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Merkel may be down, but don’t rule her out for a fourth term just yet

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Germany’s chancellor since 2005, Angela Merkel is widely believed to be preparing to seek fourth term in the 2017 federal elections. (Facebook)

It’s entirely possible that September 2016 marks the worst month of German chancellor Angela Merkel’s career.Germany Flag Iconmecklenburg-vorpommern berlin

Merkel’s center-right party, the Christlich Demokratische Union (CDU, Christian Democratic Union) fell to third place in Mecklenburg-Vorpommern, a relatively low-population state of just 1.6 million that sprawls along the northern edge of what used to be East Germany. While the center-left Sozialdemokratische Partei Deutschlands (SPD, Social Democratic Party) has been traditionally stronger there in elections since reunification, two factors made the CDU’s loss particularly embarrassing. The first is that it’s the state that Merkel has represented since her first election in 1990 shorly after German reunification. The second, and more ominous, is that the CDU fell behind the eurosceptic, anti-refugee Alternative für Deutschland (Afd, Alternative for Germany), a relatively new party founded in 2013 that today holds seats in 10 of Germany’s 16 state assemblies and that, according to recent polls, will easily win seats in the Bundestag in next September’s federal elections.

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Two weeks later, on September 18, Merkel’s CDU also suffered losses in Berlin’s state election. As left-wing parties have long dominated Berlin’s politics, and the SPD placed first and Germany’s Die Linke (the Left) and Die Grünen (the Greens) placed third and fourth behind the CDU. But even in Berlin, the AfD still won 14.2% of the vote.

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Taken together, the state election results forced a mea culpa from Merkel on Monday. The chancellor, who is expected (though by no means certain) to seek a fourth consecutive term next year, departed from the calm, steely confidence that since last summer has characterized her commitment to accept and integrate over a million Syrian refugees within Germany’s borders. Merkel admitted, however, that she would, if possible, rewind the clock to better prepare her country and her government for the challenge of admitting so many new migrants, and she admitted lapses in her administration’s communications. With the AfD showing no signs of abating, it’s clear that its attacks on Merkel’s open-door policy are working. Merkel’s statement earlier this week admitted that her policies have not unfolded as smoothly as she’d hoped.

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RELATED: Can Hillary Clinton become America’s Mutti?

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Indeed, German polls are starting to show that voters are souring on Merkel and her approach to migration, so much that in one poll in August for Bild, a majority of voters no longer support a fourth term for Merkel. All of which has led to hand-wringing both in Germany and abroad that Merkel’s days are numbered.

Don’t believe it. Continue reading Merkel may be down, but don’t rule her out for a fourth term just yet

Fico loses majority as ultranationalists enter Slovakia’s parliament

Despite prime minister Robert Fico's increasingly strident anti-immigration line, a minority of Slovakian voters turned to a virtually neo-Nazi party in March 5 elections. (Facebook)
Despite prime minister Robert Fico’s increasingly strident anti-immigration line, a minority of Slovakian voters turned to a virtually neo-Nazi party in March 5 elections. (Facebook)

It’s not just the United States and western Europe facing down the threat of xenophobia.slovakia flag

Slovakia’s voters on Saturday delivered a victory to prime minister Robert Fico and the center-left Smer–sociálna demokracia, (Direction/Social Democracy), which has governed Slovakia since a landslide win in 2012.

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But Fico, who lost a 2014 presidential bid to businessman Andrej Kiska, saw his majority eliminated, and Smer-SD will hold just 49 of the 150 seats in the Národná rada (National Council).

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Meanwhile, an openly ultranationalist, far-right party, Ľudová strana – Naše Slovensko (L’SNS, People’s Party/Our Slovakia), accurately described as a neo-Nazi party, won 8% of the vote and 14 seats in the new parliament after waging a campaign attacking not only the waves of African and Middle Eastern migrants arriving in Europe, but NATO, the European Union, the European security alliance with the United States and same-sex unions.  Continue reading Fico loses majority as ultranationalists enter Slovakia’s parliament

Is Donald Trump the American version of Le Pen?

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Over the weekend, Le Figaro pondered whether Donald Trump, the tart-tongued real estate mogul, might be the U.S. version of Jean-Marie Le Pen, the French far-right founder of the Front national (National Front) who’s also become notorious for controversial statements and for trampling ‘political correctness.’USflag

Le Pen, after all, edged out the leftist prime minister Lionel Jospin in the 2002 presidential election, establishing the Fifth Republic’s most lopsided runoff between the noxious Le Pen and the incumbent, center-right Jacques Chirac. Le Pen’s daughter, Marine Le Pen, who is working to broader the FN’s appeal, is polling high in the 2017 presidential contest and may win one of the two final runoff spots.

There are significant differences between the Le Pen family and Trump. Le Pen pere frequently expressed his doubts about the Holocaust with a heavy dose of anti-Semitic populism — so far, Trump hasn’t started questioning the Holocaust or attacking Jewish Americans. But both Le Pen and his daughter developed a significant constituency of French voters by expressing outrage against the influx of immigrants into the country, a concern much closer to Trump’s heart (he announced his candidacy by attacking Mexicans, promising to build a wall along the southern US border and billing it to the Mexican government).

More recently, Marine Le Pen has broadened her attacks to include European institutions, including the eurozone, as an attack on the sovereignty of France. In her exclamations of “Oui, la France!” there’s more than an echo of Trump’s “Let’s make American great again” shtick.

But the support that Trump has amassed in the summer of 2015 isn’t so unlike the wave of populism that’s enveloped Europe (on both the right and the left). Though the US economic recovery has chiefly outpaced that of Europe’s, it’s not been an easy expansion. Sustained unemployment, tepid GDP growth and stagnant wages have left working-class and middle-class American voters less secure — just like working-class and middle-class European voters.

It’s no surprise that since 2010, several new voices of the populist right and the populist left have demonstrated their electoral muscle:

  • In Italy, comic and blogger Beppe Grillo obtained nearly a quarter of the vote in the 2013 elections, and polls show that he still commands upwards of 25% of the vote. Frank Bruni wrote in May in The New York Times that Trump shares much in common with Silvio Berlusconi, the media tycoon who dominated Italian politics from the mid-1990s to the late 2000s and, like Trump, reveled in controversial pronouncements. But Berlusconi was primed for politics by Bettino Craxi, the Socialist prime minister in the 1980s who was ultimately forced into exile in Tunisia; it’s not like George W. Bush or Newt Gingrich developed Trump as a protégé.
  • In the United Kingdom, anti-establishment candidates running for the Scottish National Party (SNP) wiped out longstanding Labour and Liberal Democratic strongholds in Scotland and, in the current Labour Party leadership contest, the far-left Jeremy Corbyn, a firm anti-austerian who wants to renationalize British railways, leads many surveys against more moderate opponents.
  • In Greece, the far-left Alexis Tsipras and SYRIZA (Συνασπισμός Ριζοσπαστικής Αριστεράς, the Coalition of the Radical Left) took power in January’s elections, and the equally far-left Podemos hopes to pull off a similar victory in Spain’s general election in December.

It’s not surprising that economic pain, angst about sovereignty, identity and migration and other doubts about ruling political elites are fueling the same kind of anti-establishment reaction in the United States, too, and it’s the same instinct that powered the ‘tea party’ movement of the early 2010s.

It’s too soon to tell what Trump’s lasting legacy will be on the 2016 presidential race. His poll numbers might soon collapse (or not). He could wipe out before the first votes are cast in the Iowa caucuses or the New Hampshire primary. He might win a few early contests before Republican elites step in (and they will) to deny him the presidential nomination. He’s still holding the door open to an independent third-party run in the general election.

But the real template for Trump isn’t necessarily Le Pen or Tsipras or Corbyn or Grillo or even Berlusconi, though they all draw support from the same anti-establishment, populist reservoir.

Instead, it’s a duo of neophyte businessmen who have taken on powerful (and experienced) political leaders over the past two years to upend the status quo. Though Andrej Kiska and Andrej Babiš aren’t necessarily household names, even in Europe, they represent more closely the kind of appeal that Trump — at his best, perhaps — could replicate to upend the Republican establishment.

If I were Corey Lewandowski, Trump’s campaign manager, I would be furiously studying each case to extrapolate lessons for Trump.

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Kiska (pictured above) is a 52-year old businessman who spent much of his life as a entrepreneur in Slovakia, making his fortune in the installment payments and the credit business. Despite his failures to break into the US market, Kiska shifted to charitable works in 2006, founding Dobrý anjel (Good Angel), a charitable organization that provides funds for the seriously ill.

Running as an independent in the Slovakian presidential election in March 2014, Kiska defeated Slovakia’s sitting center-left prime minister Robert Fico. The Slovak presidency is effectively ceremonial, but Fico’s victory would have consolidated power between the ruling party and the presidency. Fico’s defeat dealt an otherwise popular figure a significant blow — and Kiska’s victory preserved a sense of constitutional balance between the executive and the parliamentary.

Going into the election, Fico was a well-liked prime minister and Slovakia’s economic record outpaced its closest neighbors; Kiska was a political newcomer. Fico’s party, Smer–sociálna demokracia, (Smer-SD, Direction-Social Democracy), still widely leads polls for next year’s general election, for example.

Unlike Trump, Kiska didn’t campaign on the macho, alpha-male persona of a successful businessman. But Kiska succeeded by planting doubts about Fico’s campaign and the fact that Kiska was personally untainted by political corruption and ties to Soviet-era politics. By all counts, he’s thrived in the presidential role since taking office last year. The lesson to Trump is that he can dial down the antics and still present a capable challenge to the GOP establishment. Though Trump may embellish the influence that his past donations might have procured, there’s no doubt he is right when he showcases the corrosive influence of money on politics in the post-Citizens United world.

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Babiš (pictured above) is also a Slovak-born businessman, but the 60-year old made his fortune in the Czech Republic. Like Kiska, he left business to form a political party, Akce nespokojených občanů (ANO, Action of Dissatisfied Citizens) in 2011.

In the 2013 Czech elections, ANO won nearly 20% of the vote, finishing a strong second to the Česká strana sociálně demokratická (ČSSD, Czech Social Democratic Party) in a highly fragmented result. Babiš, who developed Agrofert, an agricultural and food processing company, into one of the most successful companies in the country, later purchased a series of media companies before he turned to politics as one of the wealthiest men in the Czech Republic. Not surprisingly, Babiš argued that he would govern the Czech Republic like a business.

More caustic than Kiska, and more sympathetic to neoliberal policies, Babiš attacked both Czech social democrats and conservatives as corrupt and dishonest, arguing for an end to immunity for political figures. In 2012 and 2013, despite his inexperience, he expertly filled a void for an electorate that had lost trust in the central European country’s ruling elite. In that regard, Trump’s rhetoric much more strongly resembles that of the pugilistic Babiš.

In the past four years alone, a center-right prime minister resigned after his chief of staff (with whom he had become romantically involved) was caught spying on the former prime minister’s wife. It’s also a country where a former Social Democratic prime minister won the presidency in early 2013 and immediately tried to outmuscle the Czech parliament in a constitutional power struggle. That gave Babiš the opportunity to present himself as the truth-telling man of action, despite fears that ‘Babišconi’ would become just another oligarchic leader and despite troubling accusations that he cooperated with the Czech internal police during the Soviet era as well as with the Soviet KGB.

Nevertheless, after the 2013 election, Babiš  set aside his differences with elites and brought ANO into the current government — he now serves as the country’s finance minister. Though the next Czech elections do not have to be held until 2017, ANO leads polls and there’s a good chance that Babiš could become the next prime minister.

The lesson here from Trump is that the righteous ‘pox-on-both-your houses’ anger of the outsider can be effective so long as it’s targeted on the tangible excesses and failures of the ruling class. But it’s not enough, as Trump has done, just to call yourself ‘smart’ and politicians ‘stupid.’ What made Babiš successful was presenting the devastating case for why Czech politics had become so broken.

 

Iohannis upsets Ponta in Romanian presidential election

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It’s becoming a more German Europe in more ways that one.Romania Flag Icon

In a stunning upset victory, Sibiu mayor Klaus Iohannis, an ethnic German, defeated prime minister Victor Ponta, in Sunday’s Romanian presidential election, challenging confident predictions that Ponta would easily take the presidency.

Ponta’s center-left Partidul Social Democrat (PSD, Social Democratic Party), dominated both the December 2013 national parliamentary elections and the May 2014 European parliamentary elections, and Ponta entered the runoff as the prohibitive favorite after a resounding victory in the October 2 first round, when he took 40.44% of the vote to just 30.37% for Iohannis, the new leader of the center-right Partidul Național Liberal (PNL, National Liberal Party).

But Ponta’s 10-point lead disguised the fact that he fell 10% short of an absolute majority and, as voters’ minds focused on the runoff, Iohannis gained from a surge in turnout — from around 53% in the first round to over 64% in the runoff.

That’s despite the endorsement that Ponta won from third-place challenger, Călin Popescu-Tăriceanu, a former PNL leader and the country’s prime minister between 2004 and 2008, who founded the Partidul Liberal Reformator (PLR, Liberal Reformist Party) in July, helped boost Iohannis to an unexpectedly wide margin of victory — 54.50% to just 45.49% for Ponta.

Iohannis, a physics teacher by training, has served as mayor of Sibiu, a city in Transylvania, since 2000, and he led the relatively small Forumul Democrat al Germanilor din România (FDGR, Democratic Forum of Germans in Romania) from 2002 to 2013. As outgoing incumbent Traian Băsescu receded from the spotlight after a decade as president, Iohannis assumed the leadership of the PNL, the larger of Romania’s two major opposition parties, though Iohannis also had the support of Băsescu’s Partidul Democrat-Liberal (PD-L, Democratic Liberal Party).

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Though the PNL joined forces with Ponta (pictured above) in 2011 to form the Social Liberal Union, it left the coalition in February 2014 to enter opposition, eyeing an alliance with the PD-L. When the PNL suffered disappointing losses in the May European elections, however, its leader Crin Antonescu stepped down, paving the way for Iohannis to reboot the party and become the joint PNL/PD-L presidential candidate.

Though ethnic Germans settled much of Transylvania, including the city of Sibiu, two waves of German exodus, first after World War II and again after the end of the Cold War and the fall of the Iron Curtain, have left few German-speaking enclaves in Romania. Today, just over 4% of Romanians are ethnically German. Continue reading Iohannis upsets Ponta in Romanian presidential election

A detailed look at the European parliamentary election results (part 3)

Nearly a week after the European elections, the reverberations are still shaking the entire continent, on at least two levels — the consequences of the historic level of eurosceptic parties elected across Europe and in terms of the growing battle between the European Parliament and the European Council over electing the next European Commission president. European_Union

In the first part of a Suffragio series examining the results of the May 25 European parliamentary elections, I focused on the five most populous countries in the European Union: the United Kingdom and France, where eurosceptic parties won the greatest share of the vote; Germany, where chancellor Angela Merkel won another strong victory; Italy, where prime minister Matteo Renzi won a near-landslide mandate just three months into his premiership; and Spain, where both traditional parties lost support to a growing constellation of anti-austerity movements — so much so that Alfredo Pérez Rubalcaba, the leader of the Partido Socialista Obrero Español (PSOE, Spanish Socialist Workers’ Party), Spain’s traditional center-left party, resigned

In the second part, I examined the results in nine more countries — Poland, Romania, The Netherlands, Belgium, Greece, the Czech Republic, Portugal, Hungary and Sweden.

In the third and final part, I examine the results in the remaining 14 countries of the European Union. Continue reading A detailed look at the European parliamentary election results (part 3)

Kiska elected president of Slovakia in setback for Fico

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Robert Fico’s attempt to extend his control over both the Slovakian parliament and presidency failed Saturday, when former businessman and philanthropist Andrej Kiska (pictured above) overwhelmingly defeated Fico in the second-round runoff.slovakia flag

Though Fico narrowly led in the first round, Kiska won a decisive victory with 59.38% of the vote. Fico, the incumbent prime minister, won just 40.61%. Kiska, an electrical engineer by training, made his fortune in the installment payments / credit business. Eight years ago, he founded Dobrý anjel (Good Angel), a charitable organization that helps provide funds for the seriously ill.

Kiska’s victory parallels the rise of Andrej Babiš, also a former businessman, who became the deputy prime minister and finance minister of the Czech Republic after his new center-right party nearly won last October’s Czech parliamentary elections. Babiš, interestingly enough, is Slovak by birth. Though Kiska will have a relatively circumscribed role in Slovak politics, due to the largely ceremonial nature of the Slovak presidency, the emergence of figures like Kiska and Babiš could augur the rise of a new, pragmatic center-right in central Europe whose leaders come from the business world and not from the fraught economics and tainted politics (on both the right and the left of the immediate post-Cold War period).

Fico, the leader of Slovakia’s main center-left party, Smer – sociálna demokracia (Direction — Social Democracy), has led the country’s government for six of the past eight years. His defeat on Saturday will undoubtedly weaken his position as prime minister, given that his critics can argue the election was a referendum on Fico’s record. Smer won’t face voters again until 2016, but it was Fico’s choice to contest the presidential election, making his defeat on Sunday almost entirely self-inflicted.  Continue reading Kiska elected president of Slovakia in setback for Fico

Fico, Kiska advance to Slovak presidential runoff

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Slovak prime minister Robert Fico led in the first round of the country’s presidential election on Saturday, but he’ll face stiff competition in the March 29 runoff from political neophyte Andrej Kiska.slovakia flag

Fico won 28.0% of the vote and Kiska took 24.0% — both contenders were expected to finish in the top two spots and advance to the final round.  The big surprise in Saturday’s election, however, was the strength of third-place finisher Radoslav Procházka, a Christian democratic independent who won 21.2% of the vote.  Milan Kňažko, an actor, also a Christian democrat, and a top Slovak leader of the 1989 Velvet Revolution, won 12.9% of the vote.

The results mean that Fico (pictured above) will face a very tough time winning an absolute majority against Kiska in two weeks’ time.

The outcome of the election itself isn’t as significant as the surrounding context.  Slovakia’s presidency is essentially ceremonial, though the president formally nominates the prime minister and some members of Slovakia’s constitutional court and other judicial offices.  Though the president can veto routine bills passed by the unicameral Národná rada (National Council), a simple majority of the National Council can override the presidential veto.

That means that the Slovak presidency is much more like the ceremonial German presidency instead of the truly powerful French presidency — and even, from a constitutional perspective, weaker than the Czech presidency.

Accordingly, the election is important for two reasons.  First, the election has now become a referendum on Fico and his governing center-left party, Smer – sociálna demokracia (Direction — Social Democracy).

Second, if Fico wins, his elevation to the presidency will necessitate the selection of a new prime minister and government.  Continue reading Fico, Kiska advance to Slovak presidential runoff

Why is the Slovak economy doing so much better than the Czech economy?

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Former Czechoslovakia is very much in the news this month, with January 1 marking the 20-year anniversary of the split into the Czech Republic and Slovakia, and with the upcoming Czech presidential election.slovakia flagczech

But one of the more interesting questions in 2012 and in 2013 has been the variance between the Czech economy and the Slovak economy.

Given that the Czech Republic, which still uses the koruna as its currency, retains full monetary policy independence, and that Slovakia has been a member of the eurozone since 2009, you might expect the Czech economy to be in a better position, given that Greece, Spain, Italy and other countries in Europe have suffered greatly from being shackled through their membership in the eurozone.  That seems especially true considering that the eurozone’s one-size-fits-all monetary policy was too loose for the eurozone periphery before the 2008 financial crisis and now seems, despite European Central Bank president Mario Draghi’s best efforts, too tight today.

Yet the result is exactly the opposition — the Czech economy, growing at a relatively weak 1.7% in 2011, fell into a shallow contraction in 2013, while the Slovak economy continues to grow — 3.3% GDP growth in 2011 and around 2.5% growth in 2012.

So what explains the difference?  I see three dynamics in particular:

First, given that Slovakia was always less developed than what’s now the Czech Republic, there’s simply more low-hanging fruit.  The Czech economy (in PPP terms) is $286 billion, while Slovakia’s economy is just $132 billion.  On a per capita basis, Czechs, with a GDP per capita of just over $27,000, are still better off than Slovaks, with a GDP per capital of just over $24,000.  But that’s not such an incredible gap, and so I’m not sure that necessarily explains the disparity in GDP growth.

Secondly, and this is probably related to the first point, the relatively recent entry into the eurozone has likely boosted the Slovak economy in the short term, reducing the transactions costs of trade with the rest of western Europe, upon which both Slovakia and the Czech Republic depend for much of their export growth.  The Slovakian automobile industry, in particular, continues to fuel the country’s export strength.

Finally, we can look to economy policymaking — while the center-right Czech government has been focused on budget austerity, the social democratic Slovak government has been much more liberal with respect to using government as a tool to boost growth, despite the fact that both countries carry a public debt of a bit over 40% of their respective GDPs.    Petr Nečas, the Czech prime minister since 2010, and the leader of the Občanská demokratická strana (ODS, Civic Democratic Party) that dominates the center-right governing coalition, has faced massive protests in the face of an austerity program that’s features not only tax increases, but painful spending cuts and reductions in government services.

Conversely, although Slovakian prime minister Robert Fico, the leader of the Smer – sociálna demokracia (Smer-SD, Direction — Social Democracy), has pursued tax increases since taking power in March 2012 on a wave of discontent over austerity.  A previously flat tax of 19% will become a little more progressive, with an upper limit of 25% for the wealthiest taxpayers.  Meanwhile, his government has attempted to shield the poorest Slovakians from additional spending cuts (and conceivably, they are the economic actors most likely to benefit from — and spend — each marginal euro of support from the government, thereby boosting aggregate demand).  Fico has furthermore boosted budgetary funds for transport infrastructure and for equalizing educational opportunities throughout all regions of Slovakia.

It’s also worth keeping in mind that unemployment remains much higher in Slovakia — around 14%, nearly doubling the rate of between 7% and 8% in the Czech Republic, and it’s even worse among the poorer eastern parts of the country and among the disadvantaged Roma minority group.

GDP growth is not the only factor that determines the economic health of a country, and the Slovak government has not been successful in eliminating what appears to be a longstanding structural unemployment problem — at its lowest just before the 2008 financial crisis, the Slovak rate was 8.8%.

Photo credit to Kevin Lees — photo taken in Prague in December 2005.