Bershidsky on Europe: Le Pen Rising in France

Here's today's look at some of the top stories on markets and politics in Europe.

Here's today's look at some of the top stories on markets and politics in Europe.

Russia takes over Ukrainian bases in the Crimea.

On Friday, Russian troops started taking over Ukraine's military bases in the Crimea, now officially recognized by the parliament in Moscow as part of Russia. By Monday, almost all of them were already in Russian hands, still without casualties or any serious fighting. Russian troops simply crashed through the gates in their armored personnel carriers and displaced the Ukrainian solders. In a few instances, stun grenades were used. One naval aviation base was taken over by unarmed locals, and all the Ukrainian military personnel did was sing the national anthem and leave. Ukrainian commanders in the Crimea say they never received any orders from Kiev, which the defense ministry in the Ukrainian capital denies, saying every unit had specific orders. Ukraine had a numerically strong presence in the Crimea, -- 22,000 personnel, according to Russian President Vladimir Putin -- but the soldiers had no inclination to fight Russians or the local militias, perhaps because they still see Russians as brothers rather than an enemy occupying force. The bloodlessness of the Russian takeover is already a matter of pride for Putin, and he will use it again and again to make the West accept the annexation of the Crimea.

U.S. steps up intelligence efforts in Russia, Ukraine and the Baltics.

According to The Wall Street Journal, U.S. intelligence detected Russian troop movements close to the Crimea last month, but it did not intercept any Russian communications in which plans to invade might have been discussed. The U.S. surveillance efforts, at the center of last year's biggest political scandals after the revelations of National Security Agency leaker Edward Snowden, are herculean in scale, but in the case of the Crimea they turned out to be futile. While the U.S. concentrated on troop movements on Russian soil, the Kremlin mostly used units already in the Crimea to perform the annexation. This, in the opinion of U.S. intelligence officials, calls for more spying in the former Soviet Union, including Russia, Ukraine and the Baltic States. The U.S. intelligence services have now "gone into crisis-response mode," The Wall Street Journal reports, citing a senior U.S. official. The crisis, however, may have begun months ago when Snowden fled to Russia, where he still resides. The Kremlin may now know as much about U.S. intelligence methods as the Americans do themselves.

National Front excels in French local elections.

Marine Le Pen's extreme right National Front won at least one mayoral seat in Sunday's municipal elections and greatly increased its representation in city councils. The first National Front mayor since 1995 will run Henin-Beaumont in northern France, and the party's candidates have strong leads before run-off votes in Avignon and Perpignan in the south, either of which, if won, would be the biggest town the National Front has run since Toulon in the 1990's. In total, run-off elections in up to 15 cities may also result in victories for Le Pen's party. The center-right UMP of former president Nicolas Sarkozy has also made gains. The President Francois Hollande's socialists have suffered a worse defeat than they expected. The anti-immigrant, some would even say neo-Nazi National Front is emerging as a third force to be reckoned with in France. Since neither of the mainstream parties wants to end up in a coalition with the far right, both will have to redouble their efforts to plunge it back into obscurity. That's no easy task and the charismatic Le Pen is betting heavily on a 2017 presidential bid.

Turkish president attacks Twitter ban.

Turkish President Abdullah Gul attacked the ban imposed on Twitter by the local telecom regulator on orders of Prime Minister Recep Tayyip Erdogan. It is "not legally possible to shut down the internet and platforms," Gul said. He also noted that the number of tweets coming from Turkey increased since the ban: It should be obvious to anyone who knows anything about technology that the comprehensive blockage of a web service is no easy technical task. Gul is a long-time Erdogan ally and his public opposition to Erdogan's ban (the premier believes Twitter, Facebook and YouTube are all evil because "there are all kinds of lies there") may be part of a good cop-bad cop routine, or it could be a sign of fractures at the top of the ruling Justice and Development party, ripped by internal strife since Erdogan's split with emigre cleric Fethullah Gulen spilled out into the open last year.

European governments take advantage of easy cash.

Eurozone governments have already raised 29 percent of their 2014 funding requirements, more than in any year since 2010, according to calculations by Barclays. Portugal, still in an international bailout, has raised 50 percent of the funding it needs for 2014. Eurozone sovereigns are selling longer-term debt than before: The average duration of a 2014 bond issue is 8.7 years, up from 7.4 years in 2013. The euro area governments are rushing to take advantage of incredibly low interest rates: Their borrowing costs have dropped faster than the yields on U.S. Treasuries and U.K. Gilts. Europe is now seen as a safe haven from the turmoil in emerging markets, thrown off balance by dramatic events such as Russia's annexation of the Crimea, and generally turbulent since last year's currency crisis. Meanwhile, lending to the governments on the euro area periphery is no less risky than last year or the year before. There have been some economic improvements, but the southern European countries' debt burdens are still extreme, and the recovery remains feeble. That, however, does not mean the governments themselves should not try to profit from being the best of the worst.

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