Soros captures the risk that markets can’t

George Soros via Foreign Policy:

The refugee crisis was already leading to the slow disintegration of the European Union. Then, on June 23, it contributed to an even greater calamity — Brexit. Both of these crises have reinforced xenophobic, nationalist movements across the continent. They will try to win a series of key votes in the coming year — including national elections in France, the Netherlands, and Germany in 2017, a referendum in Hungary on EU refugee policy on Oct. 2, a rerun of the Austrian presidential election on the same day, and a constitutional referendum in Italy in October or November of this year.

Rather than uniting to resist this threat, EU member states have become increasingly unwilling to cooperate with one another. They pursue self-serving, discordant migration policies, often to the detriment of their neighbors. In these circumstances, a comprehensive and coherent European asylum policy is not possible in the short term, despite the efforts of the EU’s governing body, the European Commission. The trust needed for cooperation is lacking. It will have to be rebuilt through a long and laborious process.

…The current piecemeal response to the crisis, culminating in the agreement between the EU and Turkey to stem refugee flows from the Eastern Mediterranean, suffers from four fundamental flaws. First, it is not truly European; the agreement with Turkey was negotiated and imposed on Europe by German Chancellor Angela Merkel. Second, the overall response is severely underfunded. Third, it has transformed Greece into a de facto holding pen with inadequate facilities. Finally, it is not voluntary: It is trying to impose quotas that many member states strenuously oppose and requires refugees to take up residence in countries where they are not welcome and where they do not want to go while returning to Turkey others who reached Europe by irregular means.

And the fix:

 …First, the EU and the rest of the world must take in a substantial number of refugees directly from front-line countries in a secure and orderly manner, which would be far more acceptable to the public than the current disorder. If the EU made a commitment to admit even just 300,000 refugees each year, and if that commitment were matched by countries elsewhere in the world, most genuine asylum-seekers would calculate that their odds of reaching their destination are good enough for them not to seek to reach Europe illegally, since that would disqualify them from being legally admitted. If, on top of this, conditions in front-line countries improved thanks to greater aid, there would be no refugee crisis. But the problem of economic migrants would remain.

This brings us to the second point: The EU must regain control of its borders. There is little that alienates and scares publics more than scenes of chaos…The immediate remedy is simple: provide Greece and Italy with sufficient funds to care for asylum-seekers, order navies to make search-and-rescue missions (and not “protection” of borders) their priority, and implement the promise to relocate 60,000 asylum-seekers from Greece and Italy to other EU member states.

Third, the EU needs to develop financial tools that can provide sufficient funds for the long-term challenges it faces and not limp from episode to episode…At least 30 billion euros a year will be needed for the EU to carry out a comprehensive asylum plan.

Fourth, the crisis must be used to build common European mechanisms for protecting borders, determining asylum claims, and relocating refugees. Some modest progress is underway: Legislation establishing a European Border and Coast Guard was adopted this month by the European Parliament. But the Dublin III Regulation — the basis of determining which country bears responsibility for processing and hosting asylum-seekers — prevents solidarity among EU member states by putting most of the burden on the country of first entrance; it needs to be renegotiated.

Fifth, once refugees have been recognized, there needs to be a mechanism for relocating them within Europe in an agreed way. I

…Sixth, the European Union, together with the international community, must support foreign refugee-hosting countries far more generously than it currently does. The required support is in part financial, so that countries such as Jordan can provide adequate schooling, housing, training, and health care to refugees, and partly in the form of trade preferences, so that these countries can provide employment both to refugees and to their own populations

The seventh and final pillar is that, given its aging population, Europe must eventually create an environment in which economic migration is welcome. Merkel opened Germany’s doors wide to refugees, but her generous act was not well thought through; it ignored the pull factor. A sudden influx of more than a million asylum-seekers overwhelmed the capacity of the authorities, turning public opinion against migrants. Now the EU urgently needs to limit the overall inflow of newcomers, and it can do so only by discriminating against economic migrants.

And that small challenge, my friends, is why a politically dysfunctional Europe is in so much trouble and why our George is long gold.

David Llewellyn-Smith
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