Teutonic Arrogance

ATHENS/BERLIN (Own report) – German politicians are reacting to the Greek government’s call for a partial remission of its debts and its throwing the EU-Troika out of the country, with ultimatums. “Tsipras had better cease his attacks on Angela Merkel,” threatened the European Parliament’s President Martin Schulz (SPD). “Beating up on the Germans” is “shortsighted.” State-financed German media organs are castigating Greece’s newly elected head of state as “obstinate” and complaining that he “is jeering,” “Germany is only one country among others.” US experts warn that in the EU’s crisis countries, the German austerity dictate has resulted in “a level of misery” “that surpasses the limits of tolerance for a democratic society,” and suggest that Greece be dealt with pragmatically – a partial debt remission along the lines of the London Debt Conference 1952/1953 model. Two years ago, Greece’s new Minister of Finance Giannis Varoufakis had already called on Germany to shift from an “authoritarian” to a “hegemonic policy” that would not use its economic power to hold the EU countries down, but to allow them to participate in the hegemonic benefits, as Washington had once done for the Federal Republic of Germany with its Marshall Plan. Varoufakis wrote explicitly, “Europe” does not need an “authoritarian” but “a hegemonic Germany.”

Merkollande takes the controls

German Chancellor Angela Merkel and French President François Hollande want to install a government for the Eurozone. This could change the EU’s structure, according to the press in both countries, but only if the leaders’ understanding is sustainable.

Angela Merkel and François Hollande have made up. The “Franco-German contribution,” announced on May 30, shows that the German Chancellor now supports the French President’s proposals concerning the governance of the Eurozone. French financial daily Les Echos notes that:

Beijing sows discord among Europeans

Yet again, Europe brings its split ranks to the negotiating table. Yet again, Berlin wants to lead with a project different from what the European core wants, and yet again, China will be the winner.

China is defying the European Union. It is testing the ability of the 27 member states to maintain the only common policy that actually exists – the trade policy. Europe exists on the international scene as a unique entity in one capacity only – trade. Will the Europeans throw in the towel on this issue also?

Partner Nation Russia

From a historical perspective, the last two times Germany and Russia went down this road of ‘partnership’, and eventually non-aggression pacts, it led to two world wars.

HANNOVER (Own report) – The German Chancellor and the Russian President attended yesterday’s opening of the annual Hannover Industry Trade Fair. This year, Russia was the fair’s chosen “partner nation,” a move to help promote German-Russian economic relations. The German Committee on Eastern European Economic Relations announced a German-Russian economic summit to be held today. Since the SPD/Green coalition government encouraged the economic cooperation ten years ago, the trade volume has grown from 15.1 billion Euros in 1998 to more than 80 billion in 2012 – to Germany’s advantage. Germany is ensuring its access to energy resources from Russia’s huge deposits, while also tapping into the lucrative market for the German export-oriented industry. The German industry needs this market, since its sales to the southern Euro zone are tapering off, due to the economic crisis. Berlin is also seeking to boost this cooperation because of China’s growing influence in Russia. Moscow and Beijing are not only planning to expand their bilateral economic relations, they are also increasing their political and military cooperation – at the expense of Western hegemony, as seen from the German perspective.

No backing down: Germany comes out swinging over claims it is the neighbourhood bully

Given all the Germany-bashing over the last week, in the wake of the Cyprus bailout deal (some of it completely ridiculous), it’s easy to forget that the Germans themselves are remarkably united over the agreement. In fact, the feeling is that Germany, collectively, just got a fair bit more assertive over its eurozone policy.

On Friday, before a new agreement was finally reached and with Cyprus’ euro membership on the line, German Chancellor Angela Merkel – reportedly in an angry mood – told MPs from her coalition parties that it was wrong for Cyprus to “test” Europe and that while she preferred to see to see Cyprus stay in the single currency but was prepared for an exit.

Cyprus a Vassal State of the German Empire

A woman holding dual nationality walks with placard reading ‘No to the 4th Reich’ outside the parliament in Nicosia on March 24, 2013. (PATRICK BAZ/AFP/Getty Images)

 

During the early hours of Monday morning, EU leaders agreed to another bailout for Cyprus. The island will receive the €10 billion (us$12.9 billion) it needs to avoid collapse without most Cypriots having money removed from their bank accounts. But Cyprus’s economy has been destroyed. The nation is left as a vassal state of the new German empire.

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The deal will be painful for the whole economy. Last week, German Chancellor Angela Merkel said that Cyprus “must realize its business model is dead.” The latest bailout has ensured that realization.

Gerald Warner: Cyprus caught in proxy war between old enemies

When Angela Merkel – to cut out the middlemen – feels entitled to arrest the bank accounts of individuals and institutions in another country and help herself to 10 per cent of their deposits, then the rule of law has become a folk memory in German-occupied Europe. Is this what was meant by negative interest rates? The sheer irresponsibility of risking a bank run, not just in Cyprus but ­potentially in Greece, Spain, Portugal, Italy and everywhere else the dominoes might ­topple, betrays the stupidity of those ­shoring-up the deluded euro project.

Merkel Advisor Feld: “Euro Crisis Will Return Shortly And With A Vengeance”

For all the groundless, starry-eyed optimism permeating Europe’s bureaucratic corridors of the fading oligarchy these days (because this time is not like every other time that, too, was different), there has always existed one sure, never-fail antidote: Germany, which without fail has managed to ground Europe any time its delusion of grandure hit escape velocity. Sure enough, while all the statist soothsayers who threatened with armageddon if the outcome of the Italian elections happened to be precisely the one that transpired, were stuck in backpedal mode, and scrambling to calm nerves that all shall be well after all, one person who refuses to play by the script is Lars Feld, member of panel of economic advisers to German Chancellor Angela Merkel, who in an interview with the Frankfurter Allgemeine Zeitung tomorrow says the euro crisis is to return shortly and “with a vengeance” as capital loss will lead to higher risk premiums for Italy’s interest rates.

Germany to Cyprus: Terms of Surrender Not Good Enough

Cyprus is nearly conquered land, but as said, it’s part of a larger picture. It gives strategic access to project power into the Middle East. The Greek islands Germany has shown interest in the last five years or more also serve the same principal.

The German Parliament and European Union officials are refusing to support Cyprus’s bailout unless the country submits to further conditions. They’re accusing Cypriot banks of making dodgy deals with shady Russian businessmen, and they want this to stop.

Shortly before the end of last year, Cypriot President Demetris Christofias announced, with “heartfelt pain,” that Cyprus would seek a bailout from the EU. He said that terms had been agreed “in principle.” Spiegel Online wrote that the deal means that Cyprus “will effectively lose its sovereignty.” The “troika”—the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF)—“will essentially take control of the Mediterranean island,” it wrote.

Now we’re seeing that in action. Germany’s parliament is refusing to give Cyprus the money unless it changes its banking system and cracks down on money laundering.

A report by Germany’s intelligence service, the BND, that was leaked last November accused Cyprus of creating the perfect conditions for money laundering. It also said the country was giving Russian oligarchs Cypriot passports that allow them to live anywhere in the EU.

Only Misunderstandings

ATHENS/BERLIN (Own report) – Amid mass protests, the German Chancellor visited Athens, Tuesday, to promote new opportunities for German companies. The privatization of state enterprises and infrastructure must be accelerated, was the demand in Berlin even preceding Merkel’s visit. The Chancellor remembers all too well how the German Democratic Republic’s enterprises were liquidated, and therefore knows how to pluck out a country’s industrial filets to sell them off to profit-seeking investors. Interested Germans such as those in the Chancellor’s delegation will be in a privileged position, through the creation of “special economic zones” in Greece, which has been Berlin’s long time demand. A spokesperson for the German government recently commented on the effects of the German austerity dictate, which has led to the impoverishment of the population, saying “we have succeeded in reducing the unit labor costs by double-digit percentage points.” Foreign policy experts in the German capital attribute yesterday’s mass protests to “misunderstandings” and recommend that Berlin undertake targeted PR measures, to impede future resistance to German policies of domination. They allege that the Greek population is “badly informed,” but has a right to “comprehensible press releases” for more in depth explanations of the German austerity policy.

Part 1: German Investigators Uncover Illegal Exports

A ‘Focal Point’ for Procurement

Iranian-German collaborations have a long history. For many years, companies like German engineering giant Siemens played an important role in the construction of the Iranian nuclear reactor in Bushehr. German mechanical engineering companies rank among the best in the world, and their products are highly coveted by engineers in Tehran. A recent confidential situation report by the German Customs Criminal Investigation Office (ZKA) said that Germany is a “focal point for Iran’s procurement activity” by Iran. The report went on to say that “preventing illegal exports” represents “a key challenge.”

Sales of banned high-tech products boost the Iranian nuclear program, but they also threaten the German government’s policy, which is largely relying on tight export restrictions to head off a war in the Middle East. The means “at our disposal to force Iran to be more transparent have not been exhausted,” says German Chancellor Angela Merkel, adding that “sanctions are at the top of the list here.”

Full article: Part 1: German Investigators Uncover Illegal Exports (Spiegel Online)

See also: Part 2: Valves from Germany (Spiegel Online)

Germany Says ‘Great Uncertainty’ About US Debt

German Finance Minister Wolfgang Schaeuble questioned on Tuesday how the United States could deal with its high levels of government debt after November’s presidential election.

In a speech to the Bundestag lower house of parliament to open a debate on the 2013 German budget, Schaeuble said worries about U.S. debt were a burden for the global economy, hitting back at Washington which has criticized Europe for failing to get a grip on its own debt crisis.

In private, German officials often express concern about U.S. debt levels and the inability of politicians there to reach a consensus on how to reduce it, but Schaeuble’s public remarks underscore the extent of the worries in Germany.

Full article: Germany Says ‘Great Uncertainty’ About US Debt (CNBC)

Merkel Backs Two-Speed Europe With Core Euro in Poke at Cameron

As has been discussed in previous posts, Europe is looking like it’s heading to a two tier system economically and politically. Top tier nations will be seperated into a collective of 10 or so while the remaining will reside within a periphery system, most likely for providing cheap labor. What’s also seems will happen is the creation of a two tier currency system to go along with the two tier economy. For example we could see a Euro A class and a Euro B class form of currency. Another future possibility is the return of the Deutschmark with the core nations formally adopting it while the periphery nations holding on to the Euro. It would likely be the best option with the least damage should Europe continue pushing for further integration. Meanwhile, resistance from Great Britain indicates not all are willing to subjugate themselves to Brussels/Germany. In fact, British Prime Minister Cameron suggests this is an opportunity for the unwilling to go back to the way they were before the EU formed: Sovereign nations.

German Chancellor Angela Merkel said that she supports a two-speed European Union, with a core group in the euro pressing ahead with deeper integration and the U.K. among the others relegated to Europe’s margins. Merkel’s comments, made as she prepares to host British Prime Minister David Cameron in Berlin today, underscore her differences with the U.K. leader, who is pressing for more aggressive action by euro countries to counter the financial crisis roiling the 17-nation currency zone. “Those in a monetary union will have to move closer together,” Merkel said in an interview with ARD television broadcast today. “We have to be open. We always have to make it possible for everyone” to join. “But we must not stop because one or the other don’t want to come along just yet.” … “We need more Europe, we need not only a monetary union, but we also need a so-called fiscal union, in other words more joint budget policy,” Merkel said. “And we need most of all a political union, that means we need to gradually give competencies to Europe and give Europe control.” Ceding more control to Brussels is anathema to many lawmakers in Cameron’s Conservative Party, more than a quarter of whom defied the government in October and voted in favor of a referendum on continuing British membership of the EU. Cameron said the following month that the euro crisis offered an opportunity for powers to “ebb back” from Europe to nation states. “We should look skeptically at grand plans and utopian visions,” Cameron said then. “We’ve a right to ask what the European Union should and shouldn’t do.” Merkel, in her television interview, said that EU leaders at a summit later this month will discuss a plan to transform the EU into a political union. Still, a breakthrough can’t be achieved at just one summit, she said. “The economic and political division between the Anglo- Saxon world and the ‘Germano-sphere’ is increasing,” Fredrik Erixon, head of the European Centre for International Political Economy in Brussels, said in a telephone interview.

Full article: Merkel Backs Two-Speed Europe With Core Euro in Poke at Cameron (Bloomberg)

Exclusive: Obama weighs action to prevent Al Qaeda grabbing Syrian WMD

US President Barack Obama, though widely expected to pursue direct action against Syrian ruler Bashar following the Houla atrocity, is preoccupied with what he regards as a greater threat to the world: a potential grab for the huge Syrian stock of chemical and biological weapons by Al Qaeda’s or other terrorist organizations. This is reported exclusively by debkafile’s Washington and intelligence sources.

The US president is trying to persuade Russian President Vladimir Putin to accept his new plan for the immediate assignment by the UN Security Council of 3,000 armed monitors to Syria to take charge of the six chemical and biological stores. Another 2,000 will join the team later.

To allay Putin’s suspicions of a trick to insert Western armed forces into Syria against Moscow’s will, Obama suggested that most of the monitors would be Russian or nationals of governments lining up with its support of the Assad regime.

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Obama warned Putin that the jihadists have never been so close to getting hold of large quantities of such deadly unconventional weapons, especially now that the Syrian army’s 4th Division, commanded by Assad’s brother Maher, which guards those stores, is additionally assigned with suppressing the revolt and therefore inadequately manned for securing them.

If the Russian President buys his plan for 5,000 international monitors to take over the security assignment, Obama hopes he will also persuade Assad and even Tehran to accept it.
Early Thursday, May 31, the US president held a video-conference call on the subject with German Chancellor Angela Merkel, French President Francois Hollande and Italian Prime Minister Mario Monti, to brief them on his initiative and his talks with Putin.

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The Russian president has not yet given Obama his answer, still suspecting an American ruse for placing Western troops inside Syria. Hence his spokesman’s statement Wednesday: “Russia is not considering changing its stance on Syria and any attempts to apply pressure on Moscow are hardly appropriate.”

Tehran, taking this to mean that Putin has not rejected Obama’s proposal, was put out enough for a forceful threat: “Western intervention in Syria would result in a regional upheaval that would undoubtedly engulf Israel,” said Iranian parliament speaker Ali Larijani. “It would spread to Palestine and ash rising from the flames would definitely engulf the Zionist regime…US military officials should be aware of their dangerous game.”
This was taken by sources in Washington as an Iranian threat to burn Israel if Obama’s plan to post 5,000 armed monitors in Syria goes through. Iranian sources told debkafile that the threat was aimed equally at deterring Putin from cooperating with it.

Full article: Exclusive: Obama weighs action to prevent Al Qaeda grabbing Syrian WMD (DEBKAfile)

Euro Officials Begin to Weigh Greek Exit as Euro Weakens (Update 1)

“We’re really getting to a denouement,” Michael O’Sullivan, head of portfolio strategy at Credit Suisse Private Banking, said today in a Bloomberg Television interview. “We’re getting to the part where a decision has to be made” on whether Greece leaves the 17-nation currency union, he said.

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A Greek departure from the euro could trigger a default- inducing surge in bond yields, capital flight that might spread to other indebted states and a resultant series of bank runs. Although Greece accounts for 2 percent of the euro-area’s economic output, its exit would fragment a system of monetary union designed to be irreversible and might cause investors to raise the threat of withdrawal by other states.

Full article: Euro Officials Begin to Weigh Greek Exit as Euro Weakens (Update 1) (Bloomberg)