Posted on 06/17/2012 8:05:24 AM PDT by tcrlaf
Here we go again, Groundhog Day. And likely with almost the same result as last time likely.
Interesting quote:
Condemning the outside interference in the election, Greek blogger Nick Malkoutzis, who is also deputy editor of deputy editor of Kathimerini English Edition, writes that "Europe that has become scared of democracy".
UK Guardian is Live-Bogging, with updates every minute: http://www.guardian.co.uk/world/greek-election-blog-2012/2012/jun/17/greek-elections-greece-polls-live?newsfeed=true
Addiction to socialism kills...
Could Greece leave the EU without collapsing? Greece has one of the most radical of the still-existing Marxist movements (although I’ve never understood why) and I think the only thing holding the country in place is that it has to look “respectable” for the EU.
That said, even if the New Democracy party has won, I’m not sure that’s enough. They will have to form a coalition to govern. What I have read is that a lot of the young people who were the last-minute voters voted for New Dawn (think Ron Paul), which is wrongly considered neo-Nazi, but in any case wouldn’t be very cooperative with the more mainstream conservative party.
Another poster on another site said that the collapse is inevitable regardless of which party wins this election.
I am not sure about the probailout coalition. I was trying to piece things together from different sites.
Maybe it is more correct to assume that all this election will do is put off a more dramatic decision once again on the future of Greece and the Euro.
It is liking watching a country bleed out while people are arguing what bandage to use. However, the patient is picking at the wound making it worse.
Meanwhile, I will work on convincing my husband we need better preps than a few weeks and buy more ammo.
I suppose there are emergencies when government intervention can be positive. Spain, after its Civil War (which should really be referred to as Attempted Communist Takeover), instituted a system that was half-state, half-private, and which didn’t give Spain great growth but at least enabled the population to survive.
Germany got all sorts of benefits after WWII, and even the Russians were beloved of most of the US intellectual elite, but Spain was an outcast because Franco had actually defeated Marxism in his country. Leftist US intellectuals rallied together to punish Spain and for many years Spain was excluded from US generosity. There was genuine hunger and deprivation in Spain, and Franco instituted a number of government policies that would one day come back to bite Spain after the Socialists took over upon his death...although perhaps these policies were necessary at that time.
I am not that familiar with Greece, and I have always wondered at the origins of this hard-core socialism. Also, I wonder if the roots of the problems of these three southern countries (Greece, Spain and Italy) actually go back to WWII and the situation after it.
So in Europe, you pour gas on a fire to make it go out. Got it!
According to Keynes, yes if you just use enough gasolene.
Greece will collapse.
Right now Greeks are taking all their money out of Greek banks. Because of the way the ECB functions all of these withdraws are AUTOMATICALLY replaced with ECB funds (same for all EU countries).
What’s going to happen very soon is that Either Greek government imposes capital controls (won’t happen) or the ECB stops replenishing the Greek banks. This will be the zero hour or tipping point of the crisis.
Greek citizens are trying to lock in the value of their Euros now before Greece exits the Euro and capital is immediately frozen and converted to Drachmas becoming substantially devalued in the process.
If it becomes clear that this is a wholesale bank run (it is by the way), and not just a momentary panic that will subside, someone has to act. Either the Greek government imposes capital controls and freezes the movement of depositors cash out of Greece so the banks can continue to pay their debts. Or the ECB stops the automatic replenishment of withdrawn Euros to Greek banks and thus ensures the Complete collapse of the country.
This is such a precarious unprecedented situation because by imposing these capital controls the Greek government would be accepting a loss of sovereignty on the scale of losing a war and if the ECB stops this replenishment they will be taking responsibility for potentially knocking over the first domino in a sequence that no one knows the extent of. The leaders of the ECB are of the opinion that they don’t have the political authority to make that kind of decision. I woud agree.
But in the meantime Europe continues to pay for the Greek collapse by essentially funding a bank run.
The whole story is that the ECB can afford to do this. But the same account patterns in Greece that began the current money migration out of the country’s banks can be seen in data from Spain and Italy. That, the ECB obviously cannot afford.
I read a few comments like those. Many in the Greece government have a great affinity towards Marxism. Coalitions will have to be formed -- and that is the problem.
True solutions cannot be realized with coalition building. The far-left party will likely come in 2nd or 3rd. They will not be willing to support reforms needed to get Greece back onto a strong economic footing. They are against strong cost-cutting measures.
With Greece, and likely Spain/Italy next, we are witnessing the last gasps of Socialism's death grip. True reform will not come from a governing coalition.
True reform will come when the inevitable collapse happens and sweeps aside the economic controls and policies that have made Greece a basket case.
A good sign that he collapse is sooner than later is the fact that bartering is sprouting up all over Greece. People are voting with their dollars and that is a good sign. This will bring needed benefits to the participants and put more pressure on the government.
This will help the Greeks get back to understanding the benefits of individual effort and the rewards that follow. That will help hopefully install some added distrust of government (which many already have)
“I am not that familiar with Greece, and I have always wondered at the origins of this hard-core socialism. Also, I wonder if the roots of the problems of these three southern countries (Greece, Spain and Italy) actually go back to WWII and the situation after it.”
In a nutshell yes. Greece, after WW2 and the expansion of the USSR, was seen by the CIA and Eisenhower administration as the lynchpin separating communism from invading western Europe. The U.S funneled money first to the Military junta and then the socialist government which both managed to retain power for long periods of time by creating a welfare state whose stability everyone relied on for survival.
This is the short and generalized, but 100% true, history.
Thank you! Thank you! Thank you!
Golden Dawn has been described here on FR as neo-nazi. I suspected that wasn’t true.
Thank you for the clarification.
"The 1967–1973 period was marked by high rates of economic growth coupled with low inflation and low unemployment."
Democracy always finds a way... the same way... to handle crises.
Judging from the equivocal vote today We'll be seeing if the European Central Bank can do as well for the Greeks as the Colonels did.
I believe the line that we use at TF is that "America destroyed the economic capabilities of her competitors".
FR doesn't do economics well. You're wasting your talent here.
See, they actually believe that both parties & Wall Street didn't gang-rape the peasants.
"Your Daily Greek Update. SAVED or not SAVED?" @ TF. (It's a mocking reference to the market gyrations associated with the weekly Greek high-wire act)
“Judging from the equivocal vote today We’ll be seeing if the European Central Bank can do as well for the Greeks as the Colonels did.”
Yea. The sad thing is the Greeks don’t seem to understand that is the only option other than withdraw, take the pain, rebuild, and come back. This is what is favored by Golden Dawn. This is what is favored by most hardworking industrious Greeks with pride. Unfortunately that isn’t most Greeks.
If Poland can do it, so can Greece. Only there is to fear is fear itself, and all that. People think FDR said that about the War, but he said it about the depression.
People who actually hold anything in Greece are definitely panicking,and with good reason, but of course the group that caused all of this in the short term (although, as you say, this goes way back to the post WWII period) seems to be blissfully unaware. I don't know where they think Greece is going to get the money to support them in the lifestyles to which they have become accustomed.
One of the frustrating things about this is that there is such a level of denial and unreality that you really wonder how these people manage to get their shoes and socks on in the morning.
One of the great things about the US is that we do NOT have a parliamentary system. This "coalition-building" stuff prevents anything from happening, ever. I have always thought that one of the things most of the EU nations needed was a reform of their system.
The parliamentary system works (sort of) in England, which was its source, but in the rest of Europe, it prevents any serious or radical change. It has been one of Spain's big problems, since the two major parties have been at the mercy of the tiny nationalist parties in order to govern. The result was that these regions ended up collecting a fortune in government subsidies (a polite word for pay-offs and bribery) and actually became a major factor in destroying the Spnish economy. The Spanish government announced less than a month ago that it was cutting off the lavish subsidies to the regions, and there has been a lot of hysteria since then.
There is rioting going on right now in the coal mining districts of Northern Spain (which were a hotbed of radical Marxism back in the 1930s) because of the loss of government subsidies. The union miners, obviously trained in the techniques of the nearby Pais Vasco, have been bringing out shoulder-held grenade launchers and firing on the police all day.
Naturally, this isn't being reported in the US press. I'm sure similar things are happening in Greece.
No, it looks like ExPat got an actual education.
I'll just point to the fact that the incompetent thieving clown (and vampire squid alumnus) Jon Corzine has not yet even been arrested.
A capitalistic worldview and its ensuing wealth is the by-product of the freedoms enumerated in our Constitution under a rule of law.
There is no law in McMinn County...
I don't think so, in either short- and long-term horizons.
Short-term, yeah Mario has Japan lined up, China in the background, but for how much and how long? And then who has the money to buy up the vaunted Euro phantombond once issued? And who would want it, even with German backing?
Then long-term, it is exactly as Nick Dewhurst said:
"The basic question is that a German has to increase working from 65 to 67, and that is to pay for Greeks retiring at 50. The 17th of June is the perfect opportunity to say either 'we’ll behave' or 'we’ll carry on cheating'." -- Nick Dewhirst
“Euro phantombond”
Great name!
Federalized European debt is necessary though. The alternative is a regression to the conditions that led to centuries of war on the continent.
Is this "a federalized debt union in which eurobonds would be backed by all nations"?
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