rolling european politics thread 2011

when did we stop being included in this btw?

There was no boom for them, particularly, other than that jobs were available.

offset that against the rising cost of property in most of these countries (for instance, over here the property boom inflated house prices to absorb most of the second income into households that had two people working, which i think was where a lot of the rise in employment came from)

"Stop being included" - you mean the UK not being on the hook for "bailing out" Greece? I don't think the UK ever was in the frame for that. Not in the Eurozone innit.

"When you say this you need to identify what you mean by "Greece""

Unfortunately, a good part of the Greek troubles are older than the 2008 crisis, that just made things worse.
Enormous public debt, underdeveloped economic infrastructures, a pension system in rags, scant productivity, fake bookkeeping, endemic political corruption, a wild use of European funds and subsequent speculation all concurred in creating this catastrophic situation.
And, for the record, Italy could be next and very much for the same reasons.

I agree with you that not everyone partied (and this makes the crisis even more unjust) but certainly both countries (their governments and some of their citizens) have precise political and historical responsabilities that it is necessary to understand. Just to make a very basic example, they should have asked themselves how it was possible for hundred of thousands of people to retire after just 15 years of work without paying some kind of economic price in the future.

xp no, tracer, ireland

the last graf ties in with my general feeling of the last three or four years that is suddenly has become clear that politicians are simply no match for large vested capital interests. like, at all. on health care in the US, or in virtually every aspect of this ongoing financial crisis, politicians - and possibly "politics" in general - appear as ineffectual specks against the stern colossi of big money, whose warnings about "confidence" are taken as gospel. and meanwhile billions in government assets are privatized, turned over to holding companies and banks... in order to pay for bank bailouts.

― 40% chill and 100% negative (Tracer Hand), Saturday, June 18, 2011 1:30 PM (3 days ago) Bookmark

yup. super depressing '1931' vibe about all this.

http://www.nakedcapitalism.com/2011/06/alex-andreou-democracy-vs-mythology-–-the-battle-in-syntagma-square.html

^

i guess you have to c 'n' p that

That's a good post. It doesn't resolve the question I've been pondering, though. He writes:

It is vital to understand that I do not wish to excuse my compatriots of all blame. We did plenty wrong....We were teenagers with their parents’ platinum card. I did not see a pair of sunglasses not emblazoned with Diesel or Prada. I did not see a pair of flip-flops not bearing the logo of Versace or D&G. The cars around me were predominantly Mercedes and BMWs. If anyone took a holiday anywhere closer than Thailand, they kept it a secret. There was an incredible lack of common sense and no warning that this spring of wealth may not be inexhaustible. We became a nation sleepwalking toward the deep end of our newly-built, Italian-tiled swimming pool without a care that at some point our toes may not be able to touch the bottom.

That irresponsibility, however, was only a very small part of the problem. The much bigger part was the emergence of a new class of foreign business interests ruled by plutocracy, a church dominated by greed and a political dynasticism which made a candidate’s surname the only relevant consideration when voting. And while we were borrowing and spending (which is affectionately known as “growth”), they were squeezing every ounce of blood from the other end through a system of corruption so gross that it was worthy of any banana republic; so prevalent and brazen that everyone just shrugged their shoulders and accepted it or became part of it.

What does it mean that this "irresponsibility" was "only a very small part of the problem"? Is his point that even if citizens hadn't lived beyond their means, that the nation would be fucked anyway? If that's his point, then I'd like to see the evidence for that.

After a bit more reflection, I'm getting clearer on this. What difference does it make to Greek sovereign debt that Greek citizens borrowed a lot of money? Yes, the details are a bit tacky, but provided that those citizens paid back their loans, it doesn't affect the national bottom line at all. Indeed even if they didn't pay back those loans, it doesn't matter for national debt, unless the EU constitution requires that the nation is ultimately responsible for private debt to EU banks. (Is the latter true?) But otherwise, Greek national debt can only be explained by national spending, for which the personal habits of citizens are irrelevant except inasmuch as they were participating in national spending. Just taking out a loan for a swimming pool doesn't mean they were participating in national spending. Just getting low-interest loans doesn't necessary mean they were participating in national spending. If they received a chunk of land from the government whose value was artificially inflated, then we're talking; or obviously if they were cheating on their taxes. But I'm increasingly thinking that attempts to put the moral hazard of Greek's forthcoming default on ordinary citizens is yet another ruse by the plutocrats to do exactly what they're accusing Greek citizens of doing: of treating someone else's money as theirs.

i think the main thing the germans are focussing on is the size and nature of the greek public sector and its pension system, rather than personal debt

i don't believe everyone in greece had a pool and designer schmutter

good---that's not mentioned in the post to which Tracer linked, & I'm guessing that's an intentional omission. The closest that post gets is the following:

And the biggest myth of them all: Greeks are protesting because they want the bail-out but not the austerity that goes with it. This is a fundamental untruth. Greeks are protesting because they do not want the bail-out at all. They have already accepted cuts which would be unfathomable in the UK – think of what Cameron is doing and multiply it by ten. Benefits have not been paid in over six months. Basic salaries have been cut to 550 Euros (£440) a month.

But what if those benefits were too generous, given the Greek economy? What if those salaries are about right, given the Greek economy? I'm not sure that's right, but the questions of personal debt are irrelevant (this is probably obvious to European readers but in thinking about this through the filter of the American foreclosure crisis, the "personal irresponsibility" angle is hard to avoid)

the language is the same tho: "all in this together". Governments that have barely been representative democracies at best, and the power structures that coerce and inform those governments' policies - fundamentally not "The People" - now trying to instil an almighty sense of guilt in the people they've misrepresented, cheated and conned. And I feel like The End of History is at play here too; as the differences between political parties within the European democracies have become vanishingly small so the need for parties to offer policies which appeal to the electorate has begun to disappear. Choose which brand of oppression you prefer, kinda.

Because when has the "generosity" of benefits or state medical care ever been set by the electorate?

right, NV: though who's the intended audience for these accusations of guilt? The Germans? The Greeks?

in the USA these issues are clearest to me in the financing of sports stadia: a city wants to build a new stadium to keep or attract a team, so they give tax breaks, financing deals, free land, etc., to businesses to develop these stadia, & put this all on the government tab. Occasionally the electorate is given a voice: you can vote for/against a sales tax hike to pay for this, or a hike in rental car & hotel taxes. But it's rarely this direct, & often just put into city/state debt. & you could vote against these jokers but everyone plays the same game so what's it matter?

I think the intended audience is the populations of all the democracies. The crisis shd reveal the extent to which we as participants in democracy are merely the governed - an elite plutocracy/technocracy making all the meaningful decisions and offering the veneer of choice to people who can't hope to understand the mechanics of how a state functions. Lots of reports in newspapers about who's getting paid what as if we can make an informed response to these abstractions - forever arguing with my dad about how one can comment about the financial minutiae of an organisation like the NHS without having a firm understanding of how it is run or could be run.

So then, rather than admit that democracy isn't all that democratic and that maybe sometimes the front men fumble the ball, better to portray it as some collective transgression against the gods of The Economy and start doling out the penitences hard and fast.

I've lost track of who actually is in control. It's clearly not the public. It's not politicians terrified of the influence of the market. I'm not sure it's bankers and financiers who appear to be incapable of either predicting or directing the course of events. I doubt it's the EU or central banks trying to keep a lid on it.

^ Sadly, this.

Also, while Irish and Icelandic crises were inherently financial, the Greek one has been caused mostly by insane political choices made in the last 15 years (Karamanlis government anyone?).
Because of its unrestrained internal spending (not to mention tax evasion, probably even bigger than the Italian one but in presence of a weaker economy), Greece contracted a public debt of more than 300 billions of euros, half of which hold by European banks (mainly French and German) that simply can't go down (consequences would be catastrophic, talk about domino effect).
We can complain that the same financial institutions now in trouble back in 2000/2001 helped the Greek government fiddling with bookkeeping and statistics, but speculation is always triggered off by systemic weakness (and demonic greed, of course).
Add to this that the euro was good for big economies like Germany and France, but put smaller countries like Greece or Portugal in a truly bad situation (income quickly went down while import costs kept growing, classic inflation scenario, and in the meantime people were borrowing money to buy stuff).

'we're all to blame, look at all the designer specs and mercs'

Yeah, this is a line peddled a lot around here this past few years.

Mainly by people and the offspring of the people not paying back enormous private debt, and therefore pretty much net beneficiaries of a bankruptcy/debt forgiveness/bank bailout/publicise private debt to support collapsing system/'oh shit how much now everything is fucked' cycle

We've got a lot of these ppl. They're doing ok, ime. Very few of them land in front of me looking for ever-shrinking housing supports, very few of them work beside me for an ever-shrinking wage.

i mean, these are the cunts that gave us jedward- we have entire towns full of the likes ffs

I feel most sorry for the people of Portugal. They don't seem to have had a mickey mouse speculative boom or a grossly dysfunctional corrupt and incompetent state apparatus, yet they still seem to have been lumped with austerity and a fiscal crisis, despite seeming to be as poor as ever.

I think they did have a speculative boom. A Portuguese friend of mine tells me that Porto and Lisbon suddenly sprouted loads of bankers and fancy restaurants around the turn of the millenium.

But he also said the notoriously laid-back attitude of Portuguese builders actually acted as a brake on property speculation specifically.. getting a flat renovated takes like three years of phone calls and arguments

National stereotypes to the rescue.

http://www.bbc.co.uk/news/world-europe-13899740

Interesting stuff happening in Kyiv at the moment.

hottest head of state ever?

"The sovereignty of Greece will be massively limited," [Eurogroup chairman Jean-Claude Juncker] told Germany's Focus magazine. ...

"For the forthcoming wave of privatizations they will need, for example, a solution based on a model of Germany's 'Treuhand agency'," Juncker said, referring to the privatization agency that sold off 14,000 East German firms between 1990 and 1994. ...

Treuhand was supposed to sell state property at a profit but closed with a huge deficit and a legacy of bitterness among the legions of workers whose jobs it destroyed. Four million Germans were employed by Treuhand-owned companies in 1990 but only about 1.5 million jobs were left by 1994.

http://www.reuters.com/article/2011/07/03/us-eurogroup-greece-idUSTRE76219J20110703

situation obviously sucks hard but im going to come out and say that maaaaaybe the east german economy of 1990 wasn't on the firmest of footings...

Germany in 1990 is such a sui generis that it seems odd to try to use it as a model for anything.

mayne what's your point?

that greece shd default really. i don't think they have a hope in hell of pulling off these austerity measures, which won't actually make their economy functional but bail out investors. clearly it needs to remodel its economy: how to do that without social and political breakdown i leave to the geniuses.

it's guaranteed that they will default. they literally have no way of paying off their debts. the question is, how much looting can the EU get away with before that occurs? the austerity stuff is an excuse for that looting (i.e. privatization); the annual greek budget deficit is actually not very large. what this bailout ensures is that the looting can continue apace.

(didn't mean to be snarky, i just didn't see what point you were making with your east germany comment)

i mean i am really not kidding - the whole point of the "bailout" is to ensure that massive privatizations can go forward before greece collapses completely.

shd be retitled 'rolling into the shitbin' imo

with an undercard of 'ireland vs the church'- just announced

hard to come up with anything here but 'i am so fucking appalled' + a reference to 'they live'

http://krugman.blogs.nytimes.com/2011/07/21/1937-1937-1937

The Telegraph has a leaked draft of the eurozone rescue plan for Greece. The financial engineering is Rube Goldbergish and unconvincing. But here’s what leaped out at me:

9. All euro area Member States will adhere strictly to the agreed fiscal targets, improve competitiveness and address macro-economic imbalances. Deficits in all countries except those under a programme will be brought below 3% by 2013 at the latest.

OK, so we’re going to demand harsh austerity in the debt-crisis countries; and meanwhile, we’re also going to have austerity in the non-debt-crisis countries.

Plus, the ECB is raising rates.

So demand will be depressed in both crisis and non-crisis economies; this will lead to a vigorous recovery through … what?

The Serious People are determined to destroy all the advanced economies in the name of prudence.

Italian prime minister Silvio Berlusconi took advantage of a government press conference last night to push his own shares. He said if he had savings he'd fill his boots with Mediaset, which was now "utterly undervalued".

this guy

osbourne's plan to hold onto RBS just a little bit longer is..... not lookin so wise

funny how the famous yet unnamed "investors" on both sides of the atlantic appear to be in a fullblown baffled panic, looking at the other side for cues

i.e. america looking at european bond rates, and europeans holding their breath for NFP figures

i think a question that might be worth asking is, who are these "investors" and why do they run the world? and why do they have billions of basically idle money lying around when unemployment is up everywhere and businesses are in a slump?

Would be interesting to know how much of that is pension funds.

yeah it's mainly professionally invested funds, right?

is there any overlap between professionally invested funds and "hot money"? -

http://en.wikipedia.org/wiki/Hot_money

i was sincere in wanting to know the composition of these giant money flows

out of my league, really

my vague understanding is that hot money flows in and out of countries are on the order of hundreds of billions of dollars every day

Guys are we seriously not talking about this right now? If we are, I can't find the thread...

we are not afaik

Maybe there's an 'occupy athens' thread i'm missing tho

is there a good outline of all the possible scenarios atp w/r/t greece staying/leaving in the eurozone?

scorchedearth.jpg

idk

i know one of the people who runs those auctions

can

u

hook

me

up

srsly

you want to live in galway?

four bed detached in athenry is good time living imo

tell them preference is detached 3-4 bed near westport, but yeah galway (outside the city obv, along the M6 a bonus) or any of the leafier suburbs of dublin would all be acceptable

also you know auctions are for cash buyers?

showing up with mortgage approved docs is acceptable iirc?

yeah it says you have to complete within four weeks, i think a week or ten days is the standard practice here

this'd do too, with a bit of work http://www.allsopspace.ie/auction/lot/4777

assuming you could get a survey and approval (not the easiest with some decrepit if picturesque old house) then that's probably a couple grand at least before some spiv outbids you

unless things are radically different in ireland now, these things are mostly for developers and chancers, the proportion of homebuyers at auctions is small

ilx fundraising effort to cover purchase, refurbishment, guaranteed lodging for worldfap 2017 and two weeks a year for life to any poster contributing more than idk 5k

xp

idk

with the coming (expected) increase in repossessions after personal insolvency legislation changes, and given that these auctions enjoy a very high profile, idk

could become a thing for a few years amongst homebuyers, once-off investors, what-have-you. rent vs the type of mortgage outlay required for these makes in inevitable i think.

probably as straight a normalisation method as any maybe.

http://www.allsopspace.ie/auction/lot/4930

that rent would cover a good two bedroom flat in an inner london suburb, no wonder the rentiers are fleeing at those yields

straffan v much stockbroker belt equivalent tbf