Europe Awaits U.S. Midterm Election Results

Besides igniting a conflagration in the Middle East that has the potential to dwarf all others of the last 40 years, Trump's war on Iran, which began phase two yesterday with punishing sanctions on the Iranian energy and banking sector, is a challenge to Europe. Can Europe act on its own or is it merely an appendage of the United States?

We'll find out shortly.

The European Union has vowed to stick with Iranian nuclear deal, the JCPoA, the deal that Trump is trying to scuttle. In order to keep Iran's economy from collapsing, Europe must find a way around U.S. control of the global banking system.

Steven Erlanger reports in "As U.S. Sanctions on Iran Kick In, Europe Looks for a Workaround" that

But the Europeans have found it difficult to set up an alternative payment mechanism to sidestep the American-dominated banking system and allow Iran to continue selling its oil and goods. The so-called special purpose vehicle would act as a clearing house: Iran’s proceeds from sales of oil and gas would be offset against Iranian purchases, a form of barter without explicit financial transactions.

So far, however, no European country has agreed to host the vehicle, for fear of American retaliation.

In a joint statement issued on Friday, the European Union foreign policy chief, Federica Mogherini, and the foreign and finance ministers of Britain, France and Germany said they “deeply regret” the reimposition of American sanctions and that work would continue to set up the special payment vehicle.

“We remain committed to implementing” the nuclear deal “as a matter of respecting international agreements and of our shared international security, and expect Iran to play a constructive role in this regard,” the statement said.

Realistically, European officials say, they may be able to preserve only 20 percent to 30 percent of existing trade with Iran, given that large European companies with ties to the United States have already pulled out of Iran or are in the process of doing so to avoid the sanctions. Stefano Stefanini, a consultant and former Italian diplomat based in Brussels, said that the European officials think 40 percent would be optimistic.

Of all the issues between Europe and the Trump administration, Iran has become the most divisive. The Europeans are actively working against United States policy, which effectively puts them in league with Russia, China and Iran.

“It is a huge strain in the trans-Atlantic relationship,” Mr. Stefanini said.

If the Europeans manage to create “a small breach in the hold that the U.S. has on international financial transactions, that could be replicated,” he said. And if they fail, he said, “it will be another big grievance with Washington, creating another minefield.”

So far, European unity is holding, but there are worries among some European officials that Britain may not remain so firm in the face of a Washington that wants to give little quarter to Iran.

There is plenty to be skeptical about in terms of Europe's chances of pulling this off: Germany is headed for elections sooner rather than later; the UK, for Brexit; Italy, for confrontation with Brussels. It's not a propitious time to strike a blow to dollar hegemony and erect the foundation of a future multi-polar world.

On the other hand, the existential nature of the breech between Europe and the United States is reason for hope. It is now -- after the about-face on the JCPoA, after Yemen, after Khashoggi -- undeniable in elite circles that the U.S. is an unhinged, predatory, destructive power. There is no pot of gold at the end of the U.S. rainbow. It's all death and destruction.

Capitals around the globe are watching to see what happens today. Does the population of the "indispensable nation" support this rainbow of death and destruction?

If Trump somehow manages to hold the House for the GOP, and thereby earns distinction as a super-historical figure of realignment in a class with FDR, then Europe will have to quickly get busy building bridges to Russia and China.

Then again if the Democratic vote is solid and Trump is rejected by a wide margin Europe will probably want to dawdle for another couple of years waiting for the next Obamaesque neoliberal savior to materialize in 2020 and knit the uni-polar world back together.