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|European politics in 2017|
Gaiko Forum - January 2017
For day-to-day drama, the eyes of the world in 2017 will of course be focused on the new American president, at least during his early months in office. But for longer-term impact on geopolitics and the global economy, Europe will be at least as important. For European politics will be the venue in which the next phase of the global populist revolt will be played out. And Europe, along with its close neighbour Turkey, will be the region most vulnerable to political influence by terrorism.
The reason for Europe’s importance is essentially economic, but geography also comes into play. Except for the United Kingdom, Sweden and Denmark, all three of which have stayed out of the euro single currency, the advanced, developed countries of the European Union have suffered from very slow recoveries from the 2008 global financial crisis, which has left unemployment rates high and citizens frustrated.
Germany is another exception: its unemployment rate, at 4.3% of the workforce on OECD figures in December 2016, is less than half the euro-zone overall rate of 10% and well below those in France (10.1%), Italy (11.6%), Spain (19.2%) or Greece (23%). But as the chief creditor nation to the single currency’s biggest debtors, the mood in Germany has been depressed by overall euro-zone stagnation and by political divisions inside the EU over both economic policy and migration.
The geographical importance arises from the EU’s position alongside Russia, and along the northern coast of a Mediterranean Sea of which Turkey makes up the eastern coast, and Syria, Libya, Tunisia and other North African and Middle Eastern countries the southern coast. So tensions over Russia spread deeply inside European politics, as do concerns over flows of refugees and economic migrants from North Africa, over terrorism by Islamic State and its sympathisers, and the political instability of Turkey.
Finally, on top of all these geopolitical, economic and security issues there is also the issue of Brexit – the decision in last June’s referendum by the UK to become the first country ever to leave the European Union. Negotiations over the terms and speed of Brexit are expected to be launched in late March when the UK government triggers the process for leaving laid down in Article 50 of the EU’s Lisbon Treaty.
Brexit will not dominate European politics directly during 2017, even though it will naturally dominate British politics. But it will be a factor, a shadow, hanging over all the other issues in European politics and governance, including the completion of the Japan-EU Economic Partnership Agreement but also migration, relations with Russia, economic policy and more.
The central, dominating issue in European politics, at least in the first half of the year will not be Brexit, nor Germany, nor Russia, but France. By which I mean that the decisive event, which all other governments will be waiting for, will be the French Presidential and Parliamentary elections that take place in April, May and June.
This will take Europe back, in some senses, to the era of General Charles de Gaulle, France’s wartime leader in exile and later its president. He always felt that France must play a central role in Europe. De Gaulle wasn’t really a collaborative believer in European solidarity. After all, he notoriously held the young European Community to ransom in the mid-1960s by boycotting meetings in order to foster his own vision of an intergovernmental, rather than supranational, Europe. He was what Donald Trump might call a “France Firster”. But still, he wanted Europe to make France more powerful in the world, which is about to happen, again.
One reason is well known: the possibility, shocking even that it can be called a possibility, that the Front National’s Marine Le Pen could be elected president in May. Who hasn’t heard the gloomy, speculative logic? That after Brexit and Trump, the next blow to rational predictions and conventional wisdom, the next victory of populism, must be President Le Pen?
If that were to happen, the European Union would be for the scrapheap. Unlike Trump, Ms Le Pen has been in politics for 20 years already and her policy positions have a consistency that means they have to be taken seriously: she would want France to rebuild trade barriers, leave the euro and restrict immigration tightly, none of it compatible with the EU as we know it. And she really means it. The process of breaking up the EU, begun in a smaller way by the Brexit vote in 2016, would start in earnest if she were to win.
Is this actually going to happen? The French electoral system makes it difficult, but not impossible. The president is elected in two rounds of voting: after the first, in late April, if no single candidate holds more than 50% of the vote, then the two leading candidates have to compete in a second round of voting, in early May.
Current opinion polls indicate that it is impossible for any candidate to win in the first round. But they further indicate that Ms Le Pen will most probably be one of the two candidates competing in the second round. The key question is whether voters who have supported unsuccessful mainstream candidates in the first round will then rally around whoever is competing with Ms Le Pen, as happened when her father, Jean-Marie Le Pen, reached the second round of the presidential vote in 2001, or whether enough might choose her that she could actually win. This is not thought likely – but neither was the victory of Donald Trump.
The result is that there is no point in any EU country – Britain negotiating Brexit, Italy contemplating a general election – taking serious action until after the second round of France’s presidential poll has taken place on May 7th. The result is simply too important for all of us. But it is important also for another reason, beyond fear of a President Le Pen.
The French election will be influential also in the likelier case that Ms Le Pen loses. In its 60 years of existence, the European Union has never made progress, never been able to act credibly and decisively, except when the governments of France and Germany have thought together, planned together and worked together. During the five-year term of President Francois Hollande, this Franco-German motor has ground to a halt. Neither side trusts the other, and the Germans think President Hollande is weak and incapable.
Without that Franco-German motor, management of Europe’s multiple crises has been disastrously slow, ineffective and divisive. Yet the interests of France and Germany are shared: the Berlin killings on December 19th, just over a year since the Bataclan massacre and five months on from an identical truck attack in Nice, showed that the two countries face the same terrorist threat; having conceived the euro together when Presidents Kohl and Mitterrand were in full co-operation during the 1990s, they share a deep interest in making the currency system work; and with America potentially turning hostile to Europe under President Trump, they need each other more than ever in geopolitics.
If the much likelier outcome of France’s presidential election in May occurs, namely a victory for the centre-right candidate Francois Fillon, the stage would be set for a new era of Franco-German collaboration. Fillon, who is an economic liberaliser but a social conservative, is far more compatible with Chancellor Angela Merkel and especially with her Christian Democrat and Christian Social Union party supporters, than has been President Hollande. He would even stand a chance of convincing Merkel and the German parliament to relax the tight fiscal constraints that have been holding euro-zone economies back.
The one shadow over this probable Franco-German rapprochement is Russia. While Chancellor Merkel has led the EU’s policy of sanctions against Russia following its annexation of Crimea and support for the war in Ukraine, Mr Fillon has spoken in favour of closer, friendlier relations with Russia. This may not be a policy he will stick to if he becomes president. But it is a potential source of division – unless President Trump has already led the way in abandoning sanctions on Russia by the time Mr Fillon is elected.
Another complicating factor could be Turkey. French policy towards Turkey and its candidacy to join the EU has been more hostile and negative than German policy. Chancellor Merkel led the way in negotiating a multi-billion euro deal with Turkey to try to stop the flow of refugees from Syria through Turkey into the Balkans. But the crackdown by Turkey’s government on dissent and opposition since a failed military coup last July, and now exacerbated by Islamic State terrorism in Istanbul, could increase French suspicion of Turkey and its human rights record.
Nevertheless, despite all those caveats, the chance is there and is good that after the French election a far better Franco-German relationship will be able to re-emerge. Its full benefit may not be seen until Germany itself has its general election in September, when Mrs Merkel will be competing for her fourth term in office. But after then, there is a chance that the EU could genuinely begin to move in a more positive and constructive direction.
The key dangers surrounding this hope, in France as in the Netherlands, which has a general election in March, and in Italy, whenever its election takes place, arise from the combination of high unemployment, stagnant household incomes and fear of immigration. The latter issue is also a danger for Mrs Merkel in the German election.
Hillary Clinton’s problem was that she represented too closely the American establishment that had brought the 2008 financial crash and then had failed to oversee an equitable recovery from it. Brexit is a very different case, given Britain’s long history of semi-detachment from Europe, but it still can be explained by alienation from the powers-that-be, which crucially included a Europe that, thanks to the loss of the Franco-German motor, now looked like a problem rather than any sort of a solution.
To win the argument during 2017, political parties and intellectuals that favour open, liberal societies and European collaboration will have to show that they offer more hope for the future of citizens of all ages than do the advocates of closure and of rejecting Europe, such as Le Pen and the Netherlands’ Geert Wilders.
That means that they will need to convince voters that they can make Europe work again, make it part of the solution for national ailments rather than a problem in itself. Above all, however, they will need to convince voters that they can restore national economic dynamism, removing obstacles to growth and to the creation of jobs.
Francois Fillon is a good person to lead this argument, since he is capable of appealing both to young voters who want jobs and opportunities and to older voters worried about traditional French values. Both the other two mainstream candidates, Manuel Valls of the left and Emmanuel Macron as an independent, also have the chance to inspire the young, though as former members of President Hollande’s administration they are also tainted by recent failure.
Mrs Merkel herself will gain more confidence in making this argument in her September election if either Mr Fillon or Mr Valls – but preferably her fellow centre-right political leader, Fillon – is by then France’s president.
The stakes, for Europe and for the world, could not be higher.