Sometimes when I read over the news, I feel like I’m reading a shitty, sophomoric movie script. One of the first thoughtful articles I read after 9/11 was by Hunter S. Thompson; it pretty accurately predicted what was to come. My first reaction to the article: “Well… obviously.” I find myself sitting here today thinking the same. When I watched a cell video of the Eagles of Death Metal concert and heard the shots ring out, man did my heart sink. Those were my people going down. What happens next in Europe has already been happening for several years: the series of attacks Paris recently experienced will simply accelerate things. My intent was to keep it concise, but I can’t do this in tweets. I just wanted to write down what I was thinking now so I can take a look back on it in 10 years and, given what I was writing 10 years ago, probably laugh at myself. Buckle up.
An American Butterfly Flaps It’s Wings…
First let’s get some background, because I don’t think many people in the US have been paying careful attention to what exactly is happening right now in Europe. There is a general stress across the Eurozone economy right now due to flawed monetary policy which reared it’s head most obviously in 2008. Do you remember that financial meltdown and recession we had around then? Yup. We have to go back to that and start the story on our shores to understand what’s next in Europe. When I talk to people on the street about the “housing bubble” market crash, they’ll often wave their hand in the general direction of subprime real estate mortgages and the banks finding
illegal “creative” ways to re-bundle them for collateralized debt obligations. Now I’m going to REALLY oversimplify this here, because a lot of factors were in play that made everything a lot worse and discussing all of them requires it’s own post. With regards to the US banks as they relate to the European matters I want talk about, it was primarily a liquidity problem. Basically, the US banks ran out of cash. Essentially (and let’s be very clear that I’m oversimplifying) the banks were taking bad loans, bundling them into securities that were illegally mis-characterized, way overvalued, and so complex (by design) that nobody could understand them, and then they used those bogus securities as collateral to issue more bad loans. This went on for years. Then when the hyper-inflated real estate bubble popped and it became inescapably clear those loans would never be paid back, the bank realized they were in the red and the securities backing the bad loans were worthless. Europe was doing the same thing at the time, following our lead, and even heavily investing in those same bullshit securities bundles. So that’s how it started. The US created money out of nothing and bailed out the banks. The dollar and stock markets plunged. You know the reset of the story on this side of the pond… eventually things got better. (Actually… we still have a lot of problems but that’s a tale for another day.)
That’s really oversimplified but this is a long rant and we need to to get moving. I just had to briefly touch on the US crash to explain how the Eurozone economy was, is, and will continue to be, a radically different animal.
Eurozone Economy Pushed Past The Brink (…but don’t tell anyone)
The Eurozone economy is a lot different than ours. In the US, our southern states tend to have the worst education systems and be the lest productive. We have a transfer union in place… southern states receive more federal dollars across the board than northern states. Northern states in effect subsidize the southern. We’re all one big family, so despite grumbling from the Republicans things more or less work. Ironically, Republicans have the strongest presence in the south, so as long as they are the only ones complaining about being the leaches on our broader union it more or less works out politically too (since if they tighten up those subsidies and contracts they will be the only ones getting hurt). In the EU, we’re not talking about states, we’re talking about nations that think themselves sovereign. Whereas I can move to Alabama, California, Oregon, or New York and pretty much be in the same culture with the same rules, in the EU the language, culture, and economies of each member are very different. The housing bubble crash in 2008 did not cause the economic problems in the EU. It simply forced the EU to acknowledge the structural problems and address it: they’ve partially done the former and have, thus far, failed to do the latter. Each county has it’s own relationship to the other EU member states, but because I want to get to the attacks in Paris and why it’s so critical to pay attention without writing a book, I’m going to just use Greece and Germany as examples of the broader structural problems.
Lamborghini is owned by Volkswagen, FYI
Germany is productive as hell. Germans work longer hours, get better educations, and build more stuff. They export a ton.
They make more money per-capita. When the Berlin wall came down, it wasn’t simply that there were no jobs in East Germany; they didn’t have the capacity to make anything the west wanted. The west Germans initially wouldn’t hire east German workers because the ‘didn’t work as hard’ as their west German counterparts (decades of living in a communist country can really rob your motivation to go that extra mile, since it all pays the same). So Germany spent a fortune over a couple of decades
on infrastructure programs and other social programs to ‘reintegrate’ the easterners (though the verbiage abound that was spun to save face… the ‘Besser-Wessis’ were already having a culture clash w/ the Ossis and the German gov was sensitive to wording to avoid a political divide in Germany). Imagine a US program to overhaul the south, keep everyone employed for a decade, and get half of them through a university degree. The Greeks are in a similar position to the East Germans. They have joined a much richer, more productive “nation” called the Eurozone. However, their few exports aren’t even being exported anymore. For example, olive oil from Greece arrived in the US w/ labels off, missing, or damaged in the 90s. Despite the massive number of complaints they received from their clients abroad, the Greek suppliers did’t care. They spent nothing on upgrading their infrastructure over the last 20 years or so, and now Greek olive oil is #3 or #4 in the market. Italy and Spain, conversely, made major investments in their olive oil infrastructure and now have a better product. Moreover, Spain and Italy have the CAPACITY to produce more. Greek has actually LOST the capacity to produce as much olive oil as they did prior to joining the Eurozone… and even then they didn’t export a whole lot else. The market just passed them by, and the competition upgraded their plants and it would take Greece years to catch up if they even cared to… but there’s no sign of that happening even now. Instead, additional trade barriers have been put into place
Gets kinda crazy in Athens from time to time….
So how the hell is this happening and why isn’t anything being done? It’s time to look at how the Eurozone differs from the US running it’s “national” economy. First: The EU is not a nation. It’s a bunch of nations, and it’s in their “constitution” that one country being made to fund another is illegal. Imagine the US just cutting off social security to only Alabama. (Those leaches… smileyfacewinknod
) It couldn’t happen… but it’s law in the EU. In order to
“creatively” get around this, Germany used tax dollars to buy Greek bonds that will never be paid back. That money is gone.
Greece spent that money on generous social programs, huge subsidies for everything, early retirement for everybody, the largest per-capita public sector in the EU, 80% pensions for life, etc… without doing anything to develop their economy. The resulting insular policies and decoupling of business from performance over 2 decades eroded the Greek economy to a shadow of it’s former not-that-spectacular-to-begin-with self. After so long, the debt grew to levels no economist could deny was un-payable by the Greek government. The German people realized they were paying for all of this, and understandably got pissed. (Small asside: this wasn’t JUST Germany and Greece – this same drama played itself out in numerous permutations and combinations across the EU, and involving all members. I’m using Germany and Greece here as just an example, and I’m oversimplifying things a bit just to get through this blog postzilla.
) Something had to give, and the Greek creditors and other EU nations got together and told Greece that they could hand over sovereignty, make specific changes to their economy
, cut pensions, end early retirement, and adopt a laundry list of other measures, or they were cut off and would have no money at all for their banks
or anything else. For two weeks or so the Greek banks shut down while the Greek politicians who were making impossible claims and promises for all those years got together and tried to figure out how they could keep their jobs. God knows nobody else was hiring in Greece, so they capitulated. Now things are even worse in Greece and the economy will continue to contract… because Greece can’t print magic money like the US can.
While I acknowledge that the bankers ran everything into the ground, it wouldn’t have been possible without the dedicated support of corrupt politicians and their unsustainable economic and social policies. In my opinion, this is a minor issue in relative terms compared to what has happened with Greek society and their view of the fundamental problem. Iceland’s rise and fall and re-rise (sorta) was made possible by a few factors not present in Greece. For one, the problem was a lot smaller in absolute terms. Dragging them along to pay an impossible debt might have given other nations warning… so it’s not in the bankers interest to protract things. Iceland is also one of the best educated nations on the planet per capita, and ranked #1 in the world for peacefulness in 2012. That makes it a good place to do business. The rest of the Icelandic economy was intact. Fishers can still fish, aluminum miners can still mine, players can still play, haters can still hate… getting off track… and CCP is still making internet spaceships. I think Bjork even came out with an album somewhere in there (non-fact: Bjork represents 10% of Iceland’s economy). Iceland threw their bankers in jail and just went back to what they’ve always done. In Greece, with the exception of tourism and shipping, the rest of the world has passed them by and took over a lot of their market. It’s going to be quite a challenge to bring them back to Greece (but I think they could do it if the will was there).
The EU can’t just give Greece free money. If they did, everyone would want free money. Then everyone would be Greece, and nothing would get made. So now let’s take a step back and look at the larger union. Most countries are not as productive, and thus as rich as Germany. You have to accept a lower standard of living in other countries as a result. The people don’t like that. In fact, all over EU, there are frequent riots, mostly by people who work in the public sector or by people in industries that are tightly regulated and controlled (often in very corrupt fashion) by their respective governments. As a result, a lot of these other countries are basically running like Greece, albeit in slower motion. The problem of so-called wealth redistribution is even ripping some member nations apart from the inside out. In Spain, the north is far more productive and wealthy than the south. There’s no analog in the US. It’s more like comparing Texas to Mexico. The region of Catalonia has just voted to secede from Spain and form a new country. Obviously the Spanish courts aren’t having it, but it’s not hard to see why Catalonians want out. Most of their tax dollars are spent on other people. Within Spain, there is a really uneven wealth redistribution system, and the people that work more are really pissed about it. It’s the same amongst the EU nations. Poor nations are aggravated by other countries getting preferential treatment. Rich nations don’t want to shovel money into other countries social programs. Everyone is ready to spend someone else’s money. Economies are tanking or stagnant, unemployment is at record highs, and the future looks a lot worse. Things are not getting better, and the EU policies aren’t changing. This is the moral hazard of the EU, and it’s pulling the European Union apart.
The financial crisis in our country is not a passing storm. Given the size of the problems, our national effort will not be completed in 2012. It will take many years and will require the efforts and insistence of several governments. ~ Lucas Papademos (former Greek PM)
The economic woes of the EU are fundamentally structural, and they are systemic. Addressing them requires wildly unpopular measures (pension cuts, social program cuts, reducing public sector workforce, etc…), votes in every EU member nation’s parliament (this includes all EU member nations OUTSIDE of the economic Eurozone; they have to get everyone on board for everything), and dramatic political action from politicians who have for the last 20 years gone to the greatest lengths to avoid any action at all. What’s going to happen: pretend and extend. The hole is going to get deeper and deeper until it implodes. As we saw in our Greek example, the politicians were STILL promising that everything was going to be fine when the banks RAN OUT OF MONEY and shut down. They promised the people their money was safe in the bank! AND PEOPLE BELIEVED THEM! I laugh… but it’s really sad. …and yes I’ve been giving Greece a hard time but the truth is this: The European governments are all pretty much the same. Some are just a little worse than others and some are just richer or poorer, but when the chips are down we have example after example demonstrating that ALL the governments in the Eurozone will lie through their teeth to the people, right up and through any crisis.
So… that’s the economy in a way over-simplified nutshell. There’s a storm brewing, but it’s still a few years away I’m guessing. However, it’s important to understand what is happening with the economy to understand why so many solutions to the problems I have yet to touch on won’t work. This is why I couldn’t just “tweet” some bullshit. It is a long story, but I think it’s an important one. So now lets talk about immigration and Syrian refugees.
Ideals Trump Reality: Immigration Crisis Sans Border Controls
The economy is shitty and a lot of people are out of work. The last thing most EU countries need is more people… there legitimately aren’t enough jobs to go around already. However, ‘more people’ is exactly what they are getting… a lot more. Again it’s hard to write with an American audience in mind. In the US, the tendency is to try and equate the immigration crisis in Europe with our own immigration problems. …again, as with trying to compare economies, doing so provides a wildly inaccurate analog. The US immigration debate is nothing at all like what the EU is facing right now. I’m not going to rehash what that Wikipedia article already explains because I can’t do a better job. The gist is this: millions of people are flowing into Europe. Europe has open borders and people, when granted asylum, are free to go where they like. However, only some of the refugees seek asylum. In fact, much less than half are granted asylum. If asylum is not granted, now they are on the European radar… and generally they are shipped back to their country of origin. That really sucks when half the people back “home” want you dead and the other half want to conscript you into their army. This discourages applications for asylum, and as such I think it’s reasonable to say that the official migration numbers are probably somewhat muted relative to reality. In April of this year almost 2,000 people died in a few over-capacity boats trying to bring people into the EU illegally (this was just one incident). 22,000 people are estimated to have died on the voyage between 2010 and 2014. …and poor Greece! They are having such a hard time right now, but for the same reason they dominate shipping in the EU, they are having to deal with the vast bulk of refugees touching down on European soil for the first time. The Greeks simply can’t handle it. They are totally overwhelmed.
When refugees roll into any given city, they often can’t speak the language, and if they aren’t put into a refugee camp (completely quarantined from the civilization around them) then they end up in slums which are predominantly populated by other refugees (so only partially quarantined). It’s hard to make a rational attack on their failure to assimilate without considering the lack of opportunities for assimilation. The living conditions in both the camps and slums is horrid. They live under bridges, in landfill areas, and even in the slums of Paris many live in buildings without running water (and these are the ones granted asylum). It shouldn’t be shocking to learn, than, that the safety of the locals is at risk. There have been many incidents around Europe wherein refugees attacked motorists driving by the camps, people living close to the camps, or local officials and camp workers. The headlines sure do make waves, but the media, I think, is keen how delicate the situation is and hasn’t been widely covering the refugees rioting, or for that matter, the Europeans who are starting to attack the refugee camps. (Videos like this of refugees on a train in Paris don’t help, but certainly fuel the nationalistic fire.) TL;DR; There’s a little friction between the old locals and the new locals, but I’ll comeback to this tinderbox a bit later.
The world is not divided between East and West. You are American, I am Iranian, we don’t know each other, but we talk and we understand each other perfectly. The difference between you and your government is much bigger than the difference between you and me. And the difference between me and my government is much bigger than the difference between me and you.
And our governments are very much the same. ~ Marjane Satrapi
Maybe these refugees need to get a damn job… amiright? Well… they can’t. In countries with high unemployment, people with the best skills for the job don’t actually get the job. Put yourself in the shoes of the business owner: You have a bunch of dependents without jobs that are living with their other family members. They eat your food and draw on your resources. The worse it gets, the more family members show up at your door. You can’t turn them away because they are family, but you can’t afford to support them either. As a result, you hire them to work at your company because that’s one less drain on your resources. IF you absolutely have to hire a person with a specialized skill set, why not someone who speaks the language and has something in common with your customers culturally? I’m not saying it’s right or wrong, I’m just saying that’s what is happening.
Border controls, or rather the lack thereof, are also a big problem. The dream of Europe, aside from a single currency, was predicated on open boarders. Opening the boarders is, rightfully, a huge source of pride for the architects of the European Union: a sign that inter-European peace was finally tenable and that every member of the EU was (more or less) on equal footing and held in equally high regard. It was a sign of trust between governments and a device by which Europeans could better learn about and identify with one another. It achieved those goals (for the most part… probably). However, poor boarder controls with non-EU nations in any one country effectively means that all countries in the EU have poor boarder controls. The ‘weakest link in the chain’ analogy is appropriate here. The flow of migrants into Europe has been increasing steadily for a long time. Now it seems to be almost exponential. It’s not just Syria, and this didn’t just start to happen when Syria fell into civil war. This is a pretty good article on the flow of immigrants from all over the middle east and Africa (with maps!). The so-called “Great Migration” into the EU has been a politically difficult issue to address, because addressing it goes against the idea of a completely open and free Europe. As with anything difficult and politicians globally, if a thing is hard it’s better to do nothing for as long as possible and keep your job for a few more years. Welp. Europe is doing something now. The boarders are shutting down. France sealed theirs, Hungary is putting up razor wire, hell even frickin’ SWEDEN is starting to lock things down. To me this represents a few things. 1) The citizens of the nations shutting down their boarders feel like they can’t count on the EU to solve the problem. This reinforces nationalism and by extension an “us (an incidental nation) vs. them (the rest of the EU) vs. them (the refugees)” mentality. This is obviously not conducive to an integrated union. 2) EU membership did not require adoption of the Euro, or necessarily all of the EU rules; only a statement that the applying nation would continually move towards and eventually adopt all of the rules. One of the more critical rules was the EU’s Schengen Agreement, which grantees freedom of movement. Every nation that goes back on that is moving away from European integration, and almost every nation is starting to do just that. As a symbol, this sends a powerful message to the people: ‘Now’s a good time to pick sides.’ 3) It also shows that the politicians in each country no longer trust one another. I would argue that mistrust is very well founded, but still, they have to see that no partnership can exist without trust. Sadly, it’s too politically convenient to be a populist and placate your base (also: it’s profitable). Nobody seems to be particularly concerned about the bigger picture, at the moment.
In any event, the massive refugee migration and Europe’s unwillingness to even address it (until the Paris attacks… sort of) has given rise to a situation wherein mistrust amongst EU nations is growing and the EU as a concept is receding. All of the EU governments are having serious problems identifying, housing, and providing for the needs of refugees. The refugees are irate about their living conditions (which suck) and are having major problems assimilating into the new culture. If all you knew was the Assad regime your whole life it would be like living on an alien world for you too. The old locals are tired of the refugee riots, the unrestricted immigration, the lack of jobs, and the ineptitude of their own governments. Tensions were high before Paris. They have been building for a LONG time, and the radical nationalist parties in most EU nations are growing rapidly.
Sometimes You Just Gotta Swing A Cactus Around…
Now lets take the refugees out of the equation for a bit and talk about the native European climate of civil unrest. They are mad about a LOT of shit! I honestly have no idea where to even start. Again, as with most of this post, I’ll but scratch the surface on any of it, but here’s a few random examples:
- France’s violent taxi strike over Uber: Basically in Paris you have to pay a huge bribe to the government to drive a cab (incidentally it’s the same in New York). With Uber, anyone could become a taxi driver. The taxi operators hated the competition and the fact that they were having to pay for their “operator’s licence” without getting the exclusivity that comes with that, so they parked their cars in the middle of the busiest streets and started attacking and flipping over Uber cars.
- Police brutality riots in England: Police shot an unarmed 29-year-old who was black. People started throwing bottles at the police, they engaged, and then the protesters started to loot, light buildings on fire, destroy mass transit… you know, the usual stuff. This spread to over a dozen cities, with thousands taking part.
- Anti-globalization riots in Spain: Barcelona saw 20-50,000 demonstrators pour in from across Europe to protest the EU’s attempts to liberalize energy and financial markets.
- Anti-austerity riots in Spain: Remember when we talked about richer nations giving poorer nations free money? This was about that. Spain’s credit rating was dropping so they had to start cutting things. They simply could not afford their social system. Tens of thousands descended on Madrid to frak shit up.
- Students and riot police clash during anti-austerity protests in cities across Italy: ibid? Can I do that? You bet your ass I can.
- Violent clashes break out in Rome as Italian opposition to migrants increases: Yup. Italy isn’t alone… this is happening all over Europe. Google is your friend, there’s too many of these to list. There have been groups of migrants rioting against the police and attacking locals, locals attacking migrant camps and singling them out for beatings, police randomly arresting or abusing migrants… there’s a lot of vitriol on both sides of this thing.
- Greek general strike: Petrol bombs and teargas during anti-austerity protest: So. So. Many of these. Riots like this have been going on for years and years in Greece.
- Anti-Austerity riots in Germany: “Blockupy is a coalition of more than 90 groups from across Europe, including the Syriza Party, which now governs Greece.” Germany outsources everything now.
- French police clash with climate change protesters: This happened just a couple of days ago. The title is pretty self-explanatory.
- Portugal protests against austerity: Again… massive violent riots. There were/are a lot of these across the continent.
So… why am I bringing this up? To me it indicates a rising sense among the citizenry of these various EU nations that rule of law is not getting the job done. The people don’t feel a sense of control over their government… even when they vote new people in, policy stays the same (I think we can relate…). They don’t feel like they have control over the forced changes in their lives: technological advancement, globalization, sane economic policy, fair wages and work, the list goes on… but the key here is that this sentiment seems to be on the rise. Now, in my humble opinion, across the pond and sitting safely at my keyboard, some of their concerns seem perfectly reasonable and others are completely short-sighted and stupid to me. My opinion doesn’t matter here. Regardless of the validity/veracity of various populist positions and passions, what I think is important to note is how they are being expressed, by what numbers, and at what frequency. They are expressing their positions violently. Their numbers are growing. The frequency of these events is increasing.
Nationalism is an infantile disease. It is the measles of mankind. ~ Albert Einstein.
The rise of extreme right nationalism in the EU has been on my radar for quite some time now. Why, it seems like just yesterday (2009) the little Golden Dawn party, a neo-facist group out of Greece, couldn’t get a single official into their own ~300 person parliament. Look how much they’ve grown! They have around 24 members in Greek parliament and 3 members in the EU parliament. Yup. That’s official Nazi representation in the EU. How do they do it? Same as the Nazis. Where there are no police in Greece, Golden Dawn provides security. Great if you’re Greek, potentially deadly if you are not. If you are hungry and Greek they’ll give you food. If you’re not of course you’ll get the baton. It’s starting to play well to a political base looking for an easy scape goat. The National Front party in France, a similarly far right nationalist party, scored over 17% percent of the vote in the most recent presidential election. Moreover, they seem poised to take some regional elections post the Paris attack. Straight up neo-Nazi’s in Spain are making their rounds, and Golden Dawn just opened up an office there. Mussolini’s Italian fan club is experiencing a strong revival as well, with fan-club president Benito Mussolini considering a presidential run as he sees his polling numbers rise. (Side note: If you look really, really, carefully, you might just see some of these groups having shared qualities with other politicians around the world.)
So how did this happen?
How did it happen last time? Shitty, disproportionate, highly corrupt economy. Not enough jobs. Bleak prospects for the future. A strong sense of powerlessness amongst the citizenry. An equally strong sense of public entitlement divorced from economic reality. Political chaos and increasingly protectionist/isolationist policy. Rising nationalism. Unregulated waves of migrants coming in. Terrorism. Fear. …and a bunch of assholes who promise a magical ‘final solution’.
That brings us, at long last, to:
The Terrifying Thing…
The EU is not the United States of Europe. At all. These countries have distinct languages and cultures that stretch back through centuries of unrestricted warfare. The people of these nations very much identify with their respective cultures. Part of the EU dream was to create a melting pot of cultures. What follows politically, militarily, and culturally will determine how successful the project has been.
However, the attack on Paris was an attack on a people; on the very idea of pluralist, secular culture. It was an attack at the core of what the EU is supposed to be about. The attack was conducted by people who blended in with the migrants, by others who were traveling legally, and by European nationals who sympathized with radical Islamic ideals. So, against the backdrop and context I’ve provided, you might expect to see a spike in ultra-nationalist support across the EU, increased anti-immigrant sentiment, increasingly tight boarder controls and more invasive domestic surveillance. Indeed, that is exactly what we are already seeing.
In better times we could expect rational discourse to prevail. People would realize this isn’t a black and white situation… but the people may be too overwhelmed. The build up of anti-immigrant emotion in and effort rationalize a bad situation could turn the Paris attack into a significant catalyzing event. The Nazi party took it’s first office around 1918, and didn’t take over Germany until 1933. That’s 15 years for math challenged individuals, such as myself (I used a calculator). Golden Dawn took it’s first 21 parliamentary seats in 2012. I don’t claim to have the solution… I just hope the one that Europe finds isn’t… “final”.
….and that’s the terrifying thing about Paris. Juggalos reprezent woop woop!
LINK STREAM 151201:0721Z
This is fascism, and we should say it clearly … while we can
Hitler’s Mein Kampf published in Germany, 1st time since WWII
Six in ten jobless will be foreigners by 2017
Denmark & Sweden Now Imposing Border Controls
Has Europe Reached The Breaking Point?
[New York Times Feature]
France: President Francois Hollande seeks to extend state of emergency until Isis can be totally defeated