Europe/Americas update: September 26 2018



Around 100 people protested on Wednesday in the city of Magas, capital of Russia’s Ingushetia region. The regional government has apparently cut a deal with the Chechnyan regional government over some sort of minor land swap, which triggered the correspondingly minor public outcry.


Secessionist Bosnian Serb President Milorad Dodik has suddenly stopped talking about secession now that he’s trying to win election to the country’s three-person presidential council. Funny how that works. Dodik now says he’s not opposed to Bosnia, he just really wants to maintain the Serbian autonomy that was codified in the 1995 Dayton Agreement that ended the Bosnian War. That agreement included a constitution that expressly prohibits either of Bosnia’s two regions from seceding. Dodik, who has long opposed a Bosnian bid to join NATO, says that as part of the presidency he would support an effort to join the European Union.


Though her governing coalition is hanging together by a thread, things are looking fairly bleak for German Chancellor Angela Merkel. Her close intra-party ally, Volker Kauder, was ousted on Tuesday from his long-time gig as the parliamentary floor leader of Merkel’s CDU/CSU alliance, despite calls for support from both Merkel and CSU party leader/Interior Minister Horst Seehofer. If nothing else this is a sign that Merkel just doesn’t hold much sway anymore within her own party. The bloc’s new floor leader, Ralph Brinkhaus, isn’t a Merkel opponent as such, but the fact that he got the job at all against her endorsement should be troubling enough from her perspective.



After a couple of weeks’ worth of talks, the Argentine government has managed to negotiate its bailout loan from the International Monetary Fund up from a whopping $50 billion to a really whopping $57.1 billion, the largest loan the IMF has ever made. Argentina has already taken possession of $15 billion of the money. The loan is meant to stabilize the Argentine peso, which is in free fall, even though one of the IMF’s conditions is that the country’s central bank promises not to intervene to boost the currency unless it drops even further.


Another Brazilian opinion poll shows Workers’ Party candidate Fernando Haddad surging ahead of next month’s presidential election. The new Ibope survey has Haddad in second place at 21 percent in the first round, only six points behind frontrunner Jair Bolsonaro, and has Haddad leading Bolsonaro in a runoff, 42-38. I kind of expect some movement toward Bolsonaro in a runoff, as Brazil’s oligarchs throw their support behind the fascist running against the guy who wants to raise their taxes a bit. So that lead doesn’t strike me as especially secure with 20 percent apparently still undecided. But that’s just me.


Of all the harangues Donald Trump had to sit through during his UN Security Council session on Iran nonproliferation, none was apparently as intense as the one he got from Bolivian President Evo Morales, who went on at length about the abuses of past US governments as well as Trump’s

While representatives of some of the nations present at the meeting offered critical comments about Trump’s foreign policy — and in particular, his decision to pull out of the Joint Comprehensive Plan of Action nuclear agreement with Iran — Morales went further, linking Trump’s actions to a broader U.S. history of intervention in countries such as Iran.

“In 1953, the United States financed, planned and implemented a coup d’etat against a democratically elected government,” he said, referring to Iran. “After that, for many decades the United States supported an authoritarian government that allowed the profits from oil companies to line the pockets of transnational countries.

“This situation endured until the revolution of 1979,” Morales added. “And now that Iran has retaken control of its own resources, it is once again the victim of a U.S. siege.”

The Bolivian leader also said that the United States was responsible for the “most egregious acts of aggression committed during the 21st century,” including the military invasion of Iraq, the military intervention in Libya and the civil war in Syria. Morales also criticized Trump for threatening Venezuela and for its opposition to the International Criminal Court.

Trump didn’t really react to Morales and I’m going to speculate that the UN hacked his headset and replaced his translation with the audiobook recording of Art of the Deal. If you’re interested, here is Morales’s speech in full:


The governments of Argentina, Canada, Chile, Colombia, Paraguay, and Peru collectively referred Venezuela to the International Criminal Court on Wednesday for investigation over alleged human rights violations. The ICC says it’s already investigating possible abuses in Venezuela but this referral, the first of its kind in the court’s history, may hustle things along a little.

Meanwhile, Nicolás Maduro decided to attend the UN General Assembly after all, despite his stated fear that he might be killed either in the US or by a military junta upon his return to Venezuela. While at the UN, Maduro met with Iranian President Hassan Rouhani and Russian Foreign Minister Sergey Lavrov and delivered a speech heavily criticizing US pressure against Venezuela, but he did not meet with Donald Trump. This is not exactly a surprise, except inasmuch as both Maduro and Trump had said, and continue to say, that they’re willing to meet one other. Though Trump also keeps talking about arranging a coup in Caracas, so it’s kind of a mixed message.


Trump also told reporters on Wednesday that he rejected a request from Canadian Prime Minister Justin Trudeau for a face-to-face meeting to try to salvage NAFTA, a request the Canadian government insists it never made. The US and Canada appear to be nowhere near the vicinity of an agreement, which means the Trump administration is likely to ask Congress to vote on its bilateral accord with Mexico and effectively dissolve NAFTA altogether. Trump again mentioned the possibility of slapping tariffs on Canadian-made cars, which would be a major escalation in his back and forth with Trudeau.


While the “special payments vehicle” the European Union wants to create to protect Iranian commerce from US sanctions is likely to be too small and too weak to salvage the Iran nuclear deal, the Washington Post’s Rick Noack suggests it could be the first step in something I’ve talked about here and on my Patreon podcast from time to time (emphasis mine):

Given the untested nature of the E.U.’s current efforts, there are reasons to remain skeptical about whether those plans will be able to reassure international companies to stay in Iran. To some, the risk of being hit by U.S. sanctions may still outweigh the benefits of exploring a new market that was restricted until only recently.

On Wednesday, Germany’s industry and trade association DIHK said that German exports to Iran have decreased by 18 percent since Trump announced he would reimpose sanctions on the country. German carmaker Volkswagen announced last week that it was withdrawing from Iran, giving in to U.S. pressure.

Overall, German companies exported goods worth $3.4 billion to Iran last year. But Germany exported goods worth $117 billion to the United States in 2017, indicating that most companies were still far more dependent on trade with the United States than with exploring opportunities in Iran. In the short run, only small or medium-size European companies that rely more on their trade with Iran than with the United States are expected to participate in the E.U. plans.

In the long run, however, the E.U. effort could dismantle U.S. dominance of international payment systems — a status that has handed U.S. leaders a powerful tool of both economic and political influence in the past, for instance by stopping Chinese exports to North Korea and other rogue states.

Shifting away from US financial hegemony isn’t going to happen suddenly because it will be too painful a shock. But it could very well happen over “the long run,” especially if the Trump administration continues to antagonize Europe.

Finally, at LobeLog, Mitchell Plitnick hits on the same general theme:

Just a few sentences into Donald Trump’s speech to the United Nations General Assembly (UNGA) yesterday, the entire world was laughing at the President of the United States. Reactions to the rest of his speech might have vacillated between anger and ridicule, while his loyal base and administration servants sat with self-satisfied grins. But some of what he said should cause concern.

Whether it was his repeated emphasis on sovereignty over alliances—a common theme of authoritarian leaders—his railing about trade deficits whose effects on the US economy he clearly doesn’t understand, his attacks on international institutions and partnerships, or his general air of condescension and hubris, Trump reaffirmed his intention to move the United States deeper into a belligerent isolation from most of the world.


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