Wednesday, August 21st, 2002
: RCN Administrator
The Czech Republic Aug. 19 cancelled plans to buy 24 Jas-39 Gripen fighter jets. Prague cited costs from recent record flooding in Central Europe as being behind its decision not to place the $2 billion order. The announcement followed a week in which the Bush administration appeared, at least for the moment, to be backing off from its plans for a near-term attack on Iraq in the face of mounting domestic and international opposition.
Washington’s possible backsliding on Iraq, if that is indeed the case, will be viewed in Europe as a diplomatic victory for its efforts to counter perceived American "unilateralism." Combined with the historic flooding in Central Europe, this will give many European governments an excuse to shelve NATO-mandated defense outlays.
The exceptions may be France and Britain, which could see this as a prime opportunity to expand their power and make gains against Germany in terms of military strength and leadership in Europe. None of this, however, will help move Europe toward a more unified and capable defense identity.
Heavy rains over the last two weeks sent the Danube, Elbe and Vltava rivers spilling over their banks, sending floodwaters to unprecedented highs in the Czech Republic, Austria and eastern Germany. Less damaging floods also hit Slovakia and Hungary, and floodwaters still threaten northern Germany, Romania and Yugoslavia.
The physical damage to agriculture and crops, homes, office buildings and infrastructure has been massive. So too have the economic costs, as floodwaters have caused power outages, severed transportation links, forced retail stores, factories and even pipelines to shut down and displaced hundreds of thousands of people.
Germany, Austria and the Czech Republic have been hardest hit. Though no accurate assessment of the total costs of the flooding is yet possible (floodwaters are still moving), regional insurance adjusters cited Aug. 21 by Insurance Day estimated that combined property damage for those three countries is $21 billion: $15 billion for Germany, $3 billion for Austria and $3 billion for the Czech Republic.
Another estimate cited by The Associated Press topped $20 billion, and on Aug. 21 the finance minister for Germany’s hardest-hit state of Saxony estimated costs in his area alone would top $15 billion.
Czech farmers estimate total losses of around $130 million, while their German counterparts face losses of as much as $1.5 billion, according to the German Farmers Association.
Most of the flooding in Germany has occurred in the poorer eastern areas, prompting Chancellor Gerhard Schroeder to say of the cleanup, "It’s like beginning East Germany’s reconstruction from scratch." German rail and telecommunications companies Deutsche Bahn and Deutsche Telekom both estimate that the floods will cost them more than $100 million each.
These estimates have sent governments scrambling to figure out how to pay for the immediate costs of rebuilding, as well as how to compensate for damage downstream that will continue to mount. Germany, already bumping up against EU-mandated budgetary ceilings and seemingly unable to shake a persistent economic downturn, is going to have to get creative.
Schroeder’s Cabinet announced Aug. 19 that it will postpone tax cuts planned for next year until 2004 to free up $6.8 billion for flood repairs. But the opposition Christian Democrats -- whose partial support is needed to get the proposal through Germany’s upper house, the Bundesrat -- are against suspending the cuts. The government will have to make sacrifices, which rules out any rise in German defense spending in the near term and may even mean slight cuts to defense outlays.
That has already happened farther to the east. Prague had settled on the relatively low-cost Gripens to replace the country’s ageing fleet of Soviet-built Mig-21 planes, which would bring its air defenses up to NATO standards. But now Prague has shelved the order indefinitely. It also decided this week not to send any more soldiers to Afghanistan to support the war on terrorism, again blaming the floods.
That is bad news for NATO, which hoped its newest eastern members would upgrade their military hardware fairly soon. Budapest and Warsaw could take their cue from the Czech Republic and delay their defense outlays as well, which could encourage other European governments unaffected by the flooding to do likewise.
Back in Brussels, the increasing calls to close the military gap between Europe and the United States may be quieted for a time if Washington indeed backs down from its threats of immediate military action against Iraq. This would weaken arguments that Europe must spend more on defense in order to hem in U.S. power and will decrease pressure on governments across the Continent to pursue costly and largely unpopular military buildups.
The two exceptions could be France and Britain. Both are on more solid economic footing than Germany, and both have ambitions for leadership in any Europe-wide defense force. With Germany crippled by flood-induced budgetary problems, and with little choice but to keep its military spending in check, France and Britain could see this as the perfect time to make their move.
But that kind of jockeying is not what Europe needs if it hopes to create its own security and defense identity. What it lacks, and what recent events make even less likely, is a common and unified Europe-wide strategy to build its military strength independent of the United States.