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Introduction: Further developing material presented in FTR #746, this program details the horrifying developments unfolding in Greece. Being hailed as a “success,” due to its recent re-entry into the bond market, Greece is actually a cruel and depressing example of the long-standing strategy of German/Underground Reich geopolitics.
Realizing a strategy for German political domination of Europe and the world, the EU and EMU are direct manifestations of the strategy first advocated by Friedrich List in the 19th century.
List advocated a pan-European economic union–dominated by Germany–as a means to control first Europe and then the world. Implementing the List strategic doctrine through a series of military adventures and subsequent economic and political consolidation, Germany has utilized the concepts formulated by Prussian military theorist Carl von Clausewitz in order to do so.
Having originated the concept of “Total War,” von Clausewitz posited the fundamental importance of a “post-war” to successful realization of strategy.
In All Honorable Men, James Stewart Martin highlighted an important aspect of von Clausewitz’s philosophy, that war and diplomacy are two sides of the same coin. When diplomacy is no longer effective, the policy goal is pursued through the use of armed force. When war and military power have reached the limits of their effectiveness, diplomacy continues the pursuit of the goal.
Generations of Germans have understood this and incorporated that concept into the methodology of German power structure.
. . . . The end of battle in 1945 had signaled the start of a new kind of war–a post-war. Germany’s classical military theorist, von Clausewitz, is famous for having declared that “war is the continuation of diplomacy by other means.” In dealing with a Germany which had gone to school with von Clausewitz for generations, we knew that, conversely, a post-war is the continuation of war by other means. Since Bismarck, wars and post-wars have formed a continuous series, changing the quality of the events only slightly from year to year, with no such thing as a clear distinction between heat of battle and calm of peace. This post-war of the German occupation was different from the “cold war” between the United States and Russia, which broke out at about the same time. The latter complicated the diagnosis, like a man getting typhoid fever and pneumonia at the same time. . . .
Having inflicted enormous damage on the infrastructure and populations of Europe and having appropriated the liquid capital of those countries and secreted it into the Bormann flight capital network, German corporate structure cemented their control over the remaining wealth of the continent through licensing agreements and corporate alliances.
Not conceptualized as an economic theorist, von Clausewitz’s doctrines of “total war” and “post-war” apply directly to the political/economic domination of Europe by Germany.
Greece is but one example of that policy, albeit one of the most salient and shocking. We present what has been done to Greece as representative of “Clausewitzian economics.”
Program Highlights Include:
- The installation by the Troika (read “Germany”) of the Greek neo-Nazi LAOS party as part of the provisional Greek government created to impose “austerity” on the unwilling Greek populace. Note that the citizens of Greece–the cradle of democracy–had no input in this!
- Greek insistence that Germany pay back the billions it stole during World War II–this flight capital is part of the Bormann organization about which we speak so often.
- STERN’s claim that Greece is owed some 300 billion euros from the war.
- The Greek population’s support for the payment of reparations by Germany.
- The fact that the “bailouts” being provided to Greece are being used to repay the banks–many of them German–that are creditors of that unfortunate nation. The bailouts are NOT going to the Greek citizenry themselves.
- Germany’s own deliberate default on debt owed on bond issues that helped re-build its economy after World War I.
- Charges by a Greek analyst that Germany deliberately inflated Greece’s debt, leading to “a new kind of occupation.”
- Recounting of the brutal reality of the “austerity” (i.e. Clausewitzian economic reality) imposed in Greece, including: the fact that Greek physical education teachers no longer require their students to participate, because so many of them are too underfed to exercise properly; the necessity for Greeks entering hospitals to bring their own sheets and pillowcases due to budget slashing; the inability of Greeks to bury their dead, due to impoverishment.
- A recapitulation of the incremental German implementation of List’s theories through the Clausewitzian “continuation of war by other means”: the German geopolitical strategy during World War I; the German strategy in 1940; the German postwar plans in 1942; the German geopolitical strategy in 1945.
- Analysis of German strategy toward the EU as being analogous to the occupation of Poland during World War II.
- Analysis of German strategy by a former vice-chariman of Moody’s, who said that modern Germany is doing the same thing as the Third Reich.
- A highly controversial Greek proposal to solve the youth unemployment problem (between 55 and 60 percent) by implementing what is, essentially, a form of slavery.
- In an update, we learn that former LAOS part member and doctrinaire fascist Makis Voridis has been appointed Health Minister.
1. We begin by noting that the provisional Greek “austerity” government includes the Greek neo-Nazi LAOS party, installed with no input whatsoever from the population of “the cradle of democracy.”
. . . Recently, a rightwing extremist party was again made a direct coalition partner in a country’s government — in Greece. The newly installed transitional government — imposed under the supervision of Berlin and Brussels — includes not only the conservative and social democratic parties but also the LAOS Party (Laikós Orthódoxos Synagermés, “Orthodox People’s Alarm”). The LAOS Party musters also partisans of the former military dictatorship and is known for its racist and anti-Semitic invectives. Giorgos Karatzaferis, LAOS Party Chairperson, is quoted to have proclaimed that he is proud “not to be Jewish, homosexual and communist,” which “only few can claim.“[5] He is said to have called out to the Israeli ambassador: “Jew ambassador, watch out where you tread! Let’s discuss the Holocaust, let’s talk about all the fairy tales about Auschwitz and Dachau.“[6] Makis Voridis, a member of the LAOS Party and minister of transportation in the Greek government, imposed by Berlin and Brussels, began his political career as the leader of a youth organization of the party presided over by Georgios Papadopoulos. Papadopoulos had been the military commander of the junta. He founded that party after he had been released from prison, in the aftermath of the overthrow of his dictatorship. The German government evidently considers the LAOS Party helpful for implementing its austerity dictate. . . .
2a. The first of several articles notes that the issue of German war reparations owed to Greece has come back into focus in connection with the austerity package imposed by the Troika.
Note that, according to Albrecht Ritschl, Germany is the greatest debt transgressor in the world, as a result of World War Two debts.
“Protectorate-Like”; german-foreign-policy.com; 2/13/2012.
Last night, under strong popular protests, the Greek parliament accepted the latest “austerity package,” that the German government had promoted in the form of an ultimatum. This “austerity package” will lead to a 20 percent cut in private revenue and the minimum wage, therefore also in the public sector wages, which are dependent on the minimum wage. One hundred fifty thousand government employees will be laid off. Criticism of Berlin has become sharper because of its efforts to transform Athens into a de facto EU finance protectorate, using so-called austerity commissioners. Demonstrators burned German flags; Greek parliamentarians have announced an initiative to remind that German World War II reparations are still outstanding. Since 1945, the Federal Republic of Germany has consistently refused not only to pay reparations, but also Nazi debts, even those undisputed by the German Reichsbank at the end of the war. These would amount to more than three billion Euros today. But, the debate continues in the German capital about the suspension of democracy in Greece.
Protests against Berlin
Berlin’s brutal austerity dictate and the German media’s on-going rabble-rousing anti-Greek (“bankrupt Greeks”) propaganda has enflamed Greek protests against Germany for quite some time. Last summer, Greek demonstrators chanted “Germany out of the EU!”, and displayed “Merkel = Nazi” banners at rallies. EU flags with a swastika in the center were occasionally seen. The memory that this is not the first time that Berlin has dictated Athens’s policies, has recently been accompanied by references to Nazi rule in occupied Europe. Last week demonstrators outside of the Greek parliamentary building again chanted “Nazis Out!” while burning a German flag. Trade unionists also occupied the Athenian offices used by the German Horst Reichenbach and his “task force Greece,” monitoring Athens’s austerity measures, in the name of the EU Commission. These protests against Berlin’s hegemonic dictate are defamed in the German media simply as “anti-German propaganda.”
Old Debts
A few days ago, a group of twenty-eight Greek parliamentarians, from various parties, reacted to Berlin’s persistent pressure by tabling a resolution, calling on the parliament to debate Nazi Germany’s plunder of Greece, which has never received indemnities. The indemnities not only refer to reparations in general, but also to the compulsory loans to the Reichsbank’s clearing account. Shortly before the end of World War II, Nazi bankers were still in possession of Greek assets worth 476 million Reichsmark, which has never been repaid by the Federal Republic of Germany. According to experts, this would today amount to 3.4 billion Euros with interests included. Greece is not the only country that has waived Germany’s old Nazi debts without receiving anything in return. As the economist Albrecht Ritschl, who teaches at the London School of Economics, confirmed, Nazi Germany’s unpaid debts to its wartime adversaries would today range between 700 billion and 1.4 trillion Euros with interests included, depending on the method of calculation.[1] This does not even include the reparations for war damages.
Debt Cancelation
Because of the Federal Republic of Germany’s longstanding policy of refusal, even totally indisputable Nazi debts have never been paid. Bonn scored a decisive success in 1953 with the so-called London Debt Agreement, achieving a gigantic debt cancelation, in the framework of which Greece also waived its former occupier’s enormous debts. That agreement permitted the Federal Republic of Germany the expunction of enormous debts, created both before and since World War II. The agreement also stipulated that the question of the payment of Nazi debts and reparations would first be solved with a peace treaty concluded with a “reunited” Germany. [The Federal Republic of] “Germany has been in a very good position ever since, even as other Europeans were forced to endure the burdens of World War II and the consequences of the German occupation,” says the economist Ritschl. This has made the resurgence of the “greatest debt transgressor of the 20th Century,” namely, Germany, possible.[2] . . . .
2b. According to STERN magazine, Germany owes Greece the equivalent of 300 billion Euros from World War II.
The weekly German “Stern” magazine this week dedicated one of its columns to the issue of German war reparations to Greece, while it also at the same time notes that Berlin has only given Greece 37 million Euros to save the almighty Euro. The article said reveals that Greeks wish Germany would finally pay the war reparations because it believes Berlin owes much to the country for the damages and atrocities it caused during World War II.
The issue of war reparations appears regularly in Greek newspapers, claims the article, but notes that no such discussion (or claim) has been raised by both Athens and Berlin. The magazine also blasted the decision by the German government which said two weeks ago that the issue of war reparations to Greece has lost its meaning. A spokesman for the German Ministry of Foreign Affairs said that “the federation of German believes that after many decades, the issue of war reparations has lost its meaning.” The statement was made of course after Athens established a working group in order to study old documents and estimate the exact amount of the reparations.
“The fact is, the Greeks are among the nations that suffered the most under Nazi occupation. Their will to resist was fatal. First up was a legendary telegram that the Athens dictator General Metaxas sent in October 1940 to Fascist Italy — in response to Mussolini’s ultimatum to surrender. It contained the plain text “ochi” (no), which is why the Greeks celebrate to this day every October to “Ochi Day”. Shortly thereafter, the Italians attacked Greece and although numerically more superior, were totally pushed back behind the Albanian border.
Then Hitler sent his troops and was also met with massive opposition. When the Nazis finally triumphed, they set up a brutal occupation regime in order to show the world what can happen when small countries do not submit. In Crete, which was particularly competitive, an order was given that said that for every fallen Wehrmacht soldier, ten Cretans should die. (As a result) 30 island villages were destroyed. On the overall, more than 80,000 Greeks. or 7.2 percent of the population died between 1941–1944.”
The article then speaks about the “interest-free loan” to Hitler.
The fascists, claims the same article, attacked, pillaged and destroyed Greece’s industrial production equipment, crops, etc. Hitler, it adds, even forced the National Bank of Greece, to lend Germany interest-free money. The total amount “of these government bonds totaled 476 million Reichsmarks, which today corresponds to ten billion euros.”
The subject of war reparations was first negotiated in the autumn of 1945 in Paris. At the time, adds the same article, Greece was asking for ten billion US dollars, which was viewed by all conference participants to be a little over exaggerated, especially the US, so Greece was apparently awarded with 30,000 tons of German industrial goods with an estimated value of approximately US $25 million (or two billion euros at today’s rates). But, the same article writes “these products have never made it to Greece.” . . .
2c. Tagesspiegel maintains that the damage done to Greece “destroyed” the country.
“Tagesspiegel Says Nazis Destroyed Greece” by Maria Korologou; Greek Reporter [Europe]; 4/11/2013.
The classical liberal German newspaper Tagesspiegel, criticizing Germany’s refusal to pay more war reparations to Greece for World War II, said the Nazis did more damage there than in any other country.
Tagesspiegel catalogued the horror and suffering that Hitler’s forces brought to Greece: “130,000 civilians, women and children, were executed in retaliation for rebel attacks. 70,000 Jews were taken to concentration camps, 300,000 suffered frostbite and hunger, because the Germans confiscated food and fuel. Fifty percent of the country’s infrastructure and 75% of industry were destroyed”. . . .
. . . . The paper said that if Germany paid Greece what it is alleged to owe, it would dramatically improve Greece’s likelihood of overcoming its crushing economic crisis.
“The Greek government appears to pushes the issue away. After the conclusion of a group of experts on the topic, the Greek Ministry of Foreign Affairs will ask the opinion of the state’s law officials, in order for the decision to be postponed in every way,” it added.
2d. The Greek parliament has unanimously voted that Greece must ask Germany to pay war reparations.
For the first time in decades every single party in the Greek parliament is in unanimous agreement. Greece needs to formally ask Germany to pay back the money owed from the Second World War. This includes the war reparations as well as a forced occupation loan. A provocative statement made by German Finance Minister Wolfgang Schaeuble on Thursday noting that Greece should avoid the issue of war reparations and rather concentrate on reforms only ignited the flame which is now growing into a fire.
Schaeuble was referring to a top-secret report compiled at the behest of the Finance Ministry in Athens. Leaked by To Vima newspaper on Sunday, the report suggested that Germany owes Greece 162 billion euros in World War II reparations.
In essence, the political parties are urging the government to take the necessary legal steps to claim the 162 billion Euros (without the interest), that are due to Greece as a result of Nazi occupation and a forced war loan. (The 108 billion for Greece’s infrastructure and 54 billion for the forced loan).
Responding to Schaeuble’s statements, Foreign Minister Dimitris Avramopoulos said that the reforms being carried out in Greece bear no relation – and can bear no relation – to the issue of German reparations, adding that the Greek state has been raising the issue for many years.
“Whether this case has been resolved or not is determined by international justice, given that, by its nature, this issue concerns international law and the international justice organs,” Avramopoulos said.“Greece is not ‘losing its focus’ on the reform policy, despite the great sacrifices the Greek people are shouldering,” he added.
In comments made to Germany’s Neue Osnabrucker Zeitung newspaper, Schaeuble said the issue of war compensations has already been “settled.”
Meanwhile, the German Tagesspiegel newspaper, slammed the Berlin government’s stance on the issue noting that the Nazis did more damage in Greece than in any other country they occupied. The newspaper said that Hitler’s forces were responsible for the death of many men, women and children.
Specifically it said 70,000 Jews were taken to concentration camps, 300,000 suffered frostbite and hunger because the German forces confiscated all food and fuel, 50 percent of Greece’s infrastructure and 75 percent of the country’s industry were totally destroyed.
The issue of war reparations has been a contentious and legally complicated one for decades. Nazi Germany, which occupied Greece from 1941–44, forced Athens to extend it loans and give up gold reserves. There was also the question of the destruction of infrastructure and compensation claims filed by individuals who survived Nazi atrocities. As a result, Greece suffered greatly and unlike every other country Germany went to war with, only Greece has never been paid compensation. [This is not entirely correct. The former U.S.S.R. was never compensated either–D.E.]
Campaigners say the Paris Reparations Agreement of 1946 obliges Germany to pay Greece around billions of Euro.
There has long been a vociferous lobby calling for war reparations from Germany, with the so-called “National Council” calling for more than 500 billion Euros in war reparations (with interests), as well as the forced loan (with interest), but also for other commodities such as stolen art work and the loss of 50pc of economic output over almost four years. . . .
2e. The Greek citizenry is in agreement with that country’s parliament.
Eight out of 10 Greeks believe the government should pursue Germany over war reparations, following a classified report by the Greek Finance Ministry indicating the debt stands at €162 billion.
Ekathimerini reported almost 90 percent of Greeks consider damages should be sought. Last week Digital Journal reported leaked details of the classified report commissioned by the Greek government concluded “the outstanding debt is comprised of €108 billion for damage to infrastructure and €54 billion for the forced loans demanded by the Nazis.”
German Finance Minister Wolfgang Schaeuble responded to the issue of war reparations by dismissing the issue as already settled, saying: “I deem that such statements are irresponsible. Instead of misleading the people in Greece it would be better to show them the road to reforms.”
His words drew a strong response from Greek Foreign Minister Dimitris Avramopoulos who stated: “The reforms being carried out in Greece bear no relation – and can bear no relation – to the issue of German reparations. Whether this case has been resolved or not is determined by international justice, given that, by its nature, this issue concerns international law and the international justice organs.”
According to Hellas Frappe (which outlines the details of the reparations due) every single party in the Greek Parliament is in unanimous agreement that Greece should ask Germany to pay back the money owed.
DW [Deutsche Welle] reports German historian Hagen Fleischer argues the issue is not settled but believes Greece should focus on the forced occupation loan, estimated to be €7 billion without interest. Fleischer says that whilst Germany will not allow Greece to set a precedent over reparation demands, the loan should be pursued. . . .
2f. Note that Germany itself defaulted on the bonds it issued to revitalize its economy after World War II.
“Germany Defaults–and Lies about It;” Germany Watch; 4/17/2013.
. . . . It started in the 1920’s when Germany issued series of bearer bonds in the USA for revitalisation of its economy following the devastating effects of WWI. Acting as trustees, financial institutions such as JP Morgan and Lee Higgins & Co. produced and sold bonds in America raising funds that would be invested in Germany.
These bonds corresponded to Agricultural Loans signed by 14 German banks and guaranteed by the German government. Of these 14 banks four are still active and are part of the troika mechanism.
From 1933, Germany defaulted on interest repayments to Bondholders, as the new Nazi leadership considered the debt that Germany faced following WWI as illegal and issued a moratorium on bonds owed to foreign investors.
In 1953 following years of German debt crisis, the London Debt Agreement restructured Germany’s debt to be sustainable by the agreement of its creditors.
The way this deal would function was to provide the option to the bondholders of German debt, to either accept the repayment terms of the LDA, or to forego attempts to claim their debt until 1993. The rationale being, that you can cash in today from a weak Germany, or wait for a full settlement after 40 years of German growth and development.
Assenting Bondholders: For bondholders who wanted to cash in their bonds immediately, they could receive partial payment, and new bonds, with a discount on the value of their bonds (depending on the issue, between 20% — 60%). For this to be implemented correctly, a procedure of Validation was set up to ensure that anyone presenting bonds for payment, could prove that they were indeed the beneficial owner. This would guarantee that all of the disbursements paid went directly to Germany’s creditors in the correct manor.
Non Assenting Bondholders: For bondholders who chose to wait for full settlement by their next generation in the future, their course of action was to maintain the debt instruments (the bonds) safely, and not request a settlement until the 40-year grace period had expired.
Validation boards were established in the three US states (where the bonds were initially sold) to carry out the compliance requirements for the bondholders who chose to accept the option presented in the LDA. Having performed their role, these boards were subsequently closed a few years later.
By 1993 the German government had succeeded in revitalising its economy and began to respond to requests for payment. Unfortunately, they chose not to honour their debt. To the surprise of many bondholders, Germany would receive payment applications with the physical bonds attached, perforate the bonds, and stamp them as invalid.
The reasons given by the German Government and its subsidiary bodies are: Germany has compiled a list of Bond serial numbers that Germany considers stolen, and hence invalid. The procedure of validation must be complied with.
The German government claims that during WWII Russian soldiers looted the Reichsbank vault, where many bonds were kept, and that these bonds were reintroduced into the market for payment. The simple problem with this claim is that the only bonds that were in the German vault, had already been paid off or pledged, for which there is a public record, and no active bondholders had their bonds physically in Germany. Furthermore, the building which housed the Reichsbank had been completely destroyed, the contents of which had been removed by Germany before the arrival of Russian soldiers to Berlin.
The bonds were “bearer” instruments, and bondholders would cut off the coupons from the papers for their interest repayments. This claim however, was acceptable in the few years immediately following the war, as it was obvious bondholders would not be able to recover their principal or interest at the time, and was the reasons for the Validation Procedure outlined in the London Debt Agreements.
The so-called ‘Validation Procedure’ which was intended to apply to bonds that would be submitted for payment in 1953 added additional security requirements for the bondholder to comply with. Not only was it clear in the legislation that this only applied to Assenting Bondholders in 1953, subsequently indicated by the closure of the Validation boards, but it would be simply impossible for any bondholder to comply with them 40 years later.
When bondholders and creditors have asked to see this list, the German government categorically denied access, stating that it is not in their national interest, and has classified this list as a “national secret”.
What followed was a series of lawsuits in the US where German legal defence has never denied the liability for its debt, but has systematically used technical issues and delayed court cases, to the point that many bondholders have paid millions more in legal expenses. Many of these claims continue today, by some of the surviving bondholders, and the acquirers of that debt, and will be making appeals to the European Courts in the near future.
There is no question in the minds of the many experts in banking and law, with substantial knowledge of international financial instruments, that these bonds represent unpaid debt of the German government and its subsidiary bodies. . . .
3. The details of the agreement to which the Greeks are being subjected might be politely described as stunning. The country is being used as a vehicle for shoring up weakened European financial institutions!
Earlier today, we learned the first stunner of the Greek “bailout package”, which courtesy of some convoluted transmission mechanisms would result in some, potentially quite many, Greek workers actually paying to retain their jobs: i.e., negative salaries. Now, having looked at the Eurogroup’s statement on the Greek bailout, we find another very creative use of “negative” numbers. And by creative we mean absolutely shocking and scandalous. First, as a reminder, even before the current bailout mechanism was in place, Greece barely saw 20% of any actual funding, with the bulk of the money going to European and Greek banks (of which the former ultimately also ended up funding the ECB and thus European banks). Furthermore, we already know that as part of the latest set of conditions of the second Greek bailout, an’ ‘Escrow Account” would be established: this is simply a means for Greek creditors to have a senior claims over any “bailout” cash that is actually disbursed for things such as, you know, a Greek bailout, where the money actually trickles down where it is most needed — the Greek citizens. Here is where it just got surreal. It turns out that not only will Greece not see a single penny from the Second Greek bailout, whose entire Use of Proceeds will be limited to funding debt interest and maturity payments, but the country will actually have to fund said escrow! You read that right: the Greek bailout #2 is nothing but a Greek-funded bailout of Europe’s insolvent banks... and the Greek constitution is about to be changed to reflect this! . . .
4a. Just how acute is the situation in Greece? So bad that physical education teachers are excusing children from participating due to the fact that malnutrition prevents them from exercising without becoming dizzy. These children may very well experience long-term effects from their “austere” diet.
This is a textbook example of politics as the continuation of war by “other means”–applied von Clausewitz.
. . . It has been a common secret among PE teachers for some time now that they don’t expect pupils to do PE any more, because many of them are underfed and get dizzy. . . .
4b. Statistical analysis of the toll of austerity on the health of the Greek citizenry is staggering.
“Squeeze Dry and Obscure”; german-foreign-policy.com; 12/17/2012.
. . . . A trauma therapist, following his trip to Athens, has described the social consequences and the total collapse of the Greek economy, provoked by the German austerity dictate. The therapist provided supplementary training for his Greek colleagues, which was deemed exceedingly necessary because of the consequences of the crisis. In the process, he also became acquainted with the Greek social situation and since has been complaining of the “gigantic obscurantist capacity” of Western Europe, where the austerity policy is being continued, in spite of the catastrophic situation in Greece. For example, “entire residential blocks (...) are deprived of oil deliveries for financial reasons.” Illegally felled trees are the sole source of heating. Whoever must go to the hospital, “must bring his own sheets and bed covers, as well as the own food.” “Since the cleaning personnel was fired, doctors, nurses and orderlies, who, for months, have not been paid, are cleaning the toilettes.” The EU is warning of “the danger of an outbreak of infectious diseases because of the devastating hygienic conditions.” The trauma therapist reported that “women, in their late pregnancies, have to beg from hospital to hospital, because, having neither health insurance nor enough money no one wants to help them.” The elderly, whose pensions have been cut in half, cannot even afford important medicine. Since the crisis began, the rate of suicides, on the other hand, has not been cut in half, it has doubled.[3]
Tremendous Rage
According to the report, one need be “neither a pessimist nor an expert, to imagine what this means for interpersonal relations” as well as “for the cohesion of Greek society.” Rage against Greek politicians and “international policy of financial installments flowing into bailing out the banks, but not the people,” is “tremendous and continues to grow.” A society that can provide at least protection from the worst, would be able to absorb this rage, but Greece no longer has even this possibility, explains the trauma therapist. In Greece “the functional society was progressively undermined until it collapsed like a dilapidated house,” because “the crisis has destroyed the welfare state.” Rage is now turning into aggression and violence. As a matter of fact, in traditionally hospitable Greece, attacks — particularly against migrants — have suffered a vast increase. “The number of violent mobs that attack minorities is growing.“[4]
Racist Violence
Human rights organizations have already been complaining about this for months. For example, following the murder of an Iraqi refugee in Greece, Amnesty International discerned a growing frequency of racist-motivated attacks.[5] The UN High Commission on Refugees reported in October that between January and September, alone, 87 xenophobic-motivated attacks had been counted. This is “exceptionally alarming,” particularly in consideration of the fact that the actual numbers are likely to be far higher, since victims were either too scared to report attacks to the police or were turned away, when they did.[6] The repressive forces are also using excessive force against migrants. In mid-November, the US Embassy in Athens issued a travel warning against a rise in violent attacks against persons who, because of their complexion, are perceived to be foreign migrants.[7] Certain neighborhoods of Athens are considered “no go areas” for migrants.
Plans for a Putsch
In the throes of the crisis, the rapid rise of xenophobia that has overcome Greece is flanked by a just as rapid rise of the extreme right. The neo-Nazi Chrysi Avgi party (“Golden Dawn”), which is particularly known for its violence against migrants, won 18 seats in parliament in the last elections and — according to opinion polls — could win 12 percent today. Last fall, one of their parliamentarians declared that the party is waging a “civil war” against migrants and the left. According to publicist, Dimitris Psarras, who, for the past 20 years has been doing research on the Chrysi Avgi, “the escalation strategy (...) has a primary significance” for that party. “It is similar to the strategy of Italian neo-fascists in the 1970s and 80s: escalate the conflict on the streets, between the right-wingers and left-wingers — and in the case of Greece, the migrants — to create a climate of insecurity, so that a putsch can be justified.” Psarras points out that not only the Greek neo-Nazis, but even “serious media organs (...) are speculating on possible plans for a putsch.” He finds, “if the political and economic situation becomes even more instable and the society, more polarized, anything is possible.“[8]
4c. Greek families can no longer to bury their dead.
Vanna Mendaleni is a middle aged Greek woman who until now has not had vehement feelings about the crisis that has engulfed her country. But that changed when the softly spoken undertaker, closing her family-run funeral parlour, joined thousands of protesters on Thursday in a mass outpouring of fury over austerity policies that have plunged ever growing numbers of Greeks into poverty and fear.
“After three years of non-stop taxes and wage cuts it’s got to the point where nothing has been left standing,” she said drawing on a cigarette. “It’s so bad families can no longer afford to even bury their dead. Bodies lie unclaimed at public hospitals so that the local municipality can bury them.” . . .
4d. The toll on the health of the Greek citizenry stems from the fact that the requirements for Greek health expenditures are being calculated as an abstract budgetary requirement, rather than as what is actually needed to sustain the health of the Greek population.“Austerity Kills”; german-foreign-policy.com; 7/25/2013.
The reorganization of the Greece’s health system, under German direction, is advancing. “A final timetable is to be presented in the second half of this year,” declared the German Health Ministry (BMG). The German government sees deficits also in the lack of an “effective cost management,” but most of all in the lack of “competitive elements.” In a “Memorandum of Understanding” (MoU), the BMG and the Task Force for Greece (TFGR) have reached an agreement with the Greek government on the introduction of the highly criticized German-modeled so-called case flat-rates. The criticisms stem from the fact that patients are not being treated in response to their medical needs but on the basis of economic efficiency. The massive consequences the austerity measures are having on the public health in Greece are becoming more evident. A growing number of Greek citizens are losing their health insurance, due to unemployment and therefore must pay medical costs themselves. The shortage of medical aid, for example, has caused an increase of 40 percent in the child mortality rate since 2009. Diseases such as malaria or AIDS are spreading more rapidly. The German government continues to insist on its austerity course in spite of these ramifications.
Within the framework of the EU austerity dictates, Germany took the lead in the reorganization of the Greek health system back in March 2010. “The German Ministry of Health is in support of the Greek government’s measures to increase the efficiency and effectiveness of long-term health care, by substantial and effective transformations in the organization of its health system,” declared the State Secretary in the Ministry of Health, Stefan Kapferer in February 2011, on the occasion of the signing of the corresponding “Declaration of Intent.” [1] The concrete measures had been specified by the German Ministry of Health and the Task Force for Greece (TFGR) in the April 2012 “Memorandum of Understanding” (MoU) with the Greek government. These measures include the introduction of case flat-rates, a change in hospital management structures, the reorganization of the National Organization for Healthcare Provision insurance (EOPYY) and new pricing models for medicine. The German GIZ development aid agency was given the responsibility of the final elaboration of these plans, which thereby opens “new markets in industrialized countries.” .. . .
. . . . These proposed transformations are being implemented within the framework of the austerity measures being enforced by Berlin. According to the stipulations handed down by the Troika, Greece’s health expenditures should not surpass six percent of the country’s gross national product — in Germany these expenditures were at 11.3 percent in 2011. Since, as a result of the austerity policy imposed on that country, the Greek GNP has been on the decline for years, the expenditures for the health system are sinking drastically. By 2012, these expenditures were reduced to around 9.5 billion Euros, from 14 billion Euros in 2009.[5] The Greek government has already shut down 46 of its 130 hospitals and cut the budget by 40 percent for those remaining. This has added thousands more to the unemployed created by the devastation of the health sector. . . .
. . . . Dr. Giorgos Vichas, speaks of a “humanitarian crisis.“[7] Since 2008, the child mortality rate has risen by 40 percent. The number of HIV positive drug users has risen from 10 — 15 in 2007 to 314 in the first eight months of 2012 alone — mainly due to the drastic cutbacks in preventive programs. Malaria and tuberculosis, the West Nile and dengue fevers are continuing to spread. . . .
. . . . “The interaction between austerity policy, economic shock treatments and deficient social protective measures seems to ultimately lead to an escalation of the health and social crises in Europe,” concluded a study by several scholars published in the renowned “The Lancet” medical journal,[8] Epidemiologists, David Stuckler and Sanjay Basu drew the same conclusion in their book “The Body Economic — Why Austerity Kills.” . . .
6. Charging that Germany deliberately exaggerated analysis of the Greek debt, Zoe Georganta noted that Greece was experiencing “a new kind of occupation by the Germans.”
Greece said on Friday it would replace the board of its independent statistics service (ELSTAT) after two members resigned and another was quoted as alleging that 2009 deficit data had been artificially inflated.
It said ELSTAT chief Andreas Georgiou would keep his post.
The upward revision of Greece’s budget deficit in 2009 to 15.4 percent of gross domestic product exposed the scale of the country’s fiscal derailment and sped up the debt crisis which is still rocking the euro zone.
“The 2009 deficit was artificially inflated to show that the country had the biggest fiscal shortfall in all of Europe, even higher than Ireland’s which was 14 percent,” ELSTAT board member Zoe Georganta was quoted as saying by the Eleftherotypia newspaper. Georganta said the inclusion of a number of utilities under the general government inflated the deficit. She said this had not been handled according to Eurostat guidelines and that the chairman rejected the board’s objections.
“We have a new kind of occupation in Europe by the Germans,” Georganta told Real FM radio, adding that German officials at Eurostat put pressure on the government to inflate the 2009 deficit to justify harsh austerity measures. . . .
8a. The program reviews the European Monetary Union as the realization of the theories of Pan-German theoretician Friedrich List.
Writing in 1943, Paul Winkler foresaw that the Prusso-Teutonics would realize their goals through the creation of a German-dominated central European economic union (bearing a striking resemblance to today’s European Monetary Union.) One of the principal influences on List’s thinking was the “continental” concept of Napoleon, who attempted to economically unite Europe under French influence.
The Thousand-Year Conspiracy; by Paul Winkler; Charles Scribner’s Sons [HC]; 1943; pp. 15–16.
Charles Andler, a French author, summed up certain ideas of List in his work, The Origins of Pan-Germanism, (published in 1915.) ‘It is necessary to organize continental Europe against England. Napoleon I, a great strategist, also knew the methods of economic hegemony. His continental system, which met with opposition even from countries which might have profited from such an arrangement should be revived, but, this time, not as an instrument of Napoleonic domination. The idea of united Europe in a closed trade bloc is no longer shocking if Germany assumes domination over such a bloc—and not France. [Emphasis added.] Belgium, Holland, Switzerland, willingly or by force, will enter this ‘Customs Federation.’ Austria is assumed to be won over at the outset. Even France, if she gets rid of her notions of military conquest, will not be excluded. The first steps the Confederation would take to assure unity of thought and action would be to establish a joint representative body, as well as to organize a common fleet. But of course, both the headquarters of the Federation and its parliamentary seat would be in Germany. [Emphasis added.]”
8b. List’s doctrine was in full swing during Germany’s prosecution of the First World War:
. . . . This is a direct translation of [German Chancellor] Bethman-Hollweg’s internal memo on Germany’s war aims, from September 1914. . . .
“. . . . We must create a central European economic association through common customs treaties, to include France, Belgium, Holland, Denmark, Austria-Hungary, Poland and perhaps Italy, Sweden and Norway. This association will not have any common constitutional supreme authority and all its members will be formally equal, but in practice will be under German leadership and must stabilize Germany’s economic dominance over ‘Middle Europe’ . . .”
9a. The Listian model was put into effect by the Third Reich, as can be gleaned by reading Dorothy Thompson’s analysis of Germany’s plans for world dominance by a centralized European economic union. Ms. Thompson was writing in The New York Herald Tribune on May 31, 1940! Her comments are reproduced by Tetens on page 92.
Germany Plots with the Kremlin; T.H. Tetens; Henry Schuman [HC]; 1953; p. 92.
. . . . The Germans have a clear plan of what they intend to do in case of victory. I believe that I know the essential details of that plan. I have heard it from a sufficient number of important Germans to credit its authenticity . . . Germany’s plan is to make a customs union of Europe, with complete financial and economic control centered in Berlin. This will create at once the largest free trade area and the largest planned economy in the world. In Western Europe alone . . . there will be an economic unity of 400 million persons . . . To these will be added the resources of the British, French, Dutch and Belgian empires. These will be pooled in the name of Europa Germanica . . .
“The Germans count upon political power following economic power, and not vice versa. Territorial changes do not concern them, because there will be no ‘France’ or ‘England,’ except as language groups. Little immediate concern is felt regarding political organizations . . . . No nation will have the control of its own financial or economic system or of its customs. [Italics are mine–D.E.] The Nazification of all countries will be accomplished by economic pressure. In all countries, contacts have been established long ago with sympathetic businessmen and industrialists . . . . As far as the United States is concerned, the planners of the World Germanica laugh off the idea of any armed invasion. They say that it will be completely unnecessary to take military action against the United States to force it to play ball with this system. . . . Here, as in every other country, they have established relations with numerous industries and commercial organizations, to whom they will offer advantages in co-operation with Germany. . . .
9b. The European Economic Community was formally articulated by Reich officials during the war, with the clear design to extend and amplify the arrangement after the war. Below, we quote Gustave Koenigs, Secretary of State at a 1942 conference about the European Economic Community.
Europaische Wirtschafts Gemeinschaft (European Economic Community–translation).
. . . At the moment the so-called “European Economic Community” is not yet fact; there is no pact, no organisation, no council and no General Secretary. However, it is not just a part of our imagination or some dream by a politician — it is very real. . . .
. . . Its roots are in the economic co-operation of the European nations and it will develop after the war into a permanent European economic community. . . .
9c. A captured German document from April of 1945–a few weeks before the end of World War II–that very succinctly lays out the plans for postwar Europe.
Germany Plots with the Kremlin; T.H. Tetens; Henry Schuman [HC]; 1953; p. 240.
Document II
THE EUROPEAN PEACE-ORDER
1. Liberation of the German people from suppression and occupation.
2. Repatration of the expellees (Heimholung der Verschleppten) [These are the vertriebene groups and the German ministry for Expellees–D.E.]
3. An integral German racial community.
4. Elimination of all arbitrary acts by the enemy.
5. European Union on a federalistic basis. [That IS the EU–D.E.]
6. Right to racial autonomy. [Note that, in the most recent German election, Polish citizens of German extraction were allowed to vote–D.E..]
7. European Common-Weal (“Gemeinnutz”).
8. European Court of Arbitration [The ICC is funded by Germany and is essentially a realization of this!–D.E.]
9. Community of related peoples with the final aim to create a Germanic Reich.
10. Common-wealth between Germany and Bohemia and Moravia.
11. Guaranteed protection of racial groups (“Volksgruppen-recht”).
12. Economic integration of Europe. [That is the EMU–D.E.]
10. As noted in the remarkable piece reproduced in its entirety below, the program Deutschland is imposing on Europe undermines the security of any wealth invested in the afflicted nations. Anyone or anything foolish enough to invest in Europe should be prepared to have their assets appropriated and/or negated at some point.
In addition, one should not lose sight of the fact that the “Final Solution to the Greek and Cypriot Crises” will, like previous, superficial steps to resolve the crisis, keep the Euro weak, benefiting Germany’s export-driven economy.
One wonders how much exposure U.S. banks have to European financial institutions. If the fears of a contagion of bank runs and capital flight destroys banks in the weaker Eurozone countries, how will that affect American lenders?
The “Europa Germanica” is deliberate and, to any honest analyst familiar with the historical record, preconceived.
The post below also notes the relative economic weakness of Germany itself. Suffice it to say that most Germans have not shared in the largesse of the past decade, although they have been spared the trauma visited upon other European citizens. They are exceedingly vulnerable to the propaganda of their own media establishment.
“The Mindset” by Mark J. Grant [Author of Out of the Box] and Tyler Durden; Zero Hedge; 3/26/2013.
In all of the tortuous moments that have taken place with the European Union the one thing that has become apparent is a radical change of mindset. In the beginning there was a kind of democratic viewpoint. All nations had a voice and while some were louder than others; all were heard. This is no longer the case.
There is but one mindset now and it is decidedly German. It is not that this is good or bad or even someplace in between. That is not the real issue. The crux of the matter is that not all of the people in the EU are Germans and so they are not used to being treated in the German fashion, they do not live their lives like Germans and, quite importantly, they do not wish to be Germans.There is the problem.
The Germans will do what is necessary to accomplish their goals. There is nothing inherently bad or evil about this but it is taking its toll on many nations in Europe. In the case of Greece they went back and retroactively changed the covenants of the bond contract. They did not actually admit this of course and they called it other names but that is what they forced on Greece. In doing so they got the bond holders to shoulder a good deal of the expense of the bailout of Greece. You can say, “Right,” you can say, “Wrong,” but that is what they did. They accomplished their goal.
Always remember that the Germans are under severe financial pressure. They are still paying the bill for the East Germans. They support Target2 and their economy is just $3.6 trillion which is a fraction of the entire Eurozone. They are trying to support a house with less than desirable supports.
Then we come to Cyprus and they make it complicated and put one bank with another bank and take money from depositors and call it a “Tax” and say that people and institutions are liable for where they keep their money when it is more than 100M Euros. All true of course but they do not allow for any “Rule of Law” or “Due Process” by the judicial system but just mandate that the money will be used to help pay Europe for a loan to the sovereign government. Then they also tagged senior bond holders reversing their position of the last years so now, so that it can now be said with accuracy; everyone is at risk. Consequently they have to pay less and they have accomplished several goals which are to punish a “Casino Economy,” to put Cyprus in the same position as Greece, which is not only bankrupt but a ward of the European Union, and finally to insist, by the use of money, that Cyprus succumbs to the German demands. Note that CDS in Europe (Markit iTraxx Financial Index) has jumped 22% in just one week.
It is the occupation of Poland in a very real sense just accomplished without tanks or bloodshed as money is used instead of armaments to dominate and control a nation. Politically you may “Hiss” or you may “Applaud” but there are consequences here for investors that must be understood.
First and foremost is that they will not stop. Nothing will be allowed to get in their way. It can be senior bond holders one day, bank depositors the next, the dismantling of some Parliament on the day after that, a wealth tax on corporations on Thursday, the disallowance of dividends on Friday; with every announcement to come on Saturday evening. The next week can be a cap on bank bonuses, a demand that the cap on bank bonus savings be returned to the State, a financial transaction tax that gets expanded and taxes all bond coupons and the list goes on.What might be, could be, and nothing, absolutely nothing, will be allowed between Germany and her desire to control all of Europe.
I do not speak of motivation here. I am not bashing Germany in the furtherance of their desires. That is a useless and unnecessary exercise. However, what is profoundly necessary, if you invest in Europe, is to understand the risks that you are taking. If you place money in securities on the Continent then what is yours is theirs when they want it. I suggest you clearly understand that proposition and allow for that occurrence.
You no longer have any excuse after Greece and Cyprus. Everything may be called “one-off” but nothing is “one-off” as Germany expands its power wherever they can and by any means necessary. If you believe the propaganda, if you believe what you are told every day by the Press then I can virtually assure you that you will suffer dire consequences at some point and you will now have no one to blame but yourself.
There is also one “unintended consequence” of Cyprus and Greece. No one is going to invest in the local banks. Keeping money in the German banks, the Swiss banks or maybe even the French banks may go on but the local banks in each country are finished. In a clever move, the problems with Greece and Cyprus will drive the money from the local banking institutions in the troubled countries. Watch for capital flights in Spain, Portugal and Italy as their banks will be found unsafe and with good reason.
It is unknown, as of yet, if Germany can win this game. What can be said though is that, nation or investor, you will put yourself at peril by getting in their way. The current risks, in my opinion, are dramatically more than imagined by many or generally thought to be the case. There is no more investing in Europe just gambling and speculating and suffering the consequence of either. Anything can be changed, anything can be modified, and when the forfeiture of people’s savings is trumpeted as a “Tax” then even the English language has lost some of its meaning.
“Better to be safe than sorry,” has never had such important consequences as it does now in the European arena of the Great Game.
11. For those who consider our analysis to be extreme and manifesting hyperbole, we present a devastating critique of German EMU policy vis a vis the peripheral economies of the eurozone. Discussing Cyprus as exemplary of German methodology and intent, Christopher T. Mahoney couches his critique in altogether unambiguous language.
Mahoney is a former Vice Chairman of Moody’s! In the article below, he sounds very much like–well–Dave Emory!
ENTIRE TEXT: “We anticipate the banking resolution mechanism for the Cypriot banking sector to result in a significant downsizing of banks’ activities and therefore to severely affect the economic performance of the island from 2013 onwards. We expect an acceleration in the contraction of the Cypriot economy in 2013, with a negative real growth rate in the low double-digits and no return to positive growth before 2016. Our view is further supported by the negative feedback loop that expenditure cuts may have on the economy given the importance of public services, hence potentially challenging future consensus on fiscal strategy. We note that large uncertainties remain regarding the magnitude of further recapitalization needs for the financial sector given the expected sharp deterioration in the operating environment which will erode asset quality, as well as the behavioural responses of all economic actors to the shocks experienced by the financial sector (including risks of financial disruption related to the timing and approach for lifting of capital controls). In light of all the downside risks and the limited number of upsides, we view Cyprus as likely to default again in the coming years, as reflected by the rating level and negative outlook. Although it is not its central scenario, Moody’s also sees a material risk of a Cypriot exit from the euro area which is captured in the Caa2 country ceiling. As a result of the immediate downsizing of the banking sector and the expected spillovers to rest of the economy, especially in terms of weakened consumer and investor confidence, we forecast that the economy will contract by 12% this year and another 6.4% next year.”
–Moody’s, 15 July 2013
The purpose of EMU is to reduce the occupied states to penury in order to make them more like Germany, or Ethiopia. Ultimately the question is is: how low can per capita income decline until “Europe” becomes a dirty word, and “liberty” becomes the popular desideratum. Cyprus is the laboratory of this experiment, along with Greece and Portugal. Here is the experiment: How many people must eat out of garbage cans before the euro elites understand that EMU is destroying lives?
It must be pleasing to be ingesting a nice Brussels dinner while discussing how subhuman the Cypriots are, and how they must be “taught a valuable lesson”. That was how Stalin felt about the “rich peasants” of the Ukraine: surplus empty mouths to feed. Wouldn’t the world be a better place without so many peasants?
Perhaps, in a perfect world, Cypriots wouldn’t exist, like the kulaks and the Crimean Tatars. All Cypriots do is enable Russian plutocrats. Why should they exist? Liquidate them. Indeed, liquidate all of the parasite states of the Eurozone.
So we now know that the purpose of EMU is not to enrich the vassal states, but to occupy them and to make them penurious colonies of the hegemon. Peripheral Europe is Germany’s Latin America. But there is a crucial difference: the US has not forced its Latin American colonies to join the dollar zone. Latin America, despite its colonial status, retains monetary sovereignty. Aside from the Bolshevik laboratories of Argentina and Venezuela, Latin America is outperforming its colonial parents. Portugal and Spain should have monetary union with Brazil and Mexico, instead of Finland and Germany.
What Germany is doing to Cyprus is a crime.
12a. A very ominous proposal has been floated by the Greek government. (See text excerpts below.) Not only does it suggest the possibility that the staggering unemployment rate among Greek youth be solved by “unpaid” employment, but floats the possibility that jobless young people be shipped abroad!
We wonder to where they will be shipped? What are they supposed to do when they get there?
All is not well in the “Cradle of Democracy!”
EXCERPT: Having spent weeks talking amongst themselves about the chronic and dangerous rise of youth unemployment in Europe (as we warned here), the Center of Planning and Economic Research in Greece has proposed a controversial measure. As GreekReporter reports, the measure includes unpaid work for the young and unemployed up to 24 years old, so that companies would have a strong motive to hire young employees.
“Unpaid” work sounds a lot like slavery to us... but it gets better; the report also suggested “exporting young unemployed persons.”
“Centre of Planning and Economic Research in Greece has proposed a controversial measure in order to deal with the problem of increasing unemployment in the country.
The measure includes unpaid work for the young and unemployed up to 24 years old, so that companies would have a strong motive to hire young employees. Practically, what is proposed is the abolition of the basic salary for a year. At the same time the “export” of young unemployed persons was also proposed to other countries abroad, as Greek businesses do not appear able to hire new personnel.“
***Whether it’s Europe in the 1930’s or the US during the same period (conflicts between strikers, the National Guard and armed militias), unemployment can create a powerful cocktail of unrest. But turning your nation’s young into slaves does not seem like a good solution to us. . . .
12b. More about the proposal for de facto slavery for Greek youth:
EXCERPT: Centre of Planning and Economic Research in Greece has proposed a controversial measure in order to deal with the problem of increasing unemployment in the country.
The measure includes unpaid work for the young and unemployed up to 24 years old, so that companies would have a strong motive to hire young employees. Practically, what is proposed is the abolition of the basic salary for a year. At the same time the “export” of young unemployed persons was also proposed to other countries abroad, as Greek businesses do not appear able to hire new personnel.
According to the National Confederation of Hellenic Commerce, unemployment especially hits the ages between 15–24. The unemployment rate in Greece stands at 24.6% while 57.2% of young people are without a job. The majority of the unemployed (71%) have had no work for 12 months or more, while 23.3 % of the total have never worked. There were 3,635,905 people employed and 1,345,387 unemployed. . . .
13. Boding ill for Greek citizens, former LAOS party member and dedicated fascist Makis Voridis has been appointed Health Minister.
Good and bad economics news out of the birthplace of democracy.
The good news: According to the Wall Street Journal, Greece is seeing a boom in tech startups. Of course, that boom starts from a very low number, as the Journal reports:
“there were 144 startups in Greece in 2013, up from just 16 in 2010. The money invested in them has climbed to €42 million ($57 million), compared with just €500,000 three years ago.”
Most of the funding is geared towards servicing the sector of Greece that hasn’t been ruined by the past few years of EU-imposed austerity, which rules out a large percentage of under-35s, the presumed Internet generation. The unemployment rate for young Greeks aged 15–24 is 58.3%, while for 25–34 year old Greeks, the unemployment rate is 35.5%. Exciting new Greek startups attracting outside VC capital, like incrediblue— an online yacht booking service — and Taxibeat, a mobile taxicab hailing app — aren’t going to be much use to them.
Still, Greece’s “booming” tech sector is the good news.
Now, the bad news: Greece’s pro-EU ruling conservative party, the New Democrats, just named an actual neo-Nazi, Makis “The Hammer” Voridis, as Greece’s new Health Minister. Jewish groups are outraged over the news that Voridis—a longtime neo-fascist activist and anti-Semite who has publicly promoted the Protocols of the Elders of Zion as worthy of scholarship, and doubted the authenticity of the Diary of Anne Frank—is serving as a prominent minister in the ruling party’s cabinet, in charge of an important ministry at a time when Greece has been gutting its health care budgets, causing widespread misery.
I wrote about Voridis in November 2011, because I was shocked that a government coalition essentially imposed on Greece by the EU and Western creditors would demand that the allegedly technocratic “austerity coalition” included members of Greece’s anti-Semitic, neo-fascist LAOS party. Including Makis “The Hammer” Voridis, who served as minister of infrastructure and transport.
I call him “The Hammer” because photographs surfaced showing Voridis as a University of Athens law student, carrying a makeshift stone hammer in hand which he used to bash suspected leftwing students with. That was in 1985, when Voridis was in a fascist group called “Student Alternative” which supported Greece’s bloody military coup and military junta that ruled from 1967–1974.
Voridis was expelled from law school for clubbing leftist students, and went on to Big Things in the world of neo-fascist Greek politics. In 1994, he founded the far-right Hellenic Front, which in 2004 formed a coalition with a self-described Nazi, Konstantinos Plevris, who openly advocated for the extermination of Greece’s remaining Jews. In 2005, Voridis merged his party into the LAOS party, whose leader, Georgios Karatzaferis, publicly mocked Auschwitz and Dachau death camps as “myths,” blamed Jews for 9/11 during a speech in parliament, and said “the Jews have no legitimacy to speak in Greece.”
In late 2011, as Greece politics collapsed under the weight of its debts and the harsh EU-imposed austerity measures, the EU imposed a new “austerity” government that included “The Hammer” Voridis and other members of the neo-fascist LAOS party. The austerity government ran Greece until new elections were called in mid-2012. In those interim months, the austerity coalition pushed through radical austerity measures that caused LAOS’ fascist voters to desert them for an even more violent, more extreme neo-Nazi party, the Golden Dawn Party. One would’ve thought that’d be the end of Makis Voridis.
But Voridis is one of the slyer fascists. He joined the austerity cabinet and served from November 2011 through June 2012. In the June 2012 elections, after LAOS was obliterated for participating in the austerity government, Voridis abandoned LAOS and joined the new ruling party that won the elections, the respectable right-wing New Democracy party.
And now New Democracy is paying back the favor to their favorite austerity fascist.
...
Step by step, the Clausewitzian dream marches into reality:
Note that Orban wasn’t just calling for autonomy to be granted to ethnic Hungarians in Ukraine. He wants it to apply to ALL ethnic Hungarians living in central Europe. “Greater Hungary” has a growing appetite.
A month ago the Greek high court ruled that the Golden Dawn could participate in the EU elections after months of speculation that the party would be banned for operating as a criminal organization. Following the elections, Golden Dawn is now the third largest party in Greece. And it shows:
Note that 223 out of 224 members of the Greek parliament voted to lift immunity on Nikos Michaloliakos and two other Golden Dawn deputies, so at least the Nazi salutes didn’t appear to be helping their case. But that may not matter when it comes to Golden Dawn’s growing popular appeal. External factors are likely to dominate:
@Pterrafractyl and SWAMP–
This comment goes to the very heart of a point I made–incompletely–in my analysis of a partially-useful comment/post by SWAMP on Ukraine:
The EU and EMU are culminations of Pan-German, imperialist and Clausewitzian realpolitik stretching over centuries.
The brutalities and grinding suffering brought about by “Austerewitz” are deliberate.
In addition to eliminating the weak, elderly and infirm, the social dislocation is ideal for ethnic and/or religious scapegoating to distract the citizenry from the real source of their difficulties.
The institutionalization of economic decline for a significant portion of the population is ideal for creating a ready pool of cheap labor, as well.
“Let ’em eat fascism!”
Best,
Dave
@Dave: One of the big open questions for the EU, and especially the EMU, going forward is how ethnic/religious scapegoating is going to be achieved that can actually stabilize the EU/EMU in the long run and not drive the continent towards internal division.
Currently, the economics being imposed (the “Fiscal Compact”, the Troikas, and the ECB’s “single mandate” that ignore unemployment) are so wildly destabilizing and seemingly designed to exacerbate the crises that we really have no compelling reason to believe that the eurozone will ever be truly economically stable. Sure, the current crisis will eventually bottom out and there will be temporary recoveries, but it’s looking like the EU has chosen a crisis-prone path that is going to result in a long-term slow-grind down for the weakest member nations with many future economic crises.
And, as you point out, the social dislocation caused by these policies is ideal for ethnic and/or religious scapegoating to distract the citizenry from the real source of their difficulties (the insane policies and the people like Merkel, Schauble, and Jens Weidmann that demanded them). And yet quite a bit of that far right frustration and anger being generated from groups like the Golden Dawn and the National Front is being directed at officials in Brussels and Berlin in addition to immigrants and minorities. And of course Merkel was at the forefront of pushing the “those lazy Southern Europeans”-meme back in 2011.
So it’s going to be fascinating to watch the behavior of the opposition far right parties as they get closer and closer to being able to seize control of a member state and truly steer it in the direction of abandoning the EU or EMU because it’s not clear what the next phase is going to be in the rise of the European far right as a counter-EU force.
Hungary’s far right template might not be the same approach eventually seen in France or the Netherlands but with Marine Le Pen openly talking about France ditching the euro and destroying the EU we could be entering a period where the main arguments for and against the current European agenda — a more centralized EU and EMU on austerity-autopilot — become increasingly synonymous with the far right ideals. Whether you’re talking about the crypto-far right/Clausewitizian nature of the ordoliberal economics demanded by Berlin and getting baked into EU law or the anti-EU opposition led by people like Le Pen and the larger far right “euroskeptic” contingent in the EU parliament, the far right’s solutions are well positioned to be Europe’s next step forward, regardless of the direction. So while we don’t know how the pro and anti-EU far right might behave in a future face off, we can be pretty sure that new forms of “divide and conquer” technique involving ethnic/religious scapegoating are probably on the way. Yikes.
“The Hammer” is back, and you will not believe which part of Greek society he’s tasked to smash this time: Makis “The Hammer” Voridis is Greece’s new Health Minister:
The long desired (by the Troika) privatization of one of Greece’s biggest power companies has hit a hitch: striking unions. Fortunately(for the Troika), a Greek court just ruled that those striking unions need some busting:
The third and final round of voting required to keep the pro-austerity Greek government intact is just around the corner which means it’s an optimal time for ominous warnings from Berlin about how resistance is futile:
Happy voting Greece.
With January 25 snap elections now in store for Greece, here’s a peak at the political landscape:
Wow, that’s a really compelling case made by the official from PASOK (which saw its support drop from 42% to 4–6% in five years due to its implementation of austerity measures) for Syriza to moderate its opposition to the austerity regime:
“If Syriza moderates its program on key issues like the economy and comes closer to our program, we can support a Syriza government without necessarily participating in their government...Parties that participated in the government during the crisis took a huge risk — that’s why some of them shrank or disappeared. They become unpopular to their voters.”
It’s hard to argue with logic like that! Especially since the logic is never really explained. It’s a theme.
The beatings will continue until morale improves. Or doesn’t improve. Morale is clearly not a factor in this situation:
Note that in addition to improvements in morale not really being an issue, improving the economy isn’t really an issue either. It’s about the beatings.
Paul Krugman shared some thoughts on the situation in Greece following Syriza’s win. Let’s just say it’s unclear if Europe’s elites have determined whether or not they can still squeeze more blood from the Greek stone, but they’re probably going to try anyways. And, in doing so, they just might lead to a euro-wide unraveling of the banking system. Even worse, the EU elites appear to be aware of these dangers but just can’t help themselves. In other words, the EU’s embrace of sado-monetarist theories is increasingly leading to a sadomaso-monetarist reality, and it’s not at all clear that the EU has a chance of stopping itself:
“Can and will they be realistic, accept that they can’t extract blood from a stone — at any rate not at the rate of 4.5 percent of GDP — in time to avert a spiral into disaster?”
Could Syriza’s win prompt a euro-elite rethink it’s blood-from-stone extraction schemes before we see Greece pushed into a ‘Grexit’ and other follow suit? It’s possible. But Greece isn’t a normal stone. It’s magical pet rock that tragically rewards those that abuse it. If you squeeze it enough, the EU’s pet rock turns into a diamond and then ownership of the diamond gets magically transferred to the squeezer.
So Greece is going to be a particularly difficult stone to stop squeezing no matter how hot it gets and no matter how much of its own blood is shed during the process. The papercuts alone are going to be brutal.
What’s to be done about that pesky rabble-rouser now that the rabble has already been roused? That’s the question facing Europe’s ‘leadership’:
So what’s to be done? Threats and bluster, at least for now. But what’s the plan going forward? Well, probably more threats and bluster and demands that the austerity continue. Because that’s what happens when “internal devaluation” is selected as the method of choice for economic “rebalancing”, and the policies used to achieve this “internal devaluation” end up devaluing the larger EU economy too. The only way for the internally devaluing states to ‘keep up’ at that point is going to be to keep digging. So get ready for more digging:
As the saying goes, when you’re in a hole, you should probably stop digging, but it’s only really helpful if your friends allow you to climb out of the hole. They might not actually be very interested in that.
Paul Krugman has a column today that highlights something chronically forgotten in the discussions of Greece: The “bailout” hasn’t involved the EU giving Greece money to continue engaging in deficit spending. Greece has been running surpluses for the past two years, as required by the Troika to pay back the Greek “bailout”. A “bailout” which was actually a bailout of the foreign banks. That’s it:
In other news, Germany achieved its much desired balance budget this year for the first time since 1969. It was a year earlier than expected:
Wow, that balanced German budget sure is impressive...if you ignore how the eurozone crisis has been dragging down German borrowing costs and fueling exports. But if that Germany surplus is something to celebrate, shouldn’t the entire EU be standing in awe of Greece and its surpluses? Oh, that’s right, it can’t. It wouldn’t fit the narrative:
“In 2013, the country produced its first primary budget surplus—not including debt payments—a year ahead of schedule.” Good work on the surpluses Greece. Keep it up! You don’t a choice.
Paul Krugman has a column today that highlights something chronically forgotten in the discussions of Greece: The “bailout” hasn’t involved the EU giving Greece money to continue engaging in deficit spending. Greece has been running surpluses for the past two years, as required by the Troika to pay back the Greek “bailout”. A “bailout” which was actually a bailout of the foreign banks. That’s it:
In other news, Germany achieved its much desired balance budget this year for the first time since 1969. It was a year earlier than expected:
Wow, that balanced German budget sure is impressive...if you ignore how the eurozone crisis has been dragging down German borrowing costs and fueling exports. But if that Germany surplus is something to celebrate, shouldn’t the entire EU be standing in awe of Greece and its surpluses? Oh, that’s right, it can’t. It wouldn’t fit the narrative:
“In 2013, the country produced its first primary budget surplus—not including debt payments—a year ahead of schedule.” Good work on the surpluses Greece. Keep it up! You don’t a have choice.
Here’s more on the emerging showdown over Greece’s austerity programs and the EU threats to cut off ECB funding to Greece’s banks and implode its economy:
So that sort of lays out the parameters of the debate: On the one hand, Greece has hired Lazard Ltd. to advise it on its debt renegotiation strategy and the head of Lazard is saying a 50% haircut would give Greece a “reasonable” debt burden. On the other, we have Angela Merkel avoiding direct face to face meetings with Tsipras out of an attempt to isolate him (Yes, the fate of Greece is currently being decided via high school bullying tactics). And according to ECB Vice President Vitor Constancio, “There will be no surprises if we find out that a country is below that rating and there’s no longer a program that that waiver disappears”.
On its face this doesn’t look like a situation that’s likely to resolve itself any time soon but, as the article also points out, it has to be resolved relatively soon because of the vital nature of the ECB lifeline to Greece’s banks and the May deadline for a deal.
Also notice how Merkel is reportedly “skeptical about Tsipras’s claims that he can raise revenue by cutting corruption and increasing taxes on the rich, the official added,” and keep in mind that cracking down on corruption and raising taxes on the rich was allegedly one of the desired outcomes of the austerity-era. But now that Greece has the kind of leftist government that might actually be inclined to carry out these kind of elite-targeted reforms, Angel Merkel is suddenly not interested in an anti-corruption drive or raising taxes on the rich. Just stick with kicking the rabble.
As we can see, in the new EU there’s love, but it’s conditional love. Conditional on one thing: Unconditionally kissing the asses of Europe’s top elites while they say things like:
Yes, if only Greece would “undertake their own reforms and savings efforts”...except for reforms cracking down on elites. And let’s just ignore the surpluses Greece has been running. No one said the path to Greece’s economic renewal would be easy. Quite the opposite.
Here’s a great piece from Foreign Policy that ties together a number of important points on the structure of the eurozone and how Germany’s austerity doctrine has been AMAZING for Germany’s wealthy elites that are positioned to fully benefit from a series of export-boosting policies and circumstances, but not actually all that great for Germany’s workers who have seen their wages stagnate in the eurozone’s new permanent low-inflation/austerity environment.
The article also makes an interesting suggestion in the context of the current Greek/German austerity showdown: The current eurozone set up is SO incredibly beneficial for Germany’s exporting elites that there’s no way they can realistically allow Greece to leave. It would just be too painful to risk other following suit and losing the artificially cheap euro and constant downward pressure on German wages. And that means all this talk about Berlin being able to withstand a ‘Grexit’ is BS because, while the eurozone might be able to technically survive, it’s just not worth it to the wealthier nations if the poorer ones aren’t involved too. So, from that perspective, the real power in this showdown lies with Athens, not Berlin. And the new Greek government knows it:
To reiterate:
Yep, thanks to the eurozone and austerity policies, Germany’s wealth inequality is almost on a par with that of the United States. LOL! And THAT’s the crew that’s calling the shots in Europe.
So Greece’s new government is clearly intent on playing ‘chicken’ with Berlin. But is it playing ‘chicken’ confidently, as the article suggest? If not, someone needs to give them a pep talk. And if someone could give Berlin’s leadership an anti-pep talk soon that would also be helpful:
So what will Germany do when the eurozone’s poor golden geese decide to play chicken? Threaten to keep plucking them until the they gets back in their cages and stop squawking, of course:
Wow. That’s some cold ‘chicken’.
As the showdown between Greece and the troika progresses along, it’s getting increasingly difficult to avoid the image of a wealthy parent yelling “stop that crying or I’ll give you something to cry about” at their child at the supermarket. A clearly abused and malnourished child, inexplicably living in poverty:
“That is a rule, so there will be no surprises if we find out that a country is below that rating and there’s no longer a program that that waiver disappears.”
Well, try not to be surprised:
It’s happening again. It never stops.
As the following piece points out, “It is not just the common currency that is under threat, or even the EU.
It is the very resolve to transform Europe, after two catastrophic 20th century wars and nearly two millennia of continual warfare, from a battlefield into a peaceful and prosperous community.
The threatened loss of this epoch-making resolve is the real European crisis”:
That was a great piece, but note that, while there are in indeed reasons why many accuse Tsipras and those who elected him of being unable to face reality, those reasons are only good reasons if it happens to be the case that that the “common sense” assumption that “a collective belt tightening necessarily leads to recovery and growth — rather than perpetual stagnation” is actually a correct assumption. And since that “common sense” assumption actually makes no sense at all, especially when applied to a large number of member states simultaneously, it’s a reminder that improving our collective understanding of economics to the point where economic suicide isn’t the default “common sense” response to a crisis like this is actually part of what Europe needs if it’s going to have any real chance of maintaining that resolve to transform Europe from a battlefield into a prosperous community.
In other words, while the anti-austerity movements rippling across the West may not have all the answers, they certainly have an absolutely vital answer.
One of the more bizarre assertions that you often see pop up in the austerity debates is the idea that Greece, unlike Spain and Ireland, hasn’t done any real austerity yet and that’s why there should be no deviation from the Troika’s austerity dictates. Sure, there are some areas where Greece hasn’t yet implemented reforms that are actually worthwhile, like cracking down on tax evasion, but that’s still very different from assuming that Greece hasn’t been beating enduring severe austerity. So here’s a look at some of the non-austerity taking place in Greece:
Part of what makes the default austerity policy prescription of slashing everything at once so senseless for a country in Greece’s situation is that, of all the calls for “structural reform” you can think of, ending Greece’s widespread tax-evasion problem really is one of the more valuable “structural reforms” that one could reasonably request of Greece. And yet, you almost can’t imagine a more effective way to ensure that the populace isn’t going to be backing a sudden flood of new taxes than creating a situation where almost everyone is suddenly poorer and universal healthcare coverage is removed so pay taxes might literally involve paying the money you need to buy the medicine you need to live. Or the food your children need to live. Hope the EU can come to terms with this simple fact since Syriza is pledge to crack down on tax evasion as part of its post-austerity agenda:
Yes, “If the EU and IMF want a blank slate in Greece, wiping away the culture of corruption that plagues its politics and the array of obstacles that stand in way of private-sector growth, they may have a better local partner than they realize”.
As austerity advocates like to suggest: no pain, no gain. It’s the fact that the gains might not actually go to the people feeling the pain that’s rarely pointed out. But, in this case, Syriza is offering the EU and IMF that it will provide gains (greater tax collection) in exchange for reducing pain (like reversing all the other society-destroying austerity policies). And as the above article pointed out:
Could Syriza’s “less pain and still gain” strategy temp the EU and IMF? Well, maybe, but that assumes that the people running the EU and IMF really do place a higher priority on cracking down on Greek tax evaders vs continuing the dismantlement of the Greek middle class. And since permanently impoverishing Greece has the potential to permanently drag down the value of the euro, boosting exports in other eurozone members, it’s a very questionable assumption that collecting Greek taxes is actually a higher priority than dismantling the Greek society. The beatings will continue
until morale improves.Paul Krugman pointed out something about the situation in Greece that doesn’t alone apply to Greece. It applies to every member of the EU, especially the smaller members, and it doesn’t bode well for the fate of democracy in the EU or democracy in general as the world becomes increasingly intertwined via transnational treaties and international institutions:
If you look at the conflicting incentives EU national government officials face, between looking out for the best interests of their member nation vs catering to the desires of the international financial elites and institutions (like the people that show up to the Davos meetings), it’s pretty clear that those national officials have a strong incentive to be as brutal towards their home nation as possible if that’s what the international elites desires. After all, if they impose austerity over the opposition of their own populace, that’s just going to earn them an even greater accolades amongst their future employers at one of the international institutions pushing austerity like the European Commission or IMF. In other words, we’re all familiar with the concept of the “revolving door” between business and government that encourages elected officials and other high-level bureaucrats to the do the bidding of their potential post-government employers in the private sector. But for the EU, there’s a whole new door to revolve through: the EU-level
institutional revolving door, although it might be more a one-way door since the voters aren’t really going to appreciate elected officials that destroy their societies at the behest of future international employers. Still, it’s clearly a very tempting one-way door.
And, returning to the crisis in Greece, Krugman notes that, unlike past Greek governments, the current crop of rabble rousers have no realistic prospects of getting any of those international institutional jobs, so the “carrots for officials if they beat the populace with sticks”-mechanisms used to keep national government in line during previous crises may not apply this time:
“The new Greek leaders will succeed or fail, personally, based on what happens to Greece; there will be no consolation prizes for failing conventionally.”
Well, let’s hope Krugman is correct on that point!
It’s also worth noting that if Krugman is indeed correct about the resolve of the new Greek government and current showdown with the EU doesn’t work out as planned, we just see “Plan B”:
“What we want is a deal. But if there is no deal — hopefully (there will be) — and if we see that Germany remains rigid and wants to blow apart Europe, then we have the obligation to go to Plan B. Plan B is to get funding from another source...It could the United States at best, it could be Russia, it could be China or other countries.”
As we can see, when one door closes, another one opens. Just ask Cyprus, although they may not want to talk about that particular door right now:
The sentiment expressed at the end is a good summary of what a number of tiny nations across the EU are probably going to be feeling sooner or later:“We cannot afford to turn Cyprus into a satellite of either the Americans, the Russians or anyone else”.
Of course, since Cyprus, like Greece, is basically already an EU vassal state at this point, it’s probably not really a question of whether or not Greece or Cyprus will act as a relative “satellite” for some larger power but which one it cozies up to. The EU was certainly the obvious choice, but since it’s gone kind of insane in recent years “Plan Bs” are now required. So it’ll be interesting to see how it all works out, especially since there’s nothing limiting the plans to Plans A and B. Plan Z could be fun too (you know you want it!).
The talks between Greece and the eurogroup just collapsed due to one of the sides taking a completely uncompromising stance. Guess which side:
“Alternatively, and I guess more likely, they’ve decided to push Greece over the edge. Rather than give any ground, they prefer to see Greece forced into default and probably out of the euro, with the presumed economic wreckage as an object lesson to anyone else thinking of asking for relief. That is, they’re setting out to impose the economic equivalent of the “Carthaginian peace” France sought to impose on Germany after World War I.” Krugman ain’t kidding about that.
So it’s looking like we’re nearing the end of the Greek EU Odyssey, with Greece standing at the edge of a cliff and the rest of Europe yelling “Jump! Jump! Jump! Jump or we’ll push you ourselves!” And once Greece jumps and goes *splat* on the rocks below, it is to be gawked at until the rest of the European rabble is scared back into the economic 19th century.
The beatings will continue
until morale improvesuntil we decide to you into a scarecrow.The talks between Greece and the eurogroup just collapsed due to one of the sides taking a completely uncompromising stance. Guess which side:
“Alternatively, and I guess more likely, they’ve decided to push Greece over the edge. Rather than give any ground, they prefer to see Greece forced into default and probably out of the euro, with the presumed economic wreckage as an object lesson to anyone else thinking of asking for relief. That is, they’re setting out to impose the economic equivalent of the “Carthaginian peace” France sought to impose on Germany after World War I.” Krugman ain’t kidding about that.
So it’s looking like we’re nearing the end of the Greek EU Odyssey, with Greece standing at the edge of a cliff and the rest of Europe yelling “Jump! Jump! Jump! Jump or we’ll push you ourselves!” And once Greece jumps and goes *splat* on the rocks below, it is to be gawked at until the rest of the European rabble is scared back into the economic 19th century.
The beatings will continue
until morale improvesuntil we decide to turn you into a scarecrow.With cries of “blackmail” coming from both sides of the Greek negotiations, check out what reportedly took place at a meeting of EU finance ministers: A draft proposal was presented to Greece by EU Economics Commissioner Pierre Moscovici that Greek finance minister Yanis Varoufakis says he would have accepted. The draft would have simply given Athens four-months of breathing space in return for the Greek government holding off from doing any major policy changes. In other words, it simply defuses the immediate crisis that could result in in ‘Grexit’ at the end of this month.
But then, of course, the pro-austerity Dutch finance minister who was chairing the meeting where the proposal took place, Jeroen Dijsselbloem, refused to allow discussion the plan and later said that Greece had until Friday to accept the extension of the bailout. So that happened:
You have to love this:
Yes, Dijsselbloem refused to discuss a proposal by the EU Economics Commissioner but also felt the need to plead with the Greeks to buy themselves time to discuss the way forward by simply requesting an extension of the bailout...you know the one thing the new Greek government was elected NOT to do because that would mean nothing changes and Greece continues to drown. And then he warned Greece that it has until Friday to request the extension.
So it’s looking like the pro-austerity crowd is so dead set on avoiding any deviation from Greece’s austerity agenda that they’ll overrule the EU Economics Commissioner in order to keep the threat of a ‘Grexit’ on the table when there are just days left to find a solution and the Greeks are still willing to endure austerity even with a renegotiation. There would still be austerity, just not quite as much austerity so Greece’s society doesn’t keep falling apart. That’s all Greece is asking for and some form of austerity would still continue.
And, of course, Germany Finance Minister Wolfgange Schaeuble felt the need to suggest that Europe just can’t trust Greece to stick to any agreements to get its finances in order:
So, keeping in mind that Greece ran a 1.5% surplus in 2014 and is slated to run a 3% surplus in 2015 that is scheduled to jump to 4.5% and stay there for years, here’s another look at Greece’s track record on “getting its finances in order”:
Part of what makes this latest chapter of our contemporary Greek tragedy is that when you see even countries like Ireland jumping on the “beat the Greeks” bandwagon, a precedent is being established that basically guarantees the eurozone is going to be a force for development and right-wing economics for decades to come. An uncontested precedent. So at this point, the eurozone has turned itself into the Union of Loan Sharks and any future European fiscal crises are set to be resolved under loan shark conditions. One of the greatest challenges that’s always faced a union like the eurozone is getting all the parties to agree to anything, and yet usury has received a nearly unanimous endorsement.
Given all that, it’s hard to see how the inevitable crises of the future aren’t going to turn into a repeat of one of the worst loan shark feeding frenzies in the past century. Over and over.
Ack, the link to the chart in this Krugman piece on “Comparative Austerity” didn’t show up above. Be sure to check out the chart showing the following changes in real non-interest spending from 2007–2014:
Spain: ~+3%
Portugal: ~-2%
Ireland: ~-2.5%
Lavtvia: ~-3%
Greece: ~-22%
That’s something the rest of the eurozone should definitely keep in mind during the ongoing negotiations with Greece. Because if Greece has had it too easy, hasn’t everyone else had it way too easy too?
With that in mind, here’s another set of charts worth pondering:
That’s right: contrary to the common perception across Europe that austerity isn’t “working” in Greece because the Greeks have been resisting their necessary “structural reforms”, austerity in Greece has been “working” far more than anywhere else when viewed from the Euro-elite perspective where increasing “competitiveness” is the key “structural reforms”. So, from an elite perspective, Greece’s austerity program has been a stunning success...Greeks really are far more “competitive” than they were before. And yet the economy is still failing to create jobs for the jobless or restore growth..
So if you’ve ever wonder why we so often hear calls for “structural reforms” in one nation after another, but never actually hear anyone articulate a vision for what the reformed economy might look like in, say, 10 or 20 years from now (like what high value-added sectors that pay decent wages are expected to be created), the “success” of Greece’s austerity should be a clue as to why you never actually hear anyone describe what they think a thriving Greek economy might look like. Especially with all the cuts to Greece’s educational system...what exactly are the paths to economic success that Europe’s leadership has in mind that include massive cuts to Greece’s human capital?
Oddly, we never really hear that vision. Instead, we just get vague statements about how “increased ‘competitiveness’ = future prosperity!” and no one seems to pry further.
So, while it’s possible that the Euro-elites don’t actually have a vision for the future of Greece and the other peripheral nations, it’s also very possible that they have something in mind, but prefer to keep it to themselves. Or least, preferred to keep it to themselves. We’re definitely getting a better sense of what’s going on inside those Euro-elite heads these days whether they share it or not.
Here’s a piece on how the Greek economic crisis is laying the groundwork for a political backlash across Europe and it ends with a rather ominous possibility: If Greece ends getting kicked out of the eurozone, it’s going to be awfully hard to put the growing perception that Europe is being run as a German usury colony back in the bottle. So what could that mean for Europe if the zeitgeist emerges across the periphery that EVERYONE is losing their freedom and the situation is no longer “the eurozone vs a very determined Greece government” but instead “A very determined rich eurozone vs a very determined poor eurozone”? How on earth is the eurozone supposed to resolve that kind of a conflict?
Given what we’ve seen so far it’s not at all clear. And yet, given what we’ve seen so far, and the reality the the eurozone really is being turned into a debt colony, it’s also increasingly likely that we’re going to find out how Europe handles a major Rich vs Poor showdown sooner or later:
“The problem is that Syriza is not a Social Democratic party that has no scruple about selling its voters down the river. They appear to be sincerely committed to democracy and reform – and prepared to fight for it.” Yep, it’s a problem!
The fact that governments that are sincerely committed to democracy and reform are seen a problem is also a pretty big problem.
While it might sometimes seem like Europe has been caught in the sequel to Groundhog Day, with the same crises and same responses over and over, keep in mind that the only way to escape the time loop was by Bill Murray’s character having an epiphany and finding true love. So, from that perspective, we clearly have a long ways to go before Europe escapes its time loop. But also keep in mind that we never discover in Groundhog Day what would have happened if Bill Murray’s character pushes his romantic interest off a cliff instead. Would the opposite of an epiphany and true love have allowed him to escape from the time loop too? We’ll find out in the sequel:
So Greece is still pledging to...
And keep in mind that Greec was running a 1.5% surplus in 2014, so the austerity schedule that the EU demanding Greece stick to would double Greece’s surplus (and then go up to 4.5% in 2016). So Greece is still pledging to pay back all its creditors — which is a HUGE concession given the size of its debt — just not with austerity policies that are slated to get get worse and make Greece’s existing debt even more crippling.
So Greece makes another set of concessions and agrees to continue working the reviled troika, while Berlin issues another demand that there shall be no compromises whatsoever. Just another day in the death of the eurozone:
“Do the Germans really think that’s a likely outcome? I suspect not. This looks to me like an attempt to force Greece out of the euro, right now. German policy is objectively pro-Grexit.
It’s also, given the likely fallout, objectively pro-Golden Dawn.”
So now that it’s looking like the EU is engaging in objectively pro-‘Grexit’/Golden Dawn actions, you have to wonder how much popular support there will for an EU military invasion of Greece (for humanitarian purposes) following a ‘Grexit’ should the Golden Dawn climb to power in the midst of a Greek economic collapse and behave like, well, Nazis they are. Forced austerity and privatizations were clear no-brainers for those that desire to see Greece reduced to a vassal state, and war can certainly turn Greece into a vassal state too, but war ain’t cheap. What’s a tightfisted authoritarian to do?
It’s all a reminder that, while a day that never ends might seem like some form of hell, when you’re in a situation that looks like it’s on the verge of getting precipitously worse, there are scenarios far worse than being stuck in a Groundhog Day time loop. Like a Golden Dawn.
There’s something about a deadline that makes one appreciate the incredible value of time:
Yep, we don’t know what the next 60 or 90 days holds. But at least now we know that in about 120 days we’ll probably be right be to where we started:
Woohoo! A four month extension. Better than nothing. Although when you look at some of the fine print it’s unclear how much better than nothing this deal really is since, as Krugman pointed out above, there is simply no way Greece’s new government is going to have time to put together a detailed proposal, and yet the deal just proposed mandates that Greece give a written plan on Monday of how its going to continue its austerity during the remainder of the bailout period (which would have ended at the end of the month but is to be extended for four months). AND there’s a loophole that says the EU members can reverse the deal on Tuesday if they have any doubts:
So Greece has a few days to put together a four month austerity package to a bunch of pro-austerity politicians with an incentive to make life as awful as possible for the Greeks in order to hide their own austerity madness. As Wolfgang Schaeuble said, “being in government is a date with reality, and reality is often not as nice as a dream,” which is a good way to summarize the nightmarish stance of Greece’s partners in this fight.
But, as Krugman points out below, we still don’t know how bad Greece’s nightmare is going to get, since none of the underlying issues have been resolved by the agreement:
Yes, we’re in a weird place. Especially since one of Greece’s primary strength in this conflict is the global sympathy its garnering by being the eurozone’s Wicker Man. And it’s looking an awful lot like Greece’s eurozone “partners” are going to be intent turning the austerity screws on Greece as much as possible over the next four months, assuming the agreement isn’t nixed entirely due to “doubts”.
You often hear calls for Europe to make an example out of Greece, but does Europe really want to burn its Wicker Man in such a high-profile public manner? Because the Wicker Man is still alive and kicking and, as Krugman points out, the Wicker Man is only going to get better and better at explaining to the global audience that this crazy usury cult really has no right to torment him so. Is that what the eurozone wants the European Project to be known as? The Wicker Man Usury Union?
And is there any hope of the austerity ending, or at least easing, four months from now? It’s hard to see how that will happen unless the governments of Europe start feeling the pain of being known globally as sadists since there appears to be little else that could persuade them. Could that happen? Well, Wolfgang Schaeuble was right when he said, “being in government is a date with reality, and reality is often not as nice as a dream”, but that doesn’t just apply to governments or the citizens of austerity-slammed societies. The global audiences forced to watch a continent that could have been a force for a better tomorrow turn itself into a debt death cult dedicated to projecting right-wing economic theories as far and wide as possible is pretty painful too. Sure, it’s not as painful as directly experiencing the austerity, but still really hurts to watch.
Is there an attempt to create a situation where the Greeks have to drop Yanis Varoufakis as their negotiator? It’s looking like it:
Assuming this is a fake report, were the reports that Wolgang Schäuble said he no longer wanted to speak with Varoufakis fake too? If not, it will be interesting to see how this plays out since Wolgang Schäuble is pretty much the only person that matters in these Eurogroup negotiations and its unclear how any negotiations can be made if they refuse to even talk to each other.
And you thought high school sucked.
Greece submitted its austerity plans to the Eurogroup. It’s about as compromising a proposal as you should expect from someone negotiating with a group of uncompromising people that don’t mind using the threat of a humanitarian crisis as one of their key bargaining chips:
While this might seem like a complete capitulation by the Greek government, keep in mind that simply freezing the pay cuts in place is actually a victory of sorts since further pay cuts are part of the schedule. Same with the privatizations. In other words, the beatings will continue but at a steady pace.
Also keep in mind that it really is a victory, of sorts, if Greece can maneuver its eurozones “partners” into making explicit demands like:
Conditions like that don’t exactly support the “we’re not a bunch of monsters but instead prudent disciplinarians” image the eurozone governments seem to like to project. Plus, there wasn’t really much Greece could do anyways since the Eurogroup basically told Greece that if it didn’t submit to their demands it was going to crash the banking system and make the humanitarian crisis it demands must not be addressed much, much worse:
” If anything, this experience should help the Greek people decide whether there’s a future for them and their children in the Eurozone or not. Dealing with authoritarian boneheads (The Eurogroup) may eventually prove to be more trouble than its worth. (A Grexit looks better by the day!)” Indeed! And it’s not just Greece that should be learning for this experience. Greece doesn’t have a European monopoly on “humanitarian crises”. Neither does the eurozone. The whole EU has a “humanitarian crisis” crisis:
To reiterate...
As we can see, under the New European social contract you are still your brother’s keeper, but feel free to keep him in a socioeconomic cage if he owes you money. It’ll keep him out of trouble while he’s paying you back. Feeding and healthcare are optional, especially for kids.
With the “Grexit” narrowly avoided (for now) and the eurozone nightmare set to continue, here’s an opinion piece from 2011 that’s a reminder that many of the underlying crisis dynamics have been understood by at least some analysts and observers since the beginning of the crisis. What hasn’t been understood is how little Europe’s leaders care about things like addressing the underlying dynamics that led to the crisis or even avoiding making a bad situation worse. Case in point:
So that was the view back in 2011. Oh how times change. For instance, here’s a recent piece from the British press that highlights the growing awareness across Europe that, by so heartily backing Berlin’s demands of “obey or leave” imposed on Greece, the rest of Europe just set itself up for the same treatment Greece got:
“To stick with the “debt colony” analogy: the old British empire, faced with successful revolts, was adept at saying “you’ve won, now let’s manage the path to independence smoothly”. We’re about to find out what a Europe dominated by Germany, backed by Finland, Slovakia and Latvia, can muster by way of diplomatic largesse.” It’s worth pointing out that there is another option. It’s probably not an option a continent of debt-colonies is psychologically capable of pondering, but it’s an option:
“The “growth” Germany generates by funding unsustainable trade imbalances — inside and outside the eurozone — is an illusion. It is growth that is borrowed, for only a while. For Germany, and for the world, it’s a bad trade.” Huh, it almost sounds like Germany can’t stop itself from running excessively high surpluses for that short-term high even though the negative behavior only lead to long-term pain. And, even more alarming, the capacity to see that this is a problem just doesn’t seem to be there in Berlin’s collective mind. Treatment is recommended.
One of the factors to keep in mind regarding the current crisis over the Greek “bailout” (a “bailout” of foreign creditors with lots of austerity strings attached) that Greece is desperate to moderate is that there’s no reason to believe this will be the final “bailout” for Greece. Especially as long as austerity measures are still strangling the Greek economy. It a reality that even the eurozone finance ministers recognize, despite their apparent inability to recognize how their austerity mandates are ensuring that future “bailouts” will be needed. Ideological blinders tend to do that:
See how the fun system works?
Step 1. Make obscene austerity mandates based on the premise that the austerity will be “expansionary” and actually help the economy.
Step 2. Wait for the county’s economy to collapse from all the austerity, making paying back the “bailout” debt impossible.
Step 3. Throw a massive fit when the country cries out against this treatment.
Step 4. Return to Step 1.
How nice!
But also keep in mind that just because Greece might need a another bailout in the future doesn’t mean it’s going to get one since national governments would all have to approve and then it because a political question of helping the needy. And you don’t want to be needy in the new EU:
While it’s clear that the votes are going to be there to pass this particular bailout extension, is there any doubt a future bailout would be fought tooth and nail? Especially if the systemic risks to the German financial system from a Greek meltdown keeps shrinking?
Just how willing is Berlin or Germany’s electorate going to be for any future bailoutsas the exposure to Greek debt (public and private) keeps falling?
Also keep in mind that Greece isn’t the only eurozone member that could be facing a future bailout before the crisis that started in 2008 is really over. And even if no more bailouts are needed for the current crisis, what about future crises? Aren’t future financial crises kind of inevitable given the structure of the eurozone and all of its flaws we’ve seen on display since 2008 (not to mention just the odds of sh!t happening over time)? After this horrible round of bailout experiences (it hasn’t actually been all that bad for the creditor nations but they seem to be perceiving these bailouts as an existential threat), what on earth are future bailouts going to look like given that it appears the eurozone governments (and much of the public) have learned NOTHING about their disastrous policies? More of the same? That’s one of the big unknowns going forward at this point.
But don’t forget that there are plenty of other big unknowns, including all of the various proposed fundamental changes to how the eurozone governs itself. For instance, you know how we keep hearing grumbling about how there needs to be some way to guarantee that individual governments don’t overspend. It’s an odd response since to the crisis since, outside of Greece, most of the national debt crises were fueled by reckless private sector lending. But it is what it is. The eurozone leadership wants the eurozone to be running the economic policies of eurozone members and, given the way things have gone thus far, that’s probably what the eurozone leadership is going to get sooner or later. After all, if you believe the hype, all Europe needs to do is implement right-wing economic policies via a supranational policy-making body and there won’t be any need for future bailouts. That’s the hype! Believe it or not. Your input doesn’t really matter:
While vague, Mario Draghi’s proposal for transferring sovereignty should sound pretty familiar at this point:
That’s the plan! It’s one of the themes that keeps coming up over and over since that’s sort of how the system operates at this point anyways for the bailout-afflicted counties, except it sounds like Draghi is proposing a permanent entity that would have oversight over national spending in bad times and good.
And since it’s obvious that this entity would be completely right-wing oriented, we’re basically looking at a system of lost sovereignty in exchange for mandated preemptive austerity. THAT’s the eurozone’s long-term solution to more bailouts: loss of sovereignty in exchange for preemptive permanent austerity. At least that’s certainly how it looks today. And since these kind of major overhauls tend to only happen in a crisis, we just have to wait until the next major crisis before such a proposal is finally put on the table. It’s really just a matter of time.
So get ready for some more big changes eurozone! Or don’t get ready. Your acceptance of your fate isn’t really relevant.
Greece’s Prime Minister is accusing Spain and Portugal of being part of an “anti-Athens axis”. “Anti-Athens Debt Colonies” would have also worked, but “anti-Athen axis” has a nice ring to it too:
Yeah, it’s pretty hard to deny that the governments of Spain and Portugal didn’t hide their desires to see the Great Greek Beatdown Tragedy continue unabated, although the characterization of Lisbon or Madrid as leaders in the ‘anti-Athens axis’ could be improved since these governments, themselves, are pretty much just taking marching orders from Berlin and the rest of the eurozone creditor states. In other words, the full anti-Athens axis appeared to include every single eurozone member except Greece (it’s sort of a ‘Kiss up and Kick Down Axis’ at this point).
It’s part of what makes the Greek Tragedy so tragic: the nearly universal support of 19th-century junk economics and national usury policies has infested the European social contract with some sort of twisted pseudo-gold-standard regime that is looking like it’s going to doom Europe until there’s either an overhaul of Europe’s ruling macroeconomic worldview or the eurozone itself unravels.
So, from that perspective, it’s really more of an anti-almost-everyone axis. Or, at a minimum, an anti-Athen-Lisbon-Madrid-Rome-Dublin axis that just happens to include Lisbon, Madrid, and Dublin as some of its most enthusiastic members. Member isn’t cheap:
This part really captures the underpants-gnome nature of so many of the calls for “structural reforms” you hear from pro-austerity economists:
Yes, why can’t Portugal simply turn itself into a high-tech export powerhouse and pull itself up from its bootstraps that way? It should be easy with all the helpful achievements the austerity policies have achieved so far. Achievements like:
— A 19% poverty rate
— A 14% unemployment rate, which is characterized as relatively good.
— Exports of 100,000 young people, especially the most highly skilled like engineers or nurses.
— A nearly destroyed safety-net.
— And don’t forget the low interest rates!
As we can see, the austerity is already working! Exports are up! Granted, it’s exports of young engineers and other skilled workers but it’s a start! Tech powerhouse status here we come!
See how helpful austerity is, although Keep in mind that the low borrowing costs were largely a result of the European Central Bank’s actions and pledges (Austerity helped, but primarily by depressing the economy).
Also keep in mind that when Tsipras characterizes the recent 4 month extension as a victory, it really was a victory of sorts even when you consider all the concessions made because at least now there’s a chance of a change in policy when this gets renegotiated months from now.
Of course, unless Greece can find more members so join its anti-anti-Almost-Everyone axis (an axis of one so far), it’s unlikely that those concessions Greece won are going to amount to much in the end. That’s why it’s so important for Europe’s anti-austerity leaders to clearly point out the perverse incentives the pro-austerity governments have in ensuring that Greece be allowed no meaningful long-term deviation from the austerity policies. So hopefully Alexis Tsipras will have some success in convincing some of his fellow leaders that they probably should be members of axis that is dedicated to the demise of their societies, even if it’s a little embarrassing to change course. There are worse things than embarrassment. Tsipras needs to somehow communicate this to peers, although it’s not at all clear how he can effectively do that given the intense depressions their nations have endured and the resistance to positive changes that can follow periods of deep pain and sorrow.
Do the leaders of Europe use Facebook? Maybe that could be a way to start the necessary conversation...
ECB President Mario Draghi quelled any hopes that the ECB would play a role of emergency lender of last resort for the Greek government. He’s previously ruled out the buying Greek bonds via the QE program, but not it looks like raising the cap on short-term treasury bills issued by Athens is also going to be rejected, which means the eurozone’s official plans for resolving the Greek crisis appear to still involve pretty much just waiting for Greece to run out of cash to presumably turn the screws some more:
And the screws get another twist.
And speaking of turning screws, Warren Buffett took part in a recent CNBC Squawk Box interview (available at top of article here) and addressed the question of whether or not the wealthier eurozone members should just give the poorer states cash as a way to resolve the crisis. Buffett’s response? It wasn’t so much a call for more turning of the screws. It was more like advocating that Germany rub Greece’s nose in the mess over and over until Greece submits or leaves. Because, as Buffett put it, if you don’t want a dog peeing on the rug you can’t reward it for that behavior:
When the CNBC host pushes back and points out the large amounts of lending by wealthier eurozone nations, especially Germany, to countries like Greece and the immense benefit that these nations have had by reducing their value of their currencies by linking up their nations to economically weaker neighbors, Buffett replies that:
And later in the interview says...
He also says if the wealthier eurozone nations want give to the poorer members as a form of foreign aid that’s fine.
He also added in the interview that he thinks the US banking system “is pretty damn good for the United States”.
So apparently Warren Buffett is unaware of the routine fiscal transfers from wealthier to poorer states in the US or thinks that should end and the poorest states should become even poorer in the US. And he also seems to see the eurozone as it is today as an unworkable construct, like if the US merged with Venezuela. But he still thinks it’s ok to treat Greece like a dog that’s peeing on the rug when it demands any changes because:
Aha.