Grecian Formula (20)16

The news says Greece has voted against Euro-Austerity. Forecasters are suggesting there will be a stern “it’s just business” reaction by the bankster community, so they will insist Greece get out of the EU, and then they shall recruit all lenders to apply every economic pressure upon Greece with ‘extreme prejudice’ . They hope to embarrass the Greek leadership while maximizing the misery of Greek citizens. Most American commentators I read say there will be almost no ripple effect felt by the American economy.

Today, in a comment by Lisa over at Ian Welsh’s blog, I read of a possible consequence that never crossed my mind: coup d’etat.

On the one hand, it does not make much sense. The governing party will be under tremendous pressure to ease the already awful economic pain Greece suffers and the odds in favor of succeeding are long. Unless the nation finds a way to sacrifice and rebuild on its own, the Greek people are very likely to boot their government out. Given the debt load, this might happen to one or more succeeding governments. With that in mind, agents who might otherwise contemplate a violent short-cut may be better off biding their time.

Lisa was one of the commenters who alluded to the history of regime change. While I have believed all along that Greece was going to vote “no” because of national or cultural pride, I had not considered that the 1% have their pride too— the pride of possession, nine-tenths of the law.

In their view, they are entitled assert dominion. They will feel entitled to make an example of Greece. It would relatively painless since they are such a small portion of the EU. Better to start small. It would be useful to show Ireland, Portugal, Spain or even the larger Italy how the Euro will not accept shirkers of such “solemn” fiduciary obligations. It must be made plain that orderly cash flow is the grease of international relations. Made plain at all costs. Equally, the banksters are entitled to orderly profits and cannot be asked to wait in line.

Loan-sharks need leg-breakers and legs to break. America has displayed such ruthlessness as a regular feature of its history. I see no reason why the old empires of Europe and their banks should feel any differently.

Lisa may be pointing to an unlikely prospect, but we should be watching for signs. The trends in trade policy, in security spending, and in the increasing allocation of wealth into the hands wealth of the 1% all point in the same direction. The prescription has been written by the Greek people in 2015. Perhaps it is a formula for success and recovery.  In about six months we should know. We can hope.

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  • An Update of sorts:
    I was reading an article at Huffington Post by Robert Kuttner today called “Just Say No”. In it he reports this:

    To put the Greek crisis in context, consider the debt relief and credit support given to post-Nazi Germany by the Allies, who wrote off 93 percent of the Nazi era debt in the early 1950s and stretched out the pre-Nazi debt incurred during World War I and the Weimar period well into the 21st century.

    So what about this path? Let Germany forego what it owes in war debt in exchange for an equal amount lent to Greece with a pay-back period equal to the deal Germany got? I have no idea what that really amounts to in Euros or time, but it might be a place to start the dialogue.

    • Although the Greece rhetoric is very much purporting this deceiving notion, the EU nor Euro group is run by Germany. The German stance is almost moderate in comparison to the Spanish, Polish or Finnish governments.

  • This is very much misreading the situations.

    The banksters have no game in the skin any more. In the first Greece bailout the debt was conveniently passed on to the other EU nations states. Those wealthier EU state have now the problem that their electorate has no appetite for deb forgiveness, especially not the the East European ones were the living standard is actually lower than in Greece.

    At this point this crisis is about an ill conceived currency union, the 99% versus 1% narrative does not fit.

    • Quax-
      If Germany’s views are moderate compared to Spain, Poland and Finland, I haven’t seen anything in the media about it. (I’d appreciate your help in locating some sources and commentary–I don’t doubt you, I just haven’t located any on my own.) It seems all US coverage is directs attention to Germany and to France. I was surprised yesterday to hear NPR or BBC play a recording of the Irish finance minister saying Greece should buckle down and copy what Ireland did during its financial restructuring. Other than the 15 second sound byte, I have not seen anybody else get much air time.

      As to whether the Euro makes sense as an organizing principle for Europe, I do read several sources that come to your conclusion. That said, I am not sure that necessarily excludes or even minimizes the role of banksters. Then again, I may just be turning into a democratic socialist !

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