Niall Ferguson has written a ten year projection on Europe, The Saturday Essay, on wsj.com. I guess this is the kind of thing he dishes out to students at Harvard for comments. Therefore I can’t resist the temptation to comment myself, albeit on a more humble level.
Ferguson thinks Norway will pop the question about a Nordic Union with Norway, Sweden, Denmark, Iceland, and Finland but he does not think they would be in close contact with Britain. This idea was up for discussion in the Swedish press not long ago. They even speculated on how to fuse the different royal houses into one. At the time I thought this was irrelevant because of the presence of the European Union. Why one more? The foreign minister of Sweden, Carl Bildt, thought the same way. The Nordic countries are actually quite different, especially Finland, which is already a member of the Eurozone. Ferguson thinks they would change allegiance, apparently. This is perhaps not so likely. There is a movement in Finland right now in the other direction. They want to remove Swedish from their schools. Finland was taken from Sweden 1809 by Russia after having been together for 700 years. This legacy means many Finns speak Swedish. Being close to Russia after years of Finlandization they rather cuddle up to Germany and the Eurozone for independence of a sort they prefer.
Sweden might also be in the mood of joining the Eurozone according to the politicians and the industry. It makes sense both economically and security wise. It is interesting that very little of current discussions on Europe involves NATO and security issues. America has vanished from the equation. It seems like Germany and the zone has supplanted it. People giving opinions on the matter in the Swedish press thinks Sweden, Denmark, and Britain will be forced to join the zone and support countries in trouble. Only the independently wealthy Norwegians seems to be able to do as they please. If politicians and industry in Sweden want to join Germany, it still might be difficult to convince the populace which watches British and American TV every day and don’t want to pay for the profligate Greeks. However, if the US can’t fix their gridlock in Congress soon and start working on their debt, people will lose their sense of security from the US and turn to Germany for comfort.
Ferguson is bullish on Britain and wishes it will stay out of the Eurozone which is my feeling also. He thinks Ireland would rejoin the English kingdom which I would also believe on cultural vibes. The Brits would not ever join the Eurozone and I have earlier suggested that they would form not Taiwan but Japan outside a Chinese equivalent Continent. He thinks Britain would be preferred for banking by China rather than Brussels although he envisions some sale of assets to the Chinese to go with that. When the ten Euro-countries fall to the Germans, that Ferguson suggests, there will be a new phase in European development built on German language and culture. Maybe Brussels will be moved to Berlin rather than to Vienna that Ferguson suggests. When France, Spain, Italy and seven other countries fall, people would flee to the security of a joined Eurozone that keeps the Russians at bay.
Ferguson seems to have an idea that the SPD would gain momentum is Germany. Angela Merkel, raised in East Germany, does have a streak of Social Democrat over her politics so maybe he is right and that the Eurozone will become something to the clear left of the US and Britain, even if the Democrats rule. Sweden’s center-right is also moving leftwards. What happens in China will probably also be important in terms of foreign investments. If China becomes socialist rather than robber baron capitalist they might favor the Eurozone preferentially over the new English kingdom. Personally I have this naïve idea that the US and Europe would start investing in jobs in their own hemispheres rather than in Asia, despite short sighted growth aspects and then Britain could count on support from this angle as well.
In 2012, Ferguson believes, Israel will attack Iranian nuclear facilities with all problems thus induced, like a blockage of the Strait of Hormuz. I don’t think this is likely. According to The Economist the Israeli military is against such a move which is going to be too problematic. My feeling is that the Arab Spring is slowly going to make the region Islamist/socialist. That would make the Israeli position continuously worsening as the US seems to leave the area for South East Asia in their Pacific Century. The response to the Muslim world is then going to be focused on the relationship with Europe which differs between The New English Kingdom and the Eurozone, or The United States of Europe, as Ferguson calls it. Israel does not have a good relationship with Europe, unfortunately, and might be forced into accepting to give up it Jewish state for something similar to South Africa, since Europe is so heavily on the side of the Palestinians, which I’m personally not. The fact The Arab Union went against Assad, sort of, is though a positive sign for the area, that could speak for a relative future stability.
Wolfgang Münchau at the Financial Times the other day claimed that saving the Euro would destroy the EU. Ferguson is on the same track. It is very likely that Germany with its “not now but later” approach have worked the situation into a two pronged result. Either they become rulers of the Eurozone with a weakened France or the whole thing falls apart with them still standing on the remnants to mind their own business with Russia.