“We Are Essentially At War” Ukraine Admits, After Dozens Killed

 

 

Odessa Massacre

First published on 05/03/14

While there may be some confusion about why massive bond buying greeted yesterday’s “better than expected” loss of 209 jobs in the 25-54 age group, dragging stocks down, the answer is actually very simple: there is a war in the Ukraine.

A war which just took a turn for the worst after at least 42 people were killed according to Reuters in street battles between supporters and opponents of Russia in southern Ukraine that ended with dozens of pro-Russian protesters incinerated in a burning building. The riot in the Black Sea port of Odessa, ending in a deadly blaze in a besieged trade union building, was by far the worst incident in Ukraine since a February uprising that ended with a pro-Russian president fleeing the country.

The clip below, not for the faint of heart, shows anti-government protesters jumping from the burning Odessa trade unions house: it appears when Yanukovich was “killing” protesters in February, the west couldn’t get up in arms fast enough screaming for the former president’s overthrow. But now that the acting post-CIA funded coup government is doing the same thing to its own protesters, the radio silence is stunning.

Shocking Odessa video: Trapped people jump out of burning building

 

 

But while these tragic events in Odessa were the first time the Ukraine conflict manifested itself in pro and anti-Russian clashes in the Black Sea town, it will hardly be the last: not only does the port city have economic and military significance, it also sits between Crimea and pro-Russian areas in eastern Ukraine and the breakaway Transnistria region of neighboring Moldova.

The admission of the true state of affairs finally came from Kiev itself which said that Ukrainian forces pressed their assault on separatists today, freeing up a regional airport as the head of the country’s anti-terrorist center warned eastern regions are “essentially” at war.

The campaign in the Donetsk region left five dead from the Ukrainian anti-terrorist operation and 12 wounded, said the center’s chief, Vasyl Krutov, at a Kiev briefing, even as military observers were freed by anti-Kiev militants. Government forces have secured the town of Slovyansk as operations in Kramatorsk continue.

“What is happening in the east is not a short-term action, this is essentially a war,” Krutov said today.

War it is:

 Open clashes are sweeping Ukraine’s east, from Donetsk near the Russian border to Odessa, about 100 miles from the European Union’s southeastern frontier in Romania, amid signs the industrial and coastal regions are slipping out of the Kiev government’s control. The U.S. and the European Union accuse Russia of being behind the unrest, while Russian President Vladimir Putin is “extremely concerned” and is studying the situation, his spokesman Dmitry Peskov, said today.

There was some good news: military observers from the Organization for Security and Cooperation in Europe who were taken hostage a week ago were freed and will be delivered to the Council of Europe in Slovyansk near Donetsk, the council said today in a statement.

Bloomberg reports further that the U.S. and EU accuse Russia of stirring unrest to undermine Ukraine’s May 25 presidential election. Polish Prime Minister Donald Tusk said at a briefing today in Jezioro, Poland, that officials are “losing hope” about a diplomatic solution to end the crisis.

This is a war of maybe a different kind, it is a war that’s undeclared,” Tusk was quoted as saying by PAP newswire at a media briefing. “But what we’re really dealing with is de-facto a war. You can clearly see that actions taken by the international community haven’t brought results.”

To be sure, Ukraine and NATO is putting all the blame on Russia – not only for instigating the conflict but arming the separatists, seemingly oblivious of factual evidence that it was the US that was doing precisely the same just over three months ago when it was orchestarting the overthrow of the then government.

Ukraine’s Defense Ministry said the use of advanced weapons showed the separatists were “professional saboteur groups” rather than peaceful protesters. In a statement, it called their tactics “characteristic of foreign military or mercenaries.”

 

Turmoil erupted yesterday in Odessa, where more than 130 people had been detained by police, with 10 criminal cases already started, according to Petro Lutsyuk, the head of the Interior Ministry’s directorate in the city, said on the agency’s website. The Interior Ministry later said on its website that Lutsyuk was fired.

 

The nearby city of Nikolaev hosts much of the country’s defense and shipbuilding industry, as well as Zorya-Mashproekt, a state enterprise that manufactures gas turbines for OAO Gazprom (GAZP), the Russian natural gas producer and exporter.

Meanwhile, the theater by western leaders hit a new peak yesterday when Obama and Merkel did all they could: threaten more sanctions. At their news conference in Washington, Obama and Merkel said Russia must pull back support for the separatists so Ukraine’s May 25 presidential election can go ahead unimpeded. If the vote can’t be held, “we will not have a choice but to move forward” with more sanctions, Obama said. Merkel called the election “crucial” and said she’s ready to support economic sanctions if needed.

Ironically, it is German commercial interests which as we said back in March, are doing all they can to prevent sanctions of Russia as they know well they would be the biggest losers. Germany is Europe’s largest economy and had $127 billion in trade with Russia in 2013, according to the International Monetary Fund, making Germany is Russia’s second-biggest trading partner. Putin has threatened to escalate economic warfare if further sanctions are imposed.

“When we will reach a particular tipping point is very hard to say in advance,” Merkel said. “But all I can say is that the elections on May 25 are a decisive juncture for me and if there is further destabilization, things will get more and more difficult.”

Expect more furious bluster out of Germany and Obama, hoping that verbal escalation will finally cause Putin to pull back. It won’t. Meanwhile Putin is keeping quiet. Which is the second good news because as we showed yesterday, all Putin has to do is give the command.

As EU Becomes Pariah, Iceland Dropping Membership Bid

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First published online Tuesday, 13 January 2015

Written by Alex Newman

1f0c12f0f9749de5c831973ee1b3bc5d_MWith the European Union becoming increasingly unpopular across the continent amid a rapid plunge in what little public support ever existed for the unaccountable super-state seeking to become an all-powerful federal regime, authorities in Iceland announced last week that they planned to back out of membership talks and preserve what remains of their tiny island nation’s sovereignty. EU critics, who have been soaring in the polls, celebrated the news.

In a recent interview with a national radio broadcaster, Icelandic Prime Minister Sigmundur Davíð Gunnlaugsson, elected in 2013 on what has been widely described as a “centrist” platform, declared that all previous work on joining the controversial EU was “obsolete” and “not valid anymore.” He also suggested that Parliament would vote soon on a measure to officially withdraw Iceland’s membership application.

“Participating in EU talks isn’t really valid anymore, both due to changes in the European Union, and because it’s not in line with the policies of the ruling government to accept everything that the last government was willing to accept,” Sigmundur Davíð was quoted as saying during the radio interview by the Reykjavík Grapevine, sparking headlines worldwide.

“Because of that, we’re back at square one,” continued the Icelandic prime minister, whose Progress Party governs the estimated 325,000 Icelanders in an alliance with the conservative-leaning Independence Party. “All the work on it that had been carried out before is in fact obsolete.”

Icelandic Foreign Minister Gunnar Bragi Sveinsson reportedly applauded the prime minister’s announcement and the decision to back out. According to media reports, Sveinsson also said he wanted the EU membership issue to be closed as soon as possible — and that Iceland should not join.

Critics of the EU reacted with glee to the news, while proponents of smashing national sovereignty and crushing self-government were left fuming. UK Independence Party (UKIP) chief Nigel Farage, whose anti-EU party dominated elections to the EU’s pseudo-Parliament last year on a platform of secession for Britain from the bloc, was among those who celebrated the Icelandic leader’s comments.

“This move by Icelandic authorities and the increasing Mediterranean opposition to the EU shows that the idea of the inevitability of EU integration has been smashed,” declared Farage, who also co-chairs an anti-EU political alliance in what passes as the Brussels-based super-state’s legislature. “More and more people throughout Europe either no longer wish to join the EU or, as in Greece, to leave the euro currency altogether.” Elections and surveys across the bloc show the EU is now deeply unpopular.

Blasting the super-state’s embattled single currency known as the euro, Farage also said the rapid rebound in Iceland’s economy following the global economic crisis could be attributed to the fact that, unlike many formerly sovereign European nations, it still retains its own currency. “Greece and other Mediterranean countries are caught inside the straitjacket of an unsuitable euro currency and unsympathetic political union dominated by Germany,” he continued, saying other nations should be encouraged by Iceland’s example and that Greece ought to ditch the euro to restore prosperity.

The previous Icelandic government, run by a coalition of leftist Social Democrats and radical Left-Greens, formally applied for EU membership in 2009 amid the economic crisis that hit Iceland especially hard. By early 2010, the European Commission, a hybrid legislative-executive branch run by unelected and unaccountable bureaucrats, responded favorably. Accession negotiations began shortly after that.

When the new prime minister and his coalition were elected in 2013, though, they promptly froze the discussions indefinitely. Especially problematic for Iceland, with an economy heavily reliant on its fishing industry, were EU-imposed “quotas” on how many fish can be caught.

Last year, the newly elected “center-right” government even floated a measure to abandon EU negotiations and formally withdraw its application to surrender what remains of national sovereignty and self-government. The effort was met with AstroTurf protests demanding a “referendum” on joining the EU.  

According to polls taken at that time, most Icelanders supported voting on the issue. However, the same surveys revealed that almost half of the nation’s voters would vote against the EU, while just over a third supported joining. The rest were undecided.

Ironically, pro-EU apparatchiks — after brazenly bulldozing over the wishes of voters in nation after nation that voted against expanding and empowering the controversial continental regime — suddenly displayed a newfound passion for referendums. In interviews with the Sputnik news agency, the Kremlin’s latest foray into the media world, various Icelandic EU supporters blasted the ruling alliance’s efforts to preserve national sovereignty.

Social Democratic lawmaker Össur Skarphéðinsson, for instance, Iceland’s foreign minister when the application to join the EU was fist submitted, lambasted the prime minister for not concluding negotiations with Brussels and then asking voters whether to join the super-state. “I think it is wise for Iceland to become a member of the large currency union,” Össur added, brushing aside concerns about the ongoing troubles facing the controversial single currency. “It is a security issue.”

In a separate Sputnik article aimed at salvaging efforts to quash Icelandic sovereignty, another lawmaker, Guðmundur Steingrímsson, who chairs Iceland’s Bright Future party, also blasted the ruling alliance over its decision. “I strongly oppose this move,” he said, referring to the government’s efforts to back out of membership talks. “I strongly believe that Iceland would benefit, with a good agreement, from EU membership.” Guðmundur also said negotiations should be concluded and then voters should decide in a referendum.

In the EU, however, referendums do not have the same meaning generally associated with the term around the world. When French and Dutch voters decided overwhelmingly not to shackle themselves to the draconian EU “Constitution,” for example, so-called “eurocrats” changed its name to the “Lisbon Treaty” and imposed it anyway. When Irish voters said no, they were bullied and threatened into holding another election and eventually voting yes. In Croatia, tax money and threats to pensions were used to terrorize voters into submission.

The vast majority of Europeans never even had a chance to vote on the scheme. The Swiss, meanwhile, despite voting overwhelmingly to remain independent, are regularly terrorized by the super-state to change their policies — sometimes after referendums. The EU continues to bully tiny Switzerland over everything from immigration to low taxes, and the Alpine nation is not even a member.

Today, the vast majority of “laws” imposed on around 500 million Europeans emanate from Brussels rather than national capitals, which have essentially become vassals of the EU bureaucrats who now rule the continent with an iron fist. Numerous top European politicians and even a former Soviet dictator have stated that the perpetually expanding super-state is moving quickly in the direction of the mass-murdering regime ruling the Soviet Union.

Of course, Iceland’s government is still a party to various sovereignty-usurping European regimes including the European Economic Area (EEA), the European Free Trade Association (EFTA), the visa-free travel Schengen area, and NATO. Because of its membership in the EEA, many of the radical decrees issued by the legions of Brussels bureaucrats are already imposed on Icelanders without their consent.

Aside from the fishing catch quotas and other draconian policies that would be imposed on the people of Iceland by unelected bureaucrats in faraway Brussels, Icelanders’ nerves are still raw following a vicious campaign by the EU to shackle taxpayers to unfathomable levels of debt. In the end, though, Iceland won.

In early 2013, Icelandic taxpayers secured their major victory against the EU and the European banking establishment, which sought to terrorize national authorities into foisting the wild debts of a failed private bank onto the backs of innocent Icelanders. After years of battling the super-state, an obscure European court ruled against the EU and said taxpayers had no obligation to cover the bank’s debt. Over nine out of 10 voters had previously rejected paying off the private bank’s debts in referendums.

Rather than surrendering what remains of their national sovereignty and self-government to out-of-control bureaucrats with an insatiable appetite for power located thousands of miles away, the people of Iceland would be much better served by withdrawing from existing sovereignty-crushing schemes such as the EEA. Of course, Brussels will shriek and threaten the tiny nation with loss of access to the market and more. But as the EU becomes increasingly authoritarian and openly boasts of plans to become an all-powerful federal regime, preserving self-government is now more important than ever.

 

Alex Newman, a foreign correspondent for The New American, is normally based in Europe.

Angela’s Ashes: How Merkel Failed Greece and Europe – By Spiegel Online International

German chancellor Angela Merkel leaves after a session at the Bundestag lower house of parliament on the Greek crisis on July 1, 2015 in Berlin. German Chancellor Angela Merkel said that "the future of Europe is not at stake" because of the crisis over Greece after the breakdown of debt talks and expiry of its aid programme. AFP PHOTO / ODD ANDERSEN

German chancellor Angela Merkel leaves after a session at the Bundestag lower house of parliament on the Greek crisis on July 1, 2015 in Berlin. German Chancellor Angela Merkel said that “the future of Europe is not at stake” because of the crisis over Greece after the breakdown of debt talks and expiry of its aid programme. AFP PHOTO / ODD ANDERSEN

Angela Merkel relishes her reputation as queen of Europe. But she hasn’t learned how to use her power, instead allowing a bad situation to heat up to the boiling point. Her inability to take unpopular stances badly exacerbated the Greek crisis.

By Peter Müller and René Pfister

July 03, 2015 – 08:17 PM

Angela Merkel was already leaving for the weekend when she received the call that would change everything. The chancellor had just had a grueling day, spending all of it in meetings with Greek Prime Minister Alexis Tsipras — sometimes as part of a larger group, and others with only him and French President François Hollande.

They discussed debt restructuring and billions of euros in additional investments. When it comes to issues important to him, Tsipras can be exhaustingly stubborn. In the end, though, Merkel was left with the feeling the EU summit was the milestone that could quite possibly mark a turn for the better.

Martin Schulz, president of the European Parliament, had pulled Merkel aside in Brussels and whispered to her that Tsipras was seeking allies in the opposition, with whom he could push a reform program through Greek parliament even without the consent of the radical wing of Syriza, if necessary. “Can you help me?” Tsipras had asked Schulz. Schulz has good connections in the Social Democratic PASOK Party.

But when Merkel returned to Berlin, she received a call from Tsipras. He told her that he was not interested in a deal, but that he intended to hold a referendum in Greece first. A short time later, he tweeted: “With a clear ‘NO,’ we send a message that Greece is not going to surrender.”

Merkel is known for not being easily fazed. She has made it this far in part because she has firm control of her emotions. And she remained silent throughout the weekend. But at a Monday meeting of leading members of her Christian Democratic Union (CDU), she hinted at the depth of her disappointment in Tsipras. His policies are “hard and ideological,” she said, adding that he is steering his country into a brick wall “with his eyes wide open.”

Merkel had always described Tsipras as a man who, while leading a crazy organization, was quite open and accommodating in person. She had hoped that Tsipras would ultimately help reason prevail. Now, though, it appears that he has handed Merkel the greatest debacle of her tenure as chancellor.

‘Nothing Left to Fear’

In the end, of course, it will primarily be the fault of the radical Greek government if the country is ejected from the euro zone. How should one deal with a prime minister who conducts negotiations using the language of military mobilization? “We have justice on our side. If we can overcome fear, then there is nothing left to fear,” Tsipras tweeted on Monday.

But the divide that is now opening up in Europe also has something to do with Merkel’s leadership style — and with her idiosyncrasy of allowing things to drift for extended periods. This method works when it comes to negotiating a compromise, and when everyone involved is interested in a favorable outcome. But it reaches its limits when someone like Tsipras is determined to carry things to the extreme.

It has long been clear that Greece is a special case in the context of the euro crisis. It is a country in which neither the taxation system nor the land registry system works, a country that is so deeply in debt that no reasonable economist still believes that it can ever repay what it owes. In addition, parties that habitually plundered the state ran the country for years. Then came Syriza, a movement that, at least in its radical quarters, dreamed of toppling the system.

Merkel knew all of this. Nevertheless, she tried to fix the problem with recipes she had used in German domestic politics: delaying, hiding and allowing things to remain vague. There was no lack of cautionary voices. Finance Minister Wolfgang Schäuble has long argued that Greece should be taken on an orderly path out of the euro.

Merkel hopes that the Greeks will vote against Tsipras and in favor of their creditors’ austerity proposals on Sunday. If that happens, the Greek prime minister will hardly be able to remain in office. But even so, Greece will remain a bankrupt country and would be faced with forming a new government in the midst of chaos.

The Greek crisis required leadership and a plan, but Merkel was unwilling to provide either. Although she likes power, when push comes to shove, she doesn’t know what to do with it. And now she faces the wreckage of her European policy. How could things have come to this?

McKinsey Policies

To understand Merkel’s policies, it is worth turning back the clock to 2003. She had only been head of her party for three years and was in the midst of writing a new agenda for the CDU. There were four-and-a-half million unemployed in Germany, social security coffers were empty and employers were groaning about an excessively high tax burden. Germany wasn’t nearly as badly off as Greece is today, but it was in urgent need of restructuring, and Merkel began to prescribe a strict reform program for the country. The McKinsey management-consulting firm provided the numbers to support her bitter message of austerity.

McKinsey specializes in delivering unpleasant truths and is normally hired by companies that need to cut costs and lay off employees. It is easier for managers if they are able to hide behind the consultants’ analyses. That’s the McKinsey principle.

Merkel applied the principle to politics. When the euro crisis erupted in 2010, she made sure that the International Monetary Fund (IMF) was involved in Greece’s restructuring. She did so against the will of Finance Minister Schäuble, who believed that Europe should solve its own problems.

In a sense, the International Monetary Fund is the McKinsey of global politics. It helps out wherever countries face financial difficulties, granting loans if countries agree to enact reforms in return.

Reintroducing Mathematics

The idea made sense at first. One reason Europe had slid into the crisis was that the Continent, amid the euphoria of integration, had paid little attention to numbers. Former Chancellor Helmut Kohl introduced the euro, but in doing so, he paid too much attention to his emotions and not enough to economic realities. The purpose of bringing in the IMF was to reintroduce mathematics to the equation.

But the McKinsey principle conflicts with Merkel’s claim to power. Her advisers like to portray the chancellor as the queen of Europe, as someone who shapes its guidelines. But in recent months, she has come across as a woman who is hiding behind the advice and recommendations of IMF experts — behind the “technocrats,” as Tsipras puts it.

In this sense, the struggle between Merkel and the Greek premier is also a battle over the definition of the political. Tsipras has turned the IMF into a symbol of oppression, into a group of technocrats who lack democratic legitimacy and yet are subjugating an entire country. He knew how to stylize resistance to the IMF into a battle over a nation’s self-determination. His aim was to elevate the conversations to the political level.

For Tsipras, politics is a magic wand that can make everything disappear: mountains of debt, reform requirements and the rule that prohibits the European Central Bank (ECB) from keeping countries liquid by printing money. It is hard to say what Syriza actually wants. The party is as much a home to former Maoists as it is to disillusioned social democrats. Some dream of a revolution, while others would be satisfied with debt forgiveness. But one thing is clear: Tsipras’ radicalism lies in his faith in the power of the decision. If he doesn’t accept rules, he demands that they be dissolved. This is the logic of Syriza.

Merkel’s real failure is that she did not decisively stand up to his way of thinking. First, she hid behind the troika, because she didn’t want to be the one to deliver the bitter truths to the Greek government. She followed the McKinsey principle.

Then, when Tsipras’ demands became more and more urgent, she bowed to his logic. She adopted the motto: “Where there’s a will, there’s a way.” In Germany, these words were interpreted as a sign of goodwill — of the desire to keep Greece in the euro zone. But Tsipras interpreted them completely differently: as a challenge to bring matters to a head.

Merkel’s Europe

Last Monday, Merkel stood in front of a blue screen in the lobby of the Chancellery and uttered a sentence that typifies her European policy. She was discussing the question of whether a “no” vote by the Greeks to the creditors’ reform program was tantamount to a “no” to the euro. Instead of saying “yes” or “no,” she said: “I will say quite openly: I am divided on this issue.”

One cannot accuse Merkel of not having principles when it comes to foreign policy. Her fidelity to the US is unbreakable, a fact that the NSA’s surveillance of her mobile phone and of several German ministries has done nothing to change. She stands firmly behind Israel, even if the current government has done nothing to establish peace with the Palestinians. And in the end, she has managed to get along with every French president who has crossed her path, even with François Hollande, who campaigned against the German chancellor and her austerity policies.

Her position on Europe, however, is less clear. On the one hand, there is the Merkel of numbers. When she travels the world, to China or Indonesia, for example, she always has all the tables and diagrams at hand to show the great effort such countries are making and how good Europe has it with its prosperity. A typical Merkel triplet goes as follows: Europe contains just 7 percent of the global population and is responsible for just 25 percent of global economic output, but pays half of all global social welfare. From her perspective, a high school diploma isn’t necessary to realize that such a situation cannot continue forever.

On the other hand, she has learned over the years that it doesn’t come across well when she only casts a cold economic eye on Europe. It seems unfriendly. That helps explain why Tsipras was able to cast her as the villain — as the German dominatrix of austerity — because she was constantly talking about amortization and interest rates. In addition, she is the head of a party that pushed harder than any other for European integration and didn’t focus exclusively on money. She knows that she cannot simply ignore that tradition — which is why she sometimes has to slip into the role of the convinced European.

Just how divided Merkel is can also be seen by looking at her advisors. Chancellery head Peter Altmaier is a portly, unruffled man from the state of Saarbrücken near the French border. Prior to becoming involved in German politics, he worked for the European Commission and speaks fluent English, Dutch and French. In the past several months, Altmaier has done his part to ensure that Merkel remain committed to Greece, arguing that the European idea would be damaged were the community to allow a country to fall out. His answer to the crisis is: more Europe.

No Illusions

On the other side is Nikolaus Meyer-Landrut, who has led the Chancellery’s Europe department for several years. He is a wiry bureaucrat with a sharp tongue, but not without humor. Meyer-Landrut’s view of Europe and its problems is free of emotion. He is the one who provides Merkel with all the numbers that show why progress isn’t being made in Greece. His answer to the crisis is: nation states need to take control.

Numbers-Merkel has no illusions about Greece. She doesn’t believe the political classes in Athens will be able to get the country on the right track. Once, during a flight she was suddenly gripped by a laughing fit. She said that the Greek government was refusing to pay the bill for German submarines it had purchased. Their justification was that the subs were crooked. “Crooked!” Merkel said as tears of hilarity rolled down her cheeks.

In October 2012, she visited then-Greek Prime Minister Antonis Samaras in Athens. She didn’t have much respect for Samaras, who had won as head of the conservative party Nea Dimokratia by running against the reform program demanded by Greece’s creditors. Once he got into office though, he buckled — but as has so often been the case, his pledges to Brussels were never fulfilled.

On the return flight to Berlin, a bemused Merkel told of a boast Samaras had made in an interview — that his ministers could reach him on weekends as well. The moral of the story was clear for her: How can a country move forward when its leader sees something so banal as an act of heroism?

Back in 2012, Merkel was close to pushing Greece out of the euro, but she balked in the end. She was afraid that it could have a similar effect as the Lehman bankruptcy did in 2008. That was the spark that ignited the global financial crisis.

A Policy of Pedagogical Imperialism

Since then, the chancellor has gone back and forth. Sometimes she is Numbers-Merkel and sometimes she is Europe-Merkel. Numbers-Merkel sees the Grexit as the most reasonable solution. But Europe-Merkel is concerned about being seen as the EU’s grave-digger should she let Greece fall. There are decent arguments on both sides, but Merkel never made up her mind. She left things open.

The euro crisis opened up a new dimension of power for Merkel. Since 2010, there has been an endless series of crisis summits in Brussels and the German chancellor was always the center of attention. She was the one sitting on the biggest war chest, a fact which granted her far-reaching influence. And Merkel enjoyed her role as the queen of Europe. She didn’t lord it over the others: She wasn’t as loud as Gerhard Schröder and wasn’t as forceful as Helmut Kohl.

Instead, she did what no German chancellor had ever done before. She followed a policy of pedagogical imperialism, with the lesson plan calling for budgetary discipline, labor market reform and privatization. It worked in Spain, Portugal and Ireland, but in Greece, the conditions imposed by creditors were not seen as necessary medicine but as a poison that was destroying society.

Merkel saw what was happening, but she didn’t have the courage to face the consequences. And there were alternatives. She could have offered Greece a safe and supported path out of the euro zone. That is the course of action that Finance Minister Wolfgang Schäuble has supported internally for years. She could also have offered Greece a debt haircut. Had she done so at the right moment, she could at least have prevented the radicalization of Greek politics.

None of these options would have been free of risk. They would have required courage and money, and they would have opened up Merkel to attack. And that is something she didn’t want.

So she hid behind the troika, behind the hated technocrats, thereby accelerating the rise of Syriza. Indeed, Tsipras is, to a certain extent, a product of Merkel’s vacillating leadership style. In the Chancellery, people are expressing relief that Tsipras was unable to drive Europe apart and that nobody is blaming Germany for the current impasse. That may be true, but it is also a rather simplistic view. Success for Merkel is when nobody is pointing their finger at her.

In the Shadow of the Giant

In just under five months from now, on Nov. 22, Merkel will have been in office for a full decade. Thus far, she hasn’t paid much attention to her legacy. Which makes sense. The mere fact of who she is makes her unique among German chancellors. Konrad Adenauer firmly anchored Germany in the West. Willy Brandt reconciled Germans with democracy. Helmut Kohl is the chancellor of reunification.

Merkel is Germany’s first female chancellor. That’s not a small thing. It is important symbolically. But people who know her well say that Merkel is determined to run again in the next general elections. Because of Europe. She wants to use her power to reshape the Continent. Should the euro zone disintegrate, it would forever overshadow her time in office. She would be seen as a failed head of government.

Last Monday, Merkel held a speech on the occasion of the CDU’s 70th birthday, a good opportunity to say make a few things clear. Strangely, though, she remained trapped in the rhetoric that Helmut Kohl once used. The party was held in a power station, and Merkel noted in her speech that the facility had been part of the Wehrmacht’s last line of defense against the advancing Red Army. “Just like this factory, the entire country lay in ruins.”

Europe, she continued, is the answer to the horrors of that war. It is a nice thought and a vitally important one. But it is far from new. The consequence drawn by Kohl is that Europe must continually draw closer together. But Merkel has drawn no such conclusion. And therein lies her contradiction. She borrows from Kohl’s rhetoric, but not from his political convictions. Which explains why there is a growing gap between her words and her deeds.

What Does She Want?

Three days before the CDU celebration, Merkel was at an EU summit in Brussels. The Greek crisis was on the agenda, but there was another issue to discuss as well. European Commission President Jean-Claude Juncker tentatively presented a paper in an effort to give Europe a new goal, a new idea that reaches beyond the day-to-day.

He proposed that the Commission be granted greater powers — on budgetary oversight, for example. Juncker wasn’t trying to launch a revolution, nor was he trying to lay the cornerstone of a European government or to eliminate European nation-states. It was nothing more than an attempt to draw a couple of practical consequences from the euro crisis.

But Merkel doesn’t even want that. At the press conference following the summit, she spoke about everything: about Greece, about refugees trying to cross the Mediterranean, about Jacques Delors, who had been named an honorary citizen of Europe. Regarding Juncker’s proposal, she had but one thing to say: she “took note of it.” In politician-speak, that essentially means: Forget it.

Merkel wants a Europe of nation-states and not a deeply integrated Europe. She was concerned about Juncker running as the lead conservative candidate in 2014 European elections, worried — correctly — that it could result in a reduction of power for European heads of state and government. Furthermore, she doesn’t trust the European Parliament because majorities aren’t as dependable as they are in the Bundestag back home in Berlin.

The chancellor says none of this openly because it would contradict the CDU’s founding principle. She can speak like Kohl, but she breaks with what he stood for. Left behind is a confused EU that doesn’t know what the most powerful woman on the Continent actually wants.

Donors Conference on Ukraine – Stretching Out Hand for Miserable Pittance

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Donors Conference on Ukraine – Stretching Out Hand for Miserable Pittance

The Europe-Ukraine summit was a frustration for the Kiev’s regime. The donors’ conference that followed on April 28 ended up in total failure. Suffice it to say that the very word “donors” lost any meaning…Those who gathered at the meeting called it a conference on Ukraine’s reforms, the changes to be supported in words with no financial obligations to follow… No serious creditors appeared. The Ukrainian government had assured that China, India and Saudi Arabia were willing to invest. But they ignored the event. True, Beijing really had said before that it set eyes on big investment opportunities in Ukraine but now it reacts to the recently adopted law on “decommunisation”…
Dmitry MININ 07.05.2015

Act of Surrender Signed in Reims. “Not to Be Cancelled or Recognized”

More and more countries refuse to mark the Victory Day on May 9 as they used to do. Poland was the last to cancel the Day of Victory and Freedom on May 9 in favor of the national Victory Day to be celebrated on May 8. It is done to diminish the role of the Soviet Union in achieving the victory and forming the world system after the war… Even the countries and politicians friendly to Russia seek explanations to justify their decision to cancel the historic date for the sake of Euro-Atlantic solidarity. For this purpose they use the event that took place in Reims before the Act of unconditional capitulation of Germans was signed in Karlhorst on May 9.
Yuriy RUBTSOV 07.05.2015

Breslau and Dresden to Be Liberated After Berlin

Germany was losing one line of defense after another; the government led by Karl Dönitz replaced the government of Hitler who committed suicide. Berlin fell. But the forces concentrated in Breslau continued to resist. There were different reasons. The Goebbels propaganda promised a “miracle weapon” to change the tide of war. There were hopes the anti-Germany alliance would split apart leading to the start of separate talks between Germany and Anglo-Americans – Yuriy RUBTSOV 06.05.2015

The Economic Price of the Soviet Victory in the Great Patriotic War

The West continues to disavow the USSR’s momentous contribution to the defeat of Nazi Germany and her satellites. But there is documentary proof that can refute any speculation on this subject. Suffice it to point to the economic price of the victory won by the people of the Soviet Union…The USSR bore the burden of 53% of all the military expenditures and direct economic damages to the four victorious countries (USSR, USA, Great Britain, and France). Stalin was exactly right when he suggested at the Yalta Conference that half of all the German reparations should be paid to the Soviet Union…
Valentin KATASONOV 06.05.2015

Berlin Fell!
The seizure of Reichstag started by the early morning of the 30th, 1945. The 150th and 171st rifle divisions of the 3d Army led by Army General V. Kuznetsov were advancing to the building of German parliament – Reichstag. A fierce battle raged on during the whole day. A group led by Lieutenant A. Berest was ordered to clean the building and install the banner of Army’s military council at the top. The sergeants from this unit Meliton Kantaria and Mikhail Yegorov raised the Soviet flag over the Reichstag late at night on May 1…The Berlin garrison capitulated on May 2. But he war continued…
Yuriy RUBTSOV 02.05.2015

 

Modern Nazism as the Driving Force of Euro-Atlantic Integration

The growth of Nazism that has taken place in Europe over the last few years, the increased activities of fascist groups, the cultivation of fascist ideology at the level of individual state leaders, and the repeated attempts to revise the outcome of the Second World War all have deep-rooted causes. At the heart of this phenomenon is the desire of the Western architects of a ‘new world order’ to use modern Nazism as an instrument of European integration, which has already more or less merged with Euro-Atlantic integration…

Pyotr ISKENDEROV 01.05.2015

Kiev Starts to Get Frustrated With Europe

 The April 27 Ukraine-EU summit in Kiev frustrated the hosts. The joint declaration was turgid enough praising bold plans for reforms and condemning Russia’s «aggressive actions» on Ukrainian soil. It is clear that Brussels has no real intention to shoulder any serious responsibility. So Ukraine got nothing but promises, no matter the whole political philosophy and strategy of Kiev regime is centered on «European prospects»…
Dmitry MININ 30.04.2015

America Refuses to Face up to Its «Death Squads» in Blue

Media pundits and politicians are calling the violence that broke out in Baltimore after the spinal cord severance death, while in police custody, of African-American Freddie Gray a «wake up call». However, these self-appointed «experts» on the social collapse of poor, mostly African-American working class neighborhoods across the United States, are avoiding talking about the real reason cities and towns across America are erupting in protest and resorting to rioting every time a young African-American is murdered by the police…
Wayne MADSEN 30.04.2015

More to be added.  Our thanks to the Strategic Culture Foundation.

The pope’s speech to the European parliament: rediscover your core values

Pope Francis leaves the European parliament in Strasbourg

Pope Francis leaves the European parliament in Strasbourg

 

Few speeches about Europe these days arouse much enthusiasm. The subject is more likely to be greeted with boredom or acrimony, the debate conducted in instant and shallow slogans. So the pope’s message to the European parliament in Strasbourg on Tuesday, calling for a break from the current angst and “a return to the conviction of the founders of the European Union” came as something of a shock.

It did not play down the woes and inadequacies of the current state of European affairs. On the contrary, the speech included descriptions of the “distrust of citizens towards institutions considered to be aloof, engaging in laying down rules perceived as insensitive to individual people”. But those – step forward, Nigel Farage – who thrive on channelling populist sentiment against the very essence of the European project would be fools or, more likely, cynics to claim that Pope Francis has vindicated them in any way.

Indeed, far from seeking to fuel further disenchantment with the EU, this was a strong-minded plea for a better Europe, one in tune with its founding values of “human dignity” and fundamental rights. It was no Faragiste demand to dismantle or diminish the enterprise. It was instead a call for the “confidence needed to pursue the great ideal of a united and peaceful Europe”.

No less important, it was a speech urging all Europeans to look at themselves not through the prism of narrow domestic or intra-EU disputes, but as a continent of many blessings, despite the current anxiety, not least in the eurozone. Yes, it must redefine its role and ambitions in a globalised, interconnected and more complex world. But Europe is far from over: it accounts for only 7% of the world’s population, but 25% of its GDP and 50% of its public spending.

As Francis pointed out, this globalised world has become “less and less Eurocentric”. The Argentinian pope has great credibility to make this point, as well as to remind Europe that it needs to reach out to those who endure great ordeals to reach its shores. For years Jorge Mario Bergoglio built his image and his pastoral activities in Buenos Aires as the archbishop of the poor, the favelas and the downtrodden. He is the first non-European pontiff in over a thousand years, well aware that today’s Catholic church has its greatest constituencies in the global south, parts of the world where Europe is regarded with “aloofness, mistrust and even, at times, suspicion”. In 2013, his first trip outside Rome after becoming pope was to the island of Lampedusa, scene of too many migrants’ tragedies.

By castigating a Europe that produces a “general impression of weariness and ageing”, a Europe which is now a “grandmother … no longer fertile and vibrant”, the pope intended to issue a wake-up call. He aimed his criticism at the plight of the unemployed in the age of austerity and on how contemporary society pushes individuals towards an “uncontrolled consumerism”. The pope wants Europe to “rediscover the best of itself”. Some may see that as a call for miracles. Others will cringe at the reference to lack of fertility. But the overall message must be welcomed for the right reasons, which are about strengthening the EU, not undermining it. The time is long overdue for more voices to speak out, for Europe’s politicians, not least in the UK, to present their vision of the “better” EU they want – and are ready to defend.

Has the Mafia Taken Over in Brussels? This is how it started…

 A EUROPE FOR THE PEOPLE AND BY THE PEOPLE?

European_flag_in_Karlskrona_2011

Any lingering doubts as to which political direction the European Union is now heading in were cleared up once and for all in 2008 when Justice Commissioner Franco Frattini announced plans to fingerprint and screen all visitors who cross its borders. From 2009 it will become mandatory for all EU passports to include a digital fingerprint and photograph and, from 2011 non-EU citizens who apply for a visa will have to give their biometric details.

Frattini’s plans currently envisage taking the fingerprints of children as young as six, but Security officials predict that records will eventually be taken at younger and younger ages as the technology develops. If approved by all 27 member states, the plan would represent one of the largest security overhauls ever undertaken in the European Union and cost billions of dollars.

So who exactly is Franco Frattini and why do he and his associates seemingly want to turn Europe into a “Big Brother” society where the privacy rights of individuals are routinely violated? And what about the Mafia connections of Mr. Frattini?

EU Justice Commissioner Franco Frattini, who, along with his associates, wants to turn Europe into a “Big Brother” society where the privacy rights of individuals are routinely violated under the pretext of “fighting organized crime”.

Appointed to the Commission in 2004 – having previously been Italian Foreign Minister and a loyal aide of the then Italian Prime Minister Silvio Berlusconi – Frattini’s selection was immediately mired in controversy amidst accusations that he was a Freemason.

Freemasonry has been a highly sensitive issue in Italy since 1981, when a secret and illegal right-wing Masonic lodge known as P2 – Propaganda Due – was broken up amid public scandal. Notably therefore, Silvio Berlusconi was revealed to be amongst the almost one thousand names listed as its members – who included senior figures in banking, business, the intelligence services, journalism, the military and politics.

Silvio Berlusconi was revealed to be amongst the almost one thousand names listed as members of the illegal right-wing Masonic lodge known as P2.

Currently campaigning to return to power in Italy as Prime Minister, Berlusconi is alleged to have joined P2 in 1978. Over the years he has subsequently found himself involved in more than a dozen different criminal trials, appeals and other investigations and been accused of fraud, false accounting, bribery and Mafia connections.

It turns out that Berlusconi is in good company however. One of his closest friends and business colleagues – the Italian Senator Marcello Dell’Utri, who is also the Italian delegate at the Council of Europe – has already been convicted of collusion with the Mafia. Whilst Dell’Utri’s case is still under appeal, his job at the Council of Europe will shelter him from the verdicts of Italian courts due to the immunity from prosecution it provides, as enshrined in article 15 of the European Union’s general agreement, signed in Paris in 1949.

The Italian Senator Marcello Dell’Utri, who is also the Italian delegate at the Council of Europe, has been convicted of collusion with the Mafia. Whilst his case is still under appeal, his job at the Council of Europe will shelter him from the verdicts of Italian courts due to the immunity from prosecution it provides.

Historically, P2 is well known to have had links to Nazism and extreme right-wing groups. Licio Gelli, its former grandmaster, was jailed in 1998 for corruption and fraud in connection with the Banco Ambrosiano scandal and has been openly described by the New York Times as “a known Fascist.” The investigative writer David A. Yallop, in his book ‘In God’s Name: An Investigation into the Murder of Pope John Paul I’, even alleges that Gelli was involved in a conspiracy that led to the murder of Pope John Paul I, who reigned for only 33 days, in 1978.

Even more disturbingly, some sources, including the New Zealand Herald and The Observer newspaper in the UK, allege links between P2 and state terrorism. Others meanwhile, such as the BBC, state it had connections with both the Mafia and right-wing terrorist groups.

Is this the sort of Europe that you want to live in? A Europe controlled by the likes of Franco Frattini and powerful, super-wealthy individuals such as Silvio Berlusconi? A Europe where your privacy rights and freedoms are routinely violated and in which you will have no democratic means of expressing your opinion?

Unless these people are stopped, it is clear that Europe will increasingly turn into an “Orwellian continent” where dictatorship, not democracy, is the sole order of the day.

 

Endgame: Power Struggle in Brussels and Berlin over Fate of Greece

European Commission President Juncker wants to keep Greece in the euro zone, no matter what the price. Member states, though, are beginning to lose their patience. Who will ultimately have the final say?

Jean-Claude Juncker, Alexis Tsipras

Jean-Claude Juncker understands the importance of symbols in politics. When he became president of the European Commission last fall, he surprised the political powers that be in Brussels with a mini-coup. One of the privileges reserved for the new head of the European Union executive is that of promoting a close confidant to be his spokesman. After all, the position of spokesman is crucial for ensuring that the Commission president is seen in a positive light.

But Juncker tapped a man named Margaritis Schinas, a 52-year-old lawyer from Thessaloniki who had until that moment been just another in the unremarkable army of bureaucrats that walk the Commission halls in Brussels. Even today, Schinas remains astonished at his huge promotion. What made him, a rather reserved bureaucrat, qualified to explain the daily work of the Commission to journalists from around Europe and the world? But for Juncker, the gesture was the important thing. He wanted to show that oft-reviled Greece was a crucial part of the European Union.

It was a farsighted decision, that much can be said today. In Brussels, the endgame over Greece’s continued euro-zone membership has begun. Greek Prime Minister Alexis Tsipras is trapped between his campaign promise to put an end to EU-imposed austerity and his rapidly emptying state coffers. Meanwhile, his government’s tone has become increasingly shrill. Most recently, Justice Minister Nikos Paraskevopoulos threatened to auction off the Goethe Institute in Athens in accordance with his government’s demands for World War II reparations from Germany. And this Thursday, the Greek government lodged an official complaint with Berlin, accusing Finance Minister Wolfgang Schäuble of insulting his Greek counterpart.

Acts of Desperation

They are acts of desperation. In recent weeks, the European Central Bank once again tightened the thumbscrews on Athens and is only approving small amounts of money at a time. At ECB headquarters in Frankfurt, officials have begun speaking more or less openly about the looming Grexit.

Now, Juncker has become Tsipras’ last hope. Last week, the Commission president made clear that Greece’s departure from the euro zone is out of the question. “The European Commission’s position is that there will be no Grexit,” he said in an interview with the German weekly Welt am Sonntag.

On Friday, prior to a meeting with Tsipras in Brussels and in the context of Greece’s possible departure from the common currency union, Juncker said, “I am totally excluding failure.” The comment pleased Tsipras, who said later he was “optimistic,” because he was discussing Greece’s future with good friends. The politicians then agreed during a two-hour meeting that the government in Athens would appoint a high-ranking politician to handle the coordination of Greece’s cooperation with the European Commission.

The Greek government also wants to set up a task force of its own to serve as a partner to a similar body on the Commission, which has been providing development aid to Greece for several years now. “The moment has come — parallel to the Euro Group process, we have to establish this track to help with jobs and growth in Greece,” Juncker spokesman Schinas later said, describing the goals of this cooperation after the meeting.

image-823255-panoV9free-inug

Graphic: Who holds how much Greek debt?

As such, the Greece crisis has moved beyond being merely a poker game with billions at stake. It has now become a question of who holds power in Brussels. The Commission president isn’t the only one leading negotiations with Greece. The Euro Group, under the leadership of Dutch Finance Minister Jeroen Dijsselbloem, is instrumental in the talks too. And in the end, German Chancellor Angela Merkel will also have a decisive word to say. Germany, after all, is Greece’s largest creditor, with €63 billion having been loaned to Athens thus far. Publicly, however, Juncker has presented himself as being master of the common currency.

Protecting His Reputation

Political leaders in Berlin understood Juncker’s words just as he meant them: as a challenge. Merkel too, to be sure, would like to prevent Greece from leaving the euro zone. She is concerned about the chaos that would ensue in Greece — and from a practical perspective, a Grexit would mean that Germany would have to write down the billions it has loaned Athens for good.

Merkel, though, sees Juncker’s categorical promises as undermining efforts to force the Greek government to see reason. Merkel’s advisors in the Chancellery are wondering how it is possible to take a tough negotiating stance with Tsipras when the most severe penalty has been ruled out by the Commission president. But Merkel’s team suspects that Juncker also may be trying to protect his own reputation: Should Greece ultimately be forced out of the euro zone, it would be clear to all that Merkel, rather than Juncker, is to blame.

The relationship between the two is so tense that it is hard to miss during joint appearances they make. During Merkel’s visit to Brussels last week, Juncker gushed that it was “a delight, a pleasure and an honor” to welcome the chancellor. He said he didn’t understand the “obduracy” of some in the German media who continue to report about alleged disputes between him and the chancellor.

Merkel was so taken aback by Juncker’s unctuous charm that she sought refuge in metaphor. First, she used a German saying, asserting that underscoring her tight bond with Juncker was as superfluous as bringing owls to Athens. But the reference to Greece didn’t sound quite right, so she said: “or, as they say in English, refrigerators to the Eskimos.” Juncker grinned impishly.

Both know that Greece’s fate is in their hands. At first glance, everything seems to currently depend on the European Central Bank and its head Mario Draghi. But both Merkel and Juncker are certain that Draghi will shy away from pushing Greece out of the common currency area. Several months ago, Draghi told the chancellor that such a decision had to be made by politicians and not by a central banker.

Stricter Guidelines

That, though, hasn’t prevented Draghi from continually increasing the pressure on Greece. Athens is only able to keep its head above water at the moment because Greece’s central bank, the Bank of Greece, is providing Emergency Liquidity Assistance (ELA) to financial institutions in the country and because euro-zone members have allowed Athens to issue €15 billion worth of short-term T-bills, most of which are bought up by Greek banks.

On Thursday, the ECB only approved ELA aid for another seven days. Previously, approvals have always been made at 14-day intervals. Furthermore, the European banking supervisory body, which is part of the ECB, issued a written warning to Greek banks two weeks ago to avoid taking on additional risk by purchasing the T-bills. Now, the supervisory authority appears ready to issue stricter guidelines to specific banks, which will further intensify the Greek government’s predicament. The ECB Governing Council must still authorize this step.

Many in the ECB are aware that they are operating at the very fringes of legality. French Executive Board member Benoît Coeuré issued a public warning a few days ago that the ECB is not allowed to finance the Greek government. Doing so, he said, is illegal. Draghi, said an official in Berlin, “could cut Greece off at any moment.” But, the official added, he doesn’t dare.

Which means it is up to the politicians to find the way forward. And finding that path has become dependent on the ongoing conflict between Juncker and the EU member states, led by the chancellor. It has long been apparent that the Commission president wants to prevent a Grexit at all costs, at least since he received the Greek prime minister in Brussels five weeks ago as though welcoming a long lost friend. Two weeks after that, Economic and Financial Affairs Commissioner Pierre Moscovici presented a plan that looked more like a package for growth than like strict requirements for Greece. Greek Finance Minister Yanis Varoufakis had nothing but praise for the paper.

The other Euro Group finance ministers weren’t nearly as enthusiastic. In the end, the Moscovici paper proved largely irrelevant, but it had, from Juncker’s perspective, had its effect. It was a demonstration of power; he had simply wanted to send a message to Merkel.

Breaking with the Kohl Line

The conflict between Brussels and Berlin is a fundamental one. Juncker is taking the position that Christian Democrats have supported for decades. The European Union, in his view, is the answer to the horrors of the wars that destroyed Europe in the first half of the 20th century — and the Continent’s salvation, he believes, lies in further deepening the ties that bind the European Union together. It is no accident that he presented former German Chancellor Helmut Kohl’s book last fall. The book is called “Out of Concern for Europe,” and many have interpreted it as indirect criticism of Merkel’s approach to the EU.

Though Merkel is a Christian Democrat herself, she has broken with the Kohl line. For her, Europe is not a matter of war and peace, but of euros and cents. Merkel has used the euro crisis to reduce the European Commission’s power and to return some of it to member-state capitals. From this perspective, she could be seen as a 21st century de Gaulle.

Juncker would like to get in her way and the Greece crisis is the instrument that has presented itself. “We have to keep the shop together,” Juncker has said repeatedly in background sessions with journalists in recent weeks. This Friday, Juncker received Tsipras in Brussels yet again, with the Greek prime minister also holding talks with European Parliament President Martin Schulz.

Juncker entered office wanting to make the Commission, the European Union’s executive body, more powerful and more political — and thus far, he has been successful. He defanged the European Stability Pact, that German invention that was to prevent euro-zone member states from taking on too much debt. And he has ensured that France’s Socialist government receive an additional two years to reduce its budget deficit. Juncker’s introduction of the deal with Paris was so deft that Merkel had little choice but to reluctantly approve it.

Now, though, it is Greece’s turn and Merkel wants to keep the country in the euro zone. But even if the chancellor has had to make plenty of concessions since the euro crisis began in earnest in 2010, the core of her position has remained unchanged: Those needing aid must agree to reforms. She doesn’t intend to be budged from this conviction, neither by Tsipras nor by Juncker.

‘Get to Work’

Merkel has plenty of allies at the moment. The finance ministers of the rest of the euro-zone member states have all begun losing patience with Varoufakis and his orations at the frequent Euro Group meetings. German Finance Minister Wolfgang Schäuble has furthermore made clear that he can imagine a euro zone without Greece and has negotiated accordingly.

Not even France or Italy, natural allies to Greece when it comes to the desire for a weaker Stability Pact, are jumping to Athens’ aid. Indeed, some euro-zone finance ministers have begun complaining of Varoufakis’ vanity. “We told the Greek finance minister that he should stop giving interviews and get to work,” says Finnish Finance Minister Antti Rinne.

For many euro-zone governments, the conflict with Greece is also a question of survival. If Tsipras is able to get what he wants, Spain’s conservative government is concerned it might lose to the left-wing protest party Podemos in elections at the end of this year.

The Finnish governing coalition, meanwhile, faces elections in April and must defend itself against the anti-EU party True Finns. The right-wing populists believe that the euro-zone is already being too understanding of Greece. As such, Finance Minister Rinne is happy that he can point to guarantees his government negotiated in return for helping Greece. “We don’t want a Grexit. But if the country can no longer pay back its loans, we have the securities that we pushed through in 2011 negotiations with Greece and the euro zone,” he says. Forty percent of the Finnish loans are guaranteed by bonds issued by countries like France and the Netherlands.

As such, Merkel and Schäuble don’t lack for powerful allies in their battle with Juncker. Member states, who guarantee the money made available to Greece, do not want to see the Commission deciding over the fate of their taxpayers’ money. “It is easy to be generous with other people’s money,” said a senior Finance Ministry official in Berlin.

Schäuble believes that Juncker is being far too indulgent of the Greeks. When, for example, Athens once again sought to conflate debt negotiations with the debate over war reparations, Juncker refrained from censure. The issue, he said via a spokesperson, is a “bilateral one.”

The Cyprus Model

Merkel’s problem is that she can’t shove Juncker aside quite as easily as she could his predecessor. José Manuel Barroso was, to be sure, just as indulgent with Greece and even threw his support behind the communalization of EU debt. But when things got serious, he would acquiesce to Merkel in the knowledge that he was only still in office because of the protection provided by the German chancellor.

That is not the case with Juncker. He is the first Commission president to have campaigned as his party’s lead candidate in European elections, thus allowing him to claim a modicum of direct democratic legitimation. He also enjoys the support of a majority of the delegates in European Parliament — and works closely together with the Social Democratic Parliament President Schulz, who likewise wants to prevent a Grexit at any price.

And Juncker is determined to play a role in the Greece negotiations. Partially for that reason, he had his staff speculate about when Athens might need a third bailout package. He only backed down following fierce protests from the Spanish government. Economic and Financial Affairs Commissioner Moscovici said that a third bailout package would only be discussed once the current negotiations over Greece’s reform plans are completed.

But will they ever be concluded? Central bankers across Europe are planning for a rapid Greek withdrawal from the euro zone. “In this special situation, governments and parliaments have to decide if they are prepared to further extend their Greece risks,” says Jens Weidmann, president of Germany’s central bank, the Bundesbank. In other words, if it were up to him, Greece would long since have ceased being a problem. It has also been reported that the Spanish central bank believes that the Grexit will take place sometime in the next several weeks.

The chance that the “risk scenario” — as the Grexit is occasionally called — becomes reality is now well over 50 percent, say central bankers. Though the word “risk” is not entirely accurate. Central bankers believe that dangers relating to Greece’s exit from the euro zone could be contained. Other debt-laden countries, they point out, are in much better shape than they once were and the ESM euro bailout fund is ready and waiting should it be needed. Furthermore, the ECB’s sovereign bond-buying program would soften the blow. Many believe that were Greece to leave the euro behind, the common currency zone would be much more homogenous and stable than it is now.

In the end, though, it is up to the politicians, like Merkel and Juncker. The chancellor is now certain that a “Graccident,” or exit-by-accident, is no longer much of a danger. Her advisors have taken a closer look at the Cyprus crisis, which saw the country come within a hair of leaving the euro zone two years ago. At the time, the ECB threatened to cut off emergency aid to Cypriot banks because the country’s parliament refused to accept EU austerity demands. Banks had to shut teller windows for several days and impose limits on withdrawals and transfers abroad. But even in such an extreme case, there was still enough time for the political process to run its course. In the end, the Cypriot government gave in during a dramatic nighttime meeting.

Maybe, say some in the German government, Greece needs just such a “shot over its bow.”

By Nikolaus Blome, Martin Hesse, Christoph Pauly, René Pfister, Christian Reiermann and Gregor Peter Schmitz