This is an interesting read - not just the Headlines please!
The Germans are making contingency plans for the collapse of Europe. Let’s hope we are, too
The German defence ministry set out its worst-case scenario for the year 2040 in
a secret document that was leaked to Der Spiegel last week: “EU enlargement has been largely abandoned, and more states have left the community … the increasingly disorderly, sometimes chaotic and conflict-prone, world has dramatically changed the security environment.”
The 120-page-long paper, entitled Strategic Perspective 2040, is a federal government policy document – and the scenarios it imagines are grimly realistic: an east-west conflict in which some EU states join the Russian side or a “multipolar” Europe, where some states adopt the Russian economic and political model in defiance of the Lisbon treaty.
That the document exists at all is a sign of the increased tension in the global system. The German military’s tradition of rigorous logistical planning for every eventuality began with the celebrated German field marshal Moltke in the 1850s and has three times paid off with initial success: in 1871 against France, in 1914 and 1939 against the rest of Europe. In the post-cold war era, as Der Spiegel puts it, allowing German generals to make statements about the future was “too risky”. That changed with Russia’s annexation of Crimea in 2014.
Despite the alarmist headlines it has generated, the leaked document is, if anything, overoptimistic. In three out of the six scenarios, things go so well that Europe resembles the Biedermeier era – 1815-1848 – of domestic bliss and military boredom. Its negative scenarios – which see the US struggling to avoid isolationism and China locked in a cultural war with the west – were written before Donald Trump came to power and before
Xi Jinping’s strategy of creating a politicised Chinese infrastructure across Asia.
Brexit Should Be Prevented, German Government Advisers Say
The U.K.’s exit from the European Union should be prevented due to the “far-reaching impact” Brexit would have, Germany’s Council of Economic Experts, which advises Chancellor Angela Merkel, said Wednesday.
If Britain does leave the bloc, an agreement is needed that would minimize the damage for both sides, the council said in its annual report. With talks likely to drag on longer than the two years envisaged by EU rules, a one-time extension period should be granted, the experts said.
“Due to the wide-ranging impact of a U.K. exit from the EU, the council continues to urge that it be prevented,” the council said. “The economic cost of Brexit will hit the U.K. significantly harder than the rest of the EU.”
EU President Donald Tusk last month revived the notion Britain could remain a member of the bloc, saying the outcome was entirely in the hands of the British government. Germany and France have indicated the U.K. would be welcomed back if it decided to reverse the Brexit process. In order to do so, Britain would likely have to hold another referendum or elect a government led by a party that campaigned on a promise to stay in the EU.
The European Union will begin talks Wednesday on what the 27 countries want from a Brexit transition deal, seeking a united stance they can present to the U.K. once talks break out of the current deadlock. Both sides are hoping that talks on trade and the transition can move ahead after an EU summit in mid-December.
“There is still a risk of an uncontrolled exit and sudden adjustment reactions by economic agents,” the German government advisers said. “Conversely, the possibility of the U.K. staying in the EU can’t be completely excluded.” The council’s comments on Brexit made up about two pages of the more than 400-page report, which includes a detailed assessment of global economic conditions.
The advisers also urged the European Central Bank to end its bond-buying program earlier than planned and consider raising interest rates. They said that risks to financial market stability have increased even in the absence of deflationary threats in the 19-nation euro area.
“On the one hand there’s a risk of excessive asset prices, especially in the residential real estate and bond sectors, and on the other hand, the interest-rate change risk at banks has increased significantly,” the council said. “The ECB should therefore urgently communicate a comprehensive strategy for the normalization of its monetary policy.”
