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Von Clausewitz, List, the Bormann Capital Network and the Subjugation of Europe

COMMENT: To  come to under­stand what is tak­ing place in Europe, it is essen­tial to under­stand the mil­i­tary phi­los­o­phy of Pruss­ian mil­i­tary the­o­reti­cian Karl von Clause­witz. 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.

A pri­ma­ry focus of this web­site is, of course, the Bor­mann cap­i­tal net­work, termed by one bank­ing pro­fes­sion­al “the largest con­cen­tra­tion of mon­ey pow­er under a sin­gle author­i­ty in his­to­ry.”

Hav­ing plun­dered, pooled and secret­ed away the liq­uid wealth of Europe, the net­work was in excel­lent posi­tion to real­ize the von Clause­witz gam­bit of the post-war, explained below.

Beyond that, the Bor­mann cap­i­tal net­work is more than just the fruit of World War II plun­der. The orga­ni­za­tion’s vast wealth derives from cor­po­rate pow­er and the busi­ness and polit­i­cal bro­kers that admin­is­ter that influ­ence. Heav­i­ly invest­ed in major cor­po­ra­tions (espe­cial­ly Amer­i­can “blue chip” cor­po­ra­tions) the group can exert great pres­sure with lit­tle effort.

Of course, when that does­n’t work, the Under­ground Reich will not hes­i­tate to use dead­ly force.

19th Cen­tu­ry pan-Ger­man the­o­reti­cian Friedrich List fore­saw a Ger­many eco­nom­i­cal­ly astride Europe as a vehi­cle for world dom­i­na­tion. The Under­ground Reich has real­ized the Nazi goal, for­mal­ized through the Fed­er­al Repub­lic.

All Hon­or­able Men by James Stew­art Mar­tin; Lit­tle, Brown [HC]; Copy­right 1950 by James Stew­art Mar­tin; p. 235.

. . . . 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. . . .

COMMENT: In ana­lyz­ing the deba­cle of the euro­zone cri­sis and the tragedy of Greece, it is worth not­ing that unfor­tu­nate coun­try is essen­tial­ly being sys­tem­at­i­cal­ly occu­pied, eco­nom­i­cal­ly col­o­nized and enslaved using the von Clause­witz con­cept of “oth­er means.”

We’ve seen 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.”

“Europe Adrift (1)”; german-foreign-policy.com; 12/21/2011.

. . . 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. . . .

COMMENT: As Greece is being sub­ject­ed to sys­tem­at­ic eco­nom­ic exploita­tion and loot­ing, with no effec­tive par­tic­i­pa­tion by the Greek cit­i­zen­ry, it is impor­tant to remem­ber that their prob­lems stem, in part, from the long term Ger­man pol­i­cy of avoid­ing repa­ra­tions for the wealth they stole dur­ing their occu­pa­tion of Greece.

The pur­loined Greek cap­i­tal, like that of many oth­er Nazi vic­tims, has not  been repaid.

Fol­low­ing a deci­sion made in August of 1944, the Third Reich trans­ferred its vast assets and secret­ed the wealth into 750 front com­pa­nies in neu­tral coun­tries, where it formed the foun­da­tion of the Bor­mann net­work. That net­work, in turn, admin­is­ters “cor­po­rate Germany”–the Ger­man “core cor­po­ra­tions” and their asso­ci­at­ed finan­cial insti­tu­tions.

It is also worth not­ing that the Nazis loss on the bat­tle­field has been reversed dur­ing the post­war. Ger­many lost the war, but won the post­war.

An impor­tant, inci­sive arti­cle from german-foreign-policy.com (which feeds along the bot­tom of the front page of this web­site) notes the extent of the eco­nom­ic dam­age done to Greece dur­ing both World War II and the post-war, to date.

Note the skilled, decades-long maneu­ver­ing by Ger­many to cir­cum­vent repay­ing wealth loot­ed from Greece and oth­er nations.

“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] . . . .

COMMENT: 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.

“Greece on the Bread­line: Chil­dren of Athens too Hun­gry to Do PE” by Jon Hen­ley; The Guardian; 3/13/2012.

EXCERPT . . . 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. . . .

COMMENT: 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!

“Scan­dal: Greece to Receive ‘Neg­a­tive Cash’ from ‘Sec­ond Bailout’ as It Funds Insol­vent Euro­pean Banks” by Tyler Dur­den; zerohedge.com; 2/22/2012

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! . . .

COMMENT: The Euro­pean Mon­e­tary Union is, as we have seen in many pro­grams and arti­cles, the real­iza­tion of the strat­a­gem of Pan-Ger­man the­o­reti­cian Friedrich List.

Writ­ing in 1943, Paul Win­kler fore­saw that Ger­many would real­ize its goals through the cre­ation and dom­i­na­tion 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.

“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.]”

(The Thou­sand-Year Con­spir­a­cy; by Paul Win­kler; Charles Scrib­n­er’s Sons [HC]; 1943; pp. 15–16.)

COMMENT: 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 dom­inane by a cen­trail­zed Euro­pean eco­nomic union. Ms. Thomp­son was writ­ing in The New York Her­ald Tri­bune on May 31, 1940! Her com­ments are repro­duced by author T. H. Tetens.

. . . . 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. [Empha­sis added.] 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. . . .

Ger­many Plots with the Krem­lin; T.H. Tetens; Hen­ry Schu­man [HC]; 1953; p. 92.


25 comments for “Von Clausewitz, List, the Bormann Capital Network and the Subjugation of Europe”

  1. @ Dave: It is a ter­rif­ic resume of the sit­u­a­tion. Have you ever thought about writ­ing a book? You got one right here. Per­son­al­ly, I nev­er miss an occa­sion on my blog to pub­lish con­tent, videos, arti­cles, any­thing that encour­ages Euro­peans and Euro­pean coun­tries to think in terms of nation-states instead of “Europe”. Some might think that I go too far on the side of nation­al­ism but I pre­fer that to the pas­sive sub­mis­sion to the Euro­pean Union and its insti­tu­tions, which is noth­ing less than the killing of a whole cul­ture and of a dozen peo­ples and/or nation­al­i­ties. And all this becomes pos­si­ble because peo­ple don’t see sol­diers with nazi uni­forms walk­ing down the streets. Hav­ing a low capac­i­ty to detect gam­bits where they are, they buy into the decep­tion. Charles Andler and Dorothy Thomp­son were right. If you know how to do it cor­rect­ly, sol­diers are no longer nec­es­sary.

    Posted by Claude | February 23, 2012, 8:47 pm
  2. Here’s a great video that describes in under 10 min­utes the luna­cy of what’s going on in the euro­zone and how the it’s being con­vert­ed into a giant vin­dic­tive debtors prison designed to pro­tect the banks and impov­er­ish the pub­lic.

    Posted by Pterrafractyl | February 23, 2012, 11:27 pm
  3. Not that it’s sur­pris­ing at this point, but note that one of the most urgent reforms demands by Greece’s new over­lords is a 1.1 bil­lion euro reduc­tion in state spend­ing on phar­ma­ceu­ti­cals. Nice pri­or­i­ties:

    Athens Told to Change Spend­ing and Tax­es
    Pub­lished: Fri­day, 24 Feb 2012 | 1:50 AM ET

    By: Peter Spiegel, Ger­rit Wies­mann & Kerin Hope Finan­cial Times

    Euro­pean cred­i­tor coun­tries are demand­ing 38 spe­cif­ic changes in Greek tax, spend­ing and wage poli­cies by the end of this month and have laid out extra reforms that amount to micro­manag­ing the country’s gov­ern­ment for two years, accord­ing to doc­u­ments obtained by the Finan­cial Times.

    The reforms, spelt out in three sep­a­rate mem­o­ran­da of a com­bined 90 pages, are the price that Greece has agreed to pay to obtain a 130 bil­lion euros sec­ond bail-out and avoid a sov­er­eign default that the gov­ern­ment feared would throw Greek soci­ety into tur­moil.

    They range from the sweep­ing – over­haul­ing judi­cial pro­ce­dures, cen­tral­is­ing health insur­ance, com­plet­ing an accu­rate land reg­istry – to the mun­dane – buy­ing a new com­put­er sys­tem for tax col­lec­tors, chang­ing the way drugs are pre­scribed and set­ting min­i­mum crude oil stocks.

    “The pro­gram is much, much more ambi­tious than eco­nom­ic reform,” said Mujta­ba Rah­man, Europe ana­lyst at the Eura­sia Group risk con­sul­tan­cy. “This is state build­ing, as typ­i­cal­ly under­stood in tra­di­tion­al low-income con­texts.”

    Most urgency is attached to a 10-page list of “pri­or actions” that must be com­plet­ed by Wednes­day in order for euro zone finance min­is­ters to give a final sign-off to the new bail-out at an emer­gency meet­ing sched­uled for Thurs­day.

    The 38 mea­sures are a mix of laws that must be passed by par­lia­ment, min­is­te­r­i­al deci­sions and pres­i­den­tial decrees that affect a com­plete cross-sec­tion of Greek eco­nom­ic activ­i­ty, from health spend­ing to munic­i­pal admin­is­tra­tion to tax col­lec­tion.

    Only a hand­ful of the mea­sures are list­ed as passed or in the process of being imple­ment­ed, includ­ing a high­ly pub­li­cised 300 mil­lion euros in pen­sion reduc­tions and 325 mil­lion euros in oth­er spend­ing cuts. The oth­er reforms are grouped under six cat­e­gories, though most of the changes fall under spend­ing cuts, bank reg­u­la­tions, and eco­nom­ic reforms.

    Among the mea­sures that must be com­plet­ed in the next sev­en days are reduc­ing state spend­ing on phar­ma­ceu­ti­cals by 1.1 bil­lion euros; com­plet­ing 75 full-scale audits and 225 val­ue added tax audits of large tax­pay­ers; and lib­er­al­is­ing pro­fes­sions such as beau­ty salons, tour guides and diet cen­tres.


    Sim­i­lar­ly, a delay in reforms of health­care pro­cure­ment, which are opposed by doc­tors, med­ical sup­pli­ers and hos­pi­tal man­agers, meant that sav­ings of only 500 mil­lion euros were achieved in 2011 against a tar­get of 1 bil­lion euros, leav­ing the miss­ing amount to be col­lect­ed this year.

    Mr Rah­man said the scale and the speed of the reforms demand­ed raised ques­tions about whether scep­ti­cal euro zone lenders were set­ting up Greece to fail some­time with­in the next year.

    “Even if one under­stands the polit­i­cal imper­a­tive, the pro­gram is being set up to fail as many of the tar­gets will be impos­si­ble to achieve,” he said.

    Posted by Pterrafractyl | February 24, 2012, 9:06 am
  4. The imag­ined spec­ta­cle of auc­tion­ing off the Parthenon may or may not take place but what is hap­pen­ing less dra­mat­i­cal­ly in Greece is the loss of pri­vate prop­er­ty by the mid­dle class. That process of grind­ing attri­tion does­n’t make the news.

    The uni­fi­ca­tion and homog­e­niza­tion of cus­toms was a pri­ma­ry method of Ger­man uni­fi­ca­tion in the 19th cen­tu­ry. In enforc­ing that, a sub­tle kind of mar­tial law was imposed that cre­at­ed mod­ern Ger­many. That tem­plate worked well inside Ger­many and now out­side as well. Empire by bureau­crat­ic and eco­nom­ic encroach­ment is suc­ceed­ing for the Reich.

    Posted by Dwight | March 5, 2012, 7:19 am
  5. The CS Mon­i­tor has an inter­est­ing pair of pieces that attempt to sum­ma­rize the pro-aus­ter­i­ty and anti-aus­ter­i­ty argu­ments. They’re both worth a read. And if the pro-aus­ter­i­ty sum­ma­ry is accu­rate, Europe is pret­ty screwed because it’s look­ing more and more like Berlin con­sen­sus is increas­ing­ly look­ing like the GOP-style mag­i­cal think­ing that gut­ted the US’s econ­o­my: They have an ide­o­log­i­cal cer­tain­ty that nation­al divest­ment and gut­ting of the safe­ty-net will def­i­nite­ly work (giv­en enough time), it’s the only option for clos­ing the “com­pet­i­tive­ness” gap, and they’re get­ting tired of all the com­plaints.

    Posted by Pterrafractyl | March 15, 2012, 10:08 pm
  6. @Pterrafractyl–

    The Ger­mans are los­ing patience? I find that hard to believe. (Sar­casm).

    Recall that, in keep­ing with von Clause­witz, you don’t have to machine gun some­body or put them in a gas cham­ber and drop the Zyk­lon B pel­lets.

    Deny them prop­er employ­ment, nutri­tion, cloth­ing, shel­ter, med­ical care and bin­go, the job is done!

    Posted by Dave Emory | March 15, 2012, 11:11 pm
  7. The pro-aus­ter­i­ty argu­ments assume that max­i­miz­ing dig­its in a few select­ed bank accounts, while ignor­ing human tragedy, is a valid goal. In any sane prim­i­tive tribe fac­ing a harsh win­ter, aus­ter­i­ty would mean hold­ing all one’s assets very close and shar­ing them equal­ly among one’s own. The Greeks just agreed to what amounts to a par­tial default, even if no one is call­ing it that. They should default com­plete­ly and right away, restore their own cur­ren­cy and severe­ly restrict for­eign own­er­ship and cap­i­tal flight. Any­thing else they can think of that makes a Frank­fort or Paris banker scream is auto­mat­i­cal­ly the right thing to do.
    Of course, if all that hap­pened, NATO would ‘lib­er­ate’ them.

    Posted by Dwight | March 16, 2012, 4:39 am
  8. @Dwight: Yeah, the aus­ter­i­ty argu­ments are like a school teacher deal­ing with poor­ly per­form­ing stu­dents. Approach­es like extra home­work, tutor­ing, and address­ing mal­nu­tri­tion at home are con­sid­ered unac­cept­ably “soft”. Instead, the teacher resorts to pub­lic humil­i­a­tion, beat­ings with a rod AND, just to show the teacher is seri­ous, con­fis­ca­tion of the text­books with the lin­ger­ing threat of paper and pen­cil con­fis­ca­tion if the stu­dent does­n’t improve with­in a semes­ter. I guess there’s maybe 0.1% or so of the pop­u­lace that might actu­al­ly improve aca­d­e­m­i­cal­ly after such treat­ment, but gen­er­al­ly speak­ing that teacher should be fired because they are destroy­ing those chil­dren’s futures.

    Posted by Pterrafractyl | March 16, 2012, 7:56 am
  9. It’s also worth point­ing out that Berlin isn’t the only EU cap­i­tal infest­ed with junk socioe­co­nom­ic ide­olo­gies:

    George Osborne poised to slash top tax rate from 50p to 40p

    Chan­cel­lor’s dra­mat­ic move to cut top rate of income tax in next week’s bud­get will delight the Con­ser­v­a­tive right
    Patrick Win­tour, polit­i­cal edi­tor
    guardian.co.uk, Thurs­day 15 March 2012 17.30 EDT

    George Osborne is poised to slash the top rate of income tax from 50p to 40p in next week’s bud­get in a dra­mat­ic move that will delight busi­ness and the Tory right, but risks rein­forc­ing the Con­ser­v­a­tives’ rep­u­ta­tion as pro­tec­tors of the super-rich.

    With the four senior min­is­ters in the bud­get dis­cus­sions due to speak on Fri­day and a final meet­ing sched­uled for Mon­day, the Lib­er­al Democ­rats appear to recog­nise that they are not going to be able to block what is Osborne’s key demand for the bud­get, but are try­ing to max­imise the con­ces­sions they can extract in return.

    Gov­ern­ment sources say that from the out­set the chan­cel­lor has seen a cut in the 50p rate as the head­line-grab­bing mea­sure of the bud­get, and views it as the sim­plest sin­gle step he can take to show his com­mit­ment to an enter­prise econ­o­my.


    It is under­stood that the dri­ve to cut the top rate is com­ing from Osborne as much as David Cameron. The chan­cel­lor has, sources say, been intel­lec­tu­al­ly per­suad­ed of the case for a cut in the top rate, a move that will endear him to the Tory right.

    A gov­ern­ment source said: “The bud­get has to strike a bal­ance. It has to show we are all in this togeth­er, but it also has to show that as a coun­try we are open for busi­ness. We want a top rate that does not put off entre­pre­neurs or busi­ness­es. It is one of the high­est top rates world­wide at a time when we need real growth. Above all, real growth is what we need to pro­mote wealth and pros­per­i­ty.” The source said the deal on the 50p was not yet done and dust­ed, but was close to being so.


    Posted by Pterrafractyl | March 16, 2012, 9:15 am
  10. @Dave: Sad but so true.

    @Dwight: Per­haps so. I think Voridis might just be the elites’ man in Greece.

    Posted by Steven L. | March 16, 2012, 9:19 am
  11. There’s a NY Times arti­cle on the firm that’s appar­ent­ly become the “SWAT” team for fin­cial­ly-dis­tressed coun­tries across the globe, includ­ing Greece:

    NY Times
    March 19, 2012, 2:02 pmIn­vest­ment Bank­ing
    In Greek Cri­sis, a Lit­tle-Known Advis­er With Out­size Influnce


    ATHENS — In unmarked offices here on a dusty block choked with strip clubs and burned-out build­ings, sev­er­al dozen employ­ees of a Wall Street firm spent months por­ing over bank loan port­fo­lios as Greece strug­gled with its debt cri­sis.

    They belong to what has become the go-to SWAT team in finan­cial crises. Their employ­er, Black­Rock, may be lit­tle known out­side finan­cial cir­cles even as it man­ages a world-lead­ing $3.51 tril­lion of assets, but the firm is exert­ing enor­mous influ­ence as a behind-the-scenes advis­er to trou­bled gov­ern­ments around the globe.

    In Greece, Black­Rock is help­ing deter­mine just how much cap­i­tal the country’s banks will need to raise in the com­ing months. It is a cru­cial step as Greece tries to fix its bank­ing indus­try and its broad­er econ­o­my, but the task is a risky one.

    Set the cap­i­tal lev­els too low and finan­cial firms may not have an ade­quate cush­ion to with­stand fur­ther loss­es. Set the bar too high and the banks may strug­gle to find investors will­ing to come up with the mon­ey. In either sit­u­a­tion, the gov­ern­ment could be forced to step in

    Black­Rock knows the stakes. Along with Greece, the finan­cial firm has advised the Irish gov­ern­ment and the British Trea­sury. In Ire­land, BlackRock’s find­ings formed the basis of a bank’s effort to raise an addi­tion­al $34 bil­lion. The Unit­ed States Trea­sury hired Black­Rock dur­ing the 2008 finan­cial cri­sis to help val­ue real estate and oth­er assets the gov­ern­ment was acquir­ing as it stepped in to bail out tee­ter­ing finan­cial firms like the Amer­i­can Inter­na­tion­al Group.

    The exec­u­tive who leads these efforts, Craig Phillips, keeps a poster of the movie “The Exor­cist” in his office, say­ing that he sees his job as help­ing gov­ern­ments and com­pa­nies con­front their prob­lems. “We have been con­di­tioned to be ultra­respon­sive,” he said.

    The appeal of Black­Rock is that it has the size, sys­tems and exper­tise to scour and ana­lyze huge vol­umes of finan­cial data quick­ly. In Greece, for exam­ple, it reviewed 10 mil­lion loans in about three months. Anoth­er attrac­tion is that unlike oth­er finan­cial firms — say, Gold­man Sachs — Black­Rock is not known for mak­ing splashy bets that can land it in the head­lines. It has large­ly flown beneath the public’s radar.

    Yet Black­Rock is no stranger to con­tro­ver­sy. In the Unit­ed States, the firm — which makes most of its prof­its by man­ag­ing mon­ey for investors, pen­sion funds, endow­ments and oth­er insti­tu­tions — has been crit­i­cized for buy­ing and sell­ing some of the same secu­ri­ties that its Black­Rock Solu­tions unit is valu­ing for the gov­ern­ment. Few firms have such access to a vast amount of mar­ket-mov­ing infor­ma­tion, and that, some crit­ics say, presents a poten­tial con­flict of inter­est.

    “Imag­ine you con­sult with Greece and you see the inside issues and you real­ize with greater cer­tain­ty it’s going to go a cer­tain way,” said Robert Jar­row, a pro­fes­sor of finance at Cor­nell Uni­ver­si­ty. “How could you not make invest­ment deci­sions based on that?”

    Eye­brows were raised in Greece when the firm was approached to han­dle loan val­u­a­tion work for a friend­ly merg­er in Greece between two banks it had just reviewed. Black­Rock said it hadn’t made a deci­sion on whether to accept this assign­ment. Mr. Phillips added that the com­pa­ny had inter­nal guide­lines, which are in place to “man­age actu­al and per­ceived con­flicts of inter­est.”


    To help sta­bi­lize the sys­tem, the Bank of Greece looked for a firm to review the loan port­fo­lios of 18 finan­cial firms. Bank of Greece asked Black­Rock and three oth­er firms, Black­stone, Oliv­er Wyman and Alvarez & Marsal, to sub­mit a pro­pos­al on how each would go about valu­ing the port­fo­lios.


    In a city at times rocked by vio­lent protests, Black­Rock sought a low pro­file. Employ­ees were not allowed to car­ry or wear any­thing bear­ing the com­pa­ny logo. The firm hired 18 armed secu­ri­ty guards to trans­port employ­ees in vans or, in rare cas­es, on motor­cy­cles. Black­Rock even had a code name: Solar, lead­ing some ten­ants in its office build­ing to think the team was a solar ener­gy com­pa­ny.

    As part of the assign­ment, Black­Rock gath­ered infor­ma­tion on mil­lions of loans and used the data to cre­ate a view of the loss poten­tial on the port­fo­lios. The banks set up data rooms for Black­Rock and uploaded infor­ma­tion, allow­ing the firm to see things like col­lat­er­al and pay­ment his­to­ry.

    Black­Rock and the banks butted heads on some issues. For instance, Black­Rock want­ed to write all loans backed by third-par­ty guar­an­tees to zero, since they were riski­er than those backed by collateral.The banks resist­ed, but “in the end there was no room for debate,” said George Aro­nis, also of Alpha Bank. The loans were writ­ten down to zero.

    Jes­si­ca Tan and Charles Hata­mi, two of BlackRock’s day-to-day man­agers in Greece, said that they were sur­prised by both the qual­i­ty of the data and the results. Most insti­tu­tions, they said, did not lend reck­less­ly, as the Unit­ed States banks did dur­ing the real estate boom.

    “The con­sumer lend­ing mar­ket is rel­a­tive­ly new in Greece, and they were dis­ci­plined in their approach,” Mr. Phillips of Black­Rock said. “Unlike oth­er coun­tries, the Greek con­sumer is not debt laden.”

    Maria Mavri­dou, alter­nate direc­tor of finan­cial sta­bil­i­ty at the Bank of Greece, said that BlackRock’s find­ings were like­ly to be released in the com­ing weeks by the gov­ern­ment. The report will describe the cur­rent state of the Greek bank­ing sys­tem and out­line addi­tion­al cap­i­tal require­ments.

    “They didn’t know any­thing about Greece, but they sure know data and what to do with it,” she said.

    There’s anoth­er addi­tion­al piece of info that one should know about Black­rock­’s pedi­gree: The Black­rock was start­ed as a divi­sion of Pete Peter­son­’s and Steven Schwar­man’s asset-man­age­ment firm Black­stone. This is the same Steven Schwarz­man that com­pared Oba­ma to Hitler over tax increas­es for the rich and the same Pete “aus­ter­i­ty” Peter­son that is spend­ing $1 bil­lion of his own for­tune to con­vince the pub­lic that we just can’t afford things like social secu­ri­ty and medicare unless, of course, we pri­va­tize the sys­tem and hand it over to the asset-man­agers. Con­sid­er­ing that Schwarz­man’s and Peter­son­’s Black­stone firm is also in the run­ning for this
    type of con­sult­ing work, it’s not like the most pro-aus­ter­i­ty firm on the plan­et is being cho­sen to design dis­tressed bank­ing sys­tem over­hauls, but still...

    Posted by Pterrafractyl | March 20, 2012, 6:23 pm
  12. Huh, Spain’s polit­i­cal estab­lish­ment is a lit­tle con­cerned that vot­ers are find­ing out that the new con­ser­v­a­tive Prime Min­is­ter bla­tant­ly lied to the vot­ers about his plans for aus­ter­i­ty poli­cies. The con­cern isn’t about the actu­al lying...it’s con­cern about how Spain’s elites are going to have the cred­i­bil­i­ty to con the vot­ers into more aus­ter­i­ty in the future:

    Rajoy’s ploys risk stok­ing cyn­i­cism
    By Hugo Dixon
    March 19, 2012

    At a din­ner in Madrid ear­li­er this month, the main com­plaint about Mar­i­ano Rajoy was that the new prime min­is­ter was treat­ing the elec­torate like chil­dren. Many of the guests, sup­port­ers of Rajoy’s Pop­u­lar Par­ty (PP), under­stood that Spain had to cut its fis­cal deficit and restore its com­pet­i­tive­ness. But they didn’t like the fact that the prime min­is­ter hadn’t been frank about his plans.

    In advance of last November’s gen­er­al elec­tion, Rajoy said he wouldn’t raise tax­es, make it cheap­er to fire peo­ple or cut the wel­fare state. But he has now done the first two. After this week’s elec­tion in Andalu­sia, Spain’s largest region, he is expect­ed to do the last.

    Rajoy’s camp doesn’t see any prob­lem in fail­ing to be upfront. It would have been fool­ish to talk too much about aus­ter­i­ty in the gen­er­al elec­tion cam­paign as that might have fright­ened the vot­ers. For the same rea­son, it would be fool­ish to tell them about reform­ing the wel­fare state in advance of the Andalu­sia elec­tion.

    In the long run, the fail­ure to treat the pop­u­la­tion like adults could cause trou­ble. But in the short run, the strat­e­gy has paid off. The social­ist par­ty lost near­ly 40 per­cent of its votes in the gen­er­al elec­tion, not least because it had done a poor job in gov­ern­ment. It is now expect­ed to lose con­trol of Andalu­sia, its last main bas­tion, accord­ing to an opin­ion poll by Met­ro­scopia.

    Rajoy has already used the absence of any seri­ous oppo­si­tion – even a gen­er­al strike called for next week doesn’t pose much threat – to push through one batch of reforms. The most impor­tant is of the labour mar­ket. He has made it cheap­er for com­pa­nies to fire peo­ple and large­ly dis­man­tled the nation­wide sys­tem of col­lec­tive bar­gain­ing. The net effect will be that wages, which rose rapid­ly dur­ing the ear­ly years of the sin­gle cur­ren­cy, will fall – so restor­ing Spain’s com­pet­i­tive­ness.


    This won’t mat­ter if the econ­o­my, which the gov­ern­ment expects to shrink 1.7 per­cent this year, sta­bilis­es next year. But what if GDP keeps shrink­ing, unem­ploy­ment (now 23 per­cent) con­tin­ues ris­ing and the deficit remains stub­born­ly high? Spain would face renewed bond mar­ket jit­ters and fur­ther pres­sure from its euro part­ners to cut its deficit. Rajoy would then have to sell anoth­er dose of aus­ter­i­ty to vot­ers that wouldn’t believe him. Hav­ing treat­ed them like kids, they might even throw a tantrum.

    Posted by Pterrafractyl | March 20, 2012, 7:15 pm
  13. “Moral decay”. Yeah, that sounds about right:

    EU Treat­ment of Greece Shows ‘Moral Decay’: Econ­o­mist

    Pub­lished: Tues­day, 20 Mar 2012 | 1:24 AM ET

    By: Katy Bar­na­to
    Assis­tant Edi­tor, CNBC

    Euro­pean Union lead­ers showed “moral decay” in delay­ing Greece’s bond swap deal in order to min­i­mize the impact on the region’s banks, accord­ing to High Fre­quen­cy Eco­nom­ics’ founder and chief econ­o­mist, Carl Wein­berg.

    In a March report on the glob­al econ­o­my, Wein­berg said EU lead­ers had delib­er­ate­ly delayed Greece’s restruc­tur­ing, to the detri­ment of its econ­o­my, in order to give banks time to pre­pare for the hit on their debt hold­ings.

    “Why wasn’t Greece allowed to restruc­ture its debt two years ago, before its econ­o­my con­tract­ed by 15 per­cent, and before it was nec­es­sary to impose a hair­cut on pri­vate sec­tor bor­row­ers, desta­bi­lize the gov­ern­ment and the econ­o­my, ille­gal­ly imple­ment retroac­tive col­lec­tive action claus­es, and trig­ger cred­it default swaps?” he asked in the report.

    “It was incon­ve­nient for the banks, that is why,” he said.

    Wein­berg added that EU lead­ers forced Greece to go through severe aus­ter­i­ty mea­sures in order to give banks time to deal with the debt.

    Politi­cians pre­ferred to put a few mil­lion Greek cit­i­zens through the ringer than ask banks to swal­low loss­es on gov­ern­ment bonds before they had time to ‘pre­pare’… it would seem that it is not just bankers who have entered an era of moral decay, but the gov­ern­ments that want to reg­u­late them as well,” he wrote.


    Of course, for moral “decay” to take place it assumes a giv­en bankster/politician/associated min­ion would have been unwill­ing to impov­er­ish their fel­low cit­i­zens before the finan­cial cri­sis and weren’t just wait­ing for the right cri­sisoppor­tu­ni­ty to right all the wrongs that emerged over the few cen­turies (like a mid­dle-class, non-junk eco­nom­ic the­o­ries, demo­c­ra­t­ic ideals, etc....). There are some indi­vid­u­als push­ing mass aus­ter­i­ty that seem like they might have expe­ri­enced their moral decay a while ago.

    Posted by Pterrafractyl | March 22, 2012, 9:47 pm
  14. [...] davan­tage d’information sur ce sujet, vis­itez cette page web. This entry was post­ed in Resis­tance. Book­mark the perma­link. ← Jared Lough­n­er, shoot­er [...]

    Posted by Bienvenue | Lys-d'Or | April 8, 2012, 7:40 pm
  15. Here’s one more arti­cle about how a cri­sis in euro­zone cri­sis isn’t just a cri­sis. It’s a fea­ture. The fact that the his­tor­i­cal­ly low inter­est rates and oth­er var­i­ous stim­u­lus mea­sures tak­en by the ECB are actu­al­ly help­ing Ger­man firms more than P.I.I.G.S. cor­po­ra­tions also high­lights anoth­er inter­est­ing char­ac­ter­is­tic of euro­zone econ­o­my: The “inter­nal deval­u­a­tion” of the P.I.I.G.S.‘s economies that the Bun­des­bank is con­tin­u­al­ly demand­ing isn’t sim­ply over con­cerns about “com­pet­i­tive­ness” and deficits (as BS-filled as those con­cerns may be). The jaw-bon­ing about “com­pet­i­tive­ness” and the demand that the weak­er euro­zone economies slash their stan­dards of liv­ing and send their economies into a tail­spin is also about infla­tion. The Bun­des­bank is demand­ing basi­cal­ly min­i­mal infla­tion and if you want sus­tained finan­cial stim­u­lus (like ultra low bor­row­ing rates for cor­po­ra­tions and tril­lions of euros in ECB asset pur­chas­es) and basi­cal­ly no infla­tion, you’re going to have to “inter­nal­ly deval­ue” a chunk of your econ­o­my. If you think of the euro­zone mem­bers nations as com­part­men­tal­ized “chunks” of the large euro­zone ecosys­tem, what we’re see­ing is a net over­all stim­u­lus for the euro­zone because the stim­u­lus poli­cies aren’t tar­get­ting the eco­nom­ices in cri­sis but instead the entire euro­zone, and in order to hold down over­all infla­tion for the euro­zone as a whole the weak­er nations are being tar­get­ted for mas­sive defla­tion­ary poli­cies to act as a sort of “infla­tion buffer” for the larg­er euro­zone econ­o­my. It’s a fea­ture.

    Posted by Pterrafractyl | April 19, 2012, 1:57 pm
  16. Atrios has an rel­e­vant ques­tion for Pim­co’s Mohamed El-Erian about his lat­est piece in the WaPo: What does “stream­lin­ing enti­tle­ments” even mean? Will Grand­ma and Gram­pa get their social secu­ri­ty checks in a fanci­er, more aero­dy­nam­ic enve­lope or is this the the Paul Ryan kind of stream­lin­ing?

    Sim­i­lar­ly, what exact­ly did El-Erian mean when he said this:

    PIMCO’s El-Erian: A Glob­al Realign­ment Our Grand­chil­dren Will Talk About
    Investors must absorb mar­ket blows, be agile enough to react quick­ly
    By John Sul­li­van, Advi­sorone

    May 4, 2012


    “Europe under­stands this list now, but the imple­men­ta­tion of its com­po­nents lags,” El-Erian said. “It went from sta­ble to ‘bimodal’ with fat tails. What will Europe be in a year? There is a high prob­a­bil­i­ty there will be a re-found­ing of Europe using the West and East Ger­many as a mod­el. There is a low­er prob­a­bil­i­ty it will frag­ment. If that hap­pens it will be a total mess for Europe and the world. But it will tip one way or anoth­er and either way will be bumpy.”

    The Unit­ed States is a house in their neigh­bor­hood, and there­fore Amer­i­cans should be con­cerned, he con­tin­ued.

    Ger­many needs a part­ner, which is one rea­son you see a Ger­man chan­cel­lor active­ly cam­paign­ing for a French pres­i­dent. That is very unusu­al but they have a good rela­tion­ship; basi­cal­ly, Merkel makes the deci­sions and Sarkozy explains them to the world,” he quipped to laugh­ter from the audi­ence.

    As far as the fourth point, the par­al­lels between Europe and the rest of the world are:

    The robust­ness of the U.S. econ­o­my is fac­ing struc­tur­al imped­i­ments to growth
    The U.S. pol­i­cy response from the Fed is “tac­ti­cal­ly smart” but strate­gi­cal­ly short-sight­ed
    There is a large and grow­ing depen­den­cy on poli­cies that fun­da­men­tal­ly change the func­tion­ing of the mar­kets
    Out­er coun­tries in many oth­er parts of the world are not will­ing to move to the cen­ter
    There is a ques­tion of how the glob­al eco­nom­ic sys­tem will evolve from here.

    He con­clud­ed with the impli­ca­tions for invest­ing, which he called the “Great Escape.”

    “In the short term, investors must escape the world of delever­ag­ing. They must stay in the game as oth­ers try to pick their pock­ets in the mar­ket.”

    Com­par­ing investors to Muham­mad Ali’s strat­e­gy for beat­ing George Fore­man in the “Rum­ble in the Jun­gle,” he said investors must be able to absorb mar­ket blows and be agile enough to react quick­ly.

    We are liv­ing in a glob­al realign­ment that our chil­dren and grand­chil­dren will be talk­ing about. We can’t see it, because we are so close to it, but make no mis­take, it’s there.”

    Ok, first off, which are the “Out­er” coun­tries of the world that are not will­ing to “move to the cen­ter”. Is this North Kore­an “out­er­ness” or Ice­landic “out­er­ness” because those are two very “out­er” coun­tries in the world?

    And sec­ond­ly, what exact­ly is the “West and East Ger­many” mod­el sup­posed to look like when applied to the euro­zone? I mean, I under­stand that there’s going to be a wave of pri­va­ti­za­tions of state assets like with what hap­pened dur­ing the Ger­man reuni­fi­ca­tion. But what about the oth­er side of the coin:

    Study shows high cost of Ger­man reuni­fi­ca­tion: report

    BERLIN | Sat Nov 7, 2009 11:30am EST

    (Reuters) — As Ger­many pre­pares to cel­e­brate the 20th anniver­sary of the fall of the Berlin Wall, a new study shows that some 1.3 tril­lion euros ($1.9 tril­lion) have been trans­ferred from the west to rebuild the east, a news­pa­per report­ed on Sat­ur­day.

    The report by the Halle-based IWH research insti­tute showed the net trans­fers from west to east — a sum equiv­a­lent to over half Ger­many’s total eco­nom­ic out­put in 2008 — had “risen sig­nif­i­cant­ly” in the past decade, week­ly Welt am Son­ntag said.

    Mon­day will be the 20th anniver­sary of the fall of the Wall, which the once-divid­ed city will mark by top­pling 1,000 bright­ly col­ored domi­noes that were being erect­ed on Sat­ur­day along a 1.5 kilo­me­ter stretch of the Cold War bar­ri­er’s orig­i­nal path.

    The east has cast off many shack­les from its Com­mu­nist past, thanks part­ly to the trans­fers, but unem­ploy­ment remains near­ly dou­ble that of the west and econ­o­mists say it is still years away from catch­ing up with the rich­er part of the coun­try.


    So where are the tril­lions of euros in state aid? Is that sup­posed to be a sur­prise gift after the P.I.I.G.S. act like good lit­tle plebes or is the Ger­man reuni­fi­ca­tion mod­el per­haps not the best ana­log for this his­toric glob­al realign­ment?

    So many awful ques­tions and only awful answers. At least future gen­er­a­tions will get to share in the long-term awful­ness after this crop of humans is done build­ing a glob­al gulag of cor­po­rate rule and knee-capped gov­ern­ments every­where glob­al realign­ment, so there’s that. And shar­ing is a good thing, right?

    Posted by Pterrafractyl | May 4, 2012, 9:11 am
  17. Here’s a free tip to the states and coun­tries that are about to see their rev­enue-gen­er­at­ing infra­struc­ture pri­va­tized: Read the fine print.

    Posted by Pterrafractyl | May 4, 2012, 10:02 am
  18. @Pterrafractyl
    I was just catch­ing up with some of your posts and I could­n’t let it go with­out men­tion, as I have done in the past, that I work for a com­pa­ny owned in part by Bain Capital...the oth­er part is owned by Black­stone! This very direct con­nec­tion between Rom­ney and the aus­ter­i­ty cler­ics cur­rent­ly pil­lag­ing Europe should come as no sur­prise, and yet, I am struck near­ly dumb at the final real­iza­tion that my livelihood—such as it is—contributes even a small morsel to their despi­ca­ble enter­prise.

    I must find a new job. Until then, I’m a mole, I’m a mole. Or maybe a can­cer with­in a can­cer.

    Posted by GrumpusRex | May 5, 2012, 10:27 am
  19. @GrumpusRex: Any inside infor­ma­tion that you have, my friend, might prove to be use­ful. If you see, read or hear some­thing you think may even be remote­ly impor­tant, might not be a bad idea to keep in touch, IMO. =)

    Posted by Steven L. | May 5, 2012, 6:15 pm
  20. @Grumpusrex: Heh, don’t beat your­self up too much. I think at this point you damn near have to engage in barter to tru­ly avoid enabling an oli­garch. Non-oli­garch-owned busi­ness are hand­ing plen­ty of prof­its over the oli­garchs. It’s an inevitabil­i­ty woven into the fab­ric of our econ­o­my. The “cost of doing busi­ness” that involve buy­ing any­thing — from basic com­modi­ties, intermediate/refined prod­ucts, or the final con­sumer good — will some­how involve buy­ing from an oli­garch-owned indus­try. And the less refined the prod­uct, the more like­ly it is that it’s from an oli­garch-run sec­tor of the econ­o­my (get the first “cut” on the resource). At least, that’s a gen­er­al pat­tern I’ve observed: aside from the finan­cial sec­tor, there are just an enor­mous num­ber of oli­garchs that have their empires root­ed in the extrac­tion some nat­ur­al resource (mining/oil/agriculture). That’s espe­cial­ly true for the devel­op­ing-world oli­garchs where nat­ur­al resource extrac­tion is one of the pri­ma­ry things the coun­try has to trade with the world (so, of course, that wealth from extract­ed local resources gets extract­ed by elite ass­holes, local and glob­al).

    So even if some­one isn’t work­ing direct­ly for an oli­garch-owned firm near­ly all of us are some­how enabling our oli­garchs, direct­ly or indi­rect­ly, local and glob­al.

    It’s sys­tem­i­cal­ly inevitable that you end up with an econ­o­my like this when so many indus­tries are allowed to col­lapsed to hand­ful of core com­pa­nies. That eco­nom­ic con­cen­tra­tion has been a gen­er­al trend for decades and it’s Rom­ney & Friends that end­ed up being both the most influ­en­tial own­ers (not nec­es­sar­i­ly biggest, but most influ­en­tial), and the deal-mak­ers of the trans­ac­tions that cre­at­ed our new­ly con­cen­trat­ed econ­o­my. Mit­tens took his mil­lions and made bil­lions that core. and not just due to cor­rup­tion and inten­tion­al rig­ging. The “Free-mar­kets” that are large­ly free of anti-trust enforce­ment are just going to see the exist­ing monopolies/oligopolies just take over more and more indus­tries and cre­ate an econ­o­my where some group of oli­garchs cap­tures the prof­its all along a grow­ing num­ber of sup­ply chains and sec­tors. And they’ll be inter­wo­ven sup­ply chains and sec­tors as this goes on over the decades.

    And, in due time, you’ll end up with some­thing awful like the mod­ern econ­o­my, where not only are our actions increas­ing­ly com­modi­tized in an oli­garch-friend­ly way but now, in the obser­va­tion-for-prof­it age, our com­modi­tized actions are being tracked for even more prof­it. And, not sur­pris­ing­ly, our com­mer­cial­ized actions are increas­ing­ly inter­wo­ven, both in work and play, at home and out and about. Between Google, Face­book, smartphone/cell activ­i­ty, gen­er­al inter­net track­ing, and all our non-cash com­mer­cial activ­i­ty we are cre­at­ing a world where basic day to day activ­i­ties are prof­it­ing many of our crap­pi­est oli­garchs.

    So don’t wor­ry too much about work­ing sev­er­al degrees removed from Bain. We all are. The world has become a sick ver­sion of Six Degrees of Kevin Bacon, but with Mitt as our real­i­ty-mag­net. And you could swap Mitt out for any of his oth­er oli­garch bud­dies although they might not be as telegenic (although I have to say I’ve been sur­prised by the gaffe-rate by Rom­ney. He’s not exact­ly new at this). And most of us are some­one work­ing for, direct­ly or indi­rect­ly, at least one of those oli­garchs. That’s what an oli­garchy looks like. And that’s what real­i­ty should feel like. That it does­n’t feel like that to every­one — feel your Mit­tness folks, it cours­es through your real­i­ty — is one of the big chal­lenges of the day.

    As peo­ple say: it’s their world, we’re just liv­ing in it. Part of what makes Mit­tens so scary is that he seems to be the front man for the tran­si­tion to the world where it’s not just their world we’re liv­ing in. It’s their world, and we’re just liv­ing in it at their dis­cre­tion. What Mit­tens did as a cor­po­rate raider is what he’s going to do as a pres­i­dent except replace “cor­po­rate enti­ties” with “swaths of society/Grandma”. It’s Mit­t’s Amer­i­ca.

    Posted by Pterrafractyl | May 5, 2012, 9:07 pm
  21. @Pterrafractyl: Well said. I agree.

    Posted by Claude | May 6, 2012, 12:54 pm
  22. Shared sac­ri­fice:

    Rajoy Says He May Use Pub­lic Funds to Clean Up Span­ish Banks
    By Charles Pen­ty and Emma Ross-Thomas — May 7, 2012 4:22 AM CT

    Span­ish Prime Min­is­ter Mar­i­ano Rajoy opened the door to using pub­lic funds to clean up Span­ish lenders and said the gov­ern­ment will pass a decree this week to bol­ster con­fi­dence in the banks.

    The last thing I want to do is lend pub­lic mon­ey, as has been done in the past, but if it were nec­es­sary to get the cred­it to save the Span­ish bank­ing sys­tem, I wouldn’t renounce that,” he said in an inter­view with radio sta­tion Onda Cero today. He didn’t give details on the decree that will be passed on May 11.

    Spain’s gov­ern­ment tight­ened pro­vi­sion­ing rules in Feb­ru­ary to make banks rec­og­nize deep­er real-estate loss­es and is now work­ing on a plan to allow lenders to offload writ­ten-down assets into sep­a­rate vehi­cles. Spain has tried to shield its pub­lic finances from the cost of clean­ing up the banks and ruled last year that the indus­try would bear the cost of restruc­tur­ing failed lenders.

    Rajoy said the gov­ern­ment hasn’t decid­ed whether pub­lic funds will be used and in any case it wouldn’t affect the deficit, which is the third largest in the euro region. Using pub­lic funds would be a “last resort,” he said.

    “I am not in favor of a bad bank,” Rajoy said. “The main aim of the decree is that there should be no doubts about the sit­u­a­tion of Span­ish banks.”


    Posted by Pterrafractyl | May 7, 2012, 6:46 am
  23. This is a pret­ty inter­est­ing con­tin­u­a­tion of the Ger­man war prin­ci­ple...


    Posted by GW | May 7, 2012, 7:27 am
  24. Win­ning hearts and minds:

    Ger­many unmoved by anti-aus­ter­i­ty votes in Europe

    Mon May 7, 2012 10:42am EDT

    * Ger­many shows lit­tle flex­i­bil­i­ty on aus­ter­i­ty course

    * French, Greek votes seen as rejec­tion of Merkel approach

    * Hol­lande speech in Tulle seen as sig­nal in Berlin

    * New French leader due in Berlin next week

    By Noah Barkin and Stephen Brown

    BERLIN, May 7 (Reuters) — Ger­many is rul­ing out any sub­stan­tive shift in its approach to Europe’s debt cri­sis despite a ris­ing cho­rus of oppo­si­tion to Berlin’s aus­ter­i­ty poli­cies that reached a crescen­do in Sun­day’s elec­tions in Greece and France.

    Chan­cel­lor Angela Merkel, speak­ing in Berlin on Mon­day, reject­ed the notion that Europe was on the brink of a major pol­i­cy shift after Social­ist Fran­cois Hol­lande defeat­ed her fel­low con­ser­v­a­tive Nico­las Sarkozy and Greek vot­ers pun­ished rul­ing par­ties who slashed spend­ing to secure a for­eign bailout.

    Shunned by Merkel, who pub­licly backed Sarkozy’s cam­paign, Hol­lande repeat­ed­ly crit­i­cised Ger­many’s focus on bud­get cuts and labour law reforms as the solu­tion to Europe’s debt cri­sis. Many saw his vic­to­ry and the out­come in Greece as herald­ing a shift in Europe toward high­er-spend­ing growth-ori­ent­ed poli­cies.

    But close Merkel allies made clear with­in hours that the expec­ta­tion in Berlin was that it would be Hol­lande who would be mak­ing the lion’s share of the con­ces­sions, and row­ing back on pol­i­cy promis­es made dur­ing the French cam­paign which the Ger­mans view as dan­ger­ous for the entire sin­gle-cur­ren­cy bloc.

    “The posi­tion of the Ger­man gov­ern­ment is clear. We will con­tin­ue on our sav­ings path,” said Volk­er Kaud­er, par­lia­men­tary leader of Merkel’s con­ser­v­a­tives and one of her clos­est allies.

    After anoth­er bad night for her Chris­t­ian Democ­rats (CDU) in a state elec­tion on Sun­day, Merkel knows that if she is to win a third term next year she can ill afford to ignore Ger­man vot­ers’ demands that she give no more of their cash away to for­eign­ers.


    Pressed repeat­ed­ly at a news con­fer­ence on whether the French and Greek votes might change the pol­i­cy debate in Europe, Merkel’s spokesman Stef­fen Seib­ert insist­ed the only way for­ward was growth through struc­tur­al reform — such as of tax and labour rules aimed at improv­ing trade — not debt-fund­ed stim­u­lus plans.

    Merkel her­self made clear that, while there was scope to dis­cuss tac­tics, the over­all strat­e­gy EU lead­ers com­mit­ted to by agree­ing a com­pact on fis­cal con­sol­i­da­tion was “not nego­tiable”.

    “We are in the mid­dle of a debate to which France, of course, under its new pres­i­dent will bring its own empha­sis,” she said. “But we are talk­ing about two sides of the same coin — progress is only achiev­able via sol­id finances plus growth.”


    Ger­many has already sig­naled it is ready to nego­ti­ate a “growth pact” with the new French leader. Though its terms may well be vague, that would allow Hol­lande to claim vic­to­ry in his push for a more bal­anced approach to the cri­sis.

    But bold new ini­tia­tives that might give ail­ing economies like Greece and Spain a sub­stan­tial boost are unlike­ly.

    “Boost­ing growth is fine, but the ques­tion is how,” CDU bud­get expert Nor­bert Barth­le told Reuters. “Our focus remains firm­ly on struc­tur­al reforms.”



    On Greece, offi­cials in Berlin and Brus­sels are also tak­ing a hard line, mak­ing clear they see no room for the coun­try to renege on or rene­go­ti­ate the terms set out in its mul­ti-bil­lion euro res­cues by the bloc and the IMF.

    The fail­ure of the big par­ties that have dom­i­nat­ed Greek pol­i­tics for decades to secure a major­i­ty, and a surge in sup­port for extreme par­ties from the left and right, has raised ques­tions about whether Athens will stick to its com­mit­ments and sparked spec­u­la­tion it could be forced out of the euro zone.

    “Either they stick to the pro­gramme and receive the financ­ing from mem­ber states — or they will have to default,” said a senior euro zone source before the pro-EU Greek Social­ist par­ty leader called explic­it­ly for a rene­go­ti­at­ed bailout deal.

    “What the default would lead to, I don’t know,” the source said. “But cer­tain­ly to even more hard­ship for Greek cit­i­zens.”


    Posted by Pterrafractyl | May 7, 2012, 7:56 am
  25. It appears there’s been a major set­back for Merkel and co.

    Fran­cois Hol­lande just won the elec­tion in France.

    Greece is still up in the air but hope­ful­ly the left­ists can get their act togeth­er and pull off a vic­to­ry. Because if the con­ser­v­a­tives remain in pow­er, espe­cial­ly if Gold­en Dawn decides to ally with them(not at all implau­si­ble and it could just hap­pen!), they will be in DEEP trou­ble.

    Posted by Steven L. | May 7, 2012, 1:05 pm

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