Europe’s Barbarians Inside the Gate

Nov 30, 2015 Nouriel Roubini

For Europe, solidarity begins at home. That means supporting aggregate demand and pro-growth reforms to ensure a more resilient recovery of jobs and incomes – and thereby beating back the populists and nationalists currently gaining ground throughout the continent.

BERLIN – I am on a two-week European tour at a time that could make one either very pessimistic or constructively optimistic about Europe’s prospects.

First the bad news: Paris is somber, if not depressed, after the appalling terrorist attacks earlier this month. France’s economic growth remains anemic, the unemployed and many Muslims are disaffected, and Marine Le Pen’s far-right National Front is likely to do well in the upcoming regional elections. In Brussels, which was semi-deserted and in lockdown, owing to the risk of terrorist attacks, the European Union institutions have yet to devise a unified strategy to manage the influx of migrants and refugees, much less address the instability and violence in the EU’s immediate neighborhood.

Outside the eurozone, in London, there is concern about negative financial and economic spillover effects from the monetary union. And the migration crisis and recent terrorist attacks mean that a referendum on continued EU membership – likely to be held next year – could lead the United Kingdom to withdraw. This would probably be followed by the breakup of the UK itself, as “Brexit” would lead the Scots to declare independence.

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Nouriel Roubini

Writing for PS since 2007
149 Commentaries

Nouriel Roubini, Professor of Economics at New York University's Stern School of Business and Chairman of Roubini Macro Associates, was Senior Economist for International Affairs in the White House’s Council of Economic Advisers during the Clinton Administration. He has worked for the International Monetary Fund, the US Federal Reserve, and the World Bank. His website is NourielRoubini.com, and he is the host of NourielToday.com.

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0 Comments on this paragraph, 31 in all 31 Comments on this article

Jean-Maurice Parnet Jan 19, 2016

Mr Roubini should visitEurope more often in order to be better acquainted with the Old Continent ! Indeed dubbing the European PATRIOTS "the populists and nationalist barbarians" shows right away that he has a long way to go before understanding anything outside of the American Eastern Seaboard ! That pains me considerably, as a graduate of Stern ('74) where he teaches ...
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Elizabeth Pula Jan 10, 2016

Isn't the real crisis the fact that elite media spokespeople are propagandizing an invasion of battalions of men, which is factually a military invasion crisis, as only a "migration crisis"? The planned attacks across Europe on New Year's Eve, are just that "planned attacks". The reports of victims have to be considered immediately, and not just interpreted over many months as just anecdotal ignored comments from the public. The PUBLIC is being attacked in the streets while protected leaders and media spokespeople are commenting on the sidelines, as if they are just an audience viewing a sports event. Unfortunately, until the reality of what the general public has been experiencing in the streets affects the private and gated pathways of the elite, the spectacle of violence not by just barbarians, but by calculated militarist invaders will escalate.
I have tried to word my comments with care. I am not an extremist, nor either to the left or right, However, I am hoping that my comments can help to reveal that democratic thinking is being attacked so severely, that democratic process is being destroyed by persistent attacks on a myriad of levels. Europe is not disintegrating from within, it is being attacked while failing to acknowledge the attacks. Europe will need to focus on its own long-term stability, and pay for it own survival first. The fighting in the Middle East is internal political rivalry among various historical tribes and family hierarchies. The overflow of violence into Europe is deliberate extension of calculated guerrilla warfare tactics by specific groups to extend their power and destroy European institutions, and stability to allow military success into the European continent. Of course, I could be totally wrong in my perceptions, However, I am not fooled by photos and news stories that only focus on the emotional emphasis of a relatively few females and children that are escaping turmoil fueled by their violent males. These males entering Europe are guerrilla forces only focused on attacking European citizens, and destroying European societies. Historical buildings, and every bit of beauty of European heritage will be destroyed, just like the sites of historical heritage within the Middle East. The eventual destruction throughout Europe will be worse than the destruction of Dresden. Again, I hope I am totally wrong.
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tony smith Dec 14, 2015

The article makes many good points but fails to properly address the root causes for the rising jihadism in the Middle-East. Yes, economic inequality and joblessness are a factor, but what about the Wests military-industrial complex which has pursued pointless wars without any endgame plans. What is the point in carpet bombing failed states without a plan for rebuilding them?

And why surrender the moral high ground so easily? One thing Iraq should have taught us is that the moral high-ground matters and is important. The general public seem to get this judging by opposition to these wars on the streets yet apparently our leaders dont understand or dont care?
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Chris Jones Dec 7, 2015

The Europeans and Democrats made a mistake by not help to maintain the facsimile of Camelot following the overthrow of Saddam. All sides, despite the egging on by outside forces, in Iraq were meeting at the round table and settling matters without might and doing what was right.
For all we know, al Baghdadi is dead or incapacitated. The remaining power structure of ISIS could be holding on in his name. Regardless, his time is short and the time to remove ISIS from the Levant is a given. In the mean time an international plan to establish an East Syria for resettling the refugees should be underway and I suppose it will be a majority Sunni entity. Western Iraq can be resettled by the Yasidis, Christians, Kurds, and Sunnis loyal to the Iraqi state.
I read on Wikipedia that many followers of the Koran believing in the Day of Reckoning think Jesus is coming in 2017. I don't think he will be very happy with the likes of ISIS or al Qaeda due to their deeds of attacking the innocent and throwing mercy out the window. As I understand it from the Wikipedia section on the Islamic end times, the Koran mentions that Jesus is required, but there is no mention of al Baghdadi. The Mahdi or Caliph is mentioned in the disputed Hadith, but that is a schismatic interpretation with the Shia believing only in bloodline succession and the Sunnis adding much more. As I understand it, the Wahhabi branch teachings of the Sunnis are responsible for the the several terrorist Islamic extremist activity the last several decades. The political leaders may want to also address this in order to restore the Levant area to a land of peaceful coexistence.
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Ellie Kesselman Dec 7, 2015

Every column that Nouriel writes here is about the evils of populism. This one concludes with, "And that means beating back the populists..." yet fails to make any mention of how pro-growth reforms are supposed to be implemented. Since when did populism become so evil and barbaric?
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Ray Halpin Dec 6, 2015

How do you 'support' aggregate demand and pro-growth reforms?
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Jay Kay Dec 6, 2015

Merkel and all the others that foisted the oxymoronic logical absurdity of Multiculturalism on the people of Europe are the present day incarnations of Ephialtes. History will despise them.

These agents of the Anti-Enlightenment have for the last two decades closed their eyes and ears the to the chaos and death brought about in Europe and the West as a direct result of the their infatuation with various failed hypotheses, predominantly Multiculturalism and Political Correctness.

These agents of the Anti-Enlightenment refuse to acknowledge the results of experiment, thousands of experiments, millions of experiments both in Europe and the wider West that unequivocally demonstrated that Multiculturalism and Political Correctness were nothing more than just another inane religion.
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Victor Douglas Dec 6, 2015

It is not true that climate change is causing, on balance, a flood of migrants. Climate change made Syria drier, but it has made the Sahel in Africa wetter. Without it, there would be more migrants from Mali. Niger, Chad, Sudan, and northern Nigeria, the latter of which is more populous than Syria by itself.

The problem is the lack of birth control in Africa and parts of the middle east. Yemenites have 4 children per woman. Nigerian city-dwellers have 5 children. Rural northern Nigerians have 7. Rural Syrian Sunni Moslems have 5.

The world cannot absorb this sort of growth for more than another generation.

The international effort has to be to cut this birth rate, and not allow those from such cultures to migrate to Europe.

Israel has no problems with migration to it. Neither does China. It is not difficult to control migration, if you actually want to, and your executive, your parliament, and your courts are all committed to it. Europe and the US must deal with absurd grounds for refugee status, like domestic violence, whose actual solution involves moving to another town, not another country.
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de Lafayette Dec 6, 2015

{But Germany’s thrifty savers – households, banks, and insurance companies – are furious about ECB policies that tax them (and others in the eurozone core) to subsidize the eurozone periphery’s alleged reckless spenders and debtors.}

True enough, but the EU (like any such economic union) is Musketeer-like. That is, "All for one and one for all."

It seems, from the above comment, that Germans don't understand that the saving German households put into German banks comes to a great extent from German goods sold in the EU. Or that its insurance companies are also active across the EU and not just in Germany.

This togetherness should spawn a common concern for the good fortune of the EU as a whole, but Germany seems not terribly persuaded by such an ideal.

And, frankly, given the Germans I know personally, because I work with them, the response is surprising. The ones I know do not share at all the antimony that the Bundesbank has for other members of the EU.

Probably because they happen to work in one of those other countries, and therefore have a broader view of the EU than those in the Bundesbank bunker ... ?
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de Lafayette Dec 6, 2015

{Outside the eurozone, in London, there is concern about negative financial and economic spillover effects from the monetary union.}

Nourini overlooks, in making this statement, a very important characteristic of Europe. Which is very difficult to perceive if someone is accustomed to American-style Democracy.

In America, were the national budget set by the contributions of the states, then it would probably show exactly the same lethargy as in Europe. Not all the states would agree (perhaps) with stimulus-spending out of the economic miasma.

America's lethargy at present is due to hard-line Replicants who "own" (because they literally bought it) the HofR. They have stymied any and all stimulus-spending since 2010 thus incarcerating the US in its slow crawl-out naturally from the Great Depression.

What is the difference, pray tell, with Europe? Both entities, the US and the EU, have been harried by a group who do not want any stimulus-spending. One must suppose that economic recovery is "organic"?

Even when the "organ" is a market-economy, which in both instances is the same.

Democracy is the best sort of governance that has come mankind's way in more than 3000 years. It certainly is not perfect.

Except that it is "perfectly human". Which is, in fact, the problem that prevents a fuller and quicker climb-out from the Great Recession that is now six-years old ...
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Steve Hurst Dec 3, 2015

Figures suggest 50% of the 1 million plus migrants this year are uneducated and cannot speak the required new lingo. Austarlian figures and Swedish figures on refugee/migrant long term unemployment are dismal 90+% and 80+% respectively remain unemployed. Most of these migrants in reality will make little attempt to integrate but try to establish little homelands and maintain niceties like horour killings. Africa - a longterm future migrant source has failed repeatedly and in many cases lapsed into aid dependency. The West may be able to assist but cannot support longterm developing nations - its unsustainable. There cannot be more intergration and risk sharing when individual states unilaterally decide what suits them, whether it is Germany declaring the suspension of the Dublin agreement or Greece failing in border control. Time and time again non european states fail to deal with opportunity - Afghanistan and Iraq are examples continuing to shout for support and intevention. As for Syria, there is de facto no government to be supported since virtually everyone other than Russia wants Assad gone, so just who is support being given to - a loose alliance of people fighting one another, that'll work well wont it. Very simply there is not enough capacity in Europe to accept all that want to come here. That means there will be unhappy migrants whatever, there will be fences on borders that cannot otherwise be controlled - get used to it. Cyclical recover in Europe, tell that to France with its dismal figures? Surely we are due another cyclical downturn shortly are we not as there is an underlying cycle. The strength of Germany looks great until you consider it has in reality been subsidised by imbalances in the eurozone. Imbalances that took a decade to manifest, have not been addressed and will return continental drift like. Those wanting to throw democracy on the fire in Europe are the ones who gain from the current imbalances. The idea that behaviour can withstand the ballot box long term is ingenious to say the least
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jagjeet sinha Dec 3, 2015

The Mediterranean Meltdown threatens revival of French alliance with Russia to confront the mayhem to its southern flanks.
The Europe that this leads towards represents a dramatic departure for The Anglosphere - secured successfully since 1588.
The Sterling-Rupee fulcrum that permitted its creation was replaced by the Dollar-Sterling duo - both then by the Euro-Dollar.
The Putin-Euro and its earlier failed version the Petro-Euro, both representatives of a World Order very different.
But realities of World Economics require changes - incumbency is not easily challenged, there is no morally superior order.
To expect America and Russia to revel inside The Eurosphere, is to expect Rome and Greece living happily in the hereafter.
And now with The Renminbi inside The IMF Currency basket, there are Seven Currencies in play to secure their Spheres.
The Solar system has Nine - plus The Sun.
We must remember that The Sun is not a planet.
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Francesco D'Allessandro Dec 3, 2015

So anyone who doesn't agree with certain policies ranging from the massive influx of refugees or a probable "Brexit" is a barbarian. I never thought that democracy was a total uniformity of thought. All voices are important in a debate Mr. Roubini including yours. To label any dissent such as in the migration crisis issue (allowing 20 million asylum seekers to enter the EU as you calmly predict) as Neanderthal thinking is to condemn to the dustbin of history the values that we all uphold for our liberal world order. Discourses on the various maladies afflicting the Westphalian system such as the forum here at Project Syndicate is what is required to find solutions to resolve the countless crisis overwhelming the West. It is essential for our elected officials and their spokespersons to take into consideration the vox populi of their constituencies and not just of their own views.
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Peter Schneider Dec 1, 2015

My plea is a complete withdrawal of confidence from those who have been betraying and deceiving us for years now. They trample on our common values, they have virtually terminated the rule of law and break the law day in day out (TFEU 123/125), they suppress democratically legitimated parliaments and let instead unelected foreign bureaucrats take the crucial decisions on legislation and on the budget (because they know very well that their plans lack popular support), they delegate border protection to dubious potentates from foreign states, they abuse our language (e.g. speak of "solidarity" when they refer to their shameful game), they think of themselves as "enlightened" and call their critics "barbarians" (as here) or "pack" (as the German vice chancellor) or "dark" (as the German president), they destabilize their societies and their countries, they spread division, they supress freedom of opinion and any public discussion. No, they are not to be trusted any longer. Europe is so weak because of them.
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Zsolt Hermann Dec 1, 2015

The writer suggests as main solution "...supporting aggregate demand and pro-growth reforms.."
In my translation it means continuing brainwashing people through sophisticated marketing to keep wanting and purchasing products, pleasures they do not need and have no means for in order to keep driving an excessive, artificial demand based economy and lifestyle to provide ever increasing profit for a small minority.
Is it not possible that this "solution", unnatural "Ponzi-scheme" is actually one of the reasons we are in the global crisis we cannot solve?

And regarding the "cooperation" suggested in order to solve problems how can we hope for positive results when we still make calculations based on selfish gains, ruthless competition, undermining even our closest allies and still want to succeed at the expense of others?
If we truly want to cooperate we would need to learn how to create mutually complementing collaboration based on making calculations for the whole collective ahead of individual, selfish ones.

We have to start viewing our world as a single interconnected whole where cause and effect processes affect each and every element.
Without such global, systemic thinking, action neither the economic, financial or geopolitical problems can be solved, managed.
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Stamatis Kavvadias Nov 30, 2015

Bad news for "positively" thinking actors, like Roubini:

No Marshal plan can save Europe, unless it stops participating in wars outside its borders.

But, of course, European political leadership do not want a free united Europe, but one under the draconian rule of terrorist and emergency laws.

The ideas that blame religion are part of a beginning of the end of free European countries. Wake up and call back your armies (call back your dogs), before criticising Muslims!

Open up the Syrian embassies in Europe. Where is the right in alienating past emigrants from their home and European participation in increasing the numbers of refuges with bombing and armies on the ground?
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John B. Licata Nov 30, 2015

ZIRP is Europe's primary problem, exacerbated by Mario Draghi.
Citizens of Europe are not receiving adequate interest on their savings, very much like the US. No income, no spending. The insane policy of driving interest rates to, or below zero, supports asset prices at the expense of the middle class.
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Luke Lea Nov 30, 2015

Europe can build a wall too.
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Robbie Jena Nov 30, 2015

Two areas to think: 1. USA run in to the same economic issues after 9/11 that Europe will go through in to the future. 2. "France’s economic growth remains anemic" - It is similar in Germany and UK over the long run. These two issues will cause serious trouble to Europe in five years and more. Already Germany and UK know about it, but what they will do, I can not tell.
- Robbie Jena Nov 30, 2015
  
  Just a chart that explains my post:
  https://www.facebook.com/photo.php?fbid=909070175807658&set=pb.100001140530243.-2207520000.1448893159.&type=3&theater
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David Olsen Nov 30, 2015

A reasonable enough article, but why sabotage it in the last sentence by adding 'pro-growth reforms'?
'Reforms' is generally understood to be code for wage cuts. How does that support aggregate demand?

How are fiscal rules increasingly flexible? Is it because a blind eye is being turned to the 3% deficit rule for the time being? If this is the case why did Italy threaten to resubmit it's budget in exactly the same form because it's proposed increased spending was rejected.
Perhaps this increased fiscal flexibility is more wishful thinking than reality.
- Mr Econotarian Dec 1, 2015
  
  How about labor market reforms to drive down the epidemic of joblessness in Europe (except Germany, which partially solved the problem with the Hartz reforms)?
  
  If Syria, Egypt, and Iraq were not so economically unfree as well, there would be fewer problems there.
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M M Nov 30, 2015

A message to the writer: On which planet are you? You have the "beloved" current political / financial leadership (Ban Ki-Moon, Prince Charles, Merkel & Co, etc.) now blaming everything, from IS to the increase in the number of drug addicts, on "Climate Change". One should not be surprised, if one day they would not even blame "God" for their irrational thinking and irresponsible behaviour. Total insanity.
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george sos Nov 30, 2015

Let me share a different perspective(the one most Greeks have).
EU ,and especially Germany ,thought ,"what a nice way to have a big pond full of desperate people in side Sengen ,so we can pick and choose who we need,and let the rest rot in the hands of Greece....
The plan was all along to create this substate (Greece) to use it as the container.And they succeeded ,since they hold all power,even power to overrule elected governments.(call me banker).
Nouriel is right to say that the only solution is a big marshall plan.Only it is too late for such a plan.We should focus now on sharing ,inside europe,with the new arrivals and the old remains.We should share the (stolen mostly) world before we lose it completely.And i dont mean just europeans.As he says,the oil rich arabic countries also have to participate.But for this toi happen we have to also start talking about the end of religions.The end of this instrument of control that for so long several powers wanted to use in order to rule over people,to keep them in darkness so they can steal the resources easier...Africa had a good taste of that from the oil industry .So did Iraq.and so many others.Only way to stop this madness and the final chapter of humanity is to overthrow the powers,stop consuming like there s no tommorrow,and restore Justice,Equallity for all(women included) ,restore human rigghts as the principal ideal ,and start restoring a society capitalism managed to bring to its knees in less than 100 years.We should put our heads together to create a new economic system without gaps,that can be exploited ,and punish all those who try to do so .Enough is enough with the "free markets".(sounds good eh?.free ,as free as a prisoner(for consumers).)
But i can hear you arguing,are we going to become communists?
No.We need ,a new simple,genuinenly honest and just solution,not short term fixes.
Are we up for it?I think no.Greed ,has taken over our world.
The reasons can be traced back to economic studies and the way academia turned into a magician's birthday,with all the training magicians trying their spells on us,trying to justify the unjustifiable....no,i don't hope.and when humans lose hope,its never a good thing for noone.
- Michael Public Nov 30, 2015
  
  For over a hundred years people have worked to formulate, create and popularize better systems, but the public are simply not ready for them. The current system we live in is one where corporations have hijacked the state and press in the name of 'windfall profits' aka exploitation. Greece is just one example of the effects of this. A better way will never come from the top down, because they are too invested in the current model. Start reading and researching and you will find the things you are saying are no different to what many other thinkers have said over the last hundred years, and in particular the last 40 years of so called neo-liberalism.
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Bob Logic Nov 30, 2015

The "enlightened" leaders in Berlin have to cope with two crisis that are the result serious flawed agreements and crippled implementation: 1) the maastricht treaty and the admission of Italy and Greece and 2) Schengen aagrement which resulted in open borders, especially in Greece. With the enlargement of the EU decision has become extremely problematic and the growing disappointment in the populations about the EU since 2000 has not been effectively answered. The EU is also unable to cope with the growing number of regimes inside the union that violates basic rules and values, like Poland and Hungary.
The EU first has to learn from the mistakes that it has made so far. Maybe that after a fundamental rethinking of the EU more integration can be a solution. Now it will probably deepen the already existing problems.
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Michael Public Nov 30, 2015

In response to the last sentence: jobs and growth are not everything. There is more at stake here. The EU is first of all a region with a single currency and many sovereign governments - it is at its core an unworkable arrangement in the world of realpolitik we live in. Additionally, there is the matter of culture, migrants may bring cheap labor which is good for growth, but they also bring a medieval type culture with them that has been at War with the west since the 7th century AD. Europe must decide, do they wish to create a 'federal government' like the US (or China for that matter), or do they wish to break up. They stand in no man's land at the moment, which is no wonder they seem completely unable to tackle anything - from Greece to migrants to the financial sector.
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Diego Orlandi Nov 30, 2015

Choose one between the two following sentences:

1. UK and France supplided airforce support to oust Gheddafi and leave Lybia in a crisis since 2011, and Turkey shot a russian warplane in Syria in support of Isis.

2. Nato ousted supplied airforce support to oust Gheddafi and leave Lybia in a crisis since 2011, and shot a Russian warplane in Syria in support of Isis.

If you are not sure about either sentence, or you do not like either sentence, you are thinking European!
- george sos Nov 30, 2015
  
  spot on Diego!!:)!
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