For the first time since the demise of the Soviet Union, Europe in Ukraine is facing the possibility of a new great armed battle headed by an atomic superpower, and nothing will ever be the same again.
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| [EU UKRAINE RUSSIA] |
For the first time since the demise of the Soviet Union, Europe in Ukraine is facing the possibility of a new great armed battle headed by an atomic superpower, and nothing will ever be the same again. The conflict is not limited to Ukraine, as they would have us believe: on the one hand, NATO, following aggressive American strategies, seeks to expand eastward directly on Russian borders, while on the other hand, Vladimir Putin's Russia seeks, in the name of security, to broaden its sphere of influence and neutralize neighboring countries, namely the former Warsaw Pact countries. In this conflict, Europe risks being crushed, particularly Italy, which relies on Russia more than other countries.
Faced with a clash between Russia and America in Ukraine (the second-largest European region after Russia, with 40 million inhabitants), the EU must decide whether to build an autonomous military defense force under the French atomic umbrella or to remain (almost) exclusively under the American umbrella, thereby necessarily following American foreign policy in all fields. As a result, he must decide whether to follow Biden's America not just in the conflict with Russia, but also in the economic and trade conflict with China. The issue is that the Middle Kingdom has the potential to become a powerful growth force for the European economy.
Europe must swiftly determine whether it wants to play an autonomous role in this situation of many clashes. President Macron of France is presently leading Europe's "strategy of self-sufficiency," which appears to have the support of Italian Prime Minister Mario Draghi. It is no coincidence that Macron indicated in a recent interview with the Economist that "we are seeing the brain death of NATO," and Mrs. Angela Merkel had previously warned that "Europe must begin to consider to shape her own future" in response to Trump's arrogant ultranationalism. It is now up to Olaf Scholz's new German administration to decide what to do in the face of the prospect of being cut off from gas supplies by Vladimir Putin's Russia.
Even the Draghi government recognizes that a conflict in Ukraine and a "non-agreement" on European security may grind the Italian economy to a halt. Europeans will have to decide whether to continue the "encirclement" of Russia on the Western front, risking a direct confrontation with the Russian military giant, or whether to agree with Putin on a new defensive pact that can guarantee the safety of both sides - which obviously is all - and the energy supplies necessary to supply European industries. In any event, European countries will have to make decisions that will result in a turning point in the EU, either positive or negative.
The EU has so far been successful in unifying the continental market, but it has failed at the monetary level, in the sense that the eurozone economy, particularly that of the eurozone's peripheral countries, has been undermined and held back by the eurozone's architecture and policies, and it was a complete political and institutional failure. However, a period of extreme discontinuity has now begun. It is apparent that at this moment, not only the idiotic Fiscal Compact regulations, but also the Maastricht criteria (limit 60 percent public debt / GDP ratio and maximum 3 percent deficit to GDP) have no practical basis and must be abandoned.
In the current circumstances, the EU cannot afford for a nation like Italy, which has a debt-to-GDP ratio of 150 percent, to fail, or for France, which has a debt-to-GDP ratio of 130 percent, to be in danger. Monetary and fiscal policy must continue to be expansionary, notwithstanding the fact that inflation will almost definitely remain over 2% for the foreseeable future. In Europe, inflation has reached 5%; yet, the source of the price rise is not an increase in individuals' buying power, nor is it the "crazy spending" for the welfare of public agencies.
This inflation is instead caused by an increase in energy prices, and raising interest rates in the face of this "cost inflation" would be suicidal: if the ECB raised the price of money, it would choke the economy and cause a chain reaction of unemployment and bankruptcies without even lowering inflation. In the face of a new prospective European catastrophe, there is at least one bright spot: austerity tactics will have to be abandoned in the face of an energy crisis and a security emergency. The "stupid regulations" of Maastricht will eventually be changed by European politicians. Otherwise, the EU and the eurozone will break up.