Israel Takes the Low Road

The government of Israel has crossed a serious line in the operation against a Turkish flotilla heading toward Gaza. Fifteen people were killed by Israeli troops, including a Turkish member of parliament. Belgium Foreign Minister Steven Vanackere said the Israeli military attack on an aid flotilla headed for Gaza “looks like it was rather disproportionate”. Israel has been forced to advise all its nationals to leave Turkey.


The stupidity of Netanyahu and his cabinet is almost unbelievable if it did not fit a consistent pattern of alienating allies and attempting to provoke an attack on Iran.
One of the more profoundly predictably hawks, Israeli Deputy Foreign Minister Danny Ayalon charged that the mission was simply an attempt to provoke Israel. Logic would dictate that if that was the case, and it certainly was, the last thing to do would be to take the bait. But, true to form, the Israels fed the view that they are not only unreasonable, but brutal by being exactly that.

If the Israeli government possessed even a modicum of grey matter at this point they would have avoided falling into this particular trap. However, in the black and white apartheid world of this Israeli government, logic did not prevail.

The Turkish NGO flotilla was designed to divide Israel and Western governments and to create a political crisis inside Israel. It has now, courtesy of the Netanyahu government, succeeded spectacularly. It is difficult to underestimate the damage that this has done to perceptions of Israel. Relations with the US and Europe, where relations are already strained, will deteriorate further.

Israel’s relationship with Turkey, a rare and extremely powerful Moslem ally which just happens to be a member of NATO, can now be consigned to the trash bin. The isolation of Israel is now going to get much, much worse and siding with Israel on this issue is not in the interests of any Western country. Israeli sabre rattling about Iran will no longer be viewed as simply an arguable position. Israel is in an extremely precarious position.
The best outcome now would be new elections and the removal of the hardliners from power in Israel.

China Speaks

The ramifications of the sinking of the Chon An by North Korea is entering a new, but likely closing phase as preparations are made for additonal sanctions by the United Nations.  Although the bellicose rhetoric from the North and the all but severing of economic and political contacts by the South continue, no sense of military action by either side is evident.  It is in everyone's interest that it stays that way. 

China has taken position that comports with its traditional desire to maintain the status quo on the peninsula. Even Beijing seems to be having difficulty with the reasons for this escalation by the North.  Despite the event, the reason for the sinking is less important than containing the potential damage. The next phase in the UN will begin to define how China's position in the region will be judged, but this remark will be parsed until the sanctions regime is subjected to a vote: "China will defend no one" whatever the outcome may be, Wen (China's Premier) also said, according to Lee (SK President).

Depending on the nature and extent of the sanctions, that remark could mean an abstention. If so, the North is in for a very rough time if sanctions are imposed.  China cannot afford an unstable North - particulary one which might lash out militarily confronting China with an even worse foreign policy dilema. The deal may this - China abstains, sanctions are imposed, China feeds the North to keep it from collapse. Face is saved.

Merkel, Barroso, Euro – Oh My

Image by European Parliament via Flickr

Now it’s personal. Last week, as reported in the Guardian, German suggestions to reform the Euro-zone and re-open the Lisbon Treaty elicited a sharply worded response from José Manuel Barroso, the current head of the EC. Calling the German Chancellor “naïve” for suggesting that the Lisbon Treaty be re-opened was not designed to raise the level of the debate or improve her mood. The German response - that Barroso’s remarks were “absurd” - put the discussion in the basement.
Outside of Germany, I don’t think that many in the Euro-zone or the EU in general would support the German proposals for several reasons. First, re-opening the Treaty, which barely won approval in the first place, for the sole purpose of inserting provisions to penalize member states for not following monetary policy, is far more absurd than Barroso’s opposition to the proposal. As Barroso’s pointedly reminded Merkel, the Euro was the brainchild of France and Germany. Both, incidentally, also breached the monetary policies that were established. For Germany now to push forward some sort of punishment mechanism strikes me as a species of economic and political hegemony that is particularly distasteful to most of the other member states. Furthermore, expelling a member for non-compliance would likely result in a permanent, volutary withdrawal for the targeted country. A similar result would likely occur if voting rights were withdrawn. The European idea would be dead.
Second, and related to the first, is that Merkel is making a blatant attempt to control and mold the EU in Germany's image. In other words, nationalism is driving the German proposals. Again. Merkel is treading on dangerous ground and she has only herself to blame. It is abundantly clear that her anti-Greek rhetoric not only inflamed German public opinion but also significantly delayed EU action to develop a rescue plan for Greece. German political actions were directed at assigning blame first rather than fixing the problem and designed to increase German control of the EU. This is what the original economic union was designed to avoid - the nationalism that brought Europe to its knees. Eastern and Southern Europe will not swallow that particular pill. The UK would have the perfectly justified reason for never considering closer ties with an EU run from Berlin.

Merkel has now lost her ruling coalition in parliament. She has managed to inflame German public opinion not only against Greece, but Greeks, implying an inferiority of all southern tier member states. They have done it to the Turks. Now the Greeks, and by implication, Spain and Portugal. That is a dangerous road for Germans to follow under any circumstance and German perseverance in that regard will drive the southern tier and the Eastern European members to look elsewhere for political and economic support out of their self-inflicted economic trap.

Russian Foreign Policy, Economics and Local Elections

United Russia’s electoral loss to the Communist Party in Bratsk, Siberia for mayor has garnered slight media attention, even in the Russian press, but it is a reflection on the impact of the extent of the financial crises within Russia. United Russia also lost the mayor’s race in Irkutsk, a major city, last March – also to the Communist Party.


Although the latest defeat was likely caused by the ineptitude of local United Russia political leadership – they managed to field two candidates who split the vote for which heads will role – it is a concern for the Kremlin as it tries to recover from the international financial collapse which severely impacted Russia’s economy.

Local political concerns for the ruling party will likely not translate into a threat to United Russia’s control of the Duma, but it cannot absorb too many of these local election losses without eventual damage to its internal network. There is a connection with the economic turmoil resulting in these losses and Russian foreign policy.

The principal concern of the Kremlin now is attracting international investors. Should the control exercised by United Russia weaken internally, particularly in the industrial centers, those same investors will begin to either look elsewhere, or demand a better deal on their investments. The strength and stability of the political structure might become questionable if further internal problems begin to deteriorate.
Russia’s economic problems have resulted in the weak start on the custom’s union among Russia, Kazakhstan and Belarus. The union, which came into existence on January 1 and was to begin official operations on July 1, is one part of Russia’s attempt to restore economic confidence within the investment community, both internally and internationally. It is not off to a positive start. The union’s commencement has been put off for a year.
It does not help that Ukraine – a member of the WTO while Russia’s membership has been languishing for 17 years – has declined to become part of the custom’s union. Despite the largely pro-Russian leanings of the President Yanukovych, Ukraine’s economic interests are grounded in more cooperation with Western Europe and Yanukovych has shown little inclination to increase the trade relationship with Russia beyond its current bi-lateral format.
Further complicating matters is Belarus, which has recently poked its finger in the Kremlin’s eye by sheltering the fugitive former president of the Kyrgyz Republic, refused to recognize the independence of Abkhazia and South Ossetia and which will be hosting Prime Minister Berlusconi in Minsk as part of the growing warming of relations with western Europe.
As a result of adverse economic and political events during the past year, Russian foreign policy may be undergoing a change from its recent bellicose nature toward the west. Although largely successful in reasserting Russian control in the near abroad ranging from the annexation of Georgian territory to the recent revolution in the Kyrgyz Republic, the success has come at a diplomatic and economic cost. Eastern Europe and the Baltics were particularly alarmed about the invasion of Georgia which had followed the economic arm-twisting of gas supply cut-offs. The Georgia adventure did not help Russia’s relationship with Western Europe, the United States or Turkey. Using gas supplies as a weapon is probably viewed in hindsight by Moscow as a mistake.
Now Russia desperately needs investment. Russia’s political pendulum has historically swung periodically between an eastern and western world view for sometimes very vague motives, if not outright caprice. There are signs that it is repositioning toward the middle on its current swing to the west for very practical political and economic reasons.

Final: Chon An Sunk by North Korean Torpedo

The blame from the sinking of the South Korean frigate Chon An has now been formally laid at the feet of North Korea. The consequences are coming, but it is unlikely that the South Korean government will resort to any sort of violent response. The fact that the findings were announced with the concurrence of all the investigators, which included representatives from Sweden, Australia, Britain and the US, will put North Korea in the position of denying the obvious.

Back in April, I questioned the “why” not the “how”. That question is still unanswered although it may simply be one of retaliation for successful defensive measures taken by South Korea in previous naval incidents. However, a pre-meditated attack is of a different order.

Various scenarios will begin to play out, including a call for additional sanctions in the United Nations. Korea is already an unpleasant place to live – more sanctions could make it all the more so. Which brings up China.

This might be the least welcome event for China during its period of negotiations with Japan over fishing rights and its position on financial matters with the United States. North Korea is supported economically by China and a surge of refugees that could result as North Korea is further penalized with sanctions is not tolerable prospect for Beijing. The US is likely now to bring additional, unwelcome, pressure on China to do something with North Korea. Japan may join the push as well. Certainly the South Korean will not look favourably on China if it fails to take any action or opposes additional sanctions.

The reality is that North Korea is a drain on China, both economically and politically. At the same time, an unstable North Korea is a threat to all her neighbours’ and, by treaty, to the US. The reaction of China to the findings will be important in maintaining stability while simultaneously dealing with a dangerous state prone to tantrums resulting in damage and deaths. 

I suspect that a new set of sanctions will be discussed, but not imposed.  China would not want the UN to further exacerbate North Korea's economic problems which could escalate uncontrollably.  It certainly does not want another tantrum from North Korea that could actually provoke a military response. But, China will need to give up something for their neighbor's latest provocation.

Moscow's Abkhazia and South Ossetia Problem

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Despite my normal misgivings about Ukraine’s changing foreign policy positions toward Russia and the West – none of which is surprising since Russia is next door and has all the leverage – their Minister of Foreign Affairs Kostyantyn Hryshchenko has said that the Yanukovych administration has no plans to recognize an independent Abkhazia and South Ossetia. Citing the sanctity of borders as the reason, Kyiv has now joined Minsk in refusing, so far, to bow to Moscow’s need to have some other countries aside from the diplomatic coups of getting Venezuela, Nicaragua and Nauru (look it up) to recognize both break-away regions of Georgia.

How long Belarus will keep up its in-your-face attitude with Russia is an open question. They have welcomed former president Bakiyev of the Kyrgyz Republic, a less than popular decision in the Kremlin, and have also refused recognition of Georgia’s lost regions. The same is true for Kyiv, which may be realizing that its balancing act with Europe would be damaged by recognition. Moscow has a problem, which may account for its less aggressive tone lately as it tries to attract Western investment.

Brazil and Turkey Convince Iran - Maybe

Brazil and Turkey appear to have brokered a deal with Iran to accept low-enriched uranium to Turkey for further enrichment. By appear, I mean that although the agreement has been signed by Iran, the Never-Ending-Negotiation Process of the Iranians may yet unravel this first step. And, lest anyone think the current Iranian regime has a corner on this particularly back to the bazaar tactic, the former Shah and his government also used this favourite of Persian tactics.

Nevertheless, despite the protestations of Israel that Turkey and Brazil have been “tricked”, this is a positive development. Israel has said that Erdogan and Lula are naïve. They may be a lot of things but naïve is not one of them - particularly in the case of Erdogan and Turkey for which this is a significant diplomatic and geo-political coup if it works.

Assuming acceptance of the deal by Russia, the United States and France and compliance by Iran, Turkey has established itself as a trusted broker in the region. If Iran follows through, then it has suffered a geo-political set-back as Turkey will use this to enhance its presence throughout the Middle East both economically and politically. By helping Iran to avoid an additional set of sanctions, Turkey has shown that it can accomplish what Iran cannot on its own. Big brother, little brother. Syria and Iraq need to pay attention now as Turkey puts its interests first to further enhance its position.

Israel needs to pay attention too. The remarks that Turkey is naïve show a strong tendency to ignore its ever shrinking circle of support. It is the present government that is naïve. If this deal is implemented, Netanyahu and his supporters lose their last chance for an attack on Iran. Good.

Russo-Turk Nuclear Deal

Turkey and Russia have signed an agreement worth $20 billion for Russia to build a nuclear plant in Turkey.  Russia will maintain a controlling interest in the operating company.  This is a big deal. It represents a major realignment in the region and will likely produce an even less cooperative Turkey for the EU and US as long as the current government remains in power.  Which is likely to be for a long time.

The failure of Europe to accept the strategic importance of Turkey, largely due to the religious and rascist attitudes of the continent, have not gone unnoticed in Moscow.  Russia has a strong economic and political interest to increase their influence with Ankara.  A cooperative Turkey will reduce the threat to undermining recent Russian gains in the Caucuses, further isolating Georgia, and in Central Asia.  The diplomatic and economic investment offensive to secure good relations with a key potential political and economic competitor is something that US foreign policy is incapable of doing because of its distraction in Afghanistan and Iraq. 

Europe has shown, through its handling under Germany's leadership, of the Greek financial crises, that it is incapable of operating in a unified manner with anything approaching timeliness.  Continuous snubbing of Ankara by the EU is changing the geo-political landscape of the greater Middle East region. The deal with Russia, tied together with significant investments in trade with Turkey, might be looked back on as a game changer.

European Dis-Union

Image by Henrique Oscar Loeffler via Flickr

What is happening with the European Union? For some time, it has been abundantly clear that the core countries of the EU, Germany and France, were intent on controlling the organization both politically and economically. Germany, the economic power in Europe, has clearly tried, more or less successfully, in bending the union to its needs and desires. France is a distant second on the team but still retains a certain amount of leverage over the direction of EU policy. The Greek financial crises revealed the key fissure affecting both concept and practice – self-interest. Germany became the indispensable player. In doing so, Brussels has been sidelined for major issues. Perhaps permanently.

The EU, founded in part to undermine the foundations of nationalism that had inflicted two major wars in the 20th century, is now closing the circle. As a unified economic union it has worked rather well – until now. The protection of NATO, led by the United States, provided the necessary cover to allow economic reforms resulting in unprecedented prosperity and wealth within the union which did not need to fund military expenditures. Once the Soviet Union crashed and burned, the EU could rapidly expand to bring former satellites of the Kremlin inside the club. Again, the existential threat to Europe having vanished overnight, allowed it to concentrate on rapid economic growth, presumably as a bloc, without concerning itself with military expenditures. Expansion was rapid, but then hints of political issues, based on national interests, began to rise to the surface.

The first clear sign of cracks in the unified system were political. The proposed constitution, a mammoth, 400 page tome, was seen by Eastern Europe – particularly Poland, as changing the rules of the game mid-stream. Ireland was the first to vote it down. Although eventually enacted, this document was not a constitution. It was another treaty. In other words, the constitution was a contractual relationship among individual nations. Contracts can be broken, but more importantly was the underlying glossed-over issue of nationalism that the European Union was established to abolish.

Then came Iraq. The key players in the EU, Germany and France, are also key members of NATO. They split, sharply, with the Bush administration over Iraq and the imperial attitude of that administration which flaunted a “with us or against us” childishness in foreign policy that made opposition to the war very, very easy. In no small part, Eastern Europe, and particularly Poland, supported US foreign policy because they needed a balance to the Franco-German alliance within the EU which was threatening to develop a robust relationship with the Russian Federation. European Union cohesion began to unravel at a faster pace.

Nationalism has now risen from the dead. France and Germany, both vying for a leadership position in Europe, appear to have subordinated the goal of the union to purely national interests. Germany under Merkel has increased its dependence on Russian energy supplies to an extent that makes it difficult to criticize, much less resist the more aggressive tendencies of Moscow. This is of particular concern to Poland and the Baltic States – EU members - given their prior experience of deal-making between Russia and Germany.
France has not mirrored the nationalism of Germany, but it also is clearly acting in its own interests when it announced the sale of one or more Mistral class ships to Russia – the first such sale of reasonably advanced military hardware by a NATO member to the Russian Federation. The sale – which has yet to be finalized – did not go down well in the Baltics, or in Georgia.

The Russo-German love affair has alarmed the Eastern European member states enough to send their governments into the bomb shelters of national interest as opposed to those of the EU. If the precedence of national over European goals is good enough for Germany and France, it is just as appropriate for Poland, Estonia, Lithuania, Latvia and Romania.

Greece tripped the nationalism wire completely. Andrea Merkel fomented an anti-Greek atmosphere in Germany for purely political, national reasons that made any sort of unified assistance by the other member states much more difficult. Germany, she clearly implied, would call the shots on any rescue plan. The Greeks were lazy, as compared to good, hardworking Germans, and could not be trusted. Her fulminations resulted in an electorate that not only does not care about Greece, but dislikes it. Now, when forced to lead the bailout, Merkel must backtrack – which resulted in the loss of an important bi-election and damaging her party’s ability to run the country alone. Hoisted on her own petard. And she is not alone in Europe.

Leaving aside the fact that the financial collapse of Greece was entirely self-inflicted, Merkel casually ignored the detail that German representatives occupy some lofty posts in the financial regulatory councils of Brussels who somehow missed the evidence of the approaching melt-down. Germany was going to run the show now for the good of Germany. The attitude was noted in Warsaw, Madrid, Rome and Ankara. The latter, though not a member largely because of the prejudices of the French, Germans and, as always the Austrians, has been given a taste of how it will be treated if the opposition to Turkish membership is ever overcome.

What has happened with the financial crises in the euro-zone is that Germany has essentially changed the deal - one member’s problems are not those of the EU. The union was established as an economic zone, and not a United States of Europe. Gradually, the idea of being a citizen of Europe took over. Without a deep crises, this political concept worked well despite the fact that it was never intended to politically integrate each member nation. With the financial crises in general and the Greek collapse and bailout in particular, the unity of the EU has been shattered despite the rescue plan. The entire episode firmly establishes the lack of a unified foreign policy within the EU. This inability to formulate a consensus approach in foreign affairs is not new. It has merely been below the event horizon for most of the last 50 years. Not any more. The interests of Germany, France, Poland and the southern tier of states are not congruent and in many cases are in direct opposition to each other.

From a foreign policy standpoint, the charade of a unified European approach as a balance to the US, however admirable, has vaporized. The election in the UK resulted in a coalition government, however long it lasts, that is led by a strong Euroskeptic crowd which the LibDems will not be able to overcome. Brussels will find it hard to maintain the appearance of unity, much less a unified foreign policy approach, in a firmly nationalistic Europe.

UK Coalition

I did not expect the LibDems to form a coalition government with the Conservatives. But there it is.  Any wager on how long these two incompatable groups will stay in the same room?  The defections to Labour may start very soon.  Election within a year.

How's that Hanging Working Out?

Hang, Hung, Hanged.

As the elections in Britain have resulted in an increasingly amazing kabuki dance among the Tories, LibDems and Labour, issues regarding the thrust of its international policies have become far murkier than a result of a clear victory by either Labour or the Tories would have produced.


The LibDems never had a chance of claiming a victory simply because the voting system is not proportional – a reason they are now negotiating with both the Conservative and Labour parties to form a loose alliance, in the case of the former or formal coalition in the case of the latter. Whichever party promises electoral reform gets the LibDems and a wins a cookie. Increasingly, that looks like Labour which is, in any event, closer philosophically to the LibDems on almost all issues, including attitudes toward Brussels. Nevertheless, the Tories did receive the largest vote and can credibly argue that they are entitled to form a government – minority or otherwise - and subsequently snub everyone across the Channel.

The debates touched on foreign policy issues in general and the EU in particular. David Cameron clearly would have pushed for a far more arms-length relationship, if that is possible. The current financial crises in the EU has only have buttressed the Conservative party position that the UK should not be under the thumb of the bureaucrats in Brussels or, not to put too fine a point on it, Berlin.

Nick Clegg and Gordon Brown are far closer in their positions regarding working with, or rather within, the EU. The ties with Brussels might be closer under a coalition government led by Labour but wagged by the LibDems; but, even this scenario is likely to be strikingly adjusted as a result of the negative public view regarding the EU’s stunningly discordant handling of the Greek financial melt-down, with its still vast potential for unravelling entirely and spreading rapidly. My guess is that the Labour-LibDem foreign policy position, should they form a “coalition of losers” as many Conservative MPs are characterizing this potential marriage of convenience, will be closer to David Cameron’s and the Tories than the LibDems’. In that case, relations with Brussels will enter a period of drift until the next election.
UK foreign policy regarding the US, Russia and China will remain the same under a Labour-Lib-Dem coalition – in other words Whitehall will continue to be largely ignored by the US except for Afghanistan, Russia will gradually enter the realm of polite discussion away from the children lest they be frightened and China will remain on the distant horizon of concerns.

Only one thing is certain. This will be the last of the old, first-past-the-post elections as the voters won’t tolerate a government with 36% support to have 150% of the power.

Conservative Minority Government

Polls in England are showing an increasing likelyhood that the Tories will grab a little over 300 seats.  Sound like a lot?  Well, actually, yes and no.  It is certainly short of the 326 needed to have a majority.  But, it is not so short that they couldn't form a minority government simply  because Labour and the Liberals together could not reach a majority.  Thus, it seems increasingly likely that my absolute judgement a few days ago that the Conservatives would win a majority may - I repeat - may have been a mistake. 

A minority government wouldn't last a quarter, which means another election.  That would leave policy - economic and foreign - in limbo.  If the Tories could take the 326 seats, then attitudes toward the eurozone would change and the EU can forget about closer ties. The EU response to Greece - led by the Germans - has not been wildly successful. That alone helps the Conservative position that the UK can be part of the EU but not controlled by it (or, shall we say, Germany). A full blown Conservative win will be a blow to the EU - not that it is undeserved.  Coupled with the mess that the Greeks have managed to conjure up and the potential fall of Spain and Portugal, a Conservative win might require Brussels to rethink its economic and political positions.

Still a day or two, however, to go.

Hiatus - sort of...

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The postings will be rare in the next ten days as I have some rather overwhelming matters to deal with at work.  I'll try and post during the next week on a number of items including the change of direction in Ukraine, internal threat to Georgia, the election in the UK (I predict a Conservative majority - no hung Parliament - but David is no Winston) and the crises of the Eurozone.