gravely destabilising Syria through continuing covert aid to “moderate” militants there. The aid is being channelled through the Central Intelligence Agency (CIA) and the jihad-bankrolling oil sheikhdoms.

Regime-change strategy

Mr. Obama set out on the mission of regime change in Syria by seizing the opportunity that opened up in 2011, when popular protests broke out in some cities against President Bashar al-Assad’s autocratic rule. The detention and torture of a group of schoolchildren, who had been caught scribbling anti-government graffiti in the city of Deraa, led to protests and demands for political reforms and a series of events that rapidly triggered an armed insurrection with external assistance.

From bases in Turkey and Jordan, the rebels — with the clandestine assistance of the U.S., Britain and France — established a Free Syrian Army, launching attacks on government forces. Washington and its allies simultaneously mounted an intense information war demonising Mr. Assad and encouraging officers and soldiers to desert the Syrian military and join the Free Syrian Army.

Read: On Syria, Russia awaits chance to say ‘I told you so’

It is clear three years later that their regime-change strategy has backfired: Not only has it failed to oust Mr. Assad, it has turned Syria into a failed state and led to the rise of the Islamic State of Iraq and the Levant — a brutal, medieval organisation seeking to establish a caliphate across the Middle East and beyond. With radical jihadists now dominating the scene, the Free Syrian Army has become a marginal force, despite the CIA continuing to train and arm its members in Jordan.

Had Mr. Obama, British Prime Minister David Cameron and French President François Hollande not embarked on this strategy — which helped instil the spirit of jihad against the Assad regime and opened the gates to petrodollar-financed weapons to Syrian jihadists — would murderous Islamists be in control of much of northern Syria today? It was this control that served as the staging ground for the rapid advance of the Islamic State of Iraq and the Levant into Iraq. This group now is in a position to potentially use water as a weapon through its control of the upstream areas along the Euphrates and Tigris rivers in Syria and Iraq, including important dams.

By inadvertently turning Syria into another Afghanistan — and a threat to regional and international security — the interveners failed to heed the lessons from the CIA’s funnelling of arms to the Afghan mujahideen (or self-proclaimed “holy warriors” of Islam) in the 1980s. The funnelling of arms — partly financed by Saudi Arabia and some other oil sheikhdoms — was a multibillion-dollar operation against the Soviet forces in Afghanistan that gave rise to al-Qaeda and monsters like Osama bin Laden and Mullah Mohammad Omar, chief of the Taliban who remains holed up in Pakistan. It ranked as the largest covert operation in the CIA’s history.

 Now, consider a different case where a regime-change strategy spearheaded by the U.S., Britain and France succeeded — Libya. The ouster of Col. Muammar Qadhafi’s government through U.S.-led aerial bombardment in 2011, however, ended up fomenting endless conflict, bloodletting and chaos in Libya.

The virtual crumbling of the Libyan state, more ominously, has had major international implications — from the cross-border leakage of shoulder-fired SAMs from the Qadhafi-built arsenal, including to Syrian jihadists, to the flow of other Libyan weapons to al-Qaeda-linked groups in the arid lands near the Sahara desert known as the Sahel region. Nigeria’s Boko Haram extremists have also tapped the Libyan arms bazaar.

The weapons that Qatar and, on a smaller scale, the United Arab Emirates shipped to Libyan rebels with U.S. approval, including machine guns, automatic rifles and ammunition, have not only destabilised Libya but also undermined security in Mali, Niger and Chad. These weapons had been handed out like candy to foment the uprising against Qadhafi.

There cannot be better proof of how the toppling of Qadhafi has boomeranged than the fact that the U.S., whose ambassador was killed in a 2012 militant attack in Benghazi, the supposed capital of the Libyan “revolution,” has now shut its embassy in Tripoli, citing increasing lawlessness. The predawn evacuation of its entire embassy staff to Tunisia, with U.S. warplanes providing air cover, represented a public admission of defeat.

The plain truth is that it is easier for outside forces to topple or undermine a regime than to build stability and security in the targeted country. With neighbourhoods becoming battlefields, Iraq, Syria and Libya are coming undone. Another disintegrating state is Afghanistan, where Mr. Obama is seeking to end the longest war in American history.

Marginalisation of U.N.

Such is the United Nations’ marginalisation in international relations that it is becoming irrelevant to the raging conflicts. To make matters worse, the U.N. Security Council’s five permanent members, although tasked by the U.N. Charter to preserve international peace and security, have helped spark or fuel regional conflicts and aided the rise of insurgent groups through their interventionist and arms-transfer policies. These five powers — all nuclear-armed — account for more than 80 per cent of the world’s official exports of conventional weapons and most of the unofficial transfers. Chinese arms, for example, have proliferated to a number of guerrilla groups active in Africa and Asia, including insurgents in India’s northeast.

The only mechanism to enforce international law is the Security Council. Yet, its permanent members have repeatedly demonstrated that great powers use, not respect, international law. They have a long history of ignoring international rules when these conflict with their plans. In other words, the international law enforcers are the leading lawbreakers.

Mr. Obama, in toppling Qadhafi through the use of air power, and Mr. Putin, in annexing Crimea, paradoxically cited the same moral principle that has no force in international law — “responsibility to protect.” Indeed, the transition from the 20th to the 21st centuries heralded the open flouting of international law, as represented by the bombing of Serbia, the separation of Kosovo from Serbia, and the invasions of Afghanistan and Iraq. Against this background, it is scarcely a surprise that, despite the continuing rhetoric of a rules-based international order, the world is witnessing the triumph of brute force in the 21st century.

If the Security Council is to act more responsibly, its permanent members must look honestly at what they are doing to undermine international peace and security. This can happen only if the Council’s permanent membership is enlarged and the veto power abolished to make decision-making in that body truly democratic.

The French are right: tear up public debt – most of it is illegitimate anyway

Debt audits show that austerity is politically motivated to favour social elites. Is a new working-class internationalism in the air?

• 
• • Razmig Keucheyan
  • theguardian.com, Monday 9 June 2014 17.17 BST

Contracts for Chilean student loans worth $500m go up in flames – the 'imaginative auditing' of the artist Francisco Tapia, commonly known as Papas Fritas (Fried Potatoes). Photograph: David von Blohn/REX

As history has shown, France is capable of the best and the worst, and often in short periods of time.

On the day following Marine Le Pen's Front National victory in the European elections, however, France made a decisive contribution to the reinvention of a radical politics for the 21st century. On that day, the committee for a citizen's audit on the public debt issued a 30-page report on French public debt, its origins and evolution in the past decades. The report was written by a group of experts in public finances under the coordination of Michel Husson, one of France's finest critical economists. Its conclusion is straightforward: 60% of French public debt is illegitimate.

Anyone who has read a newspaper in recent years knows how important debt is to contemporary politics. As David Graeber among others has shown, we live in debtocracies, not democracies. Debt, rather than popular will, is the governing principle of our societies, through the devastating austerity policies implemented in the name of debt reduction. Debt was also a triggering cause of the most innovative social movements in recent years, the Occupy movement.

If it were shown that public debts were somehow illegitimate, that citizens had a right to demand a moratorium – and even the cancellation of part of these debts – the political implications would be huge. It is hard to think of an event that would transform social life as profoundly and rapidly as the emancipation of societies from the constraints of debt. And yet this is precisely what the French report aims to do.

The audit is part of a wider movement of popular debt audits in more than 18 countries.Ecuador and Brazil have had theirs, the former at the initiative of Rafael Correa's government, the latter organised by civil society. European social movements have also put in place debt audits, especially in countries hardly hit by the sovereign debt crisis, such as Greece and Spain. In Tunisia, the post-revolutionary government declared the debt taken out during Ben Ali's dictatorship an "odious" debt: one that served to enrich the clique in power, rather than improving the living conditions of the people.

The report on French debt contains several key findings. Primarily, the rise in the state's debt in the past decades cannot be explained by an increase in public spending. The neoliberal argument in favour of austerity policies claims that debt is due to unreasonable public spending levels; that societies in general, and popular classes in particular, live above their means.

This is plain false. In the past 30 years, from 1978 to 2012 more precisely, French public spending has in fact decreased by two GDP points. What, then, explains the rise in public debt? First, a fall in the tax revenues of the state. Massive tax reductions for the wealthy and big corporations have been carried out since 1980. In line with the neoliberal mantra, the purpose of these reductions was to favour investment and employment. Well, unemployment is at its highest today, whereas tax revenues have decreased by five points of GDP.

The second factor is the increase in interest rates, especially in the 1990s. This increase favoured creditors and speculators, to the detriment of debtors. Instead of borrowing on financial markets at prohibitive interest rates, had the state financed itself by appealing to household savings and banks, and borrowed at historically normal rates, the public debt would be inferior to current levels by 29 GDP points.

Tax reductions for the wealthy and interest rates increases are political decisions. What the audit shows is that public deficits do not just grow naturally out of the normal course of social life. They are deliberately inflicted on society by the dominant classes, to legitimise austerity policies that will allow the transfer of value from the working classes to the wealthy ones.

 A sit-in called by Occupy France at La Défense business district in Paris. Photograph: Afp/AFP/Getty Images

A stunning finding of the report is that no one actually knows who holds the French debt. To finance its debt, the French state, like any other state, issues bonds, which are bought by a set of authorised banks. These banks then sell the bonds on the global financial markets. Who owns these titles is one of the world's best kept secrets. The state pays interests to the holders, so technically it could know who owns them. Yet a legally organised ignorance forbids the disclosure of the identity of the bond holders.

This deliberate organisation of ignorance – agnotology – in neoliberal economies intentionally renders the state powerless, even when it could have the means to know and act. This is what permits tax evasion in its various forms – which last year cost about €50bn to European societies, and €17bn to France alone.

Hence, the audit on the debt concludes, some 60% of the French public debt is illegitimate.

An illegitimate debt is one that grew in the service of private interests, and not the well being of the people. Therefore the French people have a right to demand a moratorium on the payment of the debt, and the cancellation of at least part of it. There is precedent for this: in 2008 Ecuador declared 70% of its debt illegitimate.

The nascent global movement for debt audits may well contain the seeds of a new internationalism – an internationalism for today – in the working classes throughout the world. This is, among other things, a consequence of financialisation. Thus debt audits might provide a fertile ground for renewed forms of international mobilisations and solidarity.

This new internationalism could start with three easy steps.

1) Debt audits in all countries

The crucial point is to demonstrate, as the French audit did, that debt is a political construction, that it doesn't just happen to societies when they supposedly live above their means. This is what justifies calling it illegitimate, and may lead to cancellation procedures. Audits on private debts are also possible, as the Chilean artist Francisco Tapia has recently shown by auditing student loans in an imaginative way.

2) The disclosure of the identity of debt holders

A directory of creditors at national and international levels could be assembled. Not only would such a directory help fight tax evasion, it would also reveal that while the living conditions of the majority are worsening, a small group of individuals and financial institutions has consistently taken advantage of high levels of public indebtedness. Hence, it would reveal the political nature of debt.

3) The socialisation of the banking system

The state should cease to borrow on financial markets, instead financing itself through households and banks at reasonable and controllable interest rates. The banks themselves should be put under the supervision of citizens' committees, hence rendering the audit on the debt permanent. In short, debt should be democratised. This, of course, is the harder part, where elements of socialism are introduced at the very core of the system. Yet, to counter the tyranny of debt on every aspect of our lives, there is no alternative.

Jesus was a Buddhist Monk

Robert Fisk: It took decades for truth to be revealed in Algeria. How long will it take Syria?

ROBERT FISK in The Independent

Sunday 20 October 2013

Algeria’s ‘timid’ historians shy away from revealing the ugly truths about war

Major General Jamaa Jamaa was not a popular man in Beirut. One of Syria’s most senior intelligence officers in Lebanon until the withdrawal of Bashar al-Assad’s troops in 2005, he was headquartered in the run-down Beau Rivage Hotel in west Beirut and also in the Bekaa town of Anjaar, where Lebanese men would be taken for interrogation and later emerge – or not emerge at all – sans teeth or nails.  He was a loyal, ruthless apparatchik for Bashar’s father Hafez, and his mysterious killing last week in the Syrian war provoked no tears in Beirut.  The UN had interviewed Jamaa about the murder of former Lebanese prime minister Rafiq Hariri whose 2005 assassination brought about the Syrian withdrawal from Lebanon.  But how did Jamaa die?  Syrian state television would say only that he was “martyred while carrying out his national duties to defend Syria and its people and pursuing terrorists (sic) in Deir el-Zour”.

All kinds of rebel groups – including, of course, the equally ruthless al-Qa’ida affiliates – wanted to add his name to their “kills”.  He was shot in the head by a sniper in the eastern Syrian oil town.  Jamaa was also killed, we were informed, by a booby-trap, and blown up by a suicide bomber.  All that we can be sure of is that his remains, such as they were, were taken for burial in the village hills above Lattakia where he was born.  How long before we know the truth?

I am brought to this question by the secrecy which still smothers the 1954-62 Algerian-French war of independence where a cruel French regime of occupation fought a war against an equally cruel and determined Algerian resistance, primarily led by the National Liberation Front, the FLN. French officers indulged in an orgy of torture while their Algerian opposite numbers slaughtered each other – as well as the French – in a Stalinist purge of thousands of their own followers suspected of collaborating with the French occupation. For decades, the French refused to discuss this most dishonourable of wars – censoring their own television programmes if they dared talk of torture – while the subsequent FLN dictatorship only published infantile accounts of the heroism of their “martyr” cadres. The French, you see, were fighting “terrorism”.  The FLN were fighting a brutal, Gaullist regime.

The parallels are, of course, not exact. But over the past months, a remarkable phenomenon has made its appearance in Algeria.  Dozens of elderly Algerian maquisards from the conflict that ended just over half a century ago, have turned up at small publishing houses in Algiers and Oran with  private manuscripts, containing frightening accounts of the savage war in which they fought and in which their officers tortured and massacred and assassinated their own comrades. Rival Algerian resistance groups – not unlike the “Free Syrian Army” and their Islamist rebel enemies in northern Syria today – also slaughtered each other.

Take, for example, the death of Abane Ramdane. The “architect” of the Algerian revolution, a friend of the French philosopher and revolutionary Franz Fanon, organizer of the Soummam congress which created the first independent Algerian leadership in 1956, Ramdane – a man almost as keen on his own personality as he was on the classless revolution he helped initiate – was assassinated in Morocco the following year, allegedly by the French.  For decades, he was extolled as a martyr who had “died under French bullets”.  But now a former member of the FLN has dared to suggest the names of his real killers:  Krim Belkacem, head of the FLN’s third wilaya (district) and later a minister of defence and foreign affairs in the newly independent government of Algeria;  Abdelhafid Boussouf, the vicious “father of intelligence” in all the Algerian wilayas, who condemned many of his own comrades to death;  and Lakhdar Ben Tobbal, a guerrilla leader who later negotiated with the French at Evian.

Then there’s the sinister figure of Si Salah, head of wilaya 4, who was persuaded – by French intelligence, although he did not know this – that hundreds of his own men were collaborators. On Si Salah’s personal instructions, almost 500 of his comrades were tortured to death or executed. But Si Salah, fearful that the FLN’s military wing might be defeated by the French, secretly opened negotiations with De Gaulle – and was then himself assassinated, supposedly by the French, but almost certainly by the FLN. The French investigative journalist, Pierre Daum, has spoken of the “extreme timidity of Algerian historians”, and recounted how one Algerian publisher said he lacked the courage to print a book on the infiltration of the FLN. 

“In 2005, this guy came to see me,” the publisher told Daum. “I refused his manuscript because it was filled with names, ‘X tortured Y’, and so on.  Imagine the children of a ‘martyr’ – who believe their father died under French gunfire – discovering that he perished under Algerian torture!”

The real story of the much more recent Algerian war – between the Islamists and the government in the 1990s (total deaths 250,000, a hundred thousand more than in Syria today) – still cannot be told by Algerian historians.  It has been left to today’s Algerian novelists to cloak facts in fiction in order to reveal the truths of this terrible conflict. One such tale – a real incident – is recalled in a novel. A junior officer in the Algerian army, it seems, was discovered to have betrayed his comrades to Islamist rebels. His wife and children were summoned from their village and taken by military helicopter to the barren hillside where the captured soldier was being held.  And there, in front of his family, the man was tied to a tree, doused with petrol, and burned alive.

How long must we wait, then, for the secrets buried beneath the rubble of the Syrian war?