Wednesday, July 08, 2015

Forced jubilee

Throughout recorded history, the peoples who live in the area known as 'Germany' have had tremendous power, and have used that power unwisely and meanly (and in the long run, seriously against their own interests).  Why should it be any different now?

Note how the media have conveyed the PR campaign that Merkel and Obama are the good, reasonable ones.

"Where Greece Should Go from Here":
"Let’s cut the crap. Merkel has come back and said that Germany will not allow debt reduction and insists on austerity—and harsh austerity, worse than the last offer. She is backed by most EU members and the European Central Bank, which has put the screws into Greece so hard that imports are piling up on docks because Greece can’t pay for them.
Syriza needs to get its act together. The Euro is a stupid idea, and it always was. It cannot work absent central fiscal policy (aka, national governments reduced to de-facto provinces). It does not allow governments the ability to devalue their currency when they need to increase exports, to print money, and so on.
It cannot work. It never could, as designed. It was always a stupid idea."
"Oh, it could be fudged. They could forgive Greece’s debt (but then would have been expected to forgive a bunch of other countries some of their debt), and money could be funneled to Greece in various ways and so on. But that can’t be done because of neo-liberal doctrine, which insists that debts are sacred and that creditors must never lose money, which is ludicrous and a direct violation of how capitalism works. People who make bad loans MUST lose their money. Without that, it isn’t capitalism and the virtues of capitalism don’t work.
This is not in question. This distribution of money to people who know how to make a profit and not lose it (and thus make “Productive” use of it), is about three-quarters of the pragmatic argument for capitalism."
and (the most obvious; my emphasis in red):
"Syriza needs to leave the Euro. They are not going to get a good deal, or even a mediocre deal from Europe. They will be better off leaving the Euro. If they do so, they should simply repudiate all debts.
Yes, all of them. Once they leave the Euro, Europe and the neoliberal order will go all out to crush them. It does not matter what they do, they will be target number one.
They should then cut a deal with Russia for oil and a pipeline, and align solidly with Russia and China, asking for aid from those two countries.
They should cease any attempts to stop refugees from flooding out of Greece into the rest of Europe. Heck, put them on buses and ship them to the border.
They should nationalize the distribution of food grown in Greece. Greece grows enough food; just start delivering it to every household. Saddam did this effectively, Greece can too.
That takes care of oil and food (Greece has plenty of refinery capacity).
Medicine is the next issue; Greece will have to arrange to get the meds it needs through Russia and China.
There are other details, but mainly Greece should do everything it can short of leaving the EU (not the Euro, the EU) or going to war to make Europe’s life miserable. Why? Because then they have something to negotiate with."
It is interesting that debt haircuts should be a big part of official capitalism, using the markets to weed out bad credit decision makers from good credit decision makers. But, due to the religious sanctity of paying what you owe, debts can never disappear.

"Why Greece will have to exit the eurozone"

"Countdown To Grexit":
"Supporting some partial debt jubilee now, hardly noticeable when stretched over decades, and giving the Greek economy the ability to grow out of debt would be much cheaper for European taxpayers than a complete Greek default which will trigger the payment of hundreds of billions of guarantees. With an exit from the Euro such a default is very likely. Greece would then have no debt at all. It could again borrow from maybe Russia and other sources who would be happy to make some money lending to a then nearly debt free country."
The deep reason why corrupt European politicians are so intransigent is that they participated in a scheme using Greece to bail out their own insolvent banks (and thus their 0.1%), banks that were insolvent due to loans made on bad and greedy credit decisions based entirely on the 'moral hazard' that they knew they would be bailed out.
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