Scholz: Russian energy ban would mean European recession

[ajay0]

German chancellor Olaf Scholz warned that an immediate ban on Russian energy imports would trigger an economic recession in Germany and across Europe, which is recovering from the covid pandemic for the last two years.

Scholz: Russian energy ban would mean European recession

Speaking to the Bundestag, Scholz said Germany would end its energy dependence on Russia in due course but cutting all ties now would hit the German economy when it was unprepared.

"We will end this dependence [on Russian oil, coal and gas] as quickly as we can, but to do that from one day to the next would mean plunging our country and all of Europe into a recession," the chancellor said, warning that "hundreds of thousands of jobs would be at risk, entire industries would be on the brink."

"The truth is that the sanctions that have already been decided also hit many citizens hard, and not just at the gas pump," Scholz continued, arguing that sanctions "must not hit the European countries harder than the Russian leadership."

Scholz's remarks represented a blunt rejection of calls from some EU countries, particularly in Eastern Europe, for a swift ban on Russian energy imports in response to Moscow's war in Ukraine.

His comments came as Germany's influential economic research institute Ifo cut this year's growth forecast for the national economy and raised inflation expectations, citing the effects of the war and sanctions.

As rising prices have already started hitting businesses and consumers, the chancellor announced further measures by Finance Minister Christian Lindner to alleviate the additional cost "in the coming weeks."

 

[Augustus]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

 

[ajay0]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

The policy planners must have surely seen it while brainstorming. But they are usually insulated from price hikes and inflation , which of course is not so for the masses whose views don't count for much and is secondary to strategic objectives .

 

[Heyo]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

... or the reliance on Euros would end up a strategic weakness for Russia.
Usually economic dependencies are seen as a deterrent for war as it is financially very unfavourable to start one. It takes a leader who doesn't understand that or who doesn't care. (And the "doesn't care" faction includes those who personally profit from it while the country suffers.)

 

[Heyo]

German chancellor Olaf Scholz warned that an immediate ban on Russian energy imports would trigger an economic recession in Germany and across Europe, which is recovering from the covid pandemic for the last two years.

Scholz: Russian energy ban would mean European recession

Not only would the European economy suffer, but we'd also have to break an international treaty to stop the payments. (And as we all know the economy is always above mere politics.)
But Putin may give us a reason to end payments by insisting the payments have to be in Rubel. I hope we'd take that opportunity if Putin presents it.

 

[exchemist]

German chancellor Olaf Scholz warned that an immediate ban on Russian energy imports would trigger an economic recession in Germany and across Europe, which is recovering from the covid pandemic for the last two years.

Scholz: Russian energy ban would mean European recession

One's gut reaction might be that a recession is a price we should be willing to pay to hasten the end of this butchery. But if one thinks in terms of history, one has to be aware that such a recession might have unintended consequences, such as undermining Europe's unity of purpose and even maybe strengthening authoritarian populism in Western democracies. We might, as it were, win the battle for Ukraine but end up losing the war for democracy. So he may be right to proceed in stages. Leaders in democracies, unlike autocracies, have to take their people with them.

But I see no good reason not to cut off oil and coal with immediate effect. That is a hit we can surely take. And from what I read, the coal can't be sold to other markets as no suitable rail transport exists for it in Russia.

 

[Brickjectivity]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

Lithuania did. They were motivated, as you can see from the map. They started preparing years ago, building the infrastructure needed to get fuel in other ways.

 

[exchemist]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

Yes. Merkel's decisions on energy look badly flawed. The exit from nuclear was equally foolish, being driven by emotion in the wake of the Fukushima episode. It was the sort of decision that only a very rich country with lots of other energy options could afford. [cue circus music and clowns]

 

[Augustus]

Lithuania did. They were motivated, as you can see from the map. They started preparing years ago, building the infrastructure needed to get fuel in other ways.

Everyone did, just some were more complacent (and corrupted) than others...

 

[Augustus]

Yes. Merkel's decisions on energy look badly flawed. The exit from nuclear was equally foolish, being driven by emotion in the wake of the Fukushima episode. It was the sort of decision that only a very rich country with lots of other energy options could afford. [cue circus music and clowns]

Also being driven by good old corruption and greed:

As Chancellor, Gerhard Schröder was a strong advocate of the Nord Stream pipeline project, which planned to supply Russian gas directly to Germany, thereby bypassing transit countries.

At the time of the German parliamentary election, according to Rick Noak of The Washington Post:

In 2005, Russian President Vladimir Putin's friend Schroeder hastily signed the deal just as he was departing the office from which he had been voted out days earlier. Within weeks, he started to oversee the project implementation himself, leading the Nord Stream AG's shareholder committee.[94]

On 24 October 2005, just a few weeks before Schröder stepped down as Chancellor, the German government guaranteed to cover 1 billion euros of the Nord Stream project cost, should Gazprom default on a loan. However, this guarantee had never been used.[95] Soon after stepping down as chancellor, Schröder accepted Gazprom's nomination for the post of the head of the shareholders' committee of Nord Stream AG, raising questions about a potential conflict of interest.

German opposition parties expressed concern over the issue, as did the governments of countries over whose territory gas is currently pumped.[96] In an editorial entitled Gerhard Schroeder's Sellout, the American newspaper The Washington Post also expressed sharp criticism, reflecting widening international ramifications of Schröder's new post.[97] Democrat Tom Lantos, chairman of the United States House Committee on Foreign Affairs, likened Schröder to a "political prostitute" for his recent behaviour.[98] In January 2009, the Wall Street Journal reported that Schröder would join the board of the oil company TNK-BP, a joint venture between oil major BP and Russian partners.[99]

In 2016, Schröder switched to become manager of Nord Stream 2, an expansion of the original pipeline in which Gazprom is sole shareholder.[100]

In 2017, Russia nominated Schröder to also serve as an independent director of the board of its biggest oil producer Rosneft.[101] At the time, Rosneft was under Western sanctions over Russia's role in the Ukraine crisis.[101] Schröder told Blick that he would be paid about $350,000 annually for the part-time post.[102] His decision caused an outcry in Germany and abroad, especially in a climate of fear about any potential Russian interference in the 2017 German elections.[103] German Chancellor Angela Merkel criticized her predecessor, saying "I do not think what Mr Schröder is doing is okay".[104]

In 2022, Schröder was nominated to the board of directors of Gazprom.[105]

Gerhard Schröder - Wikipedia

 

[Estro Felino]

German chancellor Olaf Scholz warned that an immediate ban on Russian energy imports would trigger an economic recession in Germany and across Europe, which is recovering from the covid pandemic for the last two years.

Scholz: Russian energy ban would mean European recession

I did know Scholz was a sensible man.

Unlike the unelected banker we have as PM.

 

[Estro Felino]

Not only would the European economy suffer, but we'd also have to break an international treaty to stop the payments. (And as we all know the economy is always above mere politics.)
But Putin may give us a reason to end payments by insisting the payments have to be in Rubel. I hope we'd take that opportunity if Putin presents it.

Putin demands payments in rubles because of the sanctions on the banking system.
He is just defending himself.

By the way, Scholz is right.

 

[Estro Felino]

If only anyone could have foreseen that total reliance on Russian gas would end up being a major strategic weakness...

A strength, actually.
Because Russians are the kind of country that my people love. Because of culture and other things. So it is a strength to trade with them.

 

[Augustus]

A strength, actually.
Because Russians are the kind of country that my people love. Because of culture and other things. So it is a strength to trade with them.

"It is a strength to be dependent on the goodwill of a foreign power with potentially hostile intentions"


War is peace. Freedom is slavery. 2 + 2 = 5.

 

[Augustus]

We are different countries. Wilders would get the 60% of votes here. Alone.

It wouldn't matter if Wilders got 100% and was elected Caesar for life, being dependent on the goodwill of a foreign power with potentially hostile intentions is never a strength and always a weakness.

Trade links and dependency are 2 very different things.

If Putin went to your house and pissed all over your living room, you'd blame the carpet

 

[ajay0]

"It is a strength to be dependent on the goodwill of a foreign power with potentially hostile intentions"


War is peace. Freedom is slavery. 2 + 2 = 5.

But you can ask the obverse too.

Is it a strength to be dependent on the goodwill of a foreign power that does not honor its promises and agreements made on Nato not expanding an inch eastward !

And expand it did to the very borders of Russia to create a highly volatile situation at present.

 

[Estro Felino]

It wouldn't matter if Wilders got 100% and was elected Caesar for life, being dependent on the goodwill of a foreign power with potentially hostile intentions is never a strength and always a weakness.
Trade links and dependency are 2 very different things.
If Putin went to your house and pissed all over your living room, you'd blame the carpet

Russia has never done anything to us.
We have no reason to sanction her.

That said, there are always diplomacy and negotiations to settle international issues. Not warfare.

 

[exchemist]

But you can ask the obverse too.

Is it a strength to be dependent on the goodwill of a foreign power that does not honor its promises and agreements made on Nato not expanding an inch eastward !

And expand it did to the very borders of Russia to create a highly volatile situation at present.

There never was any such agreement.

There was a verbal assurance, during the discussions about German unification, not to move NATO troops any further East, i.e. not to station foreign troops in E Germany. That's all there was. NATO has always had in its articles of association openness to states joining and that was never altered, nor was an alteration ever demanded.

There is a lengthy discussion of all this here: PolitiFact - Fact-checking claims that NATO, US broke agreement against alliance expanding eastward

 

[exchemist]

Also being driven by good old corruption and greed:

As Chancellor, Gerhard Schröder was a strong advocate of the Nord Stream pipeline project, which planned to supply Russian gas directly to Germany, thereby bypassing transit countries.

At the time of the German parliamentary election, according to Rick Noak of The Washington Post:

In 2005, Russian President Vladimir Putin's friend Schroeder hastily signed the deal just as he was departing the office from which he had been voted out days earlier. Within weeks, he started to oversee the project implementation himself, leading the Nord Stream AG's shareholder committee.[94]

On 24 October 2005, just a few weeks before Schröder stepped down as Chancellor, the German government guaranteed to cover 1 billion euros of the Nord Stream project cost, should Gazprom default on a loan. However, this guarantee had never been used.[95] Soon after stepping down as chancellor, Schröder accepted Gazprom's nomination for the post of the head of the shareholders' committee of Nord Stream AG, raising questions about a potential conflict of interest.

German opposition parties expressed concern over the issue, as did the governments of countries over whose territory gas is currently pumped.[96] In an editorial entitled Gerhard Schroeder's Sellout, the American newspaper The Washington Post also expressed sharp criticism, reflecting widening international ramifications of Schröder's new post.[97] Democrat Tom Lantos, chairman of the United States House Committee on Foreign Affairs, likened Schröder to a "political prostitute" for his recent behaviour.[98] In January 2009, the Wall Street Journal reported that Schröder would join the board of the oil company TNK-BP, a joint venture between oil major BP and Russian partners.[99]

In 2016, Schröder switched to become manager of Nord Stream 2, an expansion of the original pipeline in which Gazprom is sole shareholder.[100]

In 2017, Russia nominated Schröder to also serve as an independent director of the board of its biggest oil producer Rosneft.[101] At the time, Rosneft was under Western sanctions over Russia's role in the Ukraine crisis.[101] Schröder told Blick that he would be paid about $350,000 annually for the part-time post.[102] His decision caused an outcry in Germany and abroad, especially in a climate of fear about any potential Russian interference in the 2017 German elections.[103] German Chancellor Angela Merkel criticized her predecessor, saying "I do not think what Mr Schröder is doing is okay".[104]

In 2022, Schröder was nominated to the board of directors of Gazprom.[105]

Gerhard Schröder - Wikipedia

Schröder certainly looks to be a crook.

However I don't believe the decision to build Nordstream 2 was his alone, nor that it was it in principle a bad one. After all there was and is merit in building trade links with a sensible Russia. The mistake was to allow Germany to become strategically dependent on Russian gas with no alternative. At the very least, they should have built themselves some LNG import and re-gasification facilities and had some kind of back-up supply contracts with others. It was greedy and short-sighted not to spend that extra money for something to vital to their economy. There were plenty of voices advocating this but they were ignored.

 

[ajay0]

There never was any such agreement.

There was a verbal assurance, during the discussions about German unification, not to move NATO troops any further East, i.e. not to station foreign troops in E Germany. That's all there was. NATO has always had in its articles of association openness to states joining and that was never altered, nor was an alteration ever demanded.

There is a lengthy discussion of all this here: PolitiFact - Fact-checking claims that NATO, US broke agreement against alliance expanding eastward

Yes, I am aware of this . I have posted two threads in this regard...

Noam Chomsky on NATO...

Christopher Hedges on Nato...