Friday, May 26, 2017

FRANCE'S MACRON SWERVES AWAY FROM TRUMP TO GREET MERKEL. THIS IS A GOOD THING. HERE'S WHY ...

Watch as newly elected French President Emmanuel Macron walks towards a group of European leaders and, at the last moment, swerves away from President Donald Trump to shake the hand of the new leader of the free world, Germany's Angela Merkel.


French President Macron's swerve tells us two things are happening; one small, the second quite significant.

The first is admittedly a bit petty and small, but it's also driven by Donald Trump's antics on the global stage. President Macron's swerve to greet Angela Merkel is important because it signals that the rest of the world's catching up to President Donald Trump's petty personality.

Whether it's Trump's faux macho man handshakes, the constant disrespect and breech of diplomatic protocol, Trump's continued ignorance on trade matters and NATO, or the fact that world leaders simply don't respect our buffoon of a president, one thing's clear: world leaders just might not put up with President Trump's fraternity boy antics in the future, even if he is president of the United States.

When you consider that Europe is used to ignoring noble charlatans and brushing off monarchical figureheads, Donald Trump should probably get used to not receiving the respect he thinks he deserves, simply because he's president of the United States.

In many ways, this is a good thing, and a reflection of the second message the Macron Swerve sends the rest of world. Simply put, Europe has grown up.

A PLAN FOR THE WORLD
At the end of World War II the United States and its allies - primarily Great Britain and France - sat down and thought about the world they faced. Even in victory, it wasn't a pretty picture. Europe needed to be rebuilt. Japan was a mess. The Russians were rattling sabers in Europe. Worse, the ideas and patterns most of the modern world embraced before WWII had proven impractical, and destructive.



Socialism was a train wreck, and not an option in the west.

Fascism brought out the worst tendencies in the human condition, and proved to be a political and social disaster.

Unbridled capitalism had also failed the modern world, with several major market collapses in the 19th century, and the market collapse of 1929, which turned into the Great Depression.



All of this made it clear that business as usual was not the path forward. This was a daunting and fearful situation.

What emerged from this environment were a set of new ideas about our world, which included Keynesian economics, embracing global institutions, and putting the interests of a group of nations ahead of one dominant power. A more sophisticated understanding of world power and global politics emerged.

As the most powerful post-war state, the United States not only bought into this understanding of power, but backed it all up by agreeing to share decision-making on the political, military, and economic stages of the world. The United Nations, NATO, and the global economic institutions inspired at Bretton Woods (the IMF, the IBRD, and the GATT) would be the governing tools of our new global economic order.

Put more simply, the U.S. would not lead by force. It would lead through the strength of its ideas and institutions. Agreeable partners would make it all work. Strategic restraint on the part of the U.S. was part of the new game, while recovery and avoiding more Stalin's and Hitler's in the future were the goals.

Our modern world tells us the post-war plan worked. Fabulously.

The world entered a period of unprecedented economic growth. Europe integrated, and learned how to cooperate. Germany, the scourge of the early 20th century, has become a loud voice of reason and tolerance in the 21st century. Sure there were some hiccups. The Soviet Union caused the western world a good deal of frustration. But the post-war plan worked.

For the better part of 40 years, "market collapse" and "economic depression" were virtually eliminated from the vocabulary of the west. Best of all, the United States had strong and dependable partners on the global stage. And this was a good thing.

The following, which I wrote about in my book, The Myth of the Free Market, helps to explain how we know a strong and decisive Europe is a good thing. It also helps us understand why President Donald Trump is in over his head, and very deserving of the Macron Swerve.

HOW WE KNOW THE POST-WAR PLAN WORKED
Months before the start of the Second Gulf War in 2003, Secretary of Defense Donald Rumsfeld chided Germany and France for not following the U.S. lead on Iraq – derogatorily referring to their leaders as holdovers from “old Europe.” The claim was both misinformed and full of hubris. Since 1945 Europe had embraced democratic and free market principles, was a solid ally during the Cold War, and pursued economic integration as a way to foment cooperation and allay past tensions in the region. 


Flags of the North Atlantic Treaty Organization (NATO) and the European Union (EU).

Rumsfeld’s comments demonstrated a willful ignorance of how “new Europe” fulfilled, if not exceeded, the aspirations of America’s post-war architects. Old Europe – if we are to get our history right – would not have waited for the U.S. to sweep into the Middle East. In the end, Rumsfeld would have done well to have spoken with General Electric’s former Chief Executive Officer, Jack Welch. He understands “new Europe.” 

During his tenure as CEO Welch merged more than 900 firms with GE. When Honeywell became available in October 2000 Welch went into action. While Honeywell produced many of the same products as GE – plastics, chemicals, electrical machinery, and aircraft engines –Welch was not concerned about anti-trust legislation because he believed Honeywell’s products were “complimentary” rather than competitive. And, besides, why should he worry? He was Jack Welch. 

After getting the green light from the U.S. Justice Department Welch met with Eurocrat, Mario Monti, the European Union’s Director-General for Competition (its “antitrust” division). In Brussels Welch would find “new Europe.” In The United States of Europe T.R. Reid described the introduction: “Welch flashed his friendly, casual smile, stuck out a hand, and said, ‘Mario – call me Jack’ … ‘Mr. Welch,’ [Monti] replied in his accented but precise English, ‘we have a regulatory proceeding under way. I feel the proper approach would be to keep things on a more formal basis. You can call me Sgr. Monti.’” 

Monti’s team had done their homework. They secured information from both GE’s industry competitors and United Technologies (the firm GE outbid for Honeywell). At one point, when asked about aircraft electronic parts manufactured by Honeywell, GE’s team offered only blank stares. And on it went. 

When Monti finally called Welch to tell him the “deal is over” he would end the conversation by saying, “Now I can say to you, ‘Good-bye, Jack.’” 

Fifty-five years after the end of WWII Mr. Welch learned the hard way that the system U.S. post-war architects wanted to build for the world had found a home in Europe. Welch learned something else: By creating the conditions for a prosperous and independent Europe to emerge, America’s grand liberal strategy had – and apparently without Donald Rumsfeld’s knowledge – erased “old Europe.” 

CONCLUDING THOUGHTS

President Trump's actions up to this point make it clear that he has no understanding of Europe, let alone the world. Throw in his complete and utter ignorance of history, and we have what the world sees today: A political imbecile occupying the White House. 

This is why French President Macron's "swerve" to meet the new "leader of the free world," Angela Merkel, is so important. Individual European leaders, and the European Union in general, have caught on to what's happened in America.




Donald Trump is not going to make America great again. He is the poster child for America's relative decline. Fortunately, Europe is in much better shape today to deal with someone like Donald Trump than at any time in its history. 

The Macron Swerve says much more than "I think Trump's a buffoon, so I'm going to say hi to a friend." It also says that the ideas of the post-war victors worked. And for that, we can thank the architects of the post-war world order. 

We should also thank French President Emmanuel Macron for reminding the world that Europe just might be in a better position than we think, and that Donald Trump might not do as much damage as most people fear (at least we hope). 

- Mark

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