The Immiseration
of Europe by the United States
The Immiseration of Europe by the United States
Diana Johnstone
JULY 28, 2017
Do they know what they are doing? When the U.S. Congress adopts
draconian sanctions aimed mainly at disempowering President Trump and ruling
out any move to improve relations with Russia, do they realize that the measures
amount to a declaration of economic war against their dear European “friends”?
Whether they know or not, they obviously don’t care. U.S.
politicians view the rest of the world as America’s hinterland, to be
exploited, abused and ignored with impunity.
The Bill H.R. 3364 “Countering America’s Adversaries Through Sanctions
Act” was adopted on July 25 by all but three members of the House of
Representatives. An earlier version was adopted by all but two Senators.
Final passage at veto-overturning proportions is a certainty.
This congressional temper tantrum flails in all directions. The main
casualties are likely to be America’s dear beloved European allies, notably
Germany and France. Who also sometimes happen to be competitors, but such
crass considerations don’t matter in the sacred halls of the U.S. Congress,
totally devoted to upholding universal morality.
Economic “Soft Power” Hits Hard
Under U.S. sanctions, any EU nation doing business with Russia may find
itself in deep trouble. In particular, the latest bill targets companies
involved in financing Nord Stream 2, a pipeline designed to provide Germany
with much needed natural gas from Russia.
By the way, just to help out, American companies will gladly sell their
own fracked natural gas to their German friends, at much higher prices.
That is only one way in which the bill would subject European banks and
enterprises to crippling restrictions, lawsuits and gigantic fines.
While the U.S. preaches “free competition”, it constantly takes
measures to prevent free competition at the international level.
Following the July 2015 deal ensuring that Iran could not develop
nuclear weapons, international sanctions were lifted, but the United States
retained its own previous ones. Since then, any foreign bank or enterprise
contemplating trade with Iran is apt to receive a letter from a New York group
calling itself “United Against Nuclear Iran” which warns that “there remain
serious legal, political, financial and reputational risks associated with
doing business in Iran, particularly in sectors of the Iranian economy such as
oil and gas”. The risks cited include billions of dollars of (U.S.) fines,
surveillance by “a myriad of regulatory agencies”, personal danger, deficiency
of insurance coverage, cyber insecurity, loss of more lucrative business, harm
to corporate reputation and a drop in shareholder value.
The United States gets away with this gangster behavior because over
the years it has developed a vast, obscure legalistic maze, able to impose its
will on the “free world” economy thanks to the omnipresence of the dollar,
unrivaled intelligence gathering and just plain intimidation.
European leaders reacted indignantly to the latest sanctions. The
German foreign ministry said it was “unacceptable for the United States to use
possible sanctions as an instrument to serve the interest of U.S.
industry”. The French foreign ministry denounced the “extraterritoriality”
of the U.S. legislation as unlawful, and announced that “To protect ourselves
against the extraterritorial effects of US legislation, we will have to work on
adjusting our French and European laws”.
In fact, bitter resentment of arrogant U.S. imposition of its own laws
on others has been growing in France, and was the object of a serious
parliamentary report delivered to the French National Assembly foreign affairs
and finance committees last October 5, on the subject of “the extraterritoriality
of American legislation”.
Extraterritoriality
The chairman of the commission of enquiry, long-time Paris
representative Pierre Lellouche, summed up the situation as follows:
“The facts are very simple. We are confronted with an extremely
dense wall of American legislation whose precise intention is to use the law to
serve the purposes of the economic and political imperium with the idea of
gaining economic and strategic advantages. As always in the United States, that
imperium, that normative bulldozer operates in the name of the best intentions
in the world since the United States considers itself a ‘benevolent power’,
that is a country that can only do good.”
Always in the name of “the fight against corruption” or “the fight
against terrorism”, the United States righteously pursues anything legally
called a “U.S. person”, which under strange American law can refer to any
entity doing business in the land of the free, whether by having an American
subsidiary, or being listed on the New York stock exchange, or using a
U.S.-based server, or even by simply trading in dollars, which is something
that no large international enterprise can avoid.
In 2014, France’s leading bank, BNP-Paribas, agreed to pay a whopping
fine of nearly nine billion dollars, basically for having used dollar transfers
in deals with countries under U.S. sanctions. The transactions were
perfectly legal under French law. But because they dealt in dollars,
payments transited by way of the United States, where diligent computer experts
could find the needle in the haystack. European banks are faced with the
choice between prosecution, which entails all sorts of restrictions and
punishments before a verdict is reached, or else, counseled by expensive U.S.
corporate lawyers, and entering into the obscure “plea bargain” culture of the
U.S. judicial system, unfamiliar to Europeans. Just like the poor wretch
accused of robbing a convenience store, the lawyers urge the huge European
enterprises to plea guilty in order to escape much worse consequences.
Alstom, a major multinational corporation whose railroad section
produces France’s high speed trains, is a jewel of French industry. In
2014, under pressure from U.S. accusations of corruption (probably bribes to
officials in a few developing countries), Alstom sold off its electricity
branch to General Electric.
The underlying accusation is that such alleged “corruption” by foreign
firms causes U.S. firms to lose markets. That is possible, but there is
no practical reciprocity here. A whole range of U.S. intelligence
agencies, able to spy on everyone’s private communications, are engaged in
commercial espionage around the world. As an example, the Office of
Foreign Assets Control, devoted to this task, operates with 200 employees on an
annual budget of over $30 million. The comparable office in Paris employs five
people.
This was the situation as of last October. The latest round of
sanctions can only expose European banks and enterprises to even more severe
consequences, especially concerning investments in the vital Nord Stream
natural gas pipeline.
This bill is just the latest in a series of U.S. legislative measures
tending to break down national legal sovereignty and create a globalized
jurisdiction in which anyone can sue anyone else for anything, with ultimate
investigative capacity and enforcement power held by the United States.
Wrecking the European Economy
Over a dozen European Banks (British, German, French, Dutch, Swiss)
have run afoul of U.S. judicial moralizing, compared to only one U.S. bank: JP
Morgan Chase.
The U.S. targets the European core countries, while its overwhelming
influence in the northern rim – Poland, the Baltic States and Sweden – prevents
the European Union from taking any measures (necessarily unanimous) contrary to
U.S. interests.
By far the biggest catch in Uncle Sam’s financial fishing expedition is
Deutsche Bank. As Pierre Lellouche warned during the final hearing of the
extraterritorial hearings last October, U.S. pursuits against Deutsche Bank
risk bringing down the whole European banking system. Although it had
already paid hundreds of millions of dollars to the State of New York, Deutsche
Bank was faced with a “fine of 14 billion dollars whereas it is worth only five
and a half. … In other words, if this is carried out, we risk a domino effect,
a major financial crisis in Europe.”
In short, U.S. sanctions amount to a sword of Damocles threatening the
economies of the country’s main trading partners. This could be a Pyrrhic
victory, or more simply, the blow that kills the goose that lays the golden
eggs. But hurrah, America would be the winner in a field of ruins.
Former justice minister Elisabeth Guigou called the situation shocking,
and noted that France had told the U.S. Embassy that the situation is “insupportable”
and insisted that “we must be firm”.
Jacques Myard said that “American law is being used to gain markets and
eliminate competitors. We should not be naïve and wake up to what is
happening.”
This enquiry marked a step ahead in French awareness and resistance to
a new form of “taxation without representation” exercised by the United States
against its European satellites. They committee members all agreed that
something must be done.
That was last October. In June, France held parliamentary
elections. The commission chairman, Pierre Lellouche (Republican), the
rapporteur Karine Berger (Socialist), Elisabeth Guigou (a leading Socialist)
and Jacques Myard (Republican) all lost their seats to inexperienced newcomers
recruited into President Emmanuel Macron’s République en marche party.
The newcomers are having a hard time finding their way in parliamentary life
and have no political memory, for instance of the Rapport on
Extraterritoriality.
As for Macron, as minister of economics, in 2014 he went against
earlier government rulings by approving the GE purchase of Alstom. He
does not appear eager to do anything to anger the United States.
However, there are some things that are so blatantly unfair that they
cannot go on forever.
Diana Johnstone is co-author of From
MAD to Madness, by Paul H. Johnstone (Clarity Press).
She can be reached at diana.johnstone@wanadoo.fr
More articles by:DIANA JOHNSTONE
Diana Johnstone is the author
of Fools’
Crusade: Yugoslavia, NATO, and Western Delusions. Her new
book is Queen of Chaos:
the Misadventures of Hillary Clinton. She can be reached at diana.johnstone@wanadoo.fr
/https://www.niagarafallsreview.ca/content/dam/thestar/news/canada/2021/09/25/huawei-executive-meng-wanzhou-receives-warm-welcome-upon-return-to-china/_1_meng_wanzhou_2.jpg)
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