US hegemony

Donald’s Populist Moment: Revolt of the Masses or Revolt of the Elites?

/

The gloom in the eyes of the genteel EU folk in Brussels on Wednesday 9 November was a perfect reflection of the city’s rain-filled skies that morning. “The current tenant of the White House is the first Black President of the United States,” a colleague of mine quipped as I passed by his cubicle, “the guy we are getting now is a vulgar clownish buffoon, a Putin’s pal with hands on a nuclear switch.” As smart and talented as my colleague is, what escapes him as well as so many otherwise intelligent individuals of the “EU bubble” is the utter dissatisfaction of people with elites.

It is quite natural that Western political, financial, economic and media elites do not see it, since they are the exact target of the brewing popular anger. To borrow the words of Alain de Benoist, demanding they accept themselves as the root cause of resurgent populism is same as putting in doubt their raison d’être. Being in “shock”, “despair”, or “dumbfounded” about uncouth Donald Trump does not help, however. It only serves to underscore the elites became smug and live in a self-centred bubble to which day-to-day reality does not penetrate.

As non-Western media are too ready to point out, this lack of a capacity for self-reflection is a sign of political immaturity to which many Americans and Europeans have fallen. When I asked our editor Alice Máselníková for a comment, she aptly pointed out that elites pat themselves on the back and nurture each other with neoliberal convictions. They reject any different opinion immediately and without consideration as bigoted, racist, or extremist. If someone disagrees, so the logic goes, it must be only because they are not sufficiently educated or are not equipped with the right facts. If they were, “they would see through.“ Well, there you go, they did not. Now is the right moment to ask why.

Being “dumbfounded” is not a good enough response, says Jonathan Pie and does not mince his words while doing it!

Those who see hope in Trump and populism do not give a damn about all that mocking, eye rolling, crying emojis and emergency plans for emigration to far away lands. If there is something most human beings can agree on, it is that no one likes being treated as an idiot. Note well: Trump did not win regardless of his insensitive and direct utterances, but rather because of them. Pollsters who were putting Hillary Clinton in front of the race until the very last minute (as seen on the forecasts graph from New York Times) did not realise that people were quite likely hiding their political preferences because of fear of being blamed and shamed. Political correctness pushed the dialogue over ideology out of social discourse, to the extent a candidate who expressed himself vulgarly yet frankly, gave people the sense of choice and empowerment.

Chance of Winning Presidency - until Trump started winning, pollsters engaged in wishful thinking. © New York Times
Chance of Winning Presidency – until Trump started winning, pollsters engaged in wishful thinking. © New York Times

Democracy is based on the idea that in civic matters, everyone is equal. If certain criteria such as the age of maturity are met, every citizen has something to contribute to the debate and decision-making. Our life experience is different, each of us fights own battles and is given personal opportunities. Each of us, therefore, is also a bearer of certain wisdom, which does not correlate with profession or the formal level of education. Only if we share our individual wisdom and put it to the scrutiny of others, we can hope to correct for errors and mistakes that are also individual. Czech thinker Petr Robejšek is correct in saying there is a powerful wisdom in the wisdom of the crowds, since a collective offsets excesses made by a single human being.

For that reason, I have little doubt that Trump’s victory will be once written in history books as a fundamental moment of political change. Trump is the first President-elect in the 200-year old American history that did not hold any public or military function. Tremendous opposition from all traditional outlets of the mainstream notwithstanding, American people said no to the establishment and that after decades of electing sanitised and well-spoken presidential candidates who ended up offering zero palpable change. Obama was the last establishment candidate in whom people put their trust, only to see him put Citigroup and Goldman Sachs grandees on top posts in his Cabinet. Unsurprisingly, this betrayal had its political consequences: former Obama strongholds firmly sealed the election’s result when they turned to Trump.

Triumph of populism

It is not so much Donald Trump who is the winner of this election, as the anti-establishment movement as such. In fact, history was already made when Trump became the Republican candidate and when Bernie Sanders made such an excellent performance during Democratic primaries. Someone for once addressed head on problems connected to immigration and globalised economy. The Trump phenomenon is about breaking the rule that some things should not be spoken about. As disgraceful as Trump’s comments about women or Muslims were, these kinds of words are heard by people everyday, be it among “their buddies”, in a supermarket, or at their work on a construction site. While the form may and should be certainly questioned, it remains clear that Trump spoke in an understandable language about topics that concern people on the street.

Hillary Clinton and the establishment were certain they will have the White House. This witty video leaves them astonished as “mad dog” Donald snatches the coveted prize instead.

It is a triumph of populism, albeit with Trump of a xenophobic kind. Populism, however, is not an ideology but a political style. It is also not synonymous with demagogy, as populists and elitists alike are perfectly capable of deceiving the people. Ernesto Laclau defines populism as a political disposition through which people constitute or reconstitute themselves as a historical actor, starting from the moment characterised by antagonistic plurality of views. Populism is thus fundamentally linked to democracy. In the US, such a moment is becoming increasingly visible as the clash between the establishment and its neoliberal ideology of globalisation, and forces that to various extent question such fundamentals. As the traditional dichotomy between political left and right increasingly loses importance, it is being replaced by the division between “up” (elites) and “down” (people).

Trump represents the vulgar sort of populism and his political style managed to capture the anger of white working and middle-classes of the American Midwest. Formerly an industrial heartland of the United States, it was the area hardest hit by the outsourcing of jobs to cheaper locations in Asia. Wisconsin, Michigan, and Pennsylvania had not voted for a Republican candidate since the 1980s, and most polls showed Clinton ahead by comfortable margins in those states. Ohio went for Obama in the last two presidential elections, as did Iowa. Trump won them all.

Changing social landscape due to influx of migrants, bursting of the housing bubble, and unaffordable education and healthcare that were not solved by any of the neoliberal “reformists” further added voters to the Trump camp. Vote for Trump meant a vote against Washington and against hollow moralising of corrupt elites that rely on their hold at institutions to push forward their own agenda. In one word against everything that the Clinton family symbolically represents. If Trump did not present himself as a xenophobe (as well as a misogynist) and appealed directly to African and Latin Americans of both sexes, his support would have been undoubtedly much higher still. Even then, as can be seen in the chart below, compared to Mitt Romney in 2012, his support among Hispanic voters increased by 2% to 29%. His highly antagonising rhetoric notwithstanding, he even gained some support among black voters, Jewish Americans or American Muslims.

Which voters won it for Trump: Comparing exit polls from 2012 to 2016. © The Telegraph
Which voters won it for Trump: Comparing exit polls from 2012 to 2016. © The Telegraph

Entirely another question is if the controversial figure of Donald Trump can fulfil his voters expectations. For once, he never expressed his policy with any great clarity and there are some indications that his attitude might change when he enters the White House. While he reaffirmed his commitment to “build the wall with Mexico”, his tone during the victory speech was calm and conciliatory. His Cabinet is also likely to include some well-known establishment figures. He is also a “capitalist par excellence” and one cannot expect that the United States will turn on Wall Street, but this largely reflects the economically liberal nature of American populism. It remains to be seen to what extent Trump’s rejection of environmental policies, widespread deregulation, reducing corporate tax from 35% to 15%, or return to more private healthcare is capable of answering popular calls for a more just society.

On the other hand, Trump offers some sympathetic policy proposals such as large-scale investments into infrastructure to secure jobs, an amnesty for the repatriation of big companies’ money from overseas, or protectionism against dumping prices of Chinese imports. All the above taken together, Trump and his team believe, should deliver a big fiscal stimulus to the American economy. The promise of higher investments were positively taken up by financial markets, which quickly jumped up from the initial “shock” of Trump’s victory, notwithstanding predictions to the contrary from such economists like Paul Krugman.

European tragicomedy?

And what about Europe? The European Union does what it knows best: on Sunday it organised another summit. This time it was a “panic dinner” where these political pygmies, so-called European leaders, struggled to find a response to a turnaround in American foreign policy. Rather than having a normal political reaction, the EU behaves like a company board that suddenly lost its CEO.The outcome of this meeting was predictable – the EU’s foreign policy chief Federica Morgherini issued a bland comment that “values, principles, interests” will continue to form the basis of the transatlantic partnership. European citizens, please translate: waste of your tax money.

More interestingly, the meeting seemed to have been snubbed by the UK, France and Hungary. Financial Times reported that “British foreign secretary Boris Johnson dropped out of the Brussels meeting, with officials arguing that it created an air of panic, while French foreign minister Jean-Marc Ayrault instead opted to stay in Paris to meet the new UN secretary-general. Hungary’s foreign minister boycotted the meeting, [labelling] the response from some EU leaders as ‘hysterical’.” One is entitled to ask if the EU is showing first cracks in its façade.

Meanwhile, Jean-Claude Juncker, President of the European Commission infamous for his drinking antics and former career stint in facilitating tax evasion as Luxembourg Prime Minister, wants to teach Trump “what Europe is and how Europe works”. Perhaps Mr Juncker should be reminded by his advisors that at least as far as Central Europe is concerned, Trump knows it better than him. His Czech ex-wife Ivana Trump is poised to become Ambassador to the Czech Republic and their children speak at least some level of Czech.

Federica Mogherini, the EU foreign policy chief, and Luxembourg Foreign Minister Jean Asselborn during a press conference. EU's foreign policy statements became infamous for their lack of any clear political message. JOHN THYS/AFP/Getty Images
Federica Mogherini, the EU foreign policy chief, and Luxembourg Foreign Minister Jean Asselborn during a press conference. EU’s foreign policy statements became infamous for their lack of any clear political message. JOHN THYS/AFP/Getty Images

What European politicians cannot process is that Donald Trump openly admitted that he would put “America First”, make reasonable deals with Russia’s Vladimir Putin, and fight alongside Bashar al Assad in Syria. In other words, he is completely reversing the decades of American liberal interventionism in global affairs. Since so many politicians in Europe made their career out of thoughtless pursuit of American political interests, it will be extremely interesting to see how they will react when they find themselves facing a President beating to a different tune.

Merkel, Hollande, Juncker and others spent last several months insulting and lecturing Trump at every opportunity, yet now they will have to back down and sit with him at international summits. Also various sorts of media commentators and “think tanks” openly wished that Clinton took up the reins and continued the bellicose stance towards Russia that would have made the world at the very best an extremely unstable place. In this context it should not be forgotten that “the non-flying zone” in Syria proposed by Clinton would lead to a war with Russia. It is unlikely these organisations will change the tone as George Soros and others will continue in their hefty funding. Will they now advocate that Trump is overthrown, so that the promotion of the American liberal hegemony at gun barrel point may continue unrestrained?

One should remain cautious about expecting (or fearing) too much from Trump, as he will be inevitably constrained by the Supreme Court as well as by Congress and powerful military-industrial complex. It also has to be noted that most of the Republican party does not support at all Trump’s realistic approach to international affairs. Especially through the figure of Mike Pence, future Vice-President, they will try to continue in the course of global interventionism.

The great hope is that the change in American foreign policy may ultimately be good for Europe. Since European politicians completely showed the utter lack of capacity to promote Europe’s sovereignty and independence, Trump’s withdrawal of support for NATO might do it for them. The EU may be very well forced to rely on its own means for defence, which would be an ironic achievement after the decades that the Americans spent on undermining Europe’s efforts to do so.

Last but not least, it becomes clear that liberal democracy with its focus on more of the same (political correctness, consumerism, corporate globalisation, disrespect for collective identities, preferential treatment of minorities to the problems of majority), does not offer solutions to social problems that we have also in Europe. The essential question is if the elites realise that and work together with people in solving their problems in a manner that is fully democratic, without demagogy and false promises, and just to all citizens without distinction. If they do not, and it would be due to their stupidity, greed and short-sightedness foremost, more and more extreme and extremist individuals will get elected into power also in Europe. Already in the 1990s American thinker Christopher Lasch spoke of the revolt of the elites, and that, I think, not the revolt of the people, is a fair assessment of the current situation.

Embargo on Iranian oil: A move to save the US Dollar hegemony

/

US Dollar Hegemony pictured as a harvester with uncle Sam sitting behind the driving wheel that is on the way to run over the escaping globe @ Dollar Hegemony by Luojie, China Daily, China from www.caglecartoons.com # 85448Acting through its ambassadors, the European Union has announced the imposition of an oil embargo on Iran from July 2012 on as well as placement of sanctions against Iran’s Central Bank, which aim to disrupt the funding of the country’s nuclear programme. But will that suffice? Will it have any effect? Or will it rather be importers bearing the costs? In response to the declaration of the embargo, the Brent price of oil skyrocketed between 23rd and 29th January to $111 per barrel.1 Iran is the second largest producing country in OPEC that supplies 2.5 million barrels per day, out of which 450 thousand are sent to EU countries. If the stoppage of the Iranian supply is not substituted by some alternative source, the embargo on the trading of Iranian oil can significantly harm European economies.

The Oil from Saudi Arabia

Speaking through its Commissioner for Energy Günther Oettinger, the European Union boldly announced that imports from Saudi Arabia will cover the Union’s consumption needs. A difficulty lies in the fact that relying on the oil reserve capacity of Saudi Arabia, which has always played the role of a safety measure, is becoming increasingly problematic. Even a short disruption of the drilling of oil in Algeria, and in Libya during the recent civil war, were sufficient to deplete Saudi reserve capacities.

When Wikileaks published diplomatic cables in 2010, what many analysts had been claiming for some time became public: Saudi Arabia has been lying about its oil reserves. They are lower than it officially claims. As everything indicates, it won’t be in the position to extract more than 12 million barrels a day. Given that the whole world experiences increasing demand, this will push up the prices of black gold to yet unprecedented heights. Oil will keep flowing even without Iran, but then we should not be surprised when the price will jump to somewhere between $120 to $150 per barrel during the summer.

Let’s look at the issue from a different angle. Who can lose out on the disruption of Iranian oil supply is obvious. It won’t be Russia, China, India, nor Turkey, but the European Union. (Allegedly, Japan will only decrease the level of supply.) Iran will now have to sell to these countries for a lower price. Higher prices will be especially beneficial to Saudi Arabia, which needs expensive oil in order to have sufficient funds for bribing its inhabitans, whose uprising would cause a true Arab spring and large problems to the United States, which are publicly supported by the Saudi regime that also allows them to build strategic military bases on its soil.

What really bothers the Americans

According to the treaty between the US and Saudi Arabia from the early 70s, the trading in oil with OPEC is concluded exclusively in US dollars (the famous term „petrodollars“ emerged as the result of the treaty). It is quite simple, really: if you ensure that oil will be traded in US dollars only, the countries needing oil for their economy’s development will be forced to obtain your currency. And this is exactly the reason why the American FED can today print dollar banknotes on big scale.

In the 30 years of functioning of the petrodollar system, the US has run a semi-monetarist trade regime, which has in practice entailed that in exchange for its goods, a country in question has received printed dollars. Besides being highly profitable to the US, the country’s foreign trade could prioritise import over export, leading to a decreased demand for the production of export goods.

This model could predominate only as long as the international political standing of the United States was unshakeable. But as the importance of new seats of power of the East and South increases, the appetite for a new, more just global ordering grows too. Emerging economies that have huge consumption of oil suddenly feel that dollar is detrimental to their growth and want to get rid of it. On the other hand, for the US a breakthrough of euro, juan or yen as the means of exchange would entail that they would have to quickly balance out their trade deficit – and for the largest economic entity in the world this would mean a several years long, painful transition.

When mentioning Iran it is useful to remember the fate of its Iraqi neighbour (indeed, among other countries). Since it is highly interesting that the accusation that Iraq own weapons of mass destruction came few months after Saddam Hussein announced that he will sell oil exclusively in euro. The bizarre leader of Libya, Muammar Kaddafi, was on friendly terms with Western politicians for years and no one was concerned too much by repressions against opposition – not until the moment when he announced the plan to create a pan-African oil trading regime, which hoped to force out the US dollar by creating the “African denari”.

In the past, Iran tried to weaken the dollar’s influence on trade and minimise the dollar transactions made for its oil, and at the end of 2008 it completely succeeded thanks to the founding of the Iranian oil commodity exchange. Japan pays for oil in yens, while others in euro.

To facilitate transactions for oil exports to India, Iran recently concluded a treaty with two important Indian banks. And in order to avoid any disputes with the US, Iran has chosen banks that have no direct engagement with the United States. Russian Gazprombank is expected to play the role of an intermediary. Latest information so far indicate that India has  agreed to this unprecedented deal and thus became the first recipeint of Iranian oil who will pay for the supply in gold instead of by dollar.

If joined by China, this initiative will have yet unforeseeable consequences. Gold once again starts to fulfill the role of currency and the United States watch this development with unease. Since more than by the alleged Iranian nuclear programme, they are threatened by a collapse of the dollar’s hegemony. The explanation for the present war drumming and dispatching of flotillas to the Persian Gulf can thus also be an effort to get rid of the weakest link on the ‘anti-dollar front’ that would send to Russia and China a first, but resounding warning signal.

 

* Translated from Czech by Stanislav Maselnik. Originally published on Revue Politika.

Show 1 footnote

  1. Brent is a trading classification of a kind of crude oil sourced from the North Sea that serves as a major benchmark for petroleum production from Europe, Africa and the Middle East.