Category Archives: European Union

Foreign Office to face inquiry into role played by UK in Libya’s collapse

Matthew Weaver reports for The Guardian:

‘The Foreign Office is to face questions over Libya’s descent into a failed state, following the launch of an inquiry by an influential committee of MPs into Britain’s role in the overthrow of Muammar Gaddafi and the troubled aftermath.

Launching the inquiry, the Tory chairman of the foreign affairs select committee, Crispin Blunt, told the Guardian that the intervention and subsequent breakdown of the state had proved disastrous for Libya and posed a global security threat.

He said: “It has turned out to be a catastrophe for the people of Libya. And now it is a growing problem for us, with our undoubted enemy Isis beginning to establish control of areas of Libya. Plus the migration crisis – any area where state authority collapses obviously poses problems for us all over the world.”

Blunt, a former government minister, said the inquiry will investigate Britain’s capacity to conduct the necessary post-intervention planning.’

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Documents Published by WikiLeaks Reveal the NSA’s Corporate Priorities

Bill Blunden reports for Truthout:

Cyber espionage“We are under pressure from the Treasury to justify our budget, and commercial espionage is one way of making a direct contribution to the nation’s balance of payments.” – Sir Colin McColl, MI6 Chief

For years public figures have condemned cyber espionage committed against the United States by intruders launching their attacks out of China. These same officials then turn around and justify the United States’ far-reaching surveillance apparatus in terms of preventing terrorist attacks. Yet classified documents published by WikiLeaks reveal just how empty these talking points are. Specifically, top-secret intercepts prove that economic spying by the United States is pervasive, that not even allies are safe and that it’s wielded to benefit powerful corporate interests.

At a recent campaign event in New Hampshire, Hillary Clinton accused China of “trying to hack into everything that doesn’t move in America.” Clinton’s hyperbole is redolent of similar claims from the US deep state. For example, who could forget the statement made by former NSA director Keith Alexander that Chinese cyber espionage represents the greatest transfer of wealth in history? Alexander has obviously never heard of quantitative easing (QE) or the self-perpetuating “global war on terror,” which has likewise eaten through trillions of dollars. Losses due to cyber espionage are a rounding error compared to the tidal wave of money channeled through QE and the war on terror.’

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Between Berlin and a Hard Place: Greece and the German Strategy to Dominate Europe

Andrew Gavin Marshall writes:

[…] The German bet was that the EU could outrun financial markets, using the crisis as an opportunity to advance fiscal and political integration and impose their demands upon the rest of Europe, while simultaneously preventing markets from creating a crisis so severe that it threatened the euro or the economies of the more powerful nations. Without the pressure of financial markets, the EU could not force its member nations to restructure their economies and societies. Chancellor Merkel would frequently describe the European debt crisis to her colleagues as a “poker game” between financial markets and politicians. The first to flinch would lose.

In 2011, Bloomberg noted that Merkel was “turning Europe’s sovereign-debt crisis into an opportunity to reshape the euro region in Germany’s image,” concluding that she had “pulled ahead for now in her battle to restore policy makers’ mastery over the market.” A biographer of Merkel explained, “It’s policy by trial and error.”

Merkel’s powerful Finance Minister, Mr. Schauble, was one of the chief architects of the German strategy for Europe’s crisis. In March of 2010, he wrote in the Financial Times that, “from Germany’s perspective, European integration, monetary union and the euro are the only choice.” But aid comes with strings attached and harsh penalties for violations. “It must, on principle, still be possible for a state to go bankrupt,” wrote Mr. Schauble. “Facing an unpleasant reality could be the better option in certain conditions.”

The German minister believed “the financial crisis in the eurozone is not just a threat, but an opportunity,” as markets would “force the most debt-laden members of the 17-nation currency union to curb their budget deficits and increase their competitiveness.” This would pressure governments to accept further integration into a “fiscal union” defined and shaped by Germany. “We need to take big steps to get that done,” Mr. Schauble said in 2011. “That is why crises are also opportunities. We can get things done that we could not do without the crisis.”

Financial markets were happy to oblige the German-EU strategy, as the crisis would force the reforms long demanded by banks as a solution to the irresponsible spending of governments: austerity and structural reform. From 2002 to 2012, Josef Ackermann led Germany’s largest bank, Deutsche Bank. In 2011, the New York Timesdescribed Ackermann as “the most powerful banker in Europe” and “possibly the most dangerous one, too,” standing “at the center of more concentric circles of power than any other banker on the Continent.”’

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The problem of Greece is not only a tragedy. It is a lie.

John Pilger writes:

An historic betrayal has consumed Greece. Having set aside the mandate of the Greek electorate, the Syriza government has willfully ignored last week’s landslide “No” vote and secretly agreed a raft of repressive, impoverishing measures in return for a “bailout” that means sinister foreign control and a warning to the world.

Prime Minister Alexis Tsipras has pushed through parliament a proposal to cut at least 13 billion euros from the public purse – 4 billion euros more than the “austerity” figure rejected overwhelmingly by the majority of the Greek population in a referendum on 5 July.

These reportedly include a 50 per cent increase in the cost of healthcare for pensioners, almost 40 per cent of whom live in poverty; deep cuts in public sector wages; the complete privatization of public facilities such as airports and ports; a rise in value added tax to 23 per cent, now applied to the Greek islands where people struggle to eke out a living. There is more to come.

“Anti-austerity party sweeps to stunning victory”, declared a Guardian headline on January 25. “Radical leftists” the paper called Tsipras and his impressively-educated comrades. They wore open neck shirts, and the finance minister rode a motorbike and was described as a “rock star of economics”. It was a façade. They were not radical in any sense of that cliched label, neither were they “anti austerity”.’

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Paul Mason on Greece: “Finance will be used in a hostile way if you flout the sovereignty of Europe”

‘Greece will have to implement the tough austerity measures demanded by its lenders, plus hand €50bn of assets to a privatisation fund, where sales will be used to pay down debt.’ (Channel 4 News)

Greece is the latest battleground in the financial elite’s war on democracy

George Monbiot recently wrote from The Guardian:

Irish famine, original illustrationGreece may be financially bankrupt, but the troika is politically bankrupt. Those who persecute this nation wield illegitimate, undemocratic powers, powers of the kind now afflicting us all. Consider the International Monetary Fund. The distribution of power here was perfectly stitched up: IMF decisions require an 85% majority, and the US holds 17% of the votes.

The IMF is controlled by the rich, and governs the poor on their behalf. It’s now doing to Greece what it has done to one poor nation after another, from Argentina to Zambia. Its structural adjustment programmes have forced scores of elected governments to dismantle public spending, destroying health, education and all the means by which the wretched of the earth might improve their lives.

The same programme is imposed regardless of circumstance: every country the IMF colonises must place the control of inflation ahead of other economic objectives; immediately remove barriers to trade and the flow of capital; liberalise its banking system; reduce government spending on everything bar debt repayments; and privatise assets that can be sold to foreign investors.’

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#ThisIsACoup: Dimitri Lascaris and Michalis Spourdalakis on the Humiliating Eurozone Offer to Greece

Wikileaks Revelations Expose US Tentacles: Interview with Michael Ratner

Michael Ratner is president emeritus of the Center for Constitutional Rights (CCR), president of the European Center for Constitutional and Human Rights (ECCHR), and U.S. attorney for Julian Assange and Wikileaks. In this interview he breaks down the latest Wikileaks revelations. (The Real News)

Capitalism and Government Debt at Odds in Greece: Interview with Michael Hudson

Michael Hudson is research professor of economics at University of Missouri, Kansas City (UMKC) and a research associate at the Levy Economics Institute of Bard College. In this interview he says that unlike personal and corporate debt, there is no legal framework for writing off government debt, so there is deliberate anarchy in place. (The Real News)

Was Tsipras’ referendum worth it? Paul Mason on the Greek debt crisis

‘The new Greek government proposals, published late last night are clearly based on those submitted by Jean Claude Juncker last Thursday, before the referendum. It’s left many Greeks frustrated, asking: what was the point of the referendum?’ (Channel 4 News)

We Voted ‘No’ To Slavery, But ‘Yes’ To Our Chains: Greg Palast On Greece

Greg Palast is an investigative reporter who has worked for the BBC and the Guardian, among others. He is the author of several books including Vultures’ Picnic and The Best Money Democracy Can Buy.

The Srebrenica Precedent

David N. Gibbs, author of First Do No Harm, writes for Jacobin:

This month marks the twentieth anniversary of the Srebrenica massacre, in which eight thousand people were killed in the Bosnian town of Srebrenica. The mass killing was the single deadliest event of the Bosnian War, and the most recognized atrocity of the post–Cold War era.

Its significance cannot be overstated: the massacre triggered a NATO bombing campaign that is widely credited with ending the Bosnian War and giving NATO a new lease on life after the fall of the Soviet Union. Ever since, the Srebrenica precedent has been invoked to justify military interventions around the globe.

In 2005, Christopher Hitchens defended the US decision to invade Iraq with an article entitled “From Srebrenica to Baghdad.” In 2011, when Guardian columnist Peter Preston advocated military intervention in Libya, his article began with the words: “Remember Srebrenica?” In 2012, a call in CNN for Western intervention in Syria appeared under the title “Syria, Sarajevo, and Srebrenica.” And a 2014 article on ISIS advances in Syria warned of a possible “New Srebrenica,” with the implication that Western military action was needed to prevent this calamity.

When supporters of military intervention cite Srebrenica, it’s often to insist on the need to dispense with diplomacy and use decisive military force in response to humanitarian emergencies. As a 2006 New Republic editorial succinctly argued, “In the response to most foreign policy crises, the use of military force is properly viewed as a last resort. In the response to genocide, the use of military force is properly viewed as a first resort.” Given the broad way that genocide is now defined, this is a call for interventions without limit.’

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How Britain and the US decided to abandon Srebrenica to its fate

Florence Hartmann and Ed Vulliamy report for The Guardian:

MUSLIM REFUGEES[…] Over two decades, 14 of the murderers have been convicted at the war crimes tribunal in The Hague. The Bosnian Serb political leader Radovan Karadžic and his military counterpart, General Ratko Mladic, await verdicts in trials for genocide. Blame among the “international community”charged with protecting Srebrenica has piled, not without reason, on the head of UN forces in the area, General Bernard Janvier, for opposing intervention – notably air strikes – that might have repelled the Serb advance, and Dutch soldiers who not only failed in their duty to protect Srebrenica but evicted terrified civilians seeking shelter in their headquarters, and watched the Serbs separate women and young children from their male quarry.

Now a survey of the mass of evidence reveals that the fall of Srebrenica formed part of a policy by the three “great powers” – Britain, France and the US – and by the UN leadership, in pursuit of peace at any price; peace at the terrible expense of Srebrenica, which gathered critical mass from 1994 onwards, and reached its bloody denouement in July 1995.

Until now, it has always been asserted that the so-called “endgame strategy” that forged a peace settlement for – and postwar map of – Bosnia followed the “reality on the ground” after the fall, and ceding, of Srebrenica. What can now be revealed is that the “endgame” preceded that fall, and was – as it turned out – conditional upon it.

The western powers whose negotiations led to Srebrenica’s downfall cannot be said to have known the extent of the massacre that would follow, but the evidence demonstrates they were aware – or should have been – of Mladic’s declared intention to have the Bosniak Muslim population of the entire region “vanish completely”. In the history of eastern Bosnia over the three years that preceded the massacre, that can only have meant one thing.’

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European Parliament re-brands ISDS, still wants to let companies to sue nations

Glyn Moody reports for Ars Technica:

The European Parliament today called for foreign investors to be allowed to sue the EU and member states in special new courts. This controversial proposal came as part of a non-binding set of recommendations to the European Commission on the Transatlantic Trade and Investment Partnership (TTIP), currently being negotiated with the US. The new investor courts would replace the old investor tribunals employed as part of the investor-state dispute settlement (ISDS) system, but would function largely in the same way.

Adopting an amendment proposed by the Socialists and Democrats (S&D) group, the European Parliament called on the European Commission to set up new ISDS courts featuring “publicly appointed, independent professional judges,” instead of corporate lawyers, as at present, and holding public hearings with an appeal mechanism. The S&D says this is “the end of ISDS in EU trade deals.”

In putting forward this compromise amendment, however, the left-wing group has implicitly acquiesced in the idea of granting foreign investors special rights not enjoyed by domestic companies—the key issue that lies at the heart of ISDS. Moreover, the new investor courts are just as one-sided as the current ISDS tribunals: although companies will be able sue the EU and member states for billions, with the public footing the bill, there is no mechanism for the EU to sue companies. The best the public can ever hope for is not to lose.’

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Paul Mason on Yanis Varoufakis quitting despite Greek referendum victory

Spain’s New Security Law Meets Fierce Criticism From Rights Groups

Alissa Greenberg reports for Time:

Demonstrators with their mouths taped sit outside the Spanish parliament during a protest against Spanish government's new security law in central MadridA new law that went into effect in Spain on July 1 has much of the country, as well as many human rights organizations, in an uproar. While proponents say the new public security law will reinforce civil liberties, opponents call it the “gag law,” saying it will do just the opposite and take the country a step backward toward dictatorship.

The law covers everything from internet surfing to drug trafficking, but opponents point specifically to portions targeting illegal downloading, habitual access of websites that allegedly promote terrorism, and violent protest, as problematic, saying they include too-loose language that could be abused for political purposes and will limit freedom of speech or even prevent reports of police brutality.

Under the law, citizens can be fined the equivalent of almost $700 for insulting an officer, over $33,000 for recording and disseminating images of police officers, and more than $664,000 for participating in an unauthorized protest outside government buildings, the New York Times reports.’

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Greek Voters Deliver Stunning Rebuke to Austerity: Dimitri Lascaris Interviews Michael Spourdalakis

Michael Spourdalakis is the Dean of the School of Economics and Politics at the University of Athens. In this interview with Dimitri Lascaris, he says that it is time for the Greek government to play hardball with the Troika. (The Real News)

Paul Mason on the Greek referendum: “For the first time in the history of the Eurozone, people power has happened”

In A World Of Artificial Liquidity – Cash Is King

Editor’s Note: Nomi Prins is a former managing director at Goldman Sachs and a former senior managing director at Bear Stearns. I would HIGHLY recommend reading her latest book, “All The Presidents’ Bankers“. You can read part two of this article here. Also, be sure to check out more of Nomi’s great work at her website.

Nomi Prins writes for Peak Prosperity:

Global central banks are afraid. Before Greece tried to stand up to the Troika, they were merely worried. Now it’s clear that no matter what they tell themselves and the world about the necessity or even righteousness of their monetary policies, liquidity can still disappear in an instant. Or at least, that’s what they should be thinking.

The Federal Reserve and US government led policy of injecting liquidity into the US and then into the worldwide financial system has resulted in the issuance of trillions of dollars of debt, recycling it through the largest private banks, and driving rates to 0% — or below. The combined book of debt that the Fed and European Central Bank (ECB) hold is $7 trillion. None of that has gone remotely into fixing the real global economy. Nor have the banks that have ben aided by this cheap money increased lending to the real economy. Instead, they have hoarded their bounty of cash. It’s not so much whether this game can continue for the near future on an international scale. It can. It is. The bigger problem is that central banks have no plan B in the event of a massive liquidity event.

Some central bank entity leaders have admitted this. IMF chief, Christine Lagarde for instance, warned Federal Reserve Chair, Janet Yellen that potential US rate hikes implemented too soon, would incite greater systemic calamity. She’s not wrong. That’s what we’ve come to: a financial system reliant on external stimulus to survive.’

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Greek Crisis Marks End of Debt Era

Atul Singh writes for Fair Observer:

[…] The Greek debt crisis is about to go global. First, other European countries are bound to be affected. Even France, la grande nation, will eventually come under pressure. Second, even states and cities will face pressure. Already, Puerto Rico’s government has declared that it cannot pay its $73 billion debt. In fact, all government-backed debt from sovereign to municipal bonds will come under pressure. Third, the US and China will eventually face a debt crisis too. The crisis is global and about to amplify.

The ballooning of debt is the biggest challenge facing the world economy. To stave off economic collapse, governments bailed out American and European banks. Central banks then released a torrent of money into the system by lowering interest rates and using quantitative easing, emulating the Bank of Japan. Those who own assets became richer, exacerbating already terrible inequality. Governments support creditors to boost economic confidence, while home owners in the US and ordinary citizens are fed to the dogs.

There is certainly a glut of savings in some parts of the world. China and Germany are awash with capital and are looking to park their money in assets that give them higher return. Yet there are limits to returns in a world awash with capital. The Chinese bubble in real estate and stocks has burst. Yet China is putting more money into its economy. It has made a fourth cut in interest rates since November and has reduced reserve requirements for banks, so they can continue lending. China has also lowered transaction fees and relaxed collateral rules on borrowing to fund share purchases. This is debt-fueled madness.

Like all parties, the Chinese one is coming to an end and stocks have lost nearly 25% of their value since the middle of June. Hence, Chinese money is flocking to the US in search of a safe harbor. Chinese buyers are now purchasing houses in California without even looking at them. China continues to fund US debt and shudders in horror as quantitative easing dilutes the value of its reserves. Unlike smaller countries like Greece, the US will never face default. It has the unique luxury of diluting its debt by simply printing more dollars. As the superpower in-charge of the world’s reserve currency, it can live off debt a little longer. It offers the greatest security to investors in an uncertain world. Yet the music will one day stop playing even for the US.’

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The forgotten origins of Greece’s crisis will make you think twice about who’s to blame

Ana Swanson reports for The Washington Post:

[…] In the mid-1990s, even before it came into existence, markets made a huge bet that the euro would be a reality. Specifically, investors, many in northern Europe, bet that interest rates in northern and southern Europe would converge. At the time, interest rates in southern Europe were much higher than in northern Europe, simply because people thought investing in countries like Greece was much riskier than investing in countries like Germany.

In anticipation of the euro zone, investors put lots of money in the cheap, high-yielding bonds of southern Europe. That helped to drive down yields and fueled borrowing and an economic boom in southern countries.

Ultimately, investors were right – Greek interest rates on 10-year bonds fell from around 20 percent in the early 1990s to only 3 percent in 2002. “They made a lot of money in the north betting against higher interest rates there. That fueled the boom, before the euro came, that overheated these economies.”

As economies overheated, it’s not a surprise that their competitiveness suffered, says Matthijs [co-editor of The Future of the Euro].

In short, many in the north pushed for a financial regime that didn’t fit the Greek economy, because they personally stood to benefit. Many rightly blame the Greeks for its current crisis, but some of the blame belongs farther north as well, he argues.’

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How Europe Played Greece

Alex Andreou writes for Common Dreams:

[…] Faith in European Institutions is thin on the ground. Lines have been crossed. At times of financial strain, a country’s currency issuer, its central bank, should act as lender of last resort and prime technocratic negotiator. In Greece’s case, the European Central Bank, sits on the same side as the creditors; acts as their enforcer. This is unprecedented.

The ECB has acted to asphyxiate the Greek economy – the ultimate blackmail to force subordination. The money is there, in our accounts, but we cannot have access to it, because the overseers of our own banking system, the very people who some months ago issued guarantees of liquidity, have decided to deny liquidity. We have phantom money, but no real money. There is a terrifying poetry to that, since the entire crisis was caused by too much phantom money in the first place.

EU Institutions are now openly admitting that their aim is regime change. A coup d’état in anything by name, using banks instead of tanks and a corrupt media as the occupiers’ broadcaster. The rest of Europe stands back and watches. Those leaders who promised the Syriza government support before the election, have ducked for cover. I understand it. They sympathise, but they don’t want to be next. They are honourable cowards. They look at the punishment beating being meted out and their instinct is to protect their own. ‘

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Joseph Stiglitz: How I would vote in the Greek referendum

Joseph Stiglitz, a Nobel laureate in economics, writes for The Guardian:

Alexis Tsipras, leader of the radical left main opposition party Syriza, greets supporters after a rally of the party in the northern Greek port city of Thessaloniki, January 2015. […] In January, Greece’s citizens voted for a government committed to ending austerity. If the government were simply fulfilling its campaign promises, it would already have rejected the proposal. But it wanted to give Greeks a chance to weigh in on this issue, so critical for their country’s future wellbeing.

That concern for popular legitimacy is incompatible with the politics of the eurozone, which was never a very democratic project. Most of its members’ governments did not seek their people’s approval to turn over their monetary sovereignty to the ECB. When Sweden’s did, Swedes said no. They understood that unemployment would rise if the country’s monetary policy were set by a central bank that focused single-mindedly on inflation (and also that there would be insufficient attention to financial stability). The economy would suffer, because the economic model underlying the eurozone was predicated on power relationships that disadvantaged workers.

And, sure enough, what we are seeing now, 16 years after the eurozone institutionalised those relationships, is the antithesis of democracy: many European leaders want to see the end of prime minister Alexis Tsipras’ leftist government. After all, it is extremely inconvenient to have in Greece a government that is so opposed to the types of policies that have done so much to increase inequality in so many advanced countries, and that is so committed to curbing the unbridled power of wealth. They seem to believe that they can eventually bring down the Greek government by bullying it into accepting an agreement that contravenes its mandate.’

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Presidents, Bankers, the Neo-Cold War and the World Bank

Editor’s Note: Nomi Prins is a former managing director at Goldman Sachs and a former senior managing director at Bear Stearns. I would HIGHLY recommend reading her latest book, “All The Presidents’ Bankers“. You can check out more of Nomi’s great work at her website.

Nomi Prins writes:

At first glance, the neo-Cold War between the US and its post WWII European Allies vs. Russia over the Ukraine, and the stonewalling of Greece by the Troika might appear to have little in common. Yet both are manifestations of a political-military-financial power play that began during the first Cold War. Behind the bravado of today’s sanctions and austerity measures lies the decision-making alliance that private bankers enjoy in conjunction with government and multinational entries like NATO and the World Bank.

It is President Obama’s foreign policy to back the Ukraine against Russia; in 1958, it was the Eisenhower Doctrine that protected Lebanon from a Soviet threat. For President Truman, the Marshall Plan arose partly to guard Greece (and other US allies) from Communism, but it also had lasting economic implications. The alignment of political leaders and key bankers was more personal back then, but the implications were similar to the present day. US military might protected its major trading partners, which in turn, did business with US banks. One power reinforced the other. Today, the ECB’s QE program funds swanky Frankfurt headquarters and prioritizes Germany’s super-bank, Deutschebank and its bond investors above Greece’s future.

These actions, then and now, have roots in the American ideology of melding military, political and financial power that flourished in the haze of World War II.  It’s not fair to pin this triple-power stance on one man, or even one bank; yet one man and one bank signified that power in all of its dimensions, including the use of political enemy creation to achieve financial goals. That man was John McCloy, ‘Chairman of the Establishment’ as his biographer, Kai Bird, characterized him. The relationship between McCloy and Truman cemented a set of public-private practices that strengthened private US banks globally at the expense of weaker, potentially Soviet (now Russian) leaning countries.’

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US Hedge Funds Get Bailed Out if Greeks Pass Bailout Referendum: Interview with Bill Black and Michael Hudson

‘Foreign banks want to bleed the patient when a policy of debt cutting and tax reform would revive the Greek economy, say UMKC’s Bill Black and Michael Hudson.’ (The Real News)

The IMF defaulted on Greece a long time ago

Jerome Roos writes for ROAR Mag:

Post image for The IMF defaulted on Greece a long time agoTuesday marked the deadline for Greece to transfer a 1.6 billion euro debt repayment to the IMF. The country’s Finance Minister Yanis Varoufakis had already announced that his government could not — and would not — pay. And so, at 6pm Washington-time, 1am locally, Greece officially defaulted on the IMF.

The default is an unprecedented event in the history of finance: never before has a developed country fallen into arrears on a loan from the Fund. Unsurprisingly, the international press is already conjuring up unflattering comparisons with notorious failed states like Zimbabwe and Somalia, which are among the few countries to have gone down the same path of utter financial ignominy. With all due respect for Zimbabwe and Somalia, the implication of this media narrative is clear: Greece is about to become a hopeless basket case.

In truth, superficial parallels like these are dangerously misleading. Not only do they compare apples and oranges; they also end up obscuring the IMF’s own role in the decimation of the Greek economy, which basically made an eventual Greek default inevitable. By uncritically reproducing narratives of Greece’s “failure” to repay the Fund, many in the international media are directly overlooking the fierce internal criticism that top IMF officials have expressed about their own responsibility for the utter disaster of the Troika’s bailout programs.’

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As Greece Heads for Default, Voters Prepare to Vote in Pivotal Referendum on More Austerity: Interview with Costas Panayotakis

‘Tens of thousands of Greeks have protested against further austerity cuts ahead of a key referendum on a new European bailout. The demonstrations come as the country confirms it will not meet the deadline for a $1.8 billion loan repayment due by 6 p.m. Eastern time tonight, deepening Greece’s fiscal crisis and threatening its exit from the eurozone. Greece will hold a vote this Sunday on whether to accept an austerity package of budget cuts and tax hikes in exchange for new loans. Greek Prime Minister Alexis Tsipras has urged a “no” vote, calling the proposal a surrender. We go to Greece to speak with Costas Panayotakis, professor of sociology at the New York City College of Technology at CUNY and author of “Remaking Scarcity: From Capitalist Inefficiency to Economic Democracy.”‘ (Democracy Now!)

Robert Mundell, evil genius of the euro

Greg Palast wrote for The Guardian in 2012:

John Maynard Keynes in 1944 at the UN International Monetary Conference in Bretton Woods, NHThe idea that the euro has “failed” is dangerously naive. The euro is doing exactly what its progenitor – and the wealthy 1%-ers who adopted it – predicted and planned for it to do.

That progenitor is former University of Chicago economist Robert Mundell. The architect of “supply-side economics” is now a professor at Columbia University, but I knew him through his connection to my Chicago professor, Milton Friedman, back before Mundell’s research on currencies and exchange rates had produced the blueprint for European monetary union and a common European currency.

[…] The euro would really do its work when crises hit, Mundell explained. Removing a government’s control over currency would prevent nasty little elected officials from using Keynesian monetary and fiscal juice to pull a nation out of recession.

“It puts monetary policy out of the reach of politicians,” he said. “[And] without fiscal policy, the only way nations can keep jobs is by the competitive reduction of rules on business.”

He cited labor laws, environmental regulations and, of course, taxes. All would be flushed away by the euro. Democracy would not be allowed to interfere with the marketplace.’

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Will the Greek Referendum Force the Troika Back to the Bargaining Table? Interview with Dimitri Lascaris and Leo Panitch

‘Dimitri Lascaris and Leo Panitch discuss the possible consequences of a ‘no’ vote in the July 5th referendum on the bailout conditions offered by international creditors.’ (The Real News)

Joseph Stiglitz on the “criminal responsibility” of Greece’s creditors

Simon Shuster writes for TIME:

A few years ago, when Greece was still at the start of its slide into an economic depression, the Nobel prize-winning economist Joseph Stiglitz remembers discussing the crisis with Greek officials. What they wanted was a stimulus package to boost growth and create jobs, and Stiglitz, who had just produced an influential report for the United Nations on how to deal with the global financial crisis, agreed that this would be the best way forward. Instead, Greece’s foreign creditors imposed a strict program of austerity. The Greek economy has shrunk by about 25% since 2010. The cost-cutting was an enormous mistake, Stiglitz says, and it’s time for the creditors to admit it.

“They have criminal responsibility,” he says of the so-called troika of financial institutions that bailed out the Greek economy in 2010, namely the International Monetary Fund, the European Commission and the European Central Bank. “It’s a kind of criminal responsibility for causing a major recession,” Stiglitz tells TIME in a phone interview.

Along with a growing number of the world’s most influential economists, Stiglitz has begun to urge the troika to forgive Greece’s debt – estimated to be worth close to $300 billion in bailouts – and to offer the stimulus money that two successive Greek governments have been requesting.

Failure to do so, Stiglitz argues, would not only worsen the recession in Greece – already deeper and more prolonged than the Great Depression in the U.S. – it would also wreck the credibility of Europe’s common currency, the euro, and put the global economy at risk of contagion.’

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