#michael rass

[euro-journal]

The Brexit nightmare unfolds

We told you so somehow doesn’t quite do it justice, does it? Most of the experts had warned of financial turmoil should the United Kingdom decide to leave the European Union and now the British pound is sinking faster than the Argentine peso, hitting 30-year lows against the US dollar. Major international companies are considering to move their European headquarters to different EU locations, so there won’t be any disadvantages for them once Britain actually leaves.

Businesses across the UK are implementing hiring and investment freezes because of the economic uncertainty. The staid Economist magazine summarized the situation with the headline Anarchy in the UK.

They were not only referring to the economy, either. Brexit shockwaves have sent both major political parties into disarray. First, Prime Minister Cameron resigned unexpectedly after the referendum gamble blew up in his face. The days of turmoil that followed his announcement to step down before October have already devoured the very people that brought about his downfall: former London Mayor Boris Johnson and Justice Secretary Michael Gove.

The task of taking Britain out of the EU will now fall to Home Secretary Theresa May or Energy Minister Andrea Leadsom, it seems. There won’t be too much interference from the opposition Labour Party which is mostly occupied with its own post-Brexit power struggle.

Another frightening aspect of the whole fiasco is how the Leave vote has released an ugly torrent of racism into the streets of England. EU nationals living in the UK, previously confident that European citizenship gave them the same rights as UK nationals are not so certain anymore. Especially East Europeans feel less than welcome in Britain these days.

So, what’s ahead then? Over 40 years of integration will take a while to undo. Leave supporters had naively hoped they could just get rid of all those pesky EU regulations and the unwanted “ever closer” political union, return to their imaginary land of hope and glory, and all will be fine. No hard feelings, right? They got another thing coming.

Disengaging Britain from the European Union after four decades will be far from easy. Being part of a single market with 27 other nations has numerous advantages–that is the whole point of membership after all. Just take a look at the German Zollverein of the 19th century.

There will be economic contagion for the rest of the EU, of course. As the Greek bailout crisis has shown, if one link melts down it will affect the entire chain. So, here we have another severe crisis for the European Union caused by the reckless behavior of a member state. The difference is that Greeks by and large understand the value of EU membership, despite all the anger over the “diktat from Brussels.”

After the foolish self-mutilation, the next British prime minister will probably have to impose severe austerity measures to reboot her country’s economy but there will be no bailout money from Brussels, that’s for sure.

The whole European Project will require a reboot as well. The Greek crisis is festering on–off camera. The migrant crisis is still unresolved, there are serious terrorist threats and the economic fallout from the British exit are just beginning to emerge.

These are all tough challenges that will require skillful leadership and genuine cooperation. And maybe, just maybe, the British folly will make the rest of the EU remember what a great fortune the Union really is. It’s a good sign that anti-EU parties in Germany, Austria and the Netherlands are declining in the polls after there had been fears that the vote in Britain could entice other EU member states to stage similar referendums.

Maybe, with the British slowpokes off the brake the remaining EU partners can make the best of a bad situation and push European unification forward a little bit.

[euro-journal]

Why Europeans are baffled about the shutdown in Washington

In most places around the world, governments only shut down during revolutions, after military defeats or natural disasters. The Assad regime in Syria has managed to pay its bills and employees even while fighting off a major rebellion.

When Belgium was without a new government for over 500 days after an inconclusive election, the national administration didn’t shut down, everybody continued to be paid, no national museum had to close. 

That this could happen to the world’s only superpower because one political party disagrees with a law already adopted seems strange and unreal to many Europeans.

“That leaders of one of the most powerful nations on earth willingly provoked a crisis that suspends public services and decreases economic growth is astonishing to many,” reports Anthony Zurcher for BBC News

“America’s financial crisis becomes the Neverending Story,” writes Sebastian Fischer in Germany’s Der Spiegel: “A world power is blocking itself.” 

The Frankfurter Allgemeine Zeitung compares the shutdown in Washington to the aftermath of Germany’s federal election. “Should the current negotiations to form a coalition drag on, Germany could be without a budget in 2014. Our public administration  would continue without causing too much attention. [..] a shutdown in Germany would be impossible,” assures the FAZ its readers. 

That's because in Germany, the federal government is constitutionally required to use funds to keep its agencies operational - even without a budget.

Both France’s Le Monde and Germany’s Süddeutsche Zeitung are trying to explain “le shutdown” to its reader with a short Q&A while Britain’s Guardian looks at the economic consequences for the rest of the world: 

“Any prolonged shutdown would rapidly start to hit US consumer spending, as hundreds of thousands of public sector workers are furloughed; and that will crimp America's demand for imports from the rest of the world.”

Nicolas Richter notes in an op-ed on sueddeutsche.de that “it’s easier at the moment for President Obama to talk with a Middle Eastern theocracy than with politicians meeting only a few blocks away from the White House.” 

“To some extent Obama’s opponents (in the tea party and Iran) are similar: both regard themselves as revolutionaries and define themselves by resisting a stronger power,” says Richter.

The reaction on European financial markets has been modest so far, despite the bad day on Wall Street yesterday, European markets largely saw the shutdown coming and have been adjusting for it. 

The question is now, how long will it last.

[mikerass]

Another German minister resigns after having doctorate revoked

German Chancellor Angela Merkel has been dealing with yet another plagiarism scandal.

Federal education minister Annette Schavan resigned Saturday after a university decided to withdraw her doctorate, finding that she plagiarized parts of her thesis — a major embarrassment for Merkel’s government which faces an election later this year.

On Tuesday, an academic panel at Düsseldorf’s Heinrich Heine University voted to revoke Schavan’s doctorate following a review of her 1980 thesis, which dealt with the formation of conscience (Person und Gewissen). The review was undertaken after an anonymous blogger had raised allegations of plagiarism, which Schavan has denied.

Despite pleading ‘not guilty’ so far, she has now resigned her post, probably because she didn’t want the sorry affair to drag on, especially in an election year. 

That’s pretty much what happened two years ago when then defense minister Karl-Theodor zu Guttenberg had to quit after allegations he plagiarized his thesis at Bayreuth University. 

Guttenberg became the victim of crowd sourcing and search engines.  An internet wiki called ‘GuttenPlag’ emerged in February 2011 and invited users to google and otherwise check Guttenberg’s thesis for lifted passages.

It didn’t take long to find them. Guttenberg initially denied any plagiarism, then conceded that some of the footnotes were possibly ‘sloppy’ before asking for his doctorate to be rescinded. Bayreuth University obliged forthwith while Guttenberg was publicly ridiculed as “Dr. Copy & Paste.”

The public spectacle caused Merkel’s government serious embarrassment for way too many days and clearly both the chancellor and Schavan, who is a personal friend of Merkel’s, wanted to avoid a repeat of that.  

Schavan, too, has been fact-checked on the Internet, by 'SchavanPlag' in this case. 

However, Schavan maintains her innocence and intends to fight the decision of the Heinrich Heine University. She will also remain a member of parliament for Merkel’s CDU party - at least for now.