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The revelations of Strauss Kahn

by talos Fri May 6th, 2011 at 08:15:26 AM EST

Last night (Tuesday May 3 - Nomad) in one of the most viewed shows on Greek TV, Lakis Lazopoulos a popular comedian showed an excerpt of an edited part of a documentary that has been shown on Canal + last month, if I'm not mistaken. We already knew, since March, that in this documentary, he divulged that the Greek Prime Minister was scheming with the IMF, to impose the sort of Shock Therapy Greece is living through - as the respected daily Kathimerini reported that:

Prime Minister George Papandreou called for the intervention of the International Monetary Fund in Greece at the beginning of December 2009, or two months after he took over the governance of the country, while he was publicly categorically rejecting such a possibility

In fact Papandreou was elected, less than two months earlier, by campaigning against the relative light austerity program that the New Democracy Conservatives ran on (and with quite reasonable arguments) and explicitly dismissing the idea that Greece would have to turn to the IMF for help. His, by know infamous, campaign slogan was "there is [plenty of] money".

The video (it's in Greek but DSK's statements are in French - starting ~ 0:42) reveals that the discussions between the two men involved more than a single communication:


frontpaged with minor edits - Nomad


A quick translation:

DSK: When I said, exaggerating, that when the IMF came to Greece we solved the issue in 15 days, we closed the issue because we were working months before with the Greek authorities and we did so "underground".

Why this? Because the Greek authorities wanted the IMF intervention even if Papandreou for political reasons didn't tell the Greek people. But very early on he had called me. He called back in November-December of 2009, telling me "we need help". And it is true that he had realized that he needed help...

And afterwards came the austerity desert: Dismantling collective bargaining, cutting public services and public employee salaries, shutting down schools and hospitals, increasing official unemployment already around or above 15%, planning to sell off public utilities, including power and water companies, increasing indirect taxes to astronomical levels, gutting public investment... etc.

Papandreou had to know that this was the sort of outcome that IMF programs achieve, especially during a recession, yet he pursued it, vigorously. In the months before Greek bond spreads reached unmanageable levels (and in February of 2010 the budgetary expense of serving the government debt was near a 30 year low as a percentage of GDP) the Prime Minister himself, as well as various ministers, went on record lamenting publicly the state of the Greek economy and the country in general, in the midst of (anyway) deterioriating international perceptions of the country. No effort was made to borrow some (soon to become very scarce) cash at what the Greek government obviously knew were rates lower than what they should expect anytime in the foreseeable future...

I think that whatever one describes as "democracy" in what used to be a western sense, is utterly negated by this blatant behind the scenes scheming. It seems that Papandreou was sold very early on a neoliberal version of "reform" which he knew would be politically impossible to implement under normal circumstances. He campaigned on exactly the opposite platform he is imposing and for which he was not elected. He then claimed "unforeseeable circumstances" to dismiss his party's electoral program.  Thus came to be the IMF "shock therapy" - with what sort of understanding with the ECB and the European bankers one can only guess - and thus the precipitous fall into the economic abyss for the whole of peripheral Europe, a fall that started in Greece...

A final point: I would think that DSK should certainly be aware that by these statements he is "burning" his fellow "socialist" in Greece. Yet he does so. Greek government members have gone on record stating that DSK is in the begining of a presidential campaign where he wants to shift the burden of the plight of Greece to the Greek government and away from him. That might be true - although it is an admission of the disastrous effect that the IMF program has had. Yet it seems to me the large part of the european elites might be getting rid of a "burnt card" in Greece, leading an increasingly unmanaged and unmanageable country. What comes next however is impossible to see now. Apart from disaster that is...

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That's indiscreet of DSK, to say the least. I haven't heard it being picked up in the media here after the documentary was screened by Canal+ (I don't subscribe so didn't notice it).

One could read it as DSK vaccinating his image against potential Greek infection, or as communication within the limits of the "we soc-dems are Serious People" narrative (ie, we rise above the whims of the electorate to deal with the greater Seriousness of the problems facing our countries).

In terms of DSK's image, anyway, it could be turned round and used against him: evidence of quite undemocratic planning to make ordinary people pay for the financial sector's fuck-up. As for Papandreou's image... It looks like the last nail in the coffin. (Except among the Serious People).

by afew (afew(a in a circle)eurotrib_dot_com) on Thu May 5th, 2011 at 02:14:43 AM EST
Somewhat related: a friend who's a longstanding member of the PS tells me that DSK is violently hated by a large part of the party militants (all of the left part of the party, basically), so if he is a candidate, it's not going to be an easy ride.

And of course, the big scandal of the day: the picture where he is seen coming out of a Porsche:

published in Le Parisien and generating a huge debate here in France...

Wind power

by Jerome a Paris (etg@eurotrib.com) on Thu May 5th, 2011 at 02:39:23 AM EST
Tomorrow you'll see a pic of him getting out of his own deux chevaux. ;)

Hey, Grandma Moses started late!
by LEP on Thu May 5th, 2011 at 08:32:37 AM EST
[ Parent ]
The Porsche actually belongs to Ramzi Khiroun, spokesperson for the Lagardère Group, according to L'Express.

Khiroun, a former adviser to DSK, reportedly offered to chauffeur DSK and wife Anne Sinclair to their dinner appointment, when the picture was taken.

And has there been any doubt that DSK is a TINA guy?

by Bernard (bernard) on Fri May 6th, 2011 at 12:02:01 PM EST
[ Parent ]
And this is how European Social Democrats do policy behind the scenes?

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Thu May 5th, 2011 at 04:48:12 AM EST
A vote for the PES is a vote for the EPP. A vote for the EPP is a vote for the PES. Support the coalition, vote EPP-PES.

- askod

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu May 5th, 2011 at 04:55:59 AM EST
[ Parent ]
In my reading, DSK's claim means that Papandreou saw that Greece's finances are unsustainable, and being beholden to neoliberal thinking, saw neolib 'reforms' as the only possible solution – and thought that he can put them into practice without too much poll number damage if it is seen by the population as IMF dictate. However, I can't think of a single government, especially left-wing, that executed a shock therapy under IMF command and survived it electorally. Then again, believing otherwise would be par for the course for our totally self-defeating centre-left.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu May 5th, 2011 at 05:08:44 AM EST
Maybe we can start calling the Social Democrats center-right by virtue of their economic policies, and given that the EPP is actually extreme-right.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Thu May 5th, 2011 at 05:49:46 AM EST
[ Parent ]
The same shit everywhere.

In Spain Zapatero won the second term lying about the crisis, saying the wasn't any crisis, but his government didn't publish the building and mortgages data compiled by the National Statistics Institute to avoid terrorizing european banks.

No he's practicing Shock Doctrine Lite, but after the municipal elections he'll be writing new austerity laws every friday with his ministers. And this is before asking to be rescued.

Yesterday he was congratulating Obama for murder.

But his peak moment was four years ago, saying that Spain GDP would ahead of Germany's by 2010.

If you don't believe me:

http://www.eleconomista.es/espana/noticias/131410/01/07/Economia-Macro-Zapatero-asegura-que-Espana-s uperara-la-renta-per-capita-de-Alemania-en-2010.html

This summer we'll probably see if Europe can bail out Spain or we sink.

by kukute on Thu May 5th, 2011 at 10:14:38 PM EST
This is why I think any institutional approach is hopeless. What is a decent alternative to PES parties? In most countries there is none.

At the top level we are stuffed.

Low level organization. Informal solidarity networks. Time to bring in a bit of Proudhon.

by cagatacos on Thu May 5th, 2011 at 11:38:48 PM EST
Maybe we could call this "the Apocalypsis of DSK"...

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Fri May 6th, 2011 at 07:54:34 AM EST
This reminds me of the summer of '08 when I was asking if any were effectively pushing alternative narratives and ways to frame what was clearly looming by August. Your answer then was "no". The best answer now is "just us."

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 9th, 2011 at 12:20:59 AM EST
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