Cables From The Diplomatic Frontlines - Munich Security Conference sees Europe shed its pollyanna beliefs.

Europe-wide consensus on military revival: implications and second-order effects.

• This year’s Munich Security Conference saw a different Europe emerge from the war in Ukraine.

• Just a year ago, it was mainly the UK and Poland/Baltic States that were raising the alarm over Ukraine’s impending invasion.

• Major European powers were nowhere near pursuing adequate measures in the face of the Kremlin’s imminent attack on the largest country in Europe.

• Germany was busy embarrassing itself by sending over 5,000 helmets, and France was still in disbelief that Russia could really do “such a stupid thing” - and Macron was busy shuttling to an from Kremlin, engaging in some last minute ‘‘diplomacy’’ with Putin, and using the crisis to burnish his foreign policy prestige and impact ahead of the Presidential elections in April of 2022 (though to be fair to Macron, all competent politicians would pull off this move).

• Indeed, this disbelief was pervasive across the entire governing establishment of both France and Germany, and the French even took to extreme cynicism and complained that the UK was deliberately amping up the tensions to come out as the leader of Europe’s eastern bloc (which is not an entirely false claim - but then again, two things can be simultaneously true: UK genuinely raising alarm, and trying to capitalize on the situation and come out as the leader).

• (side note: the French head of military intelligence was later fired for the failure to predict the Russian invasion. Although, given the views of political leaders at the time, it is unclear how much latitude he was given to speak his true mind, and do this forcefully.)

• All this is not to say that continental European powers have sobered 100% - for many months after the invasion, we still witnessed unreasonable calls and pressure on Kyiv to hold extremely premature negotiations with the Kremlin…Something that could only benefit Russia - by either: a) freezing their current gains and providing an optionality to resume the invasion at a later, more opportune time, or b) ending the conflict with at least some territorial concessions made by Ukraine - rewarding an invader/aggressor, setting a terrible precedent for China, and confirming the perception of the “Global South” countries that the West lacks staying power.

• But a change in attitude did come after all: we now see Germany send over its Leopard II tanks, France 1/3rd of it Caesar Howitzers, and Italy providing its highly effective SAMP/T air defense systems.

• (side note: and the arguments these days are over who got to have dinner with Zelensky, and who failed to secure an invite. Naturally, it is more serious than that - but you get the point: it is about leadership and public roles played in defense of Ukraine)

• And these changes in attitude were further confirmed at this year’s Munich Security Conference (MSC).

• German Chancellor Olaf Scholz, (following immediately after Zelensky’s speech) called on Europe to develop a “high-performing arms industry”- to focus on Europe’s defense needs: “We need a permanent production of the most important weapons we are using.. [with European countries] all work[ing] in the same direction.”

• The French President Macron parroted the sentiments - calling Europeans to ‘‘invest more in defense”, and warned that the desire for peace must be matched by capabilities: “we need the means to achieve it…Production capacities need to be ramped up," adding that there would be no peace in Europe until the “Russian matter has been solved.”

• This is notable - the French President’s previously empty calls for ‘‘strategic autonomy’’ have evolved into appeals for concrete actions to boost defense capabilities.

• This is good for Europe, for Ukraine (which will now have a more capable ally - supplying ammo and equipment that Kyiv needs), and for the US.

• But if Europe was to in fact follow through on this rhetoric, and if it actually did invest into a strong military-industrial base, then there would be additional implications and second-order effects that are worth unpacking.

Part I: A new partner in competition for rare earths.