http://media2.intoday.in

 

“If the French are rightly proud of their emperor and the Britons of Nelson and Churchill, we have the right to be proud of the achievements of the German soldiers in two world wars.”

Alexander Gauland – Alternative for Germany leader

“At some point between now and 2030 or so we can expect another round of serious crisis, comparable to the mess that overwhelmed Europe and its empires between 1914 and 1954 — you know, two world wars, the Great Depression, the end of European global domination.”

John Michael Greer

 

The Financial Times columnist Gideon Rachman commented at the beginning of the year that it was unlikely that any German party would ever be successful with a slogan “Make Germany Great Again”. The stunning electoral success of the hard right Alternative for Germany party in the federal elections has shattered that assumption among the European chattering classes.

The nationalist right-wing Alternative for Germany (“AfD”) party surged to 12.6% of the vote and will send almost 100 MPs to the German Bundestag on the back of widespread anger about Angela Merkel’s decision to open the borders to over a million predominately Muslim refugees in 2015/2016.

In contrast, the traditional establishment parties gained the smallest share of the vote since the war. Angela Merkel’s Christian Democratic led coalition gaining only 33% of the vote and the Social Democrats did even worse, only 20%, one of their worst ever performances in their history.

The same liberal commentariat who were crowing only a few months ago that the populist threat had peaked on the Continent after the crushing victory of Emmanuel Macron in the French elections have gone very quiet now. Populism has arrived in the most powerful country in the EU with a dark history of genocide, totalitarianism and imperialism.

Although the German economy has grown a strong argument can be made that the German economic model is rotting from within. Ambrose Evans Pritchard, writing in the Telegraph, notes that net public investment has been negative for most of the last fifteen years and economic growth and productivity has been dismal since 2000. For ordinary German workers, real incomes have stagnated and the wealth gap is rising between the rich and poor.

One of the drivers for the surge of support for the AfD, apart from the migration crisis, was the growing number of economic “losers” within Germany. Many of these relatively poor workers live in the former East Germany which suffered massive economic and social changes after reunification. It is no coincidence that the AfD performed particularly well in the industrial Rust Belt areas like the Ruhr and eastern Germany.

Of course, the eruption of the nationalist right should be placed in perspective. The majority of the German electorate voted for other parties and polls indicate that many of those voting for the AfD saw it as a means to register their hostility towards the Merkel’s refugee policies. These voters are certainly not neo-Nazi’s nor do they approve of those elements within the AfD which flirt with the far-right.

The election of the dynamic President Macron appeared to herald a promising new dawn in the eurozone. The eurozone is a botched half-job which has muddled through, lurching from one crisis to another. The German elections were supposed to be the moment that the Franco-German motor would rev up and make real progress in the creation of euro-wide fiscal and political union. The German elections has had the opposite effect and gravely weakened those hopes.

The political reality in Berlin is that the new coalition government will be dominated by Eurosceptic conservative voices from within the CSU and the Free Democrats who are bitterly opposed to President Macron’s ambitious reform agenda. A eurozone which continues muddling along raises the growing risk, as Macron has predicted, of imploding within the next 10 years or so.

Historians will likely look back at the Merkel years as a 21^st century version of the long Edwardian summer before the horrors of the Great War. Alistair Macleod has predicted that by early 2019 at the latest, the eurozone will be plunged into another major economic crisis, triggered by rising interest rates and a collapse in government bond prices, resulting in the bankruptcy of eurozone banks. There is a growing consensus among economists that the current bull market is in its maturing phrase and is unlikely to last much longer.

Last year, in my post “winter is coming”, I attempted to forecast our likely future within the context of the limits to growth models which have proved eerily accurate since the 1970’s. To summarise, the peaking of global fossil fuels, accelerating climate change and an insolvent global economic system based on the false god of perpetual growth is leading us to another major crisis, potentially within the next few years.

Looking ahead, one can start to sense a foreboding future for Germany as the next decade arrives. Another economic crisis, potentially triggered by a deeper energy and food crisis, at the end of this decade, will plunge the eurozone into another recession. Rising unemployment, increased poverty and a loss of hope among broad layers of the population could lead to even bigger electoral successes for populists of both the Left and Right across the EU. Should Italy or one of the other eurozone countries exit the eurozone, under Target1, Germany could face crippling economic losses.

A toxic cocktail of rising Islamist terrorism and challenges in integrating the refugees, economic crisis in the eurozone and the proletarianization of a contracting German middle class could drive up to half the electorate into the hands of extremist parties on both the Left and Right. A revival of nationalist currents across the political scene could lead, by the end of the 2020’s, of a nationalist-conservative government in power. Should the worst case scenario happen and the eurozone/EU disintegrate, a German-Russian axis could reemerge as the dominant geopolitical force within the European continent.

To summarise, the broader global headwinds are wreaking the stable liberal post-Cold War era of international relations. The election of President Trump in November 2016 heralded, as I predicted months earlier, the beginning of a new era in world history, of Scarcity Industrialism. This era, described in detail by the German military in a report on peak oil, will lead to a breakdown in market based economies, the end of globalisation and the return of power politics in the world arena.

If, dear reader, that doesn’t sound promising terrain for a nationalist party attracting significant support already, then you haven’t read enough history.

For better or for worse, Germany is becoming a “normal” Western country and nobody knows for certain how European politics will be impacted in the years to come by this transformation.

One thing is for certain, it will not be boring…