The Greek government [pushed] through Parliament an austerity package to avert a default on billions of euros in government debt. Success, only postpone[s] an unsavory choice that the euro area's leaders will face sooner or later: Let Greece go and put both the European experiment and the global economy at risk, or forge a deeper union in the face of opposition from their voters. The Greek crisis has become a defining moment in a project that traces back to the 1950s, when a small group of politicians started what would eventually be known as the European Union. Their aim was to form such strong political and economic ties that the horrors of World War II could never happen again. – Bloomberg
Dominant Social Theme: The EU will continue to prosper. What has taken place are only "bumps on the road."
Free-Market Analysis: It wasn't supposed to be like this. The Bloomberg article excerpted above, recites the appropriate dominant social theme as regards the European Union, but the tone is likely a good deal more doleful than Eurocrats may have expected when planning the EU's greater consolidation.
The EU is the bastard child of a European vision of united Europe that goes back as much as 2,000 years and the even more comprehensive vision of Anglosphere elites that seek a "new world order." The idea that the EU was formed, as Bloomberg writes, "so that the horrors of World War II could never happen again," is probably nonsense.
In order to believe this nostrum, one must first explain why Western banks and elite families funded Adolf Hitler's rise and seemingly continued to fund him through at least part of the war itself. Like most if not all wars of the modern era, the Anglosphere power elite seems to have been involved on both sides, first creating an enemy and then prosecuting him.
In fact, history, more and more, is exposing Hitler's increasingly desperate attempts to STOP the war at numerous intervals. It was, perhaps, one of the reasons that he let the British army escape at Dunkirk. Winston Churchill, in particular would have none of it. The war would continue until Germany was decimated.
Churchill, in fact, liked war. He was a depressive man and chaos comforted him. He wrote letters about it. He was an instrument of Western Money Power and those who wield Money Power are warlike generally; the Anglo Saxon banking families in the City of London are seemingly bathed in blood.
The EU consolidation itself is growing bloodier, though blood in this case was probably not intended. No, the script called for a controllable recession and then a quick consolidation of EU powers to make the European Union into a true super state.
But somewhere on the road to nation-hood, the process was snagged first by an economic crisis that has proven far more tenacious then expected and second by tremendous pushback to the European Union itself and its Brussels' masters. The EU Eurocrats and their elite overlords seem to be growing increasingly desperate. The level of resistance is perhaps unexpected.
It is in our view, of course, that the Internet has facilitated the unexpected pushback. It is complicated by other factors. The dollar reserve system virtually died in 2008 (when the entire post-Bretton Woods system collapsed) and nobody has come up with anything to replace it.
The current system staggers along without creating either jobs or money. Lacking any alternative, Eurocrats demand austerity and more austerity. It is a recipe for social chaos, one that's occurring throughout Europe, especially in Greece and Spain.
Up to 80 percent of Greeks reject the additional austerity package that the Greek parliament just passed. A Greek language Youtube video, popular in Greece, calls for a repudiation of Greek debts and a down reevaluation of (a presumably new) Greek currency. It has been viewed well over a million times. There are perhaps 10 million people in Greece.
It is simply a fact that those behind the elites expected that the current crisis would drive to the European Union together instead of apart. But the new mass communications have provided a different template.
The idea obviously was that once the crisis came the wise men of Europe would meet and a closer union would be developed. This was supposed to happen, perhaps, with relative ease. It happened quickly after World War I with the development of the League of Nations. The crisis and military convulsion of World War II led to a radical reshaping of the world's economy that included the UN, IMF and World Bank among other global, financial facilities.
But this time, chaos has not produced order, not yet anyway. Something has gone wrong on the way to a more perfect union. Here's a good description of the reality that has supplanted the intended scenario – one taken from an OpEd article posted at Eurasia Review (News & Analysis), written by journalist Kia Mistilis. It's entitled Greece On The Verge:
On June 29, the Greek parliament ignored the huge protests in Syntagma Square and approved the austerity program. But the Greek movement that has emerged to challenge this unpopular loan package is not going away.
Although many Greeks were willing to accept the necessity of addressing the national debt, they reject the IMF approach of socializing the losses and privatizing the gains, which puts the burden of unsustainable debt repayment squarely on the people. Epaminondas Marias, associate professor at the University of Crete, argues that even if Greece doesn't default, and it almost certainly will, its debt will be 120 percent of its gross domestic product by 2020. Such a national debt is clearly unsustainable at a 16 percent interest rate, compared with 6.2 percent before the bailout.
The austerity measures, conditional with the loans, are so severe that they have produced a deepening social crisis. And the worst is yet to come. Since the bailout was introduced in May 2010, unemployment has risen 40 percent bringing the national rate to 16 percent and 42.5 percent for youth. The basic wage has been cut from 700 to 550 euro per month, the sales taxes rose to 23 percent, and the economy shrank 4.5 percent. –
The Greek protest movement, formerly energized by leftist parties and trade unions, morphed into a people's movement galvanized by opposition to the severe austerity imposed by the troika of foreign lenders. Three weeks of peaceful protests leading up to June 15 general strike marked a watershed in Greek history: not only did crowds gather in central Athens day and night in numbers upwards of 250,0000, peaking at 500,000 on June 12, the demonstrations were consciously unaffiliated politically and a magnet for thousands of first-time demonstrators, from young children to grandparents.
The change was partly catalyzed by the Indignados (Indignants) of Spain, whose call to action sparked a wave of anti-austerity demonstrations, bringing hundreds and thousands of people to the public squares of Madrid and Barcelona from May 15. These protests quickly spread to Greece via Facebook and the Indignados' challenge to their Mediterranean cousins.
We believe in this narrative. We have no reason not to. For reasons that we have been describing for numerous years and in here in DB's pages as well, the elites have begun to lose control of the entire European promotion. The dominant social themes that they used to control the course of history – as they consolidated their "new world order" – are far less effective in the 21st century than the 20th.
The Bloomberg article itself makes the dilemma clear. Facing unexpected difficulty in creating a greater union, the choices facing the EU grow starker. "The (EU] hangs in the balance. Germans are seething over having to help what they view as Greek freeloaders. Greece's trade unions are striking, and citizens are rioting over measures that will increase taxes, reduce pensions and slash incomes. Markets are gyrating amid fears that the conflict between Europe's core and periphery will lead to financial disaster."
The Bloomberg writers do not, of course, EXPLAIN the reasons for this continent wide disruption, but to us it is obvious. People, animated by the economic crisis turned to the Internet for information and what they discovered has helped galvanize a considerable resistance.
Of course, it is true that such resistance has occurred before; Argentina comes to mind. But over this past decade, resistance to the typical IMF package of higher taxes, government cutbacks and public selloffs of government properties, have become increasingly notable. Greece's reluctance is notable only because it is playing out on a larger stage. Here is a Russia Today video today that captures the rising tide of Greek resistance: Bailout Battlefield: Greeks Fight Against Foreign Fiscal Take-Over.
Bloomberg – being Bloomberg – doesn't see it that way. The article blames the Greek crisis on the Greeks. "The Greeks, of course, bear the main responsibility for their predicament. They effectively lied their way into the euro, presenting deficit figures that were wildly understated. The country consumed far more than it earned and borrowed to make up the difference. Tax evasion is a national sport."
All of this is true; yet it isn't. The average Greek did not participate in the wild spending that took place after Greece joined the union. One can argue on good evidence, in fact, that this was the plan all along. We see it regularly with the World Bank, which apparently lends to despots to put the larger country in hock. The despot flees, the IMF offers funds to the new government in return for austerity measures and Western corporations buy national resources at fire-sale prices.
To claim the average Greek is responsible for his countries predicament is to ignore this malicious pattern. The Greek crisis was a preventable one. To be fair, the article does eventually cast the net of blame more widely, eventually snaring both Germany and France:
Greece's foibles, though, would not have led to a crisis without the help of Germany and France. They set the precedent when, for three years beginning in 2002, they exceeded the prescribed budget-deficit limits with impunity. What's more, France and Germany played the leading role in setting capital rules that encouraged German and French banks to finance Greece's profligacy, and then required too little equity to absorb the potential losses. Because of lax oversight of derivatives markets, regulators now have little idea where the losses will turn up if Greece reneges on its debts.
The solution? According to the article, one is simply for Greece to leave and default on its debts. This is dangerous for the larger union however, Bloomberg cautions. "Uncertainty about losses would very likely undermine confidence in European banks and in the governments that would have to bail them out. If Greece's failure led to a credit freeze, that would threaten banks with insolvency and cause losses for institutions that hold those banks' debts, including the money-market mutual funds entrusted with $2.7 trillion in U.S. savings."
The financial mayhem would put pressure on Portugal and Ireland and quite possibly lead to a chain reaction throughout Europe. Belgium, Italy and Spain might also follow Greece into default. The article thus proposes an alternative, one the writers admit is "only slightly less ugly and unfair."
What it suggests is that euro area, led by Germany and France, should assume much of the Greek debt, some US$495 billion and signal a willingness to assume the debt of Portugal and Ireland as well. This would doubtless entail a unified finance ministry, the Bloomberg writers admit.
So, here we see, once again a reassertion of the original plan. Out of chaos, order. The only responsible solution is deeper unification. The Bloomberg writers admit the solution is unpopular. "Risky as it may be, taking responsibility for Greece's problems is the least bad option for Europe. This is no longer about saving Greece. This is about self-preservation."
This is a predictable conclusion. But we ask – much as the Greek Indignados ask – self-preservation for whom? Brussels? The Eurocrats themselves? What exactly is worth preserving of the EU experiment, a profoundly anti-democratic process that has trampled on European civil rights while passing increasingly despotic regulations that affect every aspect of European lifestyles and entrepreneurship?
Can anyone make a prediction as to how all this is going to turn out? We have never made one, though in years past, we suggested that Europe's tribes might prove a good deal more intractable than people expected if the EU experiment began to sour. In fact that's just what has happened. We expect more of the same.
We do hope the EU unravels. Many other elite plans seem to be coming undone as the Internet Reformation continually unravels the 20th century's age of promotion. Global warming, the wars in Iraq and Afghanistan, even the war on terror itself, seem less effective these days. And while some have suggested otherwise, we believe the unknitting of the EU would be a big blow to the goal of implementing a one-world order.
The powers-that-be are fighting hard to sustain the EU. Offering one failed solution after another to stave off what seems inevitable, they are obviously playing for time. Perhaps the economy will strengthen or the big European banks will stabilize. This is the apparent hope. Their success or failure may may tell us a good deal about how vibrant elite strategies are in the modern era. The EU has thus become something of a bellwether for the new world order; there is more at stake than merely a regional consolidation.
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