In this issue:

Britain Orders Reservists To Mobilize

New Archbishop of Canterbury Warns Iraq War Could Lead to Nuclear Conflict

Reactions to the Turkish Election Results

Giscard d'Estaing: Turkey Doesn't Belong in European Union

Germany, France Propose To Redefine Euro 'Stability Pact'

More European Banking, Insurance Disasters

New York Post Devotes Two Pages to Latest Royal Scandal

From Volume 1, Issue Number 36 of Electronic Intelligence Weekly, Published November 11, 2002

WESTERN EUROPEAN NEWS DIGEST

Britain Orders Reservists To Mobilize

"This is a very drastic measure; it's what we would have done if the Russians had invaded Western Europe, and for reasons of national survival," a British defense source told the London Daily Telegraph Nov. 4, speaking of the call-up by Britain's Blair government of 10,000 reservists for possible action in Iraq. The paper wrote, "In a move not seen since the Korean War, a Queen's Order will give defense chiefs widespread and highly controversial rights to call up many more people than would normally be available. Senior officers from all the units involved have been summoned to a meeting at the Ministry of Defense today, to be briefed on the mass mobilization.... The Queen's Order, which has to be signed by the Queen, will ensure that the Armed Forces have the largest possible pool of reservists to call upon.... Normally, reservists need only serve for six months, in any two years. But a Queen's Order allows them to be called up indefinitely, no matter how recently they served."

The Telegraph added that the mobilization "is expected to be matched in America this week," as in fact it was.

New Archbishop of Canterbury Warns Iraq War Could Lead to Nuclear Conflict

In a Nov. 5 interview with the London Telegraph, incoming Archbishop of Canterbury Dr. Rowan Williams warned that a war against Iraq could lead to nuclear conflict. Williams cautioned that a preemptive strike against Iraq could "rapidly and uncontrollably spiral down into chaos."

The Archbishop of Canterbury is the primate of the worldwide Anglican Communion (in England, the Church of England; in Africa and Asia the Anglican Church; in the U.S., the Episcopal Church, etc.).

The interview is Williams' first public statement since the retirement of his predecessor, Dr. George Carey. Williams said the Iraqi regime is "brutal and violent," but preemptive action could "undermine the society of states" and destabilize other parts of the world. To ignore the fears of people in the region is to leave the West open to charges of behaving like a colonial power, he argued.

Reactions to the Turkish Election Results

A Turkish source involved in the media expressed optimism that last Sunday's election results in Turkey could represent a turning point for his country. The source, who has closely followed and supported Lyndon LaRouche's policies for years, said that Erdogen, the head of the victorious AKP, did an admirable job when he was Mayor of Istanbul, the biggest city in the country, with 12 million people. His credentials from that, combined with the targetting of him by factions of the Turkish military, who jailed him for six months and banned him from holding elected office, were the basis for the landslide electoral victory of his party Nov. 3. The source forecast that, once the new Parliament has been installed, within two weeks, there could be a vote to alter the Constitution, to allow Erdogen to take office.

The source also worried that the factions of the Turkish military who are aligned with the Israelis, and the Wolfowitz-Perle crowd in the U.S., could carry out a coup.

A U.S. intelligence source doubted that the military would move immediately against Erdogen, given the magnitude of the electoral win. All the "establishment" parties in Turkey have been totally discredited for their failure to do anything about Turkey's economic disaster. The source indicated that the election would harden those in Turkey who oppose any military operation against Iraq, although he cautioned that under the post-Gulf War status quo, Turkey has suffered tremendously from sanctions, embargoes, and no-fly zones.

Meanwhile, "U.S. officials are horrified" by the Turkish election results, said an expert on U.S.-Turkey relations quoted in USA Today—even though, officially, the Bush Administration has congratulated the victorious Justice and Development Party. "The future is murky," said U.S. Ambassador to Turkey Mark Parris, in speaking to the Washington Institute on Near East Policy. The major concern cited, is uncertainty about the new government's posture on possible war with Iraq.

Giscard d'Estaing: Turkey Doesn't Belong in European Union

Within a few days of the Turkish elections, former French President Valery Giscard d'Estaing had declared, according to the Nov. 9 Washington Post, that Turkey does not belong in the European Union.

Giscard gave an interview to the Paris daily Le Monde, which coincided with the arrival of Turkey's victorious party leader Erdogen in Europe on Nov. 8; in the interview, Giscard said bluntly that Turkey has no place in the European Union, because it is not a European country, it has a different culture, and a Turkish seat at the European table would wreck the EU. Turkey has sought, with increasing desperation, to become an EU member for at least a decade now. Turkey is part of NATO, the Europe-pivoted Western defense pact, and has insisted on its dual heritage, as Near Asian and European.

Germany, France Propose To Redefine Euro 'Stability Pact'

As the global economic downturn devastates tax revenues all over Western Europe, the Finance Ministers of Germany and France met in Berlin Nov. 4 and desperately tried to find some clever re-formulation of the Euro Stability Pact criteria—the Maastricht Treaty which defines the austerity demands underlying the single-currency European Union—rather than admit the complete failure of the whole monetarist paradigm associated with Maastricht.

German Finance Minister Hans Eichel told the media after the meeting: "We need to achieve a more complex coordination of economic policies. For instant inflation—here Germany is the anchor of stability. The Euro-12 group must discuss this."

French Finance Minister Francis Mer said the Stability Pact should be "refined" without "questioning" its principles. The European Union, Mer said, should progressively introduce "five fundamental parameters" in order to "improve the quality of the Stability Pact." Instead of just focussing on the budget deficit, the Stability Pact should also pay attention to inflation, employment, long-term economic sustainability (whatever this is supposed to mean), and public debt.

After the Berlin meeting, Eichel and Mer went to Brussels to participate in an EU Finance Ministers gathering Monday evening. At this event, the other Finance Ministers, at least in public statements to the media, put out fervent commitments that they will never give up fulfilling the Euro budget deficit requirements. Pedro Solbes, the European Union Commissioner for Economic and Monetary Affairs, made clear, however, that there is absolutely no chance that Germany's budget deficit this year will stay below the limit of 3% of Gross Domestic Product. He said, "There is going to be marked overshoot in Germany, a high overshoot," and in that case "we will have to trigger our excessive deficit procedure."

Greek Finance Minister Nikolaos Christodoulakis, who currently chairs the 12 Euro-zone Finance Ministers, summarized the discussion in Brussels by saying, "We all agreed on the credibility, usefulness, and flexibility of the stability and growth pact." Recently, of course, European Commission President Romano Prodi had denounced the pact as "stupid," and had blasted its rigidity.

More European Banking, Insurance Disasters

As of Nov. 8, the upheavals in the European financial sector, ranging from Zuerich to London and Frankfurt, were looking like this:

*Swiss Life, the largest insurer in Switzerland, on Nov. 6 fired its chief executive officer Roland Chlapowski after a scandal erupted around a secretive investment fund, Long-Term Strategy (LTS). According to allegations, the fund was used by the top management of Swiss Life to generate large profits by hidden transactions, while at the same time, Swiss Life itself was getting into ever bigger trouble. Chlapowski is the second chief executive officer to be ousted at Swiss Life this year. Only a few weeks ago, Credit Suisse, the second-largest Swiss bank, announced the resignation of its chief executive officer Lukas Muehlmann, following the near-bankruptcy of Credit Suisse's insurance arm Winterthur. Zurich Financial Services earlier this year fired its chief executive officer Rolf Huppi as well. That makes four fired CEOs among Switzerland's top financial firms so far this year.

*Royal & Sun Alliance Insurance Group, one of the largest insurance firms in Britain and among the top 10 property-casualty insurers in the world, announced on Nov. 7 that it will have to cut 12,000 jobs, 25% of its workforce. In addition, it will sell certain units in order to cut costs. Royal & Sun's chief executive officer Bob Mendelsohn was fired in September after the stock price of the firm had plunged by 70% since the beginning of the year. The insurer had not only been hit by mounting asbestos claims, but much of its core capital has melted away during this year's stock market crash.

*Commerzbank AG, the fourth-largest German bank, on Nov. 8 announced that it is considering eliminating another 2,000 jobs in order to cut costs. Already last year, Commerzbank had cut 4,300 jobs. The bank's bad loans are mounting, due to record-high corporate insolvencies, and at the same time its investment banking business has virtually disappeared. Among the planned job cuts will be 500 investment bankers—25% of Commerzbank's entire investment banking staff. The bank, which during the late 1990s was eager to become a leading player in global investment banking, this year could arrange just a single takeover deal, and therefore ranks only 128th in global mergers and acquisitions. In global stock offerings, Commerzbank has plunged to rank 138. Early next year, the bank will present a detailed downsizing plan which will probably include even further job cuts.

New York Post Devotes Two Pages to Latest Royal Scandal

The British Royals are again at the center of a firestorm of controversy, this time centered around allegations of a violent homosexual rape at one of the royal palaces, by a senior staffer in the employ of Prince Charles, according to the Nov. 8 New York Post. All the scandal has come out in the context of the cancellation of the trial of Paul Burrell, the long-time butler of the late Princess Diana, who was accused of stealing a large number of Di's personal possessions—including a wooden box containing a tape of Diana's interview with the rape victim. The Burrell trial was halted after the Queen revealed that Burrell had told her well in advance that he was taking some of Diana's possessions to his home for safe-keeping.

In July 2001, Scotland Yard officials had confirmed that it was probing a serious "sexual assault" at St. James Palace, the home of Prince Charles. Burrell has received $600,000 from the Daily Mirror to "tell all," and he has already talked of a three-hour private conversation with the Queen, shortly after Diana's Aug. 31, 1997 death in Paris, in which the Queen warned him of the threat of "dark forces" killing him.

Harrod's owner Mohammed al Fayed responded by throwing his support to Burrell's accounts, linking the Queen's alleged warnings of murder by "dark forces" to the role of MI5 and MI6—which, al Fayed insists, were behind the Paris car crash that killed his son Dodi and Princess Diana.

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