May 142015
 
 May 14, 2015  Posted by at 9:58 pm Finance Tagged with: , , , , , ,


Harris&Ewing Washington Monument, view from air 1919

I know I’ve talked about this before, but it just keeps coming and it keeps being crzay. Bloomberg ‘reports’ that the ‘German Finance Ministry’, let me get this right, “is supporting the idea of a vote by Greek citizens to either accept the economic reforms being sought by creditors to receive a payout from the country’s bailout program or ultimately opt to leave the euro.” And that’s it.

They ‘report’ this as if it has some sort of actual value, as if it’s a real thing. Whereas in reality, it has the exact same value as Greek Finance Minister Varoufakis suggesting a referendum in Germany. Or Washington, for that matter. Something that Bloomberg wouldn’t even dream of ‘reporting’ in any kind of serious way, though the political value would be identical.

Apparently there is some kind of consensus in the international press – Bloomberg was by no means the only ‘news service’ that ‘reported’ this – that Germany has obtained the right to meddle in the internal politics of other eurozone member nations. And let’s get this one thing very clear: it has not.

No more than the Greek government has somehow acquired the right to even vent its opinions on German domestic issues. It is a no-go area for all European Union countries. More than that, it’s no-go for all nations in the world, and certainly in cases where governments have been democratically elected.

So why do Bloomberg and Reuters and all the others disregard such simple principles? All I can think is they entirely lost track of reality, and they live in a world where reality is what they say it is.

Now, I know that Schäuble ‘merely’ said – I quote Bloomberg -: “If the Greek government thinks it should hold a referendum, it should hold a referendum.. Maybe it would even be the right measure to let the Greek people decide whether they’re ready to accept what needs to be done.”

That’s admittedly not the same thing that Bloomberg makes of it, though it’s possible that the ‘reporter’ got some additional background information from the German Finance Ministry, and that that’s the reason the ministry gets mentioned, instead of just Schäuble.

But that still doesn’t make it alright by any stretch of the imagination. The EU, and the eurozone, are made up of sovereign nations. Who function in a system of equal partners, certainly from a political point of view. So the German FinMin has no business even talking about a Greek referendum, no more than the Greeks have talking about a German referendums. And Angela Merkel should be on his case for this. But she’s not. At least not in public.

Whether or not Greece has a referendum -about the euro or anything else- is up to the Greek people, and first of all to the government they elected only 3.5 months ago. It has absolutely nothing to do with whoever is in charge in Berlin, or Paris, or even in the EU headquarters in Brussels. It’s a fatal mistake to think otherwise. Bloomberg has made that fatal mistake. Schäuble has come so close Athens should file a complaint against him.

Granted, all parties involved may be influenced by what happened 4 years ago -more Bloomberg-:

Schaeuble’s stance on a Greek plebiscite is a departure from Germany’s position in 2011. Back then, Prime Minister George Papandreou dropped his plan for a referendum after Chancellor Angela Merkel and French President Nicolas Sarkozy urged him not to hold the vote.

That referendum involved a haircut on Greek debt ‘negotiated’ by the troika, which Papandreou wanted the Greek people to vote on. And Merkel and Sarkozy did much more than ‘urge’ Papandreou not to hold the vote. They were afraid it would drive Greece from the eurozone, and scared the sh*t out of him so much he withdrew the plan a few days after proposing it.

Which is just another case of Euro nations meddling in the internal affairs of a fellow member nation. Something for which there wasn’t then, and still isn’t now, any political or legal support or framework inside the EU. Still, Brussels, Berlin and Paris applied similar pressure on Italy PM Berlusconi in those days, and installed – helped install – a technocrat PM, Mario Monti. In Greece, they got Papademos. Both Papandreou and Berlusconi were gone soon after the ‘pressure’ was applied.

That’s how Europe operates. And they have no legal right to do it. But that you won’t read at Bloomberg. The whole thing is so accepted that not even Syriza tells the Germans – or Bloomberg for that matter – to shut their traps. Even though they would have a lot more right to do that than Schäuble has to comment on internal Greek affairs.

And from where I’m sitting that means that Ashoka Mody’s piece for Bruegel is too little too late. Nice try but..

Europe’s Integration Overdrive

The problems will worsen in Greece and, will inevitably, arise elsewhere. The economic and political costs of breaking the Eurozone are so horrendous that the imperfect monetary union will be held together. Instead, the cost of the ill-judged rush to the euro and mismanagement of Greece will eventually be a substantial forgiveness of Greek debt.

But this is a good moment to step back and loosen European ties. As Schuman said, “Europe will not be built according to one plan.” The task is to create a de facto solidarity—not to force a fragile embrace. A new architecture should scale back the corrosive power relationships of centralized economic surveillance. Let nations manage their affairs according to their priorities.

And put on notice private creditors that they will bear losses for reckless lending. The European fabric -held together by commercial ties- is fraying as European businesses seek faster growing markets elsewhere. That fabric could tear if political discord and economic woes persist. History and Schuman will be watching.

Things have moved way beyond where Mody thinks they are at present. The secret ingredient is simply the crisis. The way the eurozone was hastily slapped together allows only for good times. The idea was that as long as things go well, nobody would notice the cracks. But Europe has been nothing but cracks for 7 years now, and there’s no end in sight.

The Greek people can vote all they want to end the misery Europe has inflicted on them, it doesn’t matter to the major powers in the union. They simply blame it all on the same Greeks, and judging from how Bloomberg approaches the issue, they have the upper hand. They live above their means, they’re wasteful and they’re lazy. That’s the portrait painted, and that’s how 90% of the world therefore sees them.

It makes no difference whether it is true or not. It’s all just about who has more money and power and press; they get to decide what people think about other people.

Does the euro have a future? If it does, it won’t look anything like it does today. The eurozone has only ever been a mechanism to make more money flow from the south to the north. And now the north will have to come up with a measure of solidarity, of being an actual union, and they bluntly refuse.

Rich European countries are all led by politicians who want to win their next elections. And these are national elections, not European elections. Those hardly matter. Because Europe is made up of sovereign nations. And that’s why the European Union in its present shape is doomed to fail.

Brussels will always clamor for a closer union, politically, fiscally, economically. But the way Germany et al has treated Greece and Italy and Spain over the past 7 years makes abundantly clear that such a close union will never come to fruition. These are all countries that are proudly independent, that commemorate battles from hundreds of years ago where their ancestors shed the blood and gave the lives that made them independent.

They’re not going to let Germany and France and Holland call the shots in their economies and countries now. Not a chance.

Europe only has a -peaceful- future as a continent of independent nations that work together where they can. To get there, they will need to abolish the euro and completely redo the union project, from scratch, close down all offices in Brussels, and they will have to do it soon, or there will be no peace.

Meanwhile, what’s left for Greece in Brussels that is beneficial to the country? I don’t see it. It makes me think more of a Stockholm syndrome by the hour. Get out, get your own currency, negotiate a treaty with Italy and Spain, maybe France. But don’t stay in a ‘union’ with outsiders who think they can tell you, Greeks, how to run a democracy, or when to hold a referendum. That can only be a road to nowhere.

Home Forums Why Not Tell Greece How To Run A Democracy?

This topic contains 13 replies, has 7 voices, and was last updated by  Formerly T-Bear 4 years, 4 months ago.

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  • #21069

    Harris&Ewing Washington Monument, view from air 1919 I know I’ve talked about this before, but it just keeps coming and it keeps being crzay. Bloomber
    [See the full post at: Why Not Tell Greece How To Run A Democracy?]

    #21070

    polistra
    Participant

    Well said. Greece has plenty of potential in basic economic terms. It produces more electricity and petroleum than it needs, so it doesn’t need a Sugar Daddy for the essentials.

    The numbers show the problem: Only 15% of the economy is industrial, and the hydropower potential is relatively untapped.

    Greece has fallen into the habit of being a tourist destination instead of Making Things.

    When you rely on tourists, you have to be nice to other countries. When you Make Things, other countries have to be nice to you.

    #21071

    Anonymous

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    #21085

    Dr. Diablo
    Participant

    It’s the fashion of the day: “Do what I tell you because I’m right!” (and you’re stupid). And if that doesn’t work, then “Do what I tell you because I have the power and will destroy you.” You all may know this better as “Submit or Die” i.e violent tyranny.

    Being more generous, what has happened is, like so many ideas, particularly Utopian ones, the Idea, the Dream has now taken on more importance than Reality to a group of believers. (Invasion of the Memes?) So it becomes fully justified to destroy reality–real things, real countries, real people; to rob, oppress, murder by thousands–because those people are inconveniently getting in the way of your Idea, a fantasy you read about once and lives only in your mind. If only they would obey, I wouldn’t have to kill them, but they are irrational. They are, not me. They are the ones making me violent, not me. They are the reason things aren’t going well, not that my idea is a steaming load of bunkum. We all do this to some extent, but most don’t turn it into a psychopathic pathology. Governments do.

    However, the history of enforcing Utopian ideals is a bad one: Communism, a wonderful idea of sharing and support and equality was responsible for a possible 85-100M deaths since 1850. https://en.wikipedia.org/wiki/Mass_killings_under_Communist_regimes This is true of many ideas–mostly idealistic, utopian ones, often religions, but the arc of the communist ideal is the most true to form and relevant today.

    Since the EU has already killed tens of thousands through unnecessary poverty, suicide, and crime, and has dramatically escalated the police vs. the people (as seen in the recent ECB HQ riots in Frankfort, but also with training and weapons in Spain, Germany) how many thousands or millions will the EU kill before they re-adjust their idea to better suit reality? It doesn’t have to stop; they can have WW4 and demolish Europe again. That is an option.

    “”The reasonable man adapts himself to the conditions that surround him… The unreasonable man adapts surrounding conditions to himself. [Thus] All progress depends on the unreasonable man.” –Geo. Bernard Shaw

    What sort of unreasonableness do we wish? Personally, I’d ignore the Idea altogether and simply live the Reality. But I’m unreasonable that way.

    #21086

    TheGreekOne
    Participant

    Well, Schäuble believes he has the right to meddle, because of the previous Goverments, who allowed Germany and Europe to interfere to such an extent, that all pretext was gone. During Samaras’ era, the collaborating Greek MSM happily parroted our beloved Reichskanzler Schäuble’s angry orders and threats to the Greek people, ad nauseum, every single day, 24/7. (Big Brother, anyone?) We even had a Gauleiter, a Reich’s Regional Governor in Greece! He was Herr Hans-Joachim Fuchtel, who was a vice-minister in the German Federal Government and was placed as the head of the “overseeing body” that would control every Greek minister on a daily basis, based in Athens. Fuchtel would bark orders to the Greek Ministers indirectly via the MSM, but much less frequently than our dear friend Schäuble would. The later was projecting his highly annoying angry-father-figure-dissapointed-and-furious-at-his-naughty-little-Greek-children persona since day one of Samaras’ rule. Even Samaras tried to copy that and be an “angry and aggressive father figure” himself, and thus impose his mighty will on the “Grsheeple” (or is it “Grvictims”? “Grpeasants” perhaps?). But he failed miserably, for he came out as looking ridiculous, acting badly and sounding very-very-very stupid.

    So these paternal media temper tantrum interventions, which Schäuble fetishizes so much and which are his superweapon of foreign affairs, are not a new thing in Greece, by a long shot. Troika wasn’t just the travelling circus you see; they were and are to some extent, an occupation force (That is why Tsipras was so eager to send them away, from day one). The iconic fair, tall, costumed European bureaucrats, who walk among the mortals through Athens’ streets, after a day’s hard work, to have their lunch break at expensive posh cafes and restaurants, looking absolutely fabulous, is a familiar sight for the Athenians for quite a few years now. They had actually become subtler and quieter for a while, but now they are back, flashing their glorious expensive power suits and looking top notch. And they continue to produce excrements as “solutions” to the Greek issue, which they then impose on the Government, just as they did before – now as part of a deal in the Negotiations Media Drama Reality Show. Now that Varoufakis is sidestepped, they do it in collaboration with “their people” who took over the Ministry of Finance. Take for example this nonsense new bill about the obligatory use of debit and credit cards on every single transaction over 70 euros – or is it over just a euro, if you believe the hype? – as a measure to “combat tax avoidance”. In a collapsed economy. Suffering from a deflationary crash. This is exactly the type of stupid sh!t policy they are preparing and imposing, to justify their salary and please their masters, who don’t care about fixing things, only looting. So intervention is not a new thing here. Let’s not forget the technocrat-banker PM Papadimos, then the VP of the Trilateral Committee, who took office without elections in 2011-12 and made things so much worst… A Reichskanzler does what he can… A Reichskanzler does what he can.

    #21088

    Dr. Diablo
    Participant

    Looks like you were on the case with Friday’s news:

    “We come with arguments, they reject them, then they say, ‘you’re wasting time’. What does that mean? It’s just saying, agree with us. You’re wasting time between getting elected and doing what we say.”

    Submit or Die. Those are your options.

    #21090

    Boogaloo
    Participant

    I generally find myself in agreement with almost all of the essays on this site. But for today’s essay I somewhat disagree. Germany/Schäuble are in the position of wealthy creditor. Greece is in the position of impoverished debtor. The debtor-creditor relation and dynamic goes back to time immemorial. This time, once again, the creditor demands a pound of flesh. Can we really express SURPRISE? Can we really pretend to be shocked and outraged when a creditor expects to have some say in the debtor’s affairs? I think not. That has always been the rule. Of course Greece should tell Germany to go to hell. But c’mon. Surprise that Germany wants to call the shots? No surprise here.

    #21094

    Formerly T-Bear
    Participant

    @ The Greek One, reply # 21086

    Spain also was exposed to such recalcitrance, obstinance from the troika at the beginning of the Crisis when Zapatero was PM in the socialist government of the time. It was obvious from the radical shift of policy that Spain was not going to receive support unless specific policies were put in place, diametrically opposed to socialist philosophy and practice. These destroyed Zapatero’s political career and directly led to his retirement from public service – at least he did not have to commit seppuku for his neoliberal political transgressions of being socialist.

    At that point had Spain instituted capital controls, allowing capital to leave only <b>after the obligations to repay the principle and interest issuing from the credit cycle born from the presence of capital in an economic entity, are completed</b>. This condition lays at the very heart of failure of neoliberal theology and its political policy spawn. Capital not meeting this requirement is economically irresponsible capital, (rather it is capital used for economic extortion – rent has nothing to do with the income due this form of capital and should be clearly designated as such – extortion). The trail of devastation caused by such capital and its effects upon the economic process litter the tale of recent economic failures, from Japan, Asian Tiger economies, Russia, the PIIGS (+ France, GB, Netherlands etc. waiting in the wings for their introduction) – vulture capitalism at its finest.

    The great fraud of neoliberal economic theology is the held belief – TINA – There Is No Alternative. There is. Some of it must be resurrected from the grave so thoughtfully dug by the neoliberal thought collective, some will have to be retrieved from the befogged and addled forrest of recent historical facts, reinterpreting their importance, some will have to come from synthesis and creative economic thinking, something that was lost when John Maynard Keynes was buried. Always beware of any who claim to have all the answers – that usually means there are no answers remaining for anybody else.

    #21095

    Formerly T-Bear
    Participant

    So much for [b] [/b] theory. Embolden doesn’t work atall. (smirchie)

    Would that be ‘strong’ instead?

    #21100

    bold

    it does work. use < and >, not [ and ]

    #21103

    Formerly T-Bear
    Participant

    In reply # 21094 see paragraph 2, line 2 through line 4 above. The brackets were substituted – intentionally – since there was nothing to embolden in the example. No fair having personal editing angels.

    #21118

    Maybe it’s a question of permissions?! I’m the big honcho, I can do anything, but I don’t know about other accounts. I can see what your code looks like in the source code, but it automatically translates it into <b> when I put it in a comment.

    #21123

    Formerly T-Bear
    Participant

    Ending this with – < b > XxXx < / b > did not work for me again. The last time I edited the ‘b’ to ‘bold’ and was corrected. Next time I shall try ‘strong’ instead and then quit the attempt altogether. I recognise the exalted status possessed, by the by.

    #21166

    Formerly T-Bear
    Participant

    Addendum to reply # 21094

    In addition to creating ex nihilo a parallel currency to replace the disappearing €uro for marketplace transactions, the Greek government has also to ‘un-privatize’ Greek Banks through re-charterization of those institutions. A model exists in one state in the U.S. which has chartered their state banks and has utilised those institutions to house the states receipts and used to pay state disbursements. While those funds are idle as far as state needs are fulfilled, they act to increase the credit for use by the bank for local lending needs. The banks themselves are private but under state charter, regulation and control so that local people who know local needs and local trustworthiness in meeting contractual obligations are the distributors of credit to the community. Supposing stories of corruption may be inflated, such strictly regulated banks may provide an alternative to the existing banking structure in Greece, and a way to distribute the state’s economic resources to the general population.

    Test: XxXx

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