More Greek Perspectives (with some humor mixed in)

Germany vs. Greece, the Python Version.

From the NYRB, an interesting essay explaining how austerity policies like those the EU is imposing on Greece are similar to the policies George III imposed on the 13 American colonies. The result then was revolution.

Jeffrey Sachs urges the EU creditors to write down the debt.

Joseph Stiglitz, the views of a Nobel economist.

Kenneth Rogoff explains why the bailout failed. (And this is the fault of both the European creditors and Greece.)

Another worthwhile argument (From the Guardian, the dangers of deficit fetishists)

A thought I’ve been having: how would this work in a family? Most of the children are fine, doing well in school, if grown they’re earning a living. But one child fails in school. How does it help to withhold food from the one who fails in school? Will he stop failing if he has nothing to eat? If he’s refused medical care or family affection?

The perspective of a former “economic hit man”: what is happening to Greece looks a lot like the kind of damage he used to do.

Greece is the Word

When a nation is in a financial crisis it’s not always best to think like a banker. A banker cares more about his money than about the people involved. (It's easier that way.) There are certainly hard truths we need to face about the Greek crisis, and difficult problems that need to be fixed. But is a crisis the best time for a banker to extract his late fees and penalties? Does it matter if Greece recovers from this? For many of the financial experts discussing it, the money is less abstract than the people.

In the Guardian, Nobel economist Joseph Stiglitz returns us to a more rational discussion of what is involved and what will restore Greece’s financial health.

Even the conservative Daily Telegraph has a negative view of how Europe’s bankers have handled this. This writer says the Euro bankers set Greece up to fail.

Europe is a far different place than it was in the era of Keynes. We took Keynes' advice after WW2. By then we knew from grim experience not to treat a fallen nation the way Europe treated Germany in 1920.

I have an idea: look at how Germany was helped by the Marshall Plan after WW2. Maybe Greece would be treated better now if they'd invaded Europe instead of joining it.

From the Economist

From the London School of Economics

From TruthOut

German bankers think Greece has already been helped enough. The point is, after WW2 Germany was helped until they recovered. There should be mechanisms put in place that help repair the problems that caused the Greek crisis. Instead the European bankers, apparently, prefer to create a profitable lender-borrower relationship, and profitable relationships are meant to last, creating longterm profits for the lender. Did the European banks base their rescue plan on the model of payday lenders? (From the Guardian)

The Greek finance minister takes a very dim view of austerity.

The austerity model fails wherever it is tried. Why? Because it doesn't allow recovery. Instead it extracts the pound of flesh from the corpse of the debtor. Only money exists in the world of these bankers. No people, no communities, no societies, no nations, just money.

Economist Lars Syll on the failed austerity model

In Europe as in the U.S., it’s a case of Kiss Up, Kick Down. Pay the rich, gouge the poor. In any failed transaction the fault always lies with the poorer party. He always pays the penalty. (From the Washington Post)

Here are some key views from the bankers’ table via the New York Times

If Europe were a federal system like the U.S., the crisis in one state would matter to everyone. This idea gets a fuller airing at VOX.

Kiss Up. Kick Down.

The massive shift of wealth upward is being engineered as if it’s a war on debt. Make the working class feel pinched, get them in debt, and use that fear of debt as a rationale for paying them less and less, and cutting public efforts to ease the unfairness and relieve distress.

Paul Krugman wrote an excellent piece about The Austerity Delusion for the Guardian.

Another Nobel economist, Joseph Stiglitz, has been warning about the same things. But concentrated wealth can create its own reality.

The class who own for a living use large amounts of cash (they have trillions) to create ads warning about the debt being placed on the children of the people who work for a living.

But this is a bogus warning. They are placing the debt on working people by shifting their tax burden onto working people.

They say public debt will burden our children, but they only want to stop the spending that helps working people.

They are gung-ho about corporate military contractor spending and private prison spending. They oppose education funding and infrastructure funding, calling it wasteful. They oppose fairer taxation that would place the tax burden where it was when we actually had a prosperous working class and functioning infrastructure.

They oppose public spending, calling it a burden on our children. This is as insane as saying we should starve our children to protect their inheritance. It carries enormous social costs. This kind of narrow, self-serving greed is what erodes civilizations. It ultimately leads to collapse. Of course, the wealthy will have offloaded their wealth to remote islands by then.

Even in Kansas, working people are talking back. One waitress has caused quite a stir.

Would you like to see a picture of vast wealth on parade? They always gather to watch two persons of color beat each other up. Now they come in luxury jets instead of limousines. Who paid for that airport? The working taxpayer.

The Republican solution is to give the small class of people who own for a living (whose irresponsible behavior caused the Great Recession) a big fat bonus. A bonus that will perpetuate their wealth and eliminate their obligations to the society that made them rich.

Their hubris is breathtaking. Perhaps because their billions will buy ads to persuade the public to do what they want the public to do. They have only contempt for those who dislike concentrated wealth. People like Pope Francis. In this political climate Jesus wouldn’t have been let near a microphone.

Inequality Is Bad For Us

In scientific tests animals reject inequality. So do children. Why do adults keep silent on it?

Maybe because the beneficiaries of inequality punish criticism. In grade school, teachers reward fairness. In the real world the controllers of income and markets reject fairness because they can get away with it, and they suppress dissent (as shown in this National Journal piece). They get away with it because they hold power. They hold us hostage because they have the money.

Joseph Stiglitz, one of our great Nobel Prize winning economists, says inequality is holding back our economic recovery. (Here's his piece in the NYTimes.)

Paul Krugman, our other Nobel economist, also liberal, doesn't disagree exactly but he doesn't see how Stiglitz's argument works out.

This is how liberal economists are different than conservative ones: they are skeptics. They demand you show them the math, which is not true of the economists who gave us the economic collapse.

Just ask Glenn Hubbard. (This Rolling Stone article does a good job dissecting his conflicts of interest.) He was one of the midwives of the economic crisis. He built the car that drove us over the cliff. He was a Bush economist while he was also earning money rationalizing what the large financial institutions were doing that caused the crisis. (Watch the documentary Inside Job if you want to see Hubbard talk himself into a corner.)

Closed systems that self-justify tend to make the same mistakes over and over again, and they do this because no matter what mistakes they make the people who run them find ways to keep their money and their power.

Krugman has a neat seven minute tutorial on inequality that's worth watching.

Inequality is not natural, it is not common sense, it is not good for us. It is, however, good for the people who keep telling us it's natural, sensible and good. Ask yourself this, what kind of a businessman works to impoverish his customers? That is what Reaganomics has done over the past three decades. The engine of any strong economy turns out to be workers who earn a good living. See Krugman's video above.

But now even conservative economic journals like the Economist are beginning to see the damage inequality does. For one thing it insulates the rich from negative consequences and healthy skepticism. It also is just bad economics on a fundamental level, never mind what economic yes-men say to their wealthy clients.

Inequality, I'm speaking of vast inequality like we have today, isn't fair, isn't inevitable, isn't natural, isn't sensible, and isn't a good thing. It's holding us back. It's even holding back the rich who think it benefits them. What would happen if our politicians understood this?

Republicans and The Greater Fool

I didn't realize that pretending to be charitable could save a person millions of dollars in taxes every year. But it's worked for Romney. He can promise to give to charity and take the deduction and then not give as much or at all, as this article in Bloomberg News explains.

Fuzzy Math? Voodoo Economics? Flim-Flam? Senate Republicans prove that math that you refuse to look at doesn't actually exist. At what point can you prosecute a political party for covering up the truth? Or for lying? There's a non-partisan report that shows clearly that cutting tax on the very rich doesn't help the economy at all. No wonder they're hiding it.

Information is power. Hiding it gives power to the powerful, who tend to be Republicans and their clients. Republicans prefer the public didn't listen to Nobel Prize economists like Joseph Stiglitz and Paul Krugman. Listen anyway. Make them mad. And vote accordingly.

There is a weird consistency to Republican thought (if I can call it that.) They prefer Americans believe bad science and non-science rather than the best science. They want Americans to ignore what NASA and our top atmospheric scientists have been saying about climate change. They want us to ignore the evidence of Hurricane Sandy. Republicans persist in trusting numbers that don't add up, plans that their candidate won't show, voodoo economic policies that failed disastrously during the Bush years.

There is, in economics, something called the "Greater Fool Theory", which says that you can always sell a product, no matter how bogus, no matter how foul and dangerous, simply by finding someone more foolish than you are, or more ill-informed or gullible, to buy it. To increase the number of greater fools you can also lie.

(As Romney is doing in Ohio and Michigan right now with his ads falsely claiming Obama somehow forced Jeep to send American jobs to China. Obama saved Jeep and Jeep is increasing its hiring in Ohio and Michigan.)

Good Economics vs. Bad Economics-You Choose

It's time to choose sides. Despite what you hear on the money programs and from the Wall Street cheerleaders, there are very good economists who think austerity economics is a bad idea. Paul Krugman and Joseph Stiglitz, our most recent Nobel economists, are on the Democratic side of this argument, the side of the 99%. Others are stepping up too.

"On November 13th 2011, economists from the University of Massachusetts Amherst drafted an open statement to the Occupy Wall Street movement pledging their support. Since then, more than 250 economists from around the world have added their names. Read more at econ4.org "

To be fair, there are two sides to this argument. Having watched the documentary Inside Job, I know that some economists know exactly who butters their bread and it isn't working people. It's the people who now have all the money who butter their bread. Some economists are happy to tailor their ideas to suit their benefactors.

Then there are the mouthpieces for the 1%, who earn a lot of money just by being mouthpieces. For instance, there's Ann Coulter, who said recently that she thinks the horrible dirty worthless people of the Occupy movement should be gunned down by the police. It worked on the Vietnam protesters, she says.

Larry Summers, who led Obama's economic team, doesn't come off very well in Inside Job, but he is on the right side of the argument now, favoring aggressive stimulus and tax cuts to working people––instead of more billions thrown at the rich, at corporations and banks. He's no fool.

Concentrated wealth got us here. It made our economy topheavy and fragile. It sucked the life out of the consumer economy by making working people less prosperous and less able to make ends meet.

Our economy will only revive when working people feel prosperous again, confident that their jobs are secure, that their health and their families are secure, that their children have a future. We need to shift from the Reagan economics of concentrated wealth. Those economic policies promoted and exploited broad insecurity and vulnerability rather than broad prosperity and strength.

Today, more than 2 million Brits took to the streets to protest their government's austerity policy. What is Austerity? It's the rich elite's answer to global recession. "We have money so we get to buy. Everybody else is poor, so they should live that way."

AUSTERITY IS HOW THE RICH AND POWERFUL TEACH WORKING PEOPLE TO BE POOR.

That is where austerity measures bite. They bite the poor, the working people, the middle class who are getting poorer every year. Austerity bites the victims of the global collapse which was caused by the very rich.

In this country it's the Republican economic policy. They want most Americans to be a lot poorer, a lot less secure. When Americans are afraid they work harder and longer for less. That's the long term Republican goal. In the short term the Republicans simply want Americans to suffer, figuring an unhappy populace will vote for Republicans next year. They are happy for Americans to fail in order for Obama to fail.

Do you want to see what effect Republican policies have? Look at the map of the British austerity measures put in place by their Conservative government.

Austerity doesn't work during a recession. It hasn't before. It won't now. Imagine an airline pilot in a stalling aircraft. Does he see the emergency as an opportunity to save fuel? No. He pushes the pedal down and accelerates out of the dive.

Here are some sound commentaries from economists on the intelligent side of this argument, setting out the dire consequences of these ugly conservative policies. From EconMatters.com

From CNN

Here's Robert Reich's useful and persuasive debunking of the Republican austerity policies.

Sadly, cable television is dominated by a Republican network and talk radio is all Republican all the time. And a lot of Americans are easy to fool.

Today's Must Read-The Panic of the Plutocrats

Krugman won a Nobel Prize in Economics. So did Joseph Stiglitz. Why, instead, do Americans believe the stock speculator "experts" who dominate FoxNews and CNBC and CNN-Money? Krugman nails it again today. Now I know what the P stands for in GOP: Plutocrat.

What's alarming and disgusting is how much of our broadcast air is devoted to these Plutocrats, these puffed up aristos, many of whom have "earned" their fabulous lifestyles by speculating with mommy and daddy's money, playing with inherited wealth. America has changed in the past forty years from one that values and rewards work to one that worships and protects the few people with great wealth. Teddy Roosevelt called them "malefactors of great wealth". He was a Republican, but not today's kind of Republican.

The modern Republican Party caters to wealth. Working people don't have it. The financial system and the post-Reagan decline of the middle class has seen to that. The system has skewed so radically because of Reaganomics (the "trickle-down" fairy tale) to the point where owning is now more honored than working. Those who own stocks for a living pay a much lower tax rate than people who work. And anyone who doesn't like this is called a Marxist or a Hitler.

Nonsense.

The Wall Street protesters are protesting unfairness and the kind of Old World aristocracy America was created to get away from. (Think Louis XIV) We 99% are angry about the restoration of the Old World model––except for those still hypnotized by the Murdoch media. If the Tea Partiers would think about it, they belong to the 99% too. We have common cause.