Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller
Austerity doesn’t just lead to unemployment and misery. If it goes on long enough, it will inevitably lead to the emergence of “swamp thing” extremists into positions of power. Take the situation in Greece, a country which until recently was a wealthy Western democracy with a relatively stable political system. After five years of depression, voters in Greece just fired their equivalent of the Democrats and Republicans, and replaced them with anti-bailout groups, mostly on the left (Syriza and Communists), but also with the neo-Nazi group Golden Dawn on the right.
This should be a wake-up call to political elites globally, because Greece could simply be the start of a trend of collapsing centrist politics and the rise of dangerous political actors. 7% of Greeks, including a substantial number of the police, voted for a fascist anti-immigrant party whose platform is a mixture of economic populism and xenophobic racist lunacy. 21 Golden Dawn members were elected to Parliament. Golden Dawn political machine includes roving gangs of thugs that routinely beat up immigrants, and its political platform includes placing mines on the border between Greece and Turkey to prevent immigrants from coming into the country.
This is what austerity produces – extremism. Fortunately, Golden Dawn only got 7% of the vote, and only 21 seats in Parliament. And mostly, the Greeks voted for parties on the left who reject austerity. Greeks don’t want neo-Nazi groups running the country, they just don’t want corrupt bankers running it either. The man who garnered the most power from the election, leftist Alexis Tsipras of Syriza, has called the situation in Greece a “humanitarian crisis”. That’s just reality. Greece has a large, untouchable patronage system, a big defense sector, wealthy who escape from taxation – and yet international bankers are demanding radical cuts in wages, pensions, and jobs for honest workers.
So people voted for the political parties who rejected the banks. Greek leftist leader Alexis Tsipras is proposing to actually deal with the country’s problems head-on.
By not paying its debts, the country would have enough cash to pay its workers and retirees, he said. He also proposes cuts in defense spending, cracking down on waste and corruption, and tackling tax evasion by the rich.
“Whatever we do, things will be difficult. But it will also be difficult at the same time for all of Europe because the euro will collapse” if Greece’s funding is cut off, said Mr. Tsipras. Both sides should step back “before we reach that point,” he said, and find a “European solution.”
…
Mr. Tsipras, an engineer by training, recommends a stimulus package to boost the Greek economy and has called for tearing up the country’s existing austerity-for-loans program. He has suggested scrapping plans to lay off 150,000 public-sector workers by 2015, and repealing recent measures to push down private-sector wages. He favors nationalizing the banking system so as to better direct lending policies, and speaks favorably of Franklin Delano Roosevelt’s Depression-era New Deal program and President Barack Obama’s stimulus package—something Mr. Tsipras said is lacking in Europe.
Given the dire situation in the country, this is a sensible, even moderate, set of proposals. And in fact, all of the anti-bailout parties, from Golden Dawn to Independent Greeks (right-wing but not fascist) to Syriza, share the goal of having the Greek state take control of its political order and move on a populist economic platform.
It is telling that Kammenos, despite his origins on the right, praised the economic program of SYRIZA in the run-up to the election—a program which calls for bank nationalization, a repeal of wage and pension cuts and of new, more flexible labor laws undermining collective bargaining. In fact, Golden Dawn’s anti-immigrant venom aside, its economic proposals are often hard to distinguish from those of SYRIZA and Independent Greeks.
The Greeks think that the system is rigged against them, which it is. It was German and French banks who lent Greece huge sums of money, and Goldman Sachs that helped the government lie about its debt load. Bailing out Greece is really just bailing out these German and French banks. Even as Germans demand cuts in social spending, German leader Angela Merkel isn’t calling for the Greeks to cut defense spending, because Germany sells Greece lots of weapons.
That said, a Greek exit of the Euro would be chaotic – devaluations aren’t pleasant, and this one would be worse because there isn’t a currency in place to devalue. But endless austerity is a hopeless path. With the state collapsing (that’s what the rise of Golden Dawn vigilantism is really about), the prospects are pretty frightening either way.
Hopefully, the European elites will decide to give Tsipras a chance to govern. At this point, it looks like Greece will muddle along, inside the Euro, with a better deal than it has right now, in a still unsustainable though less dire situation. In the medium term, a stronger fiscal union or a Eurozone dissolution will happen. But if the European elites do what they can to kneecap a truly non-austerity based governance posture, Golden Dawn is waiting in the wings. Greeks are voting for political parties that are reasonable and anti-bailout, because they think that they are getting a raw deal. But if it becomes clear that the choice is between an endless and hopeless humanitarian crisis, where the rich do fine and everyone else suffers, and roving gangs of neo-Nazis who promise to restore Greece to greatness while giving the finger to bankers, well, we’ve seen that movie before.
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Mr. Tsipras, an engineer by training, Matt Stoller
Good sign! Engineers tend to be the salt of the earth.
And a Liberal Engineer at that, means he is capable of considering opposing arguments and still retaining mental function, so he isn’t an idiot. I’m curious to see if he, after negotiating the election process, is now bought and paid for like American elects, or if he truly can follow through on the platform he ran on. So far it appears to be the latter.
Greeks as of yet aren’ totally sold on the “extremists.” See Bruce Krastings article:
http://brucekrasting.blogspot.ca/2012/05/surprising-conversation-with-athens.html
I’m curious to see if he, after negotiating the election process, is now bought and paid for like American elects, Tim
A good Jewish or Christian engineer would never take a bribe. The Bible says not to.
Ironically, belief in the next world makes this one a better place to live.
I think you are a religion troll.
phew…. I thought you were serious all this time….
I am serious.
I’m not particularly interested in converting anyone but I can’t help pointing out that this post-Christian world has shot itself in the foot. Why shouldn’t people sell out if they can if this world is all there is?
“but I can’t help pointing out that this post-Christian world has shot itself in the foot. Why shouldn’t people sell out if they can if this world is all there is?”
If you’d actually investigate, you’d find that neither the US nor the world could even remotely be considered post-religion, that the modern world actually has far fewer casualties from wars and other man-made causes than previosu eras when virtually everyone was religious (i.e., believed in a god or gods of some sort), and that unethical business organizations and owners have existed in quantity since civilization’s day one. Also, consider that due to widespread instant communication in the modern world and 24-hour “news” channels that need to fill up those 24 hours with something, you read and hear about bad things you never would have heard about not that many years ago.
I’m not particularly interested in converting anyone but I can’t help pointing out that this post-Santa world has shot itself in the foot. Why shouldn’t people sell out if they won’t get any presents or any coal in their stockings?
The reality is we are living under ever increasing in intensity closet fascism right now. It relies on the secessionist corporate structure and the Noble Lie. The Noble Lie promises lots of presents, no coal in the stocking and heaven on earth. YOU — yes YOU — will be the next mega bucks winner, the next American Idol, the next corporate CEO, the next instant winner, the next movie star, the next to get a free car on Oafra, yada yada yada and yada, ka-ching is coming for you! Just hang on and keep voting, Santa will be here before you can say bye bye social security!
Closet fascism, which is presently murdering your fellow citizens in America, and is cause for the intentionally created herd thinning conditions in Greece, relies on gullibility and appeals to the worst in all of us. You keep it in power and are complicit with its immorality and evil by validating it and legitimizing it with your vote.
Deception is the strongest political force on the planet.
You keep it in power and are complicit with its immorality and evil by validating it and legitimizing it with your vote.
I’ll register my discontent at the polls by voting 3rd party or by some other way.
@beard… were you in stasis for the last two shrub presidency’s?
Which side always brings their guns to a debate… cough… town hall meeting, separates its self from all others regardless of empirically proven evidence – DNA, and for what reason?
Skippy… the most epic fill in the blanks exercise this planet has seen, yet your befuddled? Personally I find it indicative of this hole mess, take all the *credit* and externalize – socialize all the failure. What’s not to like!
Hey, now! If *ONLY* the many other self-professed “Christians” would read the Bible the way F. Beard does… !!
Don’t worry, the Christianist Leviticans have it all under control. Kill the gays, keep the youngest daughter for some ready cash and boy, everyone who’s wearing those polyester cotton clothes with two different threads are an abomination and are going to pay for it.
See item 9 in the link:http://www.costanzo.org/understanding_leviticus.htm
Well, the Old Testament Law applies to the Hebrews only – Christians are not under it. That was the purpose of Christ’s Coming – to fulfill the Law.
So unless you convert to Judaism, I reckon you’re safe except for possibly being enslaved by Hebrews.
Where I am consulting right now, the company just filed charges against a professional who stole $35,000. She and her fundamentalist preacher husband are now on the run. All that good fundamentalist preaching taught them something.
This is what I say, when someone starts talking patriotism or fundamentalist religion they are doing so to get you to do something against your better judgement. In other words patriotism and religion are the refuge of scoundrels.
…isn’t anyone going to say something nice about the neo-nazis?…:
http://www.youtube.com/watch?v=K08akOt2kuo&feature=related
…woudn’t want NK to be known as “socialist”…
…isn’t anyone going to say something nice about the neo-nazis?…
They sound a whole lot like the far right in the U.S.????
“Ironically, belief in the next world makes this one a better place to live.”
What if the “the next world” is still earth-bound…i.e. belief in creating a better world here and now.
And secondly, I’m not sure that statement is true. It sounds all folksy and homespun, and makes every dolt feel wise because they understood irony, but it doesn’t ring true. Most of the Christians who consider themselves evangelical/fundamentalist that I know don’t pay any attention to the economy or politics. They don’t care because they’re too busy “storing up treasures in heaven”. As far as doing good deeds on the individual level, they don’t help anyone anymore than anyone else. Actually, I usually notice a strong apprehension among fundamentalists towards helping the depraved unless it leads to an opportunity to proselytize. Case in point?
“Why shouldn’t people sell out if they can if this world is all there is?”
Seriously, F. Beard is touching on the psychotic. Apparently if there was no God/afterlife to live for he would steal, kill, and rape to his heart’s content. Oh no wait, that was a little over the top. Apparently, he would just screw people over more when given the opportunity. The only thing keeping him in line is all the chocolates and prizes he gets when he dies if he’s a good person here on earth. Honestly, who is the more moral person, one who chooses to do right without promise of reward or the person who only does right because they’ll get a mansion in heaven one day?
Your comment is one of the oldest and silliest arguments for belief in a God/afterlife and you sound like a opportunistic moral monster.
The only thing keeping him in line is all the chocolates and prizes he gets when he dies if he’s a good person here on earth Deborah
Naw, I’ll be content with shame avoidance.
and you sound like a opportunistic moral monster. Deborah
Nope, not particularly. I just wonder sometimes at the logic of the godless.
F. Beard: there are no gods. We’re all alone here. All we have is each other, and this is the only life we have. We would like to be treated well. So we’d better treat each other well — there’s no outside superbeing to treat us well, so we have to do it ourselves. And we’d better do it now, in this life — because there isn’t another chance, this is all we’ve got.
This is a simple, straightforward moral philosophy.
F. Beard – “Nope, not particularly. I just wonder sometimes at the logic of the godless.”
Wonder no more, you can consider me an indifferentist as I don’t care enough about religion to be an atheist. Nevertheless I treat people as I would be treated as I need to live w/myself when I’m awake at 4AM. Pity there’s not more xtians who feel this way yet they seem to have no problems whatsoever with the evil they say & do. Morality comes from the conscience if you have one and not some god let alone a stupid book…
Engineers ? Hope that was a stab of sarcasm . Engineers are arrogant fools who design without EVER talking to the men in the field . EVER !! Engineers ,FAIL !!
Dear Bill;
You win the prize! I have personally suffered the scorn and condescension of ‘Engineers’ when pointing out errors on the sacrosanct plans of Commercial construction jobs. Not a blanket condemnation by any means, but the field end of engineering work seems to bring out the worst in people. When Plan C fails, going to the engineer is always slated after going to the Foreman, and, if that fails, the Job Superintendant, the fallback position is to get together with the people who have to actually do the work, and finagle. The usual fail scenario in this playlet is that you, the “bearer of evil tidings,” are fobbed off, or outright ignored as being too lowly to be of any importance. This is where the institutional arrogance of bureaucracies can lead to actual, physical consequences. For a much more erudite explanation of this phenomenon, I usually point people to Feynmans’ Appendix to the Challenger Accident Report.
One counter arguement I can think of is that, as one climbs the Pyramid of Power in any organization, one of necessity becomes a Politician to manage the Human aspect of the job. Is there a good example of Engineer Politician in our recent past? Oh, wait, yes there are: Herbert Hoover and Jimmy Carter. Blast!
I agree. I blame the division, not the specialization, of labor. It’s like keeping theory and praxis separate.
“Even as Germans demand cuts in social spending, German leader Angela Merkel isn’t calling for the Greeks to cut defense spending, because Germany sells Greece lots of weapons. ”
The U.S. sells even more.
“From 2002 to 2006, Greece was the world’s fourth biggest importer of conventional weapons. It is now the 10th.
“As a proportion of GDP, Greece spends twice as much as any other EU member on defence,” said Papadimoulis, who is also a former MEP. ”
http://www.guardian.co.uk/world/2012/apr/19/greece-military-spending-debt-crisis
“As a proportion of GDP, Greece spends twice as much as any other EU member on defence,”
Just curious. What are they defending against? Germans, Italians, and Turks?
They Greek Army will be defending itself against the men, women and children of Greece.
They are defending Defense Contractor profits, after first defending Banksters with austerity.
Part of the EU/IMF loan conditions include a reduction of (50% I believe) spending on defence.
That’s an easy one : they are getting ready for a coup d’etat and a right-wing military dictatiorship, in case the inclination to the left goes too far.
It (military coup) has happened before in Greece. I’m not sure it will be tolerated again. If Greece can eliminate its isolation and link up with neighboring countries it definitely won’t be tolerated….
And Angela is a nuclear engineer who is pushing Greece to buy German-made weaponry. As is Goldman Sachs a purveyor of the products of death, except that it is pushing Greece to buy American-made stuff. And now comes Tsipras who is an educated, rational Greek, maybe not in the military faction – then again maybe – but what he wants is to forgive the debt and stay in the EU. One solution would be to demilitarize the entire planet. And forgive all the foolish debt incurred promoting militarism. It was a lost cause but it had a certain momentum coming out of WW2. And that is why old politics like Golden Dawn (Apollo will save us) have resurfaced. But that burial is for another day. And an accounting that clears a 50-year balance sheet of extortion and fear is what we now need.
When the traditional parties sell out the people, there is a populist backlash which naturally finds its expression in the “extremes”, that is outside the spectrum defined by the traditional parties. The responsibility for these shifts rests squarely on the traditional parties and their leaderships in betraying those they were supposed to represent.
Good for the Greeks. The “main” parties were falling on their faces, so they threw them out and gave someone else a try.
As for the rise of fascism, corporate control of government is the main signifier, so they were practically there even before Golden Dawn gained any seats. People killed by thugs or people killed by job loss in austerity…what’s the difference?
NakedCapitalism consistently supports the idea that governments can manage economies for a net positive effect.
Where is the evidence for this idea?
The entire world is dropping into a Greater Depression. The entire world that has adopted Keynesian policies and Central Bank economic structures is deeply in debt and will default on the national, state, local debts either by not paying or by devaling the currencies.
The entire world is using the CB to move tax monies or created monies into the pockets of the very wealthy.
Have none of you compassion for the poor that you support such policies? Those are the people who are being devastated by the results of Progressive policies.
or by devaling the currencies. George
There’s a 3rd way: Ban any further credit creation and dispense new fiat to the entire population equally, including non-debtors, at a rate just equal to the rate existing credit is paid off. Since the total money supply (reserves + credit) would not change then neither price deflation nor price inflation should be expected.
George,
You might want to read Yves book Econned, and maybe even try reading Keynes himself before you start bandying about the term “Keynesian Policies”.
What we’ve seen from these Neo-Liberal & Neo-Classical bastards in charge for the last 40 years bears no resemblance to Keynes. They took the name, bastardized it beyond recognition and stuffed it full of the old neo-classical BS that ruined the world in the early 1900’s. What is called Keynes today is not Keynesian.
Luckily there were a few people around who remembered that you can stave a depression off with some stimulus. They did too little, and mostly late, stimulus right at the moment of crisis which has let the US muddle through til now. Unfortunately the “Austerity Ghouls” and there ilk immediately went back to form and started demanding austerity. Or like yourself claiming that Keynesianism had failed or had caused the crisis.
It is not progressive policies that have caused the problem. If goverments and bankers around the world were following the policies advocated by NC or MMT or Keynes we would be coming out of the crisis and things would be looking up for the common man.
It is Neo-Liberal and Neo-Classical policies that have ruined the world. And in Europe a lack of understanding of the Soft Currency Monetary system and flawed design of the EMU.
Lots of assertions, no actual data supplied to what should have been a softball question.
Most-to-all of the supposed effects of the stimulus have been produced by our gov fudging the data.
“Lots of assertions, no actual data supplied to what should have been a softball question.”
Yup, that’s your style all right. Thanks for tacitly admitting you are a Pete Peterson dupe! (See also: http://www.huffingtonpost.com/2012/05/15/peter-peterson-foundation-half-billion-social-security-cuts_n_1517805.html and http://fdlaction.firedoglake.com/2012/05/22/almost-no-regular-americans-rank-deficit-as-their-top-issue/ )
Go look up what happened when FDR fell for the austerity bozos in 1937 — by doing so, he nearly threw the nation back into depression in 1938: http://www.huffingtonpost.com/2008/11/17/paul-krugman-schools-geor_n_144298.html
More proof that austerity kills: http://rabble.ca/blogs/bloggers/progressive-economics-forum/2011/10/austerity-kills-conservative-cure-worst-thing-wha
>> The entire world that has adopted Keynesian policies
The term you’re looking for is “Reaganism”.
Keynes said governments should save during times of economic growth. Reagan increased our deficits even during economic growth. Thus, world history looks more like Reagan and less like Keynes.
According to Steve Keen even a reduction in the rate of new credit creation will cause a recession so maybe Reagan had it more correct than Keynes.
Anyway, it should be obvious that banking has to go. It can’t be made to work properly.
>> According to Steve Keen even a reduction in the rate of new credit creation will cause a recession
Recessions don’t have to be bad. Do they? We could use some contraction in MIC and FIRE. Lay off some workers there and then make them available to other industries, like health care. Can’t quants look for cures? (New non-profit: “Quants for the Cure!”)
Remember the “Peace Dividend”? Yeah, there are appropriate ways *and times* to cut credit creation. *During a bubble*, cut back on the dying industries.
For political reasons, this never happens.
>> Where is the evidence for this idea?
Look up the genesis or success stories of highways, the internet, Apple’s Siri, Google, Intel, Oracle, IBM. Government pays for a lot of innovation.
Of course, the government wastes a lot of money, too. I, for one, deplore the senseless bomb-building and, worse, bomb-dropping.
>> Have none of you compassion for the poor that you support such policies? Those are the people who are being devastated by the results of Progressive policies.
It seems to me you’ve been reading this site either sporadically or incorrectly.
Visit Cuba and you’ll see the evidence: Cuba + devastating hurricane = nobody dies, reconstruction for the people and by the people; USA + Katrina = you know well; Japan + Fukushima = you don’t even dare to know!
Of course it’s not just disaster-prevention and reaction but nearly everything that affects the common citizen: housing, food, healthcare, etc.
It’s not perfect and I am critical of many aspects of the Cuban regime (specially that it’s a bit stagnant) but it’s much better than the alternative, be it Haiti, Mexico or the Bronx.
I’m a Dutch taxpayer and didn’t vote for any Greek politician. Why should they decide how my money will be spent? What happened to no taxation without representation?
As long as the Greeks can blackmail us by threatening armageddon by mismanagent why should they improve?
“Why should they decide how my money will be spent? What happened to no taxation without representation?”
YOU should have thought of that before voting away YOUR Sovereignty.
In good times, everyone was a European. In bad times, everyone reverts to being Dutch, Greek, German, etc. That’s the whole problem right there.
Hugh-Nail-Head
Id like to see this idea elaborated on in some kind of Euro pre-post-mortem.
It’s my understanding that in many countries multiple votes had to be held until the “right” result came in. And that was to OK a monetary union.
A fiscal union, even 10 years ago, was VERY unpopular in every country.
Consequently, Betty (the Dutch taxpayer) has never voted for a project in which she sends her tax dollars to the South.
Of course, many in Brussels couldn’t care less what people voted for or against. To them democracy is an inconvenience.
“Of course, many in Brussels couldn’t care less what people voted for or against. To them democracy is an inconvenience.”
In Washington D.C. and every state capitol of the U.S. also.
Let’s show the man a lesson and fork over your money.
Even better, let’s set up a nakedcapitalism fund where all Marxist can cooperate for bailing out Greece. This will show us how good all of you are.
Dear Mole;
(Is there an accent on the “e” in your nom de byte?)
Your idea is reasonable in a perverse way. All the Billionairs Club Facist types have been contributing to many interlinked Destroy Democracy Clubs for a long time now. Look at what they have achieved! Also, your concept of what constitutes Marxist thought needs to be brought up to date. Sorry to tell you, but your socio-political constructs most closely resemble the ideas of Tallyrand and Richelieu. Cheers.
You ain’t dutch, and you grudgingly pay your taxes.
Nice troll.
We had the same problem in the UK with total equity swaps allowing companies and individuals to avoid tax on dividend payments. Tax law was changed and UK dealers were shafted to the tune of $1billion. So maybe you should blame your tax laws first…
You’re Dutch? Oh, good! Hey, I’m a US taxpayer. Why are you and Ireland provide a conduit for US companies to evade taxes in our country? Don’t you know that shifts the burden onto us citizens? ;-)
Betty, I’m a Greek taxpayer, and I wholeheartedly agree with you. And that’s why I voted for the left. We didn’t want your money. The bailout programs, and now the PSI, have been used to bail out banks both here in Greece (which are practically insolvent) and in Europe (where a lot of them are approaching that point). A lot of good money has been thrown after bad, and we’ve come to a point where we as a country cannot just keep up with this program. So, in very simple terms, what we want is this to stop, everyone to consider the alternatives, and just find a solution where we get to start making some money, so you can eventually get yours back.
A great (or rather sad) example of the systemic corruption and collusion between banks and the bipartisan party system here in Greece is Piraeus bank. Salas, its CEO, was taking loans form “his” bank, bought real estate, and then rented it to “his” bank, or even sold it back, via third parties, for up to 160% profit! Such practices led the bank into the red, yet it was bailed out with 1bn euros, which was orchestrated by the current leader of the centre-left PASOK, Venizelos, who was then financial minister. Further more, before those shady details were starting to emerge, they were even considering merging Piraeus Bank with Postal Bank, a partially state bank, which is the only bank in Greece which has a healthy leverage ratio, and the Agricultural bank, a state owned bank, which, via its issued loans, could essentially control the whole agricultural sector of the country.
Obviously this cannot go on. And, in an ironic twist of fate, the Left is the only viable alternative. Perhaps they’ll fail, but at least they have some good proposals and the will to try them.
Apologies for the long post.
The low yields for Greek borrowing were a product of its ascendancy to the Euro, which allowed it to issue debt at low rates as it was backed by the fiscal soundness of the Eurozone as a whole. G Papandreou blew the doors of the Greek debt market by revealing that Greece had been massively fiscally irresponsible. Bond spreads spiked leading to a debt crisis.
The way I see it, Greece was happy to accept low-yield debt when there were no strings attached, but is balking at the prospect of having to change its fiscal environment to receive money to keep it afloat. Pre-2009, Greece was issuing debt based on lies, not the soundness of its economy.
Dear Jim;
Please don’t continue to make the mistake of confusing the “Greek People” with the “Greek Elites.” The Elites were just fine with the bailout provisions when times were reasonably good. Now they want to shift the burden of payments for the financial disaster, primarily of their making, from themselves, onto the backs of the Greek populace as a whole. As I once sarcastically opined after a former employer refused pay raises, citing the need for fiscal prudence, all the while using company workers and materials to renovate his pool deck and cabana, “when’s the last time the boss asked me to go swimming?”
Nuff said.
It’s not “her” money. Plus the Dutch work the less hours of all Europeans (nice but less complaining) and the Greeks among the most (http://forwhatwearetheywillbe.blogspot.com.es/2012/02/who-works-how-much-in-eu.html) but for several historical reasons Dutch are being paid with what is being plundered all around the World, including in Greece now.
But the Netherlands is also collapsing in spite of it all: this yearly growth has been -1.3% (http://www.macrobusiness.com.au/2012/05/europes-growth-gulf/). Not as bad as in Greece, whose economy is being systematically demolished, but very bad in any case.
Now (or very soon) the Netherlands will need solidarity from the rest of Europe (actually we all need a good deal of solidarity from each other: alone we are nothing, together we can still do great things) because in spite of all the benefits obtained, in the end the too high value of the euro is a nightmare for all (we can’t export at such high prices, no matter what we do).
While the Greek and each individual case have their peculiarities, the real problem is a problem of how EU and the euro are designed: we need a lower euro: less imports and more exports (or internal consumption within EU of what is produced in EU), we also need to force Britain and the rest to stay tightly in the EMU (or leave EU altogether) because they are getting very unfair advantages by having their own free-floating (effectively dumped) currencies.
Alternatively we need a central planned economy… Guess that not yet, but some serious planning is needed anyhow: more pragmatic (and democratic) planning and less monetarist dogma is what we need.
“Owe $100,000, the bank rules you. Owe $100B you rule the bank.”
It should be noted that Greece had a coup in 1967 where the army took over, kicked the king out and ruled until 1974. Interestingly of course it also had a post WWII civil war that lasted until 1949. So 36 years is not a long time to be a democracy.
It’s also interesting to note that Greece had a constitutional monarchy with free elections and stuff from 1949 to 1967. So those kwazy Gweeks aren’t quite as inexperienced with democracy as some of us might think. Interestingly, they also invented that particular form of government.
Finally, someone has focused on the defense spending angle.
It’s not just the banks that need bailouts, but all those poor folks employed at Euro and US defense contractors.
Why did the Greeks need so much weaponry in the first place?
How do those national assets get privatized?
It’s never about “need” it’s about corruption. The Greek people would prefer the money not go to weapons systems, but they don’t get favors, bribes and kickbacks from the enourmous profts to be had in weapons. And where there is expensive weapons there are banksters.
In the USA, we’ll spend 650 Billion for our military (minus black budgets) while people are unemployed and being tossed out of their houses. The security state is in hyper-drive mode, and weapons are so profitable we basically have politician salesman. It is an unbelievable tragedy.
>> Why did the Greeks need so much weaponry in the first place?
There is some friction between Turkey and Greece. AFAIK, Greece lives *somewhat* in fear of its neighbor. (There are some “events” within the past 15 years. But, I’m too lazy to look them up. You never hear about them in this country, of course, unless you look for them.)
The US seems to consider Turkey — not Greece — to be strategically important. Thus, Turkey is “on a longer leash” and can be belligerent (if it wants to) with less risk of consequence.
Both sides fake it, both enrich themselves and their corps at the expense of their citizens. What – you think borders matter to ‘capital’?
And so reading this piece one would get the impression
the elites who brought the immigrants in to undercut ethnic Greek wages play no part in the problem, nor do the immigrants, many of whom must have known who was pulling the strings and took the chance.
I guess it’s that old American multicultural sine qua non left speaking wherein ethnic unity and pride is beyond the pale.
>> Greece has a large, untouchable patronage system, a big defense sector, wealthy who escape from taxation – and yet international bankers are demanding radical cuts in wages, pensions, and jobs for honest workers.
We’re all Greece now!
Here we have further mention of Greece’s big defense budget–an earlier piece (or a comment) here suggested that members of the country’s two biggest parties were both in the pockets of German defense contractors–hence their willingness to pay obeisance to Merkel. Anything to all this? Anyone who can put this picture together for us, if indeed it wants scrutiny?
By the moment polls show that the Nazis and the “Independent Greeks” are going back to their holes in the benefit of Nea Demokratia, who are successfully rallying the Right back to the rooster (but not enough to beat SYRIZA, it seems).
The turd-o-führer’s infamous party of the golden something has collapsed in voters’ intention to barely 3.7-4.5%. The trend is so marked (-2.5 to -3.2 points in just two weeks) that I imagine that they will struggle to remain in parliament after June’s elections, as they need a 3%.
ANEL (“Independent Greeks”) has also lost voting intention at a similar rhythm, from 10.6% and a fourth position in the last elections to just 7.2-8.0%. They seem more consolidated than the turd-o-führer but they are rather giving voters back to ND and clearly not growing.
On the other hand SYRIZA has grown from a 16.8% in the ballot to as much as 28% (!!!) in an opinion poll two days ago. This is clearly a peak but indicates a possible outcome, as SYRIZA led all polls since elections except one.
ND shows some sings of recovery but not enough to defeat SYRIZA probably. However if ND wins this time, because of the decissive effect of the 50 extra seats for leading party, ND-PASOK will probably have sufficient seats to rule together as they did the last many months… at the service of the Troika.
Hope not. We already know how bad is that for Greece and for ell Europe.
But if SYRIZA wins and does not get a clear mandate (alone or together with DIMAR), then forming a government will be almost impossible. The KKE is adamant of not taking part in any such government (what means that they have seen their voting base cut almost by half, according to polls, but still get some 5%) and making a coalition with PASOK, a bourgeois liberal party in spite of the name, as we have confirmed in the last two years, will be extremely difficult if it has to be in SYRIZA’s terms.
But it’s not the Nazis or the Reds. Nope, not yet at least. There’s no such strong Nazi support in Greece in the end, the most left-leaning country-cum-state of Europe (even before the crisis). It’s the Reds (fresh hope) vs. the tyranny of banksters (ND-PASOK).
I’d bet that a large proportion of Golden Dawn voters are moving to Syriza instead of to ND, as the reasoning would be to strenghten the useful anti-troika vote.
Right now the Greeks are scared. It doesn’t have to go Fascist or Communist, but the leaders need to understand what’s in Greece’s interest is not necessarily in Europe’s best interest and leaving the Euro as painful as it will be..may be less painful than staying in.
So what are they giving up, well , Euro’s held in banks will be involuntarily exchange for a new dracha with less purchasing power, and inflation will shoot up as a result of more expensive imports, but they will have a cost advantage with regards to exports and tourism, and that beats taxing the country at 80% and draconian spending cuts.
Tax the 1% at 95%.
good. but why stop at 95?
Tax the 1% at 99%
Yes, the punishment for Rich Americans aimed now at Greeks. Solutions are more often generated from ones own ideologies and not out of pragmatism.
Dear CoC;
Indeed, remember Eisenhowers Tax Rates? America did very well under that regieme. By the way, those taxes were to pay for WWII, wherin America mobilized to save the Capitalist System from Evil Totalitarian Facism. Then there was the Cold War, where the Military Industrial Complex geared up to ‘save’ us from Evil Red Communism. When the ‘wall came down,’ we discovered the existential threat of Evil Jihadist Terrorism. The military system geared up yet again. Do we detect a pattern here? Now the public face of Jihadism has been wiped off the face of the Earth. What “Threat” will be ‘discovered’ next?
Watch this space.
Nobody will exit the euro. Even if suspended, Greece will probably keep using the euro, just like nearby Kosovo or Montenegro do.
However smaller or weaker states like Greece may (certainly should) become more assertive on how the BCE and the euro relative value is managed. This euro does not benefits Europeans as whole nor helps to keep the European economy afloat.
They may also become more assertive on nationalization of banks and other strategic companies for the sake of the economy.
Hey, want some austerity? How bout NATO denunciation and exit under Article 13 of the North Atlantic Treaty? Saves big bucks.
http://www.zcommunications.org/message-from-syriza-to-chicago-anti-nato-protests-by-antonis-davanellos
We’ve seen it all before. The Warsaw Pact collapsed before the Soviet Union did. Now it’s the US satellites’ turn and the US is panicking. That’s why, if the United States has anything to say about it, Greece will get Neo-Nazis and not leftists. Hollande knows what’s at stake. Turkey knows what’s at stake. The European left understands: one integrated Europe, or a dozen isolated US banana republics with puppet rulers and death squads?
Turkey has been warning NATO that NATO had better start acting like an actual alliance rather than a US puppet show. The US has been resisting.
Should be interesting to watch NATO collapse.
Dear Nathanael;
My question is; collapse into what? Whatever the rump of NATO turns out to be, it will still be a very powerful military presence. Who will control it, if not the U.S.? Germany?
It’ll just evaporate, like the Warsaw Pact.
NATO’s central command organization will be disbanded.
NATO doesn’t *own* anything to speak of; it’s all owned by individual countries (mostly the US). There will probably be a bunch of bilateral agreements hammered out.
From Immanuel Wallerstein’s
European Elections: Is the Center Holding?
http://www.iwallerstein.com/european-elections-center-holding/
‘”The Germans are now under enormous pressure. There is internal discontent leading to electoral losses by Chancellor Merkel’s party, the CDU, and its neoliberal coalition partner, the FDP. The other social-democratic parties in Europe have been encouraged by Hollande’s victory to move somewhat leftward. The two conservative parties in the Italian government coalition have both suffered severe losses in the May municipal elections. There is also, strangely but importantly, pressure by the United States on Germany to move in the direction that Hollande is advocating.
The Germans might resist all of this – until May 31, the date of the Irish referendum. The Irish government was the only member of the Eurozone that made its agreement to the new austerity treaty on which Merkel had insisted, with the support of Sarkozy, contingent on a referendum. The polls had been showing that it was a close call, but the Irish government had felt confident it could win a yes vote. Hollande’s victory may now shift enough voters so that the Irish vote is negative, in which case the austerity treaty is void. This will undermine the German position far more than the Greek repudiation of the center.
What will happen then? The key is what happens in German political life. Angela Merkel, like any good political leader, tries to see which way the wind is blowing. Her language is therefore already beginning to evolve. She may even secretly welcome the outside pressure to do what, from Germany’s own narrow point of view, is the sensible thing, and shore up purchasing power (for German goods, among other things) in the rest of the European Union.”‘
If you think Golden Dawn is troublesome, take a look at Hungary’s neo-Nazi Jobbik Party, which in addition to advocating for ethnic purity aslo has expansionist ambitions beyond Hungary’s current borders. Polling puts them at about 20% there, and they also have an organized (but illegal) paramilitary force numbering in the thousands.
Of course, the more “respectable” right-wing party in Hungary, Fidesz, has abolished judicial independence and the rule of law, gerrymandered the elections, taken control over nearly all of the media, and rewritten the Constitution for its own benefit. It’s being investigated by the European institutions because it appears to have suspended democracy.
Hungary is indeed in trouble.
Yes to both: Hungary has “evolved” so quickly into a fascist regime that it should not be in EU but hasn’t been but slightly frowned upon.
While we should not lower the guard, the Greek case is completely different: a bout of slightly increased fascist vote (most Nazi votes are from the Christian-Fascist LAOS, collapsing like the other Troika puppets) that looks like quickly vanishing, at least for the time being.
There is some worrisome institutional fascism however: the ND-PASOK government had some ex-LAOS Fascist ministers and has acted quite Nazi-like against immigrants, even opening a concentration camp in the outskirts of Athens and allowing police and fascist gangs to attack immigrants at will. Police agents are like 50% voting Nazi (they vote in special polling stations and has been estimated that they vote that way) and that requires a radical purge, more so as it is not “just voting” but they have been supporting actively illegal anti-immigrant raids by Nazi thug gangs and similar abuses.
The most worrisome aspect of the Golden Dawn vote is how the police voted. In the poll stations near the Athens General Security Administration (GADA) and the Riot Police (MAT) headquarters, GD got 20%. Comparing those results to the other poll stations in the same districts, where only civilians voted, it’s been deduced that up to 40%, and in some cases 50%, of police officers voted for GD…
It is a great concern how the state apparatus will react to a left government.
That police officers are more facistic than the genera pop. comes as no surprise.
They like to wear uniforms and boots and beat up people.
So nothing specially worrisome there.
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Funny, even the Neo-Nazis are to the left of the GOP on policy
Not necessarily: they say A and when they reach power they do B. In Spain in the 1930s, Falange (1 MP) complained for the gallery that the agrarian reform was too slow, blah, blah. When they reached power they totally stopped it.
Fascists speak “socialist” but do the Capitalists dirty jobs. Don’t believe a word of what they say, remember how Goebbels (and others) manipulated public opinion with hammering of populist lies and vicious slogans.
Can you or anyone on the board explain what a fascist is?
Basically, fascism is socialism for the rich, banks, and big business.
A gold standard is fascist because it places the power of government money creation in private hands thus requiring government to buy or borrow gold from the private sector in order to create government money.
Thanks Beard!
What is the purpose of a currency?
The purpose of government money is to be the only means of paying taxes.
The purpose of private money is for the payment of private debts only.
So a government can live without the private sector than?
It could, not very well, but it could.
But who’s advocating that?
Not me.
Aren’t you advocating for government money and private money?
Or is currency a little more than simply a method of paying taxes?
Government money could be voluntarily used for private debts too and it would be if managed properly.
As for private money, since it would be useless for government debts, it would have to offer real value to compete against other private monies and against government money.
Who would manage private money and whodunit would manage public money?
The private sector would manage private monies (duh!) and the public sector would manage government money.
Gotcha..
And you believe that a currency whose sole purpose is for paying taxes would survive?
I would think privates will use private currency for all business transactions – don’t you think?
And you believe that a currency whose sole purpose is for paying taxes would survive? Mole
Of course, so long as taxes are required to be paid with it!
I can easily see this scenario be more beneficial to corporates ethnic today’s arrangement. Corporates will use as much private currency as possible, save in private currency while paying taxes in cheaper and cheaper government money. The value of government money will devalue so quickly, taxes would have to be raised daily.
I actually like this deal as I will move my savings to private money and will pay cheaper and cheaper taxes. The private sector can back the currency with a metal that has been proven to be effective. When can we start this? Seriously.
The value of government money will devalue so quickly, taxes would have to be raised daily. Mole
Not if government quit wasting its fiat propping up the banks!
But I’m glad to see you are finally beginning to understand. BTW, you would be in for a surprise as you learn from experience that metal-based private monies are pretty dumb.
Fascism is the control of the masses by means of hierarchical organization and propaganda. In other words: the methods of the Catholic Church (or similar) made into a nationalist secular regime.
Ideologically it is at the same time extremist-conservative (reactionary), praising whatever charismatic and authoritarian from old (Confucius, Napoleon, the Roman Empire…) or fantasy (Atlantis or Aryan race delusions) but innovative enough to accept elements of modernity such as imitating the socialist organization of mass movements (although IMO this belongs to the past).
It makes a poutpouurri of all it in order to reach power and retain it by means of a police state in which everything is affiliated with the single party, with the regime, by force, and very specially propaganda.
Have you read 1984? That is fascism!
Understtod.
But isn’t it easier if the government promises all, including equality to everyone? Wouldn’t that be easier than force?
Sure, Mole, it would be *easier*, but some people get their jollies mainly from making other people miserable, or from knowing that other people are worse off than them. (Most of us have a little of those antisocial desires, but for some people this is their driving goal. Such as Mitt Romney, a bully since the days of prep school.)
And fascism, the Catholic Church hierarchy, feudalism, monarchy, corporatism, predator capitalism, and many similar systems are all organized mainly to satsify these antisocial people in their desires to bully people.
@Mole: the system is not about promises but about facts and the facts of the system are exploitation, increasingly so. And factual brutal explotation requires of repression and violence, as well as propaganda (lies, promises, brainwashing) to sweeten the otherwise hyper-bitter pill.
You can’t exploit brutally only with words, you need violence, brutal violence. And even then… you may fail, so strong is the desire of humans for justice and freedom.
I didn’t realize you were a non-religious bunch.
I will say my opinion, it’s your choice to listen.
Presidents like Fidel Castro and Hugo Chavez are good salesmen. They can stand in front of their cameras with all these “great” things they are doing for their people, yet their people get killed for opening their mouths opposing the government. They promised riches for, yet their people live in poverty while they live in riches. That is the danger of your proposed government.
You want the government to procure, but note that what they provide comes from somewhere. Just like all poor people are not thieves, all rich are not thieves either and should not be penalized for working harder and saving more.
All in all, the middle class (not responsible) always pays, which is a sad state of affairs.
“…a country which until recently was a wealthy Western democracy with a relatively stable political system.”
Not sure I can completely agree with that evaluation of Greece.
We in the US are much more efficient than the Greeks. We don’t have to elect an extremist third party. We already have the Republicans!
What many people are not aware of is that Golden Dawn relies on Google blogger for free web hosting. Their previous host WordPress shut them down after they found out about the threats of violence coming from this dangerous group. There is a petition here to get Google to do the same: http://www.change.org/petitions/google-suspend-the-official-greek-nazi-party-blogs-on-blogger
GD is a left wing movement. Unlike what we call “leftist” it is a conservative left wing group.
Mises/Hayek pointed this out decades ago. Leftism itself falls to ultra-nationalism and occultism due to the tribal urges. It is why Marxism ended a intellectual failure. It did not represent what ‘socialism’ was truly invented for: a reactionary rebellion against the enlightment and devolution.
Your comments are appreciated.
Germany just ruled out Eurobond for Europe.
Somebody should kiss Germany goodbye.
http://www.youtube.com/watch?feature=player_embedded&v=_QZvJRI8CS4