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[Lilia M. Schwarcz and Heloisa M. Starling, Brazil: a biography (discussion: Madrid, 2016), 896 pp.]

review / Emili J. Blasco

Brazil: a biography Presenting the history of a vast country such as Brazil in a single volume, albeit an extensive one, is no easy task, if one wants to go into sufficient depth. "Brazil. A Biography" (for this review we have used Penguin's English edition, from 2019, somewhat later than the publication of the work in Spain; the original in Portuguese is from 2015) is an account with the appropriate lens. "Brazil is not for beginners", say the two authors in the introduction, expressing with that quotation of a Brazilian musician the way they conceived the book: knowing that they were addressing an audience with generally little knowledge about the country, they had to be able to convey the complexity of national life (of what constitutes a continent in itself) but without making the reading agonising.

The book follows a chronological order; however, the fact of starting with some general considerations and building the first chapters around certain social and political systems generated successively by the sugar cane plantations, the enslavement of the African population and the search for gold means that Brazilian life advances before our eyes without having the sensation of a mere shifting of dates. Later comes the 19th century, which for Hispanics is of interest to see the negative side of the history we know about the Spanish American colonies (in contrast to the Spanish case, during the Napoleonic wars the entire Portuguese Court moved to Rio de Janeiro and independence did not result in various republics, but in a centralised monarchy of its own). And then a 20th century that in Brazil was a good compendium of the political vicissitudes of the contemporary world: from the Estado Novo of Getúlio Vargas, to the military dictatorship and the restoration of democracy.

The work by Schwarcz and Starling, professors at the University of São Paulo and the Federal University of Minas Gerais, respectively, focuses on political processes, but always with the parallel social and cultural processes that occur together in any country. The volume provides a wealth of information and bibliographical references for all of Brazil's historical periods, without disregarding some in favour of others, and the reader can focus on those moments that are of greatest interest to him or her.

Personally, I have been more interested in reading about four periods, relatively distant from each other. On the one hand, the attempts by France and Holland in the 16th and 17th centuries to set foot in Brazil (they were not permanently successful, and both powers had to settle for the Guianas). Then the emergence and consolidation in the 18th century of Minas Gerais as the third vertex of the Brazilian heartland triangle (Rio de Janeiro, São Paulo and Belo Horizonte). Then the description of the life of a European-style court in the circumstances of the tropical climate (the monarchy lasted until 1889). And finally the experiences of mid-20th century developmentalism, with Juscelino Kubitschek and João Goulart in a tour de force between democratic compromise, presidential personalism and the undercurrents of the Cold War.

Reading this book provides numerous keys to a better understanding of certain aspects of Brazil's behaviour as a country. On the one hand, how the immensity of the territory and the existence of areas that are difficult for the state to reach - the Amazon is a clear example - gives the army an important role as guarantor of the continuity of the nation (the success, perhaps momentary, of Bolsonaro and his appeal to the Armed Forces has to do with this, although this last presidency is no longer included in the book). On the other, how the division of territorial power between mayors and governors generates a multitude of political parties and forces each presidential candidate to articulate multiple alliances and coalitions, sometimes incurring in a "buying and selling" of favours that generally ends up having a cost for the country's institutionality.

The book's essay was completed before the collapse of the Workers' Party government era. That is why the consideration of the governments of Lula da Silva and Dilma Rousseff is, perhaps, somewhat complacent, as a sort of "end of history": since the end of the military dictatorship in 1985, the country would have evolved in the improvement of its democratic and social life until the time crowned by the PT. The "Lava Jato case" has shown that "history continues".

Categories Global Affairs: World order, diplomacy and governance Book reviews Latin America

COMMENT / Sebastián Bruzzone

"We have failed... We should have acted earlier in the face of the pandemic". These are not the words of a political scientist, scientist or journalist, but of Chancellor Angela Merkel herself addressing the 27 other leaders of the European Union on 29 October 2020.

Anyone who has followed the news from March to today can easily realise that no government in the world has been able to control the spread of the coronavirus, except in one country: New Zealand. Its prime minister, the young Jacinda Ardern, closed the borders on 20 March and imposed a 14-day quarantine on New Zealanders returning from overseas. Her "go hard, go early" strategy has yielded positive results compared to the rest of the world: fewer than 2,000 infected and 25 deaths since the start of the health crisis. And the question is: how have they done it? The answer is relatively simple: their unilateral behaviour.

The most sceptical to this idea may think that "New Zealand is an island and has been easier to control". However, it is necessary to know that Japan is also an island and has more than 102,000 confirmed cases, that Australia has had more than 27,000 infected, or that the United Kingdom, which is even smaller than New Zealand, has more than one million infected. The percentage of cases out of the total population of New Zealand is tiny, only 0.04% of its population has been infected.

As the world's states waited for the World Health Organisation (WHO) to establish guidelines for a common response to the global crisis, New Zealand walked away from the body, ignoring its wildly contradictory recommendations, which US President Donald J. Trump called "deadly mistakes" while suspending America's contribution to the organisation. Japanese Deputy Prime Minister Taro Aro went so far as to say that the WHO should be renamed the "Chinese Health Organisation".

The New Zealand case is an example of the weakening of today's multilateralism. Long gone is the concept of multilateral cooperation that gave birth to the United Nations (UN) after the Second World War, whose purpose was to maintain peace and security in the world. The foundations of global governance were designed by and for the West. The powers of the 20th century are no longer the powers of the 21st century: emerging countries such as China, India or Brazil are demanding more power in the UN Security committee and the International Monetary Fund (IMF). The lack of common values and objectives between developed and emerging countries is undermining the legitimacy and relevance of last century's multilateral organisations. In fact, China already proposed in 2014 the creation of the Asian Investment Infrastructure Bank (AIIB) as an alternative to the IMF or the World Bank.

The European Union is not spared from the multilateral disaster either because it has been attributed the shared skill in common security matters in subject of public health (TFEU: art. 4.k)). On 17 March, the European committee took the incoherent decision to close external borders with third states when the virus was already inside instead of temporarily and imperatively fail the Schengen Treaty. On the economic front, inequality and suspicion between the debt-prone countries of the North and the South have increased. The refusal of the Netherlands, Finland, Austria and other frugals to the unconditional financial aid required by a country like Spain, which has more official and political cars than the rest of Europe and the United States combined, called into question one of the fundamental principles on which the European Union was built: solidarity.

Europe has been the perfect storm in a sea of uncertainty and Spain, the eye of the hurricane. The European economic recovery fund is a term that overshadows what it really is: a financial bailout. A total of 750 billion euros divided mainly between Italy, Portugal, France, Greece and Spain, which will receive 140 billion euros and will be paid back by our grandchildren's children. It seems fanciful that the first health aid Italy received came from third states and not from its EU partners, but it became a reality when the first planes from China and Russia landed at Fiumicino airport on 13 March. The pandemic is proving to be an examination of conscience and credibility for the EU, a sinking ship with 28 crew members trying to bail out the water that is slowly sinking it.

Leading scholars and politicians confirm that states need multilateralism to respond jointly and effectively to the great risks and threats that have crossed borders and to maintain global peace. However, this idea collapses when it is realised that today's leading figure in bilateralism, Donald J. Trump, is the only US president since 1980 not to have started a war in his first term, to have brought North Korea closer, and to have secured recognition of Israel by Bahrain and the United Arab Emirates.

It is time to shift geopolitics towards updated and consensus-based solutions based on cooperative governance rather than global governance led by obsolete and truly powerful institutions. Globalist multilateralism that seeks to unify the actions of countries with very disparate cultural and historical roots under a single supranational entity to which they cede sovereignty can cause major clashes within the entente, provoke the departure of some of the disgruntled members, the subsequent extinction of the intended organisation and even enmity or a rupture of diplomatic relations.

However, if states with similar values, laws, customary norms or interests decide to come together under a treaty or create a regulatory institution, even while ceding just and necessary sovereignty, the understanding will be much more productive. Thus, a network of bilateral agreements between regional organisations or between states has the potential to create more precise and specific objectives, as opposed to signing a globalist treaty where long letters and lists of articles and members can become smoke and mere declarations of intent as has been the case with the Paris Climate Change Convention in 2015.

This last idea is the true and optimal future of International Office: regional bilateralism. A world grouped in regional organisations made up of countries with similar characteristics and objectives that negotiate and reach agreements with other groups of regions through dialogue, peaceful understanding, the art of diplomacy and binding pacts without the need to cede the soul of a state: sovereignty.

Categories Global Affairs: World order, diplomacy and governance Comments Global

Joe Biden and Barack Obama in February 2009, one month after arriving at the White House [Pete Souza].

Joe Biden and Barack Obama in February 2009, one month after arriving at the White House [Pete Souza].

COMMENTARY / Emili J. Blasco

This article was previously published, in a somewhat abbreviated form, in the newspaper 'Expansión'.

One of the great mistakes revealed by the US presidential election is to have underestimated the figure of Donald Trump, believing him to be a mere anecdote, and to have disregarded much of his politics as whimsical. In reality, the Trump phenomenon is a manifestation, if not a consequence, of the current American moment, and some of his major decisions, especially in the international arena, have more to do with domestic imperatives than with fickle whimsy. The latter suggests that there are aspects of foreign policy, manners aside, in which Joe Biden as president may be closer to Trump than to Barack Obama, simply because the world of 2021 is already somewhat different from that of the first half of the previous decade.

First, Biden will have to confront Beijing. Obama began to do so, but the more assertive character of Xi Jinping's China has been accelerating in recent years. In the superpower tug-of-war, especially over the dominance of the new technological age, the US has everything at stake vis-à-vis China. It is true that Biden has referred to the Chinese not as enemies but as competitors, but the trade war was already begun by the administration of which he was vice-president and now the objective rivalry is greater.

Nor is the US's withdrawal the result of Trump's madness. Basically it has to do, to simplify somewhat, with the energy independence achieved by the Americans: they no longer need oil from the Middle East and no longer have to be in all the oceans to ensure the free navigation of tankers. America First' has in a way already been started by Obama and Biden will not go in the opposite direction. So, for example, no major involvement in EU affairs and no firm negotiations for a free trade agreement between the two Atlantic markets can be expected.

On the two major achievements of the Obama era - the agreement nuclear deal with Iran sealed by the US, the EU and Russia, and the restoration of diplomatic relations between Washington and Havana - Biden will find it difficult to tread the path then defined. There may be attempts at a new rapprochement with Tehran, but there would be greater coordination against it on the part of Israel and the Sunni world, which are now more convergent. Biden may find that less pressure on the ayatollahs pushes Saudi Arabia towards the atom bomb.

As for Cuba, a return to dissent will be more in the hands of the Cuban government than of Biden himself, who in his electoral loss in Florida has been able to read a rejection of any condescension towards Castroism. Some of the new restrictions imposed by Trump on Cuba may be dismantled, but if Havana continues to show no real willingness to change and open up, the White House will no longer have to continue betting on political concessions to credit .

In the case of Venezuela, Biden is likely to roll back a good part of the sanctions, but there is no longer room for a policy of inaction like Obama's. That administration did not confront Chavismo for two reasons. That Administration did not confront Chavismo for two reasons: because it did not want to upset Cuba, given the secret negotiations it was holding with that country to reopen its embassies, and because the regime's level of lethality had not yet become unbearable. Today, international human rights reports are unanimous on the repression and torture of Maduro's government, and the arrival of millions of Venezuelan refugees in the different countries of the region means that it is necessary to take action on the matter. Here it is to be hoped that Biden will be able to act less unilaterally and, while maintaining pressure, seek coordination with the European Union.

It is often the case that those who come to the White House deal with domestic affairs in their first years and then later, especially in a second term, focus on leaving an international bequest . Due to age and health, the new occupant may only serve a four-year term. Without Obama's idealism of wanting to 'bend the arc of history' - Biden is a pragmatist, a product of the US political establishment - or businessman Trump's rush for immediate gain, it is hard to imagine that his administration will take serious risks on the international stage.

Biden has confirmed his commitment to begin his presidency in January by reversing some of Trump's decisions, notably on climate change and the Paris agreement ; on some tariff fronts, such as the outgoing administration's unnecessary punishment of European countries; and on various immigration issues, especially concerning Central America.

In any case, even if the Democratic left wants to push Biden to the margins, believing that they have an ally in Vice President Kamala Harris, the president-elect can make use of his staff moderation: the fact that in the elections he obtained a better result than the party itself gives him, for the moment, sufficient internal authority. The Republicans have also held their own quite well in the Senate and the House of Representatives, so that Biden comes to the White House with less support on Capitol Hill than his predecessors. That, in any case, may help to reinforce one of the Delaware politician's generally most valued traits today: predictability, something that the economies and foreign ministries of many of the world's countries are eagerly awaiting.

Categories Global Affairs: North America World order, diplomacy and governance Comments

The current president made only one visit, also at the framework of the G-20, compared to the six that Bush and Obama made in their first four years.

International travel does not tell the whole story about a president's foreign policy, but it does give some clues. As president, Donald Trump has only travelled once to Latin America, and then only because the G20 summit he was attending was being held in Argentina. It is not that Trump has not dealt with the region - of course, Venezuela policy has been very present in his management- but the fact that he has not made the effort to travel to other countries on the continent reflects the more unilateral character of his policy, which is not very focused on gaining sympathy among his peers.

signature in Mexico in 2018 of the free trade agreement between the three North American countries [department of State, USA].

▲ signature in Mexico in 2018 of the free trade agreement between the three North American countries [department of State, USA].

article / Miguel García-Miguel

With only one visit visit to the region, the US president is the one who has made the fewest official visits since Clinton's first term in office, who also visited the region only once. In contrast, Bush and Obama paid more attention to the neighbouring territory, both with six visits in their first term. Trump focused his diplomatic campaign on Asia and Europe and reserved Latin American affairs for visits by the region's presidents to the White House or his Mar-a-Lago resort.

In reality, the Trump administration spent time on Latin American issues, taking positions more quickly than the Obama administration, as the worsening problem in Venezuela required defining actions. At the same time, Trump has discussed regional issues with Latin American presidents during their visits to the US. There has not, however, been an effort at multilateralism or empathy, going to his meeting in their home countries to deal with their problems there.

Clinton: Haiti

The Democratic president made only one visit to the region during his first term in office: visit . refund After the Uphold Democracy operation to bring Jean-Bertrand Aristide to power, on 31 March 1995 Bill Clinton travelled to Haiti for the transition ceremony organised by the United Nations. The operation had consisted of a military intervention by the United States, Poland and Argentina, with UN approval, to overthrow the military board that had forcibly deposed the democratically elected Aristide. During his second term, Clinton paid more attention to regional affairs, with thirteen visits.

Bush: free trade agreements

Bush made his first presidential trip to neighbouring Mexico, where he met with then President Fox to discuss a range of issues. Mexico paid attention to the US government's attention attention to Mexican immigrants, but the two presidents also discussed the functioning of the North American Free Trade Agreement (NAFTA), which came into force in 1994, and joint efforts in the fight against drug trafficking. The US president had the opportunity to visit Mexico three more times during his first term in office for the purpose of attend multilateral meetings. Specifically, in March 2002, he attended the lecture International Meeting on Financing for the development, organised by the United Nations and which resulted in the Monterrey Consensus; Bush also took the opportunity to meet again with the Mexican president. In October of the same year he attended the APEC (Asia-Pacific Economic Cooperation) summit, which that year was held in the Mexican enclave of Los Cabos. Finally, he set foot on Mexican soil once again to attend the Special Summit of the Americas held in Monterrey in 2004.

During his first term in office, Bush pushed for the negotiation of new free trade agreements with several American countries, which was the hallmark of his administration's policy towards the Western Hemisphere. framework As part of this policy, he travelled to Peru and El Salvador on 23 and 24 March 2002. agreement In Peru, he met with the President of Peru and the Presidents of Colombia, Bolivia and Ecuador, in order to reach an agreement to renew the ATPA (Andean Trade Promotion Act), by which the US granted tariff freedom on a wide range of exports from these countries. The matter was finally resolved with the enactment in October of the same year of the ATPDEA (Andean Trade Promotion and Drug Eradication Act), which maintained tariff freedoms in compensation for the fight against drug trafficking, in an attempt to develop the region economically in order to create alternatives to cocaine production. Finally, in the case of El Salvador, he met with the Central American presidents to discuss the possibility of a Free Trade Agreement with the region (known in English as CAFTA) in exchange for a strengthening of security in the areas of the fight against drug trafficking and terrorism. The treaty was ratified three years later by the US congress . Bush revisited Latin America up to eleven times during his second term.

 

Graph 1. Own elaboration with data of Office of the Historian

 

Obama: two Summits of the Americas

Obama began his tour of diplomatic visits to Latin America with attendance to the Fifth Summit of the Americas, held in Port-au-Prince (Trinidad and Tobago). The Summit brought together all the leaders of the sovereign countries of the Americas, with the exception of Cuba, and was aimed at coordinating efforts to recover from the recent crisis of 2008, with mentions of the importance of environmental and energy sustainability. Obama returned to attend in 2012 to the VI Summit of the Americas held this time in Cartagena de Indias (Colombia). No representatives from Ecuador or Nicaragua attended this summit in protest at the exclusion of Cuba to date. Neither the President of Haiti nor Venezuelan President Hugo Chávez attended, citing medical reasons. At the summit, the issues of Economics and security were once again discussed, with the war on drugs and organised crime being of particular relevance, as well as the development of environmental policies. He also took advantage of this visit to announce, together with Juan Manuel Santos, the effective entrance of the Free Trade Agreement between Colombia and the US, negotiated by the Bush Administration and ratified after some delay by the US congress . The Democratic president also had the opportunity to visit the region on the occasion of the G-20 meeting in Mexico, meeting , but this time the main focus of topic was on solutions to curb the European debt crisis.

In terms of bilateral meetings, Obama undertook a diplomatic tour of Brazil, Chile and El Salvador between 19 and 23 March 2010, meeting with their respective presidents. He used the occasion to resume relations with the Brazilian left that had governed the country since 2002, to reiterate his economic and political alliance with Chile, and to announce a $200 million fund to strengthen security in Central America. During his second term in office, he made up to seven visits, including the resumption of diplomatic relations with Cuba, which had been paused since the triumph of the Revolution.

Trump: T-MEC

Donald Trump only visited Latin America on one occasion to attend meeting the G-20, a meeting that was not even regional, held in Buenos Aires in December 2018. Among the various agreements reached were the reform of the World Trade Organisation and the commitment of the attendees to implement the measures adopted at the Paris agreement , with the exception of the US, since the president had already reiterated his determination to withdraw from the agreement. Taking advantage of the visit, he signed the T-MEC (Treaty between Mexico, the United States and Canada, the new name for the renewed NAFTA, the renegotiation of which Trump had demanded) and met with the Chinese president in the context of the trade war. Trump, on the other hand, did not attend the VIII Summit of the Americas held in Peru in April 2018; the trip, which was also supposed to take him to Colombia, was cancelled at the last minute because the US president preferred to remain in Washington in the face of a possible escalation of the Syrian crisis.

The reason for the few visits to the region has been that Trump has directed his diplomatic campaign towards Europe, Asia and to a lesser extent the Middle East, in the context of the trade war with China and the loss of power on the US international stage.

 

Graph 2. Own elaboration with data of Office of the Historian

 

Only one trip, but monitoring of the region

Despite having hardly travelled to the rest of the continent, the Republican candidate has paid attention to the region's affairs, but without leaving Washington, as up to seven Latin American presidents have visited the White House. The main focus of the meetings has been the economic development and the reinforcement of security, as usual. Depending on the reality of each country, the meetings revolved more around the possibility of future trade agreements, the fight against drugs and organised crime, preventing the flow of illegal immigration to the United States, and the search to strengthen political alliances. Although the US government website does not list it as an official visit , Donald Trump also met at the White House in February 2020 with Juan Guaidó, recognised as president in charge of Venezuela.

Precisely, if there has been a common topic to all these meetings, it has been the status economic and political crisis in Venezuela. Trump has sought allies in the region to encircle and put pressure on Maduro's government, which is not only an example of continuous human rights violations, but also destabilises the region. The ironclad civil service examination to the regime served Donald Trump as propaganda to gain popularity and try to save the Latino vote in the November 3 elections, and that had its award at least in the state of Florida.

 

Graph 3. Own elaboration with data of Office of the Historian

Categories Global Affairs: North America World order, diplomacy and governance Articles Latin America

COMMENTARY / Rafael Calduch Torres*.

As tradition dictates since 1845, on the first Tuesday of November, the 3rd, the eligible voters of the fifty states that make up the United States will take part in the fifty-ninth Election Day, the day on which the high school Electoral, which will have to choose between keeping the forty-fifth President of the United States of America, Donald Trump, or electing the forty-sixth, Joe Biden.

 

But the real problem facing not only the inhabitants of the US, but also the rest of the world's population, is that both Trump and Biden are setting out their international strategy at core topic domestically, following in the wake of the change that took place in the country following the 9/11 attacks and whose fundamental result has been the absence of effective leadership of the American superpower over the last twenty years. For if there is one thing that must be clear to us, it is the fact that none of the candidates, like their predecessors, has a plan to restore the international leadership that the United States enjoyed until the end of the 1990s; On the contrary, what they are urged to do is to solve domestic problems and subordinate international issues, which a superpower of the stature of the US must face, to the solutions adopted domestically. This is one of the serious strategic errors of our era, since strong international leaderships that are coherent with the management of domestic problems have historically allowed the creation of points of meeting in US society that cushion divisions and bring the country together.

However, despite these broad similarities, there is a clear difference between the two candidates in their approach to international issues that will affect the outcome of the choice Americans will make on Tuesday.

"The Power of America's example. With this slogan, Biden's general proposal , much clearer and more accessible than Trump's, develops a plan to lead the democratic world in the 21st century based on using the way in which America's domestic problems will be solved as an example, binding and sustaining its international leadership; it goes without saying that the mere assumption that America's domestic problems are not exactly extrapolable to the rest of the international actors is not even taken into account.

Thus, the Democratic candidate , using a fairly traditional rhetoric on the dignity of leadership, uses the connection between domestic and international reality to propose a programme of national regeneration without specifying how this will succeed in re-establishing the lost international leadership. This approach will be based on two main pillars: the democratic regeneration of the country and the reconstruction of the US class average which, in turn, will underpin other international projects.

Democratic regeneration will be based on strengthening the educational and judicial systems, transparency, the fight against corruption and an end to attacks on the media, and is seen as the instrument for restoring the country's moral leadership, which, in addition to inspiring others, would serve for the US to transfer these US domestic policies to the international arena, for others to follow and imitate through a sort of global league for democracy that seems very nebulous to us.

Meanwhile, the reconstruction of the class average , the same one Trump appealed to four years ago, would involve greater investment in technological innovation and supposedly greater global equity in international trade, from which the United States would benefit the most.

Finally, all of the above would be complemented by a new era in international arms control through a new START treaty between the US and Russia, US leadership in the fight against climate change, an end to interventions on foreign soil, particularly in Afghanistan, and the re-establishment of diplomacy as the backbone of US foreign policy.

"Promises Made, Promises Kept!What is Trump's alternative? The current President does not reveal what his projects are, but he does propose a review of his "achievements" which, we understand, will give us an idea of what his foreign policy will be, which will revolve around the continuity of the US trade rebalancing based, as until now, on shielding US companies from foreign investment, the imposition of new tariffs, the fight against fraudulent trade practices, especially on the part of China, and the restoration of US relations with its allies in Asia/Pacific, the Middle East and Europe, but without specific proposals.

With regard to security, which Trump treats differently, the recipe is increased defence spending, the shielding of US territory against terrorism and opposition to North Korea, Venezuela and Iran, to which will be added the maintenance and expansion of the recent campaign of actions directed specifically against Russia, with the declared goal to contain it in Ukraine and to prevent cyber-attacks.

But the reality is that both candidates will have to face global challenges that they have not considered in their programmes and that will decisively condition their mandates, starting with the management of the pandemic and its economic effects on a global scale and including the growing competition from the European Union, especially as its common military and defence capabilities develop.

As we have just seen, none of the candidates will offer new solutions and therefore the situation is unlikely to improve, at least in the short term deadline.

* PhD in Contemporary History. graduate in Political Science and Administration. Lecturer at the UNAV and the UCJC.

Categories Global Affairs: North America World order, diplomacy and governance Comments

WORKING PAPER / María del Pilar Cazali

 

[Download the document]

 

ABSTRACT

The Brexit deal has led to a shift in the UK's relationship not only with the European Union but also with other countries around the world. Africa is key in the new relationships the UK is trying to build outside from the EU due to their historical past, the current Commonwealth link, and the important potential trade deals. This article looks to answer how hard the UK will struggle with competition in the African country as an individual state, no longer member of the EU. These struggles will be especially focused on trading aspects, as they are the most important factors currently for the UK in the post-Brexit era, and it's also the strongest focus of the EU in Africa.

Categories Global Affairs: European Union World order, diplomacy and governance Documents of work

[Peter Zeihan, Desunited Nations. The Scramble for Power in an Ungoverned World (New York: Harper Collins, 2020) 453 pgs]

review / Emili J. Blasco

Desunited Nations. The Scramble for Power in an Ungoverned World The world seems to be heading towards what Peter Zeihan calls "the great disorder". His is not a doomsday vision of the international order for the mere pleasure of wallowing in pessimism, but a fully reasoned one. The retreat of the United States is leaving the world without the ubiquitous presence that secured the global structure we have known since the Second World War, forcing other countries into more insecure intercontinental trade and to seek their livelihoods in an environment of "disunited nations".

Zeihan has long been drawing consequences from his seminal idea, set out in his first book, The Accidental Superpower (2014): the success of fracking has given the US energy independence, so it no longer needs Middle Eastern oil and will progressively withdraw from much of the world. In his next book, The Absent Superpower (2016), he detailed how US withdrawal will leave other countries unable to secure important maritime trade routes and reduce the proliferation of developed contacts in this era of globalisation. The latter has now been accelerated by the Covid pandemic, which came as a third volume, Desunited Nations (2020), was about to be published. Zeihan did not have time to include a reference letter to the ravages of the virus, but there was no need because his text went in the same direction in any case.

Zeihan, a geopolitical analyst who worked with George Friedman at Stratfor and now has his own signature, looks this time at how the different powers will adapt to the 'great disorder' and which of them have the best prospects. The book is "about what happens when the global order is not only crumbling, but when many leaders feel that their countries will be better off tearing it down". And it's not just about the Trump administration: "the push for American retreat did not start with Trump, nor will it end with him," says Zeihan.

The author believes that, in the new outline, the United States will remain a superpower, China will not achieve a hegemonic position and Russia will continue its decline. Among other minor powers, France will lead the new Europe (not Germany; while the British are "doomed to a multi-year depression"), Saudi Arabia will give more concern to the world than Iran and Argentina will have a better future than Brazil.

To focus on the US-China rivalry, it would be good to pick up on some of Zeihan's arguments for his scepticism about the consolidation of China's rise.

To be an effective superpower, China needs greater control of the seas. The problem is not to build a large, outward-facing navy, but, since it is already difficult to sustain such a huge effort over time, it must also simultaneously have "a huge defensive navy and a huge air force and a huge internal security force and a huge army and a huge intelligence system and a huge special forces system and a global deployment capability".

For Zeihan, the question is not whether China will be the next hegemon, which "it cannot be", but "whether China can even hold together as a country". The impossibility of feeding its entire population on its own, the lack of sufficient energy sources of its own, strong territorial imbalances and demographic constraints, such as the fact that there are 41 million Chinese men under the age of 40 who will never be able to marry, are all factors that work against China's ability to remain united.

It is not uncommon for American authors to predict a future collapse of China. However, episodes such as the coronavirus, initially seen as a serious stumbling block for Beijing, have never really cut short the forward march of the Asian colossus, even though China's economic growth figures have naturally been moderating over the years. This is why many people's bad omens can sometimes be interpreted more as wishful thinking than realistic analysis. Zeihan certainly writes in a somewhat "loose" manner, with blunt assertions that seek to shake the reader, but his geopolitical axioms seem to be generally endorsed: if you boil down what he says in his three books, you have a clear notice of where the world is supposed to be going; and that is where it is indeed going.

Categories Global Affairs: World order, diplomacy and governance Book reviews Global

COMMENTARY / Juan Luis López Aranguren

If traditional diplomacy is understood as relations exercised between official representatives of states, in recent years a new concept of diplomacy has gained popularity and has become increasingly important in relations between nations: cultural diplomacy. Assuming that culture is the vehicle through which nations communicate with each other, cultural diplomacy is the exchange of culture, ideas and information that nations around the world engage in to achieve mutual understanding in order to advance the building of a more just and stable world. In this context, the celebration of the Olympic Games is one of the most important cultural diplomacy events that a nation can achieve to project and share its culture and identity with the rest of the world. In this sense, Japan reaffirmed its position as a global benchmark in this diplomacy with its public appearance at the closing ceremony of the Rio 2016 Olympic Games. Japanese Prime Minister Shinzo Abe appeared in the guise of the world-famous character Mario to pick up the baton for the Tokyo 2020 Olympics. In this way, Japan used an icon of Japanese pop culture to project its cultural identity to the entire world. 

In this dimension of soft power or cultural diplomacy, the Olympic Games are the greatest exponent of it. Already at their origin, in 776 BC, the Olympic Games proved to be a diplomatic tool of extraordinary strength by forcing a sacred truce between the different city-states participating in them. Therefore, from the very beginning, it was possible to achieve international political objectives by using this cultural tool . This measure was observed to the extent that if any city-state violated this truce, its athletes were expelled from the competition.

This same demonstration has been repeated in more recent times, demonstrating that the Olympics have been a diplomatic battleground throughout history. In 1980 the US and 65 other countries boycotted the Moscow Olympics in protest at the USSR's invasion of Afghanistan. In retaliation, the USSR and 13 other states boycotted the next Olympics in 1984 in Los Angeles.

The upcoming Tokyo 2021 Olympic Games (delayed by one year due to the pandemic) do not carry any controversy from this subject. Instead they have been conceived as a historic opportunity for the country to reinvent itself internally and globally after the Fukushima (or Great East Japan Earthquake) catastrophe. C To this end, an official project graduate Tokyo 2020 Action & Legacy Plan 2016 has been launched, which aims to achieve three objectives: firstly, to maximise the connection of Japanese citizens and communities with the Tokyo Olympics. Secondly, to maximise cultural projection both nationally and globally. Thirdly and lastly, to ensure a valuable bequest for future generations, as was the case with the Tokyo 1964 Olympic Games.

These three objectives set out by the Japanese government will be manifested in five dimensional pillars on which action will be taken. These five pillars are articulated in the manner of Olympic rings, intertwining with each other and strengthening the domestic and international impact of these Olympic Games. These dimensions are, starting with the most immediate to the purely sporting aspect itself, the promotion of sport and health. The second, connecting with culture and Education. The third, also of great importance for its potential to reform Tokyo in particular and Japan in general, is urban planning and sustainability. Not surprisingly, the Japanese government and the Tokyo Metropolitan Government have made great efforts to build ambitious infrastructure to accommodate the Olympics, even to the extent of relocating the famous and iconic Tsukiji fish market that has been a symbol of the city since 1935. Fourthly, the Olympics will be used to revive Economics and technological innovation, in the same way as the 1964 Tokyo Olympics did when it showcased the first Shinkansen or bullet trains that have become one of Japan's technological icons. Finally, fifthly, Japan saw the Olympics as an opportunity to overcome the crisis and trauma caused by the Fukushima disaster (a catastrophe that is referred to in Japan as the Great East Japan Earthquake).

In addition to these five objectives, which range from the more specific to the more general, a sixth goal or unofficial dimension will be added in 2020: to project Japan's recovery from the COVID pandemic both domestically and internationally. In this sense, the Olympic Games will not only be a symbol of overcoming a particular Japanese disaster, but may also enable Japan to position itself as a model in the management against the pandemic and in promoting economic recovery.

Categories Global Affairs: Asia World order, diplomacy and governance Comments

Nicolás Maduro during a broadcasted speech [Gov. of Venezuela].

Nicolás Maduro during a broadcasted speech [Gov. of Venezuela] ▲ Nicolás Maduro during a broadcasted speech [Gov. of Venezuela].

ESSAY / Isabelle León Graticola

It is no secret to anyone that Venezuela is going through the most convoluted economic and social crisis in its history, a crisis in which the creators have manipulated the existence of the people, degrading its integrity, and extinguishing everything that once characterized Venezuela.

The country holds a key geopolitical location that serves as a route for North America and the Caribbean to the rest of South America. Likewise, the country is endowed with abundant natural resources like natural gas, iron ore, diamonds, gold, and oil.1 Venezuela has the largest proven oil reserves in the world, with 302 billion barrels in January 2018, emanating an extremely rich country with astonishing potential.2 However, this crisis has not only hindered people's lives but has ironically dissipated the country's resources to consolidate the pillars of the regime to such an extent that today the government of Nicolás Maduro is importing oil from Iran. Inadequate policies that have weakened the society's sense of responsibility and nationalism, decreased foreign investment out of lack of trust, and annihilated the state-led oil production, therefore reinforcing the country's economic downfall and hyperinflation.

The Venezuelan government, headed by Nicolás Maduro, has managed its way to continue holding power despite accusations of corruption, crimes against humanity, and even drugs trafficking involvement. The perplexing partner-economic and political crisis has created an unsustainable and violent context in which poorly informed people are manipulated by the government through speeches that take big significance on how society perceives the actual situation, as well as other countries' statements on the crisis. Up to this point, it has become difficult to understand what keeps bolstering this regime, but if the situation is analysed from the nucleus, the well-orchestrated rhetoric of Chávez and his successor, Maduro, has contributed to support the ends and sustainment of the regime. 

Since Maduro reached power, poverty motivated violence has been rampant in Venezuela and insecurity has become a significant part of society's dynamics. Consequently, many protests against the government demanding for freedom and better living standards have taken place. Maduro's regime has been forced to employ tools such as fake news and hateful rhetoric to soften the anger of the people by manipulating them and brainwashing the armed forces to avoid uprisings. 

This article aims to analyse how Maduro's rhetoric has maintained a minority in the wrong side of history and a majority in constant battle by making erroneous accusations to third parties to justify the perturbed situation, while the government keeps enriching its wallet at the cost of the people and its smudged operations. Such feverish society gave rise to pure uncertainty, to a place where disinformation takes the form of a lethal weapon for the dangerous context in which it exists.

The background: Chávez's indoctrinated society

First, it is necessary to clarify that the focus of this article is merely on the rhetorical aspect as a pillar of the regime. However, when it comes to the background that has sustained Maduro's administration up to this day, there is a more complex reality, full of crime, death, manipulation, and corruption. Venezuela is an almost abnormal reality because, after more than twenty years, it is still tied to a group of people who have taken absolutely everything from it. From a man that portrayed nothing but hope for the poor, to one who has managed his way sticking to policies damaging to the very people they mean to help, and which, sooner or later, will make the regime collapse.

Hugo Chávez's presidency was characterized by a tremendous and persuasive oratory; he knew how to get to the people. Chávez's measures and campaigns were based on a psychological strategy that won him the admiration of the most impoverished classes of the country. Chávez arrived and gave importance and attention to the big mass of the population that previous governments had systematically neglected. People felt the time had come for them to have what they never had before. Filled with charisma and political mastery, his speeches always contained jokes, dances, and colloquial phrases that were considered indecent by the country's highest class and often misunderstood abroad.

Chávez always built a drastic separation between the ideals of the United States and Venezuela and looked for ways to antagonize the former with his rhetoric. He began to refer to George W. Bush as "Mr. Danger", an imperial literary character of one of the most famous Venezuelan novels, Doña Bárbara.3

Hugo Chávez is one of the most revolutionary characters in Venezuelan history, one who brought the convoluted situation that today perpetuates in the country. Chávez persecuted journalists and political opponents, expropriated lands, nationalized Venezuela's key industries such as telecommunications, electricity, and the refining processes of heavy crudes, and slowly degraded the society as the exercise of power was directed to hold complete control of Venezuela's internal dynamics.4

Chávez extended education and medical assistance to the least favoured classes and improved the living conditions of the needy. This policy did nothing but create among these classes a culture of dependence on the government. Chávez's supporters or Chavistas were the pillars that buttressed the government, while the wealthy were catalogued as "squealing pigs" and "vampires. "5 The Chavistas admired Chavez's charismatic character and his constant gifts; he gave them fridges and TVs, gadgets that they could never afford on their own. He also constructed buildings, under the "mission statement Vivienda" initiative, to give people living in slums a 'proper' home. All of this was possible because the oil prices at the time were skyrocketing; he used the oil income to buy his support. The general standard of life, however, continued to be poor. The government knew what to give and how to manipulate to stay in power, and that is precisely what made Hugo Chávez so powerful and almost impossible to defeat despite strong opposition. 

Historically, the United States has opposed left-wing governments in Latin America, so Chávez condemned the US, by referring to them as an imperialist power, or the "Empire". He disgraced US leaders and actions and transferred that anti-imperialistic and anti-capitalist approach to the population, part of which supported him and was blindly loyal to the cause. Chávez's alliance with Cuba under Fidel Castro led to the supply of oil at cut-rate prices, all related to the desire of reducing US economic influence in South America. Chávez's populist initiatives were the tenets of his administration and controversial foreign policy. These, along with his rhetoric and opposition from the Venezuelan wealthy class, deeply polarized the society and gave rise to what Venezuela has today: a divided society that has suffered from the lack of basic necessities, disinformation, and integrity.

Currently, the spokesmen of the Government of Nicolás Maduro address citizens at all hours from public channels and social networks to stir up the disgruntlement of the population toward the external enemy.6 Despite the poorly prepared speeches, the lack of vocabulary, and the improper formulation of sentences, Maduro has kept the colloquial and unformal rhetoric that characterised Chávez, but has failed to draw the connection that the late president enjoyed. The anti-imperialist strategy has been maintained, and, as the justification of the crisis, it has become the epicenter of the regime's speech. Nicolás Maduro's rhetoric revolves around two words: the US and the "Patria", a word frequently used by Chávez.

The base of Maduro's rhetoric: the love for Chávez

Shortly before dying in March 2013, Hugo Chávez appointed Vice President Nicolás Maduro as his successor. Chávez's charisma and legacy are what somehow ensured him that Maduro would provide a smooth transition. After Chávez's passing, Maduro took advantage of the momentum and sentiment that the Chavistas revealed and ensured that if picked, he would follow the steps of his predecessor and would continue to strengthen the 'Bolivarian Revolution'. Along with the continuity with Chávez's legacy, the defence of Venezuelan sovereignty in front of the US, and the social equality became the key messages of his administration.7 Nevertheless, Maduro had little support from the elites and inherited a country that was already economically weak due to the downfall of the oil prices and corruption.

In Chávez's wake, Maduro appealed to the emotion of the audience. He strongly claimed that the people were there for the 'Comandante' and said that "his soul and his spirit was so strong that his body could not stand it anymore, and he was released and now through this universe expanding filling us with blessings and love". He knew what this meant for the people and a crying audience exclaimed "Chávez lives, the fight goes on".

Maduro filled his rhetoric with the love for Chávez. He acknowledged that the Chavistas worshipped him as if he was God and that for ideological reasons, support for Maduro was guaranteed. Nevertheless, others recognised that the situation in the country was not favourable and questioned Maduro's ability to fill the void left by Chávez. When Maduro took power, the country entered a period of reinforced economic decline accompanied by hyperinflation that nowadays exceeds 10 million percent.8 As it was previously stated, the conditions of poverty surpass anything seen before in the country, which is now on the brink of collapse.

Furthermore, Venezuela went through two rounds of mass protests, in 2014 and 2018, that demanded freedom and change. Unfortunately, and as was expected from the government, thousands of violations of human rights were part of the demonstration's dynamics as brutal repression and the unjust imprisonment of demonstrators took place all along. Simultaneously, Maduro managed to call for rallies on the days of the major opposition's marches and retained the populist speech based on ideological arguments and emotional appeals among the minority of supporters to consolidate his power in Venezuela. Last year, in a regime rally on February 23rd, he condemned the elites as he explained that he was certain that from the bottom of his Chavista sentiment of loyalty to this battle, he was never going to be part of one. He stated that Venezuela will continue to be Patria for more many years to come. 

The ongoing crisis has forced many to survive rather than to live, but despite all, Maduro remains in control. Maduro has kept Chávez's anti-imperialist policy and has rejected any minimum support from the United States. The government takes advantage of the hunger and the vulnerable situation of its people and makes sure that it remains as the only source of food. It does not take responsibility and instead, blames the crisis on the 'economic war' that the US has imposed on Venezuela.9 When Juan Guaidó sworn himself the legitimate president, Maduro's supporters started raising firms in a campaign called "Hands off Venezuela", while the US was trying to get humanitarian assistance into Venezuela through the Colombian border in the name of Guaidó. 

In this sense, he explained in the same concentration speech that they were defending the national territory and the right to live freely and independently. Although it may seem ironic, because the government has killed hundreds of people with its police brutality and torture, this rhetoric is what has kept him the support of the hardcore revolutionary followers. The "Hands off Venezuela", was shouted and accompanied by the worst English pronunciation -that characterizes Maduro-, and followed with insults to Guaidó.

As Maduro yelled "puppet, clown, and beggar of imperialism and Donald Trump. If he is the President, where are the economic and social measures that he has applied for the people? It is a game to deceive and manipulate, it is a game that has failed, the coup d'état has failed" as the network audience shouted, "jail him, jail him!". He drew his speech to a hardcore anti-imperialist audience and firmly stated that the US intended to invade Venezuela and enslave it. Maduro finalized his speech by shouting "wave up the flag, up the Patria, for the people in defense of the Revolution".

Recently, the US State Department released a price for the capture of Maduro and his cabinet, not only for the crimes committed against the Venezuelan population, but also because of their involvement in a huge drug-trafficking network. With this, the regime's position has become more vulnerable and simultaneously pragmatic, but as tough actions were taken against possible threats and opposing figures, Maduro's rhetoric remains to deny its status and manipulating those that still support him. In another public speech, he stated that "Donald Trump's government, in an extravagant and extreme, vulgar, miserable action, launched a set of false accusations and like a racist cowboy of the 21st century, put a price on the heads of revolutionaries that are still willing to fight them". He one more time accused the US of being the main cause of the economic crisis of Venezuela.

Nicolás Maduro's speech has always been directed to the hardcore revolutionaries, those that worship Chávez since the beginning and who firmly believe in the socialist cause. Maduro has maintained his rhetoric despite the changes in the internal situation of the country; he has held an enduring method for antagonizing the opposition, the Venezuelan upper class, and the United States. On the other hand, regarding the strategic foreign allies, the regime openly gives declarations to support them, but again to somehow antagonize the United States. Indeed, this was the case of the US assassination of Qasem Soleimani, the Iranian top commander, in which government representatives attended the Iranian embassy to give the condolences in the name of the regime and swore to avenge Soleimani's death. The administration of Nicolás Maduro has no gray areas, everything is either black or white; the opposition, the upper class, the US, and the US-influenced countries are the enemies, and the rhetoric rarely leans toward a conciliatory message, rather has always revolved around these conflicting parties.

What is left

Twenty years have passed since the Chavismo arrived in the country. Nowadays, a passionate minority of the population keeps supporting Maduro. His regime continues to train armed groups to combat discontent headed by opposition leader Juan Guaidó. The Chavismo keeps being strong, but it has been fragmented by those who believe that the revolution ended at the moment Chávez died, and the ones that are convinced that supporting Maduro means being loyal to Chávez. In the case of Juan Guaidó, he keeps doing his efforts. He still has relative support and keeps being a source of hope. Nevertheless, many criticize the fact that he let again the people cool down. A close change is expected, but no one knows what the movements behind are. Meanwhile, the people will continue suffering and trying to survive.

Upon reflection, it can be noticed that Maduro's entire argumentation revolves around a confrontational rhetoric: the US and capitalism against Venezuela; Guaidó against the Patria; the elites against the Revolution.10 Far from recognising the reality that the country faces and taking actions to improve it, this confrontational approach simply places the blame on those who have tried to bring a change in the internal dynamics of Venezuela. The regime has managed to construct a national united front against a common foreign enemy and to demonize the opposition.

Chávez and Maduro's rhetoric has followed a tangible objective: the Revolution. Maduro's regime up to this point is searching for a way to consolidate its power and sustain itself as the best way to elude a rather somber future in jail. This never-ending nightmare should have long ago collapsed due to the economic catastrophe, hyperinflation, political repression, human rights violations, and the lack of direction for Venezuela. Behind what maintains this structure there is nothing but the exercise of power and the almost absolute control of society. The Patria that they constantly speak of is running out of fuel to keep going. Nonetheless, the rhetorical deceptions of the Bolivarian revolution, which for two decades have appealed to the popular classes, settled in the collective mindset of the Chavismo and brought space for support in the Venezuelan society.

Chávez and Maduro's presidencies have been based on educating and changing the mindset of the population as they wanted; a population that is content with one box of food a month and which, unfortunately, hunts for the easy means to achieve its goals instead of fighting to improve its lot.

Today, the regime is fed on the memory of Hugo Chávez, on his promises, on his battle. As long as it keeps generating an illusion on the supporters, Maduro will appeal to it as a pillar of his administration and of the Revolution.

 

1. Organization of the Petroleum Exporting Countries. Venezuela facts and figures. 2019, https://www.opec.org/opec_web/en/about_us/171.htm. Accessed 28 Nov. 2019.

2. US Energy Information Administration - EIA - Independent Statistics and Analysis. Venezuela. Jan. 2019, https://www.eia.gov/beta/international/analysis.php?iso=VEN. Accessed 28 Nov. 2019.

3. Livingstone, G. (2013, March 10). The secret of Hugo Chavez's hold on his people. Retrieved March 17, 2020, from https://www.independent.co.uk/news/world/americas/the-secret-of-hugo-chavezs-hold-on-his-people-8527832.html

4. El País. (2007, January 08). Chávez anuncia la nacionalización del servicio eléctrico y las telecomunicaciones. Retrieved July 01, 2020, from https://elpais.com/internacional/2007/01/08/actualidad/1168210811_850215.html

5. The Guardian (2012, October 08). Hugo Chávez: A victory of enduring charisma and political mastery. Retrieved March 17, 2020, from https://www.theguardian.com/world/2012/oct/08/hugo-chavez-victory-political-venezuela

6. Twitter, F., & Miraflores, P. (2017, July 23). Maduro, his ministers and the corruption of language. Retrieved March 15, 2020, from https://elpais.com/elpais/2017/07/22/opinion/1500746848_239358.html

7. Grainger, S. Hugo Chávez and Venezuela Confront his Succession. Dec. 2012. https://www.bbc.com/news/world-latin-america-20678634. Accessed 29 Nov. 2019.

8. Sánchez, V. Venezuela hyperinflation hits 10 million percent. 'Shock therapy' may be only chance to undo economic damage. Aug. 2019. https://www.cnbc.com/2019/08/02/venezuela-inflation-at-10-million-percent-its-time-for-shock-therapy.html. Accessed 29 Nov. 2019.

9. TVVenezuela. The CLAP boxes no longer have anything to feed Venezuelans. https://www.youtube.com/watch?v=MelhZDbiFQQ. Sept. 2019. Accessed 30 Nov. 2019.

10. Delgado, A., & Herrero, J. (2019, February 12). Venezuela rhetorics on Twitter: Guaidó vs. Maduro. Retrieved March 18, 2020, from https://beersandpolitics.com/retoricas-de-venezuela-en-twitter-guaido-vs-maduro

Categories Global Affairs: World order, diplomacy and governance Latin America Essays

Faced with the biggest economic crisis since World War II, the EU itself has decided to borrow to help its member states.


 Commission President Von der Layen and the President of the European committee Charles Michel after announcing the agreement in July [committee European]

ANALYSIS / Pablo Gurbindo Palomo

"Deal!". With this "tweet" at 5:30 a.m. on 21 July last, the president of the European committee , Charles Michel, announced the achievement of a agreement after the longest meeting in its history (more than 90 hours of negotiations). 

framework After the failed summit in February, European countries were aware of the importance of reaching an agreement on agreement, but some countries saw it as more urgent than others to conclude the Multiannual Financial Framework (MFF) for the next seven years. But as with everything else, the Covid-19 pandemic has overturned this lack of urgency, and has even forced member states to negotiate, in addition to the budget, aid to alleviate the effects of the pandemic on the 27.

The agreement consists of an MFF of 1.074 trillion euros. This is lower than the figure demanded in February by the so-called friends of cohesion (a conglomerate of southern and eastern European countries) and the Commission itself, but also higher than the figure that the frugals (the Netherlands, Austria, Denmark and Sweden) were prepared to accept. But it is not this figure that has been the focus of the discussion, but how much and how the post-pandemic recovery fund to help the countries most affected by the pandemic was to be set up. The Fund was agreed at 750 billion, divided into 390 billion to be given to member states in the form of grants, and the remaining 360 billion to be given in the form of a 70 per cent disbursable loan between 2021 and 2022.

The figures are staggering, and based on the February negotiations, where one part of the membership preferred something more austere, one might ask: How did we arrive at this agreement?

The Hamilton moment

With the arrival of Covid-19 in Europe and a considerable paralysis of all the world's economies, the European capitals quickly realised that the blow was going to be significant and that a strong response was going to be necessary to mitigate the blow. Proposals at the European level were not long in coming. For example, the European Parliament proposed a recovery package on 15 May of 2 trillion euros, and to include this in the MFF 2021-2027.

The most prominentproposal was presented on 18 May by French President Emmanuel Macron and German Chancellor Angela Merkel. And not only because it was promoted by the two main economies of the Union, but also because of its historic content.

There has been talk of Hamilton momentHamilton moment, referring to Alexander Hamilton, one of the founding fathers of the United States and the first Secretary of the Treasury of the newly founded republic. In 1790 the thirteen states that made up the young American nation were heavily indebted due to the war effort of the Revolutionary War, which had ended only seven years earlier. To solve this problem, Hamilton, Secretary of the Treasury, succeeded in convincing the federal government to assume the states' debt by "mutualising" it. This event marked the strengthening of the American federal government and served to create the instructions of the US national identity. 

It seems that with the Franco-German proposal the Hamilton moment has arrived. The proposal is based on four pillars

  1. European health strategy, which could include a joint reservation of medical equipment and supplies, coordination in the purchase of vaccines and treatments. In turn, epidemic prevention plans shared among the 27 and common methods for registering the sick.

  2. A boost to the modernisation of European industry, supported by an acceleration of the green and digital transition.

  3. Strengthening the European industrial sector, supporting production on the Old Continent and the diversification of supply chains to reduce global dependence on the European Economics .

  4. 500 billion reconstruction fund for the regions most affected by the pandemic on the basis of EU budget programmes.

It is this fourth pillar that we can call "Hamiltonian" and which is historic as it would for the first time in history allow the EU itself to issue debt to finance this fund. This proposal has broken years of a German stance against any collective borrowing subject . "We are experiencing the biggest crisis in our history... Because of the unusual nature of the crisis we are choosing unusual solutions," Merkel said in the joint video conference with Macron.  

According to this proposal the funds would not be reimbursed directly by the countries but through the Community funds in the long term deadline, either through its usual resources or through new sources of income. It should also be noted that the proposal spoke of the submission of this fund in the form of subsidies, i.e. without any subject interest for the recipient countries.

Among the reactions to proposal were those of the frugal, who rejected that the funds should be given in the form of grants. "We will continue to show solidarity and support for the countries most affected by the coronavirus crisis, but this must be in the form of loans and not subsidies," said Austrian Chancellor Sebastian Kurz. The frugal proposal is that the financial aid raised on the debt markets should be submit to states at low interest rates, i.e. as a loan, and conditional on a reform programme.

On 27 May the Commission announced its proposalThe EU's new, very similar to the Franco-German one, but enlarged. The proposal is composed of a 1.1 trillion euro MFF and a 750 billion euro recovery plan called Next Generation EU. This recovery plan is based on three pillars financed by new instruments but within pre-existing headings:

The first pillar covers 80% of the recovery plan. It is about supporting Member States in their investments and reforms in line with the Commission's recommendations. To this end, the pillar has these instruments:

  • Recovery and Resilience Mechanism (the most important part of proposal): financial support for investments and reforms by states, especially those related to the green and digital transition and the resilience of national economies, linking them to EU priorities. This mechanism would be made up of 310 billion in grants and 250 billion in loans.

  • React-EU Fund under cohesion policy with 55 billion. 

  • Increase in the Just Transition Fund: this fund is intended to support states in undertaking the energy and ecological transition, to move towards a climate-neutral policy. It would be increased to 40 billion.

  • Increase of the European Agricultural Fund development Rural: to support rural areas to comply with the European Green agreement . It would be increased by 15 billion.

The second pillar covers 15% of the plan. It focuses on boosting private investment, and its funds would be managed by the European Investment Bank (EIB):

  • 31 billion Solvency Support Instrument

  • EU-Invest programme increased to $15.3 billion

  • New Strategic Investment Fund to promote investment in European strategic sectors 

The third pillar covers the remaining 5%. It includes investments in areas that have result been key to the coronavirus crisis:

  • EU4Health programme to strengthen health cooperation. With an budget of 9.4 billion.

  • Reinforcement of the EU Civil Protection Mechanism (EUCPF) by 2 billion.

  • project Horizon Europe for the promotion of research and innovation worth 94.4 billion.

  • Support to the external humanitarian financial aid worth 16.5 billion.

To raise the funding, the Commission would issue its own debt on the market and introduce new taxes of its own, such as a border carbon tax, emission allowances, a digital tax or a tax on large corporations.

It should also be noted that both access to MFF and Next Generation EU aid would be conditional on compliance with the rule of law. This was not to the liking of countries such as Hungary and Poland, which, among others, consider it to be unclear and a form of interference by the EU in their internal affairs.

Negotiation at the European Summit

With this proposal on the table, the heads of state and government of the 27 met on 17 July in Brussels amid great uncertainty. They did not know how long the summit would last and were pessimistic that it would be possible to reach an agreement agreement.

The main sticking points in the negotiations were the amount and form of the reconstruction fund. Countries such as Spain, Italy and Portugal wanted the aid to come in the form of subsidies in full and without any subject conditionality. On the other hand, the frugals, led during the summit by Mark Rutte of the Netherlands, wanted the reconstruction fund to be reduced as much as possible, and in any case to be given in the form of loans to refund and as an "absolute precondition". "Any financial aid from the North means reforms in the South. There is no other option", Rutte said at a press conference in The Hague.

As with all negotiations, the positions were gradually loosening. It was already clear that neither position was going to remain unscathed and that a mixed solution with both subsidies and loans was going to be the solution. But in what percentage? And with reform conditionality?

For Spain, Italy and Portugal the subsidies could not be less than 400 billion, which was already a concession from the initial 500 billion. For the frugal, who were joined by Finland, this figure could not exceed 350 billion, which would reduce the total Fund to 700 billion. This was a major concession by the frugals, who went from talking about zero subsidies to accepting them as 50% of the amount. Michel's final proposal was 390 billion in subsidies and 360 billion in loans to try to convince all sides.

The big stumbling block apart from the percentage was the conditionality of reforms for the submission aid that the frugal advocated. The spectre of the Troika imposed after the 2008 crisis was beginning to appear, to the disgrace of countries such as Spain and Italy. Rutte demanded that the national plans that countries had to present to the Commission in order to receive the Fund should also pass through committee of the 27 and that unanimous approval was necessary. This formula basically allowed any country to veto the national plans. Germany did not go as far as the required unanimity, but did ask for some control by the committee.

Rutte's stance angered many countries that saw proposal as a way of forcing reforms that have nothing to do with economic recovery.

The president of the committee presented a proposal to bring the parties closer together: the "emergency brake". According to Michel's proposal countries will have to send their reform plan to committee and it will have to be C by qualified majority. deadline After its approval, any country is allowed to submit its doubts about the fulfilment of the plans presented by a state to the committee ; in this case, the committee would have a maximum of three months to make a pronouncement. As long as the country does not receive a decision, it would not receive the aid.

For those who may be surprised by the large concessions made by the frugal, it is worth mentioning the figure of the "rebates" or compensatory cheques. These are rebates on a country's contribution to budget and were introduced in 1984 for the United Kingdom. The British were one of the main net contributors to the European budget , but they hardly benefited from its aid, 70% of which went to the Common Agricultural Policy (CAP) and the Cohesion Fund. It was therefore agreed that the British would have their contribution discounted on a permanent basis. Since then, other net contributor countries have been receiving these cheques. However, in these cases they had to be negotiated with each MFF and were partial on a specific area.

It is a very controversial figure for many countries, and an attempt was already made to remove it in 2005. But what is undeniable is that it is a great bargaining chip. From the outset, the frugal countries have wanted to keep it, and even strengthen it. And given the difficulties in negotiating, the rest of the member states have seen that it is an "affordable" and not very far-fetched way of convincing the "hawks of the north". After some initial posturing, they ended up increasing it: Denmark will receive 377 million (considerably more than the initial 222 million); Austria will double its initial amount to 565 million; Sweden will receive 1.069 billion (up from the initial 823 million); and the Netherlands will receive 1.575 billion. Notably, Germany, as the largest net contributor, will receive 3.671 billion.

The last important negotiation point to be addressed is the conditionality of compliance with the rule of law in order to receive the different funds and aid. Hungary and Poland, for example, have an open transcript for possible violation of article 7 of the Treaty on European Union (TEU), which allows a member state to be sanctioned for violating basic EU values such as respect for human rights or the rule of law. Many countries have pressed the issue, but in the face of difficult negotiations and a possible risk of a veto of agreement depending on the vocabulary used by Hungarian President Viktor Orban, this clause has come to nothing.

To recapitulate, and as stated at the beginning of article, the agreement ended up with an MFF of 1.074 trillion euros; and a post-pandemic reconstruction fund, the Next Generation EU, of 750 billion, divided into 390 billion in the form of subsidies and 360 billion in the form of loans. To this must be added Michel's "emergency brake" for the submission of aid and the significant sum of "rebates".

The cuts

Yes, there have been. Apart from the aforementioned rule of law clause, there have been several cuts in several of the items proposed by the Commission. Firstly, there has been a significant cut in the Just Transition Fund, which has been reduced from the initial 40 billion at proposal to 10 billion, to the anger of Poland in particular. Secondly, the funds for the rural development are reduced from 15 billion to 7 billion. Thirdly, both the 16.5 billion external humanitarian support fund financial aid , the 31 billion solvency support instrument (on its proposal by the Commission) and the 9.4 billion EU4Health programme have come to nothing. And finally, the project Horizon Europe would drop from the 94.4 billion proposed by the Commission to a mere 5 billion.

Winners and losers?

It is difficult to speak of winners and losers in a negotiation where all parties have given quite a lot in order to achieve agreement. Although it remains to be seen whether the countries' positions were truly immovable from the outset or whether they were simply used as an instrument of pressure in the negotiation.

The countries most affected by the pandemic, such as Italy and Spain, can be happy because they will receive a very large sum in the form of subsidies, as they wanted. But this conditionality that they were not going to accept in any way, in a way, is going to come to them softened in the form of Michel's "emergency brake". And the reforms they did not want to be forced to make, they will have to carry out from agreement with the recovery plan they send to committee, which if they are not sufficient may be rejected by the latter.  

The frugal have succeeded in getting conditional aid, but more than half of it will be in the form of subsidies. And as a rule, the monetary limits they advocated have been exceeded.

Countries such as Poland or Hungary have succeeded in making the conditionality of the rule of law ineffective in the end, but on the other hand they have received considerable cuts in funds, such as the Just Transition fund, which are important especially in Central Europe for the energy transition.

But, on final, every head of state and government has returned home claiming victory and assuring that he or she has fulfilled his or her goal, which is what a politician must do (or appear to do) at the end of the day.

For both the MFF 2021-2027 and Next Generation EU to go ahead, the European Parliament still needs to ratify it. Although the Parliament has always advocated a more ambitious package than agreed, there is no fear that it will block it.

Conclusion

As I have said, this agreement can be described as historic for several reasons. Apart from the obvious extension of the European committee or the Covid-19 pandemic itself, it is historic because of the Hamilton moment that seems to be about to take place.

Member states seem to have learned that the post-crisis formula of 2008 did not work, that crises affect the whole of the Union and that no one can be left behind. Cases such as Brexit and the rise of Eurosceptic movements across the continent set a dangerous precedent and could even endanger the continuity of project.

The "mutualisation" of debt will allow states that are already heavily indebted, and which due to their high risk premium would have problems financing themselves, to get out of the crisis sooner and better. This decision will obviously cause problems that remain to be seen, but it shows that the 27 have realised that a joint financial aid was necessary and that they cannot go to war on their own. As Merkel said when presenting her post-pandemic plan together with Macron: "This is the worst crisis in European history", adding that to emerge "stronger", it is necessary to cooperate.

This move towards a certain fiscal unity can be seen as a rapprochement to a Federal Europe, at least in the Eurozone, which has been discussed for decades now. Whether this is a path with or without return remains to be seen.

Categories Global Affairs: World order, diplomacy and governance European Union Analysis