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Cablegate: Media Reaction: U.S.-Eu, U.S.-China, Iran, Afghanistan,

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R 041407Z FEB 10
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC 6473
INFO RHEHAAA/WHITE HOUSE WASHINGTON DC
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"PERISHABLE INFORMATION -- DO NOT SERVICE"

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E.0. 12958: N/A
TAGS: OPRC KMDR US CH IR AF EU US ECON
SUBJECT: MEDIA REACTION: U.S.-EU, U.S.-CHINA, IRAN, AFGHANISTAN,
EU-GREECE, U.S.-SPACE, ECONOMIC-DAVOS;BERLIN

1. Lead Stories Summary
2. (U.S.-EU) Fallout from Cancellation of Summit
3. (U.S.-China) Arms Exports to Taiwan
4. (Iran) Nuclear Program, Missile Test
5. (Afghanistan) Karzai, Future Strategy
6. (EU-Greece) Financial Crisis
7. (U.S.) Space Travel
8. (Economic) Davos Economic Forum


1. Lead Stories Summary

ZDF-TV's primetime newscast Heute opened with a story on the token
strikes in the public service sector. ARD-TV's primetime newscast
Tagesschau and most papers led with stories on the EU response to
the budget crisis in Greece. Berliner Zeitung und Frankfurter
Rundschau led with stories no the German government's first 100 days
in office, and Sddeutsche led with a story on the debate over tax
havens. Die Welt carried a large front-page photo of yesterday's
event at the American Academy, showing elder statesmen, including
former Secretaries of State Kissinger and Schultz. Editorials
focused on the government's first 100 days and the financial crisis
in Greece.

2. (U.S.-EU) Fallout from Cancellation of Summit

President Obama's decision not to attend the EU-U.S. summit meeting
in Madrid no longer makes the headlines in the German press. Only
Sueddeutsche Zeitung (2/4) carried an editorial under the headline:
"Summit of Disappointment," and opined: "The world of diplomacy
hardly knows anything that is more impolite than to decline an
invitation to a summit and then inform the other side of this
decline through the media. For this reason, the Europeans are right
to look with a certain degree of irritation to Washington. We
should now not complain about the end of European-American
friendship but Obama's cancellation is, nevertheless, remarkable.
On the one hand, it demonstrates the domestic pressure on the
President. Obviously, Obama is not even able to leave Washington
for a mere 48 hours to meet his most important allies. The fear
that the Republicans could attack him during his absence is just too
great. But, at the same time, his cancellation makes clear Obama's
view of Europe. He is the first president who has no family or
emotional links to the old world. Obama's world is Africa, where
his father came from, and Indonesia, where he lived as a youth. The
President...does not want rhetoric, but results, in relations with
Europe and, in this respect, there are problems.... The Europeans
feel disrespected by the Americans, while the Americans feel left in
the lurch by Europeans. Even under the Obama government, this is
the prevailing bad mood. The Madrid summit would have been an
opportunity to tackle a few problems. That is what summit meetings
are there for - if they are not being cancelled."

3. (U.S.-China) Arms Exports to Taiwan

Weekly Die Zeit (2/4) carried an editorial under the headline:
"Yellow Card" with the sub-title: "Obama Modernizes [Taiwan's] Arms
System?" The paper wonders: "Is it really necessary for the U.S. to
interfere? The answer is 'yes,' because America has a special
responsibility for Taiwan. And as long as Taiwan is being
threatened by Chinese missiles, the U.S. must also show this
responsibility by shipping arms. These arms shipments, but
primarily the U.S. strategic ambiguity, are an insurance policy that
mean Taiwan will survive. They have forced China to pursue a course
of rapprochement, a path upon which China would otherwise probably
not have embarked. Now both powers are baring their teeth at each
other without the one being able to force the other to give in. And
that is why it is probably no coincidence that Barack Obama is now
carrying out an arms deal that originated with his predecessor.

Obama's experience with the Chinese seems to be completely the
opposite of ex-President Bush's. At the beginning of his term, Bush
had a lot of trouble with the Chinese leadership but later he
curried favor with it for the 'fight against terror.' Obama, in
turn, traveled with a lot of good will to Beijing in order to learn
afterwards that relations deteriorated month by month. If he were
Chinese, he would probably say he has lost face. Now Obama is
showing the Chinese their limits. He welcomed Beijing's rise, but
he does not want to put up with everything."

4. (Iran) Nuclear Program, Missile Test

Under the headline "Sensitive to pressure," Frankfurter Allgemeine
(2/4) editorialized: "Suddenly, Iranian President Ahmadinejad has no
problem with enriching uranium abroad. When exactly the same thing
was proposed to the Iranian regime last year, he brusquely rejected
it. How do you explain this change of mind-if it is one? The
international debate about new economic sanctions against Iran is
obviously having an impact on Tehran. The Obama government is
urging Congress and losing patience. The German government seems to
be willing to agree to sanctions even if 'only' like-minded nations
approved of them.... The West is right to be skeptical about
Ahmadinejad's 'no problem' statement. Far too often, he has made
fools of them. There is no reason to sound the all clear signal in
the nuclear dispute. This will only be heard when actions follow
the words of the Iranian leadership."

Sddeutsche (2/4) headlined "unexpected offer" and opined "If Iran
indeed gives in on the nuclear dispute, it would be an unexpected
confirmation of the P5 and Germany's negotiating strategy. The
carrot and stick approach would have been effective - shortly before
the discussion of UN sanctions begins. However, there have been
many announcements by Iran in the past. President Ahmadinejad's
statement is only worth something if he writes it down and sends it
to the IAEA, which had made the proposal for the deal. Iran can now
prove its credibility and alleviate the conflict by pursuing
confidence-building measures. As long as the uranium has not
reached Russia, there is no reason to slow down the efforts to
impose tougher sanctions. Ahmadinejad welcomed the deal before but
could not get it through the complicated power structures of the
regime. The restraint response in Washington, Paris and Berlin is
therefore appropriate and right. The danger that Iran is only
pursuing a tactical maneuver is too great. Iran knows that Russia
and China are skeptical about new sanctions. If the negotiating
group were now to fall apart, it would be an unexpected triumph for
Tehran."

An editorial in Berliner Zeitung (2/4) remarked: "The U.S. and Iran
look like two warriors of enemy tribes, facing each other in a
ritual dance. They go around each other making threats, retreat and
then attack again. Iran is currently making the impression as if it
is giving in, being impressed by the military movements in the
[Persian] Gulf and the potential comprehensive sanctions.... By
yielding, Iran wants to delay comprehensive sanctions and stop
Russia and China from agreeing to them. Particularly stopping fuel
experts to Iran would hit the Iranian economy.... The stop of
deliveries would have serious social repercussions. The proposal
buys Iran time that the West does not have. Iran will soon have the
ability to build a nuclear bomb. Israel does not want to accept
this threat. The situation could therefore soon get out of
control."

"Iranian Confusion," Handelsblatt (2/4) editorialized: "Is this the
turning point in the nuclear game of poker? It can be doubted. For
too often President Ahmadinejad made a fool of the West by making
compromises first and retracting them soon after, while
simultaneously pursuing the nuclear program."

Regional Volksstimme of Magdeburg (2/4) commented: "The news is that
things are moving in the nuclear dispute with Iran. After the
Iranian presidential elections in June, negotiations almost came to
a complete standstill. If President Ahmadinejad now announced Iran
is prepared to enrich uranium abroad, it can have two causes. First,
the pressure on the regime increases as domestic protests continue
and international sanctions look more likely. Secondly, the
announcement could be a purely tactical maneuver. Carrots and
sticks has been a successful strategy for Tehran in the nuclear
dispute. The West was therefore right to be restrained in its
response to the offer."

5. (Afghanistan) Karzai, Future Strategy

Frankfurter Allgemeine (2/4) editorialized on President Karzai's
visit to Saudi Arabia: "Karzai wants Riyadh to support the process
of reconciliation with his radical enemies. Without such a process,
the stabilization of Afghanistan will remain a mirage. In addition,
Saudi money could help improve Afghanistan's infrastructure."


Tagesspiegel (2/4) noted that the "exit program for moderate Taliban
can hardly be implemented during a phase of increased military
operations. In addition, experts doubt whether it can be
implemented without Pakistan's active support. As a result, the
West's new strategy on Afghanistan after the London conference looks
like the strategy before the conference."

Frankfurter Rundschau (2/4) analyzed NATO's financial problems and
its effects on the mission in Afghanistan. "Actually, NATO is
pursuing important goals in Afghanistan.... The mission is funded
not just by the countries but also by NATO itself. The problem is
that the organization is pretty broke. In the current financial
year alone, the budget lacks several hundred million euros. In the
medium term, we are even speaking of billions.... A fight is going
on behind closed doors about money. The key question here is
whether the money should be spent particularly in Afghanistan or
within the NATO area. While the military leaders, the Americans and
the Britons want a new headquarters in Kabul and improved satellites
communications, eastern and southern Europeans would like to see
their infrastructure being brought up to date.... Given that all
member states have high national deficits and some even face
bankruptcy due to the financial crisis, there will be no decisions
made during the NATO ministerial in Istanbul."

6. (EU-Greece) Financial Crisis

The Greek financial crisis is the main political story in the press
this morning (2/4). Tagesspiegel headlined: "EU Takes Over
Financial Control in Greece," while Die Welt led with a story
headlined: "EU Keeps Greece on a Short Lead - Greece Must Present
Report on Savings Course on a Quarterly Basis - Opening Of
Procedures Because of False Budget Figures." Handelsblatt's lead
story carried the headline: "EU Forces Athens Government to Initiate
Reforms," and Sueddeutsche Zeitung headlined: "EU Puts Greece under
Receivership."

In an editorial Sueddeutsche Zeitung (2/4) had this to say: "The
situation resembles the one of Lehman Bros. Its insolvency led the
world to a crisis that has not yet been overcome. First it was
Lehman and the banking crisis and now it is Greece and the state
crisis. History repeats itself. It repeats itself with respect to
the development of the crisis but not with respect to overcoming it.
It is still up to the EU governments to react in a better way than
President Bush and his backers who though it would be possible to
isolate and punish Lehman Bros. It would be a hazardous game to
attempt to do the same at the state level. If Greece fails, then
Portugal, Ireland, and Spain could fail, too. That is why [the EU]

must help with all the necessary brutality. The European Commission
took the first step by putting it under supervision; it practically
took away Greece's sovereignty. This is the worst imaginable
punishment for a nation but it is only logical in a community. Only
a crisis shows what a system is able to accomplish. The euro system
has many possibilities, even if it hurts."

In an editorial, Handelsblatt (2/4) judged: "The real signal of the
control program [for Greece] is: we look after you. And thus, it is
difficult to imagine that the EU would leave Greece in the lurch if
consolidation were to go wrong. The arsenal of possible assistance
is great: It ranges from direct or premature payments from
individual EU pots via loans to the commonly guaranteed bonds. In
case of doubt the EU will select the thing that is the least
noticeable, because EU citizens are not in the mood to show
financial solidarity. Nevertheless, the EU, even though no one
admits it, will increasingly turn into an enlarged mirror image of
what we know from Germany: In the end, all public budgets vouch for
each other."

Frankfurter Allgemeine (2/4) judged in a front-page editorial: "The
only thing that will currently help Greece is the consistent
application of existing rules. The repeated calls for help from the
outside - be it the IMF or bilateral assistance from other EU
states-- can only prompt the government in Athens to make excuses.
The argument of EU Commissioner Almunia is to say that, if the
savings measures that have now been announced take effect in a few
months, speculation about [Greece's] state bankruptcy would be over
and done with, too. But this argument is also true in the opposite
direction: If an effect is not visible by then, Greece would not
only face an abyss, then it would be with its foot in it."

In the opinion of Financial Times Deutschland (2/4), "it is good
that the EU is now applying the new instruments from the Lisbon
Treaty to Greece, but, as good as control is, the second part of the
solution is still lacking: credible possibilities of imposing
sanctions. Without the threat of punishment, even the best control
will not lead the Greek sinner back to the path of budgetary virtue.
The case of Greece is now turning into a test case for future
Monetary Commissioner Olli Rehn. He must prove that Brussels has
the euro countries under control even without effective
possibilities for sanctions. That is why one of his first actions
in office should be to prompt Portugal, Ireland, and Spain to show
greater budgetary discipline because a chain reaction is exactly the
thing the euro zone must avoid at any cost if it wants to safeguard
the stability of the euro."

Under the headline: "Enough is Enough, Athens!", weekly Die Zeit
(2/4) judged: "First the banks, now the Greeks? For whom should the
German taxpayer continue to pay? For years, Greece has violated the
rules of economic reason, and now it is faced with bankruptcy. And
the same game that was played in connection with the banks is now
looming with Greece. Because its bankruptcy would jeopardize the
international financial system, it may be possible that the taxpayer
must help out again. With their money they should help those
overcome their problems who have now proved that they do not know
how to deal with money. We could tear our hair out but this
situation could happen. But even more important is the question of
how a similar situation can be prevented in the future. It seems to
be necessary to create a new body that supervises the budget
policies of the EU members. Experts suggested a European Monetary
Fund, but whatever the shape of this institution, without greater
controls the Monetary Union will not survive."

Regional daily General-Anzeiger of Bonn (2/4) argued: "The entire
community must wonder what it will do in the future with a situation
that was unthinkable a while ago: What will we do if a country is
sliding into bankruptcy? Since this crisis, nothing can be ruled

out any longer."

7. (U.S.) Space Travel

Under the headline: "Nothing is Impossible," Die Welt (2/4) opined:
"It was left to President Obama to tell the enthusiastic U.S. space
travel nation the bitter truth: No we can/'t. There is simply not
enough money in the coffers for a trip to Mars or even to the Moon.
The formerly glorious NASA will now quickly lose its significance.
The wave of privatizations is now also reaching space travel.
Manned and unmanned space travel will now primarily serve corporate
goals. More than ever, one motto will now be valid for space
travel: competition stimulates business. In the coming years, the
cards will be reshuffled and then we will know which country is
heading for which destination in outer space. In individual cases
there could also be private public partnerships. The curiosity of
man is so great that we will certainly see people on the moon in
this decade - even without state programs."

8. (Economic) Davos Economic Forum

"Capitalism 2.0" is the headline in Die Zeit (2/4), which
editorialized: "What is the message from Davos? In view of the many
uncertainties, the answer has rarely been as difficult and as
interesting at the same time as today. On the large rostrums one
thing became clear: [The economic and financial] crisis will last
for more years to come and the question is who has to pay for it?
Pepsi Cola CEO Indra Nooyi, Google's Eric Schmidt and Co. are
anything but do-gooders but they have the strong feeling that
financial capitalism, including its thinking about capital markets,
should no longer dominate the markets because, first, their economic
approach is highly unstable; second, because one's own staff should
not only serve to achieve a quarterly profit; and third, because
society would no longer accept this economic approach. Advisors and
experts confirmed this message in Davos. When experts talked about
the necessary change of capitalism, they talked about long-term
expectations, greater stability, greater respect for the staff,
customers, and the environment - and of no less. And the earlier
the economy moves in this direction, the less regulatory power will
have to be used by the state."

MURPHY

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