Precious little, by most accounts. Perhaps that was the best to be expected, given how hard it is to get anything done in most parts of Europe in high summer-holiday season, and the fact that both, in effect, had terminated their own vacations early to meet.

(And no, rest assured that Chancellor Merkel does not regard such trips to the City of Light as recreational in any respect. Still, from the various photos emanating from that summit – check out for example this one from the De Morgen piece – one could even get the impression that they have become more comfortable in each other’s presence, something that was a problem before, as has been noted in this space.)

Continuing the beach theme, here’s one reaction, from Het Laatste Nieuws:

#geld Merkel en Sarkozy strooien zand in de ogen van de mensen: De plannen van de Franse president Nicolas Sarko… http://t.co/1cJEZ9c

August 17, 2011 8:41 am via twitterfeedReplyRetweetFavorite

@HLNlive

HLN Live

“Merkel and Sarkozy throw sand in people’s eyes” – but who is saying that? The HLN editors? No, that comes from former Belgian premier (now in the European Parliament) Guy Verhofstadt. He’s sort of a nerdy political guy – there’s a great shot of him in that HLN article, together with yet another shot of Merkel and Sarkozy posing happily together – but has been a prominent figure on the Belgian political scene for quite a while, and on the European level is mainly known as a convinced federalist.

What was the main thing this “royal couple” could offer the press after their meeting? It was the formation of a so-called “economic government” within the framework of the Eurozone, chaired by the President of the European Council (currently Herman van Rompuy) and meeting perhaps twice a year. But that clearly is a frequency of consultation which is way under what is appropriate. The plan also falls short on the personnel side as well – and I’m not even referring here to Van Rompuy, whom many regard as a colorless, ineffective figure. No, if there is to be an “economic government,” then it needs to be run by experts, namely by officials from the relevant Directorates General of the European Commission.

That is basically Verhofstadt’s reaction to that one-day Franco-German summit yesterday, which he is plainly putting forward with a full-court press: not only are there newspaper articles such as in HLN, but I also heard him putting forward his points in English on the BBC World Service and listened to a similar report on the local Belgian news even as I was writing this post.

Basically, to translate things into popular current American language, the “royal couple” meeting in Paris in merely “kicked the can down the road.” In so doing, they left themselves vulnerable to letting outside events take control of further developments instead. For example, they rejected the idea of “Eurobonds,” i.e. debt securities issued in the name of the EU and therefore taking advantage of German levels of interest. But, as Verhofstadt noted in that BBC interview, the next crisis around Spain/Italy will likely make them change their minds on that fairly quickly.

                          

Definition of “crisis”: when officials need to huddle up on a weekend before Asia opening to take decisions & do statements a turmoil rages

August 6, 2011 1:43 pm via webReplyRetweetFavorite

@Nouriel

Nouriel Roubini

The Czech daily Mladá fronta dnes, as caught by the @Zpravy Twitter-feed, has the details on this particular edition:

iDnes: Lídři EU chtějí rychle realizovat závěry summitu. Uklidní tak trhy: Vlády musí urychleně dokončit dohody … http://bit.ly/oLaqvt

August 6, 2011 11:30 am via twitterfeedReplyRetweetFavorite

@Zpravy

Zpravy

Turns out, if you like, that you can blame everything on European vacation syndrome (e.g. “No one touches my August holiday!”): EU leaders want to quickly carry out changes from summit, that way they’ll calm markets is the headline here.

• “Summit”? That’s the one they just had, of course, an extraordinary convening in Brussels on July 21 in reaction to the Italy/Spain funding troubles.
  
• “Changes”? That has to do with the European Financia Stability Facility (EFSF), which leaders at that summit agreed would be beefed up to better be able to intervene to assist eurozone member-states in financial need, eventually even becoming a sort of European Monetary Fund.

The result according to the Czech paper has been a recent series of extraordinary conference-calls, at one point simultaneously featuring German Chancellor Merkel, French President Sarkozy, Spanish premier Zapatero, Italian premier Berlusconi, and British PM David Cameron all on the line, with US Treasury Secretary Timothy Geithner also allowed to listen in. Afterwards, it is reported here, they all called President Obama for good measure.

We’ll see what they came up with from any official announcements during the rest of this weekend, and then of course get market reaction starting from the Asian opening late Sunday night/early Monday morning (European time). But one thing these conversations are said to have produced was a pledge by Berlusconi to balance the Italian budget a year ahead of schedule, in 2013, and even to put a balanced budget amendent into the Italian constitution. (At least that is how I interpret the key phrase here ústavního dodatku, although ústavní can mean merely “institutional” in addition to “constitutional.”) If such an ironclad balanced-budget imperative would be a foolish move for the US – which everyone agrees it would be – how can it make any more sense for Italy?

                          

De ongemakkelijke kussen van Merkel en Sarkozy http://bit.ly/oL54CI #merkozy

July 22, 2011 9:34 am via bitlyReplyRetweetFavorite

@volkskrant

De Volkskrant

One little-known roadblock to the EU’s ability to come up with a collective solutions to Greece and any number of other problems is the sheer antipathy said to prevail between the heads of the two most-powerful member-states, i.e. Angela Merkel and Nicolas Sarkozy. Indeed, the dominating primacy of this “Franco-German axis” long ago reached cliché status among analysts of the European Union (though it’s no longer quite so true, naturally), meaning that the personal chemistry between the inhabitants of L’Élysée and the Reich Chancellery assumed a outsized importance to the two nations’ fortunes.

Unfortunately so, because Merkel and Sarkozy have apparently not been on speaking terms – at the personal level; their offices communicate just fine, thank you – for quite some time. Or maybe you don’t believe me and would like to see for yourself – well, the Dutch newspaper De Volkskrant now enables you to do that by presenting this fantastically-awesome photo-series compilation of thirty-six (yes! count ‘em!) kisses, embraces and similar close encounters – all fully-clothed: s’il vous plaît, je vous en prie! – between the two, entitled “The uneasy kisses of Merkel and Sarkozy” (and soon to be a major motion picture!).

So check them out, if you’re into analyzing that sort of thing. I imagine €S’s female readership will be particularly good at this. Do they look comfortable with each other? Here, let me help you out with what I’ve heard, although none of the following is really surprising if you think about these two characters for just a bit. Sarkozy thinks Merkel is a dull, unimaginative cow; for her part, Merkel regards Sarkozy (who is certainly shorter than she is, BTW, no matter what the photos might imply) as an excitable, flashy “bling-bling” fellow – as does indeed much of the entire French electorate, it seems.

C’mon, waddaya think? Frankly, the accompanying Dutch text gives the game away, in detail, so I’m not going to translate it for you – ha! Other than this remarkable part: “They do have to overcome even a certain repugnance in each other’s presence. But History has sentenced them to each other, so there’s nothing else to do but get over that repulsion.” Aint it the truth!

                          

Le Monde provides a perspective, in an unsigned article (Libya, a political objective now uncertain for L’Elysée). Put simply, it’s something akin to buyer’s remorse. France was looking forward to a glorious “big brother” role with the assistance it provided the rebels, one that would go far towards erasing – so officials hoped – her rather ugly colonial history in the area. Most of all, though, this was supposed to be short and sweet, something – in the words of Juppé back in March – that was to “be calculated in days or weeks – certainly not in months.”

Well, now it is months later, and the fighting is still going on. The rebels do seem to be making some sort of progress, yet it still seems doubtful that they can take full control before the onset of the Muslim fasting month of Ramadan on 1 August complicates their efforts considerably.

According to the article, Sarkozy had a somewhat earlier date in mind for a rebel victory: 14 July, or Bastille Day, just two days away, when the usual parade of military hardware down the Champs Elysées could be spiffed up considerably on the wave of a cut-and-dried successful military campaign. But that certainly will not happen, and meanwhile Le Monde reports how the French president recently changed his mind from a trip across the Mediterranean to go visit the rebels’ self-styled Libyan Republic and opted to visit actual French troops in Afghanistan instead.

At least Sarkozy has just confronted the issue of submitting his military operations to approval of the legislature rather better than Barack Obama has done, and indeed has gained renewed votes of support for Libya actions from the Assemblée and the Senate, when there were fears that this was not certain. But the fighting goes on, and perhaps it should not be so surprising that the French should start lowering their standards for how they think it should end, as long as it does so quickly.

                          

The result: Even as the masses out on the streets shriek NO! the government goes ahead with “Yes” – and this in a liberal democracy. Of course, things are actually not quite so clear-cut as that. All the people out demonstrating often make an impressive sight, but do they really represent the political will of the majority of France’s citizens? And even if they do: France is not a direct democracy where the people vote directly on laws – no modern society is a direct democracy – but rather a representative democracy, where according to one section of the rules of the game (somewhere; I believe it’s in Aristotle) the elected law-makers do have the right to go against the will of their constituents if they believe doing so better serves the nation. And it would seem raising the retirement age from what is financially a completely unsustainable age to one slightly less unsustainable qualifies.

Ah, but even as the Assemblée Nationale and French Senate undertake to do so, they make a mess of it. For while they were passing this retirement reform, they chose not to pass amendment 249 – that’s the one that would have subjected their own even-more-generous lawmakers’ pension system to the same conditions they were about to impose on everyone else’s!

Pretty outrageous, no? (Then again, the US Congress also almost routinely exempts itself from the laws it passes for the rest of the country.) I heard about this little bit of chicanery in the first place from an editorial in today’s Le Monde: You’re making me take to the streets – me, a moderate! It’s written by one Gregory Kapustin, who calls himself an “entrepreneur” and “former moderate.” (Check out his public LinkedIn page!) His message is basically expressed in his title; the actual article fills in the details about how, yes, he understands why pensions must be reformed, and he wishes the French nation would grow up and face the real world of globalization – but really, in exempting themselves the legislators have simply gone too far with their cynicism and he’ll be off to join the nearest street-demonstration. (With gasoline, bottle, and rag-stuffing in hand? He doesn’t say; he still seems to be too much of a professional dude to go that far.)

One can gain a similar feel for what he is fed up with from another article, from Le Point: Sarkozy will take some time to reflect on the situation after retirement reform. The lede:

Nicolas Sarkozy declared on Friday that he will announce when “the time is ripe” for initiatives in response to the French people’s worries and that he first intends to “take some time” to reflect on them.

As becomes clear as the article goes on, however, don’t expect him to start that thinking anytime soon, he’s a busy man. The Chinese president will be visiting Paris soon, then it’s off to Seoul for the G20 summit. Sarkozy made it clear that, when it comes to addressing the concerns of his countrymen he won’t “confuse speed with haste” but will take “time to reflect serenely, calmly, profoundly.” Hey – merci bien, monsieur le président! I bet your own pension is rather more generous than that of the man-on-the-street as well!

                          

For France, certainly, such an outbreak of widespread strikes and demonstrations is certainly nothing new, although the current spate does feature a couple of intriguing aspects. One is the relatively recent outpouring into the protestors’ ranks by both secondary-school and university students, even as the relevance to them of the retirement age issue remains questionable. (I suppose that, if anything, it involves moving their elders out of jobs and into retirement sooner rather than later, so that those positions can open up for them – but is that really even a remotely-accurate description of how the employment market works there? In a static economy like that of the USSR, maybe; in modern France, certainly not.)

More engaging to this observer is the way the strikes are shutting down the country’s petroleum distribution system, swiftly leading to the sort of ugly petrol station-mobbing and hoarding behavior by motorists seeking precious essence (French for “gasoline”) of the kind last seen in the West way back at the time of the second great “oil shock” (occasioned by the Iranian Revolution) of 1979. Indeed, it’s precisely this (and seemingly not, say, the half-million people marching through the streets of Paris) which so far has really engaged the French leadership. President Nicholas Sarkozy had to issue a statement from his summit with German and Russian leaders that he would make sure that the blockades of the oil refineries end, and his prime minister, François Fillon, is in fact meeting with key fuel sector executives at his palace, the Matignon, later today.

It’s now a very different world than back in 1979, although you might be fooled considering the similar sort of manic craze that can be raised in today’s society by uncertainty in gasoline supplies. But today we have the Internet, and greatly-expanded communications possibilities generally, and Le Figaro (the President’s newspaper, essentially) has stepped into the breach with a new article detailing how those savvy on-line can gain an advantage to filling up, or at least avoiding empty stations. You can follow along yourself at home for your own amusement (but it does help to know French): at this discussion-board, for example, or with this map of empty stations or maybe this one here.

What’s intriguing to me is that smartphone penetration among French consumers is assuredly nowhere near high enough to result in panicked motorists careening around to find an open gas station guided by the telephone-screen they hold in one hand as they hold the steering-wheel in the other. Not yet, at least; but that day will surely come.

*To those who have already sent inquiries or might become so inclined: NO, EuroSavant has not been participating in this strike, and in fact we hold absolutely no sympathy for it or its aims.

                          

Time now for the tournament to move on, which it has done already with, among other things, England’s narrow 1-0 victory over Slovenia and Landon Donovan’s last-minute goal for Team USA which sent them on to the sudden-death Round of 16 and sent the Slovenians packing for home. For any of those with a more morbid outlook, though – those who tend to linger long while passing the scene of a horrific accident by the side of the road, say – Grégory Schneider of the French paper Libération has some behind-the-scenes details of what happened with the French, including the precise wording of Nicolas Anelka’s to-his-face characterization of his coach during half-time of the France-Mexico game (Get ready: Va te faire enculer, sale fils de pute! It’s pretty bad.) that got him sent home and was the immediate cause of all the trouble.

You see, his teammates didn’t really feel Anelka’s saying that merited what they saw as the extreme measure of actually sending him 6,000 all the way back home. So they went on strike, and Schneider lays out the scene:

Robert Duverne [France fitness coach] had already laid out his cones. It was 16.00 hours yesterday when the players disembarked from from the bus that permitted them not to have to traverse on foot the 400 meters separating their hotel from the Field of Dreams [sic] . . . of the Pezula Hotel, where they had been training for two weeks. All the players went to sign autographs for supporters, massed to the left of the field. All, except their captain, Patrice Evra, in a big discussion with the trainer, Raymond Domemech. And it’s there that the French team abandoned itself to Chaos.

Robert Duverne . . . approaches Evra with the clear intention of giving him a pop in the mouth. Domenech interposes. Duverne, furious, leaves swinging his timepiece. Evra gives the signal for the players to return to the bus, before even the first ball has rolled. They go there as one, and one notices the telling detail: they have on basketball sneakers, whereas they train in cleats. Jean-Louis Valentin, Director-General of the French Football Federation (FFF), emerges from the back of the bus and leaves the scene . . .

. . . and says some nasty stuff about the players (more examples of French profanity, but I think you’ve had enough for today), thereupon declaring that he intends to resign his position and go straight back to Paris himself.

Afterwards, Domenech joins his players on the bus, which doesn’t go anywhere. Instead, he re-emerges after half an hour to stand pasty-white and read to the press a statement from the players protesting at Anelka’s treatment. Remember that it was this Domenech who had been subject to the above-quoted nasty characterization from that same Anelka.

From there it got even worse. The players turned out not to be as unified as they declared; rumors of divisions, possibly along racial lines, soon surfaced. Team captain Evra (fired soon afterwards) noted at a subsequent press conference that things would not have gotten as bad if Anelka’s behavior could have been kept confidential within the team. The fact that it leaked to the outside world he attributed to a “traitor” within the team ranks; yes, he knew who it was, but would not say. Still, he was also willing to admit that Anelka’s behavior towards his coach was “inadmissable.” OK then, the assembled reporters wanted to know, how come the players are insisting that he stay?

In all, Schneider provides a lot of the juicy stuff, if not all of it, for those who are curious, including a revealing photograph at the top of the piece showing an exasperated Domenech walking alongside Patrice Evra, with outstretched palm, who is apparently trying to explain something. Who knows what we will hear further as a result of Thierry Henry’s meeting with the President? After all, for the French the 2010 World Cup is over, after having (in Scheider’s words) “verged on the grotesque.” All that remains is to try to try to get the whole story of what went wrong, in the interests of the team at future tournaments.

                          

Sure, the President was nowhere near Brussels at the time. Still, in Quatremer’s view it was the key telephone calls he placed to the main decision-makers – mainly France’s Sarkozy and Germany’s Merkel, of course – that made sure something big and decisive would happen. And then it seems he also gave a call on Monday to the Spanish premier, Zapatero, to persuade him to buckle down with some serious government cost-saving measures (that included lowering public employees’ salaries and cutting pensions), and he may have similarly bent the ear of Portuguese premier Socrates as well.

The Libération correspondent’s just-below-the-surface point is that none of Obama’s interventions should have been necessary – quite apart from the fact that he carries no official post or authority within the EU or any of its member-states. It was clearly an emergency situation (and it may still be), but it seems that the European leadership actually in place was itself not equal to the task, and instead had to be persuaded by the US President to do the right things.

Actually, it is not clear that EU leaders would have failed to take appropriate measures absent the President’s calls – it’s also not clear that the measures they did take, despite the huge-sounding €750 billion figure, were sufficient to the emergency – but that is a historical experiment no one really desired to undertake for real. It does seem a more convincing case that Zapatero would not have acted as he did without the American intervention, and also that the official who actual does hold the “EU Council President” title that Quatremer says Obama usurped – namely Herman van Rompuy – was fairly useless throughout. (Quatremer: “If during this crisis the former Belgian prime minister was useful for anything, you’ll have to explain that to me.”)

Another thing that this tale gives the lie to: that Europe’s current economic and financial travails need be no concern to the Americans, something asserted recently by no less than Treasury Secretary Timonthy Geithner. No, says Quatremer in rather dramatic fashion, Obama realized all too well the “risk of unleashing a [financial] tsunami capable of ravaging the planet.”

BTW in recent times I’ve repeatedly picked up glowing praises and recommendations of Quatremer’s blog – written in French, of course. So I think it’s time that I finally start to read it more regularly and have added it to my RSS reader under a label that should ensure that subsequent entries do attract my attention (even though there’s really something wrong with the clunky way he embeds photographs into his posts! Mais ça, ce n’est rien . . .).

                          

On the other hand, the story here is not quite as coherent as the Danish report. Sending this He (“He-man”? Hu?) guy in his place was of course a deliberate gesture by Premier Wen to show his contempt for what was going on, but it turned out to be smart in another way since He turned out to be the direct verbal target of some very powerful Western politicians, along with Indian Premier Manmohan Singh. All this was not because of any sort of anti-Asia prejudice on the part of the other world leaders, but out of the very good reason that China and India had already decided that they simply would not go along with the sort of legally-enforceable national limits to greenhouse-gas emissions that European leaders (mainly) were trying to enshrine in the World Climate Treaty that was supposed to issue out of the conference, limits designed to replace expiring national obligations under the Kyoto Protocol (2005).

German Chancellor Angela Merkel was the main protagonist here, fighting hard for measures designed to limit the rise in average temperatures to 2ºC through this century. This meant among other things cutting greenhouse-gas emissions by 50% by 2050. Western developed nations had already agreed to cuts of 80%, but something would have to be forthcoming from the developing world as well if that 2050 goal was to be achieved, especially considering the explosive recent economic growth in China and India. But behind closed doors the representatives from those countries did not yield from positions that had already been taken publicly, namely that they weren’t interested in any binding restrictions and, in any case, they had no obligation to be interested – it was mainly the West’s fault anyway that the world was in the dire climate-change situation it now found itself. This attitude led Merkel to expressions of dismay and President Sarkozy to (politely stated) accusations of hypocrisy, while according to the transcript Obama tried to intervene to calm the waters, expressing a not entirely-useful hope that things could be settled “later, outside of this multilateral framework.”

The lesson I draw from this report is that the public stances countries take prior to such summits are generally serious ones, i.e. they accurately track the positions those countries will adopt once negotiations begin. The only real sensational element here, then, is the accounts of the personal interactions – sometimes quite tense – between the world leaders present. At least the picture of events from this leaked transcript gives the lie to the assertion of many commentators that at Copenhagen European leaders ultimately were left on the sidelines while the conference’s fate was decided in discussions between the US and China. But I guess a leading European publication like Der Spiegel would say that.

By the way, the reason all this climate-change stuff is current again in the news is probably the international conference now happening at Petersberg, Germany (near Bonn), intended to draw lessons from the COP15 experience. This is meant in preparation for the very next formal UNFCCC world climate-change conference, scheduled for next December in Cancún, Mexico.

                          

Take for example the blogpost found on this site a couple weeks ago: there, resort to the IMF to assist Greece out of its bind was unthinkable, and the proposed solution – suggested by no lesser figure than the current German Finance Minister Wolfgang Schäuble – was instead to set up some sort of Monetary Fund within the institutions of the European Union. You can scratch that now; according to no less than Bundeskanzlerin Angela Merkel (who of course outranks Schäuble), IMF involvement would be perfectly OK and, if there is to be some sort of within-the-EU Monetary Fund, then it certainly won’t be able to appear in time to have anything to do with solving the Greek case. Oh, and another point I made was that the preferred technique so far of EU heads-of-government for dealing with the Greek situation was simply to issue declarations of support without actually doing anything to back them up, and that is also no longer completely true. Mind you, it’s not that the EU leaders now are trying to back them up; it’s that some, such as Bundeskanzlerin Merkel, don’t even want to talk about it any more, including shutting Greece’s problems off of the agenda for another EU summit meeting scheduled to be held next week.

But it gets even worse, as we see in an article in today’s issue of the Dutch business newspaper Het Financiële Dagblad. Merkel now is willing to countenance IMF involvement, but Nicolas Sarkozy still insists publicly that that is out of the question. Furthermore, the French President (together with Jose Manuel Barroso, Chairman of the European Commission) does want to talk about Greece at next week’s summit, at least to the extent of issuing another ringing declaration that the country will not be let down by its EU brother-states – thereby accomplishing a lowering of its borrowing costs, at least for a while.

Unfortunately, it seems that an IMF team has already been called in to take a look at the Greek situation, according to this HFD piece. Plus, the suspicion remains (although it is mentioned elsewhere, not here) that Sarkozy mainly wants to shut out the IMF in order to deny credit/glory to that organization’s head, Frenchman Dominique Strauss-Kahn, who might well run in 2012 to replace Sarkozy as French president. But this now-open disagreement on fundamental aspects of how to deal with the situation between the heads of the EU’s two leading states can only worsen investor confidence in Greece’s finances, and thereby the situation as a whole.