You are currently browsing the tag archive for the ‘EU’ tag.

The streets are in chaos. There’s bank runs and people are starting to stock up on canned food. The government is stockpiling arms, Neo-Nazis are marching in the streets and nobody knows what the country, or the wider world, will look like five days from now.

No, this isn’t a replay of Y2K. There isn’t a hurricane on the way, an oil shortage or impending Avengers-style alien invasion. This is the lead-up to the next round of Greek elections. New Democracy (conservatives) and SYRIZA (radical leftists) are tied at the polls, with a serious possibility that anti-austerity parties will win, possibly forcing a Greek exit (“Grexit”) from the European common currency. This has markets around the world in terror, many of which (China, Russia, Italy, Spain, America and others) are in serious peril themselves. It’s being called the “Election Apocalypse”.

I thought I’d heard it all. Apocalyptic doomsaying, after all, is one of my favourite topics. What’s happening in Greece, though, isn’t the (direct) result of climate change, peak oil or devastating warfare. The economic catastrophe didn’t come because Greece resisted the bailouts or austerity – so far the country has gone alone with all the demands, in spite of enormous popular resistance. Austerity failed, dramatically, plunging the country into a far deeper recession. This catastrophe is the direct result of every major establishment institution functioning exactly as it was “supposed to”. The real threat facing Greece represents the first real chance the Greek people have had to put the breaks on this process, an opportunity they should have had a long time ago.

Money is leaving the country’s banking system in droves, both to citizens($1 billion/day) and foreign investors fearful of the re-introduction of Greece’s old currency, the Drachma. Currency traders are already gearing up to deal with it, with the Drachma even accidentally showing up on Bloomberg’s trading board. Unemployment and poverty are at absolutely horrific levels. Strikes are breaking out everywhere, even threatening the elections themselves as municipal workers threatened to strike during the vote. There’s also funding problems within electrical utilities, threatening to plunge a third of the nation into rolling blackouts if it can’t find hundreds of millions for Russian natural gas soon. Oh, and the government bought a enormous stockpile of American weapons earlier this year, more than anybody but the UK and UAE in the first quarter. In short, Greece is collapsing under the weight of it’s own bureaucracies.

Perhaps the most horrifying part of this story is the rise of the Golden Dawn, a Neo-Nazi political party which won enough votes to enter Parliament in the last election. They’ve been involved with brutal attacks on immigrants and others, with widespread accusations of collusion with Greek police. It got worse last week when their spokesman assaulted a female opponent on national television. Warrants are out for his arrest, but he has not yet turned up and is attempting to press counter-charges. In response, massive anti-fascist marches have started taking to the streets, and they’ve dropped dramatically in the polls. All of this is set against a backdrop of growing anti-immigrant sentiment across Europe, in which Greece plays an important role as a geographic gateway to the continent.

If anyone has doubts that this catastrophe was the result of conscious efforts to punish the country, I’d urge them to read this piece by renowned business journalist Hugo Dixon. “Greece needs to go to the brink. Only then will the people back a government that can pursue the tough programme needed to turn the country around,” he argues, by cutting off bailout funds and other supports. These views are very common, and readily apparent to anyone who reads the business press (or actions of the ECB). Of course, if you follow those sourced you’d also know that real economists refute these guys all the time. Right now the Greek people, like those of Argentina and elsewhere before them, are being punished in the hopes that they’ll vote to continue dismantling their country.

The scale of the problem, of course, goes well beyond Greece. Not only have interest rates also rocketed up in Italy and Spain, but Spain is now facing another bailout. Markets around the world, even Toronto, have been heavily battered in recent weeks by the crisis, and (as always) there’s a serious fear that another massive stock market crash is on the way. For what it’s worth – it probably is.

The crisis in Greece needs to be seen for what it is – not the result of popular meddling or anarchist rioting – the onus for this like squarely on bankers and politicians. The ongoing bailouts show the horrendous cost, total ineffectiveness and callous disregard for everybody else. While people lose homes and jobs, banks are being given hundreds of billions to make the same mistakes over and over again, with exactly the same results. We’ve created a system which pays banks hundreds of billions of dollars to fail. Why would they do anything else?

Austerity and bailouts have not worked. They’re based on exactly the same flawed premises which drove the markets to disaster in the first place. The crashes of 2008, 2001 and 1989 weren’t caused by progressive social overspending, they were the result of overheated and deregulated markets where speculation came to dwarf real investment. Then, as now, nobody saw any difference between a million dollars created on paper through stock valuations and a million dollars created through actual production. Because it’s far easier to create value through speculation (in the short run), it became the focus of three decades of public and private economic policy. Until we come to grips with that, any attempt to jump-start failing global markets will hundreds of billions in bailouts and “quantitative easing” (money-printing through low interest rates) will only work toward re-creating these same bubbles. Austerity, the source of these funds, only makes things far worse by making devastating cuts to real public and private value (hospitals, schools, steel mills etc).

For the Greek people, this is a very grim choice. If they vote to stick with the terms of the bailout, they will be stuck with the austerity program which is devastating their country. If they vote to abandon it, the short-term chaos will be far worse, and likely spread far beyond very quickly. Either way, there’s a very real chance that the Greek Parliament will burn to the ground before this is over. If so, it’s leaders will have none but themselves to blame.

We all need to learn from this this Greek tragedy, before we all repeat the same mistakes and find ourselves facing a similar nightmare.

...and always bring a towel.

Good advice from a stencil on the Jackson Square rooftop, Hamilton, Ontario.

Once again, the European Union is spiraling toward oblivion. Not only are Greece’s re-elections a week away, but Spain is now in need of another bailout and Italy is beginning to sputter again. As the dangers involve swing once again from “quagmire” to “clusterfuck”, even the Toronto Stock Exchange is feeling the brunt of it. In response, one very clever graffiti artist has decorated the roof of Jackson Square with two choice words which would serve the EU’s leaders and bankers very well right now: “don’t panic”.

No, that’s not deja-vu you’re feeling, this really has been happening every couple of weeks for over a year now. At the core of the problem lies the way national debt is traded on bond markets, much like stocks or futures. Demand in these auctions and markets determines the interest rate on the debt, therefore fear of a debt-crisis-spiral (like seen in Greece) can easily drive a country’s interest rates through the roof (as they did to Spain and Italy today). The standard response is to cut debt and deficits (“austerity”), but since it’s far easier for interest rates to double than to cut a national debt in half, this usually does a lot more harm than good (as it has in Greece, Spain, Britain, and most of the Third World). Worst of all, the only thing really needed to kick off this cycle is to announce that you’re planning a bailout or austerity measures to send investors panicking, even if the national economy in question is relatively “healthy”.

They will, of course, panic, sooner or later. There is no way out of this crisis without a “correction” of some kind or another. Economies will topple like a row of dominos line up around the globe. When this happens, and it will, we’ll have one task that’s more important than any other: not panicking.

Good luck with that.

Over the past week the world has learned a lot about how Greek elections function. After a ballot is held, if there is no clear majority winner (there wasn’t), each party gets a chance at putting together a coalition to hold parliamentary power, in order of their success at the polls. If each of these parties fails, (which they did), the President has one last chance to meet with parties and form a “unity” government (they collapsed). When that fails (it just did), new elections are called (a month from tomorrow).

We’ve known for a few days now this was happening, with radical leftists Syriza coming in second place in the election and rising in the polls from there, it’s now acknowledged that they’d probably win the next round of elections. This set off a predictable wave of terror in the world’s financial community, causing markets to shudder and spreading rumours that Germany might be willing to budge on their hard-line austerity policies. At least as likely an outcome is that this would lead to a Greek “exit” from the Eurozone and probably the destruction of the European common economy as we know it. Syriza couldn’t have asked for a better reaction.

The Greek people may finally get their referendum on austerity, the mere mention of which was enough to see their elected Prime Minister deposed and replaced by a “technocrat” supported by Europe’s central bankers. In this climate, there’s every reason to expect they’re going to vote “no”, and most of the world knows it. Whether or not Syriza can effectively govern the country isn’t the issue – nobody’s doing that now. At best their win would be a “solution” but at worst it’s revenge, and I suspect either will do at this point.

How could they do this to us!?!

I’m sure that’s a question ordinary Greek people have been asking for some time now. Their economy was utterly destroyed, their government deposed, their “national character” thoroughly dragged through the mud. European financial elites made an example of Greece in their attempt to bully others into accepting austerity programs, and as long as the country’s creditors got paid, few cared what happened to Greeks themselves. Maybe now they will.

Will this be the catalyst for a massive market crash? That’s very possible, but if so, that doesn’t mean Greek voters (or rioters) are to blame. The world’s economies are like a powder keg right now, from Beijing to Boston. If it isn’t Greece it’ll be Spain, Italy or something else entirely. Financial elites have pointed fingers at everyone but themselves, but it’s clear no poor folks set this up – bubbles aren’t the product of union wages or welfare. Will poor folks suffer? Undoubtedly, but that’s on Goldman, not the Greek people. If anything, this only shows how desperately things have to change.

Greece is teaching a valuable lesson here: austerity is not inevitable. If we actually stand up, they will back down. These policies were driven by fear and panic, claiming the future of Europe was at stake. Only now are elites realising what kind of position this puts Greece in – they’re holding all the cards, and they just called everybody’s bluff.

Results are in for the most recent European elections – austerity did not fare well. In France incumbent Nicolas Sarkozy was defeated by Francois Hollande, the socialist candidate. In Germany, Angela Merkel’s ruling party suffered losses in regional elections. And of course, the Greek ruling coalition disintegrated in a flurry of protest votes. Today the leading centre-right “New Democracy” announced their failure to form a government, well short of the three days they were allowed. This has plunged the financial world into a panic, causing markets to drop around the globe.

They’re calling it “austerity fatigue“. Forced on nations across Europe and beyond, these cuts were hoped to revitalize Europe’s economies – instead they became both a political and economic disaster. Popular rage against the measures has been simmering for years (particularly in Greece), but lately it’s become very hard to ignore, especially as nations like Spain and Britain slip back into recession. Even large parts of the business press now openly condemn these measures. To quote the Globe and Mail

Over the past two years, France and Germany have steered Europe through the debt crisis — though not always well. Germany and France declared an end to the flagrant flouting of deficit limits that led Europe into the crisis.

But the crackdown could not have come at a worse time — with the world economy slowing — and propelled Europe into a vicious austerity spiral. Cutting spending — which meant laying off state employees and ending stimulus programs — further slowed nations’ economies and produced less tax revenue, which meant more cuts were needed to meet deficit targets.

The rest of this week should be interesting, and will likely be beyond chaotic. Within the span of a single weekend, any hopes that we’d left the uncertainty and fear of last year behind us have been totally destroyed. Like one year ago, nobody knows if Greece will stay in the EU, whether Europe could survive such an exit or what that would mean to the rest of us.

Looking “across the pond” right now, it’s pretty clear where austerity is taking us. These efforts to loot and pillage entire economies have so far led to social and fiscal disaster. Canada is only starting down this path, but we only need to look at Europe to see where it’s leading. We still have time to stop this, before our cities too are choked with the black smoke of burning skylines, before public suicides become a standard form of protest and before cabals of bankers start replacing our elected officials with “technocrats” of their choosing. Again, I have to ask – what kind of maniac would willingly do this to our country?

All eyes will be on Europe this week, and there’s no telling what the situation could look like by Friday. It’s a complete clusterfucking quagmire, but it may also be the first opportunity to stop this madness before it gets any worse.

Many of us have always been sceptical of emissions trading schemes. Stock, futures and currency markets are so full of speculation, manipulation and outright abuse that it’s hard to imagine such a system ever doing something meaningful about Climate change.

The idea simply raises too many questions. Essentially, it privatises pollution in which the legal right to pollute can be bought and sold. Who gets the privilige of spewing greenhouse gasses? Like any kid of private property, the issue of “who gets it first” is essential. Do we award these credits to big polluters based on current emissions? If we do, is that not essentially paying them for being the worst culprits?

The European Union’s markets have not been doing well. Most recently, traders have been outraged at poor press releases by the EU as to policy (which types of emmissions would be banned, and when) which caused some of the biggest swings in carbon price ever. Worse yet, a rash of digital thefts in Eastern Europe have pocketed tens of millions worth of credits. The term “Mickey Mouse Markets” is being thrown around, and I don’t blame anyone who uses it. If not even the traders are happy here, then why are we still embracing this ridiculous notion?

Carbon-trading markets represent everything which is wrong with the modern use of the term market. Every aspect of these markets is crafted by governments and corporations to reflect their interests, and create a playing field in which they can still maintain control. What is bought, sold and traded is not real goods, but state-enforced control over production processes (their emissions). There’s nothing free or fair about the trade that takes place on carbon markets – any more than there is on currency or stock markets. You can never have free or fair trade when some players start out with thousands more chips than others.

If people can’t recognize the economic incentives to not pollute which already exist, a pittance from carbon markets won’t change anything. I’d love to be paid for riding my bike instead of owning a car, but in reality, I am. It saves me the better part of a thousand dollars a month. Pollution does’t happen by accident – it happens because twisted regulation schemes of “property ownership” promote it. And another one of these twisted schemes isn’t an answer.

Enter your email address to follow this blog and receive notifications of new posts by email.

Archives

RSS Newsfeed

obtainium83

Building a new world from the bones of the old one.

Hamilton Urban Forest Coalition

Promoting the protection, enhancement and appreciation of urban forests in the City of Hamilton

The Laboratory of Insurrectionary Imagination

“This is not a normal travelling theatre company you know!” Scotland Yard.

Knowing the Land is Resistance

Based in the remaining Carolinian forest, nestled between Lake Ontario and the Niagara Escarpment...

Narrative Resistance

fighting back against dominant stories

Warrior Publications

Purpose: To promote warrior culture, fighting spirit, and resistance movements