“Syrian army defectors attacked an intelligence complex on the edge of Damascus early on Wednesday, in the first reported assault on a major security facility in the eight-month uprising against President Bashar Assad, activists said.”
The start of something bigger? Who knows? But the security apparatus is at the heart of Assad’s regime, and if rebels can destroy that, there’s nothing to save Assad from the long-suppressed fury of the Sunni majority…
Maybe. News that the Arab league has suspended Syria indicates Bashar Assad may be on even shakier ground than previously thought. Getting suspended by the Arab League for oppressing your own people is only a couple of steps above getting kicked out of the Klu Klux Klan for being too racist.
And unlike Libya, even a hardline Islamist government would be a slight improvement on Assad, especially in Lebanon, if only because the Sunnis would break with Iran and cut off funding for the Shia Hezbollah.
But it’s hard to tell. When Syrian generals defected at the end of July, that looked like it might have been the final push, but wasn’t. never underestimate a cornered dictator willing to do anything to stay in power.
Frontline does a report from inside the Syrian uprising.
Will Obama decide to roll out drone strikes in Syria? Maybe, but I wouldn’t count on it, as Obama hasn’t seemed terribly interested in Syria, even by the lax standards of his foreign policy engagement. Also, the geography is more daunting than in Libya; to be effective, they’d have to come in over Lebanon or Israel to hit targets in Damascus, each of which presents (different) political problems.
Stay tuned…
The scheduled referendum on the bailout of Greece as been canceled.
Once again, the glorious dream of European integration is far to important to let details like the consent of the governed interfere…
There have been high level Euro rescue talks going on all weekend. How are they faring? Not well.
Just when the eurozone governments thought it could not get worse for Europe’s single currency, it did.
Shell-shocked EU finance ministers meeting in Brussels on Saturday were already reeling from the worst Franco-German rift for over 20 years and a fractious failure to resolve the problems that have brought Greece, and the euro, close to the brink.
But then a new bombshell hit as a joint report by the EU and the International Monetary Fund (IMF) warned that, without a default, the Greek debt crisis alone could swallow the EuroZone’s entire €440 billion bailout fund – leaving nothing to spare to help the affected banks of Italy, Spain or France.
Of course, the problem with following this story from abroad is how the news of the summit gets distorted like some intercontinental game of telephone, especially when filtered through the dulcet-toned hearing aids of welfare state boosters. Thus this overly enthusiastic piece in left-wing newspaper The Guardian, citing that a deal was near based on unnamed “EU diplomats” becomes this blipvert in the left-wing Daily Beast stating that a deal had been reached, becomes this Fark thread in which clueless liberals crow that no one should ever have doubted the soundness of either the Euro or the glorious European welfare state. And also that ratings agencies are evil.
And yet, as of right now, this “done deal” to rescue the Euro has yet to materialize. How strange!
Somehow, how France (a country running a a $90+ billion dollar budget deficit) and Germany (a country whose ruling party has lost every local election since it started shoveling money down the Greek bailout chute), were to magically comes up with some €1.6 trillion Euros (the difference between the current bailout fund and the super-sized fund required to backstop the Euro following the inevitable Greek default) is nowhere specified. After all, it was hard enough for Chancellor Angela Merkel to get Germany’s contribution to the fund boosted from €123 billion to €211 billion in the first place.
As a result of all this happy, confident talk of how the Euro will never be allowed to falter? Moody’s downgraded Spain’s credit rating. They also threatened to do the same for France, especially if they decided to throw more taxpayer money into the Greek debt maw.
The Good Ship Europe bears its load of bailout guarantees straight for the center of the Greek Debt crisis.
And if you’re the EU, how do you prevent your debt from being downgraded? A.) Stop borrowing so much, B.) Increase your emergency reserves, or C.) Make it illegal for bond rating companies to downgrade your debt?
Yeah, that will work.
How badly awry has the Eruo project gone? The problem with this Hoover Institute piece on is what not to quote from it:
The champions of the European Union once touted it as a “bold new experiment in living” and “the best hope in an insecure age.” But these days “fear is coursing through the corridors of Brussels,” as the B.B.C. reported in September. Such fear is justified, for the nations of Europe are struggling with fiscal problems that challenge the integrity of the whole E.U.-topian ideal. Greece teetering on the brink of default on its debts, E.U. nations squabbling about how to deal with the crisis, debt levels approaching 100 percent of GDP even in economic-powerhouse countries like Germany and France, and European banks exposed to depreciating government bonds are some of the signposts on the road to decline.
A monetary union comprising independent states, each with its own peculiar economic and political interests, histories, cultural norms, laws, and fiscal systems, was bound to end up in the current crisis. All that borrowed money, however, was necessary for funding the lavish social welfare entitlements and employment benefits that once impressed champions of the “European Dream.” Yet, despite the greater fiscal integration created by the E.U., sluggish, over-regulated, over-taxed economies could not generate enough money to pay for such amenities. Now, the president of the European Council, Herman Van Rompuy, admits, “We can’t finance our social model.”
This financial crisis means the government-financed dolce vita lifestyle once brandished as a reproach to work-obsessed America is facing cutbacks and austerity programs immensely unpopular among Europeans otherwise used to amenities like France’s 35-hour work week, or Greece’s two extra months of pay, or England’s generous housing subsidies that cost $34.4 billion a year. No surprise, then, that from Athens’ Syntagma Square to Madrid’s Puerta del Sol, austerity measures attempting to scale back government spending have been met with strikes, demonstrations, boycotts, and protests, some violent, on the part of citizens for whom such government entitlements have become human rights. In fact, such transfers of wealth have been formalized as rights in Articles 34 and 35 of the E.U.’s Charter of Fundamental Human Rights.
The Euro crises will likely lead to another recession in the U.S. That is, if you think we ever came out of the Obama recession in the first place, which we didn’t.
Europe’s private sector shrank for the first time in two years last month.
Again: The question of a Eurozone collapse is not “if,” it is “when.” And how much of the losses European banks can put taxpayers on the hook for.
Moammar Gadhafi, that is, in the Libyan city of Sirte. Although there are conflicting reports that he was only wounded, but this (graphic) video from the Telegraph shows someone who looks: A.) An awful lot like Gadhafi, and B.) An awful lot like dead.
Another (graphic) video from Al Jazerra:
(Hat tip: Michael Totten.)
Also reported dead: Moammar Gadhafi, Muammar el-Qaddafi, Moammar Kadafi, Muammar Gaddafi, Muammar Gadafy, Moammar Gaddafi, and Moammar Khaddafy.
According to the BBC, he was founding hiding in a drainage pipe, much like Saddam Hussein was pulled from his spider hole.
This is good news for Libya, for the United States, and the world. Now if we can just keep Jihadests from taking over in Tripoli, Obama will have an actual foreign policy accomplishment on his resume.
A smattering of news on this and that:
That’s the rather bracing judgment from this Stratfor overview of Greece’s problem. Moreover, they’re saying that about its existence as a nation-state, even absent the European debt crises. Also: “Greece has to be kicked out of the Eurozone if the Eurozone is to survive.” Problem? They don’t have enough “firebreak” funds to do it. “Until the Europeans have 2 trillion Euro in funding stashed away, they can’t kick Greece out of the system.”
I’m not sure I share the pessimism about Greece in the long run. After all, nation-states can exist for an awful long time, despite crappy conditions (see, for example, Haiti). Of course, that assumes that a newly Islamic Turkey doesn’t decide to settle old scores by conquering them outright. (Assuming, of course, that Turkey is still predominately Turkish rather than Kurdish. Claire Berlinski is a little more sanguine about that prospect.)
Honestly, of the two, I think Greece will outlast the Eurozone by a good measure. The question isn’t the whether Eurocrats can prevent the Eurozone from breaking up, but rather how long they can delay the inevitable, how much sovereign debt can they put taxpayers on the hook for, and how much harder will the inevitable market correction be when it comes? It seems to be a race between how much European taxpayer money can be wasted propping up Europe’s bankrupt welfare states vs. how much of American taxpayer money can the Obama administration waste channeling payouts to well-connected Democratic cronies. The Eurocrats may be winning the race to insolvency, if only due to the lack of a European Tea Party.
In other Euro Debt Crises news:
Is there any other place desperate Eurocrats can get money to prop up their falling welfare states? Are they perhaps hoping that Obama will bail them out? After all, what’s a few more trillions in unsupported debt between friends?
Actually, less rumblings than the roar of an approaching train. And since I temporarily seem to be ahead of the latest Ace of Spades Doom roundup, I’m going to try and give you a nice clear view of the coming crash.
“No longer a question of if, but when – that is the tone of discussions over Greece which has dominated the summit of finance ministers in Washington over the weekend.” Former Britain’s former finance minister Alistair Darling agrees, calling default “only a matter of time.”
The talk now is of how to put in a “firewall” to prevent the contagion of an inevitable Greek default from spreading throughout the European banking system.
The Euroskeptics have been completely vindicated:
Very rarely in political history has any faction or movement enjoyed such a complete and crushing victory as the Conservative Eurosceptics. The field is theirs. They were not merely right about the single currency, the greatest economic issue of our age — they were right for the right reasons. They foresaw with lucid, prophetic accuracy exactly how and why the euro would bring with it financial devastation and social collapse.
I think at this point UK residents should be feeling vrey glad indeed that they didn’t abandon the Pound for the Euro.
Bret Stephens talks about the long line of deceit and fraud that lead Europe to the current crises. “What is now happening in Europe isn’t so much a crisis as it is an exposure: a Madoff-type event rather than a Lehman one.”
Mark Steyn, using the ever popular music and political metaphor gambit, compares the breakup of the Eurozone with the breakup of R.E.M. while bringing the usual Steyn goodness: “Attempting to postpone the Club Med welfare junkies’ rendezvous with self-extinction will destabilize internal German politics (which always adds to the gaiety of nations).” And this:
As its own contribution to the end of the world as we know it, the Obama administration has just released a document called “Living Within Our Means and Investing in the Future: The President’s Plan for Economic Growth and Deficit Reduction.” If you’re curious about the first part of the title — “Living Within Our Means” — Veronique de Rugy pointed out at National Review that under this plan debt held by the public will grow from just over $10 trillion to $17.7 trillion by 2021. In other words, the president’s definition of “Living Within Our Means” is to burn through the equivalent of the entire German, French, and British economies in new debt between now and the end of the decade. You can try this yourself next time your bank manager politely suggests you should try “living within your means”: Tell him you’ve got an ingenious plan to get your spending under control by near doubling your present debt in the course of a mere decade. He’s sure to be impressed.
Germany is near the limit of their willingness to bail out Greece.
There may even be a taxpayer revolt brewing in the Aegean.
And if the other PIIGS are doing better than Greece, it is only a matter of degrees: “Italy is the new Lebanon, Portugal the new Venezuela, Spain the new Vietnam, Ireland the new Argentina and nothing is more risky than Greece, according to today’s credit default swap market.”
But it’s not just Greece and Europe that are hitting the wall. China’s housing bubble may finally be bursting. Worse still: “growth in China may be zero [and] China has ‘European kind of numbers’ when it comes to debt.”
And the Chinese housing bubble isn’t just affecting China. It’s also affecting Canada.
And at least one observer has drawn parallels to a certain hopemonger currently residing in the White House:
Obama has no intention of really solving the debt crisis. And that brings us back to Greece. That government has been doing the same thing for a decade and the chickens have now come home to roost. Greece’s debt is 150 percent of its Gross Domestic Product. Our debt has just reached 100 percent of GDP and the debt is accumulating faster than it ever has. If we were looking out the windshield down the road, we could see the crash that’s just up around the bend.
But rather than put on the brakes, the president has chosen to pick a fight with the other passengers in the car he is driving. Talk about distracted driving! He is gambling that this fight will convince the passengers to let him stay behind the wheel for another four years. But we certainly can’t wait that long. He’s turned up the radio in hopes we won’t hear the ambulance sirens.
It looks like its going to be another rough week for world markets…
A few links for Saturday:
According to Seeking Alpha last week: “Yields on two-year Greek government bonds reached 46.84% recently. This is roughly comparable to yields on Argentine bonds in early December 2001 – only a month before the country defaulted on its debt.”
Other signs of the Euro crisis: The Euro hit a six month low against the dollar, and a ten year low against the yen.
Now Walter Russell Mead is reporting that markets around the world have a serious case of the jitters due to the possibility of a European meltdown. “Creating a monetary union without a true federal government is looking more and more like the biggest European policy mistake since Britain and France let Hitler have the Sudetenland.”
It’s not just Greece. Investors are now worrying about the potential solvency of French banks.
Last week, Powerline linked to this cheerful piece over at Zero Hedge, which outlines some consequences of a Euro breakup: “Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade.” Lovely. Other possibilities: The rise of authoritarian or military governments to contain the crisis, or civil war.
Despite all this, the EU itself, when not pushing for further austerity, denies it’s preparing for a Greek default. Should we be more worried that the Eurocrats running the show are liars or idiots?
Here’s Peter Morici calling Greece to default and abandon the Euro, although comically, he’s saying that it’s Greece that is the exploited nation “at the mercy of Germany and other rich states who exploit European unity to live well at the expense of their poorer brethren.” Of course this is an inversion of the actual situation, with wastrel cousin Stavos living high on the hog off of Uncle Fritz and Aunt Helga’s credit rating.
But that might be coming to an abrupt end. Despite a slew of austerity measures introudced over the weekend, the Greek government only has enough money to last through the middle of October. There are technical obstacles to still more bailouts from Germany, assuming Uncle Fritz was even willing to extend more credit. Signs are that he isn’t. Indeed, German Chancellor Angela Merkel is openly discussing “an orderly bankruptcy of Greece.” The bond market is already treating a Greek default like a near certainty. It seems like the plan to prop up Greece until banks can stick European taxpayers with the bill may be coming undone.
So, you think gold prices would soar, right? Wrong. “Gold futures slumped as traders cashed out of the perceived refuge asset to cover losses in other markets while Europe’s debt crisis seemed poised to take a turn for the worse.” So it’s gotten so bad that traders need to sell gold in order to cover losses in everything else but gold.
Hang on, folks. We could be in for a very rough ride…