Strategy, Politics & International Relations Forum • Re: Geopolitics/Geoeconomics Thread - June 2015

In present and prospective conditions Europe (including the UK) cannot transfer large amounts of capital from welfare or civilian investment to defence without risking a social and political explosion. Therefore that transfer will probably not happen. 'Military Keynesianism' is simply a regressive transfer to an essentially parasitical sector, and to the rich. All that perforce might mean the eventual recalibration of policy towards Eurasia and, paradoxically, the apparent attitude taken by Trump (assuming it will not wind up being akin to Nixon's escalation in 1969 in search of peace) makes space for that, and also might give Europe the chance (a final chance?) to escape its present plight by means of the investment in the civilian infrastructure and productive capacity necessary to escape its trap, as proposed by Draghi.

Europe (including the UK) was able to hold its own in international affairs because of high levels of production for export, especially in the automotive sector, and the returns from those exports offset the fact that it lacks sufficient mineral endowments for its manufacturers, which it had to import. Those mineral endowments can now only be bought at a premium because of the sea change in geopolitics, specifically the stunning collapse of European influence in Africa and the Middle East. It is this collapse of influence which, arguably more than any factor (including the failure of investment in Germany) which accounts for the implosion of Europe's strategic autonomy, and its subjection to the caprice of US policy. European - specifically French - policymakers in the 1940s and 1950s realised full well that the preservation of European influence/predation in Africa was essential if Europe was to escape from US tutelage. That is why West Germany was very happy for France to be given special arrangements in Africa which effectively folded much of French territory within Africa into the economic orbit of the then EC.

The risk is that the decline in German manufacturing will become self-reinforcing, regardless of whatever tariff regime will be adopted. At present the problem is not only manifesting itself with the leading marques but more especially (and consequentially) with the rapid decline of key suppliers of parts to those marques - the mittelstand - often family enterprises, who are now selling out in large numbers. In this way we are seeing the Anglicisation of German industry, after the fashion of the late 1970s and early/mid 1980s. In addition, European-owned mining enterprises, which were able to secure discounted metals and rare earths from the Global South (especially Africa) have also been selling out, especially to Chinese investors. These, often rather hidden developments, have also had a major impact upon the evisceration of Europe's strategic autonomy.

Big beasts often thrash about before they die, and it is possible that if German vehicles are barred from the US market or are priced out of the Chinese market then Germany will seek to conserve its surpluses at the expense of debtor nations within the EZ (and the UK), which will result in a further poisoning of intra-European relations.

Statistics: Posted by S_Madhukar — 19 Dec 2024 17:29