Greece Explained

An excellent video from VOX. No more oversimplified than the final demand letters Greece is getting from Angela Merkel.

I keep going back to the meme I invented a couple of years ago: Kiss Up, Kick Down. Is this crisis just an international version of junior high bullying? The powerful preying on the powerless? Noam Chomsky writes about this.

Vox has discovered that NSA wiretaps reveal Angela Merkel's cynical calculations prior to the Greek bailout. Why did Merkel and Germany send Greece so much money knowing the debt would be unsustainable? Maybe the potential profit caused them to ignore the risks. No intention of fixing a problem, just a strong impulse to milk that problem for profit. The payday loan model again.

Europe isn’t a family. Families don’t starve the child that does poorly in school. Families don’t think how they can profit from a family member’s failure.

I realize it gets complicated in families too. But nations and organizations of nations need to lean toward the helpful model rather than the exploitive one. Think St. Francis not some mob kingpin. Keynes not Friedman. The Marshall Plan, not the Versailles Treaty.

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.

Are Workers Expendable?

Efficiency is measured by corporate economists as revenue minus expenses. Profit is created the same way. Profit therefore equals Efficiency. Profit is the ultimate good and the only obligation, an obligation only paid upward. What’s the expense economists are most eager to eliminate? The cost of labor.

Workers present downward obligations and such obligations are a burden. They are, by definition, inefficient, because obligations owed to workers are always counted as a negative. Corporations don’t feel obligations to plants and machines. Plants and machines don’t make them feel angry or guilty or deprived of profit. They can be bought and sold and don't need to be paid. They do as they're told. They can be insured and depreciated. They can be replaced with more efficient machines and don't require severance or unemployment or a pension or healthcare.

Keynes thought the unending march toward greater efficiency and greater productivity would pay a dividend to everyone in the form of leisure. He didn’t think that leisure would be unemployment and poverty. This is the looming likelihood nobody wants to discuss. We all have mixed feelings. Our retirements hinge upon the profitability of the companies in our retirement portfolios, which hinge upon the suppression of labor costs, and our retirement portfolios are purchased with wages we are paid for the work we do.

People who work for a living have a conundrum that people who own for a living never have to worry about. We’ve always been a country that worships hard work, but that god has been replaced with Profit, a higher god that believes work should be as poorly rewarded as possible. The god Profit likes the fruits of work but believes those fruits belong in the profit column. Profits belong to those who own for a living.

It would all be much easier if all work could be done by machines which don’t need to be paid, which can be depreciated and sold and moved almost like slaves. Welcome to the age of the robot.

Even China, with its endless and captive labor force, is falling in love with robots. How will this unfold? In China every human being is expendable. (The New York Times reports.)

Look at this map of most common jobs per state over the past 40 years. It’s also a map of mostly very expendable jobs, jobs that are being relentlessly robotized.

Did you notice how many states employ more truck drivers than any other kind of worker? Read this article about the replacability of human drivers.

Discuss.