Accountability, Congress style

KAMAL NATH and Sonia Gandhi lose an election in Gujarat and Vilasrao Deshmukh loses his job in Maharashtra. This is accountability, Congress style. It involves a new definition of ‘scapegoat’. When Sonia Gandhi wants to escape someone else has to become the goat.

Vilasrao Deshmukh did not lose his job because he was hopeless. Competence, either administrative or political, was never the reason. If he had to go because he was incompetent, then he should have been sacked at least a year ago. Anyone with a political ear, and some feel of the street, has known for a long while that Deshmukh, wooden all the time, and woolly about everything except his personal interests, was one of the worst chief ministers ever.

If there were any system of audit in the All India Congress Committee headquarters, Deshmukh would have lost his job long before Keshubhai Patel lost his in neighbouring Gujarat, opening the way for Narendra Modi. Governance for Deshmukh amounted to nothing more than cuts (for himself and his party) and handouts.

The fiscal mismanagement has been appalling. I was talking to a veteran former editor of a leading Marathi newspaper, who went to settle down in America a little more than six years ago. I asked him what he thought Maharashtra’s debt had become. He paused, considered, and offered what he thought was a huge figure. Two thousand crores, he volunteered. I replied that it had gone up to Rs 80,000 crores and was expected to cross Rs 100,000 crores by 2004. He started laughing, only because he did not want to weep.

One cannot blame him for being shocked. When Sharad Pawar was defeated by the Shiv Sena-BJP combination, he left behind a state with a Rs 250-crore surplus. The Sena-BJP government turned that into a massive deficit of Rs 49,000 crores by the time it was voted out. The Congress would have doubled that and more by the time it is voted out next year. And no one has yet got the message. You do not win elections by throwing money at vested interests.

“Gone!” muttered my editor-friend. He was talking about both the state and the government. The people of Maharashtra have been making this clear for some time now. Anyone who has seen Udhav Thackeray draw cheers from plus-50,000 crowds in a small town knows that he has also seen the face of a future chief minister. Deshmukh added combustible folly to his incompetence when he promoted his son in a popular Hindi film that never became popular because his son turned out, at least in this movie, to be as big a flop as his father.

The voter interpreted his chief minister’s involvement in the film industry very simply: the father was spending corruption money to help his son. It is the kind of interpretation that is made easily when you have lost credibility.

Sonia Gandhi should have realized what was going on in a vital state like Maharashtra much earlier, and sought to control matters when there was still time to make a difference. But the decisions of the Congress high command are not made on the basis of honest evidence and analysis. They are measured by loyalty and the regularity with which a chief minister sends funds to Delhi. Deshmukh kept Delhi happy, and Delhi kept him happy. It was cosy relationship. No wonder Deshmukh looked visibly shocked when he learnt that he had to pay the price for Gujarat.

Sonia Gandhi has moved to protect herself. Before Gujarat, she had begun to believe that it was only a matter of time before she became Prime Minister of India. Her courtiers had been feeding her with the traditional fare of cooked-up lies. Either that, or they said what the boss wanted to hear. Sonia Gandhi could not distance herself from the complete abdication of ideology and common sense in the Gujarat campaign; she authorised the naive and even childish notion that a “soft Hindutva” combined with the marginalization of Muslims would take the Congress to victory against Narendra Modi.

After Gujarat, and the obligatory ten days of silence, she had to change the subject. She knew that if the Congress was routed in Maharashtra and Rajasthan she would have to share the blame since she had made Deshmukh and Ashok Gehlot chief ministers. So off with their heads, lest hers be in question later. Digvijay Singh is a different story. He became chief minister long before she appeared on the scene. This fact used to irritate her. But she is now too weak to move against him. If Kamal Nath had by some miracle won in Gujarat he would have made bid to replace Digvijay Singh.

So twinkling-blue-eyes Sushil Shinde becomes chief minister of Maharashtra because of the usual reason: bloody great luck. His first four ‘thank you’ letters should, therefore, in descending order of importance, be to God, Narendra Modi, Sharad Pawar and Sonia Gandhi.

The preeminence of God on the list is inarguable. God, after all, is the final arbiter of that fickle slave, fortune. Napoleon, famously, preferred a lucky general to a good one. God also gave him the right caste. This is a good time in Congress politics to be a Dalit since no Dalit is voting for the party anymore. Sushil Shinde provides the first reason for the Dalit to return, although neither departure nor return is ever done in a hurry in politics.

Shinde has waited a long while for this job. He has a strong sense of his own destiny, encouraged surely by the astrologer who has told him that he will be at the top of the heap some day. You cannot hold this against him. He started life as a constable. If he can travel from a constable’s beat to a chief minister’s palace, why should he not believe that he can go further, and perhaps to the top in Delhi as well.

Shinde’s good fortune is all the better for the fact that he has become chief minister in the last phase of this Assembly’s five-year life. He cannot now be removed from the job until the elections, when the electorate will determine his future. Having helped him, Sonia Gandhi is now helpless. He can swim without her.

The reasons for a ‘thank you’ note to Narendra Modi are obvious: no Modi victory in Gujarat, no turmoil in Delhi, no change in Maharashtra. The reasons for a thank you note to Sharad Pawar are more subtle. Those familiar with the labyrinth of private equations know that Sushil Shinde and Sonia Gandhi’s bete noire Sharad Pawar get along famously, even if they do not advertise this equation out of political compulsions.

Sharad Pawar intervened effectively to ensure that Shinde replaced Deshmukh rather than anyone else. Shivraj Patil, deputy leader of the Opposition in the Lok Sabha, was a contender, backed hugely by those Congress Members of Parliament who wanted him out of their hair. (Such are the paradoxical rivulets that create rivers.) Pawar delivered a simple message. If his party and the Congress did not work together, they would both be sunk, with the Congress in deeper trouble than him.

However, in all fairness, Shinde should send a ‘thank you’ letter to Sonia Gandhi as well. She could have got cussed and preferred Shivraj Patil. In fact, a stronger Sonia Gandhi would have installed Patil. But Gujarat changed all that.

The key question is: having made it to the top, can Sushil Shinde deliver? That is easier promised than delivered. The evidence is not encouraging. Every party has tried to change an ebbing chief minister in order to redirect the tide, but the original current has proved too powerful. Check with Sheila Dikshit, Sushma Swaraj and Sahib Singh Verma.

Nearly five years ago, an anxious BJP tried to change the mood of the Delhi electorate by replacing Verma with Sushma Swaraj. Sheila Dikshit still laughed her way to the vote bank. Sushil Shinde has about a year in real time to undo the damage of three and a half years of apathy, indifference and sheer absence of political understanding.

The writer is chief editor, The Asian Age, New Delhi.

Lavish tax cut plan

PRESIDENT Bush boasts that he is creating prosperity. But if the White House keeps cutting taxes, while raising its estimates of the budget deficit — as it did Wednesday, to $200 billion — Americans are going to feel as duped as the women on “Joe Millionaire” who are about to discover that the hunk they’ve been chasing is really a working stiff.

At the very moment that the White House is peddling a lavish tax cut package, Senate Republicans are pushing to cut spending on social programmes and backing away from their commitment to protect their constituents from terrorists. The two initiatives would knock social services out from under people and leave the nation vulnerable. They would also further impoverish the states.

Congress left a fiscal mess last year when it failed to pass important spending bills. The GOP is intent on showing that it can stick close to the $385-billion spending package demanded by Bush. But the party’s shortsightedness (and short memory) is reflected in Republican senators’ rejection last week of Sen. Robert C. Byrd’s, D- W. Va., amendment for pumping an extra $5 billion into the budget for protecting ports, nuclear plants and other facilities. That may be more than is needed, but fending off terrorists is important and the states can’t do the job alone.—Los Angeles Times

Finance sector’s key role

THAT the 1960s was a golden age for Pakistan’s economic development is something few serious historians would dispute today. Under the direction of President Mohammad Ayub Khan, Pakistan’s first military leader, the country was able to sustain a rate of GDP growth of 6.5 per cent a year in the eleven-year period between 1958 and 1969. Income per head of the population increased by an impressive 3.6 per cent per annum. The size of the Pakistani economy nearly doubled — more accurately, it increased by 99.9 per cent — during the Ayub era. Average income for Pakistan’s citizens increased by 48 per cent between 1958 and 1969.

In the 1960s, Pakistan was one of the most rapidly growing economies in the developing world. There was an expectation then that it would be one of the few developing countries that would “take-off” — in the words of W.W. Rostow who had coined the term in the context of his “stages of growth” theory — from the stage of economic backwardness to that of sustained growth. In fact, the Pakistani economic miracle preceded that of the East Asian miracle which was to change the economic, social and political fortunes of half a dozen countries in that part of the world. Had Pakistan not deviated from the path it was taking in the 1960s, it would have joined the ranks of the ‘Asian tiger’ economies a long time ago.

These reflections on Pakistan’s economic performance in the 1960s are not offered to invoke nostalgia. They are presented in order to underscore an important point: the economy did well in that period for the reason that it was provided with a strong institutional underpinning. The managers of the economy at that time who worked out of the Planning Commission and the ministry of finance had an instinctive understanding of the importance of institutions for supporting growth and development. They included institutional strengthening in their growth strategy long before institutional economics gained widespread respect.

What were the sources of economic growth during the Ayub period? This question was addressed by a number of academics and practitioners who wrote copiously about that period. Most credit one sector — agriculture — for the country’s remarkable performance during the period. Some also focus on government policies that put development high up on the administration’s agenda as the driver of growth. However, none of the analysts with whose work I have some familiarity identify Ayub Khan’s support for the development of financial sector as an important element in promoting growth.

Pervez Hasan’s recent book on Pakistan’s economy is a highly competent piece of analysis and a reliable history of the country’s development experience. Nonetheless, in summarizing the reasons for the impressive economic performance during the 1960s, Hasan makes no mention of the role of the financial sector.

“Few periods in Pakistan’s history stand out so clearly as 1960—65 for quickening the tempo of growth,” writes Hasan. “Ayub’s strong commitment to development, his support to public institutions for planning and development, his unhesitating use of foreign economic assistance, his unwillingness to reduce reliance on direct economic controls and thus improve the investment climate for the private sector, and his ability to delegate authority to his economic managers were all responsible for the dramatic turnaround in investment and growth in both East and West Pakistan, in sharp contrast to the economic stagnation in the second half of the 1950s.”

All this is correct but it is interesting — and revealing — that Hasan makes no mention of the four equally important developments of this period that were as responsible for promoting growth as those he does identify. The only hint his analysis has of the importance of financial development for growth is the “unhesitating” use of foreign economic assistance. As we will see below, some of this assistance was channelled to industry and finance through development finance corporations. Hasan is not alone in not factoring in the importance of finance in advancing growth — or, conversely, distorting the pattern of growth and increasing bureaucratic and political corruption — in the country.

Hasan’s is a more recent work on Pakistan’s economic history. An equally seminal book was written by Gustav F. Papanek, who had spent many years advising Pakistan’s Planning Commission. Published in 1967, Papanek’s book analyzed what came to be celebrated as the decade of development, the eleven years of Ayub Khan’s stewardship of the Pakistani economy. Although Papanek devoted a long section to the origin, management and contribution made by Pakistan Industrial Development Corporation, he devoted practically no space to the overall development of the financial sector or to the institutions that operated or were established by the Ayub government in that part of the economy.

It is important to underscore the absence until very recently of the importance of finance in academic and developing thinking in Pakistan. Such absence invariably influences public policy. It does not highlight both the positive and negative role financial policies can play in the development of an economy, in particular the economy in the developing world. Let us get back to the period of Ayub Khan and identify the four areas of financial development that were so critical for promoting growth at that time. These included the expansion in the role of commercial banks and development finance corporations, the development of capital markets, and the establishment of institutions to broaden the ownership of assets in the sectors of industry, communications, commerce and finance. Ayub Khan’s approach to the development of the finance sector was also to influence the way this important sector was treated by the generations of politicians who followed him into power in Islamabad.

Under President Ayub Khan, Pakistan’s financial sector developed rapidly, evolving — but for one area — in the right direction. The military leader continued with the policies initially adopted by Mohammad Ali Jinnah. He favoured the development of commercial banking in the private sector. During the 1960s, commercial banks greatly increased their activities, reaching out to potential savers in all parts of the country. The banks opened their branches in even the most remote parts. Habib Bank was joined by United Bank and Muslim Commercial Bank in the private sector while the National Bank of Pakistan, a publicly owned commercial bank, also expanded its operations. The commercial banking sector attracted a number of young professionals who were to play an important role in Pakistan’s economic history at a later time.

Not only did the Ayub government encourage the expansion of commercial banking. It allowed it considerable operational latitude. It adopted the approach that was favoured in Europe and the emerging markets of East Asia in that industrial houses were allowed to own banks and permitted to draw funds for investment from them. A very close relationship developed between a number of industrial and financial houses with the inevitable consequence of the banks not subjecting the loans requested by the industrial houses to appropriate due diligence. Pakistan saw the emergence of “crony capitalism” long before this term came to be used for lending practices adopted by the banks in East Asia.

It was the birth of crony capitalism or the close links between a small number of financial and industrial houses, both owned by a handful of very wealthy families, that was to give rise to the notion that a significant part of the wealth created during Ayub Khan’s decade of development went into the pockets of the rich. This impression — for it was no more than an impression since facts spoke of an improvement in income distribution and a reduction in the incidence of poverty — led to the raising of the “22 families” slogan by Mahbubul Haq, Planning Commission’s chief economist, to the fuelling of the political agitation against the military leader in 1968-69 and, eventually, to the ill-fated nationalization of businesses and banks ordered by the government of Zulfikar Ali Bhutto.

Development finance corporations constituted the second area of emphasis during the Ayub period. His government further expanded the role of DFCs adding Agriculture Development Bank to the three institutions that were already in place. The ADB — as was the case with PIDC, PICIC and IDB — obtained a line of credit from the World Bank. In the 1960s and 1970s, the DFCs continued to be favoured by the multilateral development banks and Pakistan was one of the countries to be favoured.

The third important initiative taken by the government of Ayub Khan in the field of finance was to develop capital markets. Entrepreneurs seek finance from generally three sources — their own savings, or savings of friends and relatives; the banking sector; and the capital markets. Much of Pakistan’s early industrialization was financed from the first source while the second wave of investment in the late 1950s and early 1960s came from the banking sector. In the 1960s, the government of Ayub Khan began to promote the development of capital markets in which new companies or companies undertaking expansion and modernization could raise funds.

Equity capital became a popular source of money for industrialization. The Karachi Stock Market — the only one in operation at that time — began to list a large number of companies through IPOs — initial public offerings. By getting companies to raise capital through the equity market, the government was able to broaden the base of industrial and financial ownership.

This was also helped by two financial institutions, the National Investment Trust (NIT) and the Investment Corporation of Pakistan (ICP), which acted as intermediaries between small savers and entrepreneurs seeking funds for investment. This was the fourth element in financial engineering undertaken during the Ayub period. The NIT was an open-ended fund with no limits placed on the amount of money it could raise from interested investors. It obtained money by making available its “units” which could be sold or bought with relative ease. The ICP floated “closed end” funds with specified limit on the amount of money to be raised and some indication as to how the funds obtained would be invested. The ICP shares were quoted on the stock markets and, like the NIT units, were also very liquid.

A significant amount of the large amount of investment made in industry during the Ayub period was financed from the capital markets. Bank financing remained important but increasingly entrepreneurs raised funds by offering equity in the stock markets.

Along with the development of commercial and development banking, the growth of the equity markets and broadening in the ownership of industrial assets was an important development during the Ayub era and contributed to the impressive growth of that period. But the government did not pay much attention to the simultaneous development of the regulatory system. This proved to be the Achilles’ heel of the financial sector under Ayub Khan.

With calmness, not hysteria

A FRIEND of mine, given to reading newspapers and watching BBC and CNN, came to see me last week. He confessed to being somewhat befuddled by the letter written by Choudhary Shujaat Hussain to George Bush urging him to review the INS policy for registration of Pakistanis.

“Will such a letter ever be read by George Bush?” he asked me, deadpan. I told him that I didn’t think so and George Bush, in any case, was preoccupied with Iraq and North Korea and the war on terror. The registration and the attendant humiliation of Pakistanis in the United States did not constitute a clear and present danger, that Pakistanis in the Unites States did not possess weapons of mass destruction.

In any case, I told him that Mr Kasuri, the foreign minister, had put forward his scheduled visit to Washington DC and he would, no doubt, express the concern of the government. “Will it do any good?” he asked me and I was not sure whether he was pulling my leg but since the subject was no laughing matter, I went along with him and said that I doubted that it would make any kind of impression. However, I added, it might play well domestically. “Exactly,” he said.

What is happening to Pakistanis in the Unites States is an outrage but there is nothing that we can do about it. Any protest we make will be of no avail. The United States has once again been gripped by a fear psychosis. Way back in the 1950s, Wisconsin Senator, Joseph McCarthy had his own little version of the Spanish Inquisition, an hysterical attempt to root out the communism that he thought he saw climbing the walls around him. I was then studying at the University of Southern California and can claim to have lived through some of the McCarthy years.

I have written about those years in my book As Time Goes By. What had shocked me was how easily fascism can take root even in a country that prided itself on its democracy and the many freedoms enshrined in its way of life. Let me quote from my book, written much before 9/11.

“He (McCarthy) held a nation to ransom, showed me a side of America I could not have imagined in my worst nightmares. There was a large section of the public that supported him and a large section of the public that had just kept silent. Those who opposed him could be counted in double-digits. As the newspaper Boston Post pointed out: “Attacking him (McCarthy) in this state is regarded as a certain method of committing suicide.” It seemed almost, as if, the US Constitution had been suspended.

“One protester had stood on a street-corner and read aloud the preamble to the Constitution. He was picked up for making a subversive speech that preached communism. No one at USC was prepared to discuss McCarthyism. It must have been as it had been in Nazi Germany or what it must have been like in Stalin’s Russia. How was McCarthy’s America different? To have asked this question would have had the dogs of McCarthy snapping at one’s heels. Those who did talk to me about it said that it was a temporary phase. But I would tell them that once you have malaria, you may get cured but its strains remain in the blood-stream. Today it was communism, tomorrow, it could be something else.”

“That something else” has materialised and the same methods are being used — baseless, sweeping, shotgun allegations and suspicions. The target is meant to be terrorists and since they cannot be identified, the target is broadened and includes, willy nilly, Middle East type Muslims in which category the Pakistanis are also included. In the McCarthy years, one did not feel any personal danger. Not so, this time round. There have been reports of harassment of Pakistani families, attacks on their shops and so on.

A climate of fear and a season of paranoia. The Pakistani communities in the United States and in other countries have never been associated with violence and crime or anything remotely illegal. They have been peace-loving and hard working. If some of them have entered the United States with forged documents, there are thousands of illegal immigrants from Mexico in California and in Texas. There are Cuban refugees and indeed the Bay of Pigs was launched from Florida, an invasion of a sovereign country.

Not for the first time has the Muslim world remained silent. It is all very well, individual governments making their muted protests. Why can the OIC not meet and demonstrate its disapproval of discriminatory laws that amount to a slander of our religion? Pakistan is now a member of the Security Council of the United Nations. Why not take this up at that level?

It will almost certainly be shot down but let it be. At least the effort would have been if only as a gesture. The United States should be told that we in Pakistan are also threatened by terrorism and its policies are increasing the number of terrorists, not reducing or eliminating them. The world should have got safer with all the measures taken after 9/11. The very reserve, is true. And North Korea adds a new dimension of terror. All matters worth pondering over, with calmness rather than hysteria.

The ‘demon of error’

DEATH penalty opponents wishfully described US state Illinois Governor George Ryan’s decision to empty out Illinois’ death row as the beginning of the end of capital punishment in the United States.

Maybe. Less sweepingly, it should prompt thoughtful people on both sides of this bitter issue to find common ground in banishing what Ryan called “the demon of error” that has “haunted” its application. Congress could start in this session by passing a long-ignored package of reforms to help ensure that only the guilty are condemned to death.

As one of his final acts in office, Ryan spared the lives of all 167 inmates slated to die in Illinois, changing their sentences to 40 years or — in 164 of the cases — life without parole. Ryan’s clemency announcement came the day after he pardoned four others on death row who were said to have been tortured into confessing.

Though the families of murder victims furiously denounced Ryan for waiting until virtually his last day in office, which allowed him to scamper away from news cameras and evade voter retribution, the governor’s proclamation was a long time in coming.

In separate investigations over the last four years, Chicago Tribune reporters and Northwestern University students and faculty members concluded that close to 200 Illinois inmates had been convicted of capital crimes on suspect evidence or represented by shoddy lawyers or could be exonerated with DNA evidence.

Ryan, a Republican, credited these recent probes with launching “my journey from staunch supporter of capital punishment to reformer.”

As fallible as Illinois’ death penalty system is, it does far better than many in giving defendants a fair trial and competent counsel.

Even in California, where the state Supreme Court automatically reviews all death sentences, there are no statewide standards that govern prosecutors in deciding whether to ask for death.—Los Angeles Times

Franco-German cooperation

THE REST of Europe has always been ambivalent about Franco-German cooperation, complaining of drift when the two countries have not been close and of being bossed around when they are strongly aligned.

Le Monde noted this perennial fact in commending the agreement last week between Paris and Berlin on constitutional proposals for the EU, which may be followed soon by proposals for parallel social legislation in the two countries and a degree of integration in defence policy.

The paper concluded that France and Germany must now proceed with tact in urging these ideas on their partners. But are these ideas genuinely coherent? The problem of Franco-German cooperation for Europe has usually been not a seamless unity between the two nations but a divergence of interests covered over by rhetoric and temporary deals. That is as true now as it has ever been.

France and Germany have merely postponed their differences over the proper shape of the EU by agreeing to combine one change that would strengthen the Europe of the Nations which France favours and another that would favour the federal Europe which Germany espouses. Their differences over agricultural and environmental policy were similarly put off into the future by the bargain last October in which Germany set aside for some years its hopes for a reformed European agriculture.

Their differences over Iraq are deep, and over defence policy in general deeper still. But, as in the past and despite these problems, what is shaping their relationship is political need.

Chancellor Gerhard Schroeder is, at the moment, the weakest political leader in Europe, his recent victory in general elections and his commanding performance during the emergency caused by widespread flooding a distant memory. He is down because the economy is down, with unemployment topping four million and investment falling.

Public sector strikes have been averted but at a high cost, suggesting that in time further tax increases will follow those that have already plunged him to the bottom of the polls. These show his party 30 per cent behind the opposition Christian Democrats, and the result in important elections next month in Lower Saxony could mean that the Christian Democrats will have the decisive say in the Upper House, a further humiliation and a further problem for the chancellor.

Jacques Chirac, by contrast, is a strong leader, even if his comfortable position is attributable to an unexpected political accident rather than to his own merits. In these circumstances, his instinct has been to take advantage of the shifting fortunes of his counterparts in other countries, especially in Germany and Britain. His position on Iraq is as pivotal as that of Britain, while he has been able to take the lead in the relationship with Germany in a way that would have been inconceivable a year or two ago.

Schroeder needs something to be going on internationally which restores some of his dignity, reminds people that he is an important head of government, and distracts them at least a little from his difficulties at home. That cannot come from the US, because of the estrangement following his refusal, during the election campaign, to allow Germany to join in what he called the risky adventure of war with Iraq, nor from Britain.

In any case, the credit he has for his stand on Iraq with a certain section of the German population, and with his coalition partner, the Green party, is an asset he could not afford to hazard.

So the turn to France was natural, especially as the 40th anniversary of the Franco-German friendship treaty of 1963 signed by Charles de Gaulle and Konrad Adenauer falls on January 22. It was always going to be marked both by ceremonies and by new agreements and arrangements designed to show that the friendship flourishes.

Yet it is not so long ago that most people believed that reunited Germany was bound to become the senior partner in the Franco-German relationship, if indeed it allowed that relationship to continue in anything like the old form. For a decade, Europe waited for Germany’s new weight to come fully down on the scales, and it has yet to happen, which does not of course mean that it will not happen in time.

Indeed, it can be argued that it will and it should. The Iraq crisis has had the effect of slowing the process by which Germany was becoming a more forceful international actor and a “normal” military power, although it has not stopped it, as deployments to the Balkans and Afghanistan have shown.

To put recent events into perspective, it is worth recalling that the treaty De Gaulle and Adenauer signed papered over differences more radical than those of today. The general had by 1963 failed to win over Adenauer to policies that would have stripped the European community and Nato of much of their substance.

Both De Gaulle and Adenauer worried about the US, but their anxieties went in different directions. The general worried about American dominance, while the chancellor feared that Germany might suffer the consequences of an abdication of US power in Europe through a deal with the Soviet Union that would unify but neutralise his country. De Gaulle and Adenauer also worried about European institutions, but again for different reasons. The general thought them too strong and argued for their abolition or reduction, while the chancellor judged them too weak and wished them to be strengthened.

The American historian William Hitchcock, in his excellent new account of Europe since 1945, The Struggle for Europe, quotes Adenauer as saying: “I have completely lost confidence in General de Gaulle.” By the time the friendship treaty was signed, Hitchcock writes, “Adenauer had in fact derailed De Gaulle’s ‘Europe of Nations’.” Something of this old tension remains. In dilute form, the differences on the organisation of Europe are still there.

In security matters, the French impulse to challenge US power in normal times but to fall in behind it in moments of great emergency represents another continuity. Beneath the differences in French and American military thinking there are some similarities. Recent discussions in the French parliament on the five-year plan for the armed forces show attitudes and ideas closer to the US than to those of Germany.

And, in terms of deployable military strength, Britain remains the only obvious serious partner for France in any integration of European armed forces. Germany, where increased spending on military forces is even less likely now than it was before the present economic troubles overwhelmed Schroeder, is much less suitable.

Europe’s problems as it tries to reorganise itself politically at a time of international crisis over Iraq and perplexity over future relations with the US are not likely to be made worse or better by truly concerted Franco-German policies.—Dawn/Guardian Service