Posted on 06/17/2011 3:18:39 PM PDT by DeaconBenjamin
Just last year Europe’s politicians set up a euro-rescue organisation that has done very well since then. It began with loans of 110 billion euros for Greece. Then came billions in bailouts for Ireland and Portugal. Now Greece is back in the line-up.
The politicians have flouted the harsh prohibition against solidarity in the EU Treaty [“The Union is not liable for the debts of the central governments.”], claiming that a kind of emergency is afoot. Emergency aid, indeed, is permitted if a country has been swamped by a natural disaster. The fact that Greece’s public debt now stands at almost 150 percent of the gross national product – a situation that was brought about by politicians (i.e. people) – now counts in the EU as a kind of natural destiny.
International treaties also prohibit the IMF and the ECB from such billion-dollar bailouts. The ECB’s buying up of government bonds on the so-called secondary market – that is, from creditor banks – is smoke and mirrors. The parlour trick has turned them into the biggest creditor of the Greeks, truly a “bad bank”. Economist Roland Vaubel calls it the “most obvious breach of law in the history of European integration.” Damage to the rule of law is at least as grave a matter as a creeping erosion of democracy. Upstanding Europeans have sunk to the level of bribers and blackmailers
The autonomy of Greek politicians has been dead, de facto, for the past year. Their freedom of choice was exhausted when they had to decide which to sell first, the port of Piraeus or the port of Thessaloniki. Athens can now choose whether it prefers to cut civil service salaries by ten percent and civil servants’ pensions by 20, or vice versa. Preferably, it will go for both. “The Bundestag is setting conditions for Greece,” newspapers headlined recently, just as if it were a German “protectorate” (writes Rainer Brüderle).
“In exchange for money, Greece has gone into serfdom for the EU,” says economist Vaubel. “Like in the Middle Ages.” That country, where democracy was invented, has let democracy be bought up by supposed rescuers who act as liquidators. The path to the EU transfer union leads around the castrated body of democracy.
From the viewpoint of the donors, the billions in loans being offered at preferential interest rates are a form of bribery – the price the EU is paying to protect French and German banks. From the viewpoint at the receiving end, the Greeks are behaving like extortionists, demanding sweeter and sweeter credit terms as a condition for keeping the creditor nations and their banks from going bust. Upstanding Europeans have sunk to the level of bribers and blackmailers. Last hope rests with the Federal Constitutional Court
This sort of solidarity is damaging the parliaments of Europe. In a Brussels night-and-fog operation on 9 May 2010, Europe’s politicians, led by France’s Nicolas Sarkozy and prompted by France’s Jean-Claude Trichet, came to a deal on that EFSF (European Financial Stability Facility) rescue package that should soon be blessed with eternal life under the new acronym of ‘ESM’ (European Stabilisation Mechanism). The German government continues to press a gun to the head of Germany’s parliamentarians and to wrestle them into going along with the plan by threatening that, should they balk at it, anonymous markets will go berserk (“Lehman, Lehman, Lehman”). In that dire case, the government warns, disaster (“Domino Effect”) will follow hard and fast.
Where there are losers (democracy, the rule of law and the citizens), there are winners too. The winners are the centralisers. The economist Vaubel calls these “Euromantics”. The writer Hans Magnus Enzensberger speaks of “monsters”: guardians of the citizenry who, with a great moral cudgel in their hands, impugn all those who warn of the cost of the transfer union as sinister chauvinists and indifferent accomplices to a disintegrating Europe. The left-wing intellectual elites (from Jürgen Habermas to Joschka Fischer) leap to the flanks of the Euromantic political elites, warning of the evils of “re-nationalisation” – not realising that they, with their emotive ‘solidarity’, are the actual agents of finance capital, i.e. the private banks. For politicians and intellectuals, it’s not really about ‘solidarity’ here. It’s about gaining power and winning the public opinion battle at the expense of the freedom of the citizenry. Centralisers of all political and ideological stripes – lurking under cryptic but expensive acronyms (EFSF, ESM) – always sap competitiveness, erode democratic controls and hinder understanding among peoples.
The strong feelings aroused as never before in people of all educational levels by the once boring topic of Europe is a sign that people are aware that something big is at stake here. So long as confidence in the markets since the start of the financial crisis remains shaky, the last hope rests with the Federal Constitutional Court. On 5 July, Europe is on the table in Karlsruhe.
Nonsense. Greece dug its own hole, voting repeatedly for extreme left-wing governments and basically refusing to work for a living. Then when it’s time to pull up their socks, they go out in the streets and riot.
Why should the Germans pay so the Greeks can retire about ten years earlier than Germans do?
The international debt and banking Ponzi scheme continues, and will continue for as long as the banksters are able to milk and get away with it. And, "too-big-to-fail" financial organizations also made incredibly large and foolish bets when they sold credit default swaps to essentially insure now-bad bonds from bankrupt countries. Of course, there is no requirement for banks and others to disclose their off-balance-sheet CDS exposures.
This would go nuclear if the CDS's actually have to be paid out as a result of the Greek bond defaults. Now, the lawyers are splitting hairs so that they can redefine what a bond "default" is.... The courts, under government & banking & political pressure, will try to say that a failure to return capital on bonds - via a forced bond term extension - is not a CDS-triggering default. In other words, those who sold and profited from the CDS contracts (made naked losing bets) will be protected and allowed to default on paying on the CDS contracts.
The stinking rot of the financial system is starting to expose its deep and structural inadequacies and stench. Let's see how long they - with help from bought-and-paid-for politicians , can continue to paper over/put a happy face and sweet smell on all of this crap.
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