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Levy your myths on Greece

by talos Thu Jun 7th, 2012 at 04:28:19 AM EST





"Greece must be clear that it agreed to this rehabilitation program, there is no alternative, if it wants to remain a member of the Euro-zone,"
- ECB executive board member Jörg Asmussen

Rehabilitation implies a return to health, or to normalcy, of course, and two years after the therapy started, the patient is sicker than ever, undeveloping and suffering societal collapse.

That these fiscal doctors are quacks therefore is indisputable. That they have no ability to learn from their mistakes or, perhaps, that indeed this political butchery is not incidental but purposeful, is evidenced by their persistence on the social and economic disaster being visited by the Frankfurt Consensus (worthy heir to the devastating Washington Consensus) not only on Greece but on country after peripheral country in the EU, a policy cancer that is metastasizing to the EU core - again, perhaps as intended...

front-paged by afew


I'm leaving aside the horrifying casualness with which all sorts of European officials consider or even advocate the removal of a member country from the euro. This is simply indefensible, and even "respectable" authorities call it for what it is: propaganda meant to influence the Greek electorate, terrorize them into passivity and acceptance of their fate avoiding the feared radicals... These are the sort of statements that have immediate market consequences and this is something that is possibly even illegal but certainly breathtakingly irresponsible, especially since a Greek Euro-exit has the potential to become a cataclysmic world-event.

Let's focus instead on the dominant distorted narrative about Greece and the way it is influencing not just consumers of propaganda, but even the people setting the agenda. How indeed policy makers and mainstream analysts have internalized as objective facts, all sorts of flawed arguments about the Greek crisis. This is not a fluke, it is a practice: cherry-picking or even inventing facts (as we have seen many times in the case of the EU crisis), setting up policies with no evidentiary base and with a historical record of failure, married with the sort of de-politicization of economy that is a hallmark of neoliberalism, an apolitical economy in which systemic analysis is eschewed in favor of conceptually flawed yet elegant models, and  whose accompanying rhetoric are moralistic bromides. And of course ignoring the complete failure of all "official" economic predictions. Until recently I believed that the dominant misrepresentations about Greece from the EU were no more than cunning and amoral political posturing. More and more I am coming to the conclusion lately that this complete lack of understanding of the Greek economy, what went wrong and who is to blame for its implosion, is not a bug but a feature of the austerian world view, a prerequisite for viewing the imposed policies not only as desirable but as inevitable. There truly Is No Alternative, if you filter your inputs appropriately...



Dr. Jörg Asmussen: Clueless in Frankfurt

Take Jörg Asmussen, an ECB Executive Board member now, and until recently "State Secretary at the German Federal Ministry of Finance, responsible for the Directorates Fiscal Policy and Macroeconomic Affairs, Financial Market Policy and European Policy". Surely a man who is intimate with basic facts about the Greek economy, right? Well... not exactly.

In an interview last September in Vanity Fair, Asmussen states the following after reading an IMF report on Greece (emphasis mine):

"They have not sufficiently implemented the measures they have promised to implement," he says simply. "And they have a massive problem still with revenue collection. Not with the tax law itself. It's the collection which needs to be overhauled." Greeks are still refusing to pay their taxes, in other words. But it is only one of many Greek sins. "They are also having a problem with the structural reform.
Their labor market is changing--but not as fast as it needs to," he continues. "Due to the developments in the last 10 years, a similar job in Germany pays 55,000 euros. In Greece it is 70,000." To get around pay restraints in the calendar year the Greek government simply paid employees a 13th and even 14th monthly salary--months that didn't exist.
"There needs to be a change of the relationship between people and the government," he continues. "It is not a task that can be done in three months. You need time."


Asmussen thus makes two assertions that supposedly support his position: One: that a job in Germany pays less than a similar job in Greece, and that the "13th and 14th" salary is a scheme that the Greek government invented in order to pay employees more. The first assertion is mindbogglingly wrong and the second assertion is not even wrong. As this is illustrative of the the extent of the empirical void upon which the austerity prescriptions are built let's see some data:


Average gross earnings in Greece are a fraction of earnings in Germany, there were very few people, if any, in Greece that made more on any given job than their German counterparts. It is not clear if Mr Asmussen is talking about private sector jobs (which talk about "labor markets" in Greece indicates) or public sector jobs (which would be consistent with government paying salaries as stated in the next sentence). Yet in neither case is it true that Greek jobs were better paid (not even in purchasing power, as Athens is more expensive than all major German cities). Greek median salaries in fact were consistently either the lowest in the EU15 or second lowest (after Portugal), and that applied especially to low and mid-range jobs (see here - warning Google translation!). The large gap between salaries for jobs at the top and average salaries was mentioned in a Greek Unions' report for 2007:

In Greece the mean wage is approximately €1,250. In other words, 50% of paid employees receive gross monthly pay of less than €1,250. Average gross monthly pay stands at €1,668, much higher than the mean wage, since 15% of paid employees have extremely high wages, which raise the average, creating false impressions regarding the great majority of paid employees. The threshold below which workers are designated as low-paid is 2/3 of the mean wage, i.e. around €830 a month. Based on this figure, 22% of workers in Greece are low-paid. The purchasing power of the mean gross wage in Greece in 2007 was 83% of the average in the EU15. Only in Portugal was the purchasing power of wages lower (61%).

Since then, salaries and wages have been declining rapidly: by more than a quarter in 2011 according to the OECD, and heading towards a further 25% reduction in 2012.

If one was to examine compensation in public sector jobs, teachers were indicative: both entry and end-career gross salaries for teachers in Greece were around~60% of those in Germany. 

Recently some Greek teachers had to actually pay in order to keep their jobs, while the decline is significant and net salaries start at about 600 Euros per month, not reaching much beyond 1400 euros... Thus the average Greek teacher now makes a third to a quarter of what a German teacher makes, in a country that is more expensive than Germany...

Asmussen's second point is even more breathtakingly uninformed however: the so-called "13th and 14th" salaries are in fact: a. given in both the private and the public sector, b. not bonuses but a way to distribute annual salaries (which is what counts - duh!) in a way convenient for most Greeks and c. in place practically immediately after WWII, legally generalized in 1981 but based on a practice dating back to... 1822 [Google translation]. 

This is common knowledge in Greece, but apparently a man who gets to decide on the survival of the Greek economy and issues warnings and threats, while chiding the locals for imagined shortcomings, does not need to actually have any idea about the economy he is helping destroy...

Finally one cannot help but note that the troika under ECB supervision and the German government's acquiescence has cut down in numbers of, and reduced salaries in, exactly the government mechanism that is supposed to collect taxes. Unsurprisingly this has not made the tax collection mechanism more efficient or less corrupt...

So let us recap: important German Finance Secretary in charge of European policy gives interview in which he shows clear signs of getting his data about Greece from Bild and similar paragons of journalistic integrity. This would not have been the first time a German public official adopts anti-southern populism as a guiding light for policy recommendations, but since this was an interview in a US magazine, in a clearly relaxed conversation one is lead to believe that Mr. Asmussen's misrepresentations about the Greek economy were not a guise, or a political stratagem but a real gaping hole in his understanding of the situation...

So what could be worse for Greece than a clueless German Central Banker? A clueless IMF director perhaps...




Lagarde: Most children in Greece are not starving to death, Greeks will have to try harder - till they do

Mme Lagarde, IMF director was quoted in an interview a few days ago in the Guardian talking about many things - Greece and the crisis among them. She seems to have a problem with social categories and logical consistency though, and I'll quote here the whole relevant passage:

So when she studies the Greek balance sheet and demands measures she knows may mean women won't have access to a midwife when they give birth, and patients won't get life-saving drugs, and the elderly will die alone for lack of care - does she block all of that out and just look at the sums?

"No, I think more of the little kids from a school in a little village in Niger who get teaching two hours a day, sharing one chair for three of them, and who are very keen to get an education. I have them in my mind all the time. Because I think they need even more help than the people in Athens." She breaks off for a pointedly meaningful pause, before leaning forward.

"Do you know what? As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time. All these people in Greece
who are trying to escape tax."

Even more than she thinks about all those now struggling to survive without jobs or public services? "I think of them equally. And I think they should also help themselves collectively." How? "By all paying their tax. Yeah."

It sounds as if she's essentially saying to the Greeks and others in Europe, you've had a nice time and now it's payback time.

"That's right." She nods calmly. "Yeah."

And what about their children, who can't conceivably be held responsible?

"Well, hey, parents are responsible, right? So parents have to pay their tax."


Most of what I wanted to say about this interview, and more, has been said by Alex Andreou in the New Statesman, in an excellent piece where he debunks this nonsense, starting with the implausibility of an IMF head giving two damns about children in Niger, which the Fund has a history of helping to starve in a country devastated more by its policies than draught.

I would simply like to highlight the following from Andreou's article:


Faced with the question of women without access to a midwife when they give birth, patients dying without access to drugs, the elderly dying alone for lack of care and children starving, Lagarde's response is simply to say that it is very easy for them to help themselves. How? "By all paying their tax. Yeah."

That's right. Because, plainly, it is the same mothers without access to midwives, the elderly without care, the sick who cannot afford the newly introduced €5 hospital admission fee, the children without food,
who have hoards of taxable income and are busily trying to send it to banks in Switzerland, while starving. Greece as one homogenous, tax-dodging mass responsible for its own downfall.


Yet this is the quality of the arguments presented here: Lagarde starts from the correct premise that there is significant tax-evasion in Greece and then distributes blame to all Greeks despite knowing (?) full well that it is the richest members of society that have been tax-dodging and evading, while the tax burden on the average working Greek has sky-rocketed. Salaried employees and pensioners i.e. the large majority of Greek taxpayers cannot evade taxes since income tax (along with huge social security taxes) is deducted directly from their pay-checks. That the bulk of tax evasion occurs in the highest income brackets is known, as is the fact that Greek ship-owners are totally tax-exempt (including income of their employees in their offices in Greece), in one of the most tax-friendly regimes for shipping in the World contributing almost zero to state revenues despite contributing near 10% of GDP. Yet these people, along with the bulk of the Greek rich, the real and only winners of the supposed Greek "boom" in the decade before the crash of 2009, are never really targeted by anyone - much less the troika. But Lagarde would naturally feel sympathy for her peers in tax-exemption and income level as she pays no taxes at all on her close to half a million dollar annual salary in the IMF...

Lagarde's comments about the parents of hungry Greek children being guilty of not paying taxes  also fail simple logic: obviously all such parents do not have to pay income tax, since they are demonstrably under the 5000 Euro/year tax floor which the IMF is working hard to remove, having as a maxim that the only kind of taxes it likes are those on the poor and the middle class. They do however pay VAT which has increased to 23% in general, and 6,5% for basic necessities. The really big tax-evaders most definitely do not have starving children... instead they have property in London, and bank accounts in Switzerland and Germany.

But let's focus on taxes and see some of "tax - reform" proposals the troika is trying to impose - probably successfully if pro-austerity parties win in the coming elections. [My comments in italics next to the proposed measures]:

The basis for the envisioned changes in the new taxation system will reportedly be the IMF and European Commission's proposals - included in their recently released reports... Among others, these should include:

i) elimination of several tax exemptions (related to e.g. medical visits and hospital fees) and of special privileged status for certain taxpayer categories; [privileged = sick people]

ii) abolition of the VAT discount on islands and an end to reduced income tax rates for those who live in islands with fewer than 3,100 inhabitants; [privileged = people who leave in remote areas and need incentives for remaining there and aid to counter the costs of isolation]

iv) reduction in income tax brackets from 8 currently to 5, including a reduction in the upper tax rate for personal incomes to 40% from 45% currently. A reduction to the tax-free threshold of €5,000 per year to €3,000 or its complete elimination may also come under consideration; [That means "lower taxes for the rich, higher taxes for the poor, much higher taxes for the poorest]

vi) adoption of a uniform tax for all business and legal entities at 20% initially, with a option to reduce it further (to as low as 15%) once domestic economic conditions stabilize; [Thus mega-corporations and small shops in the same tax bracket. Again less taxes for the rich, more taxes on the poor]


Plus the property taxes imposed are set up in such a way that the home-owner is taxed at the same rate as the bank which owns 100.000 buildings and houses around Greece... The property taxes prescribed by the IMF for home-owners and small scale owners are confiscatory in their extent under the economic conditions prevailing in Greece right now.

So much for everybody paying their fair share, eh? Somehow the monstrous regressivity of the troika's tax proposals is seldom mentioned in much of the international discussion about Greece.

International Press: A vibrant mythology

The stereotypes and misinformation about Greece being pushed by MS media around the world are legend. The mention of Greece's "bloated public sector" is part of the standard clichés about the Greek crisis, seen i.e. in this article in the New York Times from this past autumn:

Some experts believe that Greece could reap significant savings by reducing its bureaucracy, which employs one out of five workers in the country and by some estimates could be trimmed by as much as a third without materially affecting services. But though salaries have been cut, the government has yet to lay off anyone.

Although I've been through this issue on this blog many times let me point out the mistakes in this single paragraph:

Although Greece could indeed reap significant savings by reducing its bureaucracy, this bureaucracy is not a fifth of the workforce. The total number of public sector employees (and that includes Greece's really bloated military, police, doctors, teachers, etc) is under 15% already and heading South fast. Here are the official, updated numbers on Greek public sector, (total workforce = approximately 5 million) and here are the real facts about public sector employment. The bureaucracy is a much, much smaller subset. However even if it was true that one could trim down this, small, bureaucracy by a third without materially affecting services, this would be a process that would necessarily extend over the space of 5-10 years, and would require a surgeon's scalpel. Instead what the IMF is insisting upon is indiscriminate firings in all sorts of public services that have nothing to do with bureaucracy in as little time as possible and through a process that utilizes an axe. As a result, public services have deteriorated to the point of total collapse, creating functional problems where there weren't any before and undermining public health, education, tax collection, infrastructure etc. The government was loathe to lay people off (it reduced the numbers though, only a bit more gradually than the IMF would like) because already at that time unemployment was pushing towards 20%, a milestone already passed now, and they were scared of the social consequences...

And this was in the NYT, not some yahoo red-state rag, failing to even google what they're writing about.

Or take this recent report from Reuters ("Greeks embrace some new myths about life with the euro") where real attitudes in Greece are misrepresented and contrasted to a supposed determination on behalf of the Eurozone to "kick Greece" out. It is implied that Greeks are delusional because they want both an end to austerity (which has failed in every goal it set and has driven Greece to a depression greater than the US depression of the 1930s) and to remain in the Eurozone. The authors seem to think that this is impossible and it may yet be, but there is no evidence presented for this. Nowhere is it even hinted that the whole austerity policy was a failure, or that the measures being demanded of Greece in return for the bailout lead Greece to the Third World (not to mention out of the eurozone) and are causing already a humanitarian crisis in the country. But see how the issue is framed:

Solemn warnings from abroad that Athens cannot stay in the Euro while rejecting the terms attached to the billions offered to pull Greece out of its financial hole are widely disbelieved in a land that considers itself the envy of foreigners

Note that these billions are "offered to pull Greece out of its financial hole" according to the article despite the rather evident fact that these billions have actually dragged Greece deeper into a financial hole, caused a societal disaster and have sabotaged the economy to an extent that will require a decade of rapid recovery to mend. The Greeks have this funny notion that failed programs should be stopped not because this is rational, but because they generally entertain quaint notions such as that their country "is the envy of foreigners" (one would be hard pressed to find a single person nowadays in Greece that would support such an assertion).

In what many foreign partners see as the great Greek paradox, opinion polls show over 75 percent of Greeks want to stay in the euro, but two thirds oppose an international bailout, a
lifeline which came with harsh salary, pension and job cuts.
Frankfurt and Brussels say it is impossible for Greece to have one without the other: no bailout means no euro and a return to the drachma - "drachmageddon", as some Greeks call it.

It isn't much of a paradox however when one realizes that there is no official way of Greece leaving the Eurozone, unless it unilaterally withdraws from the EU, and why would it choose to do that? The paradox is resoled however in opinion polls that ask whether Greeks would prefer to live with the Euro under the terms of the current austerity plan or leave: 47,8% of respondents say that they would then prefer to leave while 41,7% would choose to remain in the Eurozone even under the current plan of permanent austerity according to a recent MRB poll, while the percentage of those that set a limit to the amount of punishment they would accept to stay in the eurozone was 54% (vs 34% and 7% who wanted an immediate return to the drachma) in another poll by Pulse. This is an inconvenient fact that escapes mention in stories from Greece because it reverses the threat: most Greeks are ready to dump the Euro (if they are forced to, because very few wish to leave the EU) in order to avoid austerity - and how ready is everyone else to cope with that?

The other thing often missed when Greece is discussed in the MSM is that the vast majority of funds for the bailout never went to fill the Greek state's coffers, in fact Greece serves as a mechanism for European taxpayer money to end up back at the ECB. Indeed the whole of the bailout has had the effect of giving time to the ECB to transfer debts of private and public banks to its own back, that is again, on the backs of European taxpayers. This too is a nuance often missed by media commentators...

Many parties show no sign of heeding warnings to make clear to a public confused about what is at stake that elections next month are effectively a referendum - euro or drachma.

Again this is stated as fact. Despite the tiny detail that no one is advocating leaving the Euro. And many parties of course do not accept this (false, as they see it) dilemma which the article states as a given. It is not impossible for Greece to be pushed out of the Eurozone. However one could claim that should Greece follow the route of compliance it is much more likely that it will find itself in no time with no euro and even more disastrous conditions, as the eurostorm is breaking all over the continent and predictions about the future of the euro are quite precarious at this point, quite independently from what Greece does.

The narrative sustained by mainstream media, eurocrats and elites around the world, but especially Europe, of a "lazy" and profligate country that "boomed" with "foreign money" and now is getting its just deserts, is false. As is the meme being spread that the IMF/ECB/EU Commission program has anything to do with "getting Greece's fiscal house in order" and helping Greece out of the slump. Actually the troika program is the prime factor behind the collapse of the Greek economy, a collapse almost unique in scale during peacetime. In terms of its stated goals and socioeconomic collateral damage it is an abject failure. The dismantling of the meager welfare state that Greece had to begin with, as well as the demolition of the impotent and poorly implemented pre-crisis labor laws in favor of a framework that converges toward that of a third world dictatorship, coupled with a salary and wage cut, a high inflation rate, >20% unemployment and a mad tax-spree against working people, pensioners and small businesses, is a political project run by dangerous neoliberal ideologues, not an answer to Greece's real deep economic malaise.



The narrative is the message

All these misrepresentations, the silences, the omissions, the outright lies, the misinformation, the urban legends and the often naked condescension, form an integral part of the narrative of Greece, a narrative that is used to legitimize the policies being pursued by the core EU governments to the electorates there, not only by stereotyping but by indirectly implying that solidarity is pointless, and that they mustn't demand too much of the state and their superiors, or else the fate of the profligate Greeks will befall them.

By narrative here I imply a rhetorical tool meant to frame the issues in Greece in such a way as to exclude certain kinds of questions and objections and invite only particular others. Though it is true that in one sense every depiction of events, especially of a procession of events, is a narrative of one form or another,what we have here is a narrative that does not even try to include the relevant facts, but rather to make them opaque, to misrepresent and deny coherently, and by plan. This is a weaponized narrative, in a permanent communication war taking place where societal consensus is forged.

However the thing is that these sort of devices work better if you believe their content. As "the plan" here emerges through the alignment of elite interests, and the reflexes of the already indoctrinated who are in place at critical positions in the political-financial-industrial-media complex that supports and defines the global elites, what you get is Asmussens and Lagardes, and everything from Bild all the way to the WSJ and the NYT: people that at the same time realize the political expediency and the real economic stakes, yet seem to honestly entertain and believe the demonstrably inaccurate BS they are peddling to the population at large, both at home and in the target country: Greece and the PIIGS in general...

Myths prop-up corruption

It is in Greece where the project of the dismantling of the European welfare state, a desire acknowledged by Mario Draghi himself openly, is being tested, after two years of daily struggles the unfolding disaster is leading to an unprecedented electoral result .

Up to a month ago the plan was moving along, supported by massive police violence whenever protesters were on the verge of dominating the streets. These protests however, as they were increasing in anger, determination and ferocity created a crisis of legitimacy, that not even the Greek oligarchs' corrupt media system could impede. In fact the media system's delegitimization was a key factor that allowed the electoral earthquake that followed. Elections were then announced with the widespread conviction that the two-party system propping the bailout and the subjugation to the IMF / ECB dictates, would be wounded yet would have managed to form some sort of legitimate government capable of moving ahead with even more anti-social cuts and productive sabotage...

But things were explosive and SYRIZA, a small party of the radical left emerged as the main beneficiary, electorally speaking, on May 6th, and is poised to win, perhaps even win big, on the repeat elections of June 17. This is met by a chorus of local and european dismay, trying to push the the idea of Greek elections being a referendum for or against the Euro, despite the fact that SYRIZA has been insisting forever that it wants to Greece to remain in the euro, and is arguably the only pro-european party in Greece, if by Europe one means social-europe, the Europe of redistribution and democracy. In fact SYRIZA is fighting a battle that concerns everyone who doesn't want a "Europe with Asian values" as Slavoj Zizek recently pointed out or that sees austerity as the death knell of the Euro and a ticket for re-inventing the 1930s, as Yanis Varoufakis warns...

So the same forces that imposed on Greece a historically failed policy - as part of a political plan, or through sheer dogmatism, it doesn't matter - are now encouraging Greeks to vote for the same two parties that have been historically at the root cause of the Greek economy's many ills. Clientilism and corruption, oligarchs and tax-evasion, public coffers at the service of the bureaucracy/ ship-owner / public procurer / media complex, the underdevelopment of the Greek welfare state, are all the work of the two parties, ND and PASOK that the EU bureaucrats and assorted European elites are basing their hopes on. SYRIZA on the other hand has no clientilist roots, was the only major party opposed to the Athens' Olympics and the Pactolus of funds (total cost is still unknown but estimates reach 30 billion euros) that were diverted there. SYRIZA was the only parliamentary party to note that the funding growth through borrowing, 2,5 euros of debt for every euro of growth as they noted at the middle of the "boom", is a Ponzi scheme, not an economic policy, and that not reducing public debt at a time of growth is suicidal.

But the powers that be are creating a new myth, the myth of the dangerous radicals that are going to wreck Europe, and they are actively supporting the mishmash of carrierists, neoliberals and enablers of corruption that are the two parties - not to mention the scary drift to the far-right of ND that now includes a large part of the extreme-right LAOS, with fascist roots and an anti-immigrant rhetoric that would embarrass Marine Le Pen. The eurocrats and the mouthpieces of global elites are mythologizing the political landscape of Greece and they are still insisting that the disastrous measures that SYRIZA refuses to implement are the only alternative. The process by which Greece and its "radical" choice (and to be frank, SYRIZA's prescription for dealing with the crisis is a bit to the right of Paul Krugman) is to be made the scapegoat for the collapse of the euro project in the new series of myths in the post-euro landscape, is now underway...

The reasons are obvious: they fear a left wing contagion in their own countries they fear an end of the era of rule of the 1%, by the 1%, and for the 1%...

A dilemma will emerge in the coming period regardless of what happens in Greece: the dilemma of whether Europe will drift towards a post-democratic dystopia, or whether social Europe persists and emerges stronger from this chaos. The battle that SYRIZA is facing, unprepared and nervous as it may be, is the first in a political war that can engulf the continent. "They have decided without us, we will go on without them" as SYRIZA's slogan declared. Let's go on without them, then, on a European scale...

[Crossposted at Histologion]

Display:
This is common knowledge in Greece, but apparently a man who gets to decide on the survival of the Greek economy and issues warnings and threats, while chiding the locals for imagined shortcomings, does not need to actually have any idea about the economy he is helping destroy...
He doesn't seem to have much of an idea about Germany either, where a 13th month payment is standard....
by gk (gk (gk quattro due due sette @gmail.com)) on Wed Jun 6th, 2012 at 03:27:58 PM EST
As it is in France.

Where, incidentally, Lagarde was not long ago Finance Minister in a government that reduced taxes on the rich and regularly used as scare propaganda their threats to go and live in Switzerland.

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Jun 6th, 2012 at 04:23:20 PM EST
[ Parent ]
There is this thing called "borders". The argument of "the rich are going away to somewhere else, so we have to capitulate" will someday find a politician that will use the "border" argument quite persuasively. I doubt it will be a good kind of politician, but it seems that we have to go there before the current problems are to be addressed.
by cagatacos on Wed Jun 6th, 2012 at 07:28:15 PM EST
[ Parent ]
This is a weaponized narrative, in a permanent communication war taking place where societal consensus is forged.

I think Robert Reich would agree.

The big-lie coup d'etat - Opinion - Al Jazeera English

I'm not a conspiracy theorist (you can't have served in Washington and seriously believe more than two people can hold on to a big story without it leaking), but I fear that at least since 2010 we've been witnessing a quiet, slow-motion coup d'etat whose purpose is to repeal every bit of progressive legislation since the New Deal and entrench the privileged positions of the wealthy and powerful - who haven't been as wealthy or as powerful since the Gilded Age of the late 19th century.

Its techique is to inundate the United States with a few big lies, told over and over (the debt is Obama's fault and it's out of control; corporations and the very rich are the "job creators" that need tax cuts; government is the enemy, and its regulations are strangling the private sector; unions are bad; and so on), and tell them so often they're taken as fact.



Now where are we going and what's with the handbasket?
by budr on Wed Jun 6th, 2012 at 05:51:21 PM EST
An update on the electoral situation: I got this from f/b via people associated with SYRIZA "high command" and living abroad, since publishing official polls is not allowed 15 days before the election:
Greece: latest opinion polls.According to serious opinion polls to which journalists and Syriza cadres have access (the publication of opinion polls is forbidden since last Sunday, in conformity to Greek law), Syriza leads with 34 to 35%, more than 7 points ahead of New Democracy. The mainstream media almost openly concede defeat and start behaving as an opposition to a still non-constituted Syriza government! So, fingers crossed!

Privately there are a lot of people that reckon that SYRIZA could possibly pass the 37-38% limit that will allow it over 151 MPs and thus give it an outright majority in parliament. The social dynamic in favor of SYRIZA is unbelievable. This transcends austerity and is now also about kicking out the corrupt two-party system, especially as Samaras is drifting into cold-war rhetoric and negative campaigning and is finding excuses to avoid a TV debate with Tsipras. The critical question is whether it will manage to survive the barrage of internal and external attacks it will suffer especially the first few months.

What will Asmussen say and do then, I wonder? Lagarde?

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Wed Jun 6th, 2012 at 08:34:03 PM EST
The mainstream media almost openly concede defeat and start behaving as an opposition to a still non-constituted Syriza government!

I am following thew news on the site you suggested, Athens News, where the hysterically anti-Syriza domestic media barrage is covered in the daily press reviews. But the site is odd because their news articles are quite acidic in pointing out the idiocy of establishment party and media representative claims, but then there is this editorial which accuses Tsipras of populism, political opportunism, tough talk instead of substance, and claims he is not aiming for an unspecified "real change".

The critical question is whether it will manage to survive the barrage of internal and external attacks it will suffer especially the first few months.

I hope they are preparing for it. Also, I hope they have some odea of what to do with a police of which apparently 50% voted for the Nazis (one difficulty for SPD governments in Weimar-era Germany was the disloyalty of police and gendarmerie, though that doesn't excuse their strategic mistakes as they had other means left unused).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Jun 7th, 2012 at 05:57:24 AM EST
[ Parent ]
This morning, a pre-election panel in a morning show on Greek TV. You don't need to know Greek, but watch it to the end. Spot the Nazi and the representatives of the Left

After this the Nazi representatives have been "withdrawn" from TV debates. Don't know if this costs them or is exactly what their base wants of them. There is now a warrant for the Nazi's arrest, who was elected May 6th, and is currently on trial for robbery and grievous bodily harm....

The Athens News editorial is relatively soft on SYRIZA compared to the constant barrage of attacks they are receiving (and of course with Chryssi Avgi present they are pictured as the one end of the "two extremes" threatening the country).

BTW do you have any sources on the SPD / cops issue in Weimar Germany? It seems interesting at this juncture.

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Thu Jun 7th, 2012 at 06:38:44 AM EST
[ Parent ]
Athens News story on the studio scuffle, which also notes the inaction of the representatives of the other parties. What's IMHO much worse is the barely controlled Chryssi Avgi attacks on immigrants (for which they then deny responsibility).

The Athens News editorial may be soft compared to the MSM attacks, but it is in stark contrast to their superficially pro-SYRIZA ridiculing of the established parties and MSM headlines, so I really don't know what to think when they say "real change".

On the SPD-cops issue, I don't have a single source, but this connects to stuff discussed in the recent tussle over Thälmann. The SPD was in the federal government for some time, and ran the government of Prussia state for even more time. The SPD replaced the top leadership of the Prussian Police, but not the lower officers and common cops. Although the SPD leadership was complicit in the events of 1929 called Bloody May (their minister issued the ban and didn't pursue repercussions against police excesses), that was partly because they couldn't rely on police, and indeed Social Democrats were killed in the lethal police attacks, too. Later, in July 1932, there was the Bloody Sunday of Altona (now part of Hamburg), when it was again police called in by an SPD man ran amok. A few days later the SPD government of Prussia was toppled in a semi-coup (Preußenschlag), with some police cooperating with the coup and all the rest standing down, as the SPD choose to not call on them to defend the government (officially to avoid a civil war, and obviously because loyalty wasn't certain). Later Göring became Prussia's interior minister (and created the Gestapo out of a branch of the Prussian Police).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Jun 7th, 2012 at 08:19:59 AM EST
[ Parent ]
What's IMHO much worse is the barely controlled Chryssi Avgi attacks on immigrants

And that continues, making headlines when bystanders are hit too:

Israeli journalist beaten by masked mob | Athens News

...Gil Shefler, a reporter with the Jerusalem Post who was in Greece on assignment, went to the area at around 8pm to take a photograph of the National Archaeological Museum.

On his way, he noticed dozens of migrants being chased on an adjacent road to Patision Ave by about twenty masked men bearing sticks and batons.

When the mob began beating the migrants, Shefler said he "instinctively I took out my camera."

"I snapped a photo and one guy came up and told me 'Listen, don't take a photo. They'll beat the hell out of you.

"Seconds later, I was being chased by five of these people. They caught me and beat me with sticks for around five minutes, I reckon."



*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu Jun 7th, 2012 at 12:07:07 PM EST
[ Parent ]
The pogroms continue, and the pretense about "illegal" immigrants is dropping:

Egyptian beaten in suspected racist attack | Athens News

A 28-year-old Egyptian man has been hospitalised with serious injuries after he was beaten in his own home in a suspected racist attack early on Tuesday morning.

The attack occurred between Keratsini and Perama, outside Piraeus. According to reports, shortly after 3pm twenty attackers on ten motorbikes arrived at the house, where four Egyptians lived.

All the Egyptians are employed as fishermen. According to journalist Niko Ago, the men are legally resident in Greece and came to work under a bilateral agreement with Egypt

Meanwhile, Chryssi Avgi is issuing ridiculous excuse aftewr ridiculous excuse for the studio attack: their man only reacted to the first act of violence by the communist MP, who hit him with papers (that was already in reaction to the glass of water thrown on the SYRIZA MP by the neo-Nazi thug...); this was a planned provocation and their man lost his cool (and surely taking a camera with him to snap photos of studio employees and threatening them was a result of losing cool, too...).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Wed Jun 13th, 2012 at 04:35:06 AM EST
[ Parent ]
...but the "centre"-right is playing the Nazis' game:

News bites @ 10 | Athens News

1. SAMARAS SPEAKS TOUGH Delivering his party's new 12-point programme on immigration and crime, New Democracy leader Antonis Samaras on Tuesday said that: ""Greece has experienced an invasion of illegal immigrants" and "we shall stop it".


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Jun 13th, 2012 at 04:36:54 AM EST
[ Parent ]
There's a study on the rise of the NSDAP in rural Germany that affronts the issue of armed party militias and political rallies during the 20's. I'll have to find it. I think it was published in the 60's.
by de Gondi (publiobestia aaaatttthotmaildaughtusual) on Thu Jun 7th, 2012 at 08:38:43 AM EST
[ Parent ]
Contrast with Germany, where the Pirates prefer beating one another with LAN cables.
Er selbst sei beispielsweise von einem Fraktionsmitglied der Berliner Piraten öffentlich beschimpft und auf einer Landesmitgliederversammlung "mit einem Lan-Kabel geschlagen" worden.
No video, I'm afraid....
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Jun 7th, 2012 at 10:46:06 AM EST
[ Parent ]
They should have used a nine of cats tail. No sense for tradition, young people today.
by IM on Fri Jun 8th, 2012 at 02:51:35 PM EST
[ Parent ]
They sound Spanish...

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Thu Jun 7th, 2012 at 04:23:03 PM EST
[ Parent ]
I hope they have some odea of what to do with a police of which apparently 50% voted for the Nazis

SYRIZA does think of the police, but this is in reaction to repression of past protests:

Tsipras vows to bridge distance between police and the public | Athens News

Coalition of the Radical Left (Syriza) leader Alexis Tsipras on Monday underlined that restoring a sense of security and safety by returning police to neighbourhood beats and "reconciling" the police with the public were two priority issues for his party, following his visit to the Attical General Police Headquarters in Athens.

"It is especially important that we ensure the conditions that will enable every citizen to walk about freely and without fear in every corner of the country, 24 hours a day," he emphasised.

According to Tsipras, the 'bailout governments' had directed resources, manpower and energy into two goals that had nothing to do with the true aim and mission of the Greek police - using the force instead to repress the people's reaction to the "memorandum policies of destruction" and as free security to guard "highly influential persons". Ensuring the safety of ordinary citizens meant returning the police to neighbourhoods, he added.



*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue Jun 12th, 2012 at 04:40:04 AM EST
[ Parent ]
Samaras is drifting into cold-war rhetoric and negative campaigning

Press Watch, June 7 | Athens News

On the domestic front, a huge row broke out over a negative campaign ad by New Democracy. The ad shows a teacher in a classroom listing the countries in the eurozone. One young pupil, a blonde girl, asks why Greece is not one of the countries, and the teacher offers only a dour look of despair.

Of course, the unspoken answer is that Syriza and other anti-memorandum parties led to Greece's expulsion. Critics said that school children were exploited and that the Grexit message is harming Greece.

One of the most notorious negative campaign ads in history - that of US President Lyndon Johnson during the 1964 presidential campaign - also featured a child. There, a girl plucked and counted petals from a flower, and when all the petals were plucked, the ad showed a countdown and a nuclear bomb explosion. The idea was that a victory for Johnson's opponent, ultra-conservative Barry Goldwater, would spell a threat of nuclear war.



*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu Jun 7th, 2012 at 12:08:32 PM EST
[ Parent ]
Maybe SYRIZA should respond with an ad showing Greece in the Eurozone - and no teacher....
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Jun 7th, 2012 at 12:34:52 PM EST
[ Parent ]
Heh. That's twitable :-)

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Thu Jun 7th, 2012 at 12:36:11 PM EST
[ Parent ]
Seems like unpublished polls are de-facto published anyway.

ND and Pasok chiefs fear poll deadlock, urge alliance | Athens News

Conservative-leaning Typos on Sunday said the polls showed New Democracy and Syriza both gaining votes, with a slight advantage to New Democracy. Proto Thema said four of the six polls conducted over the past three days gave a lead to New Democracy.   In one unpublished poll seen on Thursday by the Athens News, Syriza had the lead over New Democracy and would be likely to be in a position form a two-way coalition with the Democratic Left.


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Mon Jun 11th, 2012 at 09:45:29 AM EST
[ Parent ]
Steve Keen was asked during his discussion with Paul Mason at LSE, which the BBC has now broadcast, (minute 13 ff), two months after the fact, how his critiques of current economic theory have been received since events have borne out both his predictions and his analysis. He said, in effect, that he and other heterodox economists - the one out of ten in the typical department - were still ignored. He described the dismissal of his critique as being done with 'a air of effortless superiority'. Mason noted that this was very old school.

I would suggest that this 'air of effortless superiority' derives from the secure knowledge that those exhibiting it are in the good graces of those few who truly matter when it comes to ordering the affairs of the public - those wealthy few. That sense is buttressed by the knowledge that no one in the MSM will blatantly contradict the nonsense upon which they seize for any particular point or occasion, as the MSM is owned and/or effectively suborned by those same wealthy few.

Appropriately, this year's Bilderberg meeting has recently concluded at the Westfield Marriott -- a three-and-a-half star hotel in Chantilly, Virginia. Perhaps, in addition to selecting a running mate for Mittens, they also discussed the latest variations of the myths to be used to frame policy towards Greece.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 6th, 2012 at 11:18:42 PM EST
wow, seriously awesome diary, Talos.

razor-sharp writing, deep historical context, and acutely up-to-the-minute account of life on the ground in Greece.

thankyou so much for fighting the good fight in such an exemplary manner, and sharing your top-notch journalistic skills with us.

when this is over and we're out the other side, Greece will be able to take great pride in not only having invented democracy, but also standing up for its renewal and redimensionising at a time when it has rarely been so sorely needed.

i thank all the greek people of conscience for their courage in facing this latterday Leviathan, with its global tentacles everywhere that otherwise intelligent people, like Lagarde and Asmussen to name but two, have been duped into becoming concsienceless shills for the dark side.

the fact that journalism this superb is on a couple of little blogs, while the soullessly destructive MSM narrative continues to gather pace mystifies me... are most people really that dumb to swallow such murky hogwash over and over?

a diary like this gives me hope again, that one day what you have expressed here can become common knowledge, and we can return power to the people, the original meaning of democracy.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Thu Jun 7th, 2012 at 06:34:29 AM EST
Seconded, and thankful you post here Talos.

"Life shrinks or expands in proportion to one's courage." - Ana´s Nin
by Crazy Horse on Thu Jun 7th, 2012 at 09:38:58 AM EST
[ Parent ]
Yes, seriously and phenomenally awesome piece.

This needs repeating:

SYRIZA on the other hand has no clientilist roots, was the only major party opposed to the Athens' Olympics and the Pactolus of funds (total cost is still unknown but estimates reach 30 billion euros) that were diverted there. SYRIZA was the only parliamentary party to note that the funding growth through borrowing, 2,5 euros of debt for every euro of growth as they noted at the middle of the "boom", is a Ponzi scheme, not an economic policy, and that not reducing public debt at a time of growth is suicidal.

Not sure here in the US that we got a dollar of growth for 2.5 dollars of debt during our boom.  But it apparently doesn't matter when one controls the money printing presses. Here in the US we have but two major parties and both are actively clientilist which is why we lurch from A to B without any positive change for most people.  Why liberals in the US were shocked that a loathsome pol like Scott Walker could survive a recall and yet retain their naive notions of how democracy in the US works.  -- It was Henry Havermeyer who admitted:

... that he habitually contributed to both parties."We get a good deal of protection for our contributions," he said laconically.

Not that he and others like him gave equally to both sides in every election cycle and from 1896 on, the bulk of that money at the national level went to the RNC.  A bit more on Havermeyer from America's Sixty Families (a gem I recently stumbled upon:      

Havemeyer was head of the American Sugar Refining Company, which in 1909 became notorious when it was convicted and fined $2,000,000 for having systematically cheated the customs office over a long period. That the ingenious Hanna, with his Rockefeller tutelage, brought into American politics a new technique rather than a new philosophymay be seen from the size of the funds that have snared American votes since 1860. After Hanna started sculpturing political contours ...
by Marie2 on Thu Jun 7th, 2012 at 02:51:00 PM EST
[ Parent ]
"Rehabilitation implies a return to health, or to normalcy"

You're reading this wrong: we live in Idiocracy. And there, rehabilitation means capital punishment in the most humiliating way possible, while everyone watches.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Thu Jun 7th, 2012 at 07:18:29 AM EST
International Business Times: Greece: Neo-Nazi Golden Dawn Spokesman Attacks Two Woman MPs on Live TV [VIDEO] (June 7, 2012)
Ilias Kasidiaris, who is already facing accusations that he was an accomplice in the mugging of a student, threw his water at Rena Dourou of Syriza (the Coalition of the Radical Left) and then slapped the Communist Party (KKE) member Liana Kanelli three times.

Police have issued an arrest warrant for him.

...

Kasidiaris reportedly threatened journalists and technicians offscreen also.



If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Thu Jun 7th, 2012 at 07:24:48 AM EST
In case any were wondering if Nazi was just a label...

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jun 7th, 2012 at 09:16:28 AM EST
[ Parent ]
Leader Nikolaos Michaloliakos has rejected claims of affiliation with Nazism, even though the party's emblem, a squared spiral, and its colours recall closely the swastika. Michaloliakos made a Hitler-style salute when he was elected in 2010 to Athens city council.
Golden Dawn has appealed to growing nationalist sentiment after harsh austerity measures demanded by the European Union and the IMF helped plunge Greece into economic turmoil.
The party's main policy is to get rid of all illegal immigrants. "No one should fear me if they are a good Greek citizen. If they are traitors - I don't know," Michaloliakos said.

Golden Dawn's anti-immigration campaign was based on the slogan "So we can rid this land of filth".

A video published on YouTube showed muscular supporters of Golden Dawn urging journalists to rise from their seats as a sign of respect for Michaloliakos when he took the stage. Those who refused were expelled from the room.



If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Thu Jun 7th, 2012 at 09:30:07 AM EST
[ Parent ]
In related news: New unemployment record, 21,9% in March...

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Thu Jun 7th, 2012 at 01:41:08 PM EST
Is this more like US U3 or U6?  I do not see how a U3 of >20% could not be acknowledged as depression level unemployment.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jun 7th, 2012 at 01:56:32 PM EST
[ Parent ]
That's more like U3. It is depression level unemployment

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Thu Jun 7th, 2012 at 02:03:11 PM EST
[ Parent ]
Talos thank you for one more lucid opus.

Last week when I went to Vienna for the ASPO conference I happened to stay at the same hotel with my friends from ASPO-Spain, so during breakfast I could train my Castillan. Our talks kept revolving around the crisis, and at some point I said something like: "Dani, this fella Tsipras is promising at the same time to keep Greece in the Eurozone, default on the debt, double the minimum wage and rollback pension cuts. How can anyone believe him?" To which Dani replied: "Desperate people take desperate measures."

The vote for SYRIZA is a vote of desperation, the reflex of a foreclosed future.

Still, I can't possible agree with the conduct of this party, and I'm genuinely concerned of what may happen if they win the election. The letter of intent, which is basically a pre-anouncement of default, was a terrible mistake, that undermines any possibility of success of such line of action. A SYRIZA victory will be taken by the Greek society and foreign investors in general as a default and an exit from the euro (the only way Tsipras has to make good on the largest part of his promises). As Michael Spence put it yesterday, under such scenario everything mobile will simply move away.

The problem is that this will happen with the caretaker government still in place, before Tsipras is sworn in. If this worst case scenario unfolds, Tsipras can simply watch helplessly Greece collapsing, just to inherit the moonscape a few weeks later. At that time, decisions to default or stay in the Eurozone will be irrelevant.

You might find me At The Edge Of Time.

by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Thu Jun 7th, 2012 at 04:34:20 PM EST
Not many decent options after the banksters trash/crash an economy.  But in the long run it might be better to let them take all their movable objects and leave now than let them hang around long enough to acquire ownership of everything.
by Marie2 on Thu Jun 7th, 2012 at 05:24:54 PM EST
[ Parent ]
You simply amaze me.!!!!

In a diary that deals with myths, you still insisting on believing and spewing myths.

"Dani, this fella Tsipras is promising at the same time to keep Greece in the Eurozone, default on the debt, double the minimum wage and rollback pension cuts. How can anyone believe him?"

Do you not realize that every thing in that statement is false (including punctuation marks) or deliberate lies?

by Euroliberal on Thu Jun 7th, 2012 at 05:27:03 PM EST
[ Parent ]
False in what sense? This is the stuff I've been reading in the greek press.

You might find me At The Edge Of Time.
by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Fri Jun 8th, 2012 at 02:59:36 AM EST
[ Parent ]
Well Tsipras:
  • Is not promising to keep Greece in the eurozone. He's claiming that SYRIZA's road is the only road that offers a chance to remain in the eurozone. The other road leads to total societal collapse before 2013
  • He is suggesting a moratorium on debt, not debt cancellation, pretty much on the terms that Germany got in 1953 (offered by Greece among others)
  • He does not promise to double minimum wage but rather: a. Return it to the levels it was in March 2012, and b. Re-establish a collective bargaining system.
  • Will roll back pensions to where they were in March 2012, if I'm not mistaken
  • Note that the 4 month primary deficit for 2012 was something like 18 million euros, only (although the prognosis is grimmer for the rest of the year). True there are arrears of internal debt to suppliers, tax returns etc, but these won't be paid soon anyway...

Basically Tsipras is saying that Greek society will not and cannot continue on the road of the memoranda without exploding soon. And he is offering the EU the only way out of a dead-end policy.

See this interview of Varoufakis in Die Zeit for more (in German, I haven't read it in the original but in Greek translation)

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Thu Jun 7th, 2012 at 07:14:45 PM EST
[ Parent ]
Hi Talos. Presently I read the Ekathimerini every day, and I'm almost certain they published news of the minimum wage being hiked to 1200 €, with no time frame provided, but the figure was written there. They also refer to rolling pensions back to 2009; this was also in the EUObserver, I believe. I haven't read the political programme, which I imagine is in greek, so I acknowledge things can make more sense there. In any case, Tsipras cannot make good on his promises without sending the primary deficit skywards, even if it is presently even. Doing that and staying in the euro is like having sun at the front door and rain in the garden.

I think the election of Tsipras will be the explosion. But I hope I'm wrong.

You might find me At The Edge Of Time.

by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Fri Jun 8th, 2012 at 03:08:54 AM EST
[ Parent ]
Kathimerini is to the rise of SYRIZA what the MS Media in the US is to the rise of the Latin American Left: partisan opponents. The 1200 Euro figure was in the 2009 program (and even then eventually). So was the 100.000 new jobs in the public sector (though they are badly needed for sure). This is admitted now by all.

These wage-hikes however are private sector wages, not public and if anything could have a positive fiscal result. Also note that a raise in lower pensions can and will be accompanied by a reduction of higher pensions. And I would expect that the confidence of many would be affected positively by putting a floor on the austerity disaster...

So this is all theoretically feasible especially since a SYRIZA government will be the only government in recent memory which will aggressively attempt to collect taxes from the rich... But we're entering a highly chaotic period and there are swarms of butterflies around of the sort that cause hurricanes afar... So, who knows?

The election of Tsipras is IMHO the only hope for Europe. But if SYRIZA fails, well, then there is of course the Nazis. It is getting that ugly, thanks to EU solidarity of the sort we have witnessed in Greece lately: to banks

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Fri Jun 8th, 2012 at 04:52:55 AM EST
[ Parent ]
Varoufakis makes a nice job of a fact-based dismantlement of the ruling narrative, but it seems it is all for naught. At one point he counters the narrative that "[the Greeks had it good and] it would be fair if they would show more reform willingness in exchange for bailout money" with a point differentiating between Greeks, saying that for 65% living standards dropped in the "fat years" of 1993-2009 while per capita GDP grew, because a small Greek elite in conjuction with the financial sector in Germany and France hogged all the profits. However, in the very next question, the Die Zeit journalist is again talking about "the Greeks".

And that's how the latest episode in the Lagarde outrage is reported, too. When Lagarde talked about having more sympathy with children in Nigeria than "the Greeks", she pointed at tax evasion in Greece, halving which would have plugged the deficits. Now Greece's chief tax controller told that she was right that tax evasion isn't confronted sufficiently, citing numbers that out of 5000 requests for looking into accounts which his authority made towards Greek banks, only 214 received a positive reply so far, and the others include 500 politicians. Now, does the latter concern "the Greeks", or the thin elite?... (BTW Varoufakis says that believing that solving the crisis with only a reform of tax collection is idiocy because the tax collection authority is cash-strapped too and wage cuts only increase corruption, but the above shows that tax authority corruption is not the only and maybe not even the chief problem.)

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Fri Jun 8th, 2012 at 03:10:49 AM EST
[ Parent ]
A SYRIZA victory will be taken by the Greek society and foreign investors in general as a default and an exit from the euro (the only way Tsipras has to make good on the largest part of his promises).

The two are not connected.

And fuck the foreign "investors."

As Michael Spence put it yesterday, under such scenario everything mobile will simply move away.

So stop it at the border. The only really mobile assets in Greece are the ships. Money can be repatriated retroactively.

The problem is that this will happen with the caretaker government still in place, before Tsipras is sworn in.

Can't. Takes time to dismantle factories. Particularly when the union picket has as many crowbars as the demolition crews.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Jun 8th, 2012 at 08:58:11 AM EST
[ Parent ]
This would be a good time for the Greeks - and everyone else - to read about what happened in Argentina after the IMF applied 'austerity' (i.e. financial terrorism.)

There were a couple of very bad years after the default, but there were also official worker takeovers of assets and factories, some severe debt write-offs, followed by a mini-boom - to the point where the Argentinian government offered to make good on some old debts voluntarily.

I continue to be baffled that the Troika are applying policies that have been shown not to work time and again.

The only possible conclusions are that the Trokia are led by intellectual dwarves, or their unofficial aim is to create chaos and unrest deliberately.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri Jun 8th, 2012 at 10:14:16 AM EST
[ Parent ]
No, one goal is to use the crisis to push for 'reform' (aka Naomi Klein's Shock Doctrine); another is to make an example out of Greece should any other victim think of straying from the austerity route.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Fri Jun 8th, 2012 at 11:22:59 AM EST
[ Parent ]
DoDo:
No, one goal is to use the crisis to push for 'reform

do you think the elite want a fiscal union? and that's the reform they're aiming for by beating up on greece?

we all know reform usually means lower taxes for the rich, the continued coddling of the major players, less regulations for health and safety, less welfare, pensions etc, but have 'they' also decided that we need the equivalent of the IRS, europe-wide?

even they pull that off, and i think a shock doctrine like we see now could act as a goad in this direction, it still leaves the giant unanswered question of what to do with the underground economies which would likely swell considerably under the austerian bootheel.

the only ways i can see to effect this would be to outlaw cash and make everything bancomat card based, or to set up draconian penalties for undeclared labour.

it will get surreal when they have to parse trading favours and gift giving, as no government will win voters sticking its nose so deep into citizens' everyday lives.

oh wait...

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Fri Jun 8th, 2012 at 11:51:21 AM EST
[ Parent ]
do you think the elite want a fiscal union?

I think parts of the political elite certainly want it, but on unacceptable terms: a fiscal union putting government budgets outside of democratic control. Another part want a "fiscal union" in scare quotes: the undemocratic centralised element without real integration.

<sub>*Lunatic*, n.
One whose delusions are out of fashion.
</sub>

by DoDo on Fri Jun 8th, 2012 at 02:41:50 PM EST
[ Parent ]
There is no treaty mechanism to eject Greece from the EMU. They could, of course, exit of their own volition, especially when that action would benefit core countries, but it remains their option. Neither is it clear how they could be forced out of the EU and SYRIZA has stated intentions to the contrary. As J. Edgar Hoover used to say: "The wish is father to the thought."

They could remain in both the EMU and the EU, default on debt generally or in a limited and specific manner; they could establish a New Drachma as their own Wörgl type currency for purely domestic use regardless of the actions of the ECB or the Commission; they could seize all assets that have been transferred under pressure and offer to compensate those claiming losses in New Drachma, which they could print for the purpose; and they could seek to seize all or parts of the wealth of Greek nationals held in Switzerland, Luxembourg, etc. The worst that likely would happen would be for others to sue Greece in appropriate fora, which could drag on for years while they were creating 'facts on the ground'.

Much of what is claimed that they would do is what other interested parties hope they will do; much of the rest is baseless scaremongering intended to frighten the Greek electorate into reelecting a coalition along the lines of those who got Greece into the crisis. Those governments and parties have amply demonstrated their willingness to hold Greece while the powerful from other nations repeatedly rape her.

Regardless of the elections, the situation will continue to deteriorate, given the course pursued by the Troika. But any recovery will be delayed until the Troika recommended policies are abandoned. Perhaps The Troika should build a money laundering machine through which they can run the money intended to make whole the feckless bankers who made loans they should have known could not be repaid. A good case can be made for most of those loans constituting fraudulent conveyance. But, in the end, there is no point in the Greek people formally agreeing to the doomed, destructive and stupid plans being foisted upon them by face saving European politicians serving incumbent financial interests.

By telling the creditors to go fuck themselves Greece would, in fact, be doing the citizens of rest of the EMU and EU a huge favor - all but those who hold the ownership of the unrepayable debts.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Jun 8th, 2012 at 01:53:32 PM EST
[ Parent ]
And a general financial meltdown of an order of magnitude larger than what happened with Lehman is highly likely, regardless of the outcome of the Greek elections or the actions of any Greek country. And this will be blamed on Greece anyway. But that event may so occupy the core countries that Greece will fade from the forefront of consciousness. The more autonomy Greece has at that time the better off she will be.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Jun 8th, 2012 at 01:57:26 PM EST
[ Parent ]
By narrative here I imply a rhetorical tool meant to frame the issues in Greece in such a way as to exclude certain kinds of questions and objections and invite only particular others. Though it is true that in one sense every depiction of events, especially of a procession of events, is a narrative of one form or another,what we have here is a narrative that does not even try to include the relevant facts, but rather to make them opaque, to misrepresent and deny coherently, and by plan.

This is an old technique, as old, at least, as the response by wealthy US elites to the threat to their interests posed by Henry George and his proposed single tax on the unimproved value of land in the late 19th Century, as described in Mason Gaffney's "Neo-classical Economics as a Stratagem Against Henry George, That elite, including J.P. Morgan, (Columbia), John D. Rockefeller, (University of Chicago, Leland Stanford, (Stanford), Ezra Cornell, (Cornell), and Johns Hopkins, (Johns Hopkins), responded by hiring professors for the new academic discipline of economics. These economists consciously recast the discipline so as to deprive George and the like minded of the ability to effectively quote the classical economists in criticism of the activities of the Gilded Age tycoons. Their choices of a foundation and method crippled the discipline, but the primary purpose of the discipline was as a PR facade for the wealthy and loss of analytic and predictive power was just a price to be paid.

The more importance an area or issue holds the greater the lengths to which elites will go to maintain their power and influence. I believe that the sad history of the origin of Neo-Classical Economics is paradigmatic of this process, a political variation of which we see unfolding in Europe, with Greece as the epicenter.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jun 7th, 2012 at 05:20:30 PM EST
in English, French, German and Greek :

Stand with the Greek Left for a Democratic Europe!

 Stand with the Greek Left for a Democratic Europe!

It is clear that the responsibility for the chain of events that in a mere three years has plunged Greece into the abyss lies overwhelmingly with the parties that have held office since 1974. New Democracy (the Right) and PASOK (the Socialists) have not only maintained the system of corruption and privilege -- they have benefitted from it and enabled Greece's suppliers and creditors to profit considerably from this system while the institutions of the European Community looked the other way. Under such conditions, it is astonishing that the leaders of Europe and the IMF, posing as paragons of virtue and economic rigor, should seek to restore those same bankrupt and discredited parties to office by denouncing the "red peril" supposedly represented by SYRIZA (the radical Left coalition) and by threatening to cut off food supplies if the new round of elections to be held on June 17 confirms the rejection of the "Memorandum" clearly expressed in the elections of 6 May. Not only does this intervention flagrantly contradict the most elementary democratic norms but it would have terrible consequences for our common future.



It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Sat Jun 9th, 2012 at 04:51:41 AM EST
The Troika are AFA. Arrogant fucking assholes. This is outrageous what is happening to Greece, and it makes me so angry. Thank you Talos for a great piece. Lets hope Syriza wins!


"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Sun Jun 10th, 2012 at 10:05:03 PM EST
^a SYRIZA government will be the only government in recent memory which will aggressively attempt to collect taxes from the rich... But we're entering a highly chaotic period and there are swarms of butterflies around of the sort that cause hurricanes afar... So, who knows?"

just great writing

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia

by whataboutbob on Sun Jun 10th, 2012 at 10:19:01 PM EST
[ Parent ]
Krugman on Asmussen: Another Bank Bailout (NY Times, June 10, 2012)
Meanwhile, senior officials are asserting that austerity and internal devaluation really would work if only people truly believed in their necessity.

Consider, for example, what Jörg Asmussen, the German representative on the European Central Bank's executive board, just said in Latvia, which has become the poster child for supposedly successful austerity. (It used to be Ireland, but the Irish economy keeps refusing to recover). "The key difference between, say, Latvia and Greece," Mr. Asmussen said, "lies in the degree of national ownership of the adjustment program -- not only by national policy-makers but also by the population itself."

Call it the Darth Vader approach to economic policy; Mr. Asmussen is in effect telling the Greeks, "I find your lack of faith disturbing."



If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Mon Jun 11th, 2012 at 06:55:25 AM EST
Asmussen's reasoning is Leninist at heart here: Austerity cannot fail, it can only be failed.

One would wish that he would limit himself to austerity in one country...

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 11th, 2012 at 08:19:53 AM EST
[ Parent ]
It's also reminiscent of medical quackery: it's not the treatment that is bonk, it's the patient that didn't follow it properly.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Mon Jun 11th, 2012 at 09:15:50 AM EST
[ Parent ]
In Soviet Europe, Austerity chooses you.
by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Jun 11th, 2012 at 09:49:39 AM EST
[ Parent ]
Athens News interviewed SYRIZA's economy expert (and potential finance minister) (`No unilateral action for Syriza,' says Yiannis Dragasakis: | Athens News). The reporter pressed him on what SYSRIZA will do in case of a confrontation. He diplomatically says that he doesn't expect a confrontation and thst the current situation is a lose-lose for the EU and Greece and SYRIZA wants a win-win soltion, but then adds:

...you are right to suggest that we should have suitable contingency plans for any eventuality in order not to be caught unawares. It's good to have such plans without publicising them too much.

So they do prepare for the eventuality, good.

For the case of a run on deposits, he says:

Our political position is that we don't seek unilateral action unless we are provoked. This means that if a situation arises for which we are not responsible, but one which jeopardises our national or social security, the government will not hesitate to take all necessary and feasible measures, even beyond the constraints of formal legitimacy. But this would imply that the other side is in breach of its statutory obligations. After all, financing the Greek banking system through the eurosystem is a paramount obligation of the ECB and national central banks which provide the liquidity necessary for eurozone economies to function properly. It's not some sort of charity that the ECB grants to eurozone states whenever it so pleases.

The "even beyond the constraints of formal legitimacy" sounds like a stark warning.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Mon Jun 11th, 2012 at 09:42:28 AM EST
Evil empire preparing, too: Exclusive: EU floats worst-case plans for Greek euro exit: sources (Reuters, Jun 11, 2012)
European finance officials have discussed as a worst-case scenario limiting the size of withdrawals from ATM machines, imposing border checks and introducing capital controls in at least Greece should Athens decide to leave the euro.

EU officials have told Reuters the ideas are part of a range of contingency plans. They emphasized that the discussions were merely about being prepared for any eventuality rather than planning for something they expect to happen - no one Reuters has spoken to expects Greece to leave the single currency area.

...

The discussions have taken place in conference calls over the past six weeks, as concerns have grown that a radical-left coalition, SYRIZA, may win the second election, increasing the risk that Greece could renege on its EU/IMF bailout and therefore move closer to abandoning the currency.

(h/t kcurie)

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Mon Jun 11th, 2012 at 11:58:29 AM EST
[ Parent ]
Athens News: Greece seek better terms after Spanish rescue (11 Jun 2012)
Greece can seek a better deal from Europe for its own rescue after Spain won lenient bailout terms, the main parties said on Monday, a sign that however Greece votes this week it will be headed for a showdown with Brussels.

...

Syriza, which has campaigned on a pledge to scrap the bailout altogether and demand better terms, said the Spanish deal proved that the austerity imposed by international lenders had failed.

...

Conservative leader Antonis Samaras said the Spanish deal was proof that Greece had more to gain by negotiating with its European partners than by falling out with them.

ROFL

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Mon Jun 11th, 2012 at 12:32:45 PM EST
[ Parent ]
How can anyone in their right mind claim that Syriza's position extreme/a threat/illogical is beyond me.

It might be riskier only because it will test the depth of stupidity that drives current European policy but other tha that it's a step in the right direction for both Greece and Europe.

Compare and contrast with what what Samaras is saying. That position is a bend-over-and-give-it-to-me-hard-master invitation.

by Euroliberal on Tue Jun 12th, 2012 at 05:10:58 AM EST
[ Parent ]
Captured mass media create inartful formulations such as this one:

http://www.bbc.co.uk/news/world-europe-18268089

But Syriza is finding surprising favour among Greeks who believe they have done nothing wrong and who now - as they see it - have little left to lose by standing up to Brussels and Berlin.

The head of the International Monetary Fund, Christine Lagarde, outraged many in Greece last week when she said that Greeks had been dodging tax for too long and living beyond their means.

Her point is indisputable in one sense. Successive Greek governments lied about the true extent of Greek borrowing and the size of the national deficit and debt mountain.

The country's profligacy has become a threat to the stability of the currency of all 17 member states who use it.

  1. Greeks who claim they have done nothing wrong are all voting for SYRIZA.

  2. Lagarde says that Greeks dodged taxes and lived beyond their means and the writer says this is indisputable because successive Greek gov'ts lied about the size of the national deficit and debt mountain. But, in point of fact, only one gov't lied: the Karamanlis gov't. And unless the figures showing Greece's 105% to 110% debt to GDP prior to the crisis are wrong, this writer is making unsubstantiated claims. If the figures prior to 2009 are wrong, then this must mean the debt mountain is much bigger than the current 165% debt to GDP, because the amount added to Greece's debt over the last 2 years is known, and it has taken them from the announced 115% to 165% (due to GDP contraction mostly). If indeed, the amount was higher than 110% or 115%, then the current debt to GDP is higher than 165%.

  3. How has Greece's so-called profligacy become a threat to the euro? How is this even possible?
by Upstate NY on Mon Jun 11th, 2012 at 10:10:37 AM EST
How has Greece's so-called profligacy become a threat to the euro? How is this even possible?

The stupid moralistic framing employed by Merkel, the Commission, the ECB and the IMF, that only serves the interests of the very wealthy has proved a boomerang and hit them all in the head, addling their brains even further. Thus, their repeated reactions of denial and avoidance of the core problem in Greece, Ireland, Portugal, Spain and Italy has spiraled out of control and now threatens the existence of the euro - a situation which they continue to deny. Hubris has become Nemesis.  

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Jun 11th, 2012 at 10:24:27 AM EST
[ Parent ]
How has Greece's so-called profligacy become a threat to the euro? How is this even possible?
The stupid moralistic framing employed by Merkel, the Commission, the ECB and the IMF, that only serves the interests of the very wealthy has proved a boomerang and hit them all in the head, addling their brains even further.
Paul de Grauwe: A self-inflicted crisis (Eurointelligence, 29.05.2012)
Even today the ECB does not seem to recognize this problem. As a result, its strategy has been to wait and see. Thus, last year it waited until the sovereign debt crisis had sufficiently damaged the banking system and risked leading to an implosion. Close to the precipice, it decided to act and to provide massive amounts of liquidity to banks that were a multiple of what would have been necessary had the ECB acted earlier. Today as the Eurozone is hanging over the precipice again, the ECB again is sitting on the sidelines and waits for worse to come.

...

The European Commission has shown an equal capacity of mismanaging the crisis. Pushed by the creditor nations and the panicky financial markets, it is forcing Eurozone countries to accelerate austerity measures in the midst of a recession.  As a result, the debt to GDP ratios increase as the denominator in this ratio is shrinking faster than the numerator. Countries end up with a higher debt burden, which triggers more panic reactions in the markets.

Again there is a failure to understand what is going on. The excess debt accumulation in the South is matched by an excess accumulation of claims in the North. The correct response would be to force the deficit countries to reduce and the surplus countries to increase spending. The European Commission's strategy, however, forces all the adjustment on the deficit countries without imposing a symmetric and opposite adjustment on the surplus countries. As a result, the Eurozone is forced into a deflationary straitjacket.  

De Grauwe chooses to resolve the incompetent or evil dilemma in the incompetence direction.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa
by Migeru (migeru at eurotrib dot com) on Mon Jun 11th, 2012 at 10:55:39 AM EST
[ Parent ]
The European Commission....is forcing Eurozone countries to accelerate austerity measures in the midst of a recession.  As a result, the debt to GDP ratios increase as the denominator in this ratio is shrinking faster than the numerator. Countries end up with a higher debt burden, which triggers more panic reactions in the markets.

They may have even read and understood Irving Fisher's Debt-Deflation Theory of Great Depressions but are under such control of the money/pleasure/status reward areas of their brains and in such fear and awe of the financial powers that be that they cannot but do their bidding regardless of how foolish they seem.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Jun 11th, 2012 at 12:17:57 PM EST
[ Parent ]
News bites @ 10 | Athens News
4. HEALTH CRISIS Health cutbacks and the crisis in the social insurance funds has deprived many severely ill patients of access to vital medications, patients told a press conference on Monday. According to Michalis Tsakantonis, an unemployed cancer patient who also suffers from diabetes and a weak heart, things are now so bad that he "just wants to die like a human being, where I sit". Unable to get a pension because he is short 99 days of work, Tsakantonis cannot afford to buy the drugs he needs or even to breathe properly, since the electricity company cut off his power and he can no longer operate the assisted-breathing device that he needs. "Our basic medication costs up to 1,000 euro a month, apart from the other drugs that we got for free. Now you have to begin a marathon in order to get one box of drugs and, as soon as you find them, you're filled with anxiety about whether you can get the next box," said the general secretary of the Greek society for MS patients Dimitra Kontogianni.


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue Jun 12th, 2012 at 04:31:21 AM EST
So, this morning on NPR (National Public Radio) in the USA, they interviewed an economist from the American College in Athens for all of 1 minute and 30 seconds, 3 quick questions. One, seek out unknown Greek economist from lesser known university: CHECK. Two, prepare leading questions which reinforce the dominant narrative, CHECK. Three, after parrot recites the dominant narrative, move on to entertainment news: CHECK.
by Upstate NY on Tue Jun 12th, 2012 at 08:36:52 AM EST
90 seconds. A lot of time to spend on such a dangerous subject.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Jun 12th, 2012 at 09:52:58 AM EST
[ Parent ]
Pasok's leader drops all pretenses and equates former core values with conservatism:

News bites @ 10 | Athens News

3. VENIZELOS IN PLEA The only solution for the country is a national government of shared responsibility, Pasok leader Evangelos Venizelos reiterated on Tuesday, in an interview with AMNA Web TV, adding that all pro-European powers should prove their stance by assuming a share of the responsibility. He said Pasok has assumed its responsibility for the unrealistic election campaign pledges made in 2009, charging that "the architects of those pledges now can be found in the ranks of Syriza", which he described as a "conservative force", one embracing "statism and trade unionism".


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Jun 13th, 2012 at 04:39:25 AM EST
Alexis Tsipras has an Op-Ed in the FT today - (Subscription wall, full text here). Among other things he repeats his party's intention of keeping Greece in the Eurozone, and pledges to increase tax revenues by 1% every year for the next 4 years.

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Wed Jun 13th, 2012 at 04:59:10 AM EST


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