Winston Churchill on Greece's Bailout Mark 2 (almost)

In my previous post I described Europe’s latest Agreement on how to deal with the Greek debt problem, and the looming Euro Crisis, as a form of Crisis Appeasement. A New Munich that will haunt us Europeans for a long while. Today I cannot resist the temptation to couch my views on Greece’s Bailout Mk2 using the very words with which Winston Churchill ‘welcomed’ the Munich deal in the House of Commons: 

I do not grudge our loyal, brave people, who were ready to do their duty no matter what the cost, who never flinched under the strain of last week – I do not grudge them the natural, spontaneous outburst of joy and relief when they learned that the hard default [ordeal] would no longer be required of them at the moment; but they should know the truth. They should know that there has been gross neglect and deficiency in our defences; they should know that we have sustained a defeat without a war, the consequences of which will travel far with us along our road; they should know that we have passed an awful milestone in our history, when the whole equilibrium of Europe has been deranged, and that the terrible words have for the time being been pronounced against the Western democracies:

“Thou art weighed in the balance and found wanting.”

And do not suppose that this is the end. This is only the beginning of the reckoning. This is only the first sip, the first foretaste of a bitter cup which will be proffered to us year by year unless by a supreme recovery of moral health and intellectual [martial] vigour, we arise again and take our stand for freedom as in the olden time.

(See here for the original speech; in the above, I marked my minimal insertions in red and WC’s original words in square brackets.)


  • Yiani:

    I think the most pertinent and relevant part of the speech is this (the 2 parentheses are my poetic license additions):

    “We do not want to be led upon the high road to becoming a satellite of the German Nazi (Frau Horribilis) system of European domination. In a very few years, perhaps in a very few months, we shall be confronted with demands with which we shall no doubt be invited to comply.

    Those demands may affect the surrender of territory or the surrender of liberty. I foresee and foretell that the policy of submission will carry with it restrictions upon the freedom of speech and debate in Parliament, on public platforms, and discussions in the Press, for it will be said – indeed, I hear it said sometimes now – that we cannot allow the Nazi system of dictatorship to be criticised by ordinary, common English(Greek) politicians. Then, with a Press under control, in part direct but more potently indirect, with every organ of public opinion doped and chloroformed into acquiescence, we shall be conducted along further stages of our journey.”

  • The German full frontal assault on democracy took place in Europe 73 years ago. Once again, weak countries have left their defenses wide open, implicitly seeking or inviting a second invasion and they have not been disappointed. The weapon of choice this time? The Euro currency. Greece, Ireland, Portugal, Spain and Italy all signed up to a currency that was wrong for them. They got interest rates that were wrong for them. They gave up their respective currencies and when they needed to seriously cool things off they were given interest rates that exacerbated their problems. Furthermore, they foolishly believed that because they were part of a currency union they would be looked after. How wrong can you be? These countries all have one thing in common besides their debt mountains, they all have diabolical governance. Their economic problems are first and foremost political problems, problems of leadership, problems with greedy irresponsible leaders pedaling the myth that everyone could help themselves to the exchequer purse without ever having to fill that purse by selling goods and services. If it was empty they simply borrowed in the name of the sovereign. Hence, came the economic problems which always stem from poor government. The electoral systems offered a constant stream of opportunistic parties which had the same policies, endless variations of play now, live life to the full, eat, drink and be merry and don’t worry about the future. Well the future has arrived, it has come right through the front door, just as it was invited to do and it must be directed to the back door if democracy is not to yield to death by a thousand cuts. But the big question is, how are the failed democracies going to save themselves? How are the rogue parties suddenly going to change their spots? So far, they have been engaging in Herculean can kicking exercises many of which are certainly going to end in default. Ireland for instance says it is not Greece. This is because it knows full well that it needs another bailout Q3 of 2013 and Portugal will need one before the year is out of course Portugal too tells us it is not Greece!

    Some countries borrowed indirectly by letting their banking systems run amok and then moaned and protested completely disingenuously, that sovereign debt had been kept within or close to the 60% debt to GDP levels of the Stability and Growth Pact. That was lies. Take Ireland, I’am Irish. Ireland’s banks were expanding loan books at suicidal rates. Anglo is now famous for the 35bn losses but what about bank of Ireland? It took, Bank of Ireland 222 years for its loan book to reach 100bn in 2004 yet 4 years later it had reached 200bn thanks to the wonderfully profligate lenders of Germany, France and UK. All countries that are in trouble have borrowed too much and despite protesting that they are not Greece I think it will be found that it will be their similarities rather than their dissimilarities that will be most striking in the final analysis. These countries have little in common with Germany and should be holding their own “summits” to demand a common rescue plan rather than be forced to pursue a “Compact” which Nobel winning economist Joseph Stiglitz described as a “suicide pact”.

    • “these countries should be holding their own “summits” to demand a common rescue plan”…
      ur absolutley right!! just end this stupid eu-thing.– im just wondering, what industrial and intellectual capacaty those countries gonna work with…ireland? whiskey, ok, spain? tourism, ok. greece: ? dont know.

    • @Svarez Greece has tourism opportunities with its thousands of islands and hundreds of monuments from prehistoric to medieval times.

      In addition the merchant marine could again become prominent.

      Plus the gas and natural gas deposits that are being explored now, a la Cyprus. In many people’s opinion Greece is driven to the ground in order for the German etc interests to get at bottom prices their hands on gas and natural gas and minerals..

    • @svarez and Germans of course will take their BMW and Mercedes and use them in agriculture instead, because there will be NO demand in the rest of the world for them.
      In answer to one of your previous questions about how much money WE want, read this
      Now in conclusion, YOU Germans, are so ungraceful to the rest of the world. YOU destroyed your own country and the rest of Europe during the war (and yes, we still remember the war, how can we forget it?) but yet the very people YOU killed HELPED you to rebuilt your country. Shame on you for the way you are thinking.

  • History repeats, and then it repeats again, and then again, and again, and again, and again. Our only hope to break this cycle is this information age.

  • Well no disrespect dear Professor but perhaps ,while fighting indeed against the Memeranda, you shoudln’t have emphasised solely on plans like your Modest Proposal and preached only for a default within the €Z.

    However rational or middle ground your plan might have been(or not), politicians in Greece and the EU and most importanly the people of Greece didn’t go for it(at least according to polls).

    IMO people needed realising that
    *multiple scenaria were possible(though not equally probable) out there;these should have been analysed in full;people shoudln’t have been terrorised into going for whatever the latest party line calls for
    *whatever the personal preference,voluntary or not, the most probable outcome(according to most out there on the web,academics or laymen) aside from dying drop by bloody drop in a endless internal devaluation,is and has been default+Grexit;doesn’t your latest info verify this?Mustn’t people know and prepare??

    So isn’t it about time in example to at least put the Argentinian way and paradigm on the table on par with the others?
    Don’t you get that we can no longer have the false dichotomy of a Modest Proposal like plan vs Follow-Party-Line-Euro-is-sacrosanct-whatever-the-cost non-plan? That from the beginning, if indeed there has been a dichotomy before us,it has always been Default-Grexit vs Do-Whatever-The-Masters-Saviours-Order?
    Shouldn’t you have sided with the (few) other intellectuals of the the counter-Memerandum camp,putting aside all of you all your different views on Grexit etc and explaining to the People the various ways “out”,the various avalaible scenarios with their pros and cons and the multiple views?
    Can’t you do it now?

    Or do you still believe that our Holy Leaders in Greece and the rest of the EU-€Z will change their minds and follow your Modest Proposal?

    It will probably be done in vain but even if it will be only for the sake of posterity, consider doing it before the bond exchange takes place and our debt-bonds get transformed to 100% British Law and bilateral loans and things get even more tough(though not without a way out;recall that Argentina’s bonds unlike Greek ones,had NOT been issued mostly under Argentinian law).
    Heck even if the deal gets through people must be informed,aware and ready for the future.

    You have,I think, most of the public influence in mainstream-TV a counter-Memorandum intellectual can and does have.
    Please use it more wisely.
    It’s needed urgently…

  • Question, Yanni (and all):

    “We have sustained a defeat without a war”. Do you really think, the Greek military will declare themselves (and Greece) being defeated for ever? In plain words: I would not exclude (better: expect) a coup soon, having seen the list of demands by the Troika today in

    If Greece will vote in April or Mai, we will have a strong, very strong left. Will they allow that (additionally to the feeling of being under foreign control, being “occupied”)? I strongly doubt that.

    Yanni, a personal question: Your Bio tells, you and your family has expirienced the last
    Junta, I am sure you are very sensitive to that.

    What is your opinion on that? How big (or small) is the risk, the military steps in?



    • Thankfully, and easily predictably, they will not have a gallon of petrol to move, let alone the immense intellectual capacity and skills to organise a coup, in the first place. One of the achievements of the last 30 years’ of democracy, is to have every human endeavour in Greece turn itself into the image of a sloppy, malfunctioning and corrupt public sector. Armed forces not excluded. Unlike other eras, fascist and militarist-inclined young men who enlist soon find themselves and their “ideals” crushed by the daily merciless routine of the Greek public sector and transformed into “harmless” bureaucrats… No, there will be no “heroics” of that kind. Just a continuous downward slope to internal strife, crime, looting and resorting to local forms of organisation for self-protection and preservation… Something like a failed state, a Somalia of Europe… That bad!

  • Dear Yiani

    it’s always nice to read your interesting points.

    However, nowadays I think what matters most -for the majority of Greeks- is encapsulated in the following sentence:


    Since Art makes life beautiful, will you kindly allow me to present as a gift the following link:


    Take care ..


  • well, if really history is repeating itself in some way, and the present time correspond to the time before the WWII, after catastrophe we would see what correspond to the birth of the European Communities, would we get eurobonds, transfer union and directly elected EU president?

  • Questions is: what “intellectual vigour” means?

    As recent research [1] suggests, for humans it means the capability to put front whatever argument one deems appropriate to support one’s own pre-taken options AND the capability to logically analyse and detect inconsistencies in whatever argument is deemed to support options that one does not prefer or one does not want to take.

    For some people “intellectual vigour” means the capability to “intellectually trespass”.

    And perhaps more so, the capability to realize that most choices are un-reasonable in the sense that there is no rational procedure through which one can arrive to a decision or option among the possible choices. Therefore, in the end, one must follow what one “feels” or “wants” and one cannot do otherwise, although one can pretend to.

    If a social option is imposed on one’s life it does mean that it is “more reasonable” that the options one would prefer. Reason has nothing to do with that. It simply means that those taking the option harness and deploy more social power.

    The EZ is a case in point. The fundamental choice is between a “politically united” Europe versus a “nationally diversified” Europe. Which is “best”? For whom? It all depends on the eyes of the observer, his or her own self-perceived financial interests, her or his own preferences about the “strength and security of unity” versus the “creativity and resilience of diversity”, how much one values freedom, what freedom means…

    [1] Mercier, Sperber, 2011, “Why Do Humans Reason? Arguments for an Argumentative Theory”,

    • No, Trader:

      Your shirt will be taken when we collect WWII reparations. Stick around because I want to see how you look naked.

      You jave no idea with what type of people you are messing with, do you?

    • once and for all: just tell us how much money do u want, just that we can get rid of this black hole…im sure ur gona waste 500 billion within a month…

    • @svarez

      Instead of hiding in shame, you have the gall to make jokes as if there is some kind of equivalency between the hideous atrocities of Germany and financial mismanagement by politicians?

      I respect Yanis and this space too much to respond the way you deserve.

  • It is certainly essential that we look at the past, especially from periods similar enough to ours to have relevance and far enough away that they do not form part of our life experience and learn from them. I often have discussions with people who cannot imagine that something terrible may happen and use examples from the WW1 & WW2 eras to wake them up.

    On the other hand it is also a risk that by interpreting the present with the examples of the past, we can both err in our forecasts as well as end up as impediments to progress.

    I guess what I’m saying is I’m not sure yet that this parallel applies here. Right now, it looks like it might but there are many factors to consider many of which are in very different stages to 1938.

    Greece’s road today looks like it has a fork ahead, rather than a solitary path. Let’s wait and see.

    Sorry maybe the nice weather is making me ultra-optimistic today!

  • Why are you guys are not going nuts about this one:

    Projected PIIGS Pillage: 3233.5 Tons Of Gold To Be Confiscated By Insolvent European Banks:

    “While hardly discussed broadly in the mainstream media, the top news of the past 24 hours without doubt is that in addition to losing its fiscal sovereignty, and numerous other things, the Greek population is about to lose its gold in a perfectly legitimate fashion, following amendments to the country’s constitution by unelected banker technocrats, who will make it legal for Greek creditors – read insolvent European banks – to plunder the Greek gold which at last check amounts to 111.6 tonnes according to the WGC”

  • RT with Reggie Middleton: Why Greece Bailout Games Will Cause The Rest Of The EU To Breakout The Grease:

    • Trader:

      Just in case you don’t know. Anyone citing ZeroHedge and RT as credible sources is by definition an inarticulate, unsophisticated, deeply ignorant B-Trader.

      Wait, I just repeated myself again.

    • I see. Why don´t you let the readers decide if the like your castle in the air posts better than zerohedge. ;-).

    • Just to put this in perspective. RT & ZH are not perfect sources. However, on EU, EURO issues they give a much more neutral view than the German propaganda minister (Schäuble) or the EU or EU country state TV stations.

      So to get a complete picture it is necessary to also check out ZH, RT and especially Swiss & UK newspapers.

    • Bavarian Trader:

      I didn’t know that my opinions were as heavy as Castles-in-the-Air.

      I thought you thought that they were mere hot air balloons.

      But thanks for the invented term. Let me see if it is marketable. This is like saying that people from Bavaria are really smart. There is a certain sense of opposing gravity inherent in the term.

    • You are welcome to compete on smartness. I can offer an M.I.T. degree & 7 digit EUR net worth (self made from zero in 11 years of work).

    • “This is like saying that people from Bavaria are really smart. There is a certain sense of opposing gravity inherent in the term”

      I tried to find some data on your hypothesis. The only thing I found is unfortunately PISA data:

      In all years Greece ranked below Germany. I am not saing that is great achievement. The German result is actually pretty poor compared to others.

      Bavaria always ranks much better than the German average.

      Conclusion: Under the assumption that PISA data is sufficently correlated to intellect, you can deduce that Bavarian kids are smarter than Greek kids.

      The conclusion overall ispretty useless, but is sufficient ot disproves your hypothesis (unless you assumed that Greeks are even less smart)

      The much more helpful analysis would be how do Greek, German etc. kids compare that live in the same country and are in the sme school system!

    • Bavarian Trader:

      Who said that this conversation is about the brand of clothing you wear? This is all about ideas and politics and your qualifications are exactly what?

      Do me a favor. Effective immediately I ask you never to address me again. Not in this blog, not in life, not ever.I have never heard such a statement manifesting an acute inferiority complex.
      This includes your opinions about me that you so freely seem to disburse on similar threads.

    • Quote: “This is all about ideas and politics and your qualifications are exactly what?”

      For all readers except Dean:

      I am not so sure now. I always thought that my core qualification was to write big invoices to customers for ideas I give them. Typically I do this after surfing the web all day and then quickly putting something together in powerpoint, that looks like a solution to their problems. If it does not work, I tell them their implementation was not done well.

      Similar like plugging together cables under desks, eh?

      Sorry, I did not know I needed a PhD in politics to discuss on this board. I will try to get one quickly.

  • “And so for Merkel to say that states in the Eurozone have to control their budgets is just an indication of economic stupidity on her part. If they could then I am quite sure most would, all too willingly. They aren’t because they can’t. And the reason they can’t is because of fundamental accounting equations. For example, if the economy as a whole decides to save (I stress save, which means cash stockpiling, and is an act quite different form investing which involves expending cash) as it is now, with corporations in particular stockpiling cash in quite spectacular fashion, then government is going to run a deficit: it is an accounting truism. It is beyond government’s control but do so. And if it does seek to cut its spending in that circumstance – as Osborne is doing – then the inevitable consequence is that income – the only other variable in the equation – must be cut. So, fr example, as Martin Wolf has pointed out recently, if you cut government spending right now and it is corporate saving that is funding it the inevitable consequence is that you must cut corporate profitability to achieve that result. It follows like night does day.

    But this is what Merkel is saying. In a perverse throw back to the economics of the 1920s she is saying that come what may the governments of Europe must balance their books. The result is inevitable: the automatic balancing role that government deficits have played in the economy, picking up the slack in times of depression and recession, will instead be passed on to the private sector and individuals. That has to be the case. Business and individuals must run deficits if governments won’t. That’s not desirable, that’s just what has to be.

    But if banks won’t fund those deficits and there aren’t enough savings to pay for them (and the institutional structure of much saving such as pension funds does not facilitate this) then we’ll simply see income crash instead. That has to follow because what we also know is that as we demand that banks rebuild their balance sheets they will not lend to cover it.

    So Merkel’s plan is a plan for deep, deep recession. That’s what fiscal conservatism brings. It’s not chance. It is, as I say, just what will have to happen if this plan proceeds.

    This is the mad house of the commitment to the Gold Standard seen in the 1920s and which was so damaging wit large all over European economic policy.

    This is a policy guaranteed in the interests of the 1% whose savings will be protected from inflation (the alternative cure to this crisis) to wreak havoc on the well being of the 1%.

    This is a policy designed to destroy government.

    It is a policy designed to destroy the welfare state.

    It is a policy designed to destroy democracy.

    And it will do all those things.

    It is a policy designed to create social instability and turmoil.

    And it will do that too.”

  • Trader:

    Just in case you don’t know. Anyone citing ZeroHedge and RT as credible sources is by definition an inarticulate, unsophisticated, deeply ignorant B-Trader.

    Are you implying that only mainstream media sources are credible?

    Have you already forgotten about the New York Times and its “credible sources” on Iraq’s WMD program (to cite just one example of egregiously bad journalistic conduct)?

    I bet if you were on the receiving end of the “shock and awe” unleashed on Iraq, you wouldn’t be so quick to “inarticulate, unsophisticated, deeply ignorant” comments about the non-mainstream media, would you?

    Can you articulate to us readers here an example of bad journalistic conduct in either ZH or RT?

    Btw, what exactly is a “B-Trader”?

    • Dear lastgreek,

      please ask Dean. He wrote everything above (February 25, 2012 at 05:32). I solely quoted him.


      PS: I value both RT & ZH

    • My apologies for not making myself clear, Bavarian Trader. The post was
      meant for Dean Plassaras.

      PS: It’s like you said — RT and ZH, to name some alternatives to the mainstream media, are not perfect (who is?), but they do provide a good service in helping people understand economic/world events.

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