Macron, bitter after his unsuccessful visit to Washington, decided it was time to get down to business with Russia, which holds the keys to many of the major issues of our days: the Syrian civil war, the tension between Israel and Iran, the Ukrainian quagmire, energy prices and supplies, Siberian natural gas, and the global balance of power.

 

On the occasion of the 22nd Saint Petersburg Economic Summit this last May, French President Emmanuel Macron and his wife Brigitte were greeted by Vladimir Putin under a sunny Baltic sky on the terrace of the Konstantinosvky Palace, the summer residence of the Russian head of state.

The historically erudite Macron could not fail to revel in the verdant panorama of manicured lawns and topiary yews spreading to the Gulf of Finland at the foot of the Versaillesque building erected by French architect Leblond in the early 18th century. The self-styled “Jupiterian” national leader, whose popularity is waning in France as fast as Russian snow in the bright May sunshine, found in this Olympian former haven of the czars the appearance of imperial and geometric serenity and order that much of the world so badly lacks.

The contrast between outspokenly sovereign and centralised Russia, headed by a phlegmatic and relaxed Vladimir Putin, and the cantankerous disarray in the European Union is stark. Is there after all some virtue in independent statehood unencumbered by the myriad ties of economic, strategic and monetary alliances and pacts? Donald Trump in the United States certainly believes it and he has a lot of support at home for his drive to break away from as many international agreements as possible, regardless of whether the new American isolationism leaves other countries in the lurch. As for Europe, no day passes without new expert forecasts of the incipient collapse of the euro and the breakup of the uncomfortable Union.

After putting Greece under the tutelage of international financial institutions, the EU just moved to prevent a democratically victorious anti-euro anti-establishment coalition from forming a government in Rome, by backing the Italian President’s decision to appoint a former banker to head a caretaker administration pending new elections. Eventually, in the face of massive discontent in the Italian population, the EU Commission backed down and the Italian head of state relented against the promise that the new government would not take the nation out of the euro. The situation looks bad when keeping a tottering quasi-confederacy together requires an undisguised “guided democracy”, in which only mainstream “centrist” pro-EU parties are welcomed by the unelected supra-national authorities.

The great problem of the European Union is that it is a halfway-house, in which nation-states are still officially independent, although they are, in effect, deprived of critical aspects of sovereignty by the Brussels bureaucratic super-state. The French President’s project to strengthen the Union seems to be a non-starter, given Germany’s reluctance to subordinate its own domestic policies to a transnational authority, although it readily leans on fellow EU-members to implement rules approved by Berlin.

The discussions between Putin and Macron in Saint Petersburg were wide ranging and what remains confidential is certainly more important than what was publicly said. Faced with a rapidly changing world, buffeted by headwinds at home and worried about the shambolic policies of the US, in which the dominant news are about school shootings, police brutality, Presidential lies, reciprocal charges of corruption, espionage, foreign collusion and obstruction of justice at the highest level, European statesmen are forced to rethink their national priorities. Watching German Chancellor Angela Merkel pay two visits in quick succession to Sochi to meet with Putin, Macron, bitter after his unsuccessful visit to Washington, decided it was time to get down to business with Russia, which holds the keys to many of the major issues of our days: the Syrian civil war, the tension between Israel and Iran, the Ukrainian quagmire, energy prices and supplies, Siberian natural gas, the Arctic sea route, the Eurasian Sino-Russian Belt and Roads and the global balance of power. Seen as an almost anti-Russian candidate during his electoral campaign, the French President realised that his attempts to draw close to Trump brought no benefits and that a reset was in order.

It stands to reason that the perpendicular axes of discussion between the two heads of state were international security and the economy. Decision-makers are aware that the Trump administration prides itself on taking no notice of international law. Trump seemingly never heard of it and his current National Security Adviser John Bolton is an expert on the theory that it is irrelevant to the United States, powerful enough to set and enforce rules for everyone else. America no longer regards itself bound to support allies unless it finds it in its national interest, but still expects other countries to contribute to its military enterprises and commitments insofar as they are economically or strategically dependent on the US.

Regarding trade, Trump’s priority is to reduce and eventually eliminate his country’s trade deficit, be it with China, Japan, Mexico, the EU or India, by slapping import duties and tariffs and strong-arming the surplus exporting partners into purchasing more US goods and services. The US continues to foreclose other large markets such as Russia and Iran to competitors through unilateral sanctions. From Beijing the US demands first preference for its agricultural exports over cheaper producers and more investments (although not in areas regarded as strategic by Washington). Free trade is thus being replaced by what Washington regards as “fair trade”—for itself. The victims in this new regime will be all those who will pay more to buy US goods or who will lose access to capital now increasingly pulled into the American economy.

Europe, South America, Japan, South Korea and others may find it more difficult to sell and buy agricultural and industrial products among themselves if the US leverages its financial and military might to secure priority access to the more important markets and in the process overrules both the WTO and regional trade pacts.

The Europeans and, on the other end of Asia, the Japanese whose Premier Shinzo Abe was also a guest at the SPIEF, are waking up to that threat to their prosperity. Putin was quick to point out that Europe had lost half of its business in Russia, to the tune of hundreds of billions since the sanctions were adopted in connection with the Ukrainian crisis, while French companies have had to pay tens of billions to the US Treasury as compensation for violating unilateral US sanctions on third countries. With a deadpan face he even told Macron that Russia was ready to provide security assistance to Europe to replace the leaky and windblown NATO umbrella. There are reasons to believe that this offer was not taken lightly and that France and Germany have begun to discuss a Eurasian realignment just about when India is also revamping her relations with Russia and Iran and opening a new phase of dialogue and selective collaboration with China. A transition towards the formation of a Eurasian economic cooperation bloc, which I anticipated more than ten years ago (World Affairs Jan-March 2004 et passim) should take a long time, given the difficulties in loosening the transatlantic alliance through which Washington controls many of the levers of power in Europe. It may only happen if the Eurozone continues to crack at the seams. Countries whose populations are calling for expanded economic relations with Russia and Iran (including Germany, France and Italy as well as Greece, the Czech and Slovak Republics, Hungary, Austria et al.) are becoming increasingly eurosceptical under the current EU regime and the trend for a “Eurasian Common Home” is likely to grow stronger as most of those states see a need to resist self-serving American policies hostile to their respective interests.

Two effects of the ongoing evolution are to be seen in the rapid rapprochement between the two Koreas, whereas Washington is being pushed to the side despite the White House’s attempt to remain the kingmaker, and the implicit British reset on Brexit. Increasingly worried about the possibility of a Paris-Berlin-Moscow compact reforming, as it did in 2003 under Presidents Chirac and Putin and Chancellor Schroeder, Westminster is now quietly working to dilute the terms of its divorce so as it to remain in the European decision-making bodies without being “of Europe”, which is the age-old British imperial position or desideratum. A major concern in Anglo-American ruling circles is to maintain any present and future European politico-economic structures under the sway of NATO and for that the new Cold War is a useful if not a necessary stratagem.

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