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Nederlog

July 13, 2015
Crisis: All Greeks, Greek debts, Guardian, Twitter, Europe, China's Turbulence
  "They who can give up essential 
   liberty to obtain a little temporary
   safety, deserve neither liberty
   nor safety."
 
   -- Benjamin Franklin
   "All governments lie and nothing
   they say should be believed.
"
   -- I.F. Stone
   "Power tends to corrupt, and   
   absolute power corrupts
   absolutely. Great men are        
   almost always bad men."
   -- Lord Acton















Prev- crisis -Next

 Sections

            Introduction
1. We Are All Greeks Now
2. 
Greek debt crisis: Tsipras resists key bailout measures
     after 15 hours of talks

3. The Guardian view on the Greek negotiations: out in the
     cold or in chains

4.
#ThisIsACoup: Global Anger Erupts Over Germany's
     Harsh Austerity Demands

5. Killing the European Project
6. China's stock market turbulence is over? Don't count on it


This is a Nederlog of Monday July 13, 2015.

This is a crisis blog. There are 6 items with 6 dotted links. Most are about Greece,
and all reviews were written by me on Monday morning:

Item 1 is about an article by Chris Hedges, about Greece (I partially agree, partially disagree); item 2 is about an article on The Guardian that was written before there was
an agreement (that I also heard first on 10.00 o'clock this morning); item 3 is a review of The Guardian's view on the Greek negotiations (again from before the agreement); item 4 is about the "global anger" that expressed itself in tweets (which I am sorry but I can't take serious); item 5 is about Krugman's point of view; and item 6 is the only item not about Greece but about China, that seems to have weathered a considerable crisis in share prices that wasn't paid much attention to, given the Greek events.

As I've indicated: This Nederlog was written in the morning of July 13, in the course of which I received the news that there is an agreement between the EU ans Greece (which still has to be accepted by the Greek parliament). I can't change anything about that, except promise you that there will be another Nederlog tomorrow.

1. We Are All Greeks Now

The first article today is by Chris Hedges on Truthdig:
First about the title: Like We All Were Charlies when people got murdered in France, and We All were LGBT-people out of feelings of solidarity, and We All were blacks while we are whites because We Want To, and We All are anything we are not, simply because a prominent journalist intones "We Are All SoAndSos" and We-All agree because we lack the abilities to think rationally and be ourselves, but can fondly and proudly pretend that we are what we are not?!

But no, Chris Hedges doesn't say that "We Are All Greeks" in the article, and I don't know he wrote the title - but yes, I strongly dislike all this posturing with identities that we know (or should know) we have not.

What Chris Hedges does say starts as follows:
The poor and the working class in the United States know what it is to be Greek. They know underemployment and unemployment. They know life without a pension. They know existence on a few dollars a day. They know gas and electricity being turned off because of unpaid bills. They know the crippling weight of debt. They know being sick and unable to afford medical care. They know the state seizing their meager assets, a process known in the United States as “civil asset forfeiture,” which has permitted American police agencies to confiscate more than $3 billion in cash and property. They know the profound despair and abandonment that come when schools, libraries, neighborhood health clinics, day care services, roads, bridges, public buildings and assistance programs are neglected or closed. They know the financial elites’ hijacking of democratic institutions to impose widespread misery in the name of austerity. They, like the Greeks, know what it is to be abandoned.
I agree, though - being very learned in logic - I'd like to point out all this would also be true if the Greeks did not exist. The explanation is this (in one paragraph - and there are many longer ones):
The Greeks and the U.S. working poor endure the same deprivations because they are being assaulted by the same system—corporate capitalism. There are no internal constraints on corporate capitalism. And the few external constraints that existed have been removed. Corporate capitalism, manipulating the world’s most powerful financial institutions, including the Eurogroup, the World Bank, the International Monetary Fund and the Federal Reserve, does what it is designed to do: It turns everything, including human beings and the natural world, into commodities to be exploited until exhaustion or collapse. In the extraction process, labor unions are broken, regulatory agencies are gutted, laws are written by corporate lobbyists to legalize fraud and empower global monopolies, and public utilities are privatized. Secret trade agreements—which even elected officials who view the documents are not allowed to speak about—empower corporate oligarchs to amass even greater power and accrue even greater profits at the expense of workers. To swell its profits, corporate capitalism plunders, represses and drives into bankruptcy individuals, cities, states and governments.
Well...yes and no. Yes, corporate capitalism (which seems a polite way of talking about fascism, with which it shares the definition [1]) works like that. But no, there are at least two things Chris Hedges does not mention:

First, there also is an alternative form of capitalism, that may be called regulated capitalism, that - more or less - did work from 1950-1980, and was abandoned for ideological reasons by Clinton and Blair (both of whom got to be millionaires, and both of whom still are widely listened to), and second, in spite of all the sufferings the Americans poor are exposed to, it seems that the majority of Americans that doesn't have to work for a minimum (i) doesn't care much for the sufferings of those poorer than themselves
(on average: there are exceptions), and (ii) anyway doesn't know much about politics and economics (on average: there are, again,  exceptions), and (iii) still in large majority follow and believe the main media (which are not informing but propagandizing them). [1a]

And while I am rather sure that Chris Hedges also knows these things, he doesn't mention them, I suppose mostly because this would dampen his rhetorical force.
I agree it would, but then I think myself it is better to be guided by (probable) facts [2] than by rhetoric (and you may disagree).

Also, while I could have commented a lot on my realistic corrections, I will only make a theoretical case for regulated capitalism, simply because I think that is important. Basically, there are two points:
  • Regulated capitalism, that is, a capitalism that was national rather than multi-national, and that was constrained by laws and regulations, has worked and has brought welfare to broad sections of the American and Westeuropean populations, certainly between 1965 and 1980. (And I was there.)
  • It has been abandoned by greedy multi-nationalists, but unlike Soviet and Chinese socialism, that were both political totalitarian dictatorships much rather than socialistic economies, it did work rather well and for many.
And while I am not saying this is a strong defense, and indeed do not much like capitalism [1a], the facts that (i) it did work in practice, also while preserving personal liberties, and (ii) it did increase the incomes of large parts of the populations which lived under it, are quite important, especially since "The Really Existing Socialism" of the Soviet Union and Communist China did not work in practice, and did not preserve personal liberties, and also did not increase the incomes of large parts of their populations other than in small amounts.

Besides, another part of this theoretical defense of regulated capitalism is that humanity has really tried but three political and economic models the last 200 years, on any large scale: Regulated capitalism (roughly: from 1946-1980), unregulated capitalism (before 1930 and after 1980), and totalitarian socialism (where the economy was basically owned by the leaders of the communist party).

And my points are not that I (and others) cannot think of systems that are better: my points are that alternatives have not been tried on any large scale, and that trying to do so is both quite difficult and quite risky.

Back to Chris Hedges. I selected four smaller bits (from three pages). First, there is this:

The system of unfettered capitalism is designed to callously extract money from the most vulnerable and funnel it upward to the elites.
Yes, although I would have preferred "unregulated" for "unfettered", indeed because it suggests that regulated capitalism was better (or at least: less bad
and less unfair).

Next, there is this:

The corporate dismantling of civil society is nearly complete in Greece. It is far advanced in the United States. We, like the Greeks, are undergoing a political war waged by the world’s oligarchs. No one elected them. They ignore public opinion. And, as in Greece, if a government defies the international banking community it is targeted for execution. The banks do not play by the rules of democracy.
Yes, but it is not just the banks: It is also the leading politicians, quite a few of which were elected. And this makes it more problematic, also because few who still have properties they may loose will go for "mass protests".

I am willing to agree with
Chris Hedges that is a sad fact, but it is a fact.

2. Greek debt crisis: Tsipras resists key bailout measures after 15 hours of talks

The next article today is by Ian Traynor and Jennifer Rankin on The Guardian:

This starts as follows:

A marathon overnight negotiation between Greece and its creditors remained unresolved on Monday morning after European leaders confronted Alexis Tsipras, the Greek prime minister, with a package of austerity measures which entailed a surrender of fiscal sovereignty.

A weekend of high tension that threatened to break Europe in two climaxed on Sunday at a summit of eurozone leaders in Brussels where the German chancellor, Angela Merkel, and the French president, François Hollande, presented Tsipras with an ultimatum.

The ultimatum – debated over more than 15 hours – entailed a series of draconian measures as the price of avoiding financial collapse and being ejected from the single currency bloc.

Tsipras acquiesced in most of the fiscal rigour demanded of him in four pages of summary instructions drafted by eurozone finance ministers.

But as I said in my introduction: Meanwhile, there seems to be an agreement (which still has to be passed by the Greek parliament, but these will probably pass it).

I don't think the agreement is fair or honest, and indeed there is this:

Social media sites throbbed with outrage. The hashtag #ThisIsACoup soared to the most trending in Europe, in Greece but also in Germany where Der Spiegel described Berlin’s demands of Athens as a “catalogue of horrors”, and to the second-highest trending worldwide.

In what a senior EU official described as an “exercise in extensive mental waterboarding” to secure Greek acquiescence to talks on a third bailout in five years worth up to €86bn (£62bn), Merkel and Hollande had pressed for absolute certainty from Tsipras that he would honour what was on offer.
There is more below, in item 4.

3.
The Guardian view on the Greek negotiations: out in the cold or in chains

The next article today is by Editorial on The Guardian:

This starts as follows:
The Greek crisis began like the proverbial cloud that was no bigger than a man’s hand and has grown into a perfect storm which has shaken Europe to its foundations. Regardless of the final outcome of the negotiations, what unfortunately can be said with certainty is that the union’s fault lines have all but burst under the pressure.

Between France and Germany, between north and south and east and west in the union, and even within nations, there are now profound differences, only potential before, which it will take a long time to resolve. The past few days have seen Paris commit itself to keeping Greece in the euro and the union in a way which puts President François Hollande on a collision course with hawks in the German government, headed by the finance minister, Wolfgang Schäuble. France’s mentoring of Greece as that country made its own final proposals did not seek an easy or soft arrangement, but nor did it envisage Greece’s reduction to the status of a debt colony, not too different from the conditions once imposed on Egypt and China in the imperial era, with foreigners in controlling positions in its economy.

There is considerably more in the article, that was written before the news of this morning that there is an agreement.

4.
#ThisIsACoup: Global Anger Erupts Over Germany's Harsh Austerity Demands

The next article today is by the Common Dreams staff on Common Dreams:

This starts as follows:

A list of draconian new austerity demands handed to the Greek government in Brussels Sunday ignited a global backlash against Germany, German Prime Minister Angela Merkel and finance minister, Wolfgang Schaeuble.

#ThisIsACoup became the top trending hashtag on Twitter worldwide - and is #1 in Germany and Greece.

The tag was attached to tens of thousands of angry comments denouncing Germany's aggressive demands that the Greek parliament pass new severe austerity laws within days to raise taxes, privatize public assets and cut back on pensions.

Paul Krugman, the Nobel laureate economist, helped promote the hashtag it on the New York Times website:

"This Eurogroup list of demands is madness. The trending hashtag #ThisIsACoup is exactly right. This goes beyond harsh into pure vindictiveness, complete destruction of national sovereignty, and no hope of relief. It is, presumably, meant to be an offer Greece can’t accept; but even so, it’s a grotesque betrayal of everything the European project was supposed to stand for. "

Well... there is a little more on Krugman in item 5, but there seems to be an agreement (on Monday morning, when I write this), and - I must say - I really dislike Tweets and Twitter, though I accept it is the ideal medium for people who only seem to be able to grasp slogans of maximally 140 characters.

In case you are interested, there are a number of Tweets in the article. [3]

5. Killing the European Project

The next article today is by Paul Krugman on The New York Times:
This starts as follows:

Suppose you consider Tsipras an incompetent twerp. Suppose you dearly want to see Syriza out of power. Suppose, even, that you welcome the prospect of pushing those annoying Greeks out of the euro.

Even if all of that is true, this Eurogroup list of demands is madness. The trending hashtag ThisIsACoup is exactly right. This goes beyond harsh into pure vindictiveness, complete destruction of national sovereignty, and no hope of relief. It is, presumably, meant to be an offer Greece can’t accept; but even so, it’s a grotesque betrayal of everything the European project was supposed to stand for.

Can anything pull Europe back from the brink?
(...)
Who will ever trust Germany’s good intentions after this?

I say. It may be that this is the end of the European Union, although I think that is unlikely, but I must say Paul Krugman (and many of the non-Greek twitter enthousiasts) writes as if they never faced bailiffs who evicted them from their houses while they were poor and ill.

Indeed, I find it very hard to believe Krugman and most others did have that experience, but I did (in 1985). It taught me a lot, and one of the things it did teach me is that when you are poor and ill and are faced with the bailiffs of creditors, you are delivered into the hands of eager sadists who will enjoy to destroy your life and your property as much as they can.

This indeed happened to Greece, but unlike most who have not been evicted from their houses, I was, and so I am not very amazed to see leading European politicians behave as if they are professional sadistic bailiffs.


6. China's stock market turbulence is over? Don't count on it

The last item of today is by Larry Elliott on The Guardian:
This starts as follows:
The numbers are mind-boggling. Ten days of falls on the Shanghai stock exchange resulted in losses that exceeded the GDP of Mexico. And 12 million Chinese citizens who opened share-trading accounts in May were nursing potentially ruinous losses. Margin trading – speculating on the stock exchange with borrowed money – increased five-fold in a year to 2.3tn yuan (£230bn).

While Europe’s focus has been the crisis in Greece, the Chinese stock market has been gripped by panic. The value of shares went up by 150% in little more than a year, then fell by 50% in just a few weeks.

Fearful that China in 2015 could find itself in the history books along with Dutch tulips, the South Sea Bubble and the Wall Street Crash, the government in Beijing stepped in to halt the rout. It cut interest rates. It banned large shareholders from selling stock. It used public money to buy equities. It allowed trading in more than half the quoted companies to be halted.

And, in the short term at least, it seems to have done the trick. Share prices rose at their fastest pace in more than seven years in the final two days of last week.

I say. There is considerably more in the article. It is listed here mostly because China has become very important in the world economy. And it may collapse economically, though probably not now.

---------------------------------------
P.S. Jul 14, 2015: I corrected a few small typing mistakes.

Notes

[1] According to the American Heritage Dictionary:
fascism is: "A system of government that exercises a dictatorship of the extreme right, typically through the merging of state and business leadership, together with belligerent nationalism."
Perhaps this doesn't quite describe the present American system (for there still are some rights and some freedoms, and maybe Obama is not of the extreme right) but it does come closer and closer (what with "the merging of state and business leadership" and a "belligerent nationalism").

[1a] In fact, I come from a - sincere and intelligent - communist family, and I never much liked or much admired capitalism, because it seemed and seems to be based on intrinsic unfairness. Also, I insist there are much better systems - but the problems are (i) to convince others and (ii) to introduce them without much and extensive suffering.

Indeed, to judge my radicalism: I think a considerably better system would be achieved if there were - merely (!) - an absolute cap on earning that is 15 times the amount minimums (like myself) receive - but who (amongst the very many greedy people who appear to surround me) wants to loose His Chance on becoming A Millionaire (or earning more than 15 times the minimal income)?! Only a small minority, I fear, even though at the very best an even much smaller minority will ever earn more than 15 times than what I receive...


[2] As to "(probable) facts": This expression is motivated by two assumptions of mine: 1. there are facts, regardless of all different opinions about them, and 2. we often do not really know what are the facts, and need to rely on judgements of probability.

[3] This is what Tweets are, by one of the founders (Jack Dorsey), quoted on Wikipedia:
...we came across the word 'twitter', and it was just perfect. The definition was 'a short burst of inconsequential information,' and 'chirps from birds'. And that's exactly what the product was.
I quite agree, and I am not interested in receiving or sending "short bursts of inconsequential information".


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