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Wednesday, July 19, 2023

Point of Order: What will the new New Europe look like?



When so many changes happen at once, it’s hard to pick out the significant ones, let alone untangle the causation.

But Poland’s goal of becoming the strongest military power in Europe might be up there. The government plans to double the army in size and is pushing defence spending up to 4% of a rapidly-growing GDP. This also predates Putin’s invasion of Ukraine.

The Polish authorities want to be able to fight and win a European land war (perhaps in conjunction with Ukraine, the other new European midi-power). Should that be necessary. Or even expedient?

Contrast this with the generational run-down of western Europe’s fighting capability (exemplified by the near-dismantling of Germany’s military and the institutionalisation of pacifism). Despite some camouflage, Germany’s most notable contribution to the war effort seems to have been blocking the re-export of Leopard tanks. Even Britain’s admirable Ukraine-supporting defence minister, Ben Wallace, has proposed shrinking army numbers to a two hundred year low in order to pay for new kit.

Poland’s leaders must be sceptical about theories of the End of History (although their thinking is oddly consistent with the concept of the Last Man.)

Economic divergence has also been underway for some time. The New European (ie, eastern) economies like Poland were growing faster than their western counterparts long before covid.

But it’s only now that the implications of economic catch-up are entering popular discourse. Connoisseurs of the genre will admire the chutzpah with which Britain’s Labour party is using the fear of falling behind Poland to promote policies which appear even more hostile to growth than those of the current Conservative government.

But the more serious implications are for economic governance and power in the EU, as explained by Hungary’s PM, Viktor Orban, in a speech we reported last year:

“ … around 2030, there will be a new power dynamic within the EU, because by that time the Central Europeans, we Central Europeans – who are treated in a way that I don’t need to elaborate on here – will be net contributors [to the European Union].”

Beyond the consensual calm usually exuded by the EU institutions, you can see some indications of the shape of the political battlefield to come.

Take the EU’s currently-defining policy, the enormously expensive and extraordinarily ambitious European Green Deal, which aims to achieve climate neutrality (and more Green besides) by 2050, through binding legislative targets. Alas, British officials and ministers are finding that such targets crush policy trade-offs and instead draw the state into defining more details in more areas, at the expense of organic development and diversity.

Most unusually, Poland opted out early on (while the Czechs and Hungarians were only just bribed to stay on board). The implications of this non-consensual behaviour for Poland’s energy policy to 2040 can be found here. And the best sentence:

“Poland will take the negotiation efforts to reform the European Union climate policy schemes in order to implement low-carbon and ambitious transformation, contribute to achievement of the EU objectives, with consideration to the temporarily increased use of the conventional production capacity and without bearing the excessive costs resulting from the climate policy.”

Which might be interpreted as Poland will burn more coal while it builds nuclear, renewable and non-Russian gas generation. And tries to get more money for this from Germany.

The pushback seems to be spreading beyond Poland: the Green Deal is a serious issue in Spain’s general election (voting on Sunday); it contributed to the collapse of the ruling Dutch coalition; and laws to explicitly reduce agriculture have themselves been pared back in the usually-enthusiastic European Parliament.

Reports of the forthcoming death of the EU are invariably exaggerated.

But the possibility of an end to the Franco-German progressive orthodoxy of this century looks a little more plausible.

Point of Order is a blog focused on politics and the economy run by veteran newspaper reporters Bob Edlin and Ian Templeton

3 comments:

TJS said...

A very balanced and analytical friend of Polish origin and someone I believe to be very intelligent told me that Polish people have something wrong with them.

I suspect Ukrainian people do too.

TJS said...

The push back on the green agenda seems inevitable as common sense will eventually prevail.

TJS said...

Does anyone have a spy camera into France? Since they shut down the internet everything has gone zip, zero, nada. Who's being killed, murdered and maimed where and how? Which side is winning, Macron, Gilets Jaunes, or radical Islam?