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Hours after the publication of a bombshell CIA report claiming that Saudi Crown Prince Mohammad bin Salman had almost certainly ordered the killing of Saudi dissident and former US resident Jamal Khashoggi, responses from lawmakers and senior US government officials – including the president himself – are rolling in.

One of the first to respond was none other than Bob Corker, the outgoing chairman of the Senate Foreign Relations Committee, who said he believed the CIA’s conclusion that MbS ordered the killing, and demanded that the administration “do something” to hold MbS accountable and stop the kingdom from executing the five suspects who had been set up to take the fall for the murder.

“Everything points to the Crown Prince of Saudi Arabia, MbS, ordering @washingtonpost journalist Jamal #Khashoggi’s killing,” Corker said. “The Trump administration should make a credible determination of responsibility before MbS executes the men who apparently carried out his orders.”

Everything points to the Crown Prince of Saudi Arabia, MbS, ordering @washingtonpost journalist Jamal #Khashoggi‘s killing. The Trump administration should make a credible determination of responsibility before MbS executes the men who apparently carried out his orders.

— Senator Bob Corker (@SenBobCorker) November 17, 2018

Corker also tweeted a statement about the possibility of imposing Magnitsky Act sanctions on senior Saudi officials believed to be involved with the killing. In the statement, he said the Treasury Department sanctions against 17 Saudis, including a top aide to the Crown Prince who is suspected of having organized the 15-man hit squad that carried it out, was a “significant step.”

I have a lot of concerns about the trajectory that Saudi Arabia is on right now, and I think a price needs to be paid. My full statement on the Global Magnitsky sanctions against Saudi officials for the murder of #JamalKhashoggi: pic.twitter.com/EEM0HzGgwg

— Senator Bob Corker (@SenBobCorker) November 15, 2018

President Trump, who has notably toned down his rhetoric about the killing and MbS’s potential complicity, doubled down on Saturday when he defended the US’s “spectacular” relationship with the Saudis and once again pointed to the massive number of jobs and investments he said Saudi Arabia brings to the US.

“We’re taking a look at it. You know, we also have a great ally in Saudi Arabia,” Trump said. “They give us a lot of jobs, they give us a lot of business, a lot of economic development. They have been a truly spectacular ally in terms of jobs and economic development.”

Trump continued: “And I also think that you know, I’m president, I have to take a lot of things into consideration so we will be talking to the CIA later and lots of others. I’ll be doing that while I’m on the plane. I’ll be speaking also with Secretary of State Mike Pompeo.”

Trump added that he had not yet been briefed about the CIA’s report, he also said that he’d be speaking with Secretary of State Mike Pompeo.

President Trump said he will be briefed today on the CIA report that Saudi Crown Prince Mohammed bin Salman ordered the killing of journalist Jamal Khashoggi while also calling Saudi Arabia “a truly spectacular ally.” https://t.co/nBN7c0XUnK pic.twitter.com/RxNtSXEZ8k

— NBC Nightly News with Lester Holt (@NBCNightlyNews) November 17, 2018

Playing the bad cop to Trump’s good cop, Vice President Mike Pence delivered a decidedly more aggressive statement about the CIA report, telling a group of pool reporters on Saturday that “couldn’t comment on classified information” but assured them that Khashoggi’s death was an “atrocity” that would be punished by the US, per the Hill.

“It was also an affront to a free and independent press and the United States is determined to hold all of those accountable who are responsible for that murder,” he said, according to pool reports.

But Pence carefully hedged his remarks, clarifying that the US would “follow the facts” on Khashoggi’s death while arguing that the Trump administration wanted to find a way to preserve a “strong and historic partnership” with the kingdom.

Aside from the purported recording of Khashoggi’s agonizing final moments, US intelligence agencies reportedly based their conclusion on a transcript of a phone call between Khalid bin Salman, Mohammad’s brother and the kingdom’s ambassador to the US. During the call with Khashoggi, the CIA says, KbS assured the journalist that he wouldn’t be harmed if he visited the Istanbul consulate, where he would be able to retrieve paperwork needed to marry his Turkish fiance.

For what it’s worth, Khalid bin Salman denies that he ever instructed Khashoggi to visit the Saudi embassy in Istanbul.

As we told the Washington Post the last contact I had with Mr. Khashoggi was via text on Oct 26 2017. I never talked to him by phone and certainly never suggested he go to Turkey for any reason. I ask the US government to release any information regarding this claim.

— Khalid bin Salman خالد بن سلمان (@kbsalsaud) November 16, 2018

Looking ahead, we wait to see if Saudi Arabia will reward Trump with another 7% drop in the price of oil by coming out against another OPEC+ production cut.

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International media attention, an expansive search involving 18 nations and even the prayers of Argentine native Pope Francis weren’t enough to save the crew of the TR-1700 model submarine that disappeared off the coast of Patagonia almost exactly one year ago.

After seven desperate distress signals sent by the submarine’s doomed crew of 44 sailors failed to lead rescuers to its resting place, the Argentine government conceded that the crew had probably perished. But the search for their remains, and the investigation into what exactly went wrong, rattled the Argentine military, eventually leading to the dismissal of the head of the country’s navy and raids on federal offices.

But just two days after Argentine President Mauricio Macri held a ceremony honoring the families of the disappeared sailors, the Argentine has revealed that the sub has been located.

Hours before the Argentine government announced that the remains of the sub had been found, it tweeted a map of the suspected location.

#ARASanJuan #LaBúsquedaContinúa Actualización: La empresa informó nuevo punto de interés en el Sitio 1 área 15A-4, a 800 mts de profundidad. El punto de interés tiene una dimensión de 60 mts de longitud. Hora de arribo al área para iniciar investigación 19:00 hs aproximadamente. pic.twitter.com/l5k8p8Zjye

— Armada Argentina (@Armada_Arg) November 16, 2018

According to Reuters, the vessel was founded “imploded” 907 meters deep in waters off the Valdes Peninsula in Argentine Patagonia. There were no survivors. The navy said a “positive identification” had been made by a remote-operated submersible from the American ship Ocean Infinity, which was hired for the latest search for the missing vessel.

On Thursday, on the anniversary of the disappearance, President Mauricio Macri said the families of the submariners should not feel alone and delivered an “absolute and non-negotiable commitment” to find “the truth.”

Macri promised a full investigation after the submarine was lost. Federal police raided naval bases and other buildings last January as part of the probe, soon after the government dismissed the head of the navy.

The ARA San Juan was on its way back to its base in the coastal city of Mar del Plata when the Argentine Navy lost contact. In the year since its disappearance, investigators have determined that a mechanical failure likely led to an explosion that sunk the sub. The German-made vessel had been retrofitted a year before its disappearance, a meticulous process that could create serious vulnerabilities if safety precautions aren’t taken in meticulous detail.

Argentina gave up hope of finding survivors after an intense search aided by 18 countries, but the navy has continued searching for the vessel.

The German-built diesel-electric TR-1700 class submarine was commissioned in the mid-1980s and was most recently refitted between 2008 and 2014. During the $12 million retrofitting, the vessel was cut in half and had its engines and batteries replaced. Experts said refits can be difficult because they involve integrating systems produced by different manufacturers, and even the tiniest mistake during the cutting phase can put the safety of the ship and crew at risk.

The navy said previously the captain reported on Nov. 15 that water entered the snorkel and caused one of the sub’s batteries to short-circuit. The captain later communicated that it had been contained.

Some hours later, an explosion was detected near the time and place where the San Juan was last heard from. The navy said the blast could have been caused by a “concentration of hydrogen” triggered by the battery problem reported by the captain.

The discovery closes what has been a traumatic chapter in Argentina’s military history. But the investigations into who should bear responsibility are ongoing. Whether anybody is brought to justice for the errors that led to the deaths of so many sailors remains to be seen.

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Two days after NBC reported that in what would amount to a stunning foreign policy concession by the White House, the Trump Administration was contemplating extraditing Turkish president Erdogan’s nemesis, cleric Fethulah Gulen who has been living for decades in rural Pennsylvania, in order to placate Turkey over the murder of journalist Jamal Khashoggi, on Saturday Trump denied the report, rejecting that he is considering handing over Erdoğan’s foe.

Trump told reporters at the White House before leaving for a trip to California that extraditing exiled Turkish cleric Fethullah Gülen was “not under consideration.” Trump also said that “we’re having a very good moment with Turkey,” referring Erdogan’s release of American pastor Andrew Brunson last month, and said the U.S. is always looking for “whatever we can do for Turkey.”

On Thursday, NBC reported that the White House had directed the DOJ and FBI to find ways to extradite Gulen and that cooperation over the extradition was an attempt quell tensions between key US allies, Saudi Arabia and Turkey, over the killing of journalist Jamal Khashoggi inside the Saudi consulate in Istanbul last month.

Trump’s comment echoed that of DOJ spokeswoman Nicole Navas Oxman, who on Friday told Reuters that the DOJ “has not been involved in nor aware of any discussions” regarding Gülen’s extradition in an attempt to appease Turkey. State Department spokeswoman Heather Nauert also rejected the NBC News report on Thursday, saying, “The White House has not been involved in any discussions related to the extradition of Fethullah Gulen.”

Predictably, US national security and foreign policy experts had been stunned by the original report: “This is the Trump administration seeking to barter away a US resident who has lived here legally for years,” the former National Security Council senior director Ned Price told Business Insider, adding that such a move would be “seeking to skirt the rule of law.”

Then again, even if the NBC report wasn’t fake news, any extradition meant to ease tensions would have proven futile, because on Friday Turkey said any US attempt to suppress its investigation into the journalist Jamal Khashoggi’s death wouldn’t work.

Ankara, which has provided the news media with a steady drip of leaks from the Turkish investigation implicating Saudi leadership in Khashoggi’s death, has ruled out any sort of cooperation with the US to wind down its investigation.

“At no point did Turkey offer to hold back on the Khashoggi investigation in return for Fethullah Gulen’s extradition,” an unnamed senior Turkish official told Reuters on Friday. “We have no intention to intervene in the Khashoggi investigation in return for any political or legal favour.”

An unnamed Turkish official also told NBC News on Thursday that the government did not link its investigation into Khashoggi’s death with Gulen’s extradition case.

“We definitely see no connection between the two,” the official said. “We want to see action on the end of the United States in terms of the extradition of Gulen. And we’re going to continue our investigation on behalf of the Khashoggi case.”

And perhaps to confirm that there will be no silencing Turkey’s “probe” of the dissident journalist’s murder, on Friday a Turkish daily reported that the planning of Khashoggi’s execution was caught on audio.

The audio tape, allegedly in the possession of Turkish investigators, features a 15-minute conversation, in which “the Saudi team discusses how to execute Khashoggi,” the Turkish Hurriyet Daily wrote on Friday, citing its columnist Abdulkadir Selvi. In a recording that was allegedly made even before the journalist entered the Saudi consulate, “they are reviewing their plan, which was previously prepared, and reminding themselves of the duties of each member,” he said.

The Hurriyet report contradicted the statement made by the Saudi deputy public prosecutor, Shaalan al-Shaalan, who said that the team was actually sent to Istanbul to retrieve the journalist and bring him back to Saudi Arabia. A decision to murder the reporter –and outspoken critic of Riyadh– was allegedly taken by the head of the team after its ‘persuasion’ failed.

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Theresa May managed to get the draft Brexit agreement approved by her cabinet after five hours of discussion Wednesday night.

As Statista’s Martin Armstrong notes in the chart below, there is still an awfully long way to go though…

You will find more infographics at Statista

And there is still plenty of room for pessimism among Brexit experts.

You will find more infographics at Statista

Only 11 percent of the leading experts surveyed by The UK in a Changing Europe said they thought a withdrawal agreement would be signed by the end of November and 16 percent doubt that there will be a trade deal in place with the EU by the end of 2020.

While a majority still think a no deal Brexit is not likely, a nevertheless large share (42 percent) think it is a strong possibility.

Regardless of the kind of deal the UK ends up with, 70 percent foresee a fall in foreign investment from outside the EU due to Brexit.

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Pretty soon Baltic banks might find themselves effectively cut off from the global dollar system, regardless of how stringent their  money laundering controls or how spotless their compliance records.

Even banks with no exposure or involvement to Danske Bank’s Estonian branch – the nexus of an unprecedented global money-laundering scheme that went uninterrupted for years – could face collateral damage from the broadening scandal as international regulators look past Danske’s blatant disregard for European anti-money laundering controls and toward the international financial institutions that helped enable them by clearing their transactions: such as US and European megabanks.

International banks like JP Morgan and Deutsche Bank already got burned during the catastrophic banking scandal in Latvia that almost brought down the country’s financial system (the correspondent banks embarked on a wave of “de-risking” after staring down threats from regulators). Now, that scenario is playing out again, but on a much larger scale.

According to Bloomberg, the DOJ has contacted Deutsche Bank AG and Bank of America Corp. to request information about transactions they cleared for the Danish lender’s Estonia branch – the epicenter of what’s believed to be the largest money laundering scandal in European history.

In an internal audit, Danske said that nearly all of $230 billion in non-resident transactions processed by the bank between 2007 and 2015 are suspicious. Amazingly, Russian President Vladimir Putin has appeared in prosecutors’ documents, as investigators in the US and Europe believe that some of the money moved through the branch belonged to the Russian leader and members of his inner circle. Danske’s CEO and its chairman have been forced out over the scandal. And some investors worry that the fallout could cost Denmark its ‘AAA’ credit rating. 

The investigation is still in its infancy, and there are no signs yet as to whether the banks themselves are targets. But the SEC and DOJ are raising questions about whether the banks applied appropriate AML scrutiny to their correspondent businesses.

JPMorgan stopped providing correspondent services to the Danske Bank branch in 2013. Deutsche Bank and Bank of America continued for another two years, according to the reports and the people familiar with the matter. Deutsche Bank handled the bulk of these transactions during the period under scrutiny, one of the people said.

In the past, correspondent banks have been treated by US authorities as “unwitting dupes.” But setting aside the fact that the vast majority of Danske’s Estonian clients weren’t actually Estonian (the branch catered almost exclusively to non-residents from the CIS), it’s difficult to imagine how the massive sums flowing through the tiny branch, which dwarfed the GDP of Estonia, didn’t warrant a second look by the banks’ compliance staff. The only sensible explanation is that a degree of magical thinking – or willfull ignorance – was involved.

Also, JPM, BofA and Deutsche each decided to terminate their correspondent banking relationship with Danske – but at different times.

In June 2013, according to the Danske Bank internal investigation, a JPMorgan executive told a Danske Bank board member that it planned to terminate services for the Estonia branch because of its high percentage of nonresident clients, a potential sign of money laundering. When it did so two months later, another of Danske Bank’s correspondent banks – Bank of America – agreed to expand its dollar-clearing business with the branch, according to the internal report. It’s unclear whether Bank of America was aware of JPMorgan’s concerns.

Danske Bank conducted an “internal review” after Estonian investigators started investigating the Estonian branch in 2014. But while they noted certain irregularities (like the fact that a staggering 90% of the branch’s profits came from non-resident clients) they didn’t take any meaningful action to step up their AML controls.

Why? We’ll give you one guess:

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For two consecutive days US stocks surged on renewed hopes that trade tensions between the US and China may be thawing ahead of the upcoming G-20 meeting between presidents Trump and Xi, when first an FT suggested that USTR Lighthizer had said no further tariff raises would be forthcoming (the report has since been denied), and subsequently when Trump himself told reporters on Friday he may not impose more tariffs after China sent the United States a list of measures it was willing to take to resolve trade tensions.

Unfortunately for markets, and bulls such as JPM’s Marko Kolanovic who saw last week’s traces of trade de-escalation as a reason to quadruple-down on his recommendation to buy stocks, any hopes of an imminent trade war end or even ceasefire came crashing down overnight when Vice President Mike Pence traded sharp barbs with Chinese leader Xi Jinping in back-to-back speeches at the Asia Pacific Economic Co-operation (APEC) summit in Papua New Guinea, which confirmed yet again that neither country is willing to compromise in the escalating trade war.

Xi received applause Saturday when he told the Asia-Pacific Economic Cooperation summit in Papua New Guinea that implementing tariffs and breaking up supply chains was “short-sighted” and “doomed to failure.” According to Bloomberg, Xi called for a stronger World Trade Organization and defended his signature Belt-and-Road Initiative, saying it’s “not a trap as some people have labeled it.”

Speaking moments later, vice president Pence – who in recent weeks has been pushing an aggressive anti-China agenda – threw down the gauntlet to China on trade and security in the region, saying the US will not back down from its trade dispute with China, and might even double its tariffs, unless Beijing bows to U.S. demands: “we have taken decisive action to address our imbalance with China,” adding that “we put tariffs on $250 billion in Chinese goods, and we could more than double that number.”

“We’re in a very strong position,’’ Pence said when asked whether there was a deadline to end the trade war. “The American people know that we have to do something to reset this relationship with China economically. So, I don’t think there’s a timetable.”

Pence told delegates the U.S. offers countries in the region “a better option’’ for economic and diplomatic relations than Beijing’s heavy-handed approach.

In a pun on words on China’s “One Belt, One Road” initiative, Pence warned against taking Chinese loans, saying the U.S. “doesn’t drown our partners in a sea of debt” nor offer “a constricting belt or a one-way road.”

The United States deals openly and fairly – and we don’t offer a constricting belt or a one-way road. When you partner with us, we partner with you, and we all prosper. #APEC2018 pic.twitter.com/pjL9XM9Sz2

— Vice President Mike Pence (@VP) November 17, 2018

Technically he is right: the World Bank does that, and then the US-led IMF comes in to “bail them out” at terms that are preferential only to the creditors (see Greece, or any other nation “saved” by the IMF).

Do not accept foreign debt that could compromise your sovereignty. Protect your interests. Preserve your independence. And just like America, always put your country first. #APEC2018 pic.twitter.com/HUQjU7OQgY

— Vice President Mike Pence (@VP) November 17, 2018

“China has taken advantage of the United States for many years. Those days are over,” he told delegates gathered on a cruise liner docked in Port Moresby’s Fairfax Harbour.

He also took aim at China’s territorial ambitions in the Pacific and, particularly, Xi’s Belt and Road Initiative to expand land and sea links between Asia, Africa and Europe with billions of dollars in infrastructure investment. “We don’t offer constricting belts or a one-way road,” said Pence.

And then came the punchline: “The United States, though, will not change course until China changes its ways.” Later, Pence told reporters he was “very hopeful” the U.S. and China could reach a deal, but “things have to change” for that to happen.

Tensions between the two nations are likely to deteriorate even more after the US took aim at China’s territorial ambitions. While not referring directly to Chinese claims over various disputed waters in the region, Pence said the United States would work to help protect maritime rights and said that the US seeks to establish a military base in Papua New Guinea, aka China’s back yard.

“We will continue to fly and sail where ever international law allows and our interests demand. Harassment will only strengthen our resolve.”

Meanwhile, Xi gave no indication of giving in on any U.S. demands, including an end to technology transfer, support for state-run enterprises, and giving up on its Made in China 2025 plan to lead the world in key industries. He said intellectual property rights are important to protect innovation but they shouldn’t widen the digital gap between countries.

In a further provocation to the Trump Admin, Xi also made a veiled reference to a new grouping known as “the Quad” that aims to counter China’s influence in the Asia-Pacific. Consisting of the U.S., Japan, India and Australia, the group met in Singapore for the third time this week to discuss ways to cooperate. “Attempts to form exclusive blocs or impose one’s will on others should be rejected,” Xi said. “History has shown that confrontation, whether in the form of a cold war, a hot war or a trade war, will produce no winners.”

Finally, Xi said talks would only work if both sides treated each other with respect: “If countries can only treat each other equally and understand each other,” he said, “there will be no issues that can’t be settled by negotiation.”

The only problem is that there has been virtually no mutual response, no compromises and no true negotiation.

Pence’s Saturday warning contrasted with remarks made by Trump on Friday, which were interpreted by the market as a tentative olive branch to China and a step to defuse tensions.  Trump, who did not attend the APEC meeting and is due to meet Chinese President Xi Jinping at a G-20 summit in Argentina – told reporters Friday that the Chinese response to U.S. trade demands was largely complete but was missing four or five big issues. Those comments helped U.S. stocks erase losses, and sent the Dow Jones surging 200 points higher.

The bottom line: since there was no hint of a compromise from either Pence or Xi – in fact, quite the opposite as both sides retrench – any hopes for a thaw in relations were summarily crushed. And, as Reuters warns, Pence’s stark warnings will “be unwelcome news to financial markets which had hoped for a thaw in the Sino-U.S. dispute and perhaps even some sort of deal at a G20 meeting later this month in Argentina.”

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Via The Strategic Culture Foundation,

“Insulting” – that’s how US President Donald Trump sharply reacted to the idea of a “real European army” proposed by French President Emmanuel Macron.

And it was how Macron rationalized the need for an independent military force for Europe that perhaps most irked the American leader.

Speaking on a tour of World War I battlefields in northern France last week, Macron said that Europe needed to defend itself from “China, Russia and even the United States of America”.

It was a pretty extraordinary choice of words by the French leader. To frame the US among an array of perceived foreign enemy powers was a devastating blow to the concept of a much-vaunted transatlantic alliance.

Since the Second World War, ending 1945, the concept of an American-European alliance has been the bedrock of a supposed inviolable, mutual defense pact. That nearly seven-decade alliance is now being questioned more than ever.

Macron’s call for a European army was further backed up by German Chancellor Angel Merkel who also pointedly said this week that Europe can no longer rely on the US for its defense.

Russia’s President Vladimir Putin has welcomed the proposal for Europe to form its own military organization, independent from Washington. No doubt, Moscow views such a development as augmenting a move towards a multipolar international order, which Russia and China, among others, have been advocating in opposition to American ambitions of unipolar dominance.

When Trump arrived in Paris last weekend along with dozens of other world leaders, including Putin, to commemorate the centennial anniversary marking the end of World War I, there was a notable frostiness between Macron and the American president. Only a few months ago, Macron and Trump had appeared the best of friends in what some observers referred to as a “bromance”.

During the Paris events, Macron sought to placate Trump by saying that the European army proposal would have a “complementary” role to the US-led NATO military alliance. However, their relationship further soured when Macron later delivered a speech in which he made a veiled rebuke of Trump’s “nationalist” politics.

Days later, on returning to Washington, Trump then fired off a fusillade of angry tweets attacking Macron in very personal terms over a range of issues, including “unfair” economic trade and France’s alleged ungrateful attitude towards the US liberation of Paris from Nazi Germany during the Second World War.

The rift between the US and Europe has been brewing even before Trump’s presidency. For years, Washington has been carping that the Europeans need to spend more on military defense, claiming that the US has been shouldering the burden for too long. Trump has taken the griping to a new, higher level. Recall that he has threatened to pull out of NATO because the Europeans were “free loading” on American “protection”.

The irony is that now the French and German leaders are talking about setting up their own military defenses, Trump has blown a fuse.

Evidently, the American contention is not about “burden sharing” of defense. If Washington was genuinely aggrieved about supposedly defending Europe at too much of its own expense, then Trump, one would think, would be only too glad to hear that the Europeans were at last making their own military arrangements, and taking the burden off Washington.

This gets to the heart of the matter about the real purpose of NATO and presence of tens of thousands of US troops stationed in bases across Europe since 1945. American military presence in Europe is not about “protecting” its supposed allies. It is, and always has been, about projecting American power over Europe. In reality, American troops and bases in Europe are more functioning as an occupying force, keeping the Europeans in line with Washington’s strategic objectives of hegemony over the continent.

Macron and Merkel’s vision of a European army is probably fanciful anyway, without any real prospect of materializing. How such a new defense arrangement would work independently from the 29-member NATO alliance led by the US seems unwieldy and impractical.

But the latest tensions between Washington and European leaders over military organization demonstrate the real nature of America’s relationship to Europe. It is about domination by Washington over Europe and has little to do with partnership and protection.

When Trump and previous US presidents have urged greater military spending by Europe the ulterior agenda is for Europeans to pay more to underpin American military presence, not for Europeans to find their own independent defense arrangement.

Tensions in the transatlantic axis seem to be coming to a head, heightened by Trump’s nationalistic “America First” policy. Rivalries are sharpening over trade, US sanctions on Iran, Trump’s threats against European energy plans with Russia, the Paris Climate Accord, and squabbling over NATO expenditures.

There is nothing progressive about Macron or Merkel’s call for a European army. It is more to do with France and Germany wanting to assert themselves as great powers and to shake off American tutelage out of frustration with Trump’s domineering petulance.

Only last week, Macron caused controversy when he praised French military general Philippe Pétain who collaborated with Nazi Germany as leader of Vichy France (1940-44). Macron wants a European army to satisfy his own nationalistic ambitions of revamping French global power. This week, he spent the night onboard a refurbished French aircraft carrier, the Charles de Gaulle, from which he gave a media interview saying that being “an ally of America meant not being a vassal”. Touché!

A progressive challenge from Europe to American power would not involve setting up a new army. Instead it would involve Europeans pushing for the disbandment of NATO as an obsolete organization and for the withdrawal of US-led forces which are dangerously amassing on Russia’s border.

Nonetheless, the one positive thing to emerge from the transatlantic spat over military defenses is that it illustrates more than ever how European protection is not the real purpose of Washington’s relationship to the continent. The purpose is one of using Europe as a platform for projecting America’s power, in particular against Russia.

The recent announcement by the Trump administration that it is willing to rip up yet another nuclear arms control treaty – the INF following the ABM in 2002 – clearly shows that Washington, ultimately, has recklessly scant concern for Europe’s security with regard to a possible future war with Russia.

For Washington, despite all the chivalrous rhetoric, Europe is not a partner nor even an ally. It is a vassal. Admittedly, thousands of American troops died while bravely fighting wars in Europe. But they are distinct from the US ruling class. At bottom, Europe is merely a battlefield for American military power, just as it was in two previous world wars. One hundred years after the end of World War I, the same callous calculus for the imperial planners in Washington is at play.

European ideas for independent defense is why Washington has reacted so furiously. It’s not willing to give up its European front.

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If the European Commission does levy billions of fines against the Italian government (or enforce some other punishment), some “60 million Italians will rise up” against the trade bloc – or at least that’s what a clearly frustrated Deputy Prime Minister Matteo Salvini told a group of Italian reporters following reports that the Commission could move to punish Italy as soon as next week.

The Italian people, Salvini added, would never accept those penalties, according to a report in Italy’s ANSA newswire. And according to the latest polling, there’s more than a little truth to that.

As the 27 EU members who aren’t the UK brace for the inevitable fallout for what increasingly looks to be a bumpy Brexit, one shocking poll revealed that 60% of Italians feel that their country has been mistreated by the European Union. If accurate, that’s several percentage points higher than the percentage of Britons who voted to leave the EU back in 2016.

According to Express, pollsters Coldiretti and Ixè found that some 43% of Italians believe that Brussels’ economic policies were designed by stronger economies with little concern for weaker EU members. And fittingly enough, one of Italians’ biggest concerns about the EU and its unfair treatment of Italy stems from policies related to agriculture.

Two-thirds of Italians believe that the EU’s policies on food damage products made in Italy and only 10 percent believe the Italian agri-food sector is benefitting from EU choices.

A spokesperson for Coldiretti said: “The clear majority of Italians therefore believe that community regulation and the recent choices regarding international treaties are not adequate to guarantee quality, safety but also respect for the gastronomical traditions of Italy.”

But the dissatisfaction runs deeper than food.

Italians expressed their frustration with Europe when they voted for the League and Five Star Movement during the March elections. That vote, and the rising popularity enjoyed by both parties, represented what many believed to be a clear mandate: To shake up a relationship with Brussels that was no longer working for Italians.

Italy, Index poll:

LEGA-ENF: 33%
M5S-EFDD: 26%
PD-S&D: 18%
FI-EPP: 7%
FdI-ECR: 4%
LeU-S&D: 3%
+E-ALDE: 2%

Field work: unrevealed
Sample size: unrevealed pic.twitter.com/BRfxPorzk9

— Europe Elects (@EuropeElects) November 16, 2018

On Thursday, Deputy Prime Minister Luigi Di Maio told reporters in Rome that the EU is asking Italy “for a blood and tears budget,” according to Bloomberg.

“It is unbelievable that they don’t understand our reality.”

But the intensity of Italians’ anger toward the EU has apparently been lost on the European Commission. In comments that sounded lie they were meant to aggravate the situation, EC Vice President Valdis Dombrovskis warned in an interview with an Italian paper that Italy had defied the EU with its irresponsible fiscal policies, and threatened to sanction the country for its reckless spending. 

Meanwhile, Italy’s leaders have insisted that abandoning plans for fiscal stimulus would be like committing “suicide.”

Disillusionment is particularly high among young Italians, who still struggle with high unemployment and other social ills. Support for leaving the bloc is much higher among young Italians when compared with young Europeans in general.

Interestingly, Italy’s GDP growth had kept pace with Germany’s until the 2011 eurozone crisis.

And as Albert Edwards explains, the EU’s budget rules have consistently seen Italy run a budget surplus, keeping fiscal conditions tighter than they would otherwise be (the growth in Italian debt actually slowed after it joined the euro). Edwards compared these rules to a “fiscal straightjacket.”

Which goes back full circle to the austerity being imposed upon Italy by the EU: it is this fiscal straitjacket that the Italian government has been forced to wear over the last decade that has become intolerable to the Italian electorate (see chart below showing persistent large primary surpluses) according to Edwards, who notes that “it was only a matter of time before they broke free, but to be honest I am surprised it has taken so long for this confrontation with the EC to occur.”

The degree to which this tightening has occurred can be seen in cyclically adjusted government spending, which suggests that the country’s fiscal impulse has actually weakened since Italy joined the eurozone. 

All of this certainly supports Edwards’ expectation that if the contemporary populist regime doesn’t take Italy out of the eurozone, the next crisis will yield a government that is even more fanatically opposed to the bloc’s policies. In other words, it’s not so much a question of ‘if’, but ‘when’.

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