Two Agreements

This week the world saw two international agreements emerge, each as the result of a long and gruesome negotiation process in which one of the parties was under extreme pressure.  In Europe, Greece was forced to accept terms of a third bailout by the eurozone countries that are not only deeply humiliating but also all but guarantee that the same or worse problems will develop within the next three years.  For Greece the alternative was bankruptcy and in the short term significantly more economic pain than now has already been imposed on its population.  Apparently a ‘grexit’ was not feasible at this point in time, although in the long run that may be the only way for Greece to solve its problems.  In Vienna, where Iran negotiated with the rest of the world minus Israel about its nuclear program, a deal was reached that, if fully implemented, prohibits that country from developing a nuclear bomb in the next ten years and probably longer.  For Iran, lifting the sanctions that had crippled its economy was at stake, and if an agreement had not been reached there would have been a good chance that somewhere in the future Israel would have suckered the US into military action against Iran that would have started the third and most dangerous war in the Middle East in the last fifteen years.

But that is where the similarities end.  The European negotiations were characterized both by unwillingness to address the real problem, the fact that a common currency cannot work without financial redistribution mechanisms between the member countries of a monetary union, and by a total lack of leadership.  Instead of using the Greek debt crisis as a teachable moment for all of Europe and searching for ways to strengthen its political and economic integration all of the blame was put on the Greeks, whose frivolous lifestyle had caused all the problems according to the eurozone talking points.  The process was both vicious and petty.  It was obvious that Greece was being punished for having taken an initial offer to its voters, and therefore it had to accept much worse terms in the second round, and the effect of the pain that other European countries suffer under the economically unsound and thoroughly abusive German austerity dictate was mobilized against the Greeks: ‘if we have to suffer, why not they?’  By contrast, the American leadership role in the Iranian nuclear negotiations was impressive.   Against strong opposition by the Republicans, who even schlepped Netanyahu to the House chamber to sabotage the process, an agreement was reached that will make the world safer.

The Iran deal is not done, but it will be close to impossible for Congress to void it, since Obama will veto any such legislation and have the votes to sustain that veto.   Netanyahu will squirm, but unless he wants to commit political suicide by starting a war with Iran on his own he’ll accept the agreement.

If the eurozone countries don’t come to their senses, which is not to be expected as long as their fiscal and economic policies are set by a German who would flunk Economics 101 at any US university and is surrounded by ambitious yes-men from other countries, the European experiment is bound to fail.

The Iranian agreement will make the world a better place, and the gradual disintegration of Europe will make it more unstable.   It’s hard to predict if mankind will be better off because of the former or worse because of the latter, but on a day like this I’m proud to be an American and ashamed for Europe.

Hugo Kijne

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2 thoughts on “Two Agreements

  1. and on a day like this i regret not to be an american… well, let’s say, an american like krugman, stiglitz or obama… so, maybe, the member of a minority in the us of a…

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