Archive for the ‘Budget’ Category

Venezuela Runs Out of Money to Print Money

Thursday, April 28th, 2016

The Magic Power of Socialism™ has finally dragged Venezuela far enough down the slope that the economy is going to hell at an ever accelerating rate.

First and foremost, the country is so boned that they can’t even afford to print money anymore.

In a tale that highlights the chaos of unbridled inflation, Venezuela is scrambling to print new bills fast enough to keep up with the torrid pace of price increases. Most of the cash, like nearly everything else in the oil-exporting country, is imported. And with hard currency reserves sinking to critically low levels, the central bank is doling out payments so slowly to foreign providers that they are foregoing further business.

Venezuela, in other words, is now so broke that it may not have enough money to pay for its money.

Snip.

Last month, De La Rue, the world’s largest currency maker, sent a letter to the central bank complaining that it was owed $71 million and would inform its shareholders if the money were not forthcoming. The letter was leaked to a Venezuelan news website and confirmed by Bloomberg News.

“It’s an unprecedented case in history that a country with such high inflation cannot get new bills,” said Jose Guerra, an opposition law maker and former director of economic research at the central bank. Late last year, the central bank ordered more than 10 billion bank notes, surpassing the 7.6 billion the U.S. Federal Reserve requested this year for an economy many times the size of Venezuela’s.

When you run out of money to print money, perhaps you should take that as a sign the express train to you socialist paradise has permanently derailed.

As part of its ongoing economic collapse, Venezuela’s government is now going from a four-day workweek to a two day workweek. Given the bang-up job the socialists have done running the economy, I suspect that will hurt less than the shortages of food and toilet paper.

No wonder the people are flocking to sign a recall petition to oust socialist President Nicolas Maduro. But that’s not an easy road either:

His adversaries first need to collect nearly 200,000 signatures, representing 1% of the nation’s more than 19 million voters. The National Electoral Council, which is closely allied with the government, has 20 days to authenticate them. If that drive is successful, the opposition must then collect nearly four million signatures over three days before the end of the year to trigger an actual recall vote. To win that new election, they would have to garner more votes than the 7.5 million Mr. Maduro got in the 2013 election.

Typically this is the point (or long past it) where a third world nation’s military would declare “enough!” and depose El Presidente themselves. So far neither armed forces leader Vladimir Padrino Lopez nor National Guard leader Nestor Reverol have shown any signs of doing so…

(Hat tip: Ace of Spades HQ.)

“Greece, EU/IMF lenders resume talks over bailout reforms”

Monday, April 25th, 2016

That’s an actual headline today. I throw in “today” because that same headline could have been run just about any time over the past five years, because Greece is endlessly willing to talk as long as they keep getting bailout money.

The one thing they have proven absolutely unwilling to do is actually implement reforms, at least any reforms that would involve the government spending less money than it takes in. Instead they’ll ask for more debt write-downs, write-offs and haircuts for lenders rather than stop spending other people’s money.

And I could have written the preceding paragraph any time over the last five years or so as well…

Texas vs. California Update for April 18, 2016

Monday, April 18th, 2016

Time for another Texas vs. California roundup, with the top news being California’s hastening their economic demise with a suicidal minimum wage hike:

  • Jerry Brown admits the minimum wage hike doesn’t make economic sense, then signs it anyway. (Hat tip: Ed Driscoll at Instapundit.)
  • Who is really behind the minimum wage hike? The SEIU:

    California’s drive to hike the minimum wage has little to do with average workers and everything to do with the Golden State’s all-powerful government employee unions.

    Nationally, the Service Employees International Union (SEIU) is known for representing lower skilled workers. But, of the SEIU’s 2.1 million dues-paying members, half work for the government. In California, that translates to clout with much of the $50 million SEIU spent in the U.S. on political activities and lobbying spent in California. In fact, out of the 12 “yes” votes for the minimum wage bill in the Assembly Committee on Appropriations on March 30, the SEIU had contributed almost $100,000 out of the three-quarters of a million contributed by public employee unions—yielding a far higher return on investment than anything Wall Street could produce.

    Unions represent about 59 percent of all government workers in California. Many union contracts are tied to the minimum wage — boost the minimum wage and government union workers reap a huge windfall, courtesy of the overworked California taxpayer.

  • “The impacts of the increase in minimum wage on workers at the very bottom of the pay scales might be just the tip of the iceberg in terms of the ramifications of the minimum wage increase.” (Hat tip: Pension Tsunami.)
  • Indeed, that hike will push government employee wages up all up the ladder.
  • “California minimum wage hike hits L.A. apparel industry: ‘The exodus has begun.'” (Hat tip: Director Blue.)
  • “Texas’ job creation has helped keep the unemployment rate low at 4.3 percent, which has now been at or below the U.S. average rate for a remarkable 111 straight months.”
  • “Number of Californians Moving to Texas Hits Highest Level in Nearly a Decade”:

    “California’s taxes and regulations are crushing businesses, and there are more opportunities in Texas for people to start new companies, get good jobs, and create better lives for their families,” said Nathan Nascimento, the director of state initiatives at Freedom Partners. “When tax and regulatory climates are bad, people will move to better economic environments—this phenomenon isn’t a mystery, it’s how marketplaces work. Not only should other state governments take note of this, but so should the federal government.”

    According to Tom Gray of the Manhattan Institute, people may be leaving California for the employment opportunities, tax breaks, or less crowded living arrangements that other states offer.

    “States with low unemployment rates, such as Texas, are drawing people from California, whose rate is above the national average,” Gray wrote. “Taxation also appears to be a factor, especially as it contributes to the business climate and, in turn, jobs.”

    “Most of the destination states favored by Californians have lower taxes,” Gray wrote. “States that have gained the most at California’s expense are rated as having better business climates. The data suggest that may cost drivers—taxes, regulations, the high price of housing and commercial real estate, costly electricity, union power, and high labor costs—are prompting businesses to locate outside California, thus helping to drive the exodus.”

    (Hat tip: Pension Tsunami.)

  • More on the same theme. (Hat tip: Pension Tsunami.)
  • It’s not just pensions: “The state paid $458 million in 2001 (0.6 percent of the general fund) for state worker retiree health care and is expected to pay $2 billion (1.7 percent of the general fund) next fiscal year — up 80 percent in just the last decade.” (Hat tip: Pension Tsunami.)
  • Texas border control succeeds where the Obama Administration fails. (Hat tip: Ace of Spades HQ.)
  • California and New York still lead Texas in billionaires. But for how long?
  • “The housing bubble may have collapsed, but the public-employee pension fund managers are still with us. If anything they’re bigger than ever, still insatiably seeking high returns just over the horizon line of another economic bubble.” (Hat tip: Pension Tsunami.)
  • How to fix San Francisco’s dysfunctional housing market. “Failed public policy and political leadership has resulted in a massive imbalance between how much the city’s population has grown this century versus how much housing has been built. The last thirteen years worth of new housing units built is approximately equal to the population growth of the last two years.” Also: “The city is forcing people out. Only the rich can live here because of the policies created by so-called progressives and so-called housing advocates.” (Hat tip: Ed Driscoll at Instapundit.)
  • UC Berkley to cut 500 jobs over two years.
  • What does BART do faced with a $400 million projected deficit over the next decade? Dig deeper. (Hat tip: Pension Tsunami.)
  • Stanton, California, is the latest California municipality facing bankruptcy. “One of the main reasons the city can’t pay its bills without the sales tax is that it gives outlandish salaries and benefits to its government workers.” (Hat tip: Pension Tsunami.)
  • Yesterday was Tax Freedom Day in Texas.
  • Politically correct investing has already cost CalPERS $3 billion. (Hat tip: Pension Tsunami.)
  • “A federal jury on Wednesday convicted former Los Angeles County Undersheriff Paul Tanaka of deliberately impeding an FBI investigation, capping a jail abuse and obstruction scandal that reached to the top echelons of the Sheriff’s Department.” (Hat tip: Dwight.)
  • Top California Democratic assemblyman Roger Hernandez accused of domestic violence.
  • Calls for UC Davis Chancellor Linda P.B. Katehi to resign, she of the supergenius “pay $175,000 to scrub the Internet of negative postings about the pepper-spraying of students in 2011” plan.
  • California beachwear retailer Pacific Sunwear files for Chapter 11 bankruptcy.
  • California retailer Sport Chalet is also shutting down.
  • 75% of current Toyota employees are willing to move to Texas to work at Toyota’s new U.S. headquarters.
  • California isn’t the only place delusional politicians are pushing a “railroad to nowhere.” The Lone Star Rail District wants to keep getting and spending money despite the fact that Union Pacific said they couldn’t use their freight lines for a commuter train between Austin and San Antonio. The tiny little problem being that the Union Pacific line was the only one under consideration…
  • Texas vs. California Update for February 25, 2016

    Thursday, February 25th, 2016

    Been too long since I did a Texas vs. California roundup, so here it is:

  • Dark Age California:

    There are large areas of Central California that resemble life in rural Mexico. Within a radius of five miles I can go to stores and restaurants where English is rarely spoken and there is no racial or cultural diversity—a far cry from Jeb Bush’s notion of an “act of love” landscape.

    With unemployment at 10% or more in the interior of the state, with the public schools near the bottom in the nation, and with generous entitlements, it is no accident that one in six in the nation who receive public assistance now live in California, where about a fifth of the population lives below the poverty line.

    One in four Californians also were not born in the United States; more than one in four who enter the hospital for any cause are found upon admittance to suffer from Type II diabetes. The unspoken responsibility of California state government is to bring state-sponsored parity to new arrivals from Oaxaca, and to do so in ideological fashion that ensures open borders and more government. It is the work of a sort of secular church, and questioning its premises is career-ending blasphemy.

  • “California has come a long way to dig itself out of budget deficits, but the state remains on shaky ground due to nearly $400 billion in unfunded liabilities and debt from public pensions, retiree health care and bonds.” More: “It’s California’s debt and liabilities that are concerning financial analysts, particularly the state’s rapidly growing unfunded retiree health care costs, which grew more than 80 percent over the past decade. California has promised $74 billion more in health and dental benefits to current and retired state workers than the state has put aside.” (Hat tip: CalWatchdog.)
  • And new accounting rules make those unfunded liabilities harder to ignore.
  • The problem might not be quite as bad as it is did not CalPERS and CalSTARS insist on politically correct investments. (Hat tip: Pension Tsunami.)
  • San Francisco political officials indicted:

    A retired city employee and a former city commissioner who are at the center of bribery allegations involving Mayor Ed Lee were charged with multiple felonies including bribery and money laundering, San Francisco District Attorney George Gascon announced at a news conference Friday afternoon.

    Also charged Friday was political consultant and former San Francisco Unified School District Board of Education President Keith Jackson, who pleaded guilty last year to racketeering charges.

    The district attorney’s office charged recently retired Human Rights Commission employee Zula Jones, ex-HRC commissioner Nazly Mohajer and former political consultant Keith Jackson.

    Remember that Zula Jones and Nazly Mohajer were fingered by Leeland Yee’s attorneys as being the go-betweens for bribing Lee. This brings up the question (yet again): Why hasn’t Lee himself been indicted?

  • And speaking of California government officials being indicted: “Retired Los Angeles County Sheriff Lee Baca pleaded guilty Wednesday to lying to federal investigators, a stunning reversal for the longtime law enforcement leader who for years insisted he played no role in the misconduct that tarnished his agency.” (Hat tip: Dwight.)
  • Jerry Brown vetoes kangaroo court minimums for college sexual assault cases.
  • “Brown pushed for the giant pension fund CalPERS to lower its assumed investment return from 7.5% to 6.5%. Given that the world is headed towards deflation and that CalPERS earned only 2.4% for the fiscal year ended June 30, 2015, Brown’s request seemed entirely reasonable. Instead, the board approved a staff proposal to move to the 6.5% target over 10 years.” (Hat tip: Pension Tsunami.)
  • CalPERS board President Rob Feckner, serving his twelfth term, casts deciding vote against proposal for term limits for board members. “Feckner was president of the California School Employees Association for four years and executive vice president of the California Labor Federation for five. Such a conflict of interest wouldn’t be tolerated with the president of other boards of directors. But with CalPERS, it’s par for the course.” (Hat tip: Pension Tsunami.)
  • San Diego voters: We want pension reform! Union-stacked Public Employment Relations Board (PERB): Get stuffed, peasants! Result: Lawsuit. (Hat tip: Pension Tsunami.)
  • The middle class is fleeing California. “In 2006, 38 percent of middle-class households in California used more than 30 percent of their income to cover rent. Today, that figure is over 53 percent.”
  • California tech industries continue their exodus to Texas:

    The tech industry in the Bay Area has become a victim of its own success – and state policies. Like many other California businesses, tech firms are relocating or expanding operations in others states – particularly Texas – at an alarming rate.

    Some companies spend significant amounts of time and money finding and training the right workers, only to see them poached by a flashy startup within a number of months. The need for a more stable workforce was one of the main reasons cloud-computing company LiveOps Cloud moved from Silicon Valley to a suburb of Austin, Texas, CEO Vasili Triant told the San Francisco Chronicle.

    Other reasons to move or expand out-of-state are government-created: high taxes, burdensome regulations, unaffordable housing due to excessive development fees and restrictive land-use policies. California’s highly-educated workforce is not so unique anymore, and its quality of life has been tarnished by regulatory and affordability issues. Texas, by contrast, has no personal income tax and no corporate income tax (though it does have a less-onerous gross margins tax), and is universally hailed for having one of the friendliest business climates in the nation.

    Google, Facebook, Apple, Dropbox, Oracle and nearly two dozen other Bay Area tech companies have all built or expanded facilities in Texas just since 2014, the Chronicle reported. There have been more than 1,500 publicly reported California “disinvestment events” across all industries over the past seven years, according to a November report from Spectrum Location Solutions, an Irvine-based business relocation consulting firm, although it estimated the actual tally at as high as 9,000. A California business “can save 20 percent to 32 percent of labor costs by relocating a facility out of state,” Spectrum president Joe Vranich told us last year.

  • More on the theme:

    Between 1997 and 2000, during the peak of the dot-com boom, the Bay Area was a net importer of Texans: About 1,500 more households moved into the region from Texas than vice versa, bringing an additional $191 million (2015 dollars) in taxable income into the region, according to IRS data, which tracks the movement of taxpaying residents.

    The trend changed in the early 2000s, and Texas has been a net importer of Bay Area households ever since. Between 2009 and 2012, as the recession was winding down and the second tech boom was revving up, the region lost about 1,430 households to Texas, and nearly $390 million in taxable income.

    Snip.

    I had a guy working for me (in the Bay Area) making $200,000 a year, struggling to pay his bills,” company CEO Triant said. “In lots of places in the country you’re living high on the hog on $200,000. … As far as work life balance and employee morale, we have absolutely seen a remarkable increase since moving here; it’s night and day.”

    The firm still keeps a small Bay Area office, and Triant speaks fondly of his hometown of San Diego and California in general.

    But when it comes to building a company and running a business, he has found a new home in Texas. “I want my employees to be able to have a good quality of life, live in a city with low crime rates, good schools,” he said. “And that’s what we’re doing here.”

  • “It’s no coincidence that Texas and Florida have thrived while New York and California have not. High levels of taxes, spending, and regulations make it more difficult for entrepreneurs to be successful. When entrepreneurs cannot expand their businesses and hire new workers, everyone is hurt, not just the rich.”
  • In the course of verifying a Rep. Joe Straus campaign ad, Polifact confirms that Texas has grown twice as fast as the rest of the country.
  • The University of California, Berkeley, is running a $150 million deficit this year. (Hat tip: Pension Tsunami.)
  • UC Academic Senate rejects task force’s proposed retirement benefits plan that, keeping with Jerry Brown’s modest pension reforms, would pay them a measly $117,020 pension benefit. (Hat tip: Pension Tsunami.)
  • “What’s more important: High-speed rail or water? Proponents of a proposed ballot measure would force voters to choose just that. The measure would redirect $8 billion in unsold high-speed rail bonds and $2.7 billion from the 2014 water bond to fund new water storage projects.”
  • Speaking of water restrictions, looks like Californians will get to enjoy them for another year.
  • Sure, Covered California (California’s ObamaCare) may be incompetent. But it’s also corrupt. The state auditor “criticized the exchange for not sufficiently justifying its decision to award a number of large contracts without subjecting the contractors to competitive bidding.”
  • California is releasing many felons as part of a “mass forgiveness” program. Including a murderer who tied up a husband and wife and beat them to death with a pipe.
  • California adds Aloe Vera to list of cancer-causing substances. “The problem is that the 800+ chemicals listed in Proposition 65 are not devised to protect consumers, but rather serve as a cash cow for private trial lawyers to sue small business and reap the hefty settlement payout. Since 1986, nearly 20,000 lawsuits have been filed, adding up to over half a billion dollars in settlement payments by business owners.” (Hat tip: Ed Driscoll at Instapundit.)
  • San Francisco’s planning process is designed for gridlock.
  • Bankrupt San Bernardino has reached a settlement with its firefighters union.
  • Heh. “The movement to emblazon state legislators with the logos of their donors has collected tens of thousands of signatures for its would-be ballot initiative.The measure, formally called the ‘Name All Sponsors California Accountability Reform (or NASCAR. Get it?) Initiative,’ would require all state legislators to wear the emblems or names of their 10 top donors every time they attend an official function.” The ballot initiative has already collected 40,000 signatures…
  • Huge soda pop collection is coming to the Dr Pepper museum in Waco.
  • Texas vs. California Update for November 2, 2014

    Monday, November 2nd, 2015

    California continues to suffer from drought while central Texas just suffered through torrential rains. Time for another Texas vs. California update:

  • Texas Adds 26,600 Jobs in September.
  • Texas and Florida rank at the top of education index for biggest states, while California ranks last.
  • The University of Texas is ranked the number one public university in America.
  • Meanwhile, at the University of California system: “The number of those making at least $500,000 annually grew by 14 percent in the last year, to 445, and the system’s administrative ranks have swelled by 60 percent over the last decade – far outpacing tenure-track faculty.” (Hat tip: Pension Tsunami.)
  • Another example of California’s perpetual trial lawyer enrichment act: “cumulative trauma” awards for employees after termination, even if they’ve never reported symptoms before. Shouldn’t every former member of the Raiders, Chargers and 49ers file a lawsuit?
  • Why CalPERS contributions are soaring. (Hat tip: Pension Tsunami.)
  • So now the California high speed rail boondoggle is going to cost $68 billion and require 36 miles of tunnels, including some dug right through an active tectonic fault. That’s ten times the length of tunnel Boston needed to dig for the Big Dig. And the cost is equivalent to the Gross Domestic Product of Sri Lanka. For a train line. It would probably be cheaper to buy cab rides for everyone traveling between Los Angeles and San Francisco, but that wouldn’t provide enough opportunities for graft…
  • “The parent company of the Orange County Register and Riverside Press-Enterprise filed for federal bankruptcy protection.”
  • Also filing for bankruptcy, yet another West coast grocery chain, Fresh & Easy.
  • Another bankruptcy filing: Fresno’s One Club Casino. California casinos are different from Nevada casinos, and I believe One Club is what is called a “card room”. Still, when you can’t make a profit off gambling…
  • California plastics company opens plant in Pflugerville. “Medway, founded in 1974, will also relocate its research and development laboratory to the new Pflugerville facility. Though Medway Plastics will continue operations in California, the company may consider relocating its headquarters to Pflugerville within the next five to eight years, the company said.”
  • Plans continue apace to build a Texas Gold Depository.
  • California Ballot initiatives weaponize emotion to centralize power.
  • TPPF: Why the Texas Model Supports Prosperity

    Wednesday, October 21st, 2015

    I could roll this up into the next California vs. Texas update, but I thought this Texas Public Policy Foundation paper by Vance Ginn on why Texas’ low tax, low regulation model generates prosperity was meaty enough to be worth a separate post.

    The Texas model has been touted as an approach to governance that other states and Washington, D.C. would be wise to follow. This approach promotes individual freedom through lower taxes and spending, less regulation, fewer frivolous lawsuits, and reduced federal government interference. Does this Texas restatement of the unalienable rights of “Life, Liberty and the pursuit of Happiness” actually promote freedom, prosperity, and jobs when compared to the largest states and U.S. averages?

    To answer this question, this paper (in most cases) compares various measures in California, Texas, New York, and Florida—the states with the largest populations and economic output—and U.S. averages during the last 15 years. Five fiscal measures of economic freedom and government intervention for these states show that Texas generally leads the pack as the most free with the least government intrusion. Eight measures of the labor market indicate that Texas provides the best opportunities to find a job. Five measures of income distribution and poverty show that Texas leads in most categories with a more equal income distribution and less poverty despite fewer redistributionary policies than these large states, particularly California and New York.

    Though a mere 15 pages, the paper offers up an in-depth survey of various economic metrics and studies, where Texas repeatedly comes out on top, and New York and California repeatedly come in last and second-to-last.

    A few more tidbits:

  • In a “Soft Tyranny Index” (measuring state government bureaucracy, state spending, income tax, and tax burden) “Texas ranks first with the least government intrusion, Florida 17th, California 49th, and New York 50th.”
  • “Texas outpaces the rest of the U.S. in nonfarm job creation since December 2007.”
  • “Texas’ distribution of income is more equal compared with other large states.”
  • Read the whole thing.

    Illinois Too Broke to Pay Lottery Winners

    Thursday, October 15th, 2015

    I may spend a lot of time covering California, but don’t forget that Illinois is broke as well, and will temporarily stop making pension payments. This has come about because Democrats in the state legislature refuse to implement new Republican Governor’s Bruce Rauner demanded (and long-overdue) reforms, preferring to continue their merry corrupt tax-and-spend ways.

    Keep in mind that Illinois already has a $105 billion unfunded pension liability.

    Illinois, of course, is still controlled by the combine, which is to say big-spending Democrats firmly committed to an expansive welfare state and Republicans determined to go along with it in the name of staying in office.

    Now comes word that they’re not even paying lottery winners more than $600.

    Without reform, Illinois will inch closer to the inevitable welfare state endgame we’ve seen in Greece: Too many people sucking at the government teat, not enough taxpayers to support them, and a free-spending political class unwilling to implement real reform because it clashes with their liberal political self-interest.

    Texas vs. California: Cali Goes Batshit Insane Edition

    Tuesday, August 25th, 2015

    California has long had a tenuous grasp of what the rest of us regard as consensus reality. But two new pieces of legislation suggest they’ve gone off the deep end into full Victimhood Identity Politics land:

  • First, they decided that police shootings wouldn’t be subject to the grand jury process, because what’s a little things like two centuries of due process and the fifth amendment to the Constitution when there are policemen to be railroaded to satisfy black protesters?
  • They also decided to purge the words “illegal alien” from state statutes, because what’s mere law when there’s political correctness to be pandered to?
  • Of course, that’s not all that’s new on the Texas vs. California front:

  • “California taxpayers paid out big bucks to state workers in 2014. How much? More than the Gross Domestic Product of 100 countries, according to new data published by the State Controller’s office. In 2014, more than 650,000 state employees earned a total of $32 billion in wages and benefits.” It gets better: “Nine hundred sixty-nine state employees earned more than the President of the United States.” Added irony:

    The lowest paid average workers represented agencies focused on the environment, women and people with disabilities. According to the state’s 2014 payroll data, the average salary for the 11 state employees at the California Commission on Disability Access was just $15,213 per year, slightly more than the $14,494 average salary paid to the four employees at the Commission on the Status of Women.

  • There is no California. Only Zuul…
  • Texas unemployment rate: 4.2%. California unemployment rate: 6.2%. (Hat tip: WILLism’s Twitter feed.)
  • Los Angeles’ new minimum wage has wrecked hotel employment. Or maybe just non-illegal alien employment… (Hat tip: Moe Lane.)
  • Why Public Services in California Decline Even As Revenues Rise. “Until California’s leaders address the three elephants – retirement, healthcare and corrections costs — that are crowding out public services and causing unproductive tax and fee increases, citizens will continue to suffer and inequality will continue to grow.” (Hat tip: Pension Tsunami.)
  • Chuck Devore on what makes Texas friendly to business: less red tape and lower taxes.
  • Voters to San Jose City Council: We want pension reform! San Jose City Council to voters: Get stuffed! (Hat tip: Pension Tsunami.)
  • TV’s CHiPS never seemed to be involved in ethics scandals the way the current administration is, including no-bid contracts to European companies. (Bonus: it’s also suitable for Dwight’s Art Acevedo watch.)
  • California’s “Green Jobs Initiative” spent $297 million to create 1,700 jobs.
  • More on the same theme, and Tom Steyer wasting $29.6 million of his own money pushing it, from City Journal.
  • California’s SFX: from billion dollar company to bankruptcy.
  • Greek Update: Tsipras Out, New Party Formed, Snap Elections Coming, Debt Payment Made

    Friday, August 21st, 2015

    “Prime Minister Alexis Tsipras resigned on Thursday, hoping to strengthen his hold on power in snap elections after seven months in office in which he fought Greece’s creditors for a better bailout deal but had to cave in.”

    Turns out promising free ice cream, only to deliver expensive rotted cabbage, wasn’t popular with Greek voters.

    Nor were his actions popular with members of his own party, 25 of whom have broken off to form the new National Unity Party, who will evidently return to the “demand free ice cream and insist others pay for it” strategy Tsipras abandoned in the face of the sinister force know as reality.

    On the plus side, Greece just used it’s new bailout fund to make a debt payment to the European Central Bank for the last batch of money it borrowed to prop up its unsustainable welfare state.

    We’re in that happy honeymoon period after Greece gets more money and before Eurocrats are shocked, shocked that Greece’s economy is still a festering pile of fail that all those and promised economic reforms haven’t actually been implemented.

    Give it another six to nine months…

    Greece: Dispatches from the Boned

    Thursday, August 13th, 2015

    So I haven’t done a Greek update in a while, since after Greece caved into the inevitable (Newsflash: broke people generally do not have leverage over those lending them money), it was all over but the shouting. Now that Greece and its creditors supposedly have a third bailout deal inked, and Greece settles into its clearly defined misery, let’s take a look at exceptionally bankrupt Greece these days, shall we?

  • Via Zero Hedge comes former Greek finance minister Yanis Varoufakis’ detailed review of the bailout agreement. It’s a mixture of self-serving lies (trying to distance his own Syriza party from the horrific economic mess they made acutely worse) and brutal truths (about just how screwed Greece is by the agreement).
  • Speaking of Varoufakis, it looks like he’s going to be up on hacking charges…for preparing emergency plans to float the drachma.
  • Oh: He also says the latest bailout deal won’t work. He’s not wrong…
  • Greece’s economy miraculously grew in the second quarter. But that was before the full effects of the crisis were reflected…
  • Greece’s tax revenues have collapsed.
  • Greece’s manufacturing sector fell off a cliff in July. Funny how that happens when your banks are closed and you can’t pay for goods.
  • Greece faces two years of recession. That part’s probably true. But that primary budget surplus? Yeah, not so much.
  • “Greece’s banks just made the mistake of being banks in Greece.”
  • After all that? Greece still isn’t fixed.
  • To add a cherry on top, Greece’s refugee crisis continues to grow. Because it’s still safer to live in bankrupt Greece than the Middle East…