Trump And The World

Donald Trump And Jerusalem: It's Complicated

Is the American in good faith? Why now? What's next? Questions pile up in the wake of a decision that reverses 70 years of U.S. diplomacy in the Middle East.

Burning American and Israeli flags in Gaza on Dec. 6
Daniel Gordis

JERUSALEM — Calling it a "recognition of reality" and "the right thing to do," President Donald Trump announced Wednesday that the U.S. was recognizing Jerusalem as Israel's capital, and that the American Embassy will be moved from Tel Aviv to the contested city.

The announcement leaves many questions, two of which are primary. The first is whether violence will ensue. The Palestinians and Turks are making threats, and Israel's security establishment is said to be on alert. But many Israelis are dismissing the dangers of what they call "Trumpocalypse." Unlike hypothetical steps, such as assigning the Palestinians a smaller state than they demand or ending U.S. support for a two-state solution, recognizing Jerusalem as Israel's capital changes nothing on the ground. Many Israelis and even Palestinians thus doubt that, grandstanding aside, the Palestinians would risk much in response to a statement merely acknowledges what the world has long known to be true.

Trump needs to buy the allegiance of both sides.

The other major question is, "Why now?" Theories abound, of course, but the most obvious explanation is that Trump is seeking both a diversion from his growing problems at home and a bone to throw to his evangelical Christian and Orthodox Jewish base before his support there erodes. Trump's core supporters will likely stick by him through thick and thin, but there have to be some religious voters who find the president's open endorsement of Alabama Senate candidate Roy Moore — widely believed to have forced underage women into sexual encounters — distasteful to say the least. The Russia investigation looms, as do increasing questions about whether Trump, his family or his innermost circle may be legally vulnerable. It hasn't been a good period for the president; if Trump was looking for a diversion, he seems to have landed on an effective one.

There is one much less cynical, although unlikely, possibility that deserves mention. Trump has long said he will forge a deal between Israelis and Palestinians, and rumors on the street are that the "key principles' of his team's agreement are emerging. Accounts vary. The Palestinians would get a state, though the 1967 lines would not be its borders. According to some, the territory they get would not be contiguous. That would amount to substantially less than the Palestinians demand and far more than Israel's right flank intends to give them. If the administration is serious about such a deal, Trump needs to buy the allegiance of both sides.

"Death To America" — Dec. 7 front page of Lebanon-based daily Al Akhbar

The capital announcement is a prize that Prime Minister Benjamin Netanyahu (weakened by corruption scandals and in no position to push back) can use to assuage his right flank. At the same time, Trump may have told Palestinian Authority President Mahmoud Abbas (who is 82 and running out of time) that no one will object if the Palestinians protest or burn flags, but serious violence will not be tolerated. If Abbas wants his state, he may have heard, he had better make sure to keep the response to Trump's announcement muted.

Netanyahu, in return, may have been warned that in return for his prize, he will be expected to deliver support for the plan Trump's team plans to proffer. If anyone can deliver the Israeli right, it is Netanyahu, likely the most skilled political manipulator the country has had as prime minister. With his political life possibly nearing its end and with little to show for his years in office, Netanyahu would like a deal like this to ensure his place in history.

Such capitulation serves no one.

How likely is this scenario? It's hard to say. A careful plan in which the Trump moves slowly and stays on script would hardly be characteristic of his modus operandi so far. But it's not entirely out of the question.

Trump, not surprisingly, is taking heat from all corners, including Palestinians, Iranian President Hassan Rouhani, UK Prime Minister Theresa May, Christian leaders in Israel and even the liberal American Jewish community. Yet even if he was motivated primarily by his own selfish needs, Trump is right — he did the right thing.

For decades, the Western world has allowed fear of Palestinian terrorism (or Palestinians backing out of negotiations) to silence claims that everyone knows to be true. Such capitulation serves no one. It doesn't serve the West, for it renders even the U.S. impotent in the face of Palestinian threat. It doesn't help Israel, which wants the world to acknowledge that its capital being near the seat of King David's kingdom and the location of the two Temples symbolizes with utter clarity that the Jews have returned home. And it doesn't serve the Palestinians, who through the use of threat, have immobilized the West and put off the serious deliberations they will have to undertake if they are ever to get the state they want.

Whether the president has the focus, skill and interest in making this move the beginning of a positive and far-reaching process, though, remains to be seen.

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Economy

European Debt? The First Question For Merkel's Successor

Across southern Europe, all eyes are on the German elections, as they hope a change of government might bring about reforms to the EU Stability Pact.

Angela Merkel at a campaign event of CDU party, Stralsund, Sep 2021

Tobias Kaiser, Virginia Kirst, Martina Meister


-Analysis-

BERLIN — Finance Minister Olaf Scholz (SPD) is the front-runner, according to recent polls, to become Germany's next chancellor. Little wonder then that he's attracting attention not just within the country, but from neighbors across Europe who are watching and listening to his every word.

That was certainly the case this past weekend in Brdo, Slovenia, where the minister met with his European counterparts. And of particular interest for those in attendance is where Scholz stands on the issue of debt-rule reform for the eurozone, a subject that is expected to be hotly debated among EU members in the coming months.

France, which holds its own elections early next year, has already made its position clear. "When it comes to the Stability and Growth Pact, we need new rules," said Bruno Le Maire, France's minister of the economy and finance, at the meeting in Slovenia. "We need simpler rules that take the economic reality into account. That is what France will be arguing for in the coming weeks."

The economic reality for eurozone countries is an average national debt of 100% of GDP. Only Luxemburg is currently meeting the two central requirements of the Maastricht Treaty: That national debt must be less than 60% of GDP and the deficit should be no more than 3%. For the moment, these rules have been set aside due to the coronavirus crisis, but next year national leaders must decide how to go forward and whether the rules should be reinstated in 2023.

Europe's north-south divide lives on

The debate looks set to be intense. Fiscally conservative countries, above all Austria and the Netherlands, are against relaxing the rules as they recently made very clear in a joint position paper on the subject. In contrast, southern European countries that are dealing with high levels of national debt believe that now is the moment to relax the rules.

Those governments are calling for countries to be given more freedom over their levels of national debt so that the economy, which is recovering remarkably quickly thanks to coronavirus spending and the European Central Bank's relaxation of its fiscal policy, can continue to grow.

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive.

The rules must be "adapted to fit the new reality," said Spanish Finance Minister Nadia Calviño in Brdo. She says the eurozone needs "new rules that work." Her Belgian counterpart agreed. The national debts in both countries currently stand at over 100% of GDP. The same is true of France, Italy, Portugal, Greece and Cyprus.

Officials there will be keeping a close eye on the German elections — and the subsequent coalition negotiations. Along with France, Germany still sets the tone in the EU, and Berlin's stance on the brewing conflict will depend largely on what the coalition government looks like.

A key question is which party Germany's next finance minister comes from. In their election campaign, the Greens have called for the debt rules to be revised so that in the future they support rather than hinder public investment. The FDP, however, wants to reinstate the Maastricht Treaty rules exactly as they were and ensure they are more strictly enforced than before.

This demand is unlikely to gain traction at the EU level because too many countries would still be breaking the rules for years to come. There is already a consensus that they should be reformed; what is still at stake is how far these reforms should go.

Mario Draghi on stage in Bologna

Prime Minister Mario Draghi at an event in Bologna, Italy — Photo: Brancolini/ROPI/ZUMA

Time for Draghi to step up?

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive. That having been said, starting in January, France will take over the presidency of the EU Council for a period that will coincide with its presidential election campaign. And it's likely that Macron's main rival, right-wing populist Marine Le Pen, will put the reforms front and center, especially since she has long argued against Germany and in favor of more freedom.

Rome is putting its faith in the negotiating skills of Prime Minister Mario Draghi, a former head of the European Central Bank. Draghi is a respected EU finance expert at the debating table and can be of great service to Italy precisely at a moment when Merkel's departure may see Germany represented by a politician with less experience at these kinds of drawn-out summits, where discussions go on long into the night.

The Stability and Growth pact may survive unscathed.

Regardless of how heated the debates turn out to be, the Stability and Growth Pact may well survive the conflict unscathed, as its symbolic value may make revising the agreement itself practically impossible. Instead, the aim will be to rewrite the rules that govern how the Pact should be interpreted: regulations, in other words, about how the deficit and national debt should be calculated.

One possible change would be to allow future borrowing for environmental investments to be discounted. France is not alone in calling for that. European Commissioner for Economy Paolo Gentiloni has also added his voice.

The European Commission is assuming that the debate may drag on for some time. The rules — set aside during the pandemic — are supposed to come into force again at the start of 2023.

The Commission is already preparing for the possibility that they could be reactivated without any reforms. They are investigating how the flexibility that has already been built into the debt laws could be used to ensure that a large swathe of eurozone countries don't automatically find themselves contravening them, representatives explained.

The Commission will present its recommendations for reforms, which will serve as a basis for the countries' negotiations, in December. By that point, the results of the German elections will be known, as well as possibly the coalition negotiations. And we might have a clearer idea of how intense the fight over Europe's debt rules could become — and whether the hopes of the southern countries could become reality.

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