Mario Draghi, banker and author of the Ursula von der Leyen commissioned report, The future of European competitiveness – A competitiveness strategy for Europe
My previous post, The West’s poltroons and Quislings, should have read: Europe’s poltroons and quislings. Other than half a footnote on Australia’s own economically suicidal tendencies to further Washington agendas, its target was a Europe rapidly mutating from junior partner to full blown semi-colony of the United States.
The betrayal, on the face of it bewildering, of European interests by leaders within and beyond the EU was explained by Radhika Desai, who spoke of men and women who …
… have been through the US ideological factories … the think tanks, the annual meetings etc. You know, the Leaders of Tomorrow programs for which these people go to the USA on junkets, and become part of a network of leaders with a similar understanding of what is to be done, both domestically and internationally. People like Starmer, Macron, von der Leyen and Annalena Baerbock … they belong to these circles. So in answer to the question – why are European governments acting so manifestly contrary to the interest of their economies, their people etc? – the only reason I can find is that the people Washington has groomed have taken power in major European capitals.
The curriculum vitae of Mario Draghi – former President of the European Central Bank (in which role he oversaw Greece’s right royal shafting) then unelected prime minister of Italy – is a case in point. Educated at Massachusetts Institute of Technology in the seventies, he went on to cut his neoliberal teeth at Goldman Sachs. That assuredly makes him “one of us”, as far as Britain’s Financial Times is concerned. Three days ago, editorialist Daniela Schwarzer had this to say:
FT, September 13. Click on screenshot to access the story
Now it just so happens that the “report on competitiveness” of which the FT speaks featured prominently in the discussion of Europe’s poltroons and quislings – my terms not theirs – by Dimitri Lascari, Michael Hudson and Radhika Desai. It further just so happens that the report has been scrutinised in more detail by Conor Gallagher, who comes to very similar conclusions in yesterday’s Naked Capitalism.
And what would those very similar conclusions be? Why, that Europe should do exactly as the sagacious FT counsels, and listen to Super Mario, of course!
Just fooling. Conor’s title, with which Dimitri, Michael and Radhika would fully concur, suggests the very opposite.
The EU Retreats Further into a World of Self-Delusion
The situation in Europe is getting so bad on so many different levels, the Brussels crowd had to bring in “Super” Mario Draghi to save the day — or at least write a report telling them what to do.
Draghi has spent time at Goldman Sachs, the European Central Bank (ECB) during the sovereign debt crisis, and as unelected prime minister of Italy during the early days of the Covid pandemic and runup to Project Ukraine. Depending on where you sit, he could be an odd choice to chart a path forward; while Draghi knows his way around a crisis control center, he’s also plenty experienced at creating them.
He was one of the chief architects of the EU’s disastrous economic war against Russia and he’s always been a grim reaper for working class citizens of his native country of Italy. No wonder that for months the neoliberal, war-loving spreadsheet crowd in Brussels has eagerly awaited the report as if it is manna from heaven that will help deliver them from the corner they have backed themselves into.
Curiously, his report was delayed by months, which only increased the anticipation, and it finally dropped last week, conveniently timed at another crisis point. Project Ukraine is quickly unraveling and pressure is coming from all directions for Berlin to give the go ahead for joint EU debt in order to make the EU “competitive” again and buy a bunch of weapons to do something (nobody is too sure of what exactly) about Russia. Indeed, Draghi’s report doesn’t say, nor does it ever consider making nice with Moscow.
Conor’s witheringly detailed take down – here again is the link – merits a close read, as do the comments below it. This extract gets to the heart of the matter:
Let’s take a step back and really look at what Super Mario is saying in his 400-page screed.
It’s all about EU competitiveness. Well, there are plenty of issues, but one of the biggest reasons the EU’s slow decline became a full-blown crisis is energy. What happened?
Here’s Draghi’s story:
Europe has lost its most important supplier of energy, Russia. Geopolitical stability is waning, and our dependencies have turned out to be vulnerabilities … EU companies face electricity prices 2-3 times those in the US. Natural gas prices are 4-5 times higher. Europe met its demand for imported energy by procuring ample pipeline gas, which accounted for around 45% of EU’ gas imports in 2021. But this source has now disappeared at huge cost to Europe. The EU has lost more than a year of GDP growth while having to re-direct massive fiscal resources to energy subsidies and building new infrastructure for importing liquefied natural gas.
There’s more:
High energy costs in Europe are an obstacle to growth, while lack of generation and grid capacity could impede the spread of digital tech and transport electrification. Commission estimates suggest that high energy prices in recent years have taken a toll on potential growth in Europe. Energy prices also continue to affect corporate investment sentiment much more than in other major economies. Around half of European companies see energy costs as a major impediment to investment – 30 percentage points higher than US companiesii. Energy-intensive industries (EIIs) have been hit hardest: production has fallen 10-15% since 2021 and the composition of European industry is changing, with increasing imports from countries with lower energy costs. Energy prices have also become more volatile, increasing the price of hedging and adding uncertainty to investment decisions.
Notice the lack of agency in Draghi’s telling? It’s as if a natural disaster swept down from the heavens, destroyed all the pipelines transporting Russian gas to the EU, and now prevents them from ever being repaired. In reality, the decision is wholly that of the Scholzs, Macrons, and von der Leyens of Europe (and their benefactors).
Conor goes on to quote none other than the President of the Russian Federation:
It is very strange, I cannot get my head around it. They blew up the gas pipeline in the Baltic. They blew up both Nord Stream 1 pipelines and one Nord Stream 2 pipeline. The second is now fully functional, though. What stops the German government from pressing the button, coming to terms with us and turning it on? How much is it? 25 billion cubic metres through one pipeline? …Well, if they don’t want to, they don’t have to. It will be a loss for them. For us, there will be some reduction in revenues, but it’s no big deal.
Before realising that Washington would, absurdly, 1 deny it had any hand in the Nordstream explosions – described in the previous post as “an act of economic terrorism and eco-vandalism with catastrophic consequences for Europe” – Sikorski, Polish MEP and husband to US neocon Anne Applebaum, tweeted the above. Hours later he deleted it.
Part of Mr Draghi’s ‘solution’ to Europe’s woes is to increase debt to buy US weaponry at eye-watering cost from that country’s obscenely bloated – for reasons touched on by Michael and Radhika yesterday – military industrial complex. Leaving it to Conor and Mr Putin to voice the sane and grown-up alternative.
(Though in truth my “grown up” is an insult to children famously able – because unencumbered by ideological baggage which dare not speak its name – to know an elephant in the room when they see one. A few can even tell when an emperor’s eunuch is stark bollock naked.)
Were Europe’s leaders honest brokers, they might grow a pair, eat humble pie, and mitigate some of the devastation their folly and supine venality, above all their obsequious treachery, have wreaked.
The EU could just stop all this now. The goal was clearly to cause a collapse of the Putin government, install a puppet friendly to the West, and exploit Russia. 2 It failed.
Time to go hat in hand and start begging and maybe in time regain some of what has been lost. Russia has no designs to conquer Europe. So there’s no need to drop hundreds of billions on weapons that, at best, would help escalate to a nuclear war.
Too painfully simple? That’s where Super Mario Draghi comes in.
Instead get 400 pages of smart-sounding economic nonsense in line with all the think tank fantasies about the EU taking the Russia baton from the Americans who will turn their attention toward China.
Eat humble pie? Grow a pair? Dream on! Europe’s US-groomed leaders are beyond redemption. But what of its massively propagandised public? Given the stakes, is it too much to ask that the rest of us finally wake up and smell the coffee?
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- Even more absurdly, Washington would try to finger Putin as the Nordstream perp. Why in God’s name? To punish Germany? Are Russia’s leaders such numbskulls they wouldn’t think to simply turn off the tap? Duh!
- For all his drunken bluster, the West had precisely such a puppet in Boris Yeltsin. Wall St. has been mourning that flailing man since the day Vladimir Vladimirovich Putin took over to oversee his country’s remarkable – all the more so given the oligarchic legacy he must even now negotiate – national resurgence and economic turnaround from the disaster capitalism, IMF prescribed and ably documented in Chapters 10-11 of Naomi Klein’s Shock Doctrine, of the Yeltsin nineties.