Galbraith on Greece

[gnk]

Re: This is a Mistery?

And what was the alternative? What would anyone here have done differently?

Looks like there was no secret drachma plan after all, so my other theory holds - Tsipras was incompetent as a negotiator, didn't understand what the stakes really were, and was way over his head. Only when faced with the prospect of Greece actually becoming a failed state on the level of a third world country, with no banking system and requiring airlifts of food supplies and medicines, did choose the lesser evil.

Instead of a memorandum, he would be begging the EU for these:

11742771_10155983490675105_2856847225318691490_n.jpg

[vt]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Tsipras and the Greeks have been trying to live in a Euro Marxist fantasy land.

They reap what they sow by deluding the people into thinking that early pensions, too many useless government workers, and 89% of the population evading taxes will ever work.

Hopefully the rest of Europe will come to their senses and reform their entitlement system. They need to get rid of the excesses of the banksters and start to build real economies based on productive manufacturing and not financial manipulation.

[astonas]

Re: This is a Mistery?

Shockingly Stupid Sequence of Events

I am seldom stunned by political stupidity. In fact, I am surprised when I don't see it.

Yet, I have never witnessed a political reversal so shockingly stupid as we saw tonight from Greek Prime minister Alexis Tsipras.

You can always tell when someone doesn't have the slightest clue about what's going on.

They are shocked (shocked!) by the most obvious and predictable things. Mish is like a baby who thinks a toy vanishes from the world when it's hidden, and is stunned to see it again.

Tsipras' actions are not even a little surprising, neither his resistance, nor his capitulation. The need for Greece to make this into a game of "chicken" (in which they would give way) was set in 2010, when nations, rather than markets, became the overseers of reform. That is what made every meeting into a display of fireworks for the media, in which each side was forced to make a huge show of protecting their voters at home. Greece will probably have to continue to act in exactly the same manner in subsequent rounds, too, until they reject one of Europe's (dramatically fought-over!) unanimous offers.

Alternatively, they could "accept" the offer, but instead of seriously executing on their side of it, delay, and prepare quietly but rapidly for a grexit in a few months, when they can no longer pretend to be cooperating. The lack of preparation for the drachma is really what makes that particularly problematic at this moment (unless that was an uncalled bluff). Once they are in position to implement a sudden switch and devaluation default, they could do a grexit on their own terms, to shed odious debt, regain sovereignty, and eventually return to a market-overseen reform agenda.

Of course, if they'd done all this earlier, they could have avoided the intervening period of looting, too.

Whatever it is that is keeping the Greek public's desire to remain in the EMU so high, it is really expensive. I honestly do not know what that is. Pride? Belief in the European Ideal? I don't think, at this point, that it can be called economic self-interest.

[Woodsman]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Tsipras and the Greeks have been trying to live in a Euro Marxist fantasy land...

Reading your post reminded me of the "Spike and Chester" cartoons of my youth.



Those were great, weren't they?

They reap what they sow by deluding the people into thinking that early pensions, too many useless government workers, and 89% of the population evading taxes will ever work.

One thing is certain, the EU experiment in economic and political unity is dead. It's little more than a currency peg now and will go the way of all such pegs.

Hopefully the rest of Europe will come to their senses and reform their entitlement system.

Hope is not a plan. Ever heard of "extend and pretend?" One political misstep or miscalculation and it's back to Grexit, with the Germans holding the door.

They need to get rid of the excesses of the banksters and start to build real economies based on productive manufacturing and not financial manipulation.

Sure. All they need to do is figure out how an economic reform program for which no Greek government has a political mandate, that has been explicitly rejected in a referendum, and that has been forced through by sheer political blackmail will be made to work.

Goodbye EU, welcome Greater German Co-Prosperity Sphere.

[Woodsman]

Re: This is a Mistery?

...Tsipras' actions are not even a little surprising, neither his resistance, nor his capitulation...

The Greek right should send Tsip a thank you card for doing what they could never, would never do.

The Greek political elites of PASOK and New Democracy would never have dared pilfer pension funds, local government deposits, and university surplus cash, even in the face of default. Their supporters would have hung them from lampposts. Much better to saddle the opposition with these sorts of "inevitabilities".

If they don't, I will. Bought a little odd lot of EEV at the end of April and cashed out Thursday for a tidy little summer bonus thanks to him.

[vt]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Even thought we don't always agree, I feel we share a disdain for the political elites on both ends of the spectrum. Both parties support elites and with control comes the excessive rewards, while 99% of the population is left with the crumbs.

Crony capitalism, communism, socialism, fascism; none work. It would seem like the brainpower here could come up with ideas with something that begins to have promise.

Any ideas?

[jk]

Re: This is a Mistery?

The Greek right should send Tsip a thank you card for doing what they could never, would never do.

it took a nixon to go to china.

[Woodsman]

Re: This is a Mistery?

it took a nixon to go to china.

I don't think that's the model we're talking about here, JK. And anyway, that turned out quite well for the Chinese. But for the American worker (all collar colors), not so much.

[gnk]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Tsipras and the Greeks have been trying to live in a Euro Marxist fantasy land.

They reap what they sow by deluding the people into thinking that early pensions, too many useless government workers, and 89% of the population evading taxes will ever work.

Hopefully the rest of Europe will come to their senses and reform their entitlement system. They need to get rid of the excesses of the banksters and start to build real economies based on productive manufacturing and not financial manipulation.

Greeks have not felt the pain of responsibility that comes with paying taxes or balancing budgets for decades. Government was a gravy train.

That's why Greece is in the position it is in right now. If you can't run your own country, you face two options: economic collapse, or someone runs it for you.

It's going to be difficult, but at least the EU is trying. It is very easy for the naysayers right now. The critics have been predicting the downfall of the EU for a decade and a half now. They still don't get it. What we're seeing right now is a slow convergence among the states of Europe. It's a difficult process, but needs to be done.

And at least Europe, unlike other developed countries, is addressing the issue of entitlements, even though they still have the best entitlements in the world- and I think they will always be the best, comparatively speaking. It's a European thing. And Germany is right to address the productive economy, and not look for excessive government spending/hiring or growing the FIRE economy to address the western world's current ills, unlike other countries.

In this era of globalization and unfortunate global imbalances, I think the German model is the most realistic in the Western world. However, I do believe that Germany needs to address its massive trade surplus within the EU.

[gnk]

Re: This is a Mistery?

Whatever it is that is keeping the Greek public's desire to remain in the EMU so high, it is really expensive. I honestly do not know what that is. Pride? Belief in the European Ideal? I don't think, at this point, that it can be called economic self-interest.

There is a strong belief in the European ideal, yes. But there is more.

Recall all the articles I have been posting in various threads detailing corruption and incompetence? Greeks are not stupid, unhinged occasionally, but not stupid. They know the system is rotten. They know that their current political system is an abysmal failure. They know better than all the well educated analysts and Nobel prize winning economists out there what life would be like in Greece should Greece go drachma.

I can't tell you how many Greeks from many political persuasions breathed a sigh of relief today, despite the damage to national pride.

[vt]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Yes gnk.

The Greeks aren't alone in the entitlement mentality. Much of Europe is as well as portions of the U.S. The FIRE economy is as unrealistic as over weighted public sectors.

Germany has done well on the export stage; if only the rest of Europe was as productive. Germany does have major problems in the near future with it's demographic downtrend. They have to engender more domestic spending in the EU.

[lakedaemonian]

Re: Greece / Suicide Rate Surges 35% In 2 Years

Even thought we don't always agree, I feel we share a disdain for the political elites on both ends of the spectrum. Both parties support elites and with control comes the excessive rewards, while 99% of the population is left with the crumbs.

Crony capitalism, communism, socialism, fascism; none work. It would seem like the brainpower here could come up with ideas with something that begins to have promise.

Any ideas?

It all ends the same way as you say.

Crimes of mass political/financial corruption should be dealt with decisively.

A ponzi schemer doing a perp walk doesn't cut it.

Corruption franchises have been built with multiple concentric "moats" around them not unlike the way Warren Buffett recommends searching for businesses to invest in.

How do you drain the moat?

How do you breach the walls?

How do you prevent it from happening again?

How do you defend the main effort(a fair and reasonable game of monopoly) if you gain traction and when you are targeted nicely and not so nicely by deeply entrenched interests not keen on the idea of losing the greatest illicit franchise ever?

-----

What happens when a good police commander stands in front of the narco/human trafficking bus?

He/she takes the money, or his/her family is liquidated.

And narco/human trafficking is small change compared to these deeply entrenched illicit franchises.

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I don't see a "viable alternative" gaining any significant traction within a corrupt and compromised 2 party, no choice system.

Recall EJ's own comments on Eliot Spitzer journey to power and his fall from it.

The very self-compromise that provided the key to entry to power was his undoing when he went off message.

Would he have passed thru the various gates to power if there were no compromise strings attached and pulling him?

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A successful alternative, if achieved, would likely have to be highly unconventional/viral, resilient/persistent, and probably messy.

-----

I've long thought that a single issue, non-partisan, internet centric effort to inoculate the systemic corruption would provide the best opportunity.

Maybe chemotherapy is a better choice of words than inoculation.

inoculation implies cure, while chemotherapy implies control/mitigation.

Corruption is never going to be cured, but it could certainly be far better controlled/mitigated/filtered.

Candidate positions on abortion, gun control, illegal immigration, welfare, taxation, etc. are all secondary after primary consideration is given to understanding who owns the candidate? The constituency or the corporates?

But even then.......how do you effectively deal with constituents who collectively scream at their elected politicians to bankrupt the country tomorrow in order to get more stuff today?

You didn't include benign totalitarianism.

[ProdigyofZen]

Re: This is a Mistery?

Questions

• [*=left]Did the US bribe Tsprias with a secret account worth millions?
  [*=left]Is someone holding his kids hostage?

If one of those (or something similar) does not explain the reversal, then what does?

Perhaps Tsipras did exactly what he was planning to do.

Chain of events:

1. Demand whatever X that they knew Germany would not agree to.

2. Push out the timeline to the absolute last second.

3. Call a "surprise" referendum to get the people to vote against the atrocious "debt agreement."

4. Wait until the very last second once again.

5. Accept an even worse "debt agreement" from Germany and the EU.

6. All in order to play the ultimate hand of poker: To show the world the totalitarian actions of Germany and the EU with the sacrificial lamb being the Greek people setting up the future event of a potential collapse of the EMU or fiscal unification.

[gnk]

Re: This is a Mistery?

Hanlon's Razor:

Never attribute to malice that which is adequately explained by stupidity.

Watch this to understand the above.

[ProdigyofZen]

Re: This is a Mistery?

Hanlon's Razor:

Never attribute to malice that which is adequately explained by stupidity.

Watch this to understand the above.

Perhaps, I know the principle.