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Habermas: Europe Is Doomed (probably not)

by afew Mon May 3rd, 2010 at 09:12:07 AM EST

The FT has an interview with Jürgen Habermas by Stuart Jeffries.

FT.com - A rare interview with Jürgen Habermas

Angela Merkel told the Bundestag that existing EU rules were not strong enough to deal with the crisis triggered by Greece, and that in such circumstances it may be necessary to throw a country out of the eurozone...

Such a lack of solidarity would certainly scupper the whole project. Of course, Merkel’s statement was intended at the time for domestic consumption in the run-up to the important regional election in North Rhine-Westphalia. But there can be no better illustration of the new indifference of the new Federal Republic than her insensitivity to the disastrous impact of her words in the other member states... the generation of rulers in Germany since the chancellorship of Gerhard Schröder has pursued an inward-looking national policy. I don’t want to overestimate the role of Germany in Europe. But the breach in mentalities which set in after Helmut Kohl has major significance for Europe.

Habermas gives a brief summary of post-WWII Germany's wish "to return to the fold of civilised nations" and to contribute to European construction, an aim that was prolonged in the postwar generation, up to reunification.

...a total defeat connected with an inconceivable moral corruption also created an opportunity for the following generation to learn more quickly. Looking at our present political elite, this window of opportunity seems to be closed. The narcissistic mentality of a self-satisfied colossus in the middle of Europe is no longer even a guarantee that the unstable status quo in the EU will be preserved.

An optimist, though, Habermas - see below.


Not in the short term, however. European integration, he says, was pushed for by economic forces until, with the single market and Maastricht, the "market Europeans" had obtained what they wanted, and ceased to be a driving force for further "deepening of the institutions". An elitist political approach that attempted to follow on, "above the heads of the national populations", has failed: "Today, for the first time, the European project has reached an impasse."

But Habermas makes another move out to a broader and longer historical perspective:

...what annoys me – aside from the insensitivity of neo-liberal policy to the external costs of the social upheavals that it callously takes for granted – is the lack of a historical understanding of the shifts in the relationship between the market and political power. More than half a century ago, Karl Polanyi described capitalist development as an interplay between a functionally necessitated opening of society followed in each case by an integrative closure at a higher level. Since the beginning of the modern period, expanding markets and communications networks had an explosive force, with individualising and liberating impacts on individual citizens; but each such opening was followed by a reorganisation of the old relations of solidarity within an expanded institutional framework. Time and again, a sufficient equilibrium between the market and politics was achieved to ensure that the network of social relations between citizens of a political community was not damaged beyond repair. According to this rhythm, the current phase of financial-market-driven globalisation should also be followed by a strengthening not only of the European Union but of the international community.

How much "creative destruction" (a term that is not Habermas's) will globalising neo-lib financial capitalism rip profit from before the pendulum swings back, is the question I'm pondering.

Display:
Try this link if you can't get into the article.

It begins with an introduction to Habermas, then a summary of the interview, then quotes from the interview.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon May 3rd, 2010 at 09:48:14 AM EST
Here's how I think about the current debt crisis in the Eurozone. Start with two facts:
  • The Eurozone has, in aggregate, balanced external trade. This means there is no real pressure on the Euro exchange rate from trade flows.
  • The Eurozone has most of its debt, public and private, denominated in Euros. This means large exchange rate swings do not put in danger the solvency of either the public or private sectors of the Eurozone's economy.

That is, from the point of view of monetary policy, the Eurozone is a resounding success.

So, what is the problem? The problem is fiscal and political, not monetary. It is entirely about sharing (or not) the gains from the single currency area and the losses from the deleveraging of the debt bubble.

If the Eurozone member states cannot find in themselves solidarity between (as opposed to within) nation states and cannot find the political will to build a shared fiscal (and industrial!) policy, the Eurozone will implode from within (not due to any external pressure).

The EU having been run by nationalistic politicians with no vision for the last 15 years, I am not optimistic. And we saw how the electorate rewarded the conservatives in the last European (and in the German) elections. You don't get what you don't vote for (in this case, solidarity and forward thinking).

The brainless should not be in banking -- Willem Buiter

by Carrie (migeru at eurotrib dot com) on Mon May 3rd, 2010 at 10:02:03 AM EST
Is it the goal of becoming a reserve currency that shackles the ECB's ability to exert all its potential powers in controlling currency? In other words, why doesn't the ECB operate as a fully functioning reserve bank? If it did, and enhanced that sense of sharing not through direct subsidies from rich nations to the poorer ones but instead through the loosening of monetary policy, this would impact worldwide perception of the euro as a reserve currency.
by Upstate NY on Mon May 3rd, 2010 at 12:18:55 PM EST
[ Parent ]
Is it the goal of becoming a reserve currency that shackles the ECB's ability to exert all its potential powers in controlling currency?
No. It's the ECB's statute.
In other words, why doesn't the ECB operate as a fully functioning reserve bank?
In other words, because it isn't one.
If it did, and enhanced that sense of sharing not through direct subsidies from rich nations to the poorer ones but instead through the loosening of monetary policy, this would impact worldwide perception of the euro as a reserve currency.
If it did it wouldn't be acting like the trick of the plutocrats it is constituted to be.

In this context, maybe a sovereign default by a Euro country would help concentrate the mind of the plutocrats. For the citizens of the defaulting state, the consequences of a default cannot be worse than the neoliberal shock therapy being prescribed for Greece by the IMF, ECB and European Commission.

The brainless should not be in banking -- Willem Buiter

by Carrie (migeru at eurotrib dot com) on Mon May 3rd, 2010 at 12:46:28 PM EST
[ Parent ]
Right, I know the ECB doesn't have those capabilities. That's why I referred to it as shackled. I was wondering about the reasoning behind that, and you provided it.
by Upstate NY on Mon May 3rd, 2010 at 01:21:34 PM EST
[ Parent ]
I am not sure what the reasoning was behind it when those rules were written into the treaties. They were probably introduced at the behest of Germany, like the Growth and Stability Pact:
The SGP was initially proposed by German finance minister Theo Waigel in the mid 1990s. Germany had long maintained a low-inflation policy, which had been an important part of the German strong economy's performance since the 1950s; the German government hoped to ensure the continuation of that policy through the SGP which would limit the ability of governments to exert inflationary pressures on the European economy.


The brainless should not be in banking -- Willem Buiter
by Carrie (migeru at eurotrib dot com) on Mon May 3rd, 2010 at 01:33:33 PM EST
[ Parent ]
Nice catch, Danke.


The narcissistic mentality of a self-satisfied colossus in the middle of Europe is no longer even a guarantee that the unstable status quo in the EU will be preserved.
(re-emphasis of afew's quote above)
....
In complete contrast to that time, however, European unification remains to this day an elite project. We have yet to experience a European election in which the outcome turned on anything other than national topics and tickets. Until the Maastricht treaty, the unification process was also, if not primarily, driven by economic interests. Since the interests of the "market Europeans" were satisfied at that time, the economic impulses driving a further deepening of the institutions have lost their dynamism. The eastward enlargement of the EU was an historic achievement. But the arduous repairs undertaken in the Lisbon treaty revealed the limits of an elitist approach to issues of political integration above the heads of the national populations. The financial crisis has reinforced national egoisms even further but, strangely enough, it has not shaken the underlying neo-liberal convictions of the key players.


"Habermas addressing students in Frankfurt in 1968. He agonised over whether the student protests that swept Europe and the US at the time were `left fascism' or, more hopefully, attempts to `politicise the public sphere."

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Mon May 3rd, 2010 at 10:35:32 AM EST
Habermas has always been a problem for me in his philosophical arguments with Postmodern thinkers who largely follow after Heidegger. While feeling much closer to Heidegger's train of thought, especially the developments of that "train" after Heidegger, it's inarguable that the practice of Habermas' thinking is much more virtuous than Heidegger's.

The question of course is for the future.

by Upstate NY on Mon May 3rd, 2010 at 12:21:16 PM EST
Interesting that you should mention Heidegger. Along with Adorno he's the only other pholosopher mentioned by name in the introduction to the FT interview:
That he became so temperamentally idealistic was perhaps a surprise, given the circumstances of his early years. Jürgen Habermas should have been yet another philosophical Cassandra; instead, he is more like its ­Pollyanna. Born near Düsseldorf in 1929, he came of age in postwar ­Germany. As his Stanford Encyclopedia of Philosophy entry notes: "The Nuremberg Trials were a key formative moment that brought home to him the depth of Germany's moral and political failure under National ­Socialism." Philosophy, his chosen intellectual discipline, was hardly exempt. Indeed, one of his first acts as a public intellectual came when, in 1953, he challenged the great philosopher and one-time Nazi sympathiser Martin Heidegger to explain what Heidegger meant by an allusion in his Introduction to Metaphysics to the "inner truth and greatness" of National ­Socialism. Heidegger's silence confirmed Habermas's conviction that the ­German philosophical tradition had failed in its moment of reckoning.

Unlike Heidegger, Habermas never shirked the intellectual's responsibility of engaging with difficult moral and political issues in public - that, after all, was how the public sphere was supposed to work. Andrew Bowie, ­professor of philosophy and German at Royal Holloway, University of London, argues: "In many respects, he has been, and remains, the exemplary intellectual figure in the German public sphere since the 1970s, as social ­theorist, legal theorist, social critic, political actor and as a philosopher concerned to advocate a new direction for German thought after the Nazi period."



The brainless should not be in banking -- Willem Buiter
by Carrie (migeru at eurotrib dot com) on Mon May 3rd, 2010 at 12:49:27 PM EST
[ Parent ]
Yes, I read that whole article. That's why I mentioned Heidegger. In France, there was a split in Continental thinking from Habermas and the Left, and that's where much of Postmodern thought took root, in opposition to Habermas, and in a more or less direct-line from Heidegger. This is ironic, but only in the sense that the assumption is that Heidegger drew the wrong conclusions from his work on previous philosophers.
by Upstate NY on Mon May 3rd, 2010 at 01:23:53 PM EST
[ Parent ]


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