Tue Jul 12th, 2011 at 03:26:22 AM EST
There's this old Nasreddin Hodja tale, where a villager sees Nassredin, standing sadly by the side of the road and asks him "What's the matter Hodja?". "I'm very upset my friend" he replies, "I have been teaching my donkey how to manage without eating, and just as he was getting the hang of it, he died!"
This was the story that came to my mind as I was reading about the great progress that the Greek economy has been making by following the ECB / EU Commissars' guide to
bankruptcy market creditworthiness:
A deeper-than-expected recession caused Greece's central government deficit to widen by almost one third in the first half of the year, widely missing an interim budget target under the country's bailout plan, the finance ministry said on Monday...
... Net budget revenues dropped 8.3 percent year-on-year to 21.81 billion euros, compared with a 25.08 billion euro target. Spending before payments on the country's debt increased 4.5 percent to 25.62 billion euros, 7.1 percent above target.
The ministry attributed the revenue shortfall to a more severe economic slump than had been anticipated, and one-off road taxes that boosted revenue in the previous period
Promoted by DoDo
Note that the ministry is attributing the shortfall on reality not being kind enough with its voodoo BS projections, underwritten by the great financial minds at the ECB and the EU Commission I should add, and on something it already knew would happen well before it made the projection. This narrowly misses beating the Greek government's own record in uninsightfulness, that occurred last spring when the then Finance Minister Giorgos Papakonstantinou acknowledged that he was having a hard time cutting 500 million Euros from the unemployment agencies as troika and FM experts failed to anticipate that, as unemployment skyrocketed, unemployment benefits would increase as well.
I won't even start commenting on the performance of the EPP/PES leadership in fomenting a world-crisis from a minor glitch. The measures that the eurogroup is apparently coming up for Greece (or whatever) are a year too late - they would have made things a bit easier early on in 2010. Now it won't be much help, especially since the powers that be seem to have learned exactly nothing at all from the Greek fiasco, and are pushing Italy down the same austere road to perdition:
Italy's coalition government is coming under concerted pressure at home and abroad to calm market nerves and push its 40bn austerity package through parliament without delay
As Albert Einstein said "insanity is doing the same thing over and over and expecting different results". Or is there a method to this madness? Is all this principally, if not solely, not a crisis management issue but really a political project? Shock therapy for the EU, one country at a time? Well, yes - see David Harvey:
"What's going on, both in Europe and the US, is a political project, not an economic necessity. And the political project is about feathering the nests of the very, very rich, at the expense of the very poor..."
Note that even if a viable-looking facilitation of the Greek debt is achieved, the Great Greek Asset Fire Sale, which will involve selling off an asset every ten days for the rest of the year, under terms that look downright colonial, would still be operative. As would the cuts in public services, pensions, wages, labor rights etc.
Democracy's chemical blossoms
Meanwhile, after the 2863 canisters of expired tear-gas dropped in Syntagma Square - just on the 29th of June, and the unprecedented police-violence against everyone in Athens' center that day, the Orwellian-named "Citizens' Protection Ministry" through its leadership, applauded the measured response of the police to provocations, and condemned pretty much everyone that demonstrated that day. The same endorsement of the Mubarak-like police methods was voiced by the Prime Minister himself. Outside of government things were vastly less congratulatory... Thus and in the same vein, the government with the help of the Mayor of Athens is preparing to evacuate the camp in Syntagma, as it is distressing to the tourists' aesthetic appreciation of Athens and creates a "bad image" for the city and impedes commerce. This might turn out to be less easy than they imagine, summer or no summer...
The thing is that the members of this government and the parliamentary team that supports it, are not safe to walk around their cities anymore, heckled and booed as they are - when they don't suffer the indignity of an egg or a pale of yogurt on their face, perhaps worse - every time they appear in public. This has led the government to react by blaming SYRIZA, the radical left party, as well as assorted other parties and movements for organizing these "attacks", in an attempt both to blunt the harsh criticism from the left and taint these actions as something a minority would do. Unfortunately for the government, this is not what the polls show: 5-3 those asked approve these "attacks", while the fuss the very unpopular Socialists (reached 16% in the latest poll, not correcting for undecideds and non-voters) are making against SYRIZA is, according to pollsters, boosting its popularity. As the conservatives are leading at just 17,5% it seems that as things grow angrier and more depressed, pretty soon of not already there won't be a mainstream party in a position to be elected to govern any more.
Finally a great resource from the German Rosa Luxemburg Foundation:
Greece: 20 popular fallacies concerning the debt crisis
... echoing much of what I've been stressing here and more, tailored at German audiences. Stuff the EU in general needs more of, I think....