Tag Archives: Greek debt

2 Cents Worth On Life Its Ownself

We remove the cobwebs from the memory box and see what’s inside with a couple of side trips to the news of the day.

Ms. Rosen picked on the wrong group to slander.  It doesn’t pay to arouse those soccer moms around the country.  They certainly won’t take lightly to being told they haven’t worked  a day in their lives.   I am sure that most of them when they finally call it a day, late in the evening, feel like they have put in a pretty full day’s labor.  Not to mention those middle of the nights calls to duty for sick kids.   The boss might send someone home with work from the office but a lot of moms are told at bedtime that “oh, mommy, I have to have a model in the morning of Long Island, made from homemade paste”.  Guess who gets to work on that one.

Well, centrally planned and prepared flight operations didn’t work out too well this week for our good friends in N. Korea.  Seems that someone salted the bird’s tail.   Their Gulag will no doubt have a few more occupants by the end of the weekend. 

You note how hostile Greece has become to Germany over the last year or so because of the conditions required by them for the bailout of Greece debt.  They are even using cartoons of Merkel dressed up as a Nazi.  The Greeks spent themselves into oblivion without regard to worrying about ever paying back that cheap money they borrowed and the lush government handouts that so many of them received and they relished the “red tape” bureaucracy that created pointless and even harmful government jobs.  There is always a price to pay; there are always consequences for our actions.  If they were smart they would embrace the German dominance.  Heck, they should let the Germans run their country for a decade or so.  They are Germans after all and things would get sorted out.  Same is true with all those southern rim European countries–just become provinces of Germany or allow Proconsuls from there run things.  Of course that means the corruption would have to end and the pay for no work.   But they will muddle along being the permanent beggars of the Euro-zone.

Since the oral arguments in the Obamacare case there has been much mention in the news of the Marbury v. Madison case that established the principle that the Supreme Court could find a law of Congress invalid if it believed such law was contrary to the Constitution.  The facts of that case were quite convoluted and filled with conflicts of interests including such conflicts by the Chief Justice, John Marshall himself.  Marbury was a fellow who was appointed by Adams to be justice of the peace in DC along with many others and a number of Federal Judges.  They were all done at the end of Adams term and he issued to appointments literally at the end of his term.   They were the “Midnight Judges”The official document, a commission, was to be delivered to Marbury by the Secretary  of State, John Marshall but he didn’t get around to it.  Jefferson was sworn in and John Marshall was replaced by Madison who did not deliver the commission because Marbury was from the wrong political party.  Marshall got the appointment to the Supreme Court.  When Marbury sued Madison demanding that he deliver the commission because he was duly appointed and confirmed by Congress Madison still refused and the issue was joined in the Supreme Court.  The Court ruled that Marbury was right that the delivery of the commission was merely  a ministerial act and that Madison was obligated to deliver it.  But, but but, the Court then went on the rule that the underlying law which had authorized the appointment in the first place was un-Constitutional.  Marbury was right under the law but the law was bad.  He won the legal argument on his right to have his commission but then lost because the commission was Constitutionally invalid.  He never did get his appointment.  Jefferson lost the legal argument but won  the political argument.

Everyone remembers that Germany surrendered in May of 1945 to close the European campaign.  But what most don’t remember is that it was two more years before peace treaties were ratified by the US Senate with most to the Eastern European nations and the Allies at the Treaty of Paris.  This was in 1947.  The delay was caused by concerns with the Soviet take over of that area and that fact that Bulgaria, Hungary, Romania, Finland and Italy had all been allies of varying loyalty to the Germans.  In Romania there was no local support for the Communist party.  But that didn’t stop Uncle Joe.  He simply imposed communists from elsewhere or a few hand-picked ones and finally held “elections” in 1948.   Violence was the road to victory in that election.   It was strictly force majeur to take the country.  The Romanian’s central planning ran all the way back to Moscow not even stopping at Bucharest.   Communists from around the world supported this move.  Their position was that the Soviet control would prevent the Romanians from returning their bad ways of the past and would guarantee their “independence”.  Strange way to define independence.

The birth seed of the European Union began with a consortium formed after WWII by several of the Western European nations to control, regulate and set prices for steel, coal and electricity because they saw no other way at that time to pull themselves up from the ashes; this group included Germany and France.  Although Germany at that point really had no option but to sign whatever was placed in front of them.

“A single death is tragedy, a million deaths is a statistic.”  Joe Stalin.   www.olcranky.wordpress.com


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2 Cents Worth On Life Its Ownself

Rummaging around the corners of the mental attic we came across a few thoughts that only needed to be dusted off.  Maybe you’ll find  them worthy of a moment’s reflection or at least amusement.

It seems the European leaders are very good at having meetings and making announcements about plans to stabilize their Euro.  But have you noticed that the follow-up is pretty weak.  It seems so many of the deals never get actually implemented.  I mean there was a “deal” for the Greek debt about three months ago but no real money has changed hands and the Greeks haven’t yet satisfied the new loan terms.  Same is true with the alleged fund to back up the European banks and nations from almost a year ago.  The money hasn’t hit the table yet.  They seem to be good at having press conferences but not good at the follow-up execution of their plans.  I suppose Nero is their example.  After all Rome was eventually re-built.

Speaking of Greece, it is interesting that it is the private lenders, bondholders, of Greece that are having to take the 50% haircut. The various European governments and their central banks aren’t taking any loss on their bonds.  Makes one wonder exactly who in the future will be willing to loan to the Greeks.  It will probably be the European governments by hitting their taxpayers.  At least as long as those taxpayers believe the cost is worth it to keep the peripheral countries in the Eurozone.  The French and Germans may well decide it isn’t worth it.  Hmm, wonder is some day most of US citizens will feel the same way about California, Illinois and New York.  Why is it again we need to send a disproportionate amount of our tax money to those States while they never rein in their budgets?

I haven’t heard Tim Tebow ever say he believed the Lord gave him or his team a victory contrary to many news reports.   All I ever heard him say was that he thanked the Lord for a victory–quite a difference.

If you ever doubt the importance of the rule of law and the importance of which law applies then take a look at the Greek loan negotiations.  One of the requirements of the European banks and IMF is that English law applies to the new loans, not Greek.  Consistency and fairness regarding dealings among citizens in their private affairs and between citizens and their government are very important and our Anglo-Saxon common law is the best yet.  Far better than the many alternatives over the years tried by others. It is recognized even by those hostile to any vestige of English culture or heritage.

With the ongoing debates about the total US debt and the US tax code, we still like the idea promoted here before of making the Feds give a complete line item of the expense categories of the Federal budget on the back of your tax return.  Then you could check which programs you were willing to support and pay for.  The list would have military, HUD, welfare, EPA, etc.  Those that are real greenies could devote all their taxes to the EPA and those that don’t like it wouldn’t give it a dime for example.   Same with the military and all areas of government expenditures.  Its our money after all and I can’t think of a good reason why we shouldn’t have more input into how it is spent.  

During the political season (of course these day’s when does that season ever stop) it would be good if the politicos and the pundits would recall some sound advice from long ago.  When the government and its laws become too large and cumbersome then the politicians running that government are much more inclined to submit to the seduction of interest or resentment.  It seems BO in particular is into the resentment game and the interest game.  Why is it good for the body politic to have one large segment of the population resenting another large segment?  It would seem that is the perfect formula for extreme discord and eventually dis-union.  After all why expect one interest group to want to work with an0ther that they resent?  That resentment appeal is indeed a seduction and like all seductions a dangerous game to play.

In a society where the goal is equality of outcome,  history would unfortunately teach us that all that will produce is equality of servitude.   To achieve that equality of outcome always requires the blunt force of punitive measures by the government in charge.   There are no exceptions to that.  Why do you think Obamacare has criminal sanctions for those who don’t follow its mandate?  If you don’t report on the IRS forms correctly your insurance you will be guilty of filing a false document with Feds.  Don’t take my word for it, look it up for yourself; that is if you can find it in the gazillion criminal laws on the Federal books. 

What are the Scots thinking?  Do they really believe they will be better off as an independent country?    They are a great people with a proud history even if a turbulent one over the centuries.  Even the Romans find them so difficult to deal with they built Hadrian’s Wall at the border.  Whatever their cultural disputes with the English they will be worse off on their on.  They and their English brethren have survived many a hardship together and they have collectively advanced themselves immensely over the years.   They should think long and hard about what they will lose if they go it alone.  There will be no more pounds flowing from Whitehall to the north and I am not sure the world is beating at their door to buy Scottish goods and services. 

We have too many federal laws especially when you include all the regulations of our various agencies and bureaus of government; there are literally millions of them.  We need less laws and not more to fix our economic affairs.  I love the old Roman approach to new laws.  In the days before the Caesars the proponent of any new law would go before the assembly to offer it with a rope around his neck.  If the law wasn’t approved the innovator was instantly strangled with his own rope.  That would sure make politicos think a bit before they shot off their mouth about some new proposal.  Boy, makes you nostalgic for the old days.  www.olcranky.wordpress.com

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2 Cents Worth On Life Its Ownself

A few thoughts to ponder during the Holiday Season and ideas of the inquiring mind about the current state of affairs.  Buckle up and take the ride.

Greece has been much in the news lately because of their debt problems stemming from their very generous welfare state and highly regulated economy.   They are in a death spiral at the moment and trying to right the ship, or at least so they say.  There are some of us old enough to remember a little history about how they got to this point.   After the War most of Europe made substantial progress and improved the economic situation greatly all the way into the ’70’s.   Greece, Portugal and Spain were the noticeable laggards.  Their economies were third world during the period.  The European community was formed and the free trade zone established during this period which ultimately lead to the Eurozone with the Euro currency.   Greece wanted in badly in the ’70’s but lots of Europe was skeptical but they did want the whole nine yards and all of Europe to be in the economic union.   Greece couldn’t qualify on its own merit so it was granted special subsidies to be a member.  (No one ever accused the Greeks of being bad bargainers).  It was a great deal for Greece and the rest of Europe hoped it would be a good deal down the road for everyone.   Shortly after Portugal  and Spain applied for membership having ended the authoritarian reigns of Salazar and Franco. 

They were no bargain but again “Europe” wanted everyone in the deal because it would benefit all, at least that was the belief.  Guess who raised the most objection to them?  You guessed it, the Greeks.   They were already running deficits and their economy was still lagging behind everyone else but they thought the Iberians were too much of a load to carry.  To induce the Greeks to approve the addition, the rest of Europe again granted special privileges (subsidies) to the Greeks for them to go along with the Iberian additions.   With the extra money in their pocket for doing nothing more than saying yes, the Greeks were happy to welcome them in the early ’80’s.  We all know how that has worked out.  The Eurozone with the Euro came into existence finally in the late ’90’s.  The Greeks continued to have a bloated public payroll, low productivity per worker and huge deficits.  Others are having to step in and pay off the debts for the Greeks for their profligacy and the Greeks riot in the streets about how unfairly they are being treated!   Funny, I was always taught that whoever pays the Piper gets to call the tune.

Speaking of our friends in Europe are you getting as confused as I am about the way they intend to fix their debt problems.   We have the EFSF which is the European Financial Stability Fund that was is going to get money from somewhere; they can’t seem to articulate exactly where.  Then we now have the ESM, the European Stability Mechanism which is going to add more money to the bailout pot.  New ideas seem to emerge every week.  Will the ECB (European Central Bank) simply print up new money like our Fed does for its bailouts?  There has been talk of some authority, as yet not clearly specified, that will issue bonds and then loan that money out to the needy hands.  Maybe I am just not smart enough to understand the thinking of all those European “smartest guys in the room”.  I do know it all boils down to the Germans because they are the hardest working ants in the field and the most frugal.  Can you blame them for asking what they are getting out of all this?

You all remember the story of Robin Hood.  The complaint was tha the local Sheriff of Nottingham was in cahoots with some of the local big wigs and stealing money from the public coffers.  Am I the only one who has ever wondered why Robin Hood didn’t just go after the evil Sheriff and leave the others alone.  He ended up stealing from anyone he believed was involved in wrongdoing without trial or proof and then gave the money to his preferred special interest group and built a political machine.   Had the bad Sheriff merely been replaced with another Sheriff that had another coterie of cohorts after the same bag of money?  Was he really a hero or just another wannabe dictator?

I don’t get the Payroll Tax reduction for one year.  It will add up to about $80 per average family per month for the next year.  It is like the $600 check most of us got back a few years ago and the cut we’ve had this year.  That amount spread out over a year just doesn’t motivate lots of renewed spending by consumers.  I mean look at the economy for this year.  Has that cut of 2% in the payroll tax boosted the economy this year?  A year flies by really fast.  You reach your own conclusion.  I love all lower taxes but cuts need to make sense in a broader picture.  We would all love to have that extra 80 bucks a month but that won’t cause us to go buy a pick up truck; maybe we’ll do a couple of trips to Appleby’s with the family.  

After all the sound and fury of the last year the fact is that the National Debt is higher still and going up like a rocket.  All the talk about cutting hasn’t happened yet and the so-called cuts are merely reducing the amount of the growth of the debt which is currently projected be 44 trillion in ten years.   Maybe we are just Greeks writ large.   Everyone can’t live on the Federal payroll directly or indirectly forever.  Someone has to actually work in the private sector to create real wealth and money.  The Government doesn’t create wealth, it takes wealth for allegedly the common good.   As it grows the private sector shrinks and soon there won’t be anyone to tax if we keep on the present road.

“I desire what is good; therefore, everyone who does not agree with me is a traitor”.   George III www.olcranky.wordpress.com

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French Fry Euro And Zone

The news today is filled with allegations that Sarkozy has made a direct threat to abandon the Euro and to withdraw from the Euro zone confederation.   Denials from the Germans, Spanish and “aides” to “Sarkozy have spewed forth in the media ether already.  But the European markets and our own are reacting with alacrity to the putative pronouncement.  If you know a bit of French history and European history it would come as no surprise whatsoever that the French would abandon their partners when crunch time comes.

It is another question altogether whether or not the EU and central bank there should offer such a bailout package for the Greeks.  A very cogent and moral argument can be made that the Greeks should be made to suffer the consequences of their own folly.  The debate is really not much different, if at all, than the one we endured during the fall of ’08 about whether we should bailout AIG, Fannie and Freddie, GM and Chrysler and then a group of large banks.   Pundits, economists and great thinkers can and will debate the efficacy of that program for decades to come.  Not allowing failure to fail is certainly not the format for a vigorous free market system.  If they had all gone under there would have been lots of pain but most of it would have been borne by those who were running or working for those companies or doing business with them.  Those were all choices made by those various groups.  Depositors could have been protected for far less than the cost of the TARP program and the Stimulus bill only leaked away like sprinkling drops of water into the ocean.  We still lost 2.5 million (or calculate your own number) since that time anyway.  Except for a handful relatively speaking of construction jobs here and there who the heck has benefitted from any of that money?  The Europeans can bailout whoever they wish, it is their deal not ours.   We are NOT all in this together.   Maybe the Europeans haven’t learned anything from our experiences so far.

I am not mad at the French for their position but find it typical of their view of partnering with anyone.  Many individual Frenchmen are grateful people.  You can go to the coast of Normandy today and talk with the older folks and many will heap praise on the Americans and British for the invasion and their liberation for the Nazis.  But as a nation they are not grateful and always have the attitude of what is in it for them.   Thus is has ever been so.  Certainly since the days of Talleyrand and the end of the Napoleonic era they have always sought only what is in their interest in their dealings with all parties including those who are their allies.   Loyalty is not their long suit.   Talleyrand astutely observed that nations do not have friends but only interests to be protected.  

In international relations and the diplomatic world that is a realistic policy and not necessarily to be condemned.  It matches well with the Realpolitk of Bismarck from the 19th century and the diplomacy of Kissinger during the Cold War.   It is not that they are looking out for their own interest that is bothersome it is the hypocrisy and arrogance they deploy in their messages to the world that boggles the mind.  They have a history of bugging out when the going gets tough.  They never gave much of a thanks for the British blood shed in Flanders fields for their protection during WWI nor did they heap praise on the American Expeditionary forces that closed the military deal against Germany.  During WWII they quit when they still had millions of men under arms and made their peace with the Germans and split France into Vichy and occupied France.  Those Vichy French killed the first American troops to storm the beaches in North Africa a couple of years later and Churchill had to send the British navy to sink a goodly portion of the French fleet at Oran because they didn’t have the guts to bring their ships to Allied ports.  All those decisions they thought were best for them at the time made.

After the War and the creation of the United Nations and NATO then French looked for the first opportunity to dump their friends again.  De Gaulle withdrew the French from the NATO alliance because he thought he could win better terms dealing with the Soviets without the encumbrance of allies.   Maybe so, maybe not but you don’t abandon your friends and those who helped you when the bullets were flying.  Now they face difficulties with their EU partners.  Whatever decision they make you can rest assured will only be examined through the prism of what they believe is in their best interest alone without regard to any commitment made to others.  Again they are loyal only to themselves.  Sacrifice is not a word often used in their vocabulary.   Vive la France!

“the mob, those political animals need organization, which means simple orders and chiefs.”  De Gaulle.   http://www.olcranky.wordpress.com

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Greeks Greased Their Own Slide Into Debacle

It is painful to watch such an ancient cultural center as Greece fall so low.  Today they are the beggars of Europe.  Without the alms from Germany and others they will default on their debt obligations  and their economy will melt into mess hard to imagine.  They don’t have enough resources or innovative businesses to sustain themselves very well without participating in the broader economy of Europe but that will be hard to do after default because everyone they deal with will demand COD terms.  Simply put they won’t have the cash and will have to deal internally for almost all their needs.  They can’t supply all those needs from food to high technology with their own resources.

Once they were the epicenter of economic power, cultural development and even military might.  During the 4th and 5th centuries BC they dominated the world stage.  This was the era when they thwarted the mighty Xerxes of Persia and gave the world Socrates, Plato and Aristotle and then later Alexander the Great.  Even after their might militarily and economically had waned they still exerted a tremendous influence over the sciences and cultural matters.  They people had spread around the Mediterranean Sea and they were always the local thinkers, teachers academics of the time.  Though their actual control of Alexandria in Egypt was brief they still held sway with Galen (medicine), Strabo (geography) and Ptolemy (astronomy) several centuries later.  Even the Gospels are replete with references to “Greeks” and always as someone to be admired.  In Roman times it was considered the mark of a truly educated man and sophistication if one could speak Greek.

When the Roman Empire fell they mostly went into the backwaters of history for several centuries.  Later they emerged as one of the principle bulwarks of Europe against the constant encroachment of the Muslims into Europe proper.  That time lasted for almost a thousand years.  Even the great Lord Byron went there to help the Greeks in their struggles because he so admired their cultural heritage.  They were mostly pawns during WWI and WWII because of their diminished standing in the world.  But after WWII they became a battleground between the West and the Soviets.  Harry Truman declared that was the limit of Soviet expansion.  He was determined that they would not overwhelm Greece as they had Poland, Hungary, Romania, Bulgaria and the eastern portions of Europe.  That was the first major battleground for the OSS and then the CIA after WWII.  The CIA had many teams parachuted into Greece and Albania in an effort to hold back the tide of Soviet advance.  The Greeks were split pretty badly during this time between those who favored a Socialist government and those who didn’t.  We kept the Soviets out and prevented outright control from falling into their hands but the local government maintained and very strong socialist agenda and the socialist dominated their governments for decades.  The socialist still play an important and determinative role in the Greek government.

Due to that socialist view the Greek did indeed embark on many socialists programs and they were somewhat propped up by Soviet money and trading agreements for decades.  After the fall of the Soviet Union there was a serious re-thinking by the Greeks about their own future.  It clearly could no longer be an outright socialist state because that philosophy had crashed in flames.  It could provide no future help of any significance to the Greeks.  So they looked West to Europe.  Their new best friends.   You may not recall but it was not an easy sale to many in Europe to admit the Greeks to the European Union and the Euro economy in the first place.  Especially the Germans were reluctant.  They were worried that the socialist legacy ran deep and that the Greek economy was too dominated by the State, there were too may pensioners, too my feather-bedding jobs and productivity was very low.  The Greeks gave mea culpas and pledged to reform and were admitted.

Guess what the Germans were correct two decades ago.  Greece didn’t have enough people working in the real economy to support the favored programs of the “reformed” socialists.  Greece floated more and more debt to sustain its view of a welfare state and then even lied by cooking its books.   Everyone can’t be a clerk, bureaucrat, pensioner, fireman, policeman and some sort of regulator getting envelopes filled with cash to authorize a permit that is required for almost everything in that centrally controlled economy.   Sooner or later creditors begin to ask questions about the ability to repay the money loaned to support the public sector.   Since they share a currency with the others in the Euro zone that makes it a problem for them also.   We have gone through our own problems lately and certainly by now understand the implications of abandoning the concept of moral hazard for bad decisions.  Will the EU be better off helping out Greece or would it and Greece be better off letting them default and suffer the consequences for a generation?  Has all our efforts with bailouts proven to be such a tremendous success that others would want to emulate it?

We should hold dear the lessons and virtues of the Classical Greek scholars and they establishment of the basic frameworks of a democratic form of government.  We also need to watch these events unfold carefully.  Central planning, buying voter support with government handouts, shrinking the private sector and squelching private enterprise has brought Greece to this stage.  We should also use this recent history there as a warning signal for our own future economic policy and concentration of power in a central authority.

The Germans would do well to resort to the Realpolitik of Bismarck.  It would be best for them and Europe and the world as a whole.   http://www.olcranky.wordpress.com

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