So the latest “final” bailout is agreed upon, the Greek parliament passes the austerity measured decreed by their German overlords like good little members of the Eurocratic elite, and for their troubles Greek citizens (whose input on the issue is neither required nor desired) responded to these events with widespread arson and looting.
Here are some protesters expressing their displeasure with austerity measures via the now-traditional medium of Molotov cocktails:
Who are we supposed to root for, the Eurocrats who turned a blind eye to Greece’s spendthrift ways when they let them join the Euro, the Greek bureaucrats who went on an orgy of unsustainable welfare state spending with Germany’s credit card, or the Greek citizens who happily sucked at the welfare state teat as long as Uncle Helmut was paying for it and are now throwing a hissy fit because mean Aunt Angela wants to ween them away? It’s like trying to decide between the pusher who stops giving away free heroin after ten years, or the junkie suddenly denied their fix: There are no heroes or sympathetic actors. Keep giving me my heroin or the Acropolis burns!
Other burning Euro issues:
And those members of the Greek parliament who voted against the deal? 43 members of the socialist and conservative parties were were immediately expelled from their parties. That will teach them not to heed their master’s voice…
Those austerity measures are absolutely set in stone…except that they’re not. “Antonis Samaras, leader of New Democracy and likely the next prime minister, said the measures should be renegotiated after national elections expected in April.” What’s mine is mine, what’s yours is negotiable.
Forbes spins scenarios. If Greece leaves the Euro, things get slightly worse. All the PIIGS leaving is a bit more serious. Germany leaving the Euro? It makes the the housing bubble aftermath look like a clear blue sky of deepest summer by comparison…
As long as Germany wasn’t complaining, others could make free with Germany’s credit card. Once in the euro, Greece, Italy, Spain, and other countries that bankers used to consider reckless or unstable could borrow at the same rates. (The treaties that bound all these dissimilar countries together stipulated that there would be no bailouts for those who borrowed too much, but bankers obviously didn’t believe that.) A boom in lending pushed up wages and prices in those “peripheral” countries, rendering them uncompetitive. After the financial crisis of 2008, the countries that had overborrowed were saddled with more debt than they could comfortably repay. The eurozone’s Mediterranean members have come to think that Germany ought to rescue them. But the Germany to which they are addressing their petitions is not the penitent, diffident, and easily browbeaten land that they came to know over the last three generations. Germany has its own ideas about economics and morality, and it is ready to insist that its weaker neighbors adhere to them.
(snip)
The German public was dragged into the euro reluctantly and would never have consented to it had they been consulted. “The euro has always been the ‘Golden Calf,’ so to speak,” says Barclays’s economist Thorsten Polleit. “It was forced upon Germans.” There is still a lot of debate about how it was forced upon Germans. The most common explanation is that French president François Mitterrand insisted on the euro as a condition of Germany’s reunification. A number of Germany’s top politicians and economists assured citizens that the new currency would hold prices stable. That turned out to be right. They also promised that this would not mean sharing wealth and bailing out laggards. That turned out to be wrong—and perhaps catastrophically, apocalyptically wrong. In the late nineties, “many chief economists did a lot of client presentations where they told people the euro would be as stable as the German mark,” says Jörg Krämer, chief economist at Commerzbank. “I am quite happy I was young enough not to have had to do this.”
How the latest deal could trigger a crisis “rivaling anything yet seen.”. Also: You know which bank isn’t taking any haircut at all he latest debt deal? The European Central Bank.
I’ve been meaning to update the blog roll for a while, so now’s as good a time as any.
Today’s addition is An American Housewife, Formerly in London. She spent five years in London, then moved back to Houston, and blogs about a variety of issues, both personal and political, from the expat (and repat) life and mothering to the latest Obama idiocy.
Anyway, she’s been linking and dropping into BattleSwarm with useful comments for a while now, so I’m happy to return the favor. Do drop by when you get a chance.
Greece and the EU are having their final showdown (I tell you final! This time we mean it! Lather, rinse, repeat!) over the Greek debt crises. Until they do it all over again two months from now.
Some people wonder just what all this has to do with the U.S. economy? Well, the one good thing about having a crack house at the end of the street: No one worries about how crappy your own house looks, because it’s great by comparison. But once the PIIGS start defaulting, getting kicked out of the EuroZone, or both, people are going to start to notice that Obama hasn’t mowed the lawn in months…
Metaphors! I mix them! Now back to all that exciting Euro-defaulting action:
Europe tells Greece take the deal or else. Of course, as Bob Dylan once noted: “When you got nothin, you got nothin to lose.” At this point, who does throwing Greece out of the EuroZone hurt worse: Greece, or Europe? Alternate metaphor: Maybe you should have cut off that gangrenous toe before it spread to your thigh…
And what’s this unacceptable demand Europe is making? To cut deficit spending by…1.5% of GDP. For a country running a deficit of, what, 9% of GDP? “Son, you’ve got to promise you’ll cut down on shooting smack by one-sixth.” Hey Greece (and, for that matter, Europe. And Obama): How about you (and try to keep up with me here) stop all deficit spending? That would take care of the problem, no?
The real reason Germany is asking for total control of Greek finance in exchange for the next bailout? To make Greece say no so they don’t have to bail out the rest of the PIIGS: “How do you preclude Portugal, Ireland and, indeed, Spain from asking for the same deal as Greece, if the negotiations succeed? Answer; you can’t. So the Germans throw a politically impossible demand in front of the Greeks, in effect saying, “No more money unless you effectively surrender your national sovereignty.” And that’s the implied warning ahead for the other periphery countries which look to secure the deal currently on the table for Greece. In effect, the Germans (behind the auspices of the troika) are saying, “It’s fiscal austerity on our terms. You try to renegotiate like the Greeks and we take you over. The other alternative is that you leave.”
This article goes into detail about how exactly they lied.
The leader of the Greek Coalition of the Radical Left says the EU won’t dare kick Greece out. And he also wants a three-year suspension of all payments by Greece to foreign creditors. He may be on to something. When you owe the bank $3,000, you have a problem. When you owe the bank $30 billion, the bank has a problem. The OJ Simpson/Clevon Little technique of holding a gun to your own head just might work. “Do what he says! He’s crazy!”
Spain’s fourth largest airline collapses. “The airline was seen as a flagship of the regional government of Catalonia, which had helped it stay afloat with more than 150m euros of subsidies. The government refused to provide more funding on Friday.”
If President Hamlet was thinking about helping topple Assad, now would be a Real Good Time to jump off the fence.
Plus, unlike Libya and Egypt, not only would it be very hard for the next government to be worse than the current one. Plus it would be a blow to Iran and Hezbollah, and thus would dramatically improve the possibility of real peace and a stable government in Lebanon.
You know the problem with doing one of these roundups on the European Debt Crises? I can search for “Euro” just about anytime of the day and night on Google News and come up with a dozen things I could potentially include. So just consider this a Whitman’s European Despair Sampler of possible bad news, as there’s a lot more where this came from:
European Finance Minsters on Greece’s latest bond offer: REJECTED.
In exchange for bailing out Greece yet again, Germany wants Greece to cede control over its tax rates and budget to an EU commission (i.e., Germany). It’s almost touching, this German naivety that Greeks can actually be compelled to obey German laws when they can’t even be compelled to obey Greek laws even now. But despite the fact that such government dictates would be ignored just like they are now, Greeks are still furious at the proposal. (Hat tip: Ace.)
And if Berlin doesn’t get to call the tune? “Germany and the Netherlands are likely to quit the eurozone rather than swallow an indefinite number of ‘unrequited transfers’ to the union’s crisis-stricken nations.”
What will European currency look like after a Euro-zone breakup? Like this.
Another month, another EuroZone bailout fund. The rules for the New and Improved Euro Bailout Fund is: 1. “Access [will] be made conditional on signing a new treaty on fiscal discipline.” 2. “Countries representing 85 percent of the fund’s capital [will make] decisions instead of unanimity among the eurozone 17 – will only apply to authorise ESM loans from existing funds.” So 1.) We get an entire new set of fiscal discipline guidelines for the PIIGs governments to ignore, and 2. Germany will call the tune, and the rest of the Eurozone will dance. At least until the next shuffling of the fiscal deck chairs.
Well, here’s a headline sure to fill investors with confidence: “From now on, in Europe, everything gets worse.”
Spanish unemployment hits 23.4%. And what happens when austerity means they can no longer pay people not to work? That’s he problem with cradle-to-grave European welfare state: sooner or later you run out of your grandchildren’s money…
The Soviet Union yesterday: “We pretend to work, and they pretend to pay us.” Greece today: “The old dynamic—with Greece pretending to make structural changes and its lenders pretending to save it from default—has become untenable.”
The whole EU illusion has been predicated on the assumption that Greeks can be made to behave like Germans, and that the EU could manage to forge a new, multi-ethnic, post-national identity in 20 years when Belgium hasn’t been able to do it in almost 200.
Cameron caves. Sadly, this behavior is far more in line with his previous record than his brief stint of standing on principle.
House Republicans are working to rescind the $100 billion IMF bailout fund Nancy Pelosi helped create. They may not succeed, but they might force the Obama Administration to defend backstopping the Euro at a time when the federal budget is still hemorrhaging red ink…
Last week: France’s credit rating makes our latest Euro bailout fund rock solid. This week: oops.
The threat of default is also holding up the merger of two Greek banks, maybe because it’s as yet unclear just how they’ll put European taxpayers on the hook for their losses. Once that’s figured out, I’m sure the merger will fly through…
Those bondholders who can’t stick it to taxpayers are looking at 70% losses for Greek debt.
LinkSwarm, or EuroDoom? LinkSwarm, or EuroDoom? Well, the first link has some of each, but with Davos just starting up, I imagine their will be a nice helping of EuroDoom ready to serve tomorrow, so let’s put up a LinkSwarm today:
Mark Steyn looks at the Costa Concordia sinking and smells a metaphor.
Myth: Newt Gingrich told his first wife he was divorcing her on her hospital deathbed. Fact: They had already agreed to a divorce, Newt was just visiting her, the tumor was benign, and Jackie Battley Gingrich is still alive. But who are you going to believe: Online liberal trolls, or the daughter who was actually in the hospital room at the time?
Jonah Goldberg discusses Newtzilla, but his best barbs are reserved for his opponent: “Romney seems like a creature put on Earth to blend in with the humans and report back what he finds. He clearly likes earthlings, and they in turn find him pleasant enough and surprisingly lifelike.”
Maureen Dowd on on Obama’s cocoon of self-aggrandizing victimization. Like all Dowd’s columns, it focuses on the trivial minutia of the-personal-as-political…and is all the more devastating for it. “The man who came to Washington on a wave of euphoria has had a presidency with all the joy of a root canal…The Obamas, especially Michelle, have radiated the sense that Americans do not appreciate what they sacrifice by living in a gilded cage. They’ve forgotten Rule No. 1 of politics: No one sheds tears for anyone lucky enough to live at the White House. And after four or eight years of public service, you are assured membership in the 1 percent club.”
After 12 months, what has the Arab Spring wrought in Egypt? Cairo Winter: “The reality of the past twelve months, however, has undone whatever high hopes one might have held. Egypt is now headed for radical theocratic, rather than liberal democratic, rule. And a befuddled Obama administration has failed to do anything to stop the coming disaster.” (Hat tip: Michael Totten, who adds: “I know a few Egyptian intellectuals and activists who are authentic liberals, but they’re not remotely a majority. The percentage of Egyptians who genuinely support most or all the tenets of Western-style liberal democracy is in the high single digits at best.”)
Japan suffers its first trade deficit since 1980. Remember all those stories from the 1980s about how Japan was going to take over the world? They were very similar to the ones we were getting about China just a few years ago…
Hat tips: Ace, Insta, The Corner, and the usual suspects.
In covering the American Jewish Committee/World Affairs Council of Houston senate candidate forum on foreign policy I mentioned previously, we have a news story that is demonstrably deficient in several areas:
You get told who wasn’t there (Craig James, Paul Sadler, and Lt. Governor Chupacabra), and even how many of each flavor were there (“six Republicans, three Democrats and one Libertarian”), but the article itself only lists five of those ten. That would be the very first “W” of the “Five Ws and an H,” assuming they still teach that at journalism school. (Maybe they’re replaced it with another class on “Reporting Social Justice.”)
However, because I’m so Old School, I actually went out and got a list of who attended the forum from the AJC: Republicans Ted Cruz, Tom Leppert, Glenn Addison, Lela Pittinger, Charles Holcomb, and Ben Gambini (yes, an actual Ben Gambini sighting!), Democrats Daniel Boone and Jason Gibson, Libertarian Jon Roland, and independent candidate Mike Champion. So it turns out that even the summary of candidate affiliations was wrong.
In an article on a foreign policy forum that runs just shy of 500 words, a grand total of 96 of them actually dealt with the candidate’s foreign policy views, and even those are essentially free of concrete information. Let’s repost those parts in their entirety:
Cruz also said that “President Obama has been the most anti-Israel president this nation has ever seen.”
[snip]
Leppert emphasized his experience as an international businessman familiar with issues of currency and international trade.
[snip]
Cruz and Leppert were the only two candidates who were able to respond with practiced ease to a series of sophisticated questions dealing with world affairs, ranging from Israel’s response to the Iranian nuclear threat to whether the United States should help bail out faltering European economies. Most of the others on the stage seemed unfamiliar with even the most basic foreign-policy issues.
That’s it. That’s the extent of coverage of the candidates’ foreign policy views in a forum dedicated to that very subject. We are no wiser as to what any candidate thinks of our troops levels in Afghanistan, what our relations with Pakistan should be, whether we should help topple the Assad regime in Syria, how to counter an increasingly bold China, or whether we should use military force to prevent the Islamic Republic of Iran from obtaining nuclear weapons. Were those topics covered? We don’t know, as Holley and the Chronicle do not deign to tell us.
Instead of giving the candidates’ actual views, Holley merely gives us his dismissive analysis of eight of the ten candidates, telling us they are “unfamiliar with even the most basic foreign-policy issues” without bothering to provide a single example of this ignorance.
The rest of the piece consists of horse race analysis, noting Dewhurst’s absence, audience attendance figures, and an interview with a random forum attendee. All of which would have been fine in a longer piece.
Joe Holley and/or his editor have missed a chance to actually inform their readers. I have a hard time thinking of a blogger who couldn’t have done a better job.
The race to a Euro-crackup seems to have slowed down to merely a jaunty saunter this week. Maybe once everyone made it to the New Year without a sovereign default, the Eurocrats might have breathed a sigh, confident that there’s still a few miles yet before they went over the falls…
Germany could create a parallel currency—a new D-Mark, pegged at 1.0 to the euro. The German government would guarantee that holders of German government bonds could convert euro securities to new-D-mark instruments on a one-to-one basis up to some designated date, perhaps two years in the future. Private German contracts expressed in euros would switch to new-D-mark claims over the same period. The transition would likely feature a period in which the euro and new D-mark circulate as parallel currencies.
Other countries could follow a path toward reintroduction of their own currencies over a two-year period. For example, Italy could have a new lira at 1.0 to the euro. If all the euro-zone countries followed this course, the vanishing of the euro currency in 2014 would come to resemble the disappearance of the 11 separate European moneys in 2001.
Of course, this would mean that any bonds from the PIIGS with a maturity date more than two years in the future would trade at a heavy discount, but that’s far preferable to the looming Euro crash. But a bigger problem to this proposal actually being implemented is that it reverses the drive to centralize European bureaucracy, and Eurocrats will never stand for that.
“Air time will be filled instead with extended news bulletins and ‘programs that promote traditional virtues and socialist core values.'”
I don’t think you want to do that, sunshine. People like their TV, and they need something to distract them from China’s imploding economy, general unrest, specific unrest among the Muslim population, unequal sex ratios, Communist Party suppression of dissent, and the endemic corruption. You want to give them more circuses, not less. Do they really think that The Happy Socialist Progress Hour is an acceptable substitute for a popular drama or comedy, or can they just not afford circuses anymore?
And if they can no longer afford the circuses, how soon will it be before they can no longer afford the bread?
With his annual year in review. This year’s theme (ever so appropriate for the Obama Administration): “The Festival of Sleaze.” Some highlights:
“The month’s biggest story is a tragedy in Tucson, where a man opens fire on a meet-and-greet being held by U.S. Rep. Gabrielle Giffords. The accused shooter turns out to be a mentally unstable loner with a history of drug use; there is no evidence that his actions had anything to do with uncivil political rhetoric. So naturally the blame for the tragedy is immediately placed on: uncivil political rhetoric.
“In Europe, the economic crisis continues to worsen, especially in Greece, which has been operating under a financial model in which the government spends approximately $150 billion a year while taking in revenue totaling $336.50 from the lone Greek taxpayer, an Athens businessman who plans to retire in April. Greece has been making up the shortfall by charging everything to a MasterCard account that the Greek government applied for — in what some critics consider a questionable financial practice — using the name ‘Germany.'”
“The European economic crisis worsens still further as Moody’s downgrades its credit rating for Spain following the discovery that the Spanish government, having run completely out of money, secretly sold the Pyrenees to China and is now separated from France only by traffic cones.”
“A major crisis is barely avoided when Congress, after frantic negotiations, reaches a last-minute agreement on the federal budget, thereby averting a government shutdown that would have had a devastating effect on the ability of Congress to continue spending insanely more money than it actually has.”
“Things are even worse in Europe, where Moody’s announces that it has officially downgraded Greece’s credit rating from ‘poor’ to ‘rat mucus’ following the discovery that the Acropolis has been repossessed.”
“May: the big story takes place in Abbottabad, Pakistan, where Osama bin Laden, enjoying a quiet evening chilling in his compound with his various wives and children and porn stash, receives an unexpected drop-in visit from a team of Navy SEALs. After due consideration of bin Laden’s legal rights, the SEALs convert him into Purina brand Shark Chow; he is then laid to rest in a solemn ceremony concluding upon impact with the Indian Ocean at a terminal velocity of 125 miles per hour. While Americans celebrate, the prime minister of Pakistan declares that his nation (a) is very upset about the raid and (b) had no earthly idea that the world’s most wanted terrorist had been living in a major Pakistani city in a large high-walled compound with a mailbox that said BIN LADEN.”
“August: Standard & Poor’s makes good on its threat to downgrade the U.S. credit rating, noting that the federal government, in making fiscal decisions, is exhibiting ‘the IQ of a turnip.’ Meanwhile Wall Street becomes increasingly jittery as investors react to Federal Reserve Board Chairman Bernanke’s surprise announcement that his personal retirement portfolio consists entirely of assault rifles.”
“President Obama returns from his Martha’s Vineyard getaway refreshed and ready to tackle the job he was elected by the American people to do: seek reelection. Focusing on unemployment, the president delivers a nationally televised address laying out his plan for creating jobs, which consists of traveling around the nation tirelessly delivering job-creation addresses until it’s time for another presidential getaway.”
“Mitt Romney unexpectedly exhibits a lifelike facial expression but is quickly subdued by his advisers.”
“An International Monetary Fund audit of the 27-nation European Union reveals that 11 of the nations are missing…Meanwhile in Greece, thousands of rioters take to the streets of Athens to protest a tough new government austerity program that would sharply reduce the per diem rioter allowance.”
“Attorney General Eric Holder announces that the FBI has uncovered a plot by Iran to commit acts of terror in the United States, including assassinating the Saudi ambassador, bombing the Israeli Embassy, and—most chillingly—providing funding for traveling productions of ‘Spider-Man: Turn Off the Dark.'”
Not that I need to tell you, but read the whole thing.