- Category: Geoeconomics
- Hits: 3,054
Europe is shifting its borders eastwards again. This time it must not overstretch. In the thirteenth century, various Mongol tribes made Europe insecure and reduced its size: the Golden Horde took Kiev in 1240, spreading their terror as far west as France and Spain, the Seljuks conquered Constantinople in 1253. It has taken us 750 years to regain stability in Europe, delayed by disastrous adventures led by short men: Napoleon, Mussolini and Hitler. Now we must consolidate.
We are undergoing a revolution in Europe. At the same time we are in a period of transition and doubt. The new common political system is not yet in place and suffers from systemic problems; size, inefficiency, and inequality. These problems must be overcome.
There is not one Europe but three:
- Western Europe : secular, democratic, the Europe of the positivist sciences, of progress, Christianized Europe forming the Latin pole, which was ruled from Rome, in accordance with the ideology of St Augustine (who himself was a Kabyle, a man of the Berber people – the pride of Tunisia).
- Orthodox Europe: the Europe of the Serbs, the Europe of the State church, of authoritarianism and fortifications. They use Greek or Cyrillic script. Serbia, Montenegro, Macedonia, Kosovo, and Albania: these cultures are all influenced by the Turks, latecomers to Europe, poorly integrated. This is the Byzantine Europe which never stabilized. Greece today is suffering from its past influence.
- Then there is Russian Europe, which was born out of Byzantine Europe via Kiev and destroyed by the Mongols in 1245 – the same Mongols who ruled Russia for three hundred years. It was a period of violence, brutality, bloodshed. All these events have shaped the Russian character. In Russia we see a generous society, full of compassion, but unpredictable, capable of killing the very next day. This is the Russian–Tartar world, which stretches all the way to Vladivostok.
Europe runs at four speeds:
- Atlantic (high-tech)
- German (mechanistic), Baltic, and Eastern European
- Balkan, parts of Italy, Greece.
The EU of today is all but accidental, and its borders no longer match religious and ethnic boundaries. The EU has yet to come up with a common foreign policy. Without it the Union will keep losing ground visa- vis the USA and China. The Lisbon Treaty is the first vital step.
Europe and the EU will rise again after its debt problems, but it will be on new and more realistic lines. In today’s Europe of 450 million inhabitants, twice as many speak German as French. German-speaking Europe has direct access to Byzantine and Russian Europe. The French have direct access to North Africa. It is obvious who has the geopolitical advantage. It means that the French must work twice as hard if they want to compete. Instead they will continue their decline among world powers, rescued mainly by the Chinese’ demand for luxury products.
With the new EU member states there will be a clear shift eastward, among other things for the location of the common European institutions. The economic centre will shift from London to Frankfurt in the 21st century, since London will cease to be the financial centre of the world.
In Europe, work is a punishment for original sin. You have to work to live. In Asia, people take time to get to know each other before they decide to do business. In Europe you need contracts to work together. In Asia you build trust first. In Europe the contract is the end of negotiations, in Asia it is the beginning of a relationship.
Europe is moving further away from the USA, politically and economically. Even Britain cannot delay the process too long with their traditional role of playing both sides. We see three independent, strong economic blocs taking shape: Europe, the USA, and Asia (with China taking over the leading role from Japan). Japan will have to apologize for the atrocities they committed in the first half of the twentieth century (especially the Nanjing massacre151), as Germany did to the Allies. The Chinese will insist on this, they will not forget. They also want the Senkaku Islands back.
Germany was the biggest winner in Europe at the end of the Cold War. Reunified, the country is now searching for its new role and position as leader of Europe. This can only happen if the French are convinced of the mutual benefits of a “Franco-German locomotive”.
For Germany this is not the Drang nach Osten but the Holy Roman–Germanic Empire. Germany thus regains its dominant position in Central Europe. After half a century of American dominance, Germany is ready to abandon the Atlantic to return to its Europeanist position (Murphy and Johnson 2004: 1). It has already deferred to the Americans too long, accepting an extensive series of humiliations. The Paris–Berlin–Moscow–Peking axis will become a vibrant reality as soon as the Russians accept their place as factory workers and secondary suppliers to German and Chinese multinationals. Germany will slowly detach itself from the Washington–London axis as Anglo-American power wanes.
During the Cold War, the East Germans were the brightest pupils in the Communist class. They constituted the elite, and they knew it. In just a few years after German reunification, those same people were unemployed. Their homes were repossessed by West Germans. No other people in Europe experienced similar collective humiliation after the Cold War.
At the root of the German character lies fear.152This is the same fear which keeps that people alert, on edge.
You cannot be competitive with a fat belly and a seen-it-all attitude. Germany, not France, is the model for the new Europe. All Europeans should learn German, for several reasons. Germany is not only the leading economic power in Europe: it sees itself as the guardian of reason – a heritage taken over from the ancient Greeks. All successful nations have difficult languages: Chinese, Japanese, Korean. It is important to learn the difficult languages first. Italian is learned in three months once you know Latin and French. Spanish is learned in three weeks.
The Germans are about to revive their interest in Silesia. They have proposed a free zone stretching one hundred kilometres to either side of the Oder–Neisse line, including a quarter of Poland. The German language will be used and taught again in this territory.
In the future Germany will be making more use of Russians as secondary suppliers, as France did with Portugal and Morocco. Since the Russians have an innate respect for Germans there will be no problem of submission.
They will also build an air bridge directly with Chengdu-Chongqing, the new industrial center of the world.
After the soldiers of the Red Army had seen the horrors of Auschwitz, which the Germans had to evacuate in a hurry, no action seemed too barbarous to inflict on the retreating enemy. Much cruelty was also inflicted on German civilians by the British, as retaliation for Hitler’s terror-bombing of Coventry and London. At the end of the war Germany was just a ruin. Its people only survived by taking over a large system of tunnels underneath their cities and thanks to their productive “Geist”. No other people in the past has managed to rise so quickly from defeat.
France has the best geographical location in Europe: temperate, with excellent access to three seas and plenty of navigable rivers. In Northern Europe it is rather too cold, in the south rather too warm, in the British Isles there is too much rain, and Germany, although well placed in the middle of Europe, has limited access to the sea and has few natural boundaries.
In 1914 France possessed much of the north-western part of Africa, except for Nigeria and a few smaller areas.
Nowadays France and Africa exhibit all the symptoms of a troubled marriage.
No Western country has a more centralized government than France, a tradition that goes back to the origins of its monarchy. Even the Institute of Agriculture and the agricultural laboratories of INRA (the French National Institute for Agricultural Research) are located in the Greater Paris region.
One of the greatest strategic mistakes made by the French after the Cold War was that they continued to look south for opportunities, more out of old habit than because it made any economic sense. In consequence the Germans have taken control of most of the new markets in the East.
French has dropped out as a required diplomatic language, and fewer and fewer people speak it. This makes it more important for the French to learn other languages. By 2020, eighty per cent of French-speakers outside France will be inhabitants of Africa and the Arab world. French resistance to learning English has led to the country disqualifying itself as a major player in the sciences.
France , at one time the richest and most powerful country in Europe, the symbol of human rights, of justice, of wisdom, and of progress, a model for the rest of the world, with the best public administration, has been reduced to a shadow of its former self. At the present time it is not far away from bankruptcy, with a debt ten times higher than the annual tax income (same as Spain) (Lewis, Michael (2011): boomerang. New York: W.W. Norton & Co., page 14). Its main asset today is the management of its cultural heritage.
Mass tourism is a growing industry. The most popular destinations in the world in terms of numbers of visitors are France (75 million visitors annually), USA (51m), Spain (48m), and Italy (41m). China is fifth, at 31m. With the reign of Louis XVI, France was on the point of conquering Canada, India, and the sugar route, but went to war and lost (The Seven Years’ War, between 1756 and 1763). England brought France to its knees.
The eventual French colonies comprised the lands that England did not want. They were left with only two jewels, which they could have developed: Morocco and Vietnam. The rest was worthless. France had reached the limits of royal power. From here on it was the beginning of its decline.
France no longer has a vision for the world. French diplomacy is full of conflicting currents, its relations with the Third World are disastrous, its ruling class is out of touch with the world around it, cosseted in an atmosphere of privilege. French politicians repeatedly demonstrate that the country is incapable of developing harmoniously as a society.
The French military establishment is incapable of meeting future challenges on foreign soil, its public-sector organizations are dominated by poor management, and its attempts to integrate recent immigrants have failed. Toulon, where Napoleon once made his initial career breakthrough, is coming more and more to resemble an African ghetto; likewise the old parts of Grasse, once centre of the perfume industry. Marseilles has been too chaotic to govern efficiently for generations. Toulouse is losing its position as an important scientific centre. Like Italy, France is becoming characterized by a marked North versus South division.
In 1919, with Clemenceau, France wanted to create a cordon sanitaire round Germany: destroying the Hungarian monarchy and dividing that country up, handing Transylvania over to Romania, another part of Hungary to Serbia, and making Croatia independent. France wanted to pave the way for Yugoslavia – an absurdity of a nation, an anti-nation, a structure which could not survive.
It was France which forced through the creation of this misbegotten State, Yugoslavia. Later, France should have had the courage to undo its work, but instead the French supported Greater Serbia during the war in the Balkans, in a vague hope of restoring the giant. It was all very embarrassing, especially as many French intellectuals and Francophiles continued to support the Yugoslav concept.
France is in part to blame for the German aggression that built up after the First World War. When France, with American help, defeated Germany in 1919, it did not adopt the role of the noble victor reaching out a hand to the defeated. Instead the Allies imposed economic sanctions on Germany which resulted in poverty, misery, and the rise of Nazism.
The US Federal Reserve chairman anticipated this danger and protested, but to little avail. The French attitude at Versailles in 1919 was itself a reaction to the humiliating treaty imposed on France by Bismarck, in that same Hall of Mirrors, in 1871. These have all been major strategic errors, the result of irresponsible political actions.
France is wasting too much energy on internal discussions. This is leading to inaction, keeping its people from finding and striving towards a common goal. France is putting its efforts into maintaining a set of vested interests. They are living off their capital. The French have an image of themselves as the defenders of rationalism. This used to be true. The country has excellent elites, but they are not able to engage the rest of the population.
France was a fake winner in the Second World War. She received a victor’s honours only thanks to General de Gaulle’s insistence. Charles de Gaulle talks, in his 1932 book, about the importance of character in warfare (de Gaulle1944: 39–62).
His countrymen did not demonstrate much of that when the Germans attacked. The much-hyped French Resistance is largely a myth created after the fact, as in so many other occupied territories.
The French elites have had the bad luck to be on the wrong side more than once in history: with Hitler, and later flirting with Communist regimes. Pol Pot was not condemned until too late. Now, together with Belgium, France is indirectly to blame for the massacre in Rwanda. They not only knew what was happening but even helped to train the killers. It was all geopolitics ; the French were afraid of losing influence in Africa, of having to concede to the Americans once again. It was a lose-lose solution.
Good books on Africa in French are hard to find; they are either excessively aggressive or excessively obsequious. French contributions to philosophy in the twentieth century were mostly misinterpretations of German philosophy (of Heidegger, for instance), or romantic attempts to save Communism (Sartre), all confusedly mingled with intellectual egoism and an insatiable sensual drift. 153 The country produces few thinkers anymore, but maintains a strong intellectual tradition. France’s decline began with Louis XV and continued with the defeat of Napoleon. If it is still able to maintain a position as a secondary European power alongside Germany, this is due more to failures by its European rivals than to its own merits.
The British strategy has always been to divide Europe. So far Europe has not been able to respond to that strategy effectively. After the Second World War, when it had to give up the last of its colonies, Britain came to live more and more from financial speculation and its banking sector. It became the financial capital of the world, a position it was gradually to lose to the USA and New York City early in the twentieth century (the same position that they are losing to Asia today).
The decay continued when Britain lost most of its high-tech industries in the 1970s and 1980s, fooled by notions of “the service economy”, whereupon production began to be seen as something old fashion and dirty even. Now even Rover and Jaguar are Indian, a hard pill to swallow even for only moderately patriotic Britons. When Churchill, Stalin, and Roosevelt met at Yalta in 1945, the latter two had a private conversation about sharing out the colonies and regions of interest that would emerge from the War, since the British Empire was falling apart. …
When Stalin suggested to Churchill that they kill off 50,000 of the German elite after the War, Churchill walked out of the room. Stalin tried to call Churchill back, saying it was just a joke, but Churchill knew better. (Stalin and Hitler had done this with the Polish elite only a few years earlier.) A country cannot live by producing the finest actors in the world. Nor are there enough consumers who favour high-quality clothing (bespoke shoes, suits, hats, umbrellas, etc.).
Britain fell into the trap of becoming a service economy. Now, more indebted than Greece, it faces the threat of economic ruin if public spending cannot be cut quickly enough. The big question for the competitive advantage of Britain now is, as it is for the Netherlands, whether or not its highly multicultural society will be an asset or an economic liability. That question is yet to be answered.
The business model of Irland was to underbid the corporate tax levels of its neigbours. In the meanwhile the country got more indebted than all of its neigbours too, so that the national debt now accounts for 25 times the annual tax revenue (Lewis, Michael (2011): boomerang. New York: W.W. Norton & Co., P. 14). Their next business model is to be a Chinese Trojan horse.
Italy is not one country but two, southern Italy and northern Italy. Calabria and Sicily are beyond the control of the State, run largely by organized crime. Naples and much of southern Italy have their own language which you will not be able to understand on a basis of having learned Italian. (Neapolitan is a mixture of Oscan, Dalmatian, and Greek). It is a different world from Bologna, and a very different one from Turin. The present-day Italian economy is kept going by the descendants of a German tribe which settled in the Po valley at a relatively late point in history: the Lombards, named after their long beards.
Their descendants have created a productive society. Southern Italy on the other hand is a social, political, and economic abyss. According to Alberto Saviano, more people have been killed by organized crime in Naples than were killed in the war in Iraq.
In Italy, “you get the government you deserve” is a true saying. Italian governments since the Second World War have lasted on average for less than a year. Political life is a complete farce, but people do not worry too much about that, because they often see and accept life itself as a farce. The Italian people have found a way to live with chaos. Much of the political establishment is Fascist –not so much for political or ideological reasons, one suspects, as on aesthetic grounds, as in an enormous opera buffa.
In Italy, emotions outweigh reason. It is more important to be simpatico and charismatic than honest or fair. Thus they have had no trouble electing dictators and cabaret artists as political leaders. Berlusconi and Putin understood each other well because they are moulded from the same clay. Berlusconi understood better than any other modern politician that if you control the media you will win elections. If you own the media, even better. The population will forgive you, even if close to a hundred lawsuits have been brought against you and you are going to any lengths to try to claim legal immunity. What matters is to look good on television, to fare una bella figura.
Italy is a “casino”, a chaos – “ma que bello casino!” The country does not function as a unity, either economically or politically, but manages quite miraculously to perform well nevertheless, being held together at the grass roots by family relationships – ultimately by the Italian mother.
Italy’s chief episodes of colonization included Libya, Eritrea, and Somalia in 1920. Ethiopia was added in 1935–36, and Albania in 1939. These were, like so many other foreign-affairs initiatives in Italian history, mere romantic escapades. No-one did more to fight the Mafia than Mussolini. He had almost destroyed the organization when the Americans arrived. The Americans did a deal with the Mafia to secure the support of the local inhabitants. As a result, their advance to Palermo was unproblematic, and very few Americans were killed on Sicily. But the Americans paid the price for this alliance after the War, when the Mafia came calling: “remember us?” The same families are still there today.
After the war, the USA used the Mafia in order systematically to infiltrate and undermine their own labour unions. The port of Naples is today dominated by Chinese interests. From here and from their own port of Piraeus they distribute their products all over Europe. According to Roberto Saviano, fewer than ten per cent of containers are checked. This is probably the best example of Chinese geoeconomic strategy in Europe.
After Berlusconi there will be someone to collect the dirty dishes. Technocrats will have to replace charismatic politicians.
The Mediterranean basin
It was a mistake to allow Greece into the EU so early. Greece does not belong to Western Europe, but to Orthodox Europe. We admitted the country mainly for sentimental reasons, remembering Ancient Greece and the classics.
After five centuries of Turkish rule, there remain today only memories of the culture we associate with that glorious period. The Balkans as a whole have been “Turkified”; the food, the music, even their children’s stories are much the same. Only the ruins and the remarkable books the Ancient Greeks left behind remind of us of the culture that was once here. Greece has become purely a drag on the EU. It is a country with little sense of duty to a common goal. The country has an inefficient bureaucracy, a huge public sector, a huge budget deficit, and the highest inflation rate of any European country.
The king of Morocco believes himself to be a descendant of the prophet Mohammed. If you write anything resembling a critical remark about him you can find yourself spending years in prison. The king himself likes travelling in more liberal countries and enjoying all of life’s conveniences.
This is a hierarchical society, where the children of the privileged are sent to the best schools in France. The rest have systematically been kept from getting an education. Thus illiteracy is a problem. The Moroccan government does little to promote literacy, and it hinders people from migrating into the cities, where there is not enough work for them. Morocco has a solid intellectual elite, and if Turkey is to be an EU member state there are fewer reasons why Morocco should not also become one. Moroccan students are among the best in French universities, in subjects like mathematics and computer science. Morocco is the only African country where the French feel that their interests are reasonably secure. When the French retire, some of them buy houses in Marrakesh or on the coast.
This is a country where people seldom speak their minds. Instead conversations are always on two levels. Europe would never accept Algeria getting an Islamist government. If Algeria went nuclear, it could become the European Cuba. That is why we have supported Algerian dictators and military regimes. And Algeria is not unique in that respect. Algeria is run by two rival forces: the generals on one side (known as le pouvoir) and the challengers on the other, President Abdelaziz Bouteflika and his friends. In recent years Bouteflika has been on the offensive. He amended the constitution, on 12 November 2008, to allow himself to be president for life. After the Arab Spring Bouteflika has had to retreat in several areas, but still sits firm in power.
Ten years of savage fighting and killing between the government and the FIS (the old mujahedeen who had fought the French) ended in an armistice at the beginning of the 21stcentury. There were no winners, only losers. The bombings in the Paris tunnels in 2005 were a reminder of what forces might be released.
Muammar Gaddafi was the world’s longest-ruling dictator. As Libya has the largest oil reserves in Africa, Gaddafi was able to avoid most criticism. The USA provoked the war against Libya in 1986 by sailing close to their coast. When the Libyan Navy reacted to this, the US retaliated massively. The war was initiated partly to divert the eyes of the American public from the war against the democratically-elected government of Nicaragua. In retaliation, Gaddafi ordered a bomb to be placed on a Boeing 747 filled with American civilians (Lockerbie bombing).
No wonder the US government was angry when Gordon Brown exchanged the main suspect for BP oil contracts in Libya. Now revolution has come from within, supported by French and British interests. But, the new Libya is not looking to the West for a role model, but to Turkey, an enlightened country governed by Islamists. Much of the revolution was cleverly orchestrated from Doha, fooling much of the Western Intelligence community
Tunisia is not Arab, but Byzantine. It was part of the Byzantine Empire. Carthage was populated by Phoenician and Greek settlers, and later by Romans. Tunisians view the Vandals as civilized. Their hundred-year rule of Carthage was a time of prosperity. It was the Roman Church which gave the Vandals a bad name, especially after the “sack of Rome” in 455, an episode that for its time was actually remarkably sparing of human life, leaving very few Romans dead. Under Bourguiba, and later under Ben Ali, the people got an education and became better off. Now, they want to rule.
The Nordic countries
Denmark’s is a culture of merchants and diplomats. As such they are highly pragmatic and flexible. It is difficult for outsiders to see where Danish wealth comes from. After all, they have no oil or major industrial production. Instead the country is home to many service companies (ISS, Maersk) and they export large quantities of meat and food products, especially pork, to other EU countries.
Together with Britain, Denmark is the chief country standing in the way of EU unity in the Iraq question, and siding with the USA. The British motives are easier to understand: they have real economic interests at stake. The advantage for Rasmussen is clear too, he got the top job at NATO; but for Denmark?
Norway is an oil state, and thus more at home in OPEC than in the EU. Oil is easy money. It exempts you from the need to be competitive. It is a feather bed. Most of the country’s sophisticated technology is imported (Siemens, Alcatel, and ABB have shared much of the market between them). The Norwegian State expropriated Siemens after the Second World War, but sold it back to the Germans later.
The Norwegian leadership never understood the importance of building their own technological capacities, of developing strong industries. Their chemical and oil industries were both developed with the help of Swedish investors. Oil contracts are handed out to local producers without much competition, in return for promises of jobs. The owners of many of these companies show their country little gratitude, and shift their money abroad. Oslo, the Norwegian capital, contains no middle class with a sense of responsibility, such as you will find in most capitals of the Western world. This is because Oslo has no real experience of being a capital: it was created in a hurry by people who came from all over the place. Its original inhabitants were subordinates under Danish rule, who helped to keep their own people down.
The only town which qualifies as a capital is Bergen. It has all the virtues of a German Hansa city. Above all, it has the right mind set to govern, as Prime Minister Michelsen showed in dealing with King Oscar II of Sweden. Norwegians do not think of themselves as living in an oil state.
Part of the reason is that their statistical yearbook does not give an accurate account of the proportion of the economy deriving from oil revenues. In reality, pretty well everyone is supplying the offshore industry. But Norway, like Dubai, has indulged itself in the illusion of having become a Knowledge Economy. (In Dubai the largest building in the world was built as a turnkey project by the South Korean company Samsung Heavy Industries).
The deteriorating relationship between the USA and Iran and Iraq could open up new business opportunities for a neutral country like Norway.156But the Norwegian population insists on high standards of business ethics, at least in public. In reality, the oil business cannot cope with the light of day.
The main difference between Norway and other OPEC member states is the country’s exceptionally fair system of economic redistribution – a product of the social democratic model, invented by the Germans under the Weimar Republic and very much developed by the Swedes.
While the Fadh family of Saudi Arabia visit their palace in Marbella each year with a couple of hundred guests and squandera hundred million dollars in a week, the Norwegian State makes sure that everyone gets something, even if it is for doing nothing. As petroleum is replaced with new sources of energy, natural gas will give Norway another fifty to a hundred years of easy money.
The Norwegian character is formed by close contact with nature. City life still feels a bit odd to a Norwegian. If he dumps into you on the street you will hear no apologies. Instead he may look a bit puzzled. “Mountain people”, George Brandes says a propos Rousseau (a Swiss), look down on politeness as something of minor importance in daily life. “Mountain apes” is what one sometimes overhears Danes calling their former colony and neighbours.
Norwegian unity is founded less on internal similarities than on external threats.157 The spectacular National Day parade on 17 May originated as a protest march against Danish and Swedish rule. In 1905, when Norway became independent, the protest march turned into a celebration. The enthusiasm lasted a long time, but today seems to have become largely an empty ritual, a celebration more of prosperity than historical battles.
Norway comprises at least three different cultures each with their own written language:
- people on the west coast and in the rural areas, who write Nynorsk
- people in and around the capital and in Eastern Norway, who speak Bokmal
- the Laplanders or Sami people in the north, a non-Germanic nomadic tribe which emigrated from northern
Russia and speak a Finno-Ugric language. Norway was under de facto American control during the Cold War. The Barents Sea was to be the main theatre of the Third World War. Since the Soviet Union had only one secure ice-free harbour, at Murmansk, northern Norway would have been one of the first important battlefields. Occupying Norway would have been even more important than it was for the Germans in the Second World War, when they had to beat the British to it. The Swedes find it surprising that their Norwegian neighbours will not buy their planes, which are cheaper than American alternatives. But aeroplanes are only one part of a broader system of defence, in which the real question is “Will you come and help us if we are invaded?”
In Sweden everything goes through in silence; they operate by consensus, not confrontation. Debates do not penetrate below surface issues. These are the Japanese of Europe: modest, hard-working, and united. The Swedes will follow a leader quietly, even if they think he is wrong. Only when all hope is gone will they protest, and chop off his head if necessary. This is a scary pattern, and it is assumed to have been fate of several Swedish kings and heads of State: possibly Charles XII, certainly Gustav III, perhaps Olof Palme too. The Swedes are very different from their Norwegian neighbours, who will speak their minds whenever they can, often at risk of damaging a relationship. In Sweden you hold your tongue; you do nothing to disrupt the social balance.
Sweden’s policy of neutrality is based on geography not history (cf. Tunander 1990: 13). It is on the periphery of Northern Europe, and any power wanting to conquer Sweden would have to tie up numerous troops. Its territory is no use for holding other parts of Europe.
There is a long tradition of consensus among politicians and businessmen in Sweden. The leading capitalists and industrialists are not ones for showing off their wealth. The ruling family, the Wallenbergs, have as their motto essere non videri (to be, not to seem), borrowed from the Medici. They control about half the capitalization of the Stockholm Stock Exchange. Swedish companies quickly established themselves in the ex-Soviet Baltic countries, where wages were a tenth of Sweden’s. They have more than half the banking market in all three countries –as much as seventy-five per cent in Estonia. But the window of opportunity was short-lived and it is a small market. Now, the banks are paying for their carelessness. Luckily for them the European Central Bank and the IMF got involved and took on large shares of the risk.
The Swedes are fond of their Norwegian neighbours, but do not take them seriously. They have an ambivalent stepfather relationship with their ex-colony Finland, the loss of which some two hundred years ago still brings out strong emotions; they despise their Danish neighbours, for their unintelligible speech, disorder, and perceived social excesses … which they secretly long for themselves.
Modesty is a sign of all great cultures. Many Asian countries, but also Sweden possess this quality. Swedish culture is a collectivist culture, united in possessing a military spirit that is easily mobilized to resist outside dangers (Catholicism, the Danes, the Russians). It is encapsulated in the Swedish word for keeping quiet, tyst. It has only to be uttered for everyone to fall into line. This is a country which has proved that it can fight for principles and ideals: the defence of Lutheranism, the defence of their colonies in the East (Finland, the Baltics). It is the only Nordic country to have built a truly robust industrial economy (Finland is over-reliant on a single company).
Swedish culture elevates hard work above criticism. For that reason, there are no real critical newspapers or media in Sweden, nor any great social thinkers. Their greatest author, Strindberg, is in this sense not a typical Swede.
Finland has the best school system in the world! It is basically just the old Swedish school system, but with pedagogical techniques not modernized. To understand Finland’s politics you must understand its stormy relationship with Russia. This is a small country with a former superpower as its sole neighbour. This is a State which gained most of its democratic rights at a single time, and relatively late, in 1917. It is a country which knows how to survive, how to mobilize its resources under pressure. Nokia is the best example in modern times, having begun as a manufacturer of tyres and rubber boots. Finnish vitality has created the strongest meritocratic society in northern Europe.
Foreign and security affairs are handled, not by the government or the political parties, but by the president (see e.g. Tunander 1990: 3). This system gets things done. Cold weather and hardship have shaped Finnish character. The Finns have never learned to make small talk; they either say nothing, or too much.
The country has received too much unfair criticism. If the country went bankrupt in 2008 it was mainly due to its small size (about 300.000 inhabitants). Other countries would have been able to buy out three major banks. If the country is to be blamed for something it was that they left a handful of bankers sell out to modern financial theories and leave their common sense and notion of business ethics.
The Baltic States
The Balts adhere to Western culture. The Estonians and Latvians are Lutherans, Lithuanians are Catholic. The Estonian language is Finno-Ugric, a member of the same family as Finnish. Their mentality is Nordic. Intermarriage with Russians is far less common than in Latvia. The Estonians were only in the Russian sphere from August 1939.160
Estonia is the best student in the Baltic class, and quickly re-established its natural ties with Finland. Latvia has the greatest problems. Swedish banks including Swedbank and SEB went into Latvia and made over-generous loans, without a proper understanding of the country’s prospects. Now they are paying the price. Lithuania has many of the same problems as Latvia, but has a much stronger and more stable cultural identity. One of the oldest and most homogeneous cultures in Europe, Lithuania will always find a way to survive. When the Russians regained influence over the Baltic region after the Second World War, the Baltic elites were divided into three groups: some were shot right away, some were sent to the gulags, and the rest were deported to Siberia.
The small size of these countries, both in territory and in population,161 and the lack of any natural borders to the east, makes Russia a constant threat. Russians represent about half of the population of Latvia, and all large towns in Latvia are heavily populated by Russians; in Riga they account for fifty-two per cent of inhabitants.
Ethnic Latvians can only keep power in their own hands through a policy of apartheid called non-citizenship . 34.6% of ethnic Russians are non-citizens, which gives them a passport, but no right to vote. Being largely excluded from political life, and finding their Cyrillic script rejected, the Russian part of the population has been forced to turn to commerce and day labour (Jacob 2004: 188–9). If they do not return to Russia that is because things are even worse there.
To retain their independence, the Baltic States know they need to show strong interest in and keen engagement with the West. They have been granted membership in the EU and in NATO, and restored their historical ties with countries in their region, notably with Sweden.
For now this will be enough. The eastern shores of the Baltic have always been a turbulent area. Control of these coasts has passed back and forth in history, from Swedes, to Danes, to Germans, and to Russians. Now these waters are under NATO control, and need to remain so until the EU can match Russia in military strength.
The area around Novgorod was dominated by Scandinavian traders until the split between Orthodox and Catholic churches in 1054. Swedes sent crusaders to conquer Finland and Karelia. In 1142 they conducted their first campaign. This provoked retaliation in 1187 on the western side of the Baltic. The Danes concentrated their efforts in Estonia. Its inhabitants retaliated by raiding Blekinge (now Sweden, then part of Denmark) in1203. Novgorod was later controlled by the princes in Moscow.
The German Order took Estonia over from the Danes, but did not succeed in holding it. Just as Moscow was starting to get things in hand, it was conquered by the Mongols under Genghis Khan’s son Batu. The Russians suffered a serious defeat in battles by the Mongols, and were only able to return to this area in the late nineteenth century. Kaliningrad is the last piece of the Baltic jigsaw (Worthington and Sedakat 2005: 123). Politically it is part of Russia, but isolated and surrounded by EU territory. The Germans are already planning a motorway between Kaliningrad and Berlin (an old project of Hitler’s), and would gladly buy the territory back. This will be a deal for a rainy day.
During the first decade after the Cold War, plundering the State became a national sport in many former Eastern-bloc countries. Other chronic problems include an unusually high divorce rate, general social despair, a lower standard of living, housing shortages, and so forth. Eastern Europe (Belarus, Estonia, Latvia, Lithuania, Moldova, and the Ukraine) is a region of 73 million inhabitants where people spend too much of their time working out how to trick one another. This is the Russian front lawn (as opposed to the backyard in the south). The Baltic states, particularly Estonia, are slowly working their way back into the civilized world. If left in peace they may even prosper as part of a Baltic Sea region.
That is a long term strategy, for the latter half of the 21st century. By accepting former Eastern European countries into the EU we are strengthening our economic and political potential vis-a-vis our American and Asian competitors. We will eventually clean up the mess. It is a process that will last half a century. No one can halt the immigration from Eastern Europe. The consequences of this migration will be a mix of positive and negative, in a sense two extremes: many really bright people, and many criminals. Those are the fighters and the survivors in any culture.
EU enlargement means that a gypsy population of five to six million (in Romania, the former Yugoslavia, Hungary, and the former Czechoslovakia) has becomes our shared responsibility. Apart from their rich tradition of music and dance, gypsy history has been a history of slavery, beggary, and violence. This is not a people you can integrate easily: it will take a long process of socialization.
Poland is a territory without any natural boundaries. It is a people of warriors who have lost all their wars. It is not an industrialized nation, but a nation of farmers and in many ways a de facto matriarchy. The Poles have no friendly neighbours. That led Poland straight into the arms of the USA after the Cold War. The Polish elites used to be educated in France. In consequence hundreds of Polish workers arrived in France after the Cold War was over every day to seek their fortune. No-one could separate them from the French. None have been thrown out yet. France failed to protect Poland in the Second World War, so now they are paying the price. Poland does not fit into the traditional Slavonic mould either. They are Catholic and “Latinized” (as the Finns are Lutheran and “Swedenized”)
As with Turkey (Muslim), a strong Poland (Catholic) is the best guarantee against Russia becoming a superpower again. Therefore both these countries enjoy a special relation with the USA. Poland’s borders have been repeatedly redrawn throughout history. The heartland of Poland is Warsaw. Only the area round Warsaw has always been Polish. To compensate for the loss of Eastern Poland to the Soviet Union, when one and a half million Poles were forced to move westwards, the Allies twice (at conferences at Yalta in February 1945 and at Potsdam in July–August 1945) gave Poland extra territory to the west, including Silesia and parts of Pomerania and East Prussia.
The German position on these annexations today is divided. Some accept the new borders (especially in view of the suffering Nazi Germany inflicted on the Polish people: six million Poles were deported and exterminated, including three million Jews). Others see the annexations as unjust, and would like to see increased German influence in those regions. And then there are a great many who do not dare to say what they think.
Hungary is eager to regain its former territorial integrity. The Hungarians are an elitist people, who were long a trustworthy outpost against Mongolian hordes in Central Europe. There have been about as many Nobel laureates from Hungary as from France; yet Hungary has only ten million inhabitants compared to France’s sixty million. Hungary must suffer, said Clemenceau. The country was seen as a threat to French control of the German region, because it is a Catholic country and because the elites of the Imperial Austrian Army were commanded by Hungarians.
The Hungarians have defended Europe from barbaric invasions for more than a thousand years. Their country has been the continent’s Checkpoint Charlie, located on the only natural route to Central Europe. This situation has moulded an exceptional warrior class. By contrast, Austrian soldiers were mostly used for parades. As the Russians said at Stalingrad: it is better to face the SS than the Hungarians. The Hungarians were also the only nation who dared to revolt openly against Russian control, in 1956.
France yoked the Czechs and Slovaks together, two peoples who had led separate existences for more than a thousand years: the Slovaks dominated by Hungary, the Czechs by Austria. Now they have separated again. This promises to raise Czech living standards to German levels.
Romania and Albania were the most thoroughly wrecked countries in the former Eastern Bloc. Now that Romania has joined the EU, we have several hundred thousand beggars scattered all over Europe. These countries were a hard pill to swallow, but we had no choice but to include them, to keep the Russians out and to try to create some stability in the alkans (the weed patch of Europe). Being both a stronghold and a crossroads, Romania has been marked over the centuries by isolation and by great invasions.
The country has been a victim of Turkish hegemony, of pan-Germanism, and of pan-Slavism. The Carpathians form a semicircular fortress, a relatively low but nevertheless effective natural barrier. Romania is a Latin island in a Slavonic ocean. Because of its Latin character it has looked towards France. But the French influence is relatively new: it dates only from the time of Napoleon III. That relationship reached its peak between the two world wars.
Earlier, the country was a vassal province under the Turks. Ninety per cent of the population are ethnic Romanians; forty-five per cent live in rural areas, mostly as farmers. This makes it the least urbanized country in Europe, except for Albania. The Romans founded their province of Dacia in this territory between 106 and 270 BC. Slavonic immigration began much later, in the seventh century. Except for the language there are few Roman features remaining in
Romanian culture. The Hungarian influence in Romania is confined to three counties in Transylvania. The Germans in Romania, mostly Saxons and Bavarians, are another energetic minority. In 1930 they constituted four per cent of the population; today they are half of one per cent, or about 120,000 individuals. It would have better for the prosperity of the country if they had been allowed to take charge. The Romanian diaspora is considerable, comprising twelve million people, of which 2.7 million live in Moldavia, 1.7 million in the former Yugoslavia, one million in the USA, and 500,000 in the Ukraine.
A German proverb says “Romania is not a nation, it is a profession”. Few people in Romania respect anything. Exceptions are most numerous among the groups of German extraction and the three million Hungarian Romanians. This is the world of the Balkans, it is not the West. The French say “We should not be seduced by the similarity of our languages. We already have enough problems with Greece.” Many forces collaborated in order to eliminate Ceauşescu and replace him with a more representative Communist.
Silviu Brucan, who had been a diplomat, was given the green light by key members of both the police ministry and the Communist Party to eliminate the feared dictator. The decision was OK’d by both Washington and Moscow. Brucan made a deal with Gorbachev, that the Communist Party should continue to hold sway in Romania after Ceauşescu was gone (Barrat et al. 2003: 213). It was an assassination in the Romanian manner. Today, though, much the same people are still in power. They have just learned to speak differently.
Russia is allowed to retain its influence in Moldavia in return for keeping out of Serbian politics. Hardly ever in the news, Moldavia has been in a permanent state of crisis since its independence in 1991. With no more than 4.5 million inhabitants, Moldavia is split between three ethnic groups – Russians, Moldavians, and Gagauzians – each of which wants separate independence. Historically it has been difficult to draw a clear dividing line between Moldavians and Romanians. Moldavia is a buffer state with few distinctive features.
What do you do as a Russian when the very cradle of your nation celebrates its independence from you? This was what happened in 1991. What do you do as an Ukrainian when the Orange Revolution has run out of steam and when half the population is pro-Russian? This is not a situation to be solved overnight … and in the meantime the economy has collapsed. Kiev is the mother of all Russian cities.
The Vikings came here in 859, first as robbers and thieves, then invited as protectors for the expanding Russian nation. Pressure from the Mongol hordes in the East steadily increased, and in Kiev was conquered; it remained a territory plagued by sporadic violence for centuries. This tumultuous history has shaped both the Russian and the Ukrainian character, tossed back and forth between Eastern brutalism and Western political ideals.
Twenty-two per cent of the 48 million Ukrainian population is of Russian origin. These all live in the eastern parts of the Ukraine, including the Crimea. Without their support, real Ukrainian stability is impossible. The Ukraine is really a Russian affair, but we cannot pass by a chance to block Russian influence. That said, NATO is not going to defend the Ukraine if Russia invades.
The Balkans are the last underdeveloped area remaining in Europe. The word “Balkan” is Turkish for “mountain”, and initially referred to what is now Bulgaria. Today it is used to cover the area between the Adriatic to the west, the Aegean to the south, and the Black Sea to the east, and often including Romania.
The word “Yugoslav” was given by the Austrians to the people who migrated to the Balkans; it means “South Slavs”. The fate of the South Slavs has swung between being part of the Ottoman Empire, then part of the Austro- Hungarian Empire, to a sort of independence, though never undisputed. Yugoslav unity has been difficult to establish, because of impenetrable mountains and valleys.
There is an old saying: “A monster lies sleeping in these valleys. Once in a while it comes to life and kills tens of thousands of people. Like the Caucasus, this is a turbulent border area between Christians (Lutheran and Orthodox) and Turks. The Balkans today consists of a number of buffer states which are in the process of reconstructing their pre- Cold War identities. Like other crossroads of civilization, the Balkans comprises a wide diversity of ethnic groups. It contains:
- Muslims remaining from the Ottoman Empire (roughtly corresponding to Bosnia-Herzegovina) a substantial Slavonic population (Republic of Serbia, Croatia, and part of Kosovo) early settlers from Albania (Albania plus part of Kosovo)
- German-influenced groups in the north (Slovenia and part of Croatia)
- Greek- and Bulgarian-influenced groups in the south (Republic of Macedonia).
Mapmaking in this area can only be described as a nightmare, and can never be fair to all sides; there are too many conflicting interests. Only tolerance can secure their future. Five hundred years of Ottoman rule wiped out much from the indigenous cultures in this part of the world. Turkish influence is shown by similarities in the food, the clothes, even in local songs… though few who live here will admit it.
Russian influence in the area is from a later date, the end of the seventeenth century. Russia was then confronting the Ottoman Empire, which had conquered the Ukraine aided by the Dnieper Cossacks. Peter the Great lost a number of battles in the Balkans, notably at the Prut River in July 1711, when he was almost captured; Russia was fully stretched at the time trying to hold on to the city of Azov, in order to get access to the Black Sea.
Only with the treaty of Kuchuk Kainarji (July 1774) did Russia get a foothold in the Balkans. Their position was never really strong. Serbia’s repeated cries for help have been ignored by Russia ever since. The Russians have accepted the region as part of the Austrian sphere of influence (cf. Mudry 2005: 21–3). Russia’s main interest is in Moldavia, previously a vassal to the Sublime Porte.
Yugoslavia was allied with the Soviet Union only between 1941 and 1948, after which there was a rupture between Tito and Stalin. Stalin tried to kill Tito many times, but never succeeded.
Serbia will be the most difficult country to integrate into the EU, but this must nevertheless be done in order to achieve order in the Balkans. It will be the work of half a century.
Home to half the population of the former Yugoslavia, this homogeneous group of people refuses to abandon the old dream of the mediaeval Serbian kingdom. The Europeans cannot invite them into the EU before they sort this out for themselves and decide to become more civilized. We face a long stalemate. In the meantime, Serbia’s neighbours will continue to grow in prosperity, and new generations of Serbs will put pressure on their elders to change their thinking.
The Serbs have revolted on several occasions. The Treaty of Adrianople (September 1829)set up a legal framework for the Serbian State. Since then the Serbs have been on their own, a Slavonic satellite out in deep space (Serbia was formally an ally of Russia only briefly, from 1903 to 1917.)
Serbia must abandon all its aspirations in Kosovo and surrender its war criminals to the International Criminal Tribunal for the former Yugoslavia. Until it does this, it will remain isolated. The EU is in no hurry.
The Croats was one of the three Slavonic tribes, together with the Serbs and the Slovenians, who migrated into the Balkans relatively late in history, at about the same time as the Anglo-Saxons laid the foundations of England. The Croats and Serbs immigrated as one group, and resemble each other physically. Until that time the Balkans had been part of the general culture of antiquity .
Croatia has long been part of the Austrian–German zone of influence, and is predominantly Catholic. It belonged to the Habsburgs for almost four centuries, from the time it elected Ferdinand I as its king in 1526. Nazi Germany restored the Croat State in 1941, and it was largely thanks to Germany that Croatia was included in the European economic community so soon, in 1991.
Much blood has been spilt on Croatian soil. The Croatian Fascists, the Ustashi, were trained in Italy and Hungary. They slaughtered not only Jews and gypsies but hundreds of thousands of Bosnian Serbs. Upwards of a million people were killed here by German Nazis, Italian Fascists, Croatian Ustashi, and Serb Chetniks. As with Serbia, Croatia will need to co-operate fully with the International Criminal Tribunal to investigate the atrocities committed by its forces during the Croatian War of Independence (1991–95) before it can hope to become an EU member.
The Slovenes are related to the Czechs who live further north, but speak a language closer to Serb and Croat. Like the Czechs these are a responsible Slavonic people, ferociously independent, known for their appreciation of culture, especially fine literature (poetry). These characteristics are inseparable from their identity and national pride.
The Bosnians became Muslims voluntarily, and for good reasons: the Roman Catholic Church was much more tyrannical than the Sultan in Istanbul. They were a peaceable people who used to know how to live a good life. Consequently they have fewer problems as refugees in integrating with the more civilized nations of the Western world.
There are three Bosnias and three Herzegovinas: one Roman Catholic, one Serbian Orthodox, and one Moslem. To keep these six elements together requires a miracle. In the north there are also a number of Protestant villages, and, until the Ustashi massacred them, there were even some Sephardic Jewish communities here. Sarajevo is an old aristocratic town.
It was never typical of the rest of Bosnia–Herzegovina, but a special “pleasure city”. The beys who ruled here under the Ottoman Empire were remarkable hedonists, a trait still noticeable in the character of the present-day population (Brown 1954: 83).
Often called the “Free Principality of the Black Mountain”, this country has a population with a character of granite. Even though it was never independent before 2006, it had never really lost its sense of unity. Russia long dreamed of making this country its ice-free port with access to the Mediterranean and the Atlantic, and the Turkish Sultan repeatedly tried to crush the people who lived here; but it is not a place you invade, and not a people you can keep as servants. It takes a lot to shape granite.
Since the end of the Cold War, Albania has been a factory for organized crime. Albania is the entrepot for a large share of the drugs entering Western Europe. Albanian mafia groups have succeeded in operating freely in all major European cities. Their criminals cannot be handled like other criminals. As with Russian mafia groups, they must be met head on if we hope to manage the threat they represent.
If the Serbs want to invade this country they will have to fight the Albanian half of the population. That is not a fight they can win. Few people are as easy with violence as the Albanians.
Today’s Republic of Macedonia is a windy plateau, infertile, and less than half the size of the historical Macedonia of Alexander the Great. It is nothing to get romantic about.