Trump’s shock victory has sparked Europe’s Age of Anxiety

For Europe, almost as much as for America, the election of Donald Trump is a turning point. From now on, anything can happen. 

Across the continent, the Far-Right has been galvanised. Marine Le Pen now knows that Outsiders are the new Insiders and that it is genuinely possible that she will be elected the next President of France. Angela Merkel will be fearful that her own reign as the Chancellor of Germany could end next autumn as voters demand a Germany-first approach to both immigration and the European Union.

Brussels will be convulsed. The ease and relative certainty with which the Commission dealt with Washington is gone. Unless the President-elect turns out to be talking through his Make America Great Again hat, the emphasis of U.S. negotiators will be on resetting the clock and starting over, on trade, foreign policy and mutual defence. 

The proposed Transatlantic Trade and Investment Partnership (TTIP) that has already proved problematic on both sides of the Atlantic, will now, we are told, be repudiated by the Trump Administration, which – as with the stalled Trans-Pacific Partnership – will try to renegotiate virtually the entire document in favour of America and American workers.

Will there be a trade war with Europe? That might be an over-dramatisation of what will happen. Wiser and cooler heads tend to prevail in talks that are bound to stretch over months if not years. But Donald Trump has promised America that it is ground zero for trade deals and that in future, while he promises to be “fair” to the rest of the world, his number one priority is the USA

This morning, the dollar tumbled as news of Trump’s victory broke. How long will that last? The Japanese Yen will surely not become the new go-to currency, and the Renminbi is a work-in-progress. Where to look, then, for safety? With sterling tumbling in space, having been ejected from the global airlock in the wake of the Brexit vote, and with the euro still in intensive care after eight years in surgery, no currency looks safe anymore. Gold – as valued now as it was in the days of the Pharaohs – will be the immediate recourse of investors around the globe, unsure of how the currency chips will fall. Ultimately, however, not even gold is worth its weight in gold. What it is is a measure of uncertainty, and central bankers will be hoping that the markets will settle down in the days ahead and that the Fed, looking ahead to an America-First strategy, can somehow re-emerge as the essential guarantor of economic stability. 

For the EU, far beyond issues of the euro v the dollar, the harbingers are not good. If Trump can win in Washington and Brexit in Britain, why should Marine Le Pen not force her way into the Elysée next May, thus taking France into a conflict with Brussels that could bring its entire house of cards tumbling down? Without France, the EU would be nothing. The Eurozone would be the first to go.  Germany would immediately seek to cut its losses and resurrect the Deutschemark; Italy would not be far behind, bringing back the lire so that, in theory at least, everyone becomes once more a millionaire. The Schengen Agreement would be next to go. There would be a sink-hole where the single market used to be. The Commission itself, and the Council, and the Parliament would come tumbling down. 

None of these things have to happen. America’s New Order does not have to become the New World Order. There are still sensible, level-headed people in positions of power and influence in America and Europe. But the chances of an EU implosion have, as of today, been significantly increased. All it needs is for the Front National to take over in France and the game is up.

As things stand, the smart money is on a Conservative candidate winning in the second round of French voting, meaning, most likely, a President Juppé or a President Sarkozy. But smart money is a worthless currency these days. It wouldn’t buy you a cup of tea and a sandwich. Who knows who will take over from the hapless François Hollande? Who knows what rough beast is slouching towards Berlin to be born? At risk of quoting Michael Gove,  don’t let the experts fool you. Nobody knows what is going to happen in the age of madness that is now upon us. In the 21st century, it is the people who decide, not the leaders, and the people of the world, it seems, are mad as hell and aren’t going to take it anymore.