This can only go on for so long. What can't work will eventually stop working.
And the sovereign debt crisis goes on, in an acute way. Angie's austerity policies can only make the immediate sovereign debt problem worse.
Economist Nouriel Roubini sees Portugal slipping into a Greek state of crisis, probably needing a writedown of the debt. (Roubini prophezeit Portugal griechische Tragödie Financial Times Deutschland [FTD] 28.01.2012) Portugal's interest rates on their bonds have spiked to clearly unsustainable levels. The Portuguese Prime Minister, who not long ago suggested that unemployed Portuguese citizens should consider emigrating to Brazil or Angola, seems to be hiding his head in the side, perhaps for fear of Angie's wrath.
Speaking at Davos, Roubini suggested that Greece might be leaving the eurozone within a year.
And it turns out that the Princess Angela von Merkel may be ready to impose Post Democracy 2.0 in Greece. According to the Financial Times, Angie wants to basically install a financial dictator representing the euro group (read: Germany) to have final say over the Greek budget and expenditures, with the power to override the democratically-elected government. (Though the current debt-collectors' Post Democratic 1.0 regime in Athens previously imposed by Angie is democratic only in a formal sense.) Peter Spiegel and Kerin Hope report in Call for EU to control Greek budget 01/27/2012:
The German government wants Greece to cede sovereignty over tax and spending decisions to a eurozone “budget commissioner” to secure a second €130bn bail-out, according to a copy of the proposal obtained by the Financial Times.Angie has lost it. "It" in this case being her sense for democracy.
In what would amount to an extraordinary extension of European Union control over a member state, the new commissioner would have the power to veto budget decisions taken by the Greek government if they were not in line with targets set by international lenders. The new administrator, appointed by other eurozone finance ministers, would take responsibility for overseeing "all major blocks of expenditure" by the Greek government.
"Budget consolidation has to be put under a strict steering and control system," the proposal reads. "Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time."
And since it is the rightwing parties in Europe who have been working nationalist themes for years in opposition to the European Union, this hands them one more political advantage. What Europe, the European Union and the eurozone need more than anything right now is to get Angie out of the
This is obscene:
Athens would also be forced to adopt a law permanently committing state revenues to debt service "first and foremost". ...Herr Reichenbach received the un-fond nickname in Greece of Third Reichenbach.
Greek voters have already expressed anger about EU attempts to assist in implementing reforms. Horst Reichenbach, the German national who heads an EU task force to assist Greece, was depicted in German military garb by leftwing Greek newspapers when he arrived last year.
And despite IMF General Manager's criticism of Angie's austerity policies this past week, the IMF is joining with Angie to further impoverish Greece and the Greeks:
Even before Germany circulated its proposal, the EU and International Monetary Fund had presented a 10-page list of "prior actions" Athens must implement before the new bail-out is agreed. According to a copy of the document, also obtained by the FT, Greece must cut an additional 150,000 government jobs within three years.Not so long ago, it was conventional wisdom that a depression could be a danger to democracy. And here is Germany proposing to set aside another major chunk of the superficial appearance of democracy in Greece for the greed of the banksters. This is just awful. And this to override a government that Angie insisted on installing just a few weeks ago for the main purpose of collecting debts for the banks.
From Angie's proposal itself:
Greece has to legally commit itself to giving absolute priority to future debt service. This commitment has to be legally enshrined by the Greek Parliament. State revenues are to be used first and foremost for debt service, only any remaining revenue may be used to finance primary expenditure. This will reassure public and private creditors that the Hellenic Republic will honour its comittments [sic] after PSI and will positively influence market access. De facto elimination of the possibility of a default would make the threat of a non-disbursement of a GRC II tranche much more credible. If a future tranche is not disbursed, Greece can not threaten its lenders with a default, but will instead have to accept further cuts in primary expenditures as the only possible consequence of any non-disbursement. [my emphasis]Hungary is not the only country in Europe in which democracy is under immediate threat.
Tags: angela merkel, eu, european union, greece, post-democracy