Aug 012015
 
 August 1, 2015  Posted by at 9:54 am Finance Tagged with: , , , , , , , , ,  


Harris&Ewing “Slaves reunion DC. Ages: 100, 104, 103; Rev. Simon P. Drew, born free.” 1921

Time to tackle a topic that’s very hard to get right, and that will get me quite a few pairs of rolling eyes. I want to argue that societies need a social fabric, a social contract, and that without those they must and will fail, descend into chaos. Five months ago, I wrote the following about Europe:

Europe, The Morally Bankrupt Union

The European Union is busy accomplishing something truly extraordinary: it is fast becoming such a spectacular failure that people don’t even recognize it as one.[..] the Grand European Failure is bound to lead to real life consequences soon, and they’ll be devastating. The union that was supposed to put an end to all fighting across the continent, is about to be the fuse that sets off a range of battles. [..]

The carefully re-crafted relationship with Russia, which took 25 years to build, was destroyed again in hardly over a year, something for which Angela Merkel deserves so much blame it may well end up being her main political legacy.

To its south, the EU faces perhaps its most shameful -or should that be ‘shameless’? – problem, because it doesn’t do anything about it: the thousands of migrants who try to cross the Mediterranean to get to Europe but far too often perish in the process. [..]

But the biggest failure is not even in politics outside of its own territory. The union rots from within. Which starts with its moral bankruptcy, obviously. If you allow yourself to be an active accomplice in the death of over 6000 East Ukrainians, and you simply look away as thousands of migrants die in the seas off your shores, it should not be surprising that you just as easily allow for a humanitarian crisis, like the one in Greece, to develop within your own borders. It comes with the territory, so to speak.

And make no mistake: this absence of moral values is something Europe in its present form will never be able to claim back. Never. The EU has shown itself to be a gross moral failure, and that’s it: the experiment is over. They can’t come back in 10 or 20 years and say: now we want it back, we’re different now. You’d need to have a whole new union, new rules and principles, and new leadership. [..]

What will undo Europe from within is its economic policies. Which are strongly linked to the same moral values issue: inside a union, you cannot let thousands of people go without food and health care while others, a few hundred miles away, drive new Mercs and Beamers over a brand new Autobahn. That’s not a union. That’s a feudal society.

Though it may look out of far left field for those of us -and there are many- who think in economic and political terms only, we cannot do without a conscious definition of a social contract. We need to address the role of compassion, morals, even love, in our societies. If Jesus meant anything, it was that.

There have been times through history when this subject would have been much easier to breach, but we today almost seem to think they are irrelevant, that we can do without them. We can’t. But in the US, people get killed at traffic stops every day, and in Europe, they die of sheer negligence. Developments like these will lead to ‘centers that cannot hold’.

In that part of the media whirlwind that we at the Automatic Earth expose ourselves to, virtually all discussions about our modern world, and what goes wrong with it, which is obviously a whole lot, are conducted in rational terms, in financial and political terminology.

But that’s exactly what we should not be doing. Because it’s never going to get us anywhere. In the end, let alone in the beginning too, we are not rational creatures. And if and when we resort to only rational terms to define ourselves, as well as our world and the societies we create in that world, we can only fail.

For a society to succeed, before and beyond any economic and political features are defined, it must be based solidly on moral values, a moral compass, compassion, humanity and simple decency among its members. And those should never be defined by economists or lawyers or politicians, but by the people themselves. A social contract needs to be set up by everyone involved, and with everyone’s consent. Or it won’t last.

How and why that most basic principle got lost should tell us a lot about where we are today, and about how we got here. Morals seem to have become optional. The 40-hour death struggle of Cecil the lion exemplifies that pretty well. And no, his is not some rare case. The lack of morals involved in killing Cecil is our new normal.

In the US, these values seem to have long since disappeared from very substantial segments of society. A closer look would seem to teach us that this is largely because of the top down approach that comes with an oversized government apparatus that seeks to rule over what are today some 320 million people.

There are multiple reasons why such a government can’t work to make a society successful. First, there are far too many people to rule over; the human brain can’t conceive, other than in completely abstract terms, of meaningful human contact, in whatever shape or form, let alone of compassion, between such numbers of people.

The Catholic church, for all its failures, did succeed in binding a society together, and repeating that across many societies, but it never endeavored to gain control of every single political and economic system. Washington does.

Making morals optional necessarily means they will vanish. All strong societies through history had strong and binding social contracts. Less successful ones did not. We, however, have only financial and legal contracts left, no social ones other than those that are almost entirely optional. We ourselves cannot kill people at will, but our governments can. We -apparently- can still kill lions, though.

The second most important reason why the US, and now the EU with it, are destined to fail, is that their structures, which with the numbers of people involved must of necessity become less democratic with time, inevitably slide into selecting for the exact wrong kind of people, as I’ve often argued before.

Societies this size inevitably select for power hungry sociopaths; there is no other option. It’s a process we even see also in smaller scale societies today. With the advent of serious attempts to utilize Freud’s theories for penetrating people’s unconscious minds, picked up by Goebbels and since perfected by secret services, spin doctors and ad agencies, the world has become a whole other place. Even if most haven’t noticed.

The curious thing is that many separate EU nations for many years did have such compassion and humanity. Which these days are often mistaken for socialism. Which in turn, if we may believe the majority of pundits, is about the worst principle a country can pick to build its society on.

In reality, though, most of it has always simply been a matter of precisely that by which we can, should, judge a society’s success and viability: the extent to which it cares for its weakest and most vulnerable.

That in some cases this has perhaps been taken too far, doesn’t change the fact: we still can’t call a society successful that leaves its weakest to starve by the curb. And it doesn’t matter how much distorted Darwinism and Ayn Randism and neo- or ordo-liberalism one may wish to throw at it. A successful society must take care of all of its members to the extent that it can. Simply because man is a social animal.

Still, the principle of compassion seems to have all but vanished with the development of the European Union. And if there’s one main reason why that Union is doomed to fail, it’s that. It’s not the failed economic policies, it’s not even the increasing power politics that doom it: it’s the relentless drive towards a group of individuals seeking the power to manipulate millions of people they never met, with impunity.

The divergence between individual European nations and the Union seated in Brussels is also the source of much of the division between both. Greece doesn’t want to let its people slide into further misery. Brussels couldn’t care less: Athens has to stick to rules and regulations no matter how many of its children go hungry or how many of its elderly pass away from entirely preventable afflictions.

It’s right there, in that division, that the EU is blowing up itself. You can’t have a viable political or economic union if you don’t take care of the weakest. Thing is, once you got the sociopaths in charge, the inevitability of the process of losing and eroding a social contract gets ignored. Unless and until the people in the streets pick it up again.

No, the biggest issue in Europe is not whether the Union moves toward even closer ties. The biggest issue is that the Union is morally deficient in its core.

Ironically, it’s the Greek people who understand much better than the Dutch and Germans that “without love, it ain’t much”. And they are labeled a less developed society for it. While the less fortunate in Berlin, Paris and Amsterdam continue to receive relatively generous welfare and other benefits, certainly compared to their Greek peers. A two-tier union is not some future concept, it’s here.

And it’s not just Greece. The embarrassing situation with the refugees at Calais is due to the exact same moral quicksand. David Cameron is going to send “dogs and fences”. He’s going to send in dogs to ‘fight’ against people! We’ve seen that kind of thing before. And the military can’t be far behind.

It’s the only answer a certain class of people manage to come up with. After they’ve ignored and tried to wish away an issue they should long have tackled. It’s only when British tourists and truck drivers start complaining that Cameron ‘acts’. The refugees have been at Calais for a long time, during which no. 10 did nothing at all.

Just as disgraceful is the influx of African and Asian refugees on Greek islands that Brussels refuses to do anything about. The Greek population try to do what they can, as do the Italians. But their budgets are all in EU hands now, and Brussels doesn’t care. The EU’s only response is force, not compassion or moral values.

There are mass migrations going on in many parts of the world. They are the inevitable result of the means of mass transportation and mass communication we developed. We have two options: either we facilitate for the inclusion of the refugees in our societies, or we actively help develop their homelands. If we don’t, they will still keep coming, and things will get ugly.

Whichever choice we make, we need to do it in a spirit of humanity. We can’t turn our back on these people, not the Greeks, not the refugees, that can only come back to haunt us. And besides, we don’t have the -moral- right. In the meantime, don’t let’s forget that the number of refugees in Calais pales in comparison to the numbers that land in Greece on a daily basis.

The governments that represent us put us to shame as human beings. But in the end it’s us, ourselves, who allow them to do it.

It may be strange to see a finance site argue that letting finance set society’s values is a dead end, but at the same time we all know what’s involved, we just choose to be blind to it. Man cannot live by money alone, just as he cannot live by bread alone. We are not Christian, but we do remember this:

Matthew 4-4: “But he answered and said, “It is written: ‘A man does not live by bread alone, but by every word that proceeds from the mouth of God.’ “

Again, this is not optional. We can either get this right, or we’ll descend into chaos. Something many of our ‘leaders’ would not only welcome, but are actively instigating. It’s up to us, and that means you too, to keep them from doing it.

Take a look at the black kids getting killed in the US, look at the Greek children and grandmas who don’t have medicine or food, look at the refugees that are part of today’s mass migration, and who get dogs send in against them, look at all the areas in the world where our -western- interference has caused mass misery for profit, and if you still don’t get it, take a look at Cecil, and what his death symbolizes about our societies and values.

Societies which we are all part of, and values we should share in order to maintain our societies as going concerns. We may well have just one last chance to get it right. But that chance is fading as fast as our penchant for compassion. The lunatics have truly taken over.

Jun 092015
 
 June 9, 2015  Posted by at 4:57 pm Finance Tagged with: , , , , ,  Comments Off on Why Greece Must Leave


John Vachon Five o’clock crowds, Chicago 1941

French Economy Minister Emmanuel Macron and German Vice-Chancellor Sigmar Gabriel published a piece in the Guardian last week that instantly revived our long nourished hope for the European Unholy Union to implode and be dissolved, sooner rather than later. The two gentlemen propose a ‘radical’ reform for the EU. Going a full-tard 180º against the tide of rising euroskeptism, the blindest bureaucrats in European capitals are talking about more centralization in the EU.

Here’s hoping that they follow up with all the energy they can muster, and that we’ll hear a lot more about the ‘reforms’ being proposed. Because that will only serve to increase the resistance and skepticism. Let them try to ‘reform’ the EU. We’re all for it. If only because if they do it thorough enough, referendums will be required in all 28 member nations, which all need to agree, in a unanimous approval vote.

The gents know of course that that is never ever going to happen. So sneaky ways will have to be found. Something Brussels is quite experienced at. They’ve shown many times they won’t let a little thing like 500 million citizens get in their way. We’re curious to see what they’ll come up with this time.

Meanwhile, though, the rising skepticism threatens to rule the day in many countries, and Greece is by no means the leader in the field. Germany has a rising right wing party that wants out (just wait till Merkel leaves). Marine Le Pen has vowed to take France out as soon as she gets to power, and she leads many polls. Britain’s Ukip is merely the vanguard of a broad right wing UK ‘movement’ that either want out or have treaties thoroughly renegotiated.

Portugal’s socialists are soaring in the polls on an EU-unfriendly agenda. Spain’s Podemos is no friend of Brussels. In Italy, M5S’s Beppe Grillo has gone from skeptic to outright adversary over the past few years. There are varying levels of antagonism in all other countries too.

Now obviously, not all countries in the union carry the same weight, politically speaking (why do we so easily agree that’s obvious, though?). You have Germany, then a big nowhere, then France and Britain.

Greece, equally obviously, has no say. They can elect a government that wants to change things even just at home, and be told no way. If Germany would elect such a party, all EU policy would change in the blink of an eye. A true union of sovereign nations it therefore is not. And that of course was never possible, it was just something people wished for who never contemplated the details or consequences.

Still, given that the whole project has always been represented as a one-way street from which escape is not possible, the weight of the smaller nations should not be underestimated. Perhaps all it will take is one defector to make the entire edifice unstable. Statements to the contrary are made only by people who eat hubris for breakfast, lunch and dinner.

If either France or Germany leave -the former looks far more likely right now-, it’s project over. The same would probably hold for Italy. Spain would be a grave blow. Britain might be quite a bit easier (no euro), though negotiations -let alone referendums- over treaties could cause a lot of havoc and unrest. While various bigwigs try to fool you into thinking that letting small nations leave can be ‘ringfenced’, that is utter nonsense, they have no way of knowing.

David Cameron tries to convince himself that he can get away with establishing some sort of status aparte for Britain, but others may want such a status too, and they may have a list of points they want to discuss if and when treaty changes are put on the table. Multiple that by 28 and before you know it either nothing changes, or everything does.

The Union was hastily and sloppily cross-stitched together when everyone was still exclusively dreaming more of mass lift-all-boats profits in the offing, than caring about the fineprint of compromise squared treaties or considering possible future consequences if and when the profits would turn out not to be unlimited. Ergo, everything that happens now is an improvised play performed by 28 at best mildly talented actors trying to convey an air of confidence. That’s all that is left.

Throw all this in a pile, and renegotiating any EU treaty will to a high degree of probability be akin to opening Pandora’s cesspit. And besides, any changes would never pass if a referendum were held. Macron and Gabriel are all too aware of this pesky factoid:

“What’s important is the project,” Macron said in an interview with Le Journal du Dimanche. “Treaty change is a method that would ensue and that we have to prepare in due time,” he said, warning that European people would probably reject a new treaty if asked in a referendum.

Meanwhile, British demands to opt-out from “ever closer union” could be accommodated by a special “protocol” to the EU treaties, according to Manfred Weber, a Christian Social Union MEP who is a close ally of German Chancellor Angela Merkel. But in return, Britain would have to accept losing its veto in areas where others forge ahead with deeper integration, the German MEP warned.

In 2005, both France and Holland rejected the EU constitution in respective national referenda. But Brussels just ‘forged’ ahead as if it didn’t matter. Today, however, let’s see them try that again.

Ten years ago, the profits were still in vogue. But things have changed, and problems are everywhere. Problems that Brussels seeks to ‘solve’ by gifting itself with ever more centralized powers. But the undoubtedly biggest problem of all they have is that not 10% of Europeans would vote to give them these powers. So please, please, try.

As for Greece, all the negotiations really are just a matter of fiddling while Rome burns. But that is not because Greece is in trouble; it’s because of what the EU has become. A club that depends on its ability to scare members into submission, the same vein the IMF operates in. The negotiations are about amounts of debt that were imposed upon Greece by the troika when it decided to bail out banks of Europe’s most powerful member nations and put the Greek people on the hook.

Europe’s high and mighty will yet come to regret the decision not to restructure these banks, because this will be the catalyst that blows up the Union. The reason why will become apparent as debt rises further and asset markets start falling off so many cliffs.

Greece should get out as fast as it can, all member countries should, especially the poorer ones. There is no benign or even economically viable future for any of them in the Union. A future inside the union is infinitely more frightening than one outside.

What is evident by now is that the troika creditors don’t come to the table to negotiate, they come to impose their will. And those countries that carry the most debt are most vulnerable to the threats flung across the table. If you don’t get out, in time Germany will decide what you can eat, what your children learn in school, and how you are to behave. You will no longer live in sovereign nations.

The eurozone must fail. And so must the EU. That is better for everyone who’s not inside the power circles, in the long term. What countries should do now is ‘ringfence’ themselves as best they can from the nuclear fallout the failure will lead to. Focus on resilience.

While the leadership everywhere dreams of ever more centralized power, economic reality dictates decentralization. It can only be halted through propaganda and violence. But that will merely be temporary.

Even if Brussels somehow ‘solves’ the Greece issue, others nations will follow, be targets of financial markets, and once it comes to Italy or Spain, who are both in very precarious places, the EU and the ECB are simply not strong enough to absorb the blow. And then where do you think that leaves you?

I’ve said many times before that all governments, power structures and supra-national organizations are a magnet for the last people you would want to lead them: sociopaths. That’s not an opinion, it’s a description of the dynamics of human group psychology. Greece itself before Syriza is a prime example of this.

The smaller the countries, states, regions that politicians are allowed to rule over, the less likely leadership posts are to attract sociopaths. Other considerations count too, remuneration, chances to forge ties with an elite and serve their purposes. Larger entities are certain to attract pathological minds. Exceptions to the rule are far and few between. Also: the more a society manages the field of propaganda, the likelier it is to get -and keep- a sociopath as its leader.

The US is a good example. So is the EU. And obviously, the IMF, World Bank, NATO, FIFA. We always fail at ‘doing large scale’ for the benefit of the people. The large the scale, the less the people benefit.

Just when its moment of glory seems to arrive, globalization will lead towards decentralization and protectionism. Just as stability leads to instability.

The EU’s socio-pathological trait is evident in the way the organization’s leaders deal with Ukraine, with the refugees off its southern coasts, and, inside its very borders, with Greek society, unemployment, hunger and hospitals. There is no compassion, no conscience.

In the EU, the idea(l)s have become the problems, argues Stratfor’s George Friedman:

Is The European Union Already On The Brink Of Inevitable Disaster?

The fact of the matter is that a free-trade zone in which the black hole at the centre, Germany, absolutely overwhelms all of its competition, and the competition can’t protect itself, is untenable.

[..] many of the great ideas that the European Union began with have turned, as it frequently happens in history, into the problems.

Q: [..] ..you said a group of squabbling nations, and you’ve alluded to the history, from the Franco-Prussian wars right up to 1945, the history is very, very unpleasant indeed. Is the corollary that Europe will eventually descend back into war?

George Friedman: Well, the question is really has it ascended? From ’45 to ’92, Europe was occupied by the Soviets and the Americans. The fundamental questions of sovereignty were not in the hands of London or Berlin or Rome, it was in the hands of Washington and Moscow. In ’92, the Soviet Union collapsed, and for the first time since WWII, Europe became genuinely sovereign. And for 16 years, they made a go of it. For the last seven years, it’s been rather disastrous, and the question is, can they reverse it?

And if they don’t reverse it, what prevents them from returning to the kind of history that is normal in Europe? And what I’m arguing is that basically, the period of ’92 to 2008 was an interesting aberration. We are now back to the old normal, and how bad it becomes really depends on a bunch of (inaudible) issues. But first we have to really recognise that the Europe that was envisioned in the European Union is not going to return.

We had better not forget that. If Europe will never be what it was supposed to be, then why would anyone want to be part of it, apart from the few that profit most? If the corollary truly is that Europe will eventually descend back into war, isn’t it time to take care of your own? And isn’t that, really, what the Greeks are already trying to do today?

Very timely for this article, Tyler Durden posted a piece by Jeff Thomas today that delves deeper:

The New World Order – A Faustian Bargain

[..] most people in any given country seem to believe that the political parties that rule them do not collude in their own collective interest and against the best interests of their respective constituents.

Similarly, they are unlikely to accept that fascism exists in their country—that members of their favoured party collude with industries. Further, most people seem to disbelieve that the leaders of their own country collude with the leaders of their country’s enemies in such a way that might create loss or danger to their own people. This is naive. Such collusions are the norm rather than the exception.

Those who tend to be more informed, readily acknowledge that collusion exists between all of the above, to one degree or another. If this group errs, it is often in the opposite assumption—that the collusion is all-encompassing.

There can be no doubt that a New World Order is being sought by some—this has been made clear for at least a hundred years by many who regard themselves as an Elite. It is therefore an open secret.

In my experience in dealing with political leaders (and political hopefuls) from several jurisdictions, I’ve found there to be a consistent sociopathology (by definition, the desire for dominance over others, undeserved self-confidence, lack of empathy, a sense of entitlement, lack of conscience, etc.).

Sociopaths are drawn to political leadership for obvious reasons. First, they’re prone to collusion, as they recognise that it may further their interests [..] Trouble is, the same sociopathology would drive the same individuals to seek to dominate each other.

It has been postulated by many that those who see themselves as an Elite are nearing the completion of what they perceive as world dominance. However, should they succeed, they will betray their partners the very next day, as it’s their nature to do so.

First, there most assuredly are extremely domineering forces (regardless of how closely associated they might be), which, in the near future, will do immense damage to the cause of freedom in the world, particularly in those countries where they are most dominant, or will become most dominant. Second, the situation does appear to be reaching a head.

The two greatest uncertainties will be how much damage will be done before the dust has settled, and how protracted the period of destruction and struggle for dominance might be. [..] The best that can be done is to work at placing ourselves as far outside of their sphere of influence as possible.

That describes how the EU functions, and why Greece -first of all, and first thing in the morning- needs to leave. There is no future in the EU that anyone wants to live in. It’s not a tide that will lift all boats, it will sink them.

Mar 202015
 
 March 20, 2015  Posted by at 8:59 pm Finance Tagged with: , , , , , , , , ,  


DPC Provision store. Caracas, Venezuela 1905

Once again, a look at Greece and the Troika, because it amuses me, it angers me, and also because it warms my cockles, in an entirely metaphorical sort of way. The Troika members love to make it appear (and everyone swallows it whole) as if in their ‘negotiations’ with Greece all sorts of things are cast in stone and have no flexibility at all. Humbug.

First, another great piece by Rob Parenteau (via Yves Smith), who lays it out in terms so simple they can’t but hit the issue square on the nose. For Europe and the Troika, there’s Greece, and then there’s the rest. No money for the Greeks lining up at soupkitchens (not even for the soupkitchens themselves), but $60 billion a month for the bond market. The $200 million anti-poverty law – a measly sum in comparison – that Athens voted in this week is a no-no because Greek government has to ask permission for everything in Brussels first, says Brussels, no matter that that only prolongs the suffering. It’s not about money, in other words, it’s about power, and the Greeks must be subdued.

Both the financial and the political press have by now perfected their picture of Yanis Varoufakis as a combination of some kind of incompetent blunderer on the one hand, and a threat the size of Vladimir Putin on the other, while the rudeness of German FinMin Schäuble is not discussed at all. The media are no longer capable of reporting anything outside of their propaganda models. The ‘middle finger’ video turns out to be a fake, but who cares, it’s done its damage. Parenteau:

Goebbelnomics – Austerian Duplicity and the Dispensing of Greece

So let’s get this straight. The Troika does not have enough money to roll over Greek debt (in a Ponzi scheme like fashion, mind you) – debt that was incurred not so much as a bailout of Greece, but more as a bailout of German and other core nation banks and insurance companies and private investors who made stupid loans to or investments in Greece, but refused to fob them off on their own taxpayers.

But the Troika does have enough money to adequately perform damage control for the eurozone if Greece, because, you know, Greece is a “dispensable” eurozone member – even though ECB lawyers themselves say there is no legal mechanism for disposing of eurozone members in any such fashion.

No money in Greece for humanitarian aid in a country that may be on its way to becoming a failed nation state. No money outside Greece to roll over existing debt, or when necessary to extend and pretend, add more debt on existing debt to service the old debt, Charles Ponzi style. But somehow there is still “sufficient” money to ring fence Greece from the rest of the eurozone once Greece figures out it is dispensable and so must exit.

But that is not even the whole deception. It turns out the ECB does happen to have enough money to buy €60 billion per month of bonds from now until at least September 2016. Which means the same bondholders who are benefitting from the misnamed “bailout” funds used to keep the core nation financial institutions from collapsing under the weight of failed loans, can now count on a monthly government handout, courtesy of the ECB.

Some are more equal than others, in other words. That is true also of Ukraine, which gets to issue bonds guaranteed by the American taxpayer. If Greece could do that, they‘d have a way out of the dark pit austerity has thrown it in. And Greece isn’t even killing its own people…. But then Kiev doesn’t need to be subdued, it’s already being ruled exclusively by US stooges.

To come back to Schäuble lack of basic civil manners for a moment, it’s of course not true that Germany has an ironclad case against the Greek demands for WWII reparations. If it did, none of the rudeness would be necessary. And aside from that, even if the case was indeed closed, Germany would still need to be open and respectful and way more civilized than it is at present. WWII is a very black chapter in world history, and it’s not some very remote event. Even if post-WWII German schoolchildren never learned anything about what their parents and grandparents had done.

Maybe there’s a task here for the world Jewish community. Schäuble’s attitude smacks of denial, much more than respect for victims and their surviving family members. And besides, there were a lot of Greek Jews who became victim of German atrocities.

But to focus for now on the purely legal side of the matter, there’s at the very least a large grey area:

Legal Experts: Greece Has Grounds for WWII Reparations

A growing number of legal experts are supporting Greece’s demands over the German war reparations from the country’s brutal Nazi occupation during World War II. Despite the official German refusal to address the issue, legal experts say now Athens has ground for the case. The hot issue is expected to be brought up by Greece’s newly elected Prime Minister Alexis Tsipras during his official visit to Berlin on Monday, where he is scheduled to hold a meeting with the German Chancellor Angela Merkel. [..]

The Greek leftist-led coalition government has repeatedly raised the issue causing Germany’s firm reaction as expressed by German Finance Minister Wolfgang Schaeuble, who recently warned Athens to forget the war reparations, underlining that the issue has been settled decades ago. Central to Germany’s argument is that 115 million deutschmarks have been paid to Greece in the 1960s, while similar deals were made with other European countries that suffered a Nazi occupation.

At the same time, though, lawyers from Germany and other countries have said the issue is not wrapped up, as Germany never agreed a universal deal to clear up reparations after its unconditional surrender. The German answer on that is that in 1990, before its reunification, the “Two plus Four Treaty” agreement was signed with the United Kingdom, the United States, the former Soviet Union and France, which renounced all future claims. According to Berlin, this agreement settles the issue for other states too.

“The German government’s argument is thin and contestable. It is not permissible to agree to a treaty at the expense of a third party, in this case Greece,” international law specialist Andreas Fischer-Lescano said, as cited by Reuters. Mr. Lescano’s opinion finds several other experts in agreement. One of them, the Greek lawyer Anestis Nessou, who works in Germany highlighted that “there is a lot of room for interpretation. Greece was not asked, so the claims have not gone away.”

Merkel had better start taking the matter very serious, and in a very respectful way to boot. Because no matter how well oiled the publicity spin machine is, Schäuble’s attitude, mirrored by many of his countrymen, will awaken in countries all across Europe the realization that they don’t want this from Germany, they won’t be ruled by Berlin, and they won’t stand for more German uncivilized behavior either. The memories are far too fresh for that.

As I said the other day, Merkel had better take the reins in all this, because she risks blowing up the entire European Union if she lets things slip further. Let Greece go, if only by trying to force it into some sort of debt servitude which the Greek people deem unacceptable on moral grounds, and the EU project will start shaking on its already feeble foundations.

There’s only one thing that can save the Union now: for Merkel to show compassion, with the Greeks, and with all other weaker members. And to stop the anti-Greek propaganda, immediately. Or else. It’s nonsense to pretend that this is merely a business issue, as is made clear by Parenteau above: there is very clearly plenty space to negotiate solutions with Greece that preserve everyone’s dignity. Refuse that, and you can kiss the EU goodbye. There’s alot more that plays into this than mere money issues. Ignore that, and you might as well dismantle the Union right now.

And there are indeed other approaches too. Like that of the German couple, whose story I picked up some 24 hours ago on RT, and which has since appeared on a whole scale of media:

German Couple Pays €875 To Greece For Their Share Of WWII Reparations

A German couple visiting Greece have handed over a check for €875 to the mayor of the seaport town of Nafplio, saying they wanted to make amends for their government’s attitude for refusing to pay Second World War reparations. Nina Lahge, who works a 30-hour week, and Ludwig Zacaro, who is retired, made the symbolic gesture and explained that the amount of €875 would be the amount one person would owe if Germany’s entire war debt was divided by the population of 80 million Germans.

“If we, the 80 million Germans, would have to pay the debts of our country to Greece, everyone would owe €875 euros. In [a] display of solidarity and as a symbolic move we wanted to return this money, the €875 euros, to the Greek population,” they said.

They apologized for not being able to afford to pay for both of them. “We are ashamed of the arrogance, which our country and many of our fellow citizens show towards Greece,” they told local media in Nafplio, southern Greece. The Greek people are not responsible for the fiasco of their previous governments, they believe.

“Germany is the one owing to your country the World War II reparation money, part of which is also the forced loan of 1942,” they added. The couple was referring to a loan which the Nazis forced the Greek central bank to give the Third Reich during the WWII thus ruining the occupied country’s economy. The mayor of Nafplio, Dimitris Kotsouros, said the money had been donated to a local charity.

And a perhaps even better story comes, almost entirely under the radar, through Kathimerini. Turns out, where Brussels and Berlin spend their time blaming Tsipras and Varoufakis for everything that happens, Norway, not an EU or eurozone member, steps in to alleviate the worst of the suffering:

Athens Mayor Unveils Scheme To Support Poor With Help From Norway

Athens Mayor Giorgos Kaminis, Norwegian Ambassador Sjur Larsen and the president of nongovernmental organization Solidarity Now, Stelios Zavvos, on Wednesday inaugurated a new program to provide support to the Greek capital’s poor. The Solidarity & Social Reintegration scheme comprises a food program benefiting 3,600 households, as well as a space provided by City Hall and managed by Solidarity Now where the organization will provide social, medical and legal aid, among other services.

“The aim is the immediate relief of those in need by providing food, medical care, social services, legal support, help finding employment, and support for single-parent families, children and other vulnerable groups,” said Larsen, whose country has donated 95.8% of the €4.3 million needed to fund the program. The other donors are Iceland and Liechtenstein.

Note: Brussels and the IMF have refused to do what Norway does. They have also refused to let the elected Greek government take care of its own people, without first asking permission to do so. It’s an insane situation, if you ask me. And I don’t see why the Greeks would stand for it any longer. If they vote to leave the eurozone, and perhaps the EU, they will have a hard time for a while, for sure, and it will be made much harder by the Troika, simply out of spite.

But they would face an at least equally hard time if they choose to stay inside the shackles Brussels and Berlin want to lock them in. The EU is supposed to be made up of independent nations. And while it’s certainly true that that is perhaps its fatal flaw, trying to take away that status from the Greeks will drive them away, and warn other countries as well that they could be next in line for the same shackles.

We’re looking at economic warfare here, and there can be no doubt that it will end with only losers on all sides. Unless Merkel wakes up and smells the roses.