Spinners misread the Greek elections

 

          We are invited to believe that the Greek election is between a couple of old parties, the political establishment, who “wisely” wish Greece to stay in the Euro, and some wild new parties who wish to be “irresponsible” and leave the currency.

          The problem with this view is that all parties in Greece, and most Greek people, want to stay in the Euro. The argument is not, unfortunately, about an orderly withdrawal. The argument is over the terms of staying in.

         The old parties have shifted their position. They moved from saying Greece has to stick to the deal, to saying they want to make some improvements for Greece. The EU spinners obligingly let it be know that these reliable parties would probably be offered a sweetener on victory.  The new parties, full of anger and strong rhetoric, have also during the campaign moved their position. Syriza has toned it down a bit, and conceded that Greece does need some austerity, and needs to negotiate a new settlement.

           The week-end press was briefed to warn of a firestorm if the challenger parties won. Mrs Merkel, meanwhile, has indicated there will be no renegotiation even for the “reliable” establishment, let alone for the tearaways.

             The future of the Euro and the future of Greece in the Euro remains poised, as always. It all depends on the whether the Euro area digs in and allows no change to the deal or not. They are discussing when they bow to the inevitable, not how to keep Greece in as a happy and compliant member. That latter is not an option from any Greek government. Greece. after all, recently reneged on on a lot of her debt. That was under the old “reliable” parties who said they were delivering the loan agreement which was said to save Greece.

          The inconclusive nature of the election result is not surprising. If the old parties do in the end have a majority, this will be spun as a victory for the Euro, but it solves none of the outstanding problems. It still leaves Greece struggling to hit any of the targets for the loans.  The people cannot see a sensible choice to back with a firm mandate. The political parties all want to stay in the Euro, so that means they all end up offering a variant of the same policy! The Euro is destroying democracy, as some of us predicted. No serious party in Greece has told the electors the truth, that the Euro is not right for them. They are all trying to stay in a scheme which does not work. The only differences are the severity of the rhetoric about possible easing of the immediate pain of the loan terms that the Euro has forced upon them.

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53 Comments

  1. lifelogic
    Posted June 18, 2012 at 5:25 am | Permalink

    Precisely needless to say the BBC spin has been straight down the EU line. Democracy, such as was left, is further destroyed.

    Meanwhile in France the “tax borrow and waste” socialists have taken over fully it seems. So a similar approach to Cameron’s there too now.

    • lifelogic
      Posted June 18, 2012 at 7:00 am | Permalink

      This is the link to the interesting Guardian interview with (ex I assume) BBC favourite James Lovelock of the Gaia religion fame – now that even he is finally grasping scientific reality good for him – but will he be defrocked for it?

      James Lovelock: The UK should be going mad for fracking

      http://www.guardian.co.uk/environment/2012/jun/15/james-lovelock-interview-gaia-theory

      • stred
        Posted June 18, 2012 at 11:34 am | Permalink

        I think, being a good scientist, Lovelock is just adapting as more detail comes to light. He is now saying that nuclear is not a realistic option in the UK because of green misunderstanding/religion being so strong after the latest non fatal accident. His previous work on greenhouse gases still hold. Anyone unable to understand how such a small proportion of a gas could be so effective should contemplate the fact that a few atoms in the surface of K glass can give a double glazed single panel door a higher insulation than a 44mm timber door.

        He backs shale gas because methane has a quarter of the co2 output of coal. This must mean that carbon capture muct be a complete waste of effort, as twice as much coal burning is necessary to run the capture plus generation, making shale 8 times more effective.

        While shale gives a 30+ year respite and, in some sensible part of the world, engineers will get on with developing very safe and plentiful thorium reactors. Our children may then decide to order these, when they are freezing in an island no longer warmed by the Gulf Stream and the decision to depend on windmills in the sea is seen as our greatest folly. We will not have to worry as we will be really warm in Hell.

      • uanime5
        Posted June 18, 2012 at 2:33 pm | Permalink

        I found an interesting paragraph in that article:

        He [Lovelock] displays equal disdain for those who do not accept science on climate change: “They’ve got their own religion. They believe that the world was right before these damn people [the greens] came along and want to go back to where we were 20 years ago. That’s also silly in its own way.”

        It seems Lovelock still says climate change is real and those who deny this are wrong.

        • lifelogic
          Posted June 18, 2012 at 5:13 pm | Permalink

          Well no one sensible denies that the climate changes or even that CO2 concentrations have some effect on it – do they?
          Countless other variables and feedbacks do too. It is the absurd exaggerations, scare stories, absurd tv evangelism that are disputed. Also the suggestion that wind, PV, tidal, wave, cycling, electric cars, hybrids, public transport and the likes can ever do anything much to help. Self evidently they can make virtually no difference, just look at the numbers.

          Anyway much evidence suggests a little hotter is better on balance anyway.

          Any money is far better spent on the many things that have a proven results. Like clean water, maternity care, malaria, inoculations, basic and nutrition.

          • stred
            Posted June 19, 2012 at 11:59 am | Permalink

            The Sunday Telegraph reported that 4x as many electric charging points, paid from taxes, had been built as electric cars sold- even with a 25% subsidy. Perhaps this is because anyone thinking of buying one is thinking twice when confronted with the selling price and the fact that a new battery costing £3k will be needed after 8 years. When the manufacture of the replacement is taken into account, the CO2 rating will be above that of an efficient diesel. They work in France though, unless the new Pres manages to close down their nukes.

          • uanime5
            Posted June 19, 2012 at 2:43 pm | Permalink

            Who exactly will benefit from it being hotter? Not the people in Africa who are suffering from increased desertification and crop failure.

          • lifelogic
            Posted June 21, 2012 at 3:14 am | Permalink

            @uanime5

            Hotter means more evaporation and more precipitation in general not less. On balance it should be better for crops.

        • Richard
          Posted June 18, 2012 at 8:57 pm | Permalink

          Who would deny the climate changes?
          Plainly it changes all the time and has changed dramatically from the beginning of time.
          Moving down and up in average temperature over the centuries.
          The debate is about what causes the changes.
          Best to keep an open mind.

          • uanime5
            Posted June 19, 2012 at 2:41 pm | Permalink

            According to the latest scientific evidence the average global temperature has been rising due to man made CO2.

            Best not to be closed minded and ignore what is inconvenient.

        • libertarian
          Posted June 18, 2012 at 9:22 pm | Permalink

          There isn’t a single sane person on the planet that denies that the climate changes. It has swung wildly between ice age and tropical multiple times in the 5 billion year life of the Earth.

          Its just not getting any warmer ( as predicted wrongly) its not being caused by man made Co2 ( as predicted wrongly) and it doesn’t require severe intervention ( as predicted wrongly)

          • uanime5
            Posted June 19, 2012 at 2:40 pm | Permalink

            Wrong on all 3 counts. The scientific evidence clearly shows that the average temperature has been rising because of man made CO2 and it will require intervention to reduce it.

          • libertarian
            Posted June 19, 2012 at 9:52 pm | Permalink

            Show me a link to this evidence you claim.

            The latest IPCC report admits there has been no significant warming in global temperatures since 1998.

            There is not one shred of evidence for AGW only a hypothesis. If you have EVIDENCE please show us.

            If its not happening which even the Green movement currently admits then it logically doesn’t require intervention.

          • lifelogic
            Posted June 21, 2012 at 3:21 am | Permalink

            @uanime5

            There has been no statistically significant warming for 12 years despite the increases in c02 concentrations. The evidence of temperatures in the upper atmosphere levels also do not support the wild predictions of the c02 doom mungers and tv evangelists.

    • lifelogic
      Posted June 18, 2012 at 3:21 pm | Permalink

      Spanish 10 year bond yields over 7% now – confidence did not last very long, despite the BBC’s best efforts.

      • zorro
        Posted June 18, 2012 at 4:39 pm | Permalink

        Second bailout beckons…..

        Zorro

  2. ian wragg
    Posted June 18, 2012 at 6:00 am | Permalink

    words left out-ed
    I fear civil strife of a great magnitude in Greece and would not be suprised if a “Euro” contingent of peacekeepers was sent in to quell the violence.
    Anything to preserve Germen hegemony.

  3. norman
    Posted June 18, 2012 at 6:02 am | Permalink

    Austerity – spending 20% more than your income as opposed to 25%. Even Mr Micawber knew where that road leads.

    You can’t blame the Greeks for wanting to stay in the Euro. If I was Greek I daresay I’d want to.

    It’s easy to say decouple and default but what politician wants to tell voters their salary will buy 30% less goods next week, that their house is worth 30% less, savings, pension… etc.

    That this has to happen in undeniable but like us in the UK – where we’re desperately trying to stave off the day of reckoning by printing ever larger sums – there is no appetite either from the electorate or from the political classes to take the necessary steps.

    • lifelogic
      Posted June 18, 2012 at 7:57 am | Permalink

      Their houses are worth what they are worth they would not be devalued any more than a lump of silver would be by a currency change. It is supply and demand, be it in euros or any other currency of exchange. What would happens to the mortgage is another question however. Clearly they will need to take a pay cut in euro terms one way or another those that still have jobs that is.

  4. Mike Stallard
    Posted June 18, 2012 at 6:51 am | Permalink

    OK so you are (as so often) correct in your analysis.

    But Greeks, like us, are human.
    What they want is a return to the good old days when they were rich, European and happy. They do not want the present to be happening.

    Our own politicians are doing exactly the same thing. Ed Balls wants us to get rid of the cuts and to inject some money into the economy so that (he doesn’t say this) we can go back to 1997. That’s OK. He wants to get back into power.
    What is truly shocking is that George Osborne is doing exactly the same thing under clouds of clever words! He, too, is “injecting stimulus into the economy” and borrowing much more than Gordon Brown – and still doing the utterly disastrous QE.

    So let’s admit it – we are being ruined by a Conservative Government!

    PS QE doesn’t work immediately it is like a reverse investment – it takes some time to pay back its bitter fruit.

    • alan jutson
      Posted June 18, 2012 at 1:09 pm | Permalink

      Mike

      Yes, its a mind blowing policy.

      Only real difference is Mr Balls thinks spending and borrowing should be even higher !

      One day they moan about the Pasty tax, next they talk about printing £140 Billion as if it were no problem.

      Difficult to comprehend how their minds work.

  5. Brian Tomkinson
    Posted June 18, 2012 at 7:39 am | Permalink

    JR: “The Euro is destroying democracy, as some of us predicted.”
    Yes and that is all part of the “project”. By the way what about democracy here in the UK? Powers given away by our own MPs, without recourse to their electorate, to an unelected cadre, and not one party willing to even offer an in/out referendum for fear they might lose and then what would their bosses in Brussels say?

    • lifelogic
      Posted June 18, 2012 at 5:21 pm | Permalink

      Libdems will gave you a pointless one on AV and want to on the House of Lord reform – just not anything that does not suit them.

  6. AJAX
    Posted June 18, 2012 at 7:48 am | Permalink

    Predictably the Eurocratocracy has re-established flimsy control of the parliament of an economic shambles for a little while longer – big deal.

    When the Greeks beyond its front portal fully realize that the EU supplied credit card they’ve lived off for the last 2 decades has gone they’ll turn on their would be masters

    Money buys obedience but not loyalty

  7. Lord Blagger
    Posted June 18, 2012 at 7:50 am | Permalink

    Spot the difference between the Nigerian scammer asking for more money from a mark and the Greeks asking for more money from the EU. There is none.

    The Greek strategy is simple.

    Keep up with the bad things will happen unless you hand over the cash. Keep this up until the payments stop and then default.

    Meanwhile, we’ve got the lies and the silence in the UK over UK debts.

    Still waiting John for you to fulfil your campaign promise and tell us what the black hole is in the state pension system. How much debt have you hidden off the books.

    • lifelogic
      Posted June 18, 2012 at 8:07 pm | Permalink

      This is certainly the sensible strategy for the Greeks as you say:

      Keep up with the “bad things will happen unless you hand over the cash”. Keep this up until the payments stop and then default. No point in defaulting until the bail outs dry up.

  8. Electro-Kevin
    Posted June 18, 2012 at 8:23 am | Permalink

    Some of the reports coming from the streets make for a disturbing read.

    Whenever I visited Athens I always felt it to be a backward place. How could this country ever have been compatible with Germany and France ?

  9. stred
    Posted June 18, 2012 at 9:14 am | Permalink

    While recovering from my holiday, I watched RT’s Kaiser? talk show and a Greek professor from Seattle discussed his new book about the crisis there. He was an ex- colleague of the present ex banker PM put in by the EU when the previous one suggested a referendum. The prof. described him as one of the worst bankers involved in the Lehman saga. Another interesting fact? was that the previous bailout was supposed to allow 80% repayment of loan and 20% for paying for thing like hospitals and wages. Wheras it had all been repaid to the ECB to pay off the losses on previous bonds. This may well be the position of the UK in the future if borrowin continues to be 4x the Greek level per head of population.

  10. sm
    Posted June 18, 2012 at 9:51 am | Permalink

    On a recent Sky report, a German worker(Street Cleaner) who suggested having the Deutchmark back was described as having an extreme view. I am not so sure it is an extreme view.

    Never mind rhetoric , what happens when the money does not arrive quick enough to pay the bills? Removing minimal survival safety nets will not work. Next country, next stop.

  11. Denis Cooper
    Posted June 18, 2012 at 10:08 am | Permalink

    I’ve always said the eurocrats would do everything they possibly could, ethical and unethical, legal and illegal, to preserve the eurozone intact.

    I don’t think we can even assume that the numbers of votes declared in the Greek election are the true numbers of valid votes that were cast.

    As for the attitude of the British government, the extent to which eurofederalists have resumed control of the Tory party becomes clearer by the day.

    Some time soon this Bill, the European Union (Approval of Treaty Amendment Decision) Bill:

    http://services.parliament.uk/bills/2012-13/europeanunionapprovaloftreatyamendmentdecision.html

    will complete its passage through the Lords and be passed to the Commons, where any MP who objects to it will be reminded that both Houses of Parliament pre-authorised Cameron to agree to that EU treaty change.

    As Lord Howell put it last Wednesday, Column 1354 here:

    http://www.publications.parliament.uk/pa/ld201213/ldhansrd/text/120613-0001.htm

    “the Prime Minister would not fulfil a commitment that he made at the March 2011 European Council – a commitment that was made after both Houses voted in favour of a Motion to approve the draft decision.”

    I said at the time that, whether or not they realised it, the Tory MPs who voted for that Motion in the deferred division held on March 23rd 2011, Budget Day, had just voted for the UK to eventually join the euro, and I still believe that to be the case.

    I’m glad to say that JR was one of the 29 MPs who voted against that Motion:

    http://www.publications.parliament.uk/pa/cm201011/cmhansrd/cm110323/debtext/110323-0004.htm

    but he’ll still be reminded that 310 voted for it.

  12. oldtimer
    Posted June 18, 2012 at 10:52 am | Permalink

    I thought that Mr Nelbandian gave us a good demonstration of the consequences of kicking the can at the Queens Club final yesterday.

    • lifelogic
      Posted June 19, 2012 at 7:14 am | Permalink

      Mr Nelbandian’s treatment seemed rather bit harsh to me. He clearly just kicked the board and did not intent it to beak and injure the linesman. Reports of police investigations are absurd, have they not got something more useful to do?

  13. Leslie Singleton
    Posted June 18, 2012 at 11:17 am | Permalink

    We should hear more about the 75% already reneged upon (so much easier to talk euphemistically about haircuts!). When the Greek politicians who just won, and so are now upbeat, talk about Greece “meeting its obligations”, whilst at the same time seeking to renegotiate even the reduced last lot, I cannot understand how they can say it with a straight face. And we wouldn’t even be where we are (wherever that is) without the additional 50 votes to the winner. Surely it is about time we had a Directive from the Big Swinging You Know Whats in Brussels telling Greece indeed all of us (only a matter of time if they have their way) how to vote properly or perhaps not yet whilst the result is the way they want–a few percent the other way, that’s all, however and it would have been the Antis who would have had the extra 50 seats. That so much in Europe as a whole should depend on so few in Greece alone is ridiculous.

    • lifelogic
      Posted June 19, 2012 at 2:56 pm | Permalink

      Yes “haircuts” sound quite pleasant, perhaps “limb amputations” might be a better euphemism from the lenders viewpoint.

  14. Paul Danon
    Posted June 18, 2012 at 11:22 am | Permalink

    For as long as Greece is in the union, it’s in the euro. There’s no way out of the currency except through withdrawal from the EU. The treaty-obligations between Greece and the other nations in the union and in the eurozone work both ways. The problem is thus systemic to the currency and to the EU. The union needs a new treaty on political (and consequently fiscal) union which will create a federal republic of Europe along German lines. National electorates need then to be consulted on whether they want to join the federation or leave the EU, perhaps for EFTA or for a global role.

  15. alan jutson
    Posted June 18, 2012 at 1:16 pm | Permalink

    I guess we could be back to square one again, with no one able to form a Government.

    What do they do then, hold another election, or does the EU take control.

    I can perfectly understand why the Greeks are angry, very angry.
    They did not get the government into debt, although they did withold a percentage of their taxes (which does njot help) but even then, if the politicians had in place a system where they only ever spent in any one year, 80% of what they received in taxes from the previous year, then they would not be in that position.

    Once again we have politicians spending more and more each year, and calculation with pie in the sky figures used for future tax receipts, based on future growth, none of which is guaranteed, or ever can be.

  16. PaulDirac
    Posted June 18, 2012 at 1:35 pm | Permalink

    About the nature of the EU elite
    If you ever read the history of WWI and perhaps have visited the killing fields in northern France and Belgium, if perhaps you visited a cemetery where the dead lie in endless rows, you would be forgiven if you cried silently for the millions of dead young people wasted in that five year pointless conflict.
    When I saw and read some of the WWI literature, I was amazed and impressed by the complete chasm between the elite, the leaders (monarchies, politicians, and military leaders) and the led, now lying in lines marching towards the horizon.
    How was it possible, I mused, that the generals on all sides would use their own people in such criminally casual way, throwing them into pointless battles, with scant regard to the massive human casualties, the carnage by gas, machine gun, cannon and bayonet?
    Moving small “brigades” on their scale maps, mainly secure from the rigors of the front line, a few tens of miles away.

    We now move about a century on and look at the present day “generals” who led us to the current economical disaster in Europe:
    The French President Mitterrand, commission president Delors, the German chancellor Kohl, add to those the current main players Barroso, Van Rompuy and others.

    They are the new elite.
    They come to your living room TV and tell you how they will run your life better than you could yourself, meanwhile entrenching themselves into better positions, becoming millionaires (look at the Kinnocks).

    These are the new generals who point Europe towards financial doom; they already sent the four horsemen of the apocalypse in a great arc from Greece through Italy Portugal and Ireland.
    Famine- check, Conquest – check, Death – check, War – perhaps to come.

    Following generations will read their history books and wonder how Europe fell for their siren song, their false prophesy of growth and prosperity for all, while they were playing the same elite games of yesteryear, a complex sort of chess with real humans in the millions as pawns

    • uanime5
      Posted June 19, 2012 at 2:53 pm | Permalink

      If you’d studied military strategies from the 19th century you’d know exactly why these general adopted the strategies they did during WW1; because guns that could fire multiple times or rapidly didn’t exist during most of these battles. Napoleon was well know for ordering his soldiers to charge at enemy gunmen and achieved a high rate of success because the enemy soldiers could only fire in volleys.

      Your comparisons of WW1 military strategies to the EU is factually wrong if not outright farcical.

      • libertarian
        Posted June 19, 2012 at 10:05 pm | Permalink

        Apart from the “pickle gun” invented in 1718, The Agar 1861 the first truly heavy machine gun and used in the US Civil War as was the even more widely used Gatling gun. The first “self powered” heavy machine gun the maxim was deployed in 1885. The Maxim and similar derivatives were produced and deployed in large numbers by both sides right from the start of WW1 as was the new and more potent Vickers machine gun.

        Oh and the Napoleonic Wars were in the EIGHTEENTH ( 18th) century not 19th and WW1 was in the 20th century

      • zorro
        Posted June 20, 2012 at 8:32 pm | Permalink

        uanime5, Haha….like you’ve obviously (not) studied WW1 military strategy/napoleonic strategy……perhaps you could enlighten us with the tactical advantages of advancing in “l’ordre mixte” ….. Or how British redcoats were able to maintain greater fire power than French line regiments. Perhaps you could explain Napoleon’s tactical reasons for abandoning the Pratzen Heights, or why Napoleon ordered D’Erlon’s corps against Picton when he did instead of advancing straight up the old Roman road?

        The Napoleonic war period covered essentially from 1794 after the Terror ended, and Napoleon slowly became more influential through the Directory until 1815 when the ‘Corsican ogre’ was finally beaten by ‘Old Hookey’. So it straddles 18/19th century.

        Zorro

  17. peter
    Posted June 18, 2012 at 1:41 pm | Permalink

    Oh well – it looks like the markets will ultimately doom the Euro because the whole thing has been built wrong.

    I cant see 20 countries with different cultures and systems merging their banking and financial systems the next 6 months so I fear none of this is going to end well.

    George Osborne needs to stop ‘lending’ billions to the IMF that he is not going to get back and concentrate on getting trade going around the world and give us the IN/OUT EU referendum.

  18. Bert Young
    Posted June 18, 2012 at 1:54 pm | Permalink

    Of course Greece wants to stay in the Euro – they believe , as long as they do so , that some EZ designed solution will enable them to continue as they were before . Rather than face up to an uncertain future with a new Drachma , they would rather cheat away within a system that has few , if any , effective controls . The sun shines away any approach to hard work there just as it does in all the Southern Europe area . Growth is not on their menu .

  19. Backwoodsman
    Posted June 18, 2012 at 2:25 pm | Permalink

    Austerity is a difficult message to sell in a democracy,especially to generations who have been
    privileged and indulged in a way that their predecessors would have found astonishing,and who,in many cases lack any real self-restraint or self-discipline.
    It might help a little if the elites led by example.Instead they are so mired in greed and corruption,and so short-sighted that they lack moral authority when they preach to others a message that so clearly is not intended to apply to themselves.
    This is generally true,and not just of Greece or Europe.It will destroy democracy as such if things continue as they are.
    Those who have vision and integrity, and who might effect genuine renewal,such as yourself,have been marginalised.There seems to be no shortage of perceptive analysts,but they are not those who are taking the decisions.Why and how has this disjunction occurred?It really seems to be very common in Western and quasi-western societies.

  20. uanime5
    Posted June 18, 2012 at 2:26 pm | Permalink

    Given that the Greeks had the opportunity to vote against austerity and the euro it’s clear that neither is destroying democracy. The Greek people made their choice regarding the future of their country.

    The political parties want to stay in the euro because the Greek people want to remain in the euro. It seems that the Greeks consider the euro right for them.

    • zorro
      Posted June 18, 2012 at 4:42 pm | Permalink

      Yeah but somehow I don’t think they will take the Euro medicine prescribed…….They still have some cards to play with the Germans, and Germans I know are not good poker players.

      Zorro

    • Lindsay McDougall
      Posted June 18, 2012 at 10:10 pm | Permalink

      The worst thing about Greek debt is not that it is at 165% of GDP but that it is increasing rapidly and nobody seems to know how to stop the rot. The wholesale privatisations planned should help. Some public expenditure cuts, including military expenditure, should help. Getting everybody to pay their taxes so that rates can be cut would help. And allowing your currency to float (sink) would help, but for that Greece would need to leave the Euro.

      For some reason the Greeks want to stay in the Euro zone. Perhaps if they hear the word ‘Nein’ often enough they will change their minds.

  21. Acorn
    Posted June 18, 2012 at 4:47 pm | Permalink

    Betwixt and between, I don’t know. Who would want to be a teenager nowadays, what future do they have? I think we can definitively say, that all economists are fakers; carpetbaggers. All economic theories are fiction.

    Those of you who have read Uncle Tim http://www.tullettprebon.com/announcements/strategyinsights/notes/2010/SIN20120611.pdf ; will know that it is some sort of dark-side force that is hiding the UK economic metrics from the vultures currently circling over Greece and Spain. Perhaps it is our large position in the international trade in financial assets that is keeping us up there with the dollar and the yen. Who knows? Keep praying that the “markets” concentrate on the Eurozone and not the UK.

    On the other side of the economist fence, the MMT guys say the sovereign currency governments, should be spending new money into the household and non-financial corporate sectors; to create growth. But; the UK has reduced public spending by a bit and increased taxes by some what more. Does this mean the government is actually spending to compensate for a private sector spending decline, George won’t tell me. (I am assuming that GO knows what he is doing, but I am open to argument on this bit).

    The New York Fed wonks are saying that when central banks set interest rates around zero, the macro-equations change their nature. To boost growth in such conditions, you need to cut sales taxes – VAT in our case – and; increase the governments role as “the spender of first resort”, not BoE lending. That is, spend new money into projects that will later produce a positive return: AND, do not substitute for stuff the private sector is perfectly capable of supplying on its own.

    Hope you had a great birthday JR, I wish you all the best.

  22. Monty
    Posted June 18, 2012 at 7:20 pm | Permalink

    Norman:
    “It’s easy to say decouple and default but what politician wants to tell voters their salary will buy 30% less goods next week, that their house is worth 30% less, savings, pension… etc.”

    OK, but think about this- the entire local economy (ie apart from imports and exports) would be downsizing to the drachma level. Everything they have to pay for, would have to settle to a new devalued level. So if workers are getting only 100 drachma instead of 100 Euro, the food they buy, the rent they pay, will have to come down proportionally.
    They would probably need aid, from the EU, to subsidise the imports they need, like medical supplies, and oil and gas. Because after a default, they wouldn’t be able to get new loans.
    I know that in that scenario, the whole internal economy wouldn’t drop-settle-stabilise perfectly across the board. There would be some big winners and big losers. But on the whole, it could help to banish the spectre of destitution that is haunting the Greeks.
    It seems to me that staying in the Euro is a false aspiration. How many years of punishing austerity would it take to clear that enormous debt? For all we know, it could be decades, especially if the austerity measures themselves are likely to compound the agony by shrinking the Greek GDP, leaving them paying more and more debt interest, out of less and less revenue. Young Greeks entering the labour market today as graduates or apprentices, might never see the end of it, and never reap any of the benefit. I’ve never seen any calculations of that debt burden-versus-time scenario, but it still worries me.

  23. theyenguy
    Posted June 18, 2012 at 8:50 pm | Permalink

    Yes the scheme of the Euro has failed; but out of Financial Armageddon, that is a credit bust and global financial breakdown, foretold in Revelation 13:3-4, new schemes of regional framework will provide for regional security, stability and sustainability, as leaders meet in summits to waive national sovereignty and pool sovereignty regionally.

    Bible prophecy of Daniel 2:30-33, presents that regional governance will dominate in all of the world ten regions. Revelation 13:1-4, communicates A One Euro Government, will creep up of the profligate nation of Greece, to be a type of revived Roman Empire, where Germany will be preeminent over the peripheral PIIIGS. And God’s Word further reveals a king, Revelation, 13:5-10, perhaps Olli Rehn, Herman van Rompuy, or Jean-Claude Juncker, and a banker Revelation 13:11-18, perhaps Jens Weidmann or Mario Draghi, will rise to rule Europe.

  24. zorro
    Posted June 18, 2012 at 9:18 pm | Permalink

    Cameron in Los Cabos……..’The danger is that the Greek people have made their choice to stay in the Euro, and have to accept the consequences of what involves…..delay is always dangerous in these circumstance……Delay could be deadly….’

    http://www.oxfordmail.co.uk/news/national/

    Deadly? Deadly for who exactly….?

    zorro

    • zorro
      Posted June 18, 2012 at 9:20 pm | Permalink

      Chilling…..

  25. Conrad Jones (Cheam)
    Posted June 18, 2012 at 10:09 pm | Permalink

    Mr Redwood, Happy Birthday – 15-June.

    The BBC Newsnight American interviewee tonight was asked how Greece will get of of debt:

    He said:
    “It’s about … ”
    1. ” rcapitising the Banks”
    2. ” boosting confidence in the Financial Markets”
    3. ” attracting Investors and improving the confidence of investors”
    4. ” more Fiscal Union ”
    5. ” continuing with Austerity and Tax increases ”

    It’s not about … (apparently)
    1. ” Spending”
    2. ” Manufacturing”
    3. ” Low Treasury Bond Rates”
    4. “improving liquidity”
    5. ” reducing unemployment”

    To hell with the Greek people ?- let’s make Investors more Confident that they will make a profit from Greek Investments.

    Afterall, Investors are far more important than the Greek People. Germany is circling for an encore of 1942, this time – they don’t need Guns, just Financial Weapons of Mass destruction.

    The ECB is hiding in the shadows profiteering from this chaos and looking forward to a Future where it has even more power.

    Nigel Farage for Eurpoean President:
    http://www.dailymail.co.uk/debate/article-2158835/Going-Viral-Nigel-Farage-slams-incompetent-Mariano-Rajoy-warns-Euro-Titanic-hit-iceberg.html

  26. Lindsay McDougall
    Posted June 19, 2012 at 5:25 pm | Permalink

    Why do the Grreks think that staying in or leaving the Euro zone is solely their decision. If you break the fiscal rules, impose a 75% ‘haircut’ on holders of your bonds, borrow money that you can’t afford to borrow, then seek to renege on your agreements, you are not going to be very welcome, are you?

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    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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