The Left is Back in Greece

Shockwaves have rippled throughout Europe as the anti-austerity party, Syriza romped to victory in the elections held in Greece on Sunday. Alexis Tsipras, the leader of Syriza has promised to renegotiate the bailout terms with Greece’s international backers known as the Troika (a coalition of Eurozone countries, the International Monetary Fund and the European Central Bank). His aim is to end the devastating austerity that has caused the Greek economy to experience near perpetual recession for the past six years. When asked what Syriza’s victory meant, Tsipras responded “the vicious cycle of austerity is over.”

Following the financial catastrophe of 2008, Greece’s debt became a massive problem for government finances. Greece needed to borrow money to keep the country running, but was unable to borrow from the banks due to the extortionate interest rates it was being charged. To save the Greek economy from collapse the Troika offered the Greek government a bailout. In exchange the Greek government would have to slash spending by huge amounts to balance its books. However this was the wrong time for austerity, private spending was already low due to the crash, so government spending was required to keep the economy afloat. Unfortunately the terms of the bailout resulted in plummeting private and public spending, creating a vicious cycle of decline. As many Greeks lost their jobs or had their pay cut, government tax revenues went down and welfare payments went up. However since the government was required to try and balance its budget, this created a bigger imbalance and forced further cuts. This meant less money in the economy, so more people were made unemployed, which in turn made government finances even worse off.

No wonder people voted for the most viable anti-austerity party; Syriza.

In the election Syriza managed to win 36.4% of the vote and 149 seats (just two short of a majority) compared to 27.8% and 76 seats for New Democracy, the senior party in the ruling coalition. This victory for Syriza is a line in the sand for both Greece and Europe. It has shown what will happen when you unleash harsh austerity on your people. Greece is far from unique, in Spain the anti-austerity and left-wing party Podemos was leading in the polls at the end of last year, despite only being founded in January! It also serves as a warning to establishment left-wing parties across Europe, including Labour hear in Britain. The rise in popularity of Syriza has been possible thanks to the collapse of the establishment left-wing party, Pasok. It entered into a collation with the conservative New Democracy and helped to unleash the austerity Greece has had to undergo. Other establishment left-wing parties should be wary before carrying out similar programs back home.

It is a new day in Europe, what happens next with Greece will decide the fate of the European integration project that is the European Union.  

Syriza supporters celebrate following victory in the election
Souce: BBC

UKIP in the Ascendancy?

Nigel Farage has called the result an “earthquake in British politics” as his party charges into first place with almost 30% of the vote and 24 seats. Yet is this result, in a European election with a 34% turnout, an indication of the 2015 General Election? The answer: Not if history is anything to go by. Nobody is claiming that UKIP will beat the Tories or Labour in next year’s election, not even the party itself, the question is will it gain any seats, and if so, how many?

Remember back to 2009 when UKIP placed second in the European elections with 16.5% of the vote? Everyone predicted that in the 2010 General Election that UKIP would gain some seats in the House of Commons, especially considering voter hostility to both Labour and the Tories. Well in 2010 UKIP didn’t gain any seats and only received a paltry 3.1% of the vote. Obviously a lot has changed in five years, but I doubt Farage will cause an earthquake when the results of the 2010 election are revealed.

There was some good news though, support for the BNP crumbled into nothing! In the 2009 European elections the BNP managed to gain two MEPs, Nick Griffin in the North West and Andrew Brons in Yorkshire and the Humber. This time around both MEPs were handily defeated.

The Greens had a reasonable night, although their share of the vote actually decreased slightly they managed to gain one seat. This is particularly th

anks to the implosion of the Lib Dems, who slipped into fifth place and lost 10 of their 11 seats. This result, along with their obliteration in the council elections has meant many in Nick Clegg’s own party calling for his head.

Party	Vote	Change	Seats	Change	Pro or anti EU
UKIP	27.49%	+10.99%	24	+11	Anti
Labour	25.40%	+9.67%	20	+7	Pro
Conservative	23.93%	-3.80%	19	-7	Mixed
Greens	7.87%	-0.75%	3	+1	Pro
Liberal Democrats	6.87%	-6.87%	1	-10	Pro
SNP*	2.46%	+0.34%	2	0	Pro
Plaid Cymru*	0.71%	-0.13%	1	0	Pro
BNP	1.14%	-5.10%	0	-2	Anti

*The percentage of the vote is when you take all of Great Britain (not Northern Ireland). In Scotland the SNP got 29% of the vote and in Wales Plaid Cymru got 15%. 

Undoubtedly Eurosceptics did quite well, but the result was not as Eurosceptic as you might have been lead to believe. 42% of people voted for pro-EU parties, 31% for anti-EU parties and 25% on parties that have mixed attitudes to the EU.

A Victory for Euroscepticism?

So the results are now in, but what do the results of the European Parliamentary elections mean?

Well they are certainly the most important elections that the EU has held since voting to the European Parliament began in 1979. Eurosceptic parties did well across the continent, but in particular they did well in Greece, Italy, France, Britain and Denmark. In Greece the radically left-wing (and Eurosceptic) SYRIZA won the largest amount of seats whilst the neo-Nazi Golden Dawn won three seats. In France Marine LePen’s National Front managed to place first. In Italy Beppe Grillo’s Five Star Movement came in second to the pro-EU Democratic Party. In both Britain and Denmark Eurosceptic parties managed to beat out pro-EU left wing rivals to the top of the podium. Note: I will be doing separate posts on Greece, France and Britain, so I won’t write about them anymore in this post.

A lot of the media attention has been on the success of the far-right, but thankfully it has been largely exaggerated. In Hungary the neo-Nazi party, Jobbik, was hoping to increase the amount of seats it held in Europe from three. Fortunately it was unable to do so and in fact their share of the vote declined very slightly from 2009 (-0.48%). In Britain support for the BNP crumbled into nothing, France’s National Front isn’t truly far-right anymore. The only real success the neo-Nazis got was in Greece where Golden Dawn managed to gain three seats.

It is extremely important to note that the four largest European Parliament groups are all pro-EU and together they received 63.6% of the vote and 498 of the 751 seats in the European Parliament. Although the Eurosceptic parties did have their best night in European election history, don’t be fooled into thinking that they did far better than they actually did.

Parliamentary group	Vote	Change	Seats	Change	Pro or anti EU	Countries
EPP	24.2%	-8.33%	208	-59	Pro	12
S&D	24.4%	+1.62%	186	-2	Pro	5
Liberals	7.6%	-2.47%	58	-23	Pro	4
Greens	7.4%	+0.02%	46	-9	Pro	1
Left	6.1%	+2.09%	42	+7	Anti	1
EFD	5.2%	+0.28%	38	+9	Anti	2
Conservative	4.2%	-0.65%	45	-11	Mixed*	0
Other	21.0%	+7.45%	117	+88	Varies**	1

*They wish to repatriate powers from the EU, but do not wish to withdraw from the EU.

**As it is not a parliamentary group, the parties in this category do not have a defined political opinion. Yet most of the parties in this category are Eurosceptic.  

The Anti-EU vote includes all of the Left, EFD,
Conservatives and other

The difference between the 2009 and 2014 European elections
Colour represents the country's largest delegation
Purplish red - Left
Red - Socialists & Democrats
Light blue - EPP
Dark Blue: Conservatives
Purple: EFD
Green: Greens
Yellow: Liberals
Dark Grey: Even split or other

Ukrainian Crisis Approaches Boiling Point

The crisis in Ukraine has continued to get even hotter over the past week despite attempts by diplomats to secure a peace deal.

Eastern Ukraine has a large proportion of ethnic Russians, and many Ukrainians who are supportive of Russia. This is why the Kremlin has moved its focus from Crimea to the rest of eastern Ukraine. The series of events which resulted in Crimea joining Russia has begun to play out across the east. Armed men have taken numerous government buildings, erected Russian flags and demanded that they be allowed to join Russia. Just like the armed men in Crimea they are too well-organised to simply be pro-Russian locals. Rather, they are mostly members of the Russian armed forces. Of course Russia denies that the militia are connected to the Russian military, but they made the same statements about the militia in Crimea and have since admitted that they were actually Russian soldiers.

Yet, as I have said in my previous posts, these areas are not like Crimea. They are not majority Russian and hence the Ukrainian government will put up more of a fight for control of the region. Already Kiev had sent troops in to take some key positions back from the Russians.

Despite the chaotic situation in the east, there did seem to be some hope that a peaceful solution might actually be reached! The governments of Ukraine, Russia, the US and EU reached an agreement in Geneva. The agreement called for the dissolving of all illegal military groups, amnesty for all anti-government protesters and that the militias that have taken control of government buildings must leave them. Unfortunately that deal seems dead in the water as one of the spokesmen for the separatists has said that they are not bound by the deal.

This all plays perfectly into Putin’s hand; he gets to look like a sensible diplomat whilst continuing to destabilise eastern Ukraine through these separatists. If you want any more proof that Putin is planning on take eastern Ukraine, all you need to do is watch the press conference he held earlier this week in which he referred to the eastern parts of Ukraine as “new Russia”! If that isn’t a clear sign that he plans to go even further into the territory of Ukraine, I don’t know what could be!

We Need to Talk About Appeasement

When Russia took Crimea from Ukraine the West responded with shock. The reaction in Eastern and Central Europe was very different, for years leaders in those countries had warned that Russia had never lost its imperialistic ambitions. Fear is particularly rife in the Baltic States who, bar a brief period of independence between World Wards, spent several centuries under the rule of Russia.

If we look at demographics they may have a reason to fear Russian aggression. Estonia and Latvia have sizeable ethnic Russian minorities, particularly in the east of their countries. The county of Ida-Viru in north-eastern Estonia is over 70% Russian, even more ethnically homogenous than Crimea! When Putin decided that he was going to invade Crimea he used the excuse that he was only doing it to protect Russians from the new government in Kiev. In Latvia, Russians are frequently treated like second-class citizens. Perhaps Putin could use this as a pretext to invasion?

Yet there are massive differences between Ukraine/Crimea and the Baltic states. The origins of the Crimean Crisis is the debate of whether Ukraine should tie itself closer to Russia or the EU. There is no such debate in the Baltic States, all three are members of the EU and NATO and are fully within the Western fold. Membership of NATO is of key importance here, no sovereign nation has invaded on of its members since its formation in 1949.

Another difference between Ukraine/Crimea and the Baltic states is of demographics and population. Estonia and Latvia have the highest proportions of ethnic Russians of the former USSR with 24.8% and 26.9% respectively. Compare this to Ukraine which has ‘only’ 17.3% ethnic Russians. But comparing country-wide percentages is not being intellectually honest. Russia has not invaded all of Ukraine, only Crimea. In Crimea 58.8% of the people are Russian. The population of these states is also important. Crimea has a population of 2.4 million, larger than both Estonia (1.3 million) and Latvia (2 million), only Lithuania with a population of 3 million is larger than Crimea. Lithuania has also got far fewer ethnic Russians, who make up only 5.8% of the population. There are more Russians in Crimea than the three Baltic States combined. The Estonian county of Ida-Viru has only 140,000 people in it. Would Putin really risk war with the West over an insignificant Estonian county? (no offence people of Ida-Viru county) When looking at the Baltic States Putin would be forced to do a cost-benefit analysis. He would then find the potential costs way too high and the benefits too few. It would seem inconceivable, but Putin has proved to be unpredictably before and will likely be so in the future.

So if the Baltic States will not be his next target, what will? The most commonly talked about are eastern Ukraine and Moldova.

Moldova is a small, landlocked country sandwiched between Ukraine and Romania. The fact that it does not border Russia, or even the sea, makes it seem strange that it might be the next flashpoint in a new Cold War. The fact that only 9.4% of Moldova is ethnically Russian further confuses the situation. Yet, as was the case with Ukraine, the problem is only part of the country. When Moldova seceded from the Soviet Union in 1991 the eastern portion of Moldova, Transnistria, seceded from Moldova. Although no UN member recognises the independence of Transnistria, it has been de facto independent for over 20 years. Another key issue is the demographics of the pseudo-independent state, it is roughly evenly split between Moldovans, Russians and Ukrainians (32, 30 and 29 respectively). Unlike the Baltic States, Moldova is not an EU or NATO member and hence is not well protected from foreign aggression.

Yet the major problem with invading Transnistria would be how could they get there? The most likely scenario would involve going through Ukraine and possibly Moldova. This could further destabilise the situation in Ukraine, especially since it would put Russian troops extremely close to Ukraine’s 4^th largest city, Odessa. Once they had control of Transnistria there would be the issue of what to do next? To move in/out of Transnistria would involve going through Ukraine, or Moldova and Romania. Considering Russia would have violated the sovereignty of the former two, they would be unlikely to willingly help Russia. Another option would be to take more territory, considering Putin’s actions already, it is not unthinkable. One issue that could prevent Russian action in Transnistria is the reaction that the rest of Moldova would have. Moldova is hoping is one day enter the European fold, Russia violating their sovereignty would likely cause them to seek closer ties with Europe sooner.

So if Transnistria is unlikely to happen, what really are the chances of Russia invading eastern Ukraine? As I have explained previously, no Ukrainian Oblast has more than 40% ethnic Russians (other than Crimea). Yet who says that Russia has to take an entire Oblast, perhaps just part of it. The city of Donetsk is 48% Russian, could Putin decide that he would likely to take that city?

Assigning probabilities is pointless as it all depends on how the West acts going into the future. If the West does nothing then the chances of Russia taking action in Transnistria, eastern Ukraine or the Baltic states would increase. If Putin does go further and the West does not take military action then we are taking about appeasement. I know accusing Putin of acting like Hitler seems drastic, but it is true. Hitler took Czechoslovakia and Poland to ‘protect’ ethnic Germans. If Putin takes Ukraine and Moldova to ‘protect’ ethnic Russians then how is he any different?

Horrific Violence in Ukraine

Violence has descended upon the streets of Ukraine once more, as clashes between police and protesters worsened. So far 26 people have been killed, 14 of them protesters and 12 police.

This is absolutely horrific, especially considering that just last week there were hopes of a deal. Protesters had agreed to leave some parliament buildings, in exchange the government would grant amnesty to the protesters. At the moment we don’t know whose fault it is for the violence, as both sides blame each other. Yet in the ensuing chaos it’s pretty clear that the government side has acted a lot worse. They have repeatedly broken promises they made and even set a building on fire, forcing people to jump out of buildings to escape the flames!

It was hoped that a truce agreed yesterday would give the politicians a chance to agree to something more long term. Unfortunately that truce has broken down thanks to the government. It didn't even last 24 hours! Today alone at least 17 protesters have been killed according to the BBC! This raises the total killed this week to 43, 31 of them protesters.

The only way out is for fresh elections, and if the government wins then I would be in favour of ending the Euromaidan protests. The current president, Viktor Yanukovych, won the highly dubious 2010 election with barely 3% more than his opponent. Some people would argue that as he won that election, that the protesters should simply wait until the next election in 2015, after all he was democratically elected! The problem with this argument is that Ukraine is not a stable democracy like Britain or America. This makes it more vulnerable to destruction. Four years may not appear like enough time to turn a democracy into a dictatorship, but remember: it only took Hitler two.

Thankfully the West has decided to act, America is preparing to impose sanctions and the EU is probably going to in the next few days. This has angered the Ukrainian and Russian governments who hope to crush the opposition. Russia’s foreign ministry blamed the West’s “conniving politics” for the protests. The great irony is: it was Russia’s ‘conniving politics’ that was the cause of the protests in the first place!

One of the many injured people
Source: BBC

What the World Holds in 2014 - A Prediction

So that’s my review of 2013 over, obviously there were numerous stories that I missed. The horsemeat scandal that gripped Europe, elections in Japan and Germany, and the birth of Prince George. The biggest news story that I missed was documenting the progress within Iran. I was planning on writing more reviews, but revision for exams has cute into the amount of time I can afford to spend blogging. Perhaps when I finish exams I’ll do a few more reviews of 2013.

The point of this post is to predict what will happen to the world in 2014. The number in red is the amount of predictions I’ve made in the paragraph.

Pro-gay rights athletes will be arrested in Sochi during the Winter Olympics. Of the 100s of athletes attending, it seems unlikely that nobody will protest. Expect tensions to rise between the West and Russia. [1]

The European elections will be a mixed bag as the likes of France jump to the rights whilst Britain and several other countries jump to the left. I predict that Nick Griffin will lose his seat and Labour will have the largest MEP delegation from Britain. In France Nicolas Sarkozy’s UMP will have the most MEPs, followed by Marine Le Pen’s National Front. This will leave President François Hollande’s Socialist Party in third place.  [5]

Scotland will vote to remain in the union, although the vote will be closer than most unionists would like [1]

Scotland will also legalise same-sex marriage, as will Luxembourg and the Faroe Islands. Michigan and Virginia, by court ruling, will legalise same-sex marriage through the courts, whilst Ohio and Oregon will legalise it through ballot initiatives. The Supreme Court will reject Utah’s appeal, keeping same-sex marriage legal in that state. [8]

The November elections in the US will be mixed. Republicans will make a net gain in the Senate but will fall short of enough to take control. Little will change in the House of Representatives. Democrats will make a net gain in the governorship. [4] I’ll do a more in depth post about this later this month or in early February.

The bloodshed in Syria will continue, and by the end of 2014 nothing much will have changed unfortunately. There will be no Western military intervention in Syrian affairs. [2]

Obamacare will become more popular as its positive effects are felt. By the end of the year it will have a positive approval rating [1]

Senator Elizabeth Warren of Massachusetts will continue to gain popularity within the Democratic Party. She will eat away at Hilary Clinton’s lead in 2016 polls. New York City Mayor, Bill deBlasio, will gain national attention, also resulting in him being touted for a 2016 Presidential run. [2]

If I were to guess one person who is likely to die in 2014, I would chose President George H.W. Bush. We already know that he is in poor health and turns 90 this June. People who could also die this year include the Duke of Edinburgh, after all he turns 93 this June and had a number of health scares in 2013. Thailand’s King Bhumibol Adulyadej has had numerous health scares over the past decade and hence is also on the list of likely deaths. He turns 87 in June (I swear I have nothing against people born in June). Aging stars Bruce Forsyth (turns 86 later this month) and Betty White (turns 92 next month) could also die in 2014 without much surprise.

Excluding deaths, I have made a total of 23 predictions for 2014. I guess we will have to wait until 2015 to see how accurate they were!

Ukraine Should Remind us that the EU is Still Important

The EU has not had a great few years, the Euro currency has been in constant pain since the economic crisis of 2007-2009. The wealthier Euro nations such as Germany, Netherlands and Finland have had to support the appropriately named ‘PIIGS’ countries. All across the EU euro-scepticism is rising with the likes of the National Front in France and UKIP in the UK. You might think that with all that pain on the inside, non-EU nations would be hesitant about creating closer ties with the organisation. Especially when there is a viable alternative.

It will then come as a surprise to you to learn that there is a country in which pro-EU sentiment is strong enough to spark a revolution! That country is Ukraine.

The EU has eyed Ukraine as a country that it wishes to create closer bonds with. As part of the European Neighbourhood Policy it was trying to get Ukraine to sign an Association Agreement, so long as it implements certain reforms. The major problem was that the agreement is opposed by Ukraine’s ally, Russia. The President of Russia, Vladimir Putin, really hates the deal as he wants Ukraine to join the Eurasian Economic Community of five former Soviet States and eventually the customs union that includes only Russia, Belarus and Kazakhstan. The strong opposition from Putin caused Ukrainian President Viktor Yanukovych to refuse to sign the Agreement on the 29^th of November as he was supposed to. This sparked fury in Ukraine.

For the past ten days people have protested in cities all across Ukraine, but particularly in the capital, Kiev. The Ukrainian people have grown fed up with the historic influence of Russia and the Kremlin. They wish to leave its bitter embrace and join with Western Europe, in the hopes of some fresh air. The statue of Lenin in Kiev was torn down yesterday, as it was seen as a symbol of Russian oppression. It was replaced with the European Union’s flag – now a symbol of hope and democracy in the poor Eastern European country.

This is not the first time Ukrainians have taken to the streets to protest against Yanukovych. In 2004 he won a highly disputed election that resulted in mass demonstrations and the election being annulled. In the second election Yanukovych was easily beaten by his opponent, Viktor Yushchenko. The Orange Revolution, as it was later called, should have served as a warning to Yanukovych that if he messed with the Ukrainian people, then he would pay a high price.

It is difficult to say whether these demonstrations will actually cause a change in government, but they nonetheless show that the European Union is still important. To many people living in well-established democracies like the United Kingdom and France, the EU has outlived its usefulness. Founding it was meant to make war impossible amongst the ‘Great Powers’ of Europe, and in that it has succeeded. Yet to those who live in fledgling democracies, which could fail at any given moment, the EU is a beacon of light. It is something that they can work towards and will help stabilise their countries. It is something that has proven to bring economic well-being to the less advantaged nations. Ireland, Greece and Portugal may seem to be in a bad economic situation now, but it is still better than what it was in their pre-EU days. If the countries that did not ‘need’ the EU were to leave, you would find a significantly weaker EU, one that could not help the nations that need it.  

The Old World Order - Europe

Population: 738 million
Area: 10 million km2
GDP: $18.7 trillion
GDP (per capita): $25,000

Europe is difficult to review as it is a continent rather than a country. Last year when I reviewed Africa I hadn't reviewed any countries within Africa. This time I have already reviewed four European nations. Undoubtedly Europe has been at the centre of international relations for the last several centuries having owned (at different times) all of the Americas, Africa and Australasia as well as most of Asia. The future looks problematic for Europe, its facing population decline and much of its resources have already been exhausted. By 2050 Europe's population will have declined to 677 million people. Much of Mediterranean Europe is in financial chaos, pulling the rest of Europe in. But all is not lost. The EU has the world's largest economy of $17 trillion, four countries of the 10 in terms of military expenditure are in it and two have veto power in the UN. Parts of Eastern Europe are also still quite poor, which sounds bad but means there is plenty of room for European GDP to grow.

Europe can also be a model for peace and democracy. I believe that the last wars in Europe took place in the former Yugoslavia. We may finally have gotten rid of war in Europe. Freedom House 2013 reports of 46 European nations, 37 were designated free, seven were partly free and only two were not free. With several of these less free countries moving forward, Europe could be the first continent to only have democracies that are truly free.

Old World Order - Italy

Population: 61 million
Area: 301,000km2
GDP: $2.2 trillion
GDP (per capita): $33,000
United Nations Security Council Veto: No

In the late 1800s the Italian mini-states and city states were unified by the Kingdom of Piedmont into one country. The newly unified Italy was immediately powerful and over the next 100 years expanded its influence and power. Italy ended up on the right side of WWI, but thanks to the leadership of fascist Mussolini, was on the wrong side of WWII. In the years immediately following WWII the Italian economy grew very well, and although it had lost influence, still did rather well as a country.

The Italy of today is still relatively powerful, although not a great power. It has the 10th largest military expenditure in the world and the 8th largest economy. As in the case of Germany, Japan and France, a problem for Italy in its future is population decline. Currently Italy is the 23rd largest country in the world with 61 million pepole, by 2050 that is expected to have shrunk to 60 million people making it the 29th largest. This decline puts huge pressure on Italy, as time goes by its working population will decrease whilst the retired population will increase. This will mean more people will be collecting pensions and put more pressure on healthcare whilst tax receipts will decline as there are fewer people working.

Politics in Italy is also problematic as it is by far the most corrupt of the nations I am reviewing. Italian politicians of all sorts get generous pay cheques, the mayor of Bolzano (a city of roughly 100,000)gets paid more than Barack Obama. Not helping the cause is Silvio Berlusconi who kept up a political career despite having sex with numerous prostitutes, some of whom were minors.

Italy also has to deal with secessionist movements in the north (sometimes referred to as Padania), Sardinia and Sicily. In Sardinia polls show up to 40% of Sardinians supporting independence. Whilst Lega Nord (a pro-Padania party in the north) is the largest party in the Veneto and enjoys strong support in other regions such as Lombardy and Piedmont. Dealing with secessionist movements is always difficult, improving the economy tends to help, as does increasing the autonomy regions have. The north of Italy is much wealthier than the south and many northerners feel that they are subsidising the poorer south. A lot of grievances could be eased if the south was economically vitalised. There are major problems with this, the south has been poorer than the south for centuries, so the inequality is structural and would require a lot of capital. Capital that Italy simply does not have.

Italian finances are in a horrific state, its debt to GDP ratio is 126%, the 2nd highest in the Western world and the 8th overall. To make matters worse Italy is one of the European PIIGS countries that needs help from its northern neighbours. Italy needs serious financial reform (a good start would be slashing politicians' pay) and money to stimulate its economy.

So Italy faces three key problems; an ageing and declining population, strong secessionist movements and a crumbling economy.

Starting to notice a pattern of problems with Western nations?

Old World Order - Germany

Population: 80 million
Area: 357,000km2
GDP: $3.6 trillion
GDP (per capita): $42,000
United Nations Security Council Veto: No

The numerous German states were unified in the late 1800s under the brilliant leadership of Otto Von Bismarck. The first century of its existence was tumultuous, its expansionist politics helped cause WWI and were the primary cause of WWII. Both wars ended with defeat and humiliation for Germany. Thankfully the Allies learnt how to deal with a defeated Germany and the Germans seemed happier to assume a smaller role in the world than they had previously desired. 

At the moment Germany is doing rather well, its lack of housing boom and export led economy meant it has been able to weather the recent economic crisis. It is the largest country entirely in Europe with over 80 million people (15th largest in the world). Its economy is the fourth largest, behind only America, China and Japan. Germany's economy is also growing, considering the circumstances this is quite a feat. Yet there are dark skies approaching Germany's future. 

For the first decade of the Euro's existence, Germany benefitted greatly as it made exporting to the European periphery easier. Unfortunately crisis in the PIIGS (Portugal, Ireland, Italy, Greece and Spain) could spread to Germany.  The northern Euro nations, especially Germany, have demanded that, in exchange for bailouts, the countries must impose harsh austerity. This had proved disastrous for the economies of the countries who are in a worse financial state, despite the bailouts Greece still risks default. If Greece goes then a domino effect could occur on the other PIIGS countries which would devastate the world economy, particularly the Eurozone. German banks that lent a lot to the PIIGS would default if the Germans did not bail them out.

Another risk to German power (and GDP) is its shrinking population. By 2050 Germany is expected to drop to 21st in the world rankings, with 71 million people, just marginally more than Britain. That would mean Britain would have the largest population in Europe by 2060. This is beneficial to Britain, not so much to Germany.

Germany's most serious threat originates outside of its borders, in the Eurozone periphery. I've already discussed what the problem is, so here I will concentrate on the solution. To solve the crisis will require the agreement of the Eurozone countries (there's 17 of them) and possibly the whole of the EU (28 nations) and help will probably have to come from the IMF and/or World Bank (the whole planet). Oh dear. Even just getting the agreement of the 17 Eurozone nations is difficult enough. What Germany needs to push for is more fiscal integration, which it has been doing, and economic stimulus in the problematic regions, which it has done the exact opposite. The Germans seem unwilling (like much of the rest of the world) to learn from the lessons of history that stimulus works and austerity fails.

To sum up; Germany faces two major challenges, a declining population and trouble in the Eurozone. The Eurozone challenge can be fixed - If German leaders recognise their mistakes and rectify them.

Old World Order - France

Population: 66 million
Area: 641,000 km2
GDP: $2.7 trillion
GDP (per capita): $36,000
United Nations Security Council Veto: Yes

France has been at the centre of European history for over 1100 years. In Europe, the only country that's been in more wars is Austria (although largely powerless now, before the 20th century Austria dominate Central European affairs). France had a huge empire and once nearly conquered all of continental Europe bar a disastrous attempt to invade Russia in the winter. These days France is still pretty powerful, having the 6th largest military expenditure in the world and veto power on the United Nations Security Council. It also has close ties to its European neighbours. France's future, however, is not all that rosy. 

One problem France is going to experience is population growth, or lack thereof. Currently France is the 21st largest country in the world with 65 million people, but by 2050 it is expected to drop to the 25th largest. Although its population will have risen to 69 million, it will have been shrinking since 2040. One way to reverse this would be to increase the amount of immigrants to France, but the French populace doesn't like that idea much. 

Although France's finances are not in the dire state that some of its European neighbours are in, economic prospects are gloomy. Since Hollande took power last year France's economy has barely improved. France is also vulnerable because it is in the Eurozone, which means the PIIGS (Portugal, Ireland, Italy, Greece and Spain) countries' troubles are France's troubles. Its banking sector is particularly at risk from a Greek default due to the amount of money French banks have lent in Greece. Another Great Recession could hold France back for too long. 

One option France has is to move to closer ties within Europe. More fiscal policy and banking integration with Euro currency countries. This obviously has massive problems and rather glaring obstacles. To pull closer to political integration requires the other countries to do the same. There is increasing euro-scepticism in many Euro countries, particularly in the Netherlands and Finland. The problem is that fiscal integration can only happen it all countries currently using the euro agree to do this. Hollande must convince the Northern Europeans to stimulate the PIIGS economies, rather than demand austerity which simple makes the situation worse. 

Another issue facing France is the rise of the extreme right epitomised by Marine Le Pen and her party, the National Front. If we ignore the obvious historical similarities between this and the rise of Hitler following the Great Depression in 1929, this is still an issue for France. Le Pen is an isolationist, similar to Nigel Farage in the UK except more extreme, she wants out of the Eurozone, the EU and Schengen Area as well as reducing immigration by over 95%!

So France faxes three main issues; isolationism, population decline and economic turmoil in Europe. Solving the economic trouble will be difficult, but would go a long way to reducing isolationism. The population decline problem can be fixed by immigration policies that the French won't like. 

The Old World Order

It's been a year since I wrote about the rise of developing nations, a "New World Order" of sorts. I looked into five countries, and Africa, and how rapidly they were rising and what challenges they were facing. The countries I reviewed were:

1. China
2. India
3. Brazil
4. Mexico
5. Indonesia

This year I have decided to look into the countries that are currently at the top. The countries that will be faced with a lower influence in the world as other countries overtake them. I looked into how the "Old World Order" might manage its decline, or perhaps reverse it! Over the next few days I will be discussing the following countries as well as Europe:

1. United States of America
2. United Kingdom
3. France
4. Germany
5. Japan
6. Italy
7. Canada

Old World Order countries in red, Europe in green

EU Membership at Stake

David Cameron has attempted to quell the rise of UKIP and appease Tory backbenchers by promising en EU referendum in 2017. So why so late? Why not next year? The problem at the moment is that the Conservative Party's coalition partner, the Liberal Democrats, are very pro-EU and will not allow a referendum earlier.

Cameron has proposed a bill that would mean that after the next election in 2015, a Tory government would try and re-negotiate Britain's relationship with Europe. If we don't get the concessions the Tories want an in-out referendum would be triggered in 2017. The major flaw with this is that there may not be a Tory government in 2015, Labour is ahead in the current polls. The Tory Party will not be able to make the law binding as governments aren't allowed to pass laws restricting future governments. The bill will have to be a private members bill as the Lib Dems won't allow it to be coalition policy.

So what has pushed Cameron to propose this bill? The recent success of UKIP will have struck fear into him and he needs the support of his Euro-sceptic back-benchers. It won't have helped that in the last several weeks old beasts of the party such as Nigel Lawson, Norman Lamont and Michael Portillo have called for a referendum as well as cabinet ministers Michael Gove and Philip Hammond.

With the UK's membership of the EU in peril I hope Miliband doesn't back this dangerous bill.

EU Removes Burma Sanctions

The European Union has decided to lift most sanctions previously placed on Myanmar/Burma. The decision has been described as premature by some but the move is supported by democracy leader, Aung San Suu Kyi. The decision was made in the backdrop of increasing sectarian tensions and violence, particularly in the west of Burma. In western Burma the minority Muslim community has been attacked which has resulted in the deaths of hundreds and displacement of over 125,000! The violence began last summer and has started to escalate out of control. A recent Human Rights Watch report accused the Burmese government of ethnic cleansing due to its inability to help the Muslims. It may come as a surprise to you that it is Buddhists who are leading the violence! In the West people tend to portray Buddhists as good people who never partake in violence. It would appear that all religions have violent elements to them.

Currently Burma is slowly moving from military dictatorship to a democracy. In 2012 Aung San Suu Kyi's party, National League for Democracy, made significant gains in by-elections held in summer. Yet the government still retains an iron fist on power. Together the military and the government party (Union Solidarity and Development Party) control 322 of the 440 seats in the lower house, called the Pyithu Hluttaw. In the upper house, called the Amyotha Hluttaw the government has 185 of the 224 seats. With a presidential election in 2015, Burma may be in for rapid change. Let's hope that they can handle it!

Violence has spread throughout the country.
source: www.bbc.co.uk