Sloggers know how long the attack on Syria has been in the planning
Five months on from the anal gang-banging of Cyprus, the reasons for having done it remain multivariate but increasingly clear. The piece reproduced below is from March 23rd this year, and contains the following words:
‘…What very few people do for starters is just look where the hell Cyprus is. As you can see from this map, it is a long way east of Rhodes. That country it appears to be pointing a finger at is Syria. Just after that comes Iraq and Iran. A spit and a throw to the north is Erdogan-run Turkey. Every one of these countries is in one form or another the victim (willing or otherwise) of Islamist advance….I don’t think Barack Obama was in the region to talk about peace. He was doing the “I’m here to remind you all that I’m keeping a beady eye on this sh*t”.’
In the late hours of last night CET, Warplanes and military transporters have begun arriving at Britain’s Akrotiri airbase on Cyprus, less than 100 miles from the Syrian coast, in a sign of increasing preparations for a military strike against the Assad regime in Syria.
“We want a UN inspection,” warbles William Hague, “But if we get one, our American allies will say it’ll be meaningless, so I’ll agree with them – thus contradicting what I told everyone six days ago. And I’ll slip them free use of our Cypriot base….without asking for anything in return, because I’m still ToryBoyum Consultantfukwiticas. God Bless Yorkshire and America”.
So all those being asked to make a sacrifice here at home, prepare for Stage One of the Armageddon Show….yet another UK appearance somewhere we don’t need to be and can’t afford be, in support of “allies” that don’t give a toss what the ramifications for us will be.
Hague and Cameron are running the most amateur-night foreign policy since Michael Foot’s commitment to Unilateral Nuclear Disarmament.
The night Cyprus joined the euro….what goes up, must come down
What is the American State Department up to? What will Turkey do? Why didn’t things develop in Moscow? Where is Mario Draghi? WTF is this really all about?
How do you tell if a eurocrat is short-sighted? You ask him to spot the difference between a Russian billionaire’s pocket money and a Cypriot’s life savings.
That gag doing the rounds in southern Europe sums up the perfectly natural focus of most people in ClubMed: this is just more of the same old same old Brussels-am-Berlin bullying cock-up, followed by mealy mouthed denials and a screwed up financial system. As indeed it is. Put with less humour but equal bluntness is this verdict from the OECD Director General’s adviser Adrian Blundell-Wignall:
‘The Cyprus crisis is the result of policy mistakes and a failure of collective responsibility, as well as an illustration of what bad policy can do and could do if it’s not corrected.’ Quite. But not everyone is as stupid as they pretend to be.
Type ‘Cyprus’ and ‘Putin’ into The Slog’s search engine, and you can see that this small island is, and always has been, of pivotal strategic importance in relations between Europeans and Arabs. The energy and rare-earth mineral finds of recent years have merely accentuated what was already a place of obvious military importance: access to the Med for Moscow, and a jumping-off point for the US and its obsessive concern with securing energy supplies and the ever-more tenuous Al Qaida.
What very few people do for starters is just look where the hell Cyprus is. As you can see from this map, it is a long way east of Rhodes. That country it appears to be pointing a finger at is Syria. Just after that comes Iraq and Iran. A spit and a throw to the north is Erdogan-run Turkey. Every one of these countries is in one form or another the victim (willing or otherwise) of Islamist advance.
Since 9/11, the so-called War on Terrorism plus Peak Oil theories have had the Americans in a fit of manic focus on this entire area.
Erdogan has always wanted Cyprus ‘back’ (although it was never his in real terms) but more especially he wants the energy fields reconfigured to favour Turkey. Being a NATO ally, he is more than capable of making this mess even more complicated – and the Turks confirmed two days ago that they’d challenge any move by Cyprus to speed up offshore natural gas exploration. Yet there seems to be no pressure from NATO to shut Erdogan up. Why?
For Moscow, the stakes are very high both strategically and in relation to the energy reserves.
In a number of key areas of the region, one of the biggest prospectors in Noble Energy. Former employee Jim Cramer explains:
“…about the nexus between the Cyprus bank bailout deal and the natural gas and oil development in the western Mediterranean…I believe there are some places where these two seemingly unconnected events meet. Since 2010, Noble Energy has been on the front line in exploring the massive Levant basin, including large potential deepwater fields located in both Israeli and Cypriot waters. At every turn, enthusiasm has grown, and it is now thought that the many fields inside the Levant basin could change the natural gas supply dynamic in the entire Western Mediterranean, including both Greece and Italy. Eastern Europe has been forced to depend exclusively on very undependable Russian gas supplies, periodically cut by the Russians dependent upon prices and their own national demand, as well as their national interest. But the now-nearly ready supply from the Leviathan and Tamar fields might begin to break that Russian hegemony. The Tamar field will begin production in April, promising more than a 1 billion cubic feet a day of natural gas, a small but important start….”
So here is a way for Moscow to escape into the Med, have a finger in both energy pies, and avoid being stitched out of its all-important energy-supply business. But also here is an American company leading the charge. What we haven’t seen is any evidence of the US State Department getting heavy with Brussels, Berlin, or Moscow in public.
Even more mystifying (although there were cold Muscovite feet from the start of the the Russo-Cypriot bailout talks) the sessions came to nothing: Russia walked away. Why?
The EC itself is now admitting (a rarity in itself) that this the Cyprus bailout offer was a cock-up. But the ECB has delivered an ultimatum (anyone remember there being a vote on that?) to Nicosia saying ‘Monday is it guys: if you’re in fine, if you’re not, you’re broke’. Yet of the most powerful financial officer in Europe, Mario Draghi, there is no sign: nothing, in fact, since March 7th. Why?
Former Foreign Minister and losing Presidential candidate of Cyprus George Lillikas said Wednesday last that he was certain a Cypriot eurozone exit would lead to the collapse of the single currency. “I am sure that if one country, no matter how small, leaves the eurozone, the euro will collapse,” he said, “but the troika’s suggestions of imposing a tax on deposits in Cypriot banks would destroy the island’s banking system”. As indeed it would. Yet Berlin turned up the heat on Cyprus yesterday, increasing the amount Nicosia must raise to secure a bailout…despite the mortal injury that Cyrpriot exit could inflict on the eurozone via a mélange of rebellion and financial contagion. Why?
This leaves us with a number of questions to answer. And you must, I’m afraid accept most of what follows for what it is: informed speculation. I’ve been given some steers and hints along the way, but nothing concrete.
I think there’s every reason to suspect that the US is giving Turkey a long leash, because it needs Turkey as a base (and a suitable place to invent fictitious crap about Syria) through which it can neutralise first Assad and then Iran. The American strategy is clear: support the Sunni Muslim Brotherhood against the Shi’ite Iranians and Alhawite Syrian élite, and thus secure energy access throughout the Middle East. As so often with the US, the policy is naive, its consequences haven’t been considered enough, and it has no basis in terms of how the Sunnis will run things as and when Assad finally loses. But America is ultimately selfish in foreign policy, and paranoid about energy and raw materials.
That reality may also partly explain why the US State department has been surprisingly private about this whole affair. There are some who will tell you that the long term Pentagon aim for Cyprus is a shared hegemony over the place with Turkey. So a weak Cyprus in hock to the EU might suit both very well. It would also, of course, remove the legal obstacle Brussels would face in having two members, both claiming the island as theirs. But whatever the EU says in public, several key members remain implacably opposed to Turkish entry.
The bigger mystery at first sight is why Putin looked this gift-horse in the mouth. I think there is probably far more to this than Moscow simply being unwilling to clear up the mess created by Brussels-am-Berlin. At a total bailout cost of €18 billion – small change for Russia these days – the Kremlin could’ve broken out from its perceived encirclement and neutralised any EU/US attempt to stitch it out of new energy reserves. In purely geopolitical terms, this looks like an act of completely myopic idiocy.
But there are other important factors. The Mafia/oligarch axis in Russia is virtually indistinguishable from the energy sector. They might get control of the sub-ocean finds – but they might not. If they didn’t – with Nicosia and Putin heavily involved – then their control over the Russian economy would be reduced. It’s likely that the top blokes applied pressure to the talks on that basis.
The Kremlin was also worried about the British naval presence on Cyprus. They seem to have seen the deal as rather like buying a low-priced house with sitting tenants already in place: it isn’t really your house until they leave. In a military dimension, that sort of thing is very important.
Finally, it is clear that Moscow doesn’t trust Anastasiadi, seeing him virtually as an enemy. Allegedly, at the outset of the discussions very little seemed to be on offer from the Cypriots, and this convinced more than one on the Russian side that Nicosia wasn’t serious: that it was using Moscow’s interest as a bargaining tool against the EC. Others in turn pointed out that the bailout amount seemed hazy (as I showed yesterday, it was worked out on the most facile of bases) and likely to pave the way for more debt until Cyprus became a money pit. On the other hand, a Cypriot source thinks the Russians were never serious either, and wished only to wind up the West.
I still find much of this hard to rationalise. It is just possible that Russia no longer sees military attack as the best way to influence events, so the Med has a lower strategic importance for them: that energy and cyberspace are better weapons. That’s what one source in Washington thinks. I’m not convinced.
The mystery of Mario Draghi the Invisible Man is more disturbing in some ways. I posted about Schäuble briefing bigtime against him the week before last, and I now think it boils down to two serious possibilities. The first is that Berlin has somehow neutralised the ECB boss, and told him to stay out of public and leave it to them. If so, he has managed very well to be AWOL during a classic Brussels-am-Berlin cock-up. But even as the ECB demanded a Nicosia decision by Monday and then demanded more money after the Moscow talks broke down, SuperMario was nowhere to be seen. That is odd.
The second possibility – and one I increasingly favour – is that from the outset Mario Draghi saw Cyprus as a distraction, no more: he knows that via his control over the banking purse-strings, he can bring the island to its knees any time he likes. Either he knew (or guessed) that the Berlin mentality would jackboot into the situation and use it as a test-case for (a) future events where threats are felt to be necessary and (b) setting the precedent for State theft of depositor funds under the guise of bollocks like Open Bank Recontruction (OBR) or fantasy ‘levies’. Of course, he would prefer to be away from that grubby operation, but I return to the key word here – distraction: Germany’s aim is control; Draghi’s aim is the survival of the euro, whatever it might cost. The two need not be the same, and in the long term probably won’t be.
I have heard but one rumour about what is distracting Draghi, but that’s all it is. I can however say with near-certainty he has been genuinely busy in recent weeks on the subject of eurozone exports.
In almost his last public appearance just over a month ago, ECB President Mario Draghi tried to take the heat out of the currency wars debate by dismissing it as a fantasy. That always makes my nose twitch: when any top Wally says never, unique, impossible, poppycock or fantasy, you know you’re onto something. And while Mario worked hard to rubbish the idea, he did quite openly say that the ECB would “still have to assess the economic impact of the euro’s strength”.
His chief concern at the moment is high costs making eurozone exports uncompetitive. This problem doesn’t seem to afflict Germany, but it is at base the fundamental problem with the euro: you can’t devalue it here and revalue it there. It’s all or nobody, as it were. Devalue the whole eurozone currency, and it may help ClubMed for a while: but in the medium term, it will make things even easier for Germany to get richer and richer. Draghi does not, in private, want that at any cost. What he wants is an efficient EU ensuring a stable, respected currency.
While there’s no doubt that on balance the ECB would like a cheaper euro (another reason to have left Germany alone to f**k up the Cyprus bailout?) Mario’s ideas are far more focused on cost reduction in the real world of manufacturing: and the biggest single way to do that is to drive down wages.
Two weeks ago, the ECB boss made a late-night presentation to senior eurocrats and europols about the twin issues of productivity and wages. Six years ago Germany went through the studied process of maintaining a voluntary pay freeze. Draghi thinks the rest of Europe must follow suit, but ClubMed workers tend to be less obedient than Shop Floor Fritz. He has not, in fact, been neutralised by Berlin: he is supporting Berlin’s plan to provide cheap labour working longer hours, but via another, less public, method: helping to make people desperate.
The toughest immediate challenges ahead now are Italy and Spain. Both countries have powerful leftwing Parties unwilling to put up with much more austerity. Draghi’s opinion is strongly towards easing off on the cuts, finding the money for stimulus, and lowering the expectations of those re-entering the job market. It’s a tough circle to square, but he’s on the case.
Equally, Spain, Italy and France could soon find themselves at the epicentre of a european bond market panic…especially if Greek default becomes more likely (it must) and Italian rebellion gains speed (it will). As I reported some time ago, Mario Draghi is keen on the idea of using gold as a bond-backing instrument to overcome this. That’s no easy task either.
The point is this: Draghi may have had his own career reasons for being off the set during the last fortnight. But thinking about it in the round, he is clearly very busy. It may add up to no more than that. Personally, I suspect that what he plans to do adds up to yet another form of citizen pauperisation alongside the bank robbery approach. I think it is bound to make things worse, but there you are: what do I know?
And so the final question sets itself really: peering out from the helicopter, WTF is going on here? I think there is one further possibility. You may have noticed that President Obama conveniently turned up in Israel this week, talking airily about peace – in that rhetoric-dominated manner he adopts when there’s no beef in the sandwich. In fact, he got Netanyahu to utter some encouragingly nice bromides about America as an ally and the bonds of friendship being unbreakable and so forth. I don’t think Barack Obama was in the region to talk about peace. He was doing the “I’m here to remind you all that I’m keeping a beady eye on this sh*t”.
There is a theory that runs like this. The commitment to Berlin remains strong in Washington, as the only place likely to sort out the eurozone disaster. Merkel’s husband is extremely well-connected in the American security sector. State under Hillary Clinton made it very obvious she was “betting the farm” on Germany, as indeed did Timothy Geithner. Both sides now have a vested interest in a supine ClubMed in general (less threat to Wall Street) and Greco-Cypriot weakness in particular (the EC remains dominant, Berlin gets tough on the euro, the Americans retain their access to mining, energy and military bases, the Russian monopoly on gas supply is broken). That also, of course, suits Turkey.
This may very well be how the interested parties see it. Erdogan mouths off and gets to look macho, Schäuble plays hardball and gets another one over Draghi, and the US President turns up to remind everyone who’s really in control here. I cannot believe that these NATO allies didn’t at least discuss some of the possible outcomes beforehand. Thus I would also assume that all this – and the dangers of messing with it – will also have been politely explained to Moscow. There may even have been a carrot on hand if necessary.
The total picture on Cyprus is on three main levels: Brussels-am-Berlin mendacious control to blame austerity’s failure on nasty billionaires, lazy Greeks, and dumb Cypriot potato-heads; Washington-am-Berlin geopolitical power games; and a deregulating financial élite working along side Major League politicians to find ‘solutions’ to the problems they themselves created. This last dimension is the one I think the most significant: if the Berlin-dominated EC decides it wants a power bulwark against Russia, China, the US or whomever, there’s nothing I can do to stop them, and there are plenty of ways to avoid the effects of it. I’m British, and sixty-five years old. I’ll continue to try and wake people up to it, but I’m past the barricades stage of life. Ditto the likelihood that US Friedmanite mercantilism will wind up blowing us all up. But in the end, most power and almost all misery stems from money.
It’s very clear now – and the catalyst here has indeed been the Cyprus crisis – that most developed countries have a plan in place for buying their way out of self-inflicted trouble, and that we aren’t going to even loan them the dosh: they’re going to find ways to cut out the middle men (the Revenue services) and simply steal it from our bank accounts, bond investments, gold punts, interest on capital, dormant accounts and so forth. What RBS has been doing to SMEs for the last four years is going to happen globally to all of us…..unless we resist. Confirmation of this is, in my view, the main by-product of Nicosia’s collapse at the prospect of Berlin smash-and-grab.
Without money, States cannot fulfil their objectives. On the other hand, money does get people off the sofa in the end. On those encouraging bases, I foresee some change of focus for The Slog from here on.