A Mental Experiment for establishing the relative mood for solving the Crisis in Europe, in Britain & in the USA

I have a hunch: that the Eurozone’s profound difference to both the United States and Britain is that, unlike these anglosaxon ‘currency unions’, the Eurozone’s real elite does not want the Crisis to disappear quickly and painlessly. In this post I offer a mental experiment that will help each and every reader rule on the merits of my hunch via introspection (or, perhaps, projected introspection).

Let me explain my hypothesis clearly before proceeding further. Setting aside the feasibility or availability of any magic bullet solution to the Crisis that engulfed us all after 2008, my hypothesis pertains solely to the elites’ (and the people’s) mood; to how Europeans, Brits and Americans would look upon such a magic bullet were it to be presented to their leaders on a silver platter.

Let’s begin with the United States. Suppose that Tim Geithner were to enter the Oval Office, accompanied by Ben Bernanke, with excellent news for President Obama:

“Mr President, we have discovered the magic bullet for ending this terrible crisis; for pushing unemployment down across our great land to an average of 4%, for balancing the federal budget, for re-energising our financial system, for restoring sustainable growth, for returning bond yields to normal levels. Here is a small device. Just press the red button and it will be done.

Alternatively, you may press the adjacent yellow button, in which case the US economy will remain stable at its current state, caught in the same doldrums that beset us over the past two years, with unemployment high for a decade, the deficit in full flight, US Treasury Bills continuing to pay rates close to zero and, meanwhile. equities depressed. The yellow button will, effectively, keep our economy bopping along, stable, miserable and always close to a second dip.”

Would President Obama consider the yellow button or press the red button? Assuming that he believes Geithner and trusts that buttons would do what his Treasury Secretary promises, the answer is so obvious it is not worth dwelling on. He would instantly press the red button and the whole nation (even grumbling Republicans) be grateful for his choice.

Let us now move to the Atlantic’s other side. In Britain the situation would be no different. Mr Osborne would visit 10 Downing Street, with Nick and Ed in tow, and would deliver Mr Cameron the two options, with precisely the same result: A relieved PM would press the red button and effect a miraculous escape from the clasps of his own austerity-fuelled recession.

Finally, picture the scene when a sheepish Mr Schoeble enters the Chancellor’s Berlin office with the following two options:

“Red Button: You press it Chancellor and the Euro Crisis ends immediately, with a general rise in growth throughout Europe, a sudden collapse of debt for each member-state to below the Maastricht level, no pain for Greek citizens (or for Italians, Portuguese, etc.), no guarantees for the Periphery’s debts (states or banks) to be provided by German and Dutch taxpayers, with interest rate spreads below 3% throughout the Eurozone, a diminution in the Eurozone’s internal imbalances, and a wholesale rise in aggregate investment.

Yellow Button: You press it Chancellor and the situation in the Eurozone remains more or less as is for a decade. The Euro Crisis continues to bubble along albeit in a controlled fashion. While the probability of a breakup, which will be a calamity for Germany, will remain non-trivial, the chances are that, if you push the yellow button, the Eurozone will not break up (with a little help from the ECB), German interest rates shall remain extremely low, the euro will be nicely depressed (‘nicely’ from the perspective of German exporters), the Periphery’s spreads will be sky-high (but not explosive), Italy and Spain will enter deeper into a debt-deflationary spiral that sees to a reduction of their GDP by 15% over the next three years, France shall slip into quasi-insolvency, GDP per capita will rise slowly in the surplus countries and fall precipitously in the Periphery. As for the first ‘fallen’ nations (Greece, Ireland and Portugal), they shall become little Latvias on the Mediterranean: devastated lands with a total GDP at around 50% to 60% of pre-Crisis levels, a massive exodus of all their skilled labour, and a destination for cheaper holidays as well as real estate bargain hunting . In aggregate, if you choose the yellow button Chancellor, the Eurozone will remain recessionary, Eurozone unemployment will stay well above UK and US levels, investment will be anaemic,  and poverty on the up and up.”

Which button do you think Mrs Merkel would want to push? And, quite a separate question, which of the two buttons would the median German voter want her to push?

Of course, these are both hypothetical and empirical questions and no one can answer them definitively. However, I submit to you, dear reader, that the answer is not as straightforward as in the US and the UK cases. Whereas the yellow buttons would hold no attraction for President Obama and PM Cameron, Mrs Merkel’s yellow button is a far more powerful candidate. For my part, I would like to think that Mrs Merkel would want to opt for the red button. But I seriously fear that she would be terrorised by the reaction of the German electorate were she to do this, and thus let the Greeks and the Italians, the Spaniards and the Portuguese, ‘off the hook’ so easily. For two years now, the German public has become convinced (falsely) that Germany has escaped the worse of the Crisis because of the German people’s virtuous embracement of thriftiness and hard work; in contrast to the spendthrift Southerners who, like the fickle grasshopper, made no provisions for when the tide turns nasty. This mindset goes hand in hand with a moral righteousness which implants in good people’s hearts and minds a penchant for exacting punishment on the grasshoppers – even if punishing them also comes at a cost to themselves.

If I am right (and I fear that I am), the mental experiment proposed here throws useful light on Europe’s spectacular reluctance to deal with the Euro Crisis. For while there is no red button as such, the solution to the Euro Crisis is not as hard to engineer as the 19 failed EU Summits would have one believe.


    • With your hand on your heart, would you predict that the German median voter would want Mrs Merkel to press the red or the yellow button?

    • I just think it is so non-productive to devote brainpower to hypothetical constructs at a time where particularly the outstanding Greek brain power would be desperately needed for constructive purposes!

    • As long as you remain focused on Greece, at a time when Europe is being torn asunder by a systemic crisis that is aided and abetted by a 1930s like public mood in Europe’s core, your own brain power is wasted Klaus. As a Greek I am honoured by your focus on our country. As a European I dispair at your reluctance to recognise that there is something terribly rotten in the foundations of Europe; something that shows up first in flimsy places like Greece.

    • Yiannis, “As a European I dispair at your reluctance to recognise that there is something terribly rotten in the foundations of Europe” – this is very sad. (Assuming you are talking about the Euro) To say a defacto Gold standard is rotten makes me despair.

      You prefer a system where private banks have a monopoly on the creation and destruction of currency through central banks?

      You prefer a system where politicians and political views are easily manipulated by a small group of central bankers and international banks?

      You prefer this rather than having a sound currency based on labour and property rather than a system whose value is based on the amount on money printed or not.

      Surely you do not believe you can increase wealth by creating money?

    • @yanisv:

      “As a European I dispair at your reluctance to recognise that there is something terribly rotten in the foundations of Europe; something that shows up first in flimsy places like Greece.”

      You are wrong in that the rotten foundations of Europe showed up first in flimsy places like Greece!!!

      The rotten heart of Europe showed up already back in 1992 when the Deutsche Bundesbank with deviousness forced Britain to leave the ERM!!!

      Read this book if you want to know more about the hidden role of the Deutsche Bundesbank in the ERM, ERM2 and obviously also in the ECU and Euro!!!

      Connolly – The Rotten Heart of Europe; The Dirty War for Europe’s Money (1995)


    • Hypothetical clearcut questions are in fact the only valid way to engage in philosophical discourse. The simplified version of reality uncovers things that many would prefer not to be known, and probably just as many are not even aware of.

      As far as not focusing on Greece is concerned, I can assure you that Yanis is entirely correct. I live in Greece, but was trained and then taught economics in UK universities; it is clear that there is nothing that can be done to ameliorate the damage that has been done to the economy through eurozone membership and the appalling stupidities subsequently carried out by the Troika.

      Nor is it correct to focus on Greece when similar problems exist in more than half the eurozone. This is not a simple matter of profligate spending by southern governments (as the Germans would have it); the economic situation is resolvable, but only through the institutions that caused it in the first place. That is, the eurozone.

      Since Germany is being allowed to run the eurozone, then all attention should be on Germany. Please do not distract people with trying to focus on Greece. The problem is with Europe, and specifically with the terrible political leadership of Europe. Indeed, these are more political problems than economic — regardless of the underlying weakness of certain economies, and the deteriorating overall position of Europe in the global economy.

    • Yanis, instead of focusing on red or yellow buttons, allow me to turn the question around.

      Assume, hypothetically, that all of Greece’s sovereign debt is forgiven (at least that portion which is held by foreign creditors). So Greece would have a second chance and start all over with a clean slate. Whether Greece decides to embark on that second chance with the Euro or with the Drachma is up to Greece. In any event, Greece would again have a sufficient debt capacity.

      My question to you would be: what needs to change in Greece so that the second chance is not blown like the first one?

      My opinion: if nothing were to change, Greece – with the Euro – would be back to where it is today within ten years. With the Drachma, perhaps a bit longer. Either way, no long-term perspective.

      So I come back to my question: what would you (and others who are in a position to make good recommendations) recommend that should change in Greece? And the follow-up question would be: why not focus on these things now and let others work on the Eurozone mess? I definitely do not buy into your premise of passivity until the big storm has settled.

      I have been fascinated by some of the initiatives which Greeks have taken at the individual level such as the potato movement, the don’t-pay movement, the parallel currency in Volos, the trend to move back to the countryside and return to a “normal” life, etc. etc. I read the Greeceischanging FB site and am impressed that there are indeed people who have a forward-perspective. But individuals alone can’t do much if there is not a general movement for change.

      I will not forget the point made by a student in Thessaloniki in a debate following a little talk I gave: “We know our country is in trouble; we would like to contribute something to make things better but someone has to show us what we could do!” Well, I find it saddening when all that their role models can tell them is that there is nothing they can do (except perhaps vent their frustration in blog comments).

      I am not nearly as much a believer in models and structures as you are. The best structure won’t work if the users go bananas. You can have the best-structured and controlled financial sector. If intermediaries go bananas and package dodgy sub-prime debt into well-rated securities and if investors go bananas and buy the stuff like there is no tomorrow, a lot of people get hurt when it turns out that dodgy debt is dodgy debt after all.

      Yes, even the most uninformed European has meanwhile gotten the message that perhaps there was something very deficient in the Euro-structure. It’s like a car whose steering wheel is slanted to the left. A good driver will compensate for that by slanting his driving to the right. A bad driver may just let the car veer off to the left and have it run into the ground. Perhaps to prove that the steering wheel was slanted.

      Now, let me give you a couple of if’s how the deficient Euro-structure could have worked nevertheless. If Germany (and France) had not set the precedent that Maastricht criteria didn’t have to be taken all that seriously. If EU-politicians had not, as I understand they did, deprived Eurostat of the authority to audit national accounts. If EU-authorities had been more aware that current account deficits can be much more dangerous to an economy than budget deficits and if they had treated those imbalances with the same care that they had intended to treat budget deficits with. And so forth.

      If all of those if’s (and I could list more) had been observed, controlled and managed, well, then the Eurozone wouldn’t have been torn asunder despite its structural deficiences. So if that’s the lesson which one can learn from the first go-around, why not apply it to the second chance.

      I don’t exclude Germany (and France) from any responsibilities. I once wrote that should the crash come and should I lose my savings, I would not blame Greece for that. I would blame the incompetence of EU-elites for having mismanaged everything so badly. But even after the crash, Greece will still be a country of about 11 million people and unless one wants most of them to migrate elsewhere, someone will have to come up with ideas how a country of 11 million people can take advantage of its hitherto totally underutilized competitive advantages and resources, and employ its people so that they earn salaries which allow a decent living standard and pay a fair amount of income taxes; whose employers pay corporate taxes and where the owners pay taxes on dividends.

      Around the corner from where we live at the outskirts of Thessaloniki there is a dream palace which, I understand, was something like the King’s summer residence. There is at least one policeman on guard 24 hours a day. I guess his job is to make sure that no one can enter to see how the palace rots away. How about allowing those students who are looking for ways to make a contribution to fix up the place; get it into shape so that some kind of revenue-generating activity can take place there; have them organize such revenue-generating activities; promise them a share of the action. Perhaps even the policeman will quit his public sector job to join the students because it is so much fun to take part in an activity which holds promise and because his cut of the action may be more than what he is earning as a policeman now?

      I am, of course, oversimplifying to make a point but I insist on my point that it is not impressive at all to me when one spends all one’s resources on trying to fix other people’s problems when there are so many “own” problems that can/should /must be fixed.

    • @Klaus Kastner:

      You said this: ” If EU-authorities had been more aware that current account deficits can be much more dangerous to an economy than budget deficits and if they had treated those imbalances with the same care that they had intended to treat budget deficits with.”

      What you have mentioned about the trade deficits vs trade surpluses is exacty the catch 22 of the whole Eurocrisis!!!

      And we don’t have to blame the EU authorities for that since it is purely Germany and its satelites which are in complete denial of this core problem of the crisis.

      The German panacea to this fundamental flaw of the Eurozone has been AUSTERITY! Since austerity reduces the spendable income of both private households and the public household and hence reduces also the trade deficit!

      The only problem with that is that it puts the burden purely on the shoulders of the deficit countries and avoids any transfers from the surplus towards the deficit countries.


      If one takes into consideration the above factual situation, it seems to me that it was very helpful for the whole German establishment (Media, Government, Banks and Industial interests) to resort to discriminatory and even racist propaganda in order to blame the deficit countries as lazy people and profligates instead of aknowledging also their own fault in this dilemma!

      I fear that the result of this gross misconduct by the feeble-minded German elites won’t be a second chance to solve the crisis but a break up of the whole Eurozone and maybe even the EU as a consequence!

      In the history books the culprits of this major European desaster will be well known and it won’t be a small nation of about 11 million people!

    • “Since austerity reduces the spendable income of both private households and the public household ” government austerity would have limited effect on the private household economy in the long term. In Greece the private sector has been asked to undergo austerity and not so much the government.

      “The only problem with that is that it puts the burden purely on the shoulders of the deficit countries and avoids any transfers from the surplus towards the deficit countries. DOES THIS SOUND LIKE GERMAN SOLIDARITY TO YOU???” – What would you prefer? That the Greek government takes on more debt with the Greek taxpayer footing the bill?

      ” it seems to me that it was very helpful for the whole German establishment (Media, Government, Banks and Industial interests) to resort to discriminatory and even racist propaganda in order to blame the deficit countries as lazy people” again, some links please backing this up

    • Klaus

      “why not focus on these things now and let others work on the Eurozone mess”

      In other words to make and use the reforms for our own advantage no matter the EU problems.
      How didn’t we think of that? No really ,how?
      I totally agree. It is so simple. Let us all go in the parliament and kill.
      Then someone else will become PM and we’ll take it from there.

      On one hand you like the initiatives on the other hand you talk about pasitivity. If you mean the government’s pasitivity ,it is the government the Troika wanted. And still we no more have a deficit and many reforms have already been made. There are specific reforms we do not want ,because they are not for us. It is obvious that these reforms will be made for sure by this government. The lies that Greece hasn’t done anything is for the people to believe that more must be done ,including total loss of sovereignty.

      Lies and attacks to cover up the criminals will not stop until they impoverize everyone and people start killing.

      Everything has been explained again and again but you do not accept anything than what you say.

    • Klaus: if you cannot understand that there is no microeconomic solution for an economy with severely depressed demand for several years, then you do not understand the situation that Greece is in.

      Of course, there are serious structural problems in the Greek economy, However, even if you fix every single one (which would take at least 10 years, to be optimistic) that would still not affect aggregate demand. Then you would have to rely on exported goods to refloat the economy: that would take another 5-10 years to sort out (if indeed Greece were able to produce and sell internationally in a competitive global economy).

      So, with your approach we should all starve for 20 years in the faint hope that the Greek economy could undergo a massive transformation (the like of which has never been seen) and maybe become a global exporting country in a period when this gets more and more difficult. I hope you see that this is not a strategy: it is a clutching at straws.

    • If you take a sector of Ellenikon and make it a Special Economic Zone (or “Economic Microcosm”, to use Peter Economides’ term). If you tell an investor that you will permit him there completely competitive international business conditions (i. e. to produce tooth paste as competitively as in Brazil); if you tell him that you will protect him during a start-up phase of, say, up to 2 years with 100% special taxes on imported toothpaste so that he can get his business up and running; if you protect him against all sorts of political risks (incl. the risk of a Grexit); and if you approve a base case business plan which assures an ROE of 10% or more — then you will get this investment within 3 months. Provided that you can also offer him a one-stop approval process which will not last longer than 3 months. And then you get new jobs in a hurry. There must be a reason why thousands of Greek companies “fled” with their investment to FYROM and Bulgaria since the outset of the crisis. Those reasons must be neutralized.

      All of this would violate EU-treaties. This is why I am saying that if the EU did not amend treaties for such purposes (i. e. real help for Greece), Greece would be better off seeking friends outside the EU. See details below.


    • @Aristoteles

      Have you ever considered that Germany accounted/accounts for only about 15% of Greece’s current account deficit? Has the question ever entered your mind who the other 85% are? I give you a hint: China shares first place with Germany with another 15%. Have you complained about China lately? Have you asked how China is helping Greece?

      So many people – you apparently included – use the term “austerity” without clarifying what they mean by that. The wrong austerity, when overdone, is fiscal austerity because a fiscal deficit puts money into the economy instead of withdrawing it. If you cut the deficit too much and in the wrong places, you are cutting into your earnings power. Yes, I agree, that kind of austerity was overdone in Greece and it was applied unfairly and unjustly (basically catching those who were easy to catch, i. e. people who are taxed at the source but shying away from touching the real taboos).

      An external deficit (current account deficit) means you are withdrawing financial resources from the country. This is where Greece would have needed real austerity (and still does). Bear in mind that as late as Jan-May 2012, Greece still spent 1.320 Euros abroad for every 1.000 Euros it earned abroad (32% national overspending). And it imported 2.090 Euros for every 1.000 Euros which it exported abroad. That is not national austerity but national profligation instead.

      The Euro has indeed done a lot of longer-term damage to the Greek economy but in the last 2-3 years, Greece can be happy to have had the Euro. Without it, Greece would have had to bring its external accounts into balance practically overnight after the outbreak of the confidence crisis. The current account deficit 2008 was 35 BEUR. In 2009, Greece would have had to essentially cut out 35 BEUR from its imports. Not much left for cars, motorbikes, smartphones, etc. after paying for imported energy, medicines and foodstuffs! If at all!


      Everything has been explained again and again? My whole point is that someone ought to start explaining that there are indeed things which Greece can do on its own to improve its situation. Please refer me to sources which have done that (other than McKinsey, Roland Berger, OECD & Co.). Some of my explanations were and still are: reign in imports through import substitution which creates new domestic economic activity (even if that requires some protective measures); to use my favorite example; make your own toothpaste employing your own people instead of importing it from Brazi and stimulating that economyl; establish Special Economic Zones for new investment (particularly into import substitution and new exports); do everything to attract foreign investment; and don’t exclude the possibility of establishing at least temporary capital controls. Some of the jobs which have left Greece due to the import madness need to return to Greece and some of the financial resources which have fled the country should, too.

      If the EU did not allow Greece to implement such measures (which are partially against valid EU laws), then I would be on your side and agree that the EU is preventing Greece from helping itself.

    • @Klaus

      Most of your proposals (such as a Dubai-style tax-free zone) contradict not only the letter of EU law, but also the whole spirit and strategy of the EU. That is not to say that you are wrong to suggest such things, but merely to point out that you too are implicitly demanding major structural changes in the operation of the European Union and the eurozone.

      Greece is no longer a sovereign state with its own economy; in particular, eurozone membership eroded much sovereignty, but formal EU memerbship also had done so some time ago. If Greece were to quit the EU as well as the eurozone, then your policy proposals would be valid. Until it does so, Greece cannot act and is dependent on the EU politicians taking appropriate measures to save the eurozone and ultimately the European Union. I do not think that exceptional derogations from basic economic principles of the EU would be allowed to Greece; I doubt that anyone would even dare to propose them.

    • Of course, as I had said, they are against current EU-law and spirit. Perhaps the EU would indeed never agree but it should be tested. I mean, it’s lot cheaper for the EU to allow Greece (and perhaps other countries) some transitional protection so that they can get their economies into shape than to make huge transfer payments. Of course, exporting countries would cry foul play but then one has to pose the question the following way to them: do you want to continue to export full blast? If yes, sent the money for payment along with your products. Otherwise, just accept less exports.

      One has to first establish facts and then see if they fly. If one never tries it, one will never find out. If I were the Greek government and if I thought I had perfect solutions for the Greek economy and if the EU prevented me from implementing them, I would start thinking that there might be better partners than the EU elsewhere. And I would test that, too (under no circumstances am I implying that there are presently perfect solutions!).

      If you have a field of strong grass, you can have an army march over it. It will be damaged but grow again. If the grass is still in “infant industry condition”, the army will destroy it and it will never grow again.

      The slogan “Greece has to become competitive” is a good slogan. However, as long as there is a situation where two of the four EU-freedoms (free movement of goods and capital) act like killer-apps for the Greek economy, there is no hope to make the grass grow. Obviously, if Greece returned to the Drachma, what I suggest would happen automatically. All I am saying is that if Greece stays in the EZ (which I still think should be the objective!), then it will have to – for some time – simulate a situation as though it had returned to the Drachma (make imports more expensive so that substitution begins; make exports cheaper; reign in capital flight; attract foreign investment).

      I liken it to a highly talented, but not yet formed Greek soccer player from a regional club who is sent to Real Madrid. Once he has gotten used to the way of life there, they tell him that he has to improve his game (“become competitive”) or else get kicked out of team. My suggestion is: send him first to a top club in Athens; make him a star there and then send him on to be competitive with other stars.

    • Klaus

      I agree with you ,as most of the time ,except one thing ,as most of the time.
      And this one thing is what makes your suggestions obsolete right now. Just for now.

      Any problem in Greece was on purpose magnified and used for certain interests and with the final goal being the resources of Greece.
      Bear with me.

      The Troika knows these reforms will not be fully implemented and they know this because many reforms that were asked ,are impossible to implement as many studies have shown by now ,even if the Greek politicians weren’t traitors.

      The Troika doen not have any problem with that since she gains “legitimacy” to ask more from Greece in other forms.
      Delays of the government are planned with the Troika. They perfectly work together.

      For me the resources are my main concern. Because of Greece’s location and true wealth ,these manipulative games began decades before the euro. The euro was a very ingenius device for this economic hit. Any problem caused:
      deindustrialization ,subsidies ,cheap credit ,destruction of agricultural production and many more appear one way or another as terms or as immediate effects of other practices for the inclusion of Greece in the EZ. Including the creative accounting that was done in full knowledge and to be more specific by orders of “Germany” and leaders of the time.

      Today ,the Greek population was very clear.
      Do not give up resources and sovereignty and Merkel can come in Greece and beat up any corrupt Greek she likes.
      But the facts state otherwise about the true purposes of Merkel’s policies.

      Yes to the reforms ,No to inane policies that are so accurately designed by the Troika for many of them to fail.
      With many of them Greece is to become the “example” as they say and ofcourse with the profit they seek.

      For this is the final plan:
      To blame Greece for everything so as to gain legitimacy for grabbing the resources while during the crisis ,everybody would prepare accordingly (banks ,elite investors ,governments) for a controlled exit of Greece and/or controlled euro break up.

      The problems in Greece ,were magnified on purpose.
      The internal problems had nothing to do with the origins of the crisis. The opposite is true. The crisis has everything to do with the internal problems ,because the crisis is just a tool.

      The Cooper agreement about the underground and underwater wealth of Greece that ended in 2010 leaves open a matter of great importance.

      The memorandum is very clear about the use of the land of Greece.

      The only sure program from the beginning was this:
      the sale of tens of thousands of units of public assets and sources of public wealth. The simplest and most easy for an incompetent government, the most profitable for the lender’s greed and the most damaging to the poor debtor. This program, already underway, it is not, of course, program of development or recovery, but destruction of the country.

      The euro worsened the situation and although you are right saying about how “lucky” Greece is to have the euro the last three years ,taking into account the memorandum and all past manipulation ,she is not lucky at all and we would be better off if we had got out immediately with all the pain that move would have brought.

      Two dangers.

      Danger number one:
      The loss of public property and sources of national wealth.

      As we have repeatedly denounced ,the loan agreement of May 10, 2010 has committed all of the public property in favor of lenders, and the Greek government has waived any right to refuse the transfer of government property which is essential for dominance and survival of our country (Articles 4 and 17 § 5 of the Loan Facility Agreement) and the protection provided to us by international law and EU law (by putting us in English law, Article 14).
      The same commitments accepted in Memorandum B [Articles 5 (1) (2), 15 (1) (2) (3) (4)]. The Memorandum B includes , indeed, express condition (with A Memorandum implicitly forbidden), which prohibits Greece, now and in the future, to commit itself and to commit to freeze the assets against third persons and states! (Complete destruction of the sovereignty of the State).

      The implementation of this unprecedented commitment and the way of the sale of public property ,has been enacted by the Parliament with the also unprecedented in the modern history of slavery state law (the “applicable” law 3986/1.7.2011).

      I recall a sketch of the regulations of this law, who founded the notorious Company-Fund for the auction:
      Any company or the suggestion of confidence of the lenders ,will choose the asset that wants to take for use – the asset will be transferred immediately to the “Fund” without right of return – the “Fund” with a special board will assess (without transparency) the value of the asset – in this price without international tender will be transferred tax-free and free choice of company to lenders – the transfer will be final (sale) or longterm (usually 70-99 years) for exploitation – all (huge) operating expenses of the Fund and management of the asset transferred at a time will be borne by the Greek state – the amount of the proceeds will be deposited in the “Fund” by the operating company or market, which within a few days (10 days!) will transfer them to the lenders without allowing a single penny to enter to the fund of the Greek state.

      The picture is clear … The “privatization” of 80,000 state assets (reported Sunday newspaper) and many others that are not disclosed, are the real objectives of the Raichenmpach Group’s activities ,incorporated within this system of “exploitation” of the Greek public estate.

      Danger number 2:
      The imposition of controlled (by lenders) bankruptcy.

      We have rewritten that a controlled by the lenders bankruptcy is much worse than the uncontrolled full bankruptcy and the worst of all solutions. Why?
      For the following reasons:
      Because with uncontrolled bankruptcy and the country in need ,this generation is undoubtedly facing great financial sacrifices (such as, for example, in late 1950), but:
      the country has not lost its supremacy, not lost its public property and the sources of wealth, legally released from the shackles of debt obligations, released from the prohibition to exercise political economy of protection and future generations are not jeopardized. Alone Greece, with the advantages of a multidimensional foreign policy, can recover.
      Conversely, controlled bankruptcy by lenders, which lead us to the extreme neo-liberal policy of the EU, led by Mrs. Merkel and the three co-ruling parties, has the following meanings:

      • Exit from the euro. Because they can not do this officially, nor is it easy to exercise political and economic force, will ensure the consent of the government so that Greece can leave… “in her will.”
      • Controlled rate drachma, in order: the Greek people to lose much of their money, lenders to secure loans and public property in Greece and for the decline to continue indefinitely harder so as to control us.
      • Sale of public property, the arrangements described above, for many generations.
      • The full dehellenization of the Greek economy with the transfer of control to the multinational level
      • The flight or enslavement of the human potential of future generations.

      To avoid both these catastrophic risks for Greece, and the full and uncontrolled bankruptcy, only a proper and consistent with international law solution exists:
      the declaration of a state of economic emergency, which will be accompanied by:
      (a) default (in the sense of suspension),
      (b) with effect from the government of legal measures imposed by the state of economic emergency (eg protection of Greek production and consumer) and
      (c) renegotiate loan agreements and return to the international and European legitimacy both in the amount of loans (at the height of “non-burdensome debt), and as to the legality of credit conditions.

      If the lenders refuse this negotiation, it remains as a solution:
      also in line with the international law of terminating anyway illegal and void-loan contracts (known as the “Memorandum”). This solution requires, of course, political will and determination to exercise a multidimensional foreign policy and, above all, capable and strong political leadership.

      Various solutions of debt reduction and economic policy have been proposed. Many of these are correct. For Greece, however, with the dissolved state, the ruined economy and policy situation of servitude, these are palliatives.
      What is not heard at all ,is dealing with abolition of the three conditions that catalyze the sovereignty of the state:
      (a) of the complete commitment of public property and foreign economic policy,
      (b) to waive the rights of sovereignty and
      (c) the inclusion in English law which means a corresponding waiver of the protection of international law.

      These conditions, although weak, are applied daily by our lenders, mainly from our government. If not removed and in the contracts and in practice, any renegotiation promise is a scam.

      * extracts of the above taken from an article of the constitutionalist George Kasimatis
      Newspaper: To Paron tis Kyriakis ,22.7.12

    • Just quickly on privatizations. Resources don’t disappear; only ownership changes.

      I would downplay the financial aspect of privatization. To me, the most imports things of privatizations are know-how transfer in ALL areas (not only technological) and good managedment without interference from political parties.

      Thus, it really depends who one sells to. If one sells to the wrong owner, it won’t take long until he transfers the R&D resources to his own HQ and reduces the Greek operation to an operating shell. Well, that would be a self-goal. Austria had enormous privatizations over the last decades. Most of them went very well but there are a couple which would fit the above description. Whose fault? Well, those who handled the privatization.

      I would say the most important aspect of a potential new owner should be a long-term commitment to Greece, a commitment to GROW the operation, perhaps advance it to some regional status. And then, of course, all the areas where he can offer know-how transfer.

    • @Klaus

      On privatisations. It is not correct to claim that resources do not disappear. Most privatisations are of services, whose capital stock should not remain fixed if they are to continue to provide reliable services. The evidence from the UK (I cannot speak about Austria) is that some of the privatised services — water in particular — failed to invest and left consumers without service. At least the public ownership of what should be public goods is accountable through broad democratic process: when the private sector, especially foreign-owned companies, fails to deliver, then there is little recourse. The same happened with the security for the London Olympics, where the private sector company decided that maximisation of profitability required paying 50% of the normal rate for trainers, and failing to recruit enough security personnel. The taxpayer was left with picking up the tab, and apparently a minimal penality for G4S.

      So, sorry to contradict you, but the evidence is that privatisations are not cost-effective and frequently damage the quality of important public services. Personally, I do not want to live in a second-rate imitation of the USA, which is what the UK has turned into with the crass commercialisation and privatisation of all and sundry.

    • I don’t disagree with you. In a perfect world, there would first be a national consensus which services should be provided by the state and which could be privatized. That, of course, never happens in practice. What you describe about a utility no longer investing enough under private ownership (of which there are many examples!) is the same thing which I called a multinational taking all national R&D resources back to its HQ. To dogmatically say “privatizations for the sake of privatizations” is not my dogma. My dogma is to privatize where there is significant potential for know-how transfers in all areas (management would be one of them) and where the new owner, who might be a Greek as a matter of fact, has a long-term commitment to the economy.

    • First of all the power companies, water companies etc are not the government’s to sell, they belong to the taxpayer.

      moving on from that, I looked at prices for electricity from the 80s and now and the price is no different, the difference now being that the profits go abroad.

      In short, i cannot see the benefit of the privatisations for the people, they only benefited the government balance sheet in the short term.

  • That’s why a Debt Jubilee (being in the bible) could have a chance.
    But for the elite this suffering is transfering a lot of property into their hands. As soon as Greece has a new currency it will be a devalued one. Greek elite (with their money in safe havens) can than buy very cheap Greek property!

    • Will – “A Modern Debt Jubilee (quantitative easing for the public) would be a nice idea for the RED button.” This is what would happen if countries were allowed to default. ie quantitative easing for the public through mass bankruptcy. (There would be no social stigma because most people would be declaring bankruptcy)

    • @Wil Bremers:

      It is interesting since you mentioned religion in this context to remember that most of the witch hunting happened in the northern realm of Europe and not in southern Europe! And most importantly it wasn’t just catholics but mostly protestants in Switzerland, Germany, Holland etc. engaging in cruel and bestial torments against alleged witches!

      So punishment and torture have been a common religious denominator of both major confessions in northern Europe.

      Beside that one needs to remember that Luther himself was everything but on the side of the poor people during his reformation. When the poor peasants revolted in Germany he condemned them and their revolt in the harshest possible way, so he was suggesting that they all need to be bestially slained by the rulers since the peasant revolt was against God’s laws!!!

      What a great humanist this Luther was!

      Merkel is just a good protestant in that respect I guess 🙂

  • Since this red button doesn’t do anything to tackle the root causes of the GIPSIFs problems, the ugly head of overdebt would show up again pronto.

    So, Yanis, how often would you want the chancelloresse to push this button, every other year or so?

    You just don’t get it: the Germans don’t want to punish anybody. They just don’t want to be the idiots who pay for the constant recklessnesses of others.

    • You are still resisting my experiment. Assume that the red button would fix the underlying problems too. Would the median German voter want Mrs Merkel to press it and thus end the Crisis without any penalties for Greeks? Would you?

    • Oh, I see, your saying that the whole thing is simply to punish Greeks and nothing to do with anything else.


      I think the idea is a bit too abstract to think about.

      Maybe if we coined the scenario in another perspective.

      If the Greek politicians had the red button, would they push it or would they push the orange button and blame Germany LOL!

      In all seriousness though, I think this is the real question

    • “Assume that the red button would fix the underlying problems too”

      In this case, and only in this case, yes, I would want her to press the red button.

    • Instead of adding “properties” to the red button, you could have just state that you’d want Mrs. Merkel to hit the yellow button

    • No we want to see the ClubMed suffer. Only then will they learn not to repeat their mistakes. It is like teaching children.

  • Yiannis, I think you are on the verge of a break through!

    Your article almost hits the issue on the button.

    Merkel of course would also take the red button.

    The difference is that the red button in the USA and the UK do vastly different things to the red button in Germany.

    The people that built the red button in the USA & the UK believe prosperity can come from a printing press which is obviously utter garbage.

    Merkel on the other hand believe prosperity can only come through increasing the efficiency of the economy. Which I personally believe is 100% correct.

    We have seen what money printing has done for the USA and it is absolutely zero. Trillions of dollars have only succeed in increasing the debt.

    The great thing about Germany’s red button is that is also leads to “a sudden collapse of debt for each member-state to below the Maastricht level, no pain for Greek citizens” through a default, the benefit being that debt does not increases with Germany’s red button and at the end you have a sound currency and sound countries. Unlike the US’s red button.

    Why Germany is perpetuating the situation is beyond me. Its almost as if Merkel is pressing the orange button and going against the principles she says she stands for.

    • You could have just said: “I would urge Mrs. Merkel to hit the yellow button”

  • you are right Yanis, the subaltern German people have been told for decades that they have to suffer in order to be competitive, so they – the so called kleine Leute – have been imposed upon ‘reforms’ which essentially consisted in massively deteriorating their standard of life, in transferring power and wealth from bottom to top. But, as the narrative ideologically implied, it was individual (at the bottom) suffering for the nation’s, the standort’s (the top), sake. Trapped in that self-castating narrative, they are somewhat rewarded with the belief of belonging to a particularly virtuous society, a belief which necessarily implies a profligate other. Such symbolic dichotomy being so deeply rooted, taking the second choice becomes a necessity, in oder to maintain the difference between the virtuous and the vicious. The vicious has to pay, and in order to do so, the virtuous himself must be prepared to suffer the consequences. It’s the very normal insanity the powers that be rely upon.

    • That is a very wise remark, salvo. Add to this a certain indifference concerning economics and politics (with postmodernism indifference was growing stronger and stronger since nearly a decade now – and quite a few people, an intellectual majority at least, felt “cooler”. They somehow thought they’ live in a world where nothing could go really wrong for ever – and they thought they could play their own games, kind of solipsistic ones, or think about such things for example Terry Eagleton describes in his great “the illusions of postmodernism” – a book which I should have known about many years before^^.).

      And add the power of many media in times where basic fundaments of “what do we wish just societies to be like?” are often missing among what you call “kleine Leute”. Kleine Leute and grosse Leute can this way in our times be persuaded that “the others” are to blame. We even read it in these very comments over the months here… Not entirely new of course, but always something that works.

      But now I read your great remark before I read Yanis post – which I’ll do immediately. Every idea about how to come nearer to a fair solution (or what would still be best) after this mess instead of ongoing “Stillstand” (stagnation) can only be something good!

  • Dear Prof,

    speaking of “a magic bullet to be presented on a silver platter” I think I have to propose one!.
    I’ d like to have your comment on my proposal posted at: gobanknoteless.wordpress.com. It seems too good to be true but up to now there has not been found any fault!
    I understand that it will take a great deal of European legislative work to be done but I believe that as soon as something like this is decided, the whole situation will turn over towards a very optimistic future with all favorable results counting from day one.
    A last remark: My proposal is exactly what and only what it contains. I am sure you will not confuse it with some ideas about local currency etc. I speak for the Euro as it has been established in the first place.
    G. Oikonomidis, Larissa, GREECE

    • Interesting proposal, it would be good to get some comments.

      I seem to remember from by history lessons in high school that the ταλαντα ( talents, money in ancient greece http://en.wikipedia.org/wiki/Attic_talent) were on purpose big and heavy so they could not be easily carried and accumulated.

    • Dear anna,

      thanks for the answer. You are right. Lykourgos in Sparta introduced heavy iron coins to prevent extreme wealth to be concentrated. Nowadays of cource the situation is tottaly different.
      You can find all comments I have received at gobanknoteless.wordpress.com, my answers allong.
      Happy to have any help in my try to spread this idea.

    • “Lykourgos in Sparta introduced heavy iron coins to prevent extreme wealth to be concentrated. ” – i dont know the history but this action would lead to extreme wealth being concentrated because employers no longer had to pay their employees in Gold/silver etc etc

    • How do you conclude that employers will not pay their employees?
      Any way, I long for having your opinion on the core of my proposal.
      That is : having no paper money of big value, will or will not we live in a society with no tax evasion, no violent robberies and no illegal immigration? This is the question and this is where we must concentrate on. Please either find out the flaw in my idea or other ways spread the word to whomever could possibly help this idea into being adopted and implemented

    • You said – How do you conclude that employers will not pay their employees?

      I originally said – because employers no longer had to pay their employees in Gold/silver

      because you said – Lykourgos in Sparta introduced heavy iron coins (ie he made currency out of something next to worthless which is almost as bad as what we have now)

    • Well, OK about iron/ gold / silver.
      I ‘d really want to know what do you think about the idea of no more using banknotes. And I mean not on a voluntary basis, but officially, abandoning them by a new European decision (well a whole bunch of decisions…).
      This will give Europe quite a thrust ahead, won’t it?

    • I think currency should be anything that works. Notes, bitcoins whatever. Independent banks should be free to come up with anything they think will work for them.

      I think currency should be regulated by the customers and not the government. And yes, I think it would give the EU a massive boost.

    • Well sure currency could be anything that works.
      Anyway we can’t ignore the main role of a country’s official currency.
      If government “prints” no banknotes, and makes all it’s payments through bank accounts, I don’t think any other currency could really prevail in the every day life.

    • gobanknoteless – you highlight a major flaw with a paperless, coin-less currency, the government could easily commandeer it.

      I change my mind, paper and coins are the only reliable currencies, as long as they are issued by private banks.

      Electronic is too easily controlled and/or too easy to seize.

    • 1. I don’t say coin-less currency, but this is not the main thing in your specific observation
      2. I think that apart from the technicality of who is issuing the money – be it a private bank as you say – I do not think that in any country this is out of government’s control. That means if the government decides lets say to change the currency in circulation it has the power to enforce it. So we came the the point under examination: Do you find useful what I propose?

  • Dear Yanis
    I think what a majority of people in Germany think is something like this:
    In relationship to the total amounts involved in the Eurozone crisis, the economy of Germany is relatively small and would be unable, even if it were willing, to guarantee payment of the sovereign debts of the rest of the Eurozone as Spain and even Italy and France are added to potentially defaulting nations. Thus, German participation in rescue efforts are conditioned on negotiation of Eurozone reforms which have the potential to resolve the underlying imbalances which are driving the crisis.

    This may be a mistake or not – probably nobody really knows. But it is what most Germans think.

    I think Germans are very sceptical that Germany can do all that is expected from it by the southern European countries and the US and UK who are very quick to ask Germany to just go ahead with it and spend or guarantee hundreds of billion of Euros when they themselves are very reluctant to help at all.

    Here are some articles that argue in a similar direction:


    • Martin

      “which have the potential to resolve the underlying imbalances which are driving the crisis.”

      The underlying imbalances for the EU crisis are not and never were the individual problems of any country. Many reforms are excellent and very needed. But they are only a cover up. The IMF itself in a way has admitted that ,since noone can implement all the reforms in the time asked. The “Bravos” received for reforms are not because the crisis is being resolved but because more control is being given elsewhere.

      Whatever you said is self-defeating. Yes ,Spain and Italy are in deep trouble no matter the reforms.

      As in any crisis ,there is the opportunity to pass policies that have nothing to do with the true causes of any crisis.

      Also ,the people do not want to ask anything from Germany. So ,instead of being here ,go to a blog that Germans talk against their government’s policies and of the other governments’ complacency as well.

      It is that simple.

      Last but not least ,guaranteeing was a good idea at the beginning and it not always has to do with actually giving money. It has to do with calming the markets. The markets your own government disturbed together with the help of our very own GAP.

      In a crisis someone will always give money. ALWAYS. It is the use of the money that matters. ALWAYS.

      In calm markets ,problems are easier to handle.
      We would have never ever had these problems in such a degree.

      But someone had to take the blame for the EZ multi-trillion inanities.

  • Christos Papadopoulos (2nd year Dphil student, UADPhilEcon, University of Athens) says:

    The two buttons are just two extremes of a linear system. That points have meaning only as parts of a convex basis, in which the nexus among the two points is always feasibly. By linking the two extremes, we have the ability two grasp the “gravity” power of each point and so to have an objective estimation of their potential effects. In the EU case, such a basis does not exist, hence there cannot be a linkage among the two extremes. EU authorities act under conditions of full or partial ignorance, whereas US & British authorities act, (at least), under conditions of risk. Risk is something total different from ignorance. Risk can be measured in a convex system, but ignorance cannot.

  • When a race car driver’s speaks of a Spanish-Italian-Greek victory over Germany on his winning speech you know there’s something much deeper than finance broken in Europe.

    Hate to give you credit for this professor but you saw it coming.

  • Yanis, this mental experiment is really powerful and very spot on! Someone can already see results from the comments in this post of people that would go for the “yellow button”

  • I think that the average German voter would of course support Merkel pushing red button if that would not imply extra hardship for the people of Germany. Because you already made a disclaimer that it won’t and because I am also familiar with the Germans, I cannot possibly see why would they not be for “the red button”: the magic instant solution to all problems. On a different note: I think that the problems of greater Europe cannot be solved by monetary measures alone, by increasing or decreasing fiat money supply and so on and on, for example a moratorium on imports from the Far East (the EU is now the largest importer from China, the US comes in second), no matter how called and in how disguised, for some reasonable term, let’s say 40 years, would wipe out the unemployment and revive manufacturing sector, not just in Europe but even on its exterior periphery, perhaps even in launching modernization of Africa. So this is one measure. It is effective, simple, makes good economic and strategic sense but is of course (at this time) unacceptable on the ideological grounds. The EU needs to divorce politically from the United States, stop supporting America’s endless wars of aggression, it should not fund existence of new ethnic satrapies like ethno-fascist statelet of Estonia or (now largely self-depopulated) Latvia, it should become more democratic – one person, one vote, a German voter should not “weigh” less than a subject of a small statelet (which, in some cases, like the ethno-Nazi satrapies in the Baltic, totally undemocratic), boost its competitiveness internationally, offer Russia ways to integrate within the union because together with Russia the rest of Europe are self-sufficient but it is difficult to do now because the political decision making has been hijacked by ideologically motivated pro-American puppets and by Eastern European ethnic satrapies. Let’s get back to the Red Bullet, I think the role of Germany should not be exaggerated. How come Merkel would have that red button to push? She is not the president of the EU. German political power is diluted in the union. I have no idea why Germans consented to being so mistreated and discriminated against in this ugly historical experiment. In any case, the European Union has its own president, Herman Van Rompuy (I guess he is a Belgian though I am sure most Belgians have no idea who he is), so you’d need to take your golden platter with the silver bullet or the magic button to His Excellency. I am sure he’d push anything he is ordered to.

  • Its unbelievable really.

    historic illiterate , pointing the finger to greeks

    Lets forget the billions u own from ww2 to us as war payments

    but the biggest debt transgressors of 20th century talking bout responsiblities and punishment is utter bs

  • Greece reportedly faces IMF aid cut-off


    Debt crisis: Greek economy is in a ‘Great Depression’ says Samaras




    “Money, Banking and the Federal Reserve”


    FEDERAL RESERVE statistical release



    Audit Interview: Mark Pittman


    ‘The mob learned from Wall Street’: Eliot Spitzer on the ‘cartel-style corruption’ behind Libor scam


  • I think the button most German voters would really want to push is the “leave me alone” one. If you could force them to choose between your red and yellow options, and succeed in explaining them, then they would press the red one, some of them may be grumbling as they do it but still do it nonetheless. That was basically Kantoos’ point and I think he’s right on that one.

    Merkel would also press the red one too and be relieved, the outcome and her political talent being more than powerful enough to put down the few “but you should have pressed the yellow one” voices. That is, whatever the German public thinks now, she could convince them that it was the right thing to press the red one after the fact. That’s closer to how representative democracy works: people choose the people who press buttons, not vote for which button to press on every single issue (imagine the mess).

    A revealing issue is perhaps when you talk about “the German public has become convinced”: you seem to imply that the eurozone crisis or the Greek situation is something Germans think about all day and have a definite opinion about. Notwithstanding silly posturing in newspapers and sometimes in parliament, the euro crisis is a very distant topic that has no visible direct impact on daily life in Germany, and most people don’t care much either way, and whatever opinion they have is likely to be very vague, as suitable for something which is in a very distant position on their list of worries. It’s just not a topic of conversation that comes up often, and if it does the conversation tends to move on to football or whatever else pretty quick.

  • I think this is a great mental experiment, dear Yanis. I don’t think Merkel would push the red button.

    Merkel always asks the polls for short-term decisions. Then she asks, for serious questions, and this is her policy for Europe – what a “market conform democracy” (her words, marktkonforme Demokratie), meaning the 60-70% richer Germans would need.

    On a sidenote, just ignore this if not interested:I am not so sure about old chancellor Kohl (1982-1998). Economically a right-wing man as he was also (both CDU), if in your experiment a good european friend would…. kindly ask….well….then….
    Surely nobody like Tsipras. Beware. Kohl would, without exchanging a word with him, call him “a red monster” or “the new Goebbels” (something he did name Gorbatschow at first; later he became a friend of his, but most ennemies stayed: ennemies for life.).

    If Kohl would have happened to like the new greek finance minister, your colleague – he might – don’t laugh – have invited him to Palatine, his [and my^^] home area. The minister had to smile very friendly while enjoying palatine white wine and eating “Saumagen” (which, if you eat meat, can be tasty if somewhat – strange at first). After that and a few glasses and a view around the sunny landscape of his home Kohl might have said:

    – Stournaras, my friend, we drink to your health – and I’ll push this red button!

    A few tears would maybe roll down Kohl’s cheeks, he was truly great at that and nobody knew if he was convinced of his own greatness – or if he just could be such a fine actor.
    And he’d call, immediately a magazine (by no means der SPIEGEL – heaven forbid, in his times that used to be liberal-left-wing, he ignored them – he would not now, that’s for sure^^).
    The magazine (BILD, whatever) would send a crew, and they’d film and report about Kohl generously pushing the…..(choirs from heaven here….) *red* button. Not alone, that would be too simple! No, together with his new friend Stournaras. A nice addition to his personal gallery that would have made – Kohl with Mitterand hand in hand, with Reagan ditto 1985 in Bitburg, with Stournaras hand in hand pushing the red button to find a solution for this mess.

    He’d give an interview later, looking somewhat strangely to something left above of him always, and say, maybe: “I know Germany would have profited from the yellow button also. But I am the founder of Europe (a tear…), and I think my friend Stournaras and myself did the right thing!” Stournaras would have to smile broadly, and this way the red button would have been pushed. Even if Merkel and Kohl would share nearly the same political ideologies…

    back to now….
    Merkel would, in the end, find a new dazzling few sentences of how great the yellow button was (she is not an emotional politician like Kohl was or could play). She would maybe say (please excuse my mild irony, I have to live here since such a long time amongst not too many really politically interested people^^):

    “We will now puss de yellov baton (voice is rising from we till “baton”) – be(deep) cause (high) “there (deep) is no (high) “alternative!!”
    Then she always smiles very very drily into the audience, and takes her papers and goes away. Tough Mama some call her, others (silently) praise her abilities to stay in power in a party that always was ruled by men.
    Every – each and every – politician of some liberal-left would be punished by nearly all media after a single appearance like Merkel showed us a thousand. But the media do not criticise her….in no way…. They treat her like you are supposed to treat your always caring and loving mother.

    A few days later papers would report (accidentally this happens right now, since around July 21 ) that “people” or “Germany” would “lose patience now with Greece”.


    For the average “not so interested” Germans it is a desaster. Would Merkel be Kohl, 70% would indeed praise Merkel after whatever button she chose….with all the prejudice deeply implanted and living inside our humble not-so-informed 80%.

    The prejudice in them says “we” are working hard, “they” only lie in the sun – “I must know because in Greece I did just the same – lying in the sun and relaxing.” (I indeed heard this sentence in reality a few weeks ago).

    Merkel did not ever, not ever one single time, say something against this. She knows better, of course, but not a word.
    70% of Germans praise everything she does, a miracle Berlusconi somehow similar experienced for some time in Italy. Berlusconi maybe due to his media power. Merkel due to “Zeitgeist” and because whatever she does, nobody who does not want to lose readers dares to criticise her at all.

    Following your mental experiment – one statement of Merkel like:
    – The reasons why it came to this Crisis are manifold. Please let us see the whole picture. We, germans, benefit – absurd as it sounds – from the Crisis now, but we are all Europeans, and nobody of my noble german people would ever want that a single person in Ireland, Spain, Greece could not afford to be treated with the right medicine if dangerously ill! Humanity and acting economically wise in times of a Crisis always come first, let us all work for this”
    –> Herr Sinn would protest, Herr Hundt would, and Herr Olaf Henkel would (and many inside FDP and CDU and SPD and Grüne).
    —> 70% of people would praise her, as always….
    This was the possible solution in times of media-democracies that Germany would decide to press the *red* button… Kohl would have pressed it 75%, Merkel as she is 0%; but nobody can say she had no choice. She can – nearly – do everything and stay in power for a while…
    It is sad, but as postmodern media-societies are nothing whatsover for example Hannah Arendt dreamed of (aah, highly politically skilled wise people were her dream, intelligent, enlightened…) – there is a chance for poilticians that can be described as “media-conform” or “charismatic” – to really act the way they like. Parliaments then agree….and the red button would not be illegal in the least, no judges would probably say “no”…
    Even politicians who are not a bit charismatic (Merkel certainly is not, and this is not speaking bad about her, this is reality) – but are praised as “our mother” or however can play to be charismatic – and decide much more than, in her own false words, the “no alternative” ways…

    I end this as per usual too long comment by adding – if Obama would be in Europe, the USA being a european country, I am not 100% sure if he’ press the red button. “America first” is such a strong influence, and there are elections soon. But I do get your picture, of course.

    • This story was fun to read, not least because it has no connection whatsoever with reality 🙂

    • Think of it as imaginary numbers. The sq root of -1 does not exist but it is terribly useful in all fields of engineering. Similarly, my mental experiment is imaginary and unreal but, on the other hand, it is terribly useful as a means of gauging the mood of the nation.

    • Dear klemperer85

      I like your story, especially the picture you paint of Mr. Kohl and how he would have handled this crisis if he was still in power.

      After all, it was Kohl and a few others that chose the path towards the Euro and it would take characters like him to make this work.

      On the othen hand, maybe the Euro project was doomed from the beginning and we were just having a good few years before the inevitable started to happen in 2010.

      Here’s an article that is very critical of the EU elite that pushed through the introduction of the Euro without properly thinking about the consequences before:

    • @klemperer85:

      “Marktkonforme Demokratie” alone is such a disgrace if one really thinks about it! But as you so rightly said in another of your posts the problem is that 80 percent of the German population is uninterested in politics and has no clue about what really is happening!

      Kohl may have had many negative aspects but he was a real European! He had a dream of Europe with Germany beeing a part and centerpiece of this Europe. We can crtiticize him in many aspects but he was a true European with a vision for both Germany and Europe! That is the big difference between him and his “Mädchen” Merkel!
      Merkel is just a Machiavellian power seeker without any dream or vision or anything like that!

      “The prejudice in them says “we” are working hard, “they” only lie in the sun – “I must know because in Greece I did just the same – lying in the sun and relaxing.” (I indeed heard this sentence in reality a few weeks ago). ”

      Yes we have all wittnesed this “nice” German prejudice and discrimination of all Greeks and all the other Mediterraneans! But wow hell breaks loose if we call the baby what it really is namely modern day GERMAN RACISM!!!

      ” It is sad, but as postmodern media-societies are nothing whatsover for example Hannah Arendt dreamed of (aah, highly politically skilled wise people were her dream, intelligent, enlightened…) – there is a chance for poilticians that can be described as “media-conform” or “charismatic” – to really act the way they like. Parliaments then agree….and the red button would not be illegal in the least, no judges would probably say “no”…”

      Call it what it is really: Call it post-democratic media and finance directed societies!!!
      We have no real democracies any longer not in the EU and neither in the US!
      It is all just a pale reminiscence of a democratic past.

      “Even politicians who are not a bit charismatic (Merkel certainly is not, and this is not speaking bad about her, this is reality) – but are praised as “our mother” or however can play to be charismatic – and decide much more than, in her own false words, the “no alternative” ways… ”

      This is really funny with Merkel “Mutti”: The Germans seem to have given up the idea of a Führer and have instead endorsed the idea of a great Mother of the German nation 🙂
      So God saves our great German Über-Mutter Merkel!

      Welcome to post democracy!

  • I live in Germany and my feeling is that not more than 30% of the German voters would go for Red button. Neither the politicians would do it.
    There is no question that Germany is a very important country and that German people are honest, reliable, hard working, and EFFICIENT (something that the Southerners should not forget)…
    The problem is that GERMANS CANNOT BECOME LEADERS and the reason is that their model is INCOMPLETE. The saddest side of this crisis is that Germany emerges as a model, compared to countries like France and Italy. However those countries with their flows, had an overall contribution to mankind which is far more positive than the ones of the Germans. This is a big shame…
    For a variety of (historical, geographical, etc) reasons, Germany next to these countries is just a boring place, where life is approached from a very narrow perspective that cannot relate to Europe in general. Nobody in Europe wants to be German and most of the others Europeans respect them, but they don’t like them! And the Germans keep wondering why…
    France could lead Europe because it is more cosmopolitan and sophisticated society, but it is decadent. As all Europe is… Unless we really respect each other, we will start eating other soon…

    • Maybe France can lead the ClubMed & it become what the funny nickname suggests. A vacation resort, like the dominican republic. You can send your kids to th Zimbabwe school of economics for leaders in money printing.

      Germany & the rest of the North plus Hungary, SK, CZ & PL will return to be sovereign countries in a free trade zone. The French & the South annoy most people in these countries anyways.

    • “Unless we really respect each other, we will start eating other soon… ”
      Perhaps you should lead by example.

      Do you have any academic papers or other facts to support your claims, or do we just have to take your word?

    • I think you are right, this is my impression too after living and working in Germany. I have lived in 18 countries on different continents – and Germany was the only place where I felt entirely cut off from the rest of the world, absolutely isolated.
      Your comment that Germans are not leaders is non-PC but spot on, to which I’d add, “except inside Germany”.

    • @Michalis:

      Your post is spot on! Germany can’t lead Europe and this is because Germany is “Seelenlos” without a vision or a dream as a state and a nation!

      In the past the German “dreams” were purely nationalistic and mostly at the expense of all others! Historically they have never felt as Europeans.

      You can’t build big nations, unions etc. purely on rationalism and protestant piety:-)

      Merkel and the German moralizing isn’t good for a united Europe! It is just tearing Europe just further apart!

      Another two years with Merkel handling the crisis and the EU belongs to the past!!!

    • vss

      “Are you on drugs?”

      Let me check.
      Hey ,Michalis did you breath a lot of German air?
      Be careful man.

    • Dear Aristoteles

      You wrote: “Germany can’t lead Europe and this is because Germany is “Seelenlos” without a vision or a dream as a state and a nation!

      In the past the German “dreams” were purely nationalistic and mostly at the expense of all others! Historically they have never felt as Europeans.”

      That is a lot of statements mixed together.
      First of all you are right when you assume Germans can’t lead Europe. We don’t want to! Maybe that is a mistake but – probably as a lesson from WW I and II, there is no will to lead / dominate the others in the German society. Which is why allegations such as we are seeking dominance is met with surprise by most Germans.

      The last big “visions” on German soil were Communism (died in Eastern Germany in 1989) and Nazism (wich died in 1945).
      So, maybe understandably, Germans’ hunger for grandiose visions is small. We’d like to live in harmony in a prosperous, democratic Europe. That’s all. No communism, no nazism, just regulated “social-democratic” market economy is what most people want. Call that boring if you like – but I am happy about things being like this.

      To state that German dreams historically were purely nationalistic and that they never felt as Europeans is a very courageous statement. I can kind of understand that statement when you look at Germany from, say 1871 onwards. I would not agree but you can see it like that. But before that, this statement makes no sense. And after 1945, it also does not make too much sense.
      What you may forget is that “nationalism” was a phase that Germany joined in quite late: When it became a “nation” in one country (with Austria separately running it’s multi-ethnic empire together with Hungary), France and England had been “nations” in the sense of fairly centralized countries for a while.
      Germany before 1871 was weak, very decentralized and the opposite of “nationalistic”. I am positive that people felt “European”. Most people were poor peasants and probably did not think that much about geopolitical issues. But they went to Church and their identity was probably (kind of in that order) Christian, living in their respective principality, living in the “holy roman empire of Germany” and ultimately European (what eles?).
      They took e.g. part in crusades – which is nothing to be proud of from today’s perspective – but it goes to show that there was some identity as christian Europeans, not primarily Germans at that time.

    • @Martin:

      I was refering to Germanys more recent history in the first instance and not that much to the early history of your nation!

      Having said that though, just think about Arminius (aka Herman the German) and the constant fights and wars between the Romans and the Germanic tribes and you will aknowledge that even during that ancient time most of your ancestors were not really supporting a united Europe (albeit under Roman leadership) 🙂

      Even later on Charlemagne had to use brute force in order to subjugate most parts of modern day Germany so he could unify most tribes and build his Frankish Empire which later transformed into the German First Reich!

      Anyway the current problems have mostly to do with the stance of the German elites and just to a lesser extend with the attitudes of the German people! So if at all it is the lack of visions and a European identity of your current German government, media and to a less extend parts of your industry!

    • Aristoteles ask the French and the Germans if they want to get rid of the national state and be part of a European state. The result would surprise you. The french would even give up the Ikarus for for that.

    • Eleni and Aristoteles thanks for the support in this flood of irony (I still didn’t understand what is the opinion of Demetry, Very Serious Sam, etc).
      What i wrote comes from personal experience and was confirmed by Eleni who also has been here. It also also partially confirmed by what Martin wrote that ‘Germans don’t want to play any leading role’.
      They don’t, but their leaders and their multinationals do. They set up this common market, so that every body will buy their products. They force EU regulations for ‘green’ houses, so every body will buy their materials and know how. And so on… They are leading Europe, but in a narrow minded way without understanding the particularities of each country. And that brings disaster…
      Of course it is not easy to lead. And of course I have nothing against the people (that would be stupid), only about their system, for which a big part of Germans are proud and nationalistic (and a significant part just wants to put aside and keep on living).
      Now, see how everything fits together. Eleni wrote that Germans are cut off from the world (which I confirm), Martin and other people in this forum wrote that German people don’t want to lead anybody and want to be left alone. And at the same time everyone in the planet believes that Germany leads Europe and is responsible for not ending the crisis. Isn’t this a paradox?

    • “They (German leaders) set up this common market, so that every body will buy their products”

      Sorry to disturb your prejudices with facts, but

      1st it was France, not Germany, who demanded that there will be a common currency. Which by design removed the ability of the sovereign nations to devalue in case of need (which is since a few years the case in Grece, Spain, Italy, France, Portugal, Ireland)

      2nd no member of the currency union was forced to join it. It was the decision of each sovereign nation, vie the ruling ‘elites’, which were in free and democratic elections elected by the people. Actually, some nations even found, to put it mildly, creative ways to be allowed to join, despite being far off the required economic marks. Greece, for instance.

      So would you pls. finally accept reality and stop to blame the Germans for things that were not and are not attributable to her?

      Thank you very much.

    • VSS, well said, if I can just add, “starting blaming the Greek government, they are the ones imploding the Greek economy in order to vilify Germany.”

    • Michalis

      I agreed with you.
      My ironic comment was towards vss ,not you.

    • vss

      “So would you pls. finally accept reality and stop to blame the Germans for things that were not and are not attributable to her?”

      And you should do the same. Everytime it seems we agree on something ,at the last minute you twist it to exonerate your own government from everything. And the worst ,you are one of the few that have attacked personally the Greek population for everything.

      So ,your request of others accepting reality is somewhat atopic.

  • Yanis, you are largely right, but let me add, the German electorate has been made to believe the narrative you describe, it was not their original idea, or it could have accepted a different narrative.
    It was the populism of Ms.Merkel herself, a shame for a German chancelor, which created the mindset, that you describe. So Germans would not have terrorised Merkel for pushing the red button, IN THE BEGINNING. But now, after two years of shameless populism against Europe’s south, of course you are right.

  • Yanis, let me also add one thing. After a banking crisis of this kind, in the course of which ordinary people have been reading about bankers who *created* maginary money, almost out of nothing, as if they were masters of the universe and than let the money disappear again, with them – the ordinary people – having to pay the price, people are sick and tired of “sophisticated” solutions. They don’t trust them any more. They long for common sense to reign the world again. I don’t justify this thinking, I just try to understand it. In this light, yes, your modest proposal seems to people to easy and too painless to be true. People just *feel* or that again somebody will have to pay they price as it has alsways been the case in the past.

  • Personally I think the majority of Germans asked the red button to be pressed if and only if they would be 100% sure that not even one euro would be given to the periphery after that, neither as a gift or a loan.

    This is my hypothesis about the German “mood”: in my opinion is not too much that they want others to suffer gratuitously because they see them as immoral/sinners, it’s much more that they don’t trust any more the periphery and yes, because they perceive people in the periphery as “immoral”, they are not ready to share even a cent with them in order to help them getting out of their trouble. Given this lack of trust, whatever plan is presented with the label “this won’t make you pay for them, but we all will be able to become richer without you having to give them a cent” isn’t trusted.

    And this is actually the kind of propaganda they were exposed to, if I remember well “They want our money” was one of the many propaganda titles by the Bild. Also pay attention to which media shaped the German propaganda, both on the tabloid side, like Bild that had make a leaving by the leverage of the human passions, or on the pseudo academic side with people like Sinn spinning fantasy numbers about how much money the Germans are *already* giving to the periphery, in order to ride the wave of outrage and, I guess, getting a place in the CDU establishment, or just getting some fame.

    Nevertheless in my opinion remains that it’s more a matter of lack of trust than one of gratuitous desire to punish. Of course there is the desire to punish, but it is intended as a retaliation (in some case a preventive one…) in order to avoid others to get easy money from us who worked hard for getting them.

    According to this, if a pollster ever tested Germans mood in this way, I would ask her to make clear as much as possible that the red button gives richness to both Germany and the periphery without Germans to lose even one cent or to give it to the periphery, because for me it remains that the key point is fear to have pay, and in particular to have pay for other people mistakes.

    • How can you expect trust if Greece breaches all agreeements. Not slightly, but by far….

    • @Mr. Violet:

      “Also pay attention to which media shaped the German propaganda, both on the tabloid side, like Bild that had make a leaving by the leverage of the human passions, or on the pseudo academic side with people like Sinn spinning fantasy numbers about how much money the Germans are *already* giving to the periphery, in order to ride the wave of outrage and, I guess, getting a place in the CDU establishment, ”

      I want to add just one thing here! The propaganda may have been driven by right wing media and newspapers but at the end of the day one can be assured that it was initiated and endorsed by the two goverment parties (CDU and FDP) plus some very powerful and influential circles like the Deutsche Bundesbank which is also shining through in Thilo Sarrazins racist tirades!!!

      Bild, Focus etc are not acting on their own, they are part of a bigger German establishment!

  • Ψυχολογικά πειράματα κοινωνικής συμπεριφοράς

    Από την πληθώρα των πειραμάτων που έχουν εφαρμοστεί, το πιο εντυπωσιακό ως προς τα αποτελέσματά του είναι το περίφημο πείραμα του Μίλγκραμ. Ενός κοινωνικού ψυχολόγου που πίστευε πως η αλήθεια για την καταστρεπτική υπακοή στην εξουσία εξαρτιόταν λιγότερο από τη δύναμη της προσωπικότητας και περισσότερο από τις συνθήκες. Κάθε ιδιαίτερη πιεστική κατάσταση θα μπορούσε να οδηγήσει κάθε λογικό ανθρώπινο ον να εγκαταλείψει τους ηθικούς ενδοιασμούς του και να διαπράξει κτηνωδίες, κατόπιν εντολών.

    Στο παρόν σημείωμα, όμως, θα ασχοληθούμε με την κοινωνική συμπεριφορά του ατόμου που παραπέμπει σε καταστάσεις όπως απάθεια, χειραγώγηση, μίμηση. Σε πόσους από εμάς δεν έχει τύχει να νιώθουμε ότι οφείλουμε να βοηθήσουμε κάποιον αλλά να μην το πράττουμε; Εκτεθειμένοι κυρίως μπροστά σε κόσμο, όπως μέσα σε ένα λεωφορείο, όπου ένα συμβάν απαιτεί την αντίδραση μας, και παρ’ ότι νιώθουμε ότι πρέπει να επέμβουμε με τον α ή β τρόπο, επιλέγουμε την οδό της σιωπής ή της απραξίας. Τι είναι αυτό που καθηλώνει τον άνθρωπο και δεν ενεργεί με βάση τις αρχές και τις αξίες της ανθρώπινης συμπεριφοράς και κουλτούρας; Τέτοια ερωτήματα αλλά και πιο σύνθετα, όπως για ποιο λόγο ο άνθρωπος υπακούει στην εξουσία, έχουν αποτελέσει εκτενές αντικείμενο έρευνας του τομέα της ψυχολογίας. Πολλά ψυχολογικά πειράματα έχουν πραγματοποιηθεί ώστε να παρατηρήσουν, να ερμηνεύσουν και να κατανοήσουν την ανθρώπινη συμπεριφορά. Φυσικά, οφείλουμε να είμαστε αρκετά προσεκτικοί στην αποδοχή των συμπερασμάτων ενός πειράματος αφού πολλές φορές η μεθοδολογία είναι άτυπη, συχνά σε μικρό δείγμα και μη ανεξάρτητο. Ασφαλώς, οφείλουμε να έχουμε πάντα κατά νου ότι αυτές οι έρευνες και μετρήσεις της ανθρώπινης συμπεριφοράς γίνονται μέσα σε μια καταπιεστική κοινωνία, όπου ως ένα βαθμό ο άνθρωπος έχει αλλοιωθεί και αλλοτριωθεί από το εξουσιαστικό συρφετό.

    Το 1964, ένα ιδιόμορφο έγκλημα διαπράχθηκε στη Ν. Υόρκη, το οποίο λειτούργησε καταλυτικά για τους ψυχολόγους Τ. Ντάρλει και Μ. Λατανέ, που ήθελαν να ερευνήσουν τη συμπεριφορά των αυτοπτών μαρτύρων. Οι ίδιοι επινόησαν μια αλληλουχία πειραμάτων με τα οποία εξέτασαν τις αναγκαίες συνθήκες υπό τις οποίες οι άνθρωποι αγνοούν τη κραυγή κάποιου άλλου για βοήθεια, καθώς και τις συνθήκες που πρυτανεύει το πνεύμα ευσπλαχνίας. Το συμβάν-αφορμή για την έρευνα είχε ως εξής: Ήταν Παρασκευή 13 Μαρτίου 1964 και η 20χρονη Κάθριν Τζενοβέζε, επέστρεφε από τη νυχτερινή της βάρδια στο μπαρ όπου εργαζόταν. Στάθμευσε το αυτοκίνητο της και κατευθύνθηκε προς το σπίτι της, στη θέα του υπόπτου άλλαξε κατεύθυνση και πήγε προς τον τηλεφωνικό θάλαμο. Εκεί την πρόλαβε ο δράστης όπου την μαχαίρωσε. Η Κάθριν φώναζε: «Με μαχαίρωσαν. Σας παρακαλώ, βοηθήστε με! Σας παρακαλώ! Βοήθεια!». Αμέσως φώτα άνοιξαν από τα σπίτια σε αυτή τη γειτονιά του Κουίνς και κάποιος φώναξε από το παράθυρο: «Άσε ήσυχο το κορίτσι». Ο δράστης Γ. Μόουζλι αργότερα είπε κατά τη διάρκεια της δίκης, ότι είδε τα φώτα αλλά αισθάνθηκε ότι κανείς δεν θα κατέβαινε τις σκάλες. Ο Μόουζλι απομακρύνθηκε προσωρινά, η Κάθριν σύρθηκε μέχρι την είσοδο κάποιου βιβλιοπωλείου. Τα φώτα έσβησαν και ο Μόουζλι ξαναεπέστρεψε. Επιτέθηκε πάλι με μαχαίρι. Φωνές επίκλησης για βοήθεια από την Κάθριν, τα φώτα ξανάναψαν, ο Μόουζλι υποχώρησε. Αλλά και πάλι κανείς δεν κατέβηκε κάτω, τα φώτα έσβησαν και ο δράστης γύρισε και πάλι για να αποτελειώσει το θύμα και να ασελγήσει πάνω της.

    Το συγκεκριμένο έγκλημα έλαβε χώρα μεταξύ 3:15 έως 3:50 πμ, επρόκειτο για τρεις αλλεπάλληλες ξεχωριστές επιθέσεις παρατεταμένης διάρκειας, παρουσία κραυγών που ζητούσαν βοήθεια. Οι αυτόπτες μάρτυρες, οι οποίοι άναψαν τα φώτα ήταν στο σύνολο τους 38, και οι οποίοι μετά το συμβάν πήγαν και πάλι για ύπνο. Θα μπορούσαμε να πούμε ότι ήταν ωσεί παρόντες. Τις επόμενες βδομάδες από το έγκλημα, επιστολές αναγνωστών κατέφθαναν στις εφημερίδες που ζητούσαν την τιμωρία των αυτοπτών μαρτύρων. Οι δυο ερευνητές του πειράματος αναρωτήθηκαν για ποιο λόγο δεν βοήθησε κανείς, ήταν η απάθεια ή επέδρασαν άλλες ψυχολογικές δυνάμεις; Διάφοροι επιστήμονες ανέφεραν ότι έφταιγε η τηλεόραση, άλλοι η «συναισθηματική άρνηση» λόγω του σοκ που υπέστησαν και άλλοι διατύπωσαν ψυχαναλυτικές εξηγήσεις.

    Οι Ντάρλει και Λατανέ δεν πείστηκαν από τις εξηγήσεις που δοθήκαν, εν μέρει επειδή υπήρχαν πειραματικοί κοινωνικοί ψυχολόγοι, όπως ο Μίλγκραμ, που πίστευαν λιγότερο στη δύναμη της προσωπικότητας παρά στη δύναμη των καταστάσεων. Έτσι οι δύο τους σχεδίασαν ένα πείραμα στο NYUnivercity όπου προσέλαβαν ανυποψίαστους φοιτητές να συμμετάσχουν σε μια μελέτη, η οποία θα αφορούσε στην προσαρμογή των φοιτητών στην πανεπιστημιακή ζωή της πόλης. Φυσικά, αντί για φόνο οι ερευνητές έκαναν αναπαράσταση μιας επιληπτικής κρίσης. Στο αρχικό πείραμα συμμετείχαν 59 γυναίκες και 13 άνδρες, καθισμένοι σε ανεξάρτητα δωμάτια χωρίς οπτική και λεκτική επαφή μεταξύ τους. Ο κάθε συμμετέχων έπρεπε να περιμένει την σειρά του να μιλήσει κατά την οποία είχε χρόνο δύο λεπτών ομιλίας. Ο συμμετέχων πίστευε ότι στα γύρω δωμάτια βρίσκονταν άλλοι εθελοντές-φοιτητές, οι οποίοι μιλούσαν, κάτι το οποίο δεν ίσχυε αφού οι ομιλίες ήταν μαγνητοσκοπημένες. Στην πρώτη ηχογραφημένη φωνή που ακούστηκε ήταν εκείνη του υποτιθέμενου επιληπτικού, ο οποίος «παθαίνει» κρίση και ζητάει βοήθεια. Ο συμμετέχων είχε τη δυνατότητα να σηκωθεί από τη θέση του, να κατευθυνθεί στον επόπτη και να ζητήσει τη παροχή βοήθειας. Το ποσοστό που έπραξε αυτό είναι μόλις 31%. Εν συνεχεία τροποποίησαν λίγο το μέγεθος των «ομάδων». Όταν οι συμμετέχοντες πίστευαν ότι βρισκόταν σε μια ομάδα άνω των τεσσάρων ατόμων, ήταν απίθανο να ζητήσουν βοήθεια για λογαριασμό του θύματος. Από την άλλη το 85% των συμμετεχόντων που πίστευαν ότι αποτελούσαν μέρος μιας δυάδας με τον επιληπτικό φοιτητή, αναζήτησε βοήθεια εντός τριών λεπτών.

    Συνεπώς, η σχέση ανάμεσα στο μέγεθος της ομάδας και τη συμπεριφορά παροχής βοήθειας είναι ακόμη πιο ενδιαφέρουσα από τη σχέση ανάμεσα στη χρονική διάρκεια και τη παροχή βοήθειας. Ίσως πιστεύετε ότι όσο μεγαλύτερη είναι η ομάδα τόσο πιο ενεργητικός γίνεται κανείς και ότι είναι πιθανότερη η παροχή βοήθειας. Το συγκεκριμένο πείραμα αμφισβητεί αυτή τη δυνατότητα, όπως και το ρητό της εξελικτικής θεωρίας σχετικά με την ασφάλεια που παρέχει ο αριθμός των παρευρισκομένων. Επίσης από τα συμπεράσματα του πειράματος προκύπτει ότι οι συμμετέχοντες που δεν αντέδρασαν δεν ήταν απαθή (παρουσίασαν ταχυκαρδία, στρες κ.ά.) αλλά βρίσκονταν σε κατάσταση αναποφασιστικότητας και σύγκρουσης. Επί πλέον για πρώτη φορά αντιλήφθηκαν το φαινόμενο που ονόμασαν «διάχυση ευθύνης». Όσο περισσότερα άτομα παρίστανται ως μάρτυρες σε κάποιο γεγονός, τόσο λιγότερο υπεύθυνο αισθάνεται το κάθε άτομο γιατί η ευθύνη κατανέμεται ισομερώς. «Είμαστε ζώα που έχουν καταδικαστεί να ζουν μ’ ένα εγκεφαλικό φλοιό ο οποίος έχει αναπτυχθεί τόσο πολύ σε σχέση με τον αρχέγονο εγκέφαλο μας μέχρι σημείου να συνθλίβονται το ένστικτο και το επακόλουθο του –η κοινή λογική».

    Εν συνεχεία, οι ερευνητές προχώρησαν σε ένα ακόμη πείραμα. Μέσα σ’ ένα δωμάτιο με αγωγούς εξαερισμού οι ψυχολόγοι τοποθέτησαν δύο φοιτητές-ηθοποιούς και έναν ανυποψίαστο συμμετέχοντα. Οι τρεις τους θα συμπλήρωναν ένα ερωτηματολόγιο σχετικά με την πανεπιστημιακή ζωή. Αρκετά λεπτά μετά την έναρξη του πειράματος, αβλαβής καπνός θα διοχετεύονταν από τους αεραγωγούς μέσα στην αίθουσα. Τότε οι δυο ηθοποιοί θα παρέμεναν ψύχραιμοι και αδιάφοροι, παρότι η ατμόσφαιρα γινόταν θολή και αποπνικτική, προκαλούσε ερεθισμό και μερικοί άρχισαν να βήχουν. Από το σύνολο των συμμετεχόντων στο πείραμα (72 άτομα), μόνο ένα ενημέρωσε εντός τεσσάρων λεπτών ακόμη τρία μέχρι το τέλος της διεξαγωγής του πειράματος. Και όλα αυτά ενώ τα μαλλιά και τα χείλη των συμμετεχόντων ήταν κάτασπρα από το στρώμα αιθάλης…

    Είναι πιθανό, αυτό το πείραμα περισσότερο από οποιοδήποτε άλλο «να καταδεικνύει την καθαρή τρέλα που υπάρχει στα μύχια των ανθρώπινων όντων, μια τρέλα που αντιστέκεται τόσο σθεναρά στην κοινή λογική κάνοντάς μας να προτιμούμε να θέτουμε τη ζωή μας σε κίνδυνο παρά να ενεργούμε αντίθετα με αυτό που κάνουν όλοι, να δίνουμε δηλαδή μεγαλύτερη αξία στα κοινωνικά πρότυπα απ’ ότι στην επιβίωση μας». Οι τρόποι συμπεριφοράς δεν είναι κάτι το επιπόλαιο, είναι πολύ ισχυρές καταστάσεις που μπορούν να αλλοιώσουν και να διαφοροποιήσουν αρχέγονες όψεις. Όταν οι ερευνητές τροποποίησαν το πείραμα κατά τρόπο ώστε ο ανυποψίαστος συμμετέχων να είναι μόνος του στην αίθουσα, σχεδόν όλοι οι συμμετέχοντες εξέλαβαν την ιστορία του καπνού ως κατάσταση εκτάκτου ανάγκης κι ανέφεραν το γεγονός αμέσως. Συνεπώς, μια βασική παρατήρηση που μπορούμε να κάνουμε, είναι ότι το ανθρώπινο είδος των πόλεων παρακινείται από τη μίμηση, άρα ακολουθεί το πλήθος, τη μάζα είτε αυτό αφορά εκλογική πελατεία είτε «κινηματικά» πρόβατα. Μίμηση, δηλαδή, χειραγώγηση, υπακοή, εκτέλεση. Συμπεριφορές που βρίσκουν πρόσφορο έδαφος σε τρόπους και καταστάσεις ζωής όπου οι κοινωνικές δομές είναι πολύπλοκες, πολυπληθείς, εξαρτησιογόνες και ιεραρχικές. Τα πειράματα αυτά καταδεικνύουν με απλό τρόπο, ότι πολλές φορές ο σημερινός άνθρωπος δεν σκέφτεται λογικά αλλά μιμητικά και πρωταρχικά κοινωνικά αποδεκτά. Ακόμη και όταν στα τέλη της δεκαετίας του ’70 φοιτητές παρακολούθησαν σε βίντεο τα πειράματα των Ντάρλει και Λατανέ, γνωρίζοντας όλη τη μεθοδολογία, ναι μεν το ποσοστό αντίδρασης τους και παροχής βοήθειας, ήταν διπλάσιο αλλά και πάλι υπήρχε ποσοστό αδρανοποίησης και αβουλίας λόγω μιμητισμού.

    Αντιλαμβανόμαστε, επίσης, τον χειραγωγικό ρόλο που μπορούν να παίξουν εύκολα τα ΜΜΕ κατασκευάζοντας πρωτίστως μια πλαστή εικόνα του κοινωνικού συνόλου, συγκεκριμενοποιώντας τάσεις και καταστάσεις κατά το δοκούν και αποσιωπόντας άλλες. Αν τα ΜΜΕ περιγράφουν ένα γεγονός ως «μεγάλου κοινωνικού ενδιαφέροντος», τότε ο πολίτης θεωρεί αυτόματα το συγκεκριμένο γεγονός ως σημαντικό, ενώ ο ίδιος σε άλλη περίπτωση ίσως θεωρούσε σημαντικό ένα άλλο γεγονός. Το ίδιο ασφαλώς ισχύει και για τα ιντερνετικά δίκτυα κοινωνικής δικτύωσης, όπου μπορούν να κατευθύνουν τη σκέψη, αντίδραση και δράση των ανθρώπων σε συγκεκριμένες εκτονωτικές καταστάσεις. Και εκτός των άλλων, το άτομο συχνά θεωρεί ότι συμμετέχει στη διαμόρφωση μιας ωφελιμιστικής κατάστασης πατώντας απλά πάνω στις ετικέτες και τα εικονίδια like και προώθηση. Έτσι, αντί να χρησιμοποιείται το μέσο για κάποιο σκοπό, καταλήγει ο χρήστης να είναι το θύμα τόσο του μέσου όσο φυσικά και του σκοπού.

    Αναρχικός Πυρήνας Χαλκίδας


    1. Lauren Slater, Το κουτί της ψυχής, εκδ. οξύ

    2. Σημειώσεις για τον ψυχιατρικό φασισμό, Don Waitz, Toronto, Ontario

    Από τη ΔΙΑΔΡΟΜΗ ΕΛΕΥΘΕΡΙΑΣ, φύλλο 109, Οκτώβριος 2011

    πηγή: anarchypress


    • Demetri, lovely link.

      The Milgrim Experiment is like watching puppies play compared to the social reality in which we live.

      In reality the Experimenter also shocks the teacher if they do not comply.

    • @Demetri:

      “Ψυχολογικά πειράματα κοινωνικής συμπεριφοράς Από την πληθώρα των πειραμάτων που έχουν εφαρμοστεί, το πιο εντυπωσιακό ως προς τα αποτελέσματά του είναι το περίφημο πείραμα του Μίλγκραμ.”
      ” Milgram experiment http://en.wikipedia.org/wiki/Milgram_experiment

      Let me add my thoughts to what has been already described in the various interpretations of the Milgram experiment:

      I would add two additional interpretations:

      A. Societies with a strong tendency to group conformity and with a lack of strong individualistic tendencies (like Japan and Germany in the past) are more susceptible to such deindividualized behaviour! One has to ask how much these group conformity affects still some modern societies!

      B. Societies without a strong moral basis (be it Christian or any other religious or cultural ethical value systems) are also more susceptible to such negative behaviour!

    • Richard

      “is like watching puppies play compared to the social reality in which we live.”

      Look who is talking.
      Is that why you constantly use the “people on a desert island” example?

  • Yanis

    Even if Merkel wanted to push the red button now ,she would have been the victim of her own policies ,exactly because of the reasons you mentioned ,something that unfortunately is entirely human.

    Even if a big enough percentage of Germans exist to think of pressing the red button ,they may not ,because of the preconceived notions and original perspectives toward the southerns ,preserved by the rest of the population.

    Their framework of thinking is established and every action will be dependent on that ,even if reality states otherwise.
    The choice will be a choice of social acceptance and not of objective analysis.

    Those that had thought of pressing the red button will wait to see others make the first move ,without being burdened by the weight of responsibility bestowed upon their shoulders ,feeling that the importance of this decision is spread equally across the population of Germany. Thus ,the posibilities of the yellow button being pushed increase.

    If we take into consideration that this responsibility is thought to be of equal importance to the whole of EZ because of the preconceived notions ,then the weight of this decision is spread across the people of the EZ ,even though the German population has the choice only (in this experiment only).

    The responsibility then ,decreases

    1) even more for those that want to push the yellow button ,by

    a. negative feelings through an established negative feedback loop because of the already established preconceived notions of the inferiority of the southerns ,

    b. coupled with the “diffusion of responsibility” across a bigger number of “inferior” people. Their responsibility is being excused by the responsibility of the southerns ,even if the southerns do not have the specific choice (in this experiment only).

    2) even more for those that have thought of pushing the yellow button ,by increased complacency through fear of social isolation and “diffusion of responsibility” waiting for a bigger number of people across the EZ to share their own responsibility.

    Only worst circumstances that affect a bigger number of people will be the catalyst of change.
    And this is the safety valve of the elite to push it as much as they can.

    • correction

      Number 2 should read: “…of pushing the red button …”.


    • A mental template has being created that gives legitimacy to the elite considering the yellow button.

      This mental construct is a social meme ,a virus ,a living mental organism that wishes to protect itself from destruction.
      Thus ,the creators and “controllers” of this organism have a social machine (the people themselves) supporting their policies ,especially if they also perceive a gain.

      The policies also represent a new mental construct for the South.

      Any mental construct affects people differently but always in the context of a person’s “ideological” group. Some will be convinced by it and accept it ,others will not.
      Today we are experiencing a situation were we have a mental construct in the North against the South that is twofold.

      1. It transfers responsibility from the North to the South.

      2. It presses for a change of the mental construct of the South with the blessings of number 1 above. That is to accept the “benign” policies of the new mental construct’s creators.

      A mental construct can only change if:

      1) another mental construct is being created that replaces the established one

      a. a construct with plausible “evidence” for the change. A good enough reason for the elite’s change of policy to be accepted.

      d. a truly proven better mental construct.

      2) An escalated action threatens the legitimacy of the established mental construct.

      3) A forceful and violent change is being tried ,also creating an environment of obedience as a part of the new mental construct.

      The threat the creator of a construct to preserve (of his/her own people) or of a construct to replace (of a target group’s) faces is ,of loss of control if:

      a. the mental construct overasserts itself ,so that a more extreme personality is being chosen to replace the representative of the construct.

      b. uncontrolled events escalate beyond the point of replacing the construct skillfully so the fallacy is revealed ,if the construct is indeed a fallacy.

      One would question ,why the elite doesn’t take the easy road and make these changes slowly and quietly to a large target group? Specifically the South? Other people?
      The answer is because the mental construct of a whole nation need to be forcefully changed ,also creating an environment of obedience.

      And here is where the creator’s threat of loss of control appears. And for the mental construct of the creator’s own social machine (his/her own people) and for the mental construct of the desired target group.

      When people know the above procedure ,they have more possibilities to escape it.

      It is in our best interest to avoid preserving our mental construct by choosing extreme representatives of it as is self-defeating and is in our best interest to be pro-active and endure the change until the powers that be can no longer sustain their efforts for change.

    • Demetri, in terms of a group of people on a desert island, please explain what you think Merkel is doing wrong and what you think she should be doing.

      You seem to have an issue with her point of view but I still do not understand why

    • Richard

      No defamation of a whole nation.
      No bailouts.
      No backing banks.
      Saying the truth for the illegal debt ,the scandals in Greece ,the partnerships with the Greek elite ,exposing the truth to Greeks and Germans ,admitting the european architecture problem and solving the thing in no time.

      She uses the German taxpayer money for her policies ,while she has convinced you that you pay for Greece. Through bailouts she covered the banks using also the taxpayer money of the southerns and through austerity she destroyed even the true potential of the real Greek economy and any economy for that matter.

      Reasons for not doing the right thing:

      She would have to expose the German part for the EZ manipulations not only in Greece but in all of EZ.
      She would not have the chance to use the crisis to pass policies for more German profit ,using also policies that are extremely needed.
      Now she doesn’t have the chance to change her narrative because her own people will bring her down.
      So she plays the tough cookie ,first for reasons of internal politics (not being able to change her narrative) when she talks against the so called lack of Greek reforming ,second because she wants to bring a lot more power to the center than what was originally designed for.


      If she had exposed all the manipulations we ,the Greeks ,would have her in our hearts as Otto Rehagel.

    • Demetri, I think the issue is you think Merkel told Papandreou to increase taxes and reduce pensions on the poorest people.

    • Richard

      The memorandum is online.
      Go read it and stop bothering me with your protective behaviour towards your Merkel.

      They are all in it together.

  • Merkel’s yellow button sounds like a direct route to “Deutschland Uber Alles.” Sure she’d choose it.

    • Exactly – Germany has got to pay and shut up…
      …otherwise they are clearly Nazis!

    • Martin

      Do not overgeneralize man.

      How about ,you pay what you owe us ,we pay what we owe you ,markets calm down a bit ,Greece leaves and you go play with the rest of Europe.

    • This plan suffers a bit from the facts that we don’t owe you and that Greece doesn’t pay back anything anyway, but the part about “Greece leaves” sure sounds good!

    • Gray

      Well Gray you owe us more than 500 billion ,we owe you a lot less and the average Greek person has already paid a lot to bailout the elite’s manipulations and “Germany’s” paneuropean criminal activities.

      And if we take into consideration the artificial increase of the Greek debt and the German scandals in Greece we owe you peanuts.

    • Zsikic, if I may add – with the additional threat, present-wrapped as a fact, that they are too big to fail.

      Possibly because the CEOs have no idea of the consequences themselves. Just ask Jamie Dimon.

    • @Demetri:

      “Tα ελληνικά ΜΜΕ ελέγχονται από την τρόικα [ΒΙΝΤΕΟ] ”

      That doesn’t surprise me at all! The EU, the ECB with the IMF have acted in such a deeply fascist way and with such a contempt for the Greek constitution and even basic European laws that it is just another proof of their disgusting deeply anti-democratic character.

  • Maybe we will know before all this is over what the Germans would vote for.
    And since this is a farcical comedy on many levels, the high point of which might be Americans voting for a rich ex-money-manager to lead them out of a crisis caused by his ilk and legitimized by voters.

  • Your are quite richt in your mental experiment.
    The reason why Merkel would be reluctant in pressing the red button, i think, is the same reason why the European Crisis in unsolvable: NATIONALISM, taking care of one’s one and being indifferent to others.
    The problem with Eurozone is that it’s not a state, like US or UK. There is no such thing as the European nation. Europe is a region and nothing more.
    This is why your Modest Proposal would not work, even thoug it’s a rational solution. For it to work it must have a sovereign nation behind it, and there is no sovereign European nation.
    So, this crisis is not solvable because the main institutions of Europe are not the Comission, EU Parliament or ECB. Europe’s institutions are Germany, France, Greece etc., and this states have diverging interest that cannot be reconciled by diplomacy.
    After all, the states coprising the Dollarzone also had diverging economic interests that were not solvable by diplomacy. The only solution to hold the Union together was the Civil War between 1861-1865.

    • No European press no European people, only a bunch of useless bureaucrats in Brussels!

    • Dear Dean
      Maybe we could even get through this without anybody being “annihilated”?
      That would be my preferred option.

      I think cristi is pointing to something vital: Up to recently, the EU was seen – more or less – as a “win-win” project everywhere.
      Germans could export better due to the EU, Greece would receive some transfers and could get loans for lower interest rates than otherwise etc.

      So, apart from the beauty of the project of a unified Europe as such (and the fact that together, we stand more of a chance to be heard in conflicts with e.g. the US and China), both sides saw the EU (and the Euro) as something that they benefitted from.

      This has – hopefully temporarily – turned into the opposite: Germans feel that due to Greek recklessness they are being drawn into the abyss. And Greece feels subjected to unreasonable hardship.

      Both see it as a kind of “loose-loose” situation.

      This is not a good basis for finding a way out.

      I think it would help to discuss what we may loose if
      a) the Eurozone collapses (advantages and disadvantages)
      b( the EU collapses (pro & con)

      I believe that if the governments had more balls (and a clue themselves) they would be able to point out to their electorate what they are doing / what needs to be done and why.

      Something like the “Modest Proposal” is probably the only way out. But how things have developed over the last two years does not make it more likely to happen.

      What’s been almost destroyed (on both sides, Greek and German alike) is the belief that the Eurozone (maybe EU as a whole) can work and is of mutual benefit.

      Germans are currently focusing on the negative sides (huge risk if bailout goes wrong which seems likely and continuation of permanent transfer payments such as structural and agricultural funds while this is not appreciated in e.g. Greece but instead still we are confronted with reparation payment requests and the like and obviously seen as very evil people).

      Greeks seem to focus on the pain of the current adjustment process and seeing this as something that the EU (and apparently primarily Germany) has decided to impose on them, for no apparent reason. They feel that the EU / Eurozone is some kind of trap and possibly a German conspiracy.

      With these kinds of attitudes on both sides, this cannot work.

      Hopefully, there will be politicians appearing on the scene very soon that will have the will and ability to explain their respective electorate what is going on and how we are all interlinked so we can do what is necessary (will be painful for both Greece and Germany) and in the end both benefit from it.

    • @Martin:

      “With these kinds of attitudes on both sides, this cannot work. Hopefully, there will be politicians appearing on the scene very soon that will have the will and ability to explain their respective electorate what is going on and how we are all interlinked so we can do what is necessary (will be painful for both Greece and Germany) and in the end both benefit from it.”


      I doubt that will happen my friend! I am very pessimistic and I guess it is more likely that the EU will disintegrate very soon! Maybe Greece, Italy, Ireland, Romania and some others leaving the Eurozone and/or the EU alltogether.

      We have passed a point of no return and I guess German ex-chancellor Kohl will be right in what he said about Merkel a few months “Die zerstört mir mein Europa”!

    • How can we have a civil war North against South?

      “A civil war is a war between organized groups within the same nation state or republic”

    • @ Dean Plassaras
      I’m not saying there will be a “Civil war” in Europe, or that the “North” will win against the “South” or viceversa.
      All i am saying is that it’s obvious by now that the reason we still have a crisis in the Eurozone is that the states involved do not wish to implement a solution because of their diverging national interests.
      How on Earth can we believe that, for example, the frech people(not the french polticians) will ever accept to give a german inspired Brussels bureaucrat veto power over their national budget?
      Taxing and spending is the essence of national sovereignty, the primary power of the State. Without that, a State is left with the power to proclaim National Ice Cream Day.
      You see, the primary institutions today are the nation-states, not EU, NATO, UN etc.

  • Maybe it’s neither a red nor a yellow button that will help us towards finding a solution.
    We could try with open debate about what the Troika wants and what the status on that is.

    In Portugal, there is apparently a group of students in economics that “monitor” their government’s achievements towards the reforms outlined in the MoU signed with the Troika.

    I found this article in the German “Spiegel” magazine by chance:

    The website (in English !) of those Portuguese students of economics is this:

    I find this very admirable and constructive.
    Maybe something like this exists in Greece, too?

    I think in the next few weeks it will be of vital importance for Greece to point out what it is aiming for, how it is going about it and where it stands in the process of implementation. Both – versus its citizens that just see the negative side (pensions and wages cut, etc) and also and towards the public abroad.

    That way, there could be much more sympathy towards Greece in e.g. the German public. I am sure Greece has already implemented much more than most people abroad are aware of. But that does not tend to make it into the news. All you hear in German news is that Greece is trying to debate about an extension, that it’s failed achieving what it signed, etc. That is exactly the kind of PR that you don’t need. A project like this would win you sympathies in the “donor” nations – and it may help to facilitate debate in Greece itself about what is being done, what has been achieved and where the process has run into difficulties, etc.

    • Greece is the donor nation. After 67 years of burning my house they didn’t pay for it. We don’t want sympathy from Germans, we want them out of Europe to create their own Europe as the N U D suggests. I support him. Please get out. I don’t know any time that Germans did us good. They only brought us misery and suffering. As a bonus take for free all those people you bribed.

    • Forget that. Nova university is where the neolibs congregate. I assure you that they are not “monitoring” anything, just patting the government in the back while they tax the poor to pay rentiers and fix the privatizations.

  • I think this example gives too much credit to the US and UK leaderships… Both are in thrall to conceptions of economics that prevent them from taking the relatively more radical measures that might have prevented or might yet prevent things getting worse. Why was the US stimulus no larger than it was? Can Cameron and Osborne pay attention to the recent IMF report that suggests that cutting deficits is not the answer for the UK?
    This is because the capitalist order is not in fact being run for the benefit of all, but to serve the interests of a small minority. And because of this, how can can you offer the Greeks an alternative when your message to the domestic working class is that “there is no alternative” to austerity?

    • Dear N EU D
      This would really be a possible outcome, unfortunately: Germany etc take risks, postpone but don’t avoid the collapse of the south and then get drawn into the disaster themselvers…
      Will be interesting to watch.
      Or maybe somehow this disaster will be stopped?

    • I also think that is a possibility. Maybe not a bad one. OK, some value will be destroyed. But at least after that it would be impossible for any party to convince the German public of another “joint currency” experiment.

      I prefer to lose 50%-100% of an annual salary once than paying constantly (until eternity) 10% to keep the ClubMed alive and kicking.

      The anti EU/EURO movement is growing day by day in Germany, Finland & Holland. There is no way that these transfers (implicit & explicit) can be maintained without a shift to radicalism in the north..

      People have started to drive around with “Euro Nein Danke” (Euro no thanks) stickers on their cars, designed like the stickers against nuclear energy!

    • “People have started to drive around with “Euro Nein Danke” (Euro no thanks) stickers on their cars, designed like the stickers against nuclear energy!”

      Peace man! What did you smoke today Pedro? Did you have any bath salts lately?

      You are scary man! Sounds like you are having psychodelic paraesthesia 🙂

      Can you show us some pictures of all the cars with the mentioned stickers?

    • There is nothing scary about it..They just look like the “anti nuclear energy” stickers.

      Just google for pictures “euro nein danke” and you can see how they look

    • I have seem them too. Really cool. The anto Euro movement will be the biggest civil society movement in Germany after the revolution in East Germany. Remember “If the DM does not come to us, we go to the DM”

    • “Why don’t you tell us all about your pain over Greek coffee?”


      Shame on you. The coffee is Persian.

    • That’s certainly very convincing, as long as you totally ignore the overwhelming evidence (our economy doing well, their’s broke) to the contrary.
      Seriously, if those people believe that evil Germany is ruining the Eurozone, why don’t they draw the only logical consequence and get out? Nobody forces the GIPSI’s to be a member.

    • The most incompetent thing the Germans are doing is not getting out of the Failure Zone themselves!

  • I think that you overestimate the differences between the US and European elite. What makes you think that the elite in the USA will not use the financial crisis towards the exact same goals, namely to cement the status quo since they are aware that the times of exponential growth are a thing of the past. Everything is ready for austerity in the US as well, haven’t you heard that the country is ready to fall off the “Fiscal Cliff”?

    • Tasos, I agree from the point of view that Yanis has severely oversimplified the US situation. Can’t agree re: US austerity though. Won’t be anything like Southern Europe.

      Paul Volcker quoted in today’s Australian Financial Review.

      “There is no magic bullet in fiscal or monetary policy. We have pretty much shot all the bullets we have,” Mr Volcker said……

      “On top of the economic problems we have a poisonous political situation,” Mr Volcker said.

      “I’ve been around for a quite while and I have never seen it as bad. They [legislators] try to create division rather than coherent policy, and it’s not clear there’ll be some magic dust after the election to create a better atmosphere.”


    • @jm
      It is bizarre to even utter it but the US and Greece have the exact same political problems in my point of view. Namely extreme polarization that cripples any significant attempt to build consensus on necessary reforms. US is on autopilot for the past year and a half and the economy relies solely on Bernanke’s actions. Mr Volker is absolutely right. Still I think the US elite will not miss the opportunity to pass the bill to the average US taxpayer and come out of this unscathed and with more power over the country.

    • Tasos, There is nothing wrong with lack of consensus between politicians. If only Greece had this situation in 2008, taxes could not have been increased.

  • – “I’m sorry Professor, but it’s turtles all the way down.”

    A story is told that Bertrand Russell, while teaching for a year in India, was once interrupted from a lecture on modern cosmology by an audience member who declared, “The universe rides on the back of a turtle.”

    To which Russell replied, “But what’s the turtle ride on?”

    “Another turtle,” replied the audience member.

    Insisted Russell, “But what’s that turtle ride on?”

    Came the answer, “I’m sorry Professor, but it’s turtles all the way down.”

    That story has often come to mind over the last eight years. In the early part of the last decade I had cause to mingle in financial circles, and by 2004 I had smelled skunk regarding a range of Wall Street activities such as are chronicled extensively on DeepCapture. I went with plenty of data, anecdotes, and experts, first to NASD, then to the SEC, then the House, then Senate Banking, and finally to the financial press. All of them reacted with something between indolence and hostility (and thus began seven years of one federal investigation after another, just as I had been warned). I began to use the expression “Turtles all the way down” to describe the Establishment and its capture by financial interests, and wondered if the turtles would run all the way down, forever, or if we would ever hit something solid.

    Today has brought good cheer in the form of an excellent piece by Gretchen Morgenson, “Into the Bailout Buzz Saw“, concerning Bailout, by Neil Barofsky. Ms. Morgenson, one of several journalists at the New York Times, describes assertions that will not be strange to long-term readers of DeepCapture:

    “We tag along with Mr. Barofsky, a former federal prosecutor, as he walks into a political buzz saw as the special inspector general for TARP. Government officials, he says, eagerly served Wall Street interests at the public’s expense, and regulators were captured by the very industry they were supposed to be regulating. He says he was warned about being too aggressive in his work, lest he jeopardize his future career…

    “‘The suspicions that the system is rigged in favor of the largest banks and their elites, so they play by their own set of rules to the disfavor of the taxpayers who funded their bailout, are true,’ Mr. Barofsky said in an interview last week. ‘It really happened. These suspicions are valid…’

    “THIS was just one of many examples from Mr. Barofsky’s 16-month tenure, during which, he says, Washington abandoned Main Street while rescuing Wall Street. ‘There has to be wide-scale acknowledgment that regulatory capture exists, dominates our system and needs to be eradicated,’ Mr. Barofsky said in the interview. ‘It was my job to bring as much transparency to taxpayers so they knew what was going on. Writing the book, I tried to bring the same level of transparency so people understand how captured their government has become to the financial interests.’”



    – Into the Bailout Buzz Saw

    IT might seem remarkable that there’s more to say about our late Bailout Age. But there is more — a lot more.

    Nearly four years after Washington began its huge rescues of banks with taxpayer dollars, an important player in this, one of the great financial dramas of all time, is offering a damning account of how the Bush and Obama administrations handled the whole episode.

    He is Neil Barofsky. Remember him — the man whose job it was to police the $700 billion Troubled Asset Relief Program? And his new account, a book titled “Bailout” (Free Press), to be published on Tuesday, is a must-read.

    His story is illuminating, if deeply depressing. We tag along with Mr. Barofsky, a former federal prosecutor, as he walks into a political buzz saw as the special inspector general for TARP. Government officials, he says, eagerly served Wall Street interests at the public’s expense, and regulators were captured by the very industry they were supposed to be regulating. He says he was warned about being too aggressive in his work, lest he jeopardize his future career.

    And so Mr. Barofsky, who formerly prosecuted Colombian drug lords as an assistant United States attorney in New York City, is schooled in the ways of Washington. One telling vignette comes early on in his book, when he is advised by inspectors general in other agencies about how to do his job.

    As Mr. Barofsky writes, he had assumed that his assignment to oversee TARP meant that he should be fiercely independent from the Treasury Department, and vigilant against waste, fraud and abuse. But after canvassing other inspector generals for guidance, he writes, he learned of different priorities: maintaining and possibly increasing budgets, appearing to be active — and not making enemies.

    “The common refrain went like this,” Mr. Barofsky writes. “There are three different types of I.G.’s. You can be a lap dog, a watchdog or a junkyard dog.” A lap dog is seen as too timid, he was told. But being a junkyard dog was also ill-advised.

    “What you want to be is a watchdog,” he continues. “The agency should perceive you as a constructive but independent partner, helping to make things better for the agency, so everyone is better off.” He also learned, he says, that success as an inspector general meant that investigations come second. Don’t second-guess the Treasury. Instead, “focus on process.”

    Thus the collision course was set between Mr. Barofsky and a crew of complacent, bank-friendly Treasury officials. He soon discovered that the department’s natural stance of marching in lock step with the banks meant that he had to question its policies and programs repeatedly to ensure that taxpayers weren’t at risk for fraud and abuse.

    “The suspicions that the system is rigged in favor of the largest banks and their elites, so they play by their own set of rules to the disfavor of the taxpayers who funded their bailout, are true,” Mr. Barofsky said in an interview last week. “It really happened. These suspicions are valid.”

    To be sure, Mr. Barofsky and his team were up against a powerful status quo. And that meant that they ran into plenty of brick walls.

    “Bailout” covers a lot of ground, running through attempts of the inspector general’s office to ensure that additional rescue programs suggested by the Treasury had safeguards in place to avoid conflicts of interest, collusion and fraud. One battle involved the Public-Private Investment Program, designed to get troubled mortgages off banks’ balance sheets by encouraging private investors to buy them using mostly taxpayer dollars. When the inspector general’s office recommended ways to protect against fraud and to fix other flaws in the program, Mr. Barofsky writes, the Treasury rejected the suggestions, maintaining that they would gut the programs and reduce participation.

    Another skirmish involved the department’s ill-conceived loan modification plan, known as the Home Affordable Modification Program. When the Treasury began discussing the program’s outlines, Mr. Barofsky said he became concerned that it would open the door to fraudulent foreclosure rescue schemes, in which large upfront fees could be extracted from desperate borrowers eager to participate in what was supposed to be a free government program. When his office recommended fraud-prevention measures, several were ignored, he writes.

    A few months after the modification plan was announced, his office began a preliminary audit of its rollout. “We soon verified what we had suspected,” Mr. Barofsky writes. “Treasury had failed to ensure that the servicers had the necessary infrastructure to support a massive mortgage modification program.” It barely got off the ground, and few homeowners have received the help they hoped for.

    THIS was just one of many examples from Mr. Barofsky’s 16-month tenure, during which, he says, Washington abandoned Main Street while rescuing Wall Street. “There has to be wide-scale acknowledgment that regulatory capture exists, dominates our system and needs to be eradicated,” Mr. Barofsky said in the interview. “It was my job to bring as much transparency to taxpayers so they knew what was going on. Writing the book, I tried to bring the same level of transparency so people understand how captured their government has become to the financial interests.”

    I asked Mr. Barofsky, now a senior fellow at the N.Y.U. School of Law, what could be done to get regulators to man up, as it were.

    “We need to re-educate our regulators that it’s O.K. to be adversarial, that it’s not going to hurt your career advancement to be more skeptical and more challenging,” he said. “It’s implicit in so much of the regulatory structure that if you don’t make too many waves there will be a job for you elsewhere. So we have to limit those job opportunities and develop a more professional path for regulators as a career. That way, they won’t always have that siren call of Wall Street.”

    Mr. Barofsky’s assessment of his former regulatory brethren is crucial for taxpayers to understand, because Congress’s financial reform act — the Dodd-Frank legislation — left so much of the heavy lifting to the weak-kneed.

    “So much of what’s wrong with Dodd-Frank is it trusts the regulators to be completely immune to the corrupting influences of the banks,” he said in the interview. “That’s so unrealistic. Congress has to take a meat cleaver to these banks and not trust regulators to do the job with a scalpel.”

    Finally, Mr. Barofsky joins the ranks of those who believe that another crisis is likely because of the failed response to this one. “Incentives are baked into the system to take advantage of it for short-term profit,” he said. “The incentives are to cheat, and cheating is profitable because there are no consequences.”

    Despite all of this, Mr. Barofsky ends on something of a positive note. Meaningful changes to our broken system may finally come about, he writes, if enough people get angry. His conclusion is this: “Only with this appropriate and justified rage can we sow the seeds for the types of reform that will one day break our system free from the corrupting grasp of the megabanks.”

    That’s not much of a silver lining. But I guess it’s better than none.


    • Fotis,
      Thank you so much for lifting the level of the conversation and giving food for thought. This debate on the blog between greek and german is tiresomely childish most of the time.

      Why can’t we all see that since money has no homeland, the main problem is the banks worldwide? It should be people against banks/money-debt making companies/all sorts of big buisnesses making profit on our backs (pharmaceuticals etc) and of course the politicians who serve them.

      Let’s not forget that almost all politicians (regardless of their nationality), belong to the elite. This means that although we elect them and pay for their (usually) extravagant way of life, they are bound to serve the interests of the elite! Their personal social and economic interests are completely conected with the elite! So their aquaintances (bankers, buisnessmen, academics etc) are what affects their personal views most.

      So if we consider that politicians are in between the conflicts of their electorate and their elite friends, it is easy to see why they are not as efficient in their job. If the american president and congressmen are more or less ruled by banks/buisnesses interests, then it is understandable that greek politicians are mere pets owned by the buisness interests in Greece. This is why no reforms are done or will ever be done in the right direction. This is why Mr. Venizelos when in office saved his friend Lavrediadis (Proton bank) using 860m euros from tax payer money. And it will happen again and again until greek sheep (the people that is), stop admiring stupidly all these “rich folks” and get a grip of reality.

      As our friend Mr. Barofsky said, time to get angry. Of course the level of corruption and social awareness differs from place to place but mostly, they are all getting rich with our money. Everywhere, even in Germany, France, UK, US.

    • kat

      “Thank you so much for lifting the level of the conversation and giving food for thought. This debate on the blog between greek and german is tiresomely childish most of the time.”

      Well ,kat
      it was better many months ago ,before certain personal attacks.

      It has become childish. Maybe some of us should stop responding to certain individuals and focus on the truth. The real truth.

      I am quite sure we all know what you are saying about banks and the elite.
      Although certain people use this knowledge just to distort and attack at the last moment.

      Your post is in the money.

  • My favorite sentence from Merkels office in the last 3 years came in today commenting pro/con a Grexit: “Nothing is more expensive than a debtor that can´t pay and is unwilling to cut cost”.

  • «Η Ντροπή της Ευρώπης»

    Στο χάος κοντά, γιατί δεν συμμορφώθηκε στις αγορές• κι Εσύ μακριά από τη Χώρα, που Σου χάρισε το λίκνο.
    Όσα Εσύ με την ψυχή ζήτησες και νόμισες πως βρήκες, τώρα θα καταλυθούν, και θα εκτιμηθούν σαν σκουριασμένα παλιοσίδερα.
    Σαν οφειλέτης διαπομπευμένος και γυμνός, υποφέρει μια Χώρα• κι Εσύ, αντί για το ευχαριστώ που της οφείλεις, προσφέρεις λόγια κενά.
    Καταδικασμένη σε φτώχεια η Χώρα αυτή, που ο πλούτος της κοσμεί Μουσεία: η λεία που Εσύ φυλάττεις.
    Αυτοί που με τη δύναμη των όπλων είχαν επιτεθεί στη Χώρα την ευλογημένη με νησιά, στον στρατιωτικό τους σάκο κουβαλούσαν τον Χέλντερλιν.
    Ελάχιστα αποδεκτή Χώρα, όμως οι πραξικοπηματίες της, κάποτε, από Εσένα, ως σύμμαχοι έγιναν αποδεκτοί.
    Χώρα χωρίς δικαιώματα, που η ισχυρογνώμονη εξουσία ολοένα και περισσότερο της σφίγγει το ζωνάρι.
    Σ’ Εσένα αντιστέκεται φορώντας μαύρα η Αντιγόνη, και σ’ όλη τη Χώρα πένθος ντύνεται ο λαός, που Εσένα φιλοξένησε.
    Όμως, έξω από τη Χώρα, του Κροίσου οι ακόλουθοι και οι όμοιοί του όλα όσα έχουν τη λάμψη του χρυσού στοιβάζουν στο δικό Σου θησαυροφυλάκιο.
    Πιες επιτέλους, πιες! κραυγάζουν οι εγκάθετοι των Επιτρόπων• όμως ο Σωκράτης, με οργή Σου επιστρέφει το κύπελλο γεμάτο ώς επάνω.
    Θα καταραστούν εν χορώ, ό,τι είναι δικό Σου οι θεοί, που τον Ολυμπό τους η δική Σου θέληση ζητάει ν’ απαλλοτριώσει.
    Στερημένη από πνεύμα, Εσύ θα φθαρείς χωρίς τη Χώρα, που το πνεύμα της, Εσένα, Ευρώπη, εδημιούργησε.

    Europas Schande

    Ein Gedicht von Günter Grass

    Dem Chaos nah, weil dem Markt nicht gerecht,
    bist fern Du dem Land, das die Wiege Dir lieh.
    Was mit der Seele gesucht, gefunden Dir galt,
    wird abgetan nun, unter Schrottwert taxiert.
    Als Schuldner nackt an den Pranger gestellt, leidet ein Land,
    dem Dank zu schulden Dir Redensart war.
    Zur Armut verurteiltes Land, dessen Reichtum
    gepflegt Museen schmückt: von Dir gehütete Beute.
    Die mit der Waffen Gewalt das inselgesegnete Land
    heimgesucht, trugen zur Uniform Hölderlin im Tornister.
    Kaum noch geduldetes Land, dessen Obristen von Dir
    einst als Bündnispartner geduldet wurden.
    Rechtloses Land, dem der Rechthaber Macht
    den Gürtel enger und enger schnallt.
    Dir trotzend trägt Antigone Schwarz und landesweit
    kleidet Trauer das Volk, dessen Gast Du gewesen.
    Außer Landes jedoch hat dem Krösus verwandtes Gefolge
    alles, was gülden glänzt gehortet in Deinen Tresoren.
    Sauf endlich, sauf! schreien der Kommissare Claqueure,
    doch zornig gibt Sokrates Dir den Becher randvoll zurück.
    Verfluchen im Chor, was eigen Dir ist, werden die Götter,
    deren Olymp zu enteignen Dein Wille verlangt.
    Geistlos verkümmern wirst Du ohne das Land,
    dessen Geist Dich, Europa, erdachte.

    • ΗΠΑ προς Ελλάδα και Τουρκία για τα κοιτάσματα: “Βρείτε τα”! – Έρχεται ο Φ.Γκόρντον
      27-07-2012 10:11:58


      Σε “ειδική αποστολή” έρχεται στην Ελλάδα και αμέσως μετά ταξιδεύει και στην Τουρκία ο γνωστός για την ανάληψη τέτοιου είδους αποστολών, Αμερικανός υφυπουργός Εξωτερικών για Ευρωπαϊκές και Ευρωασιατικές Υποθέσεις, Φίλιπ Γκόρντον.
      Η ξαφνική επίσκεψη του Φ.Γκόρντον, όπωε αναφέρον απόλυτα αξιόπιστες πηγές από την Ουάσιγκτον έχει να κάνει περισσότερο με την προώθηση της αμερικανικής πρότασης για από κοινού εκμετάλλευση των κοιτασμάτων υδρογονανθράκων τόσο στο Αιγαίο όσο και στις περιοχές ανατολικά-νοτιοανατολικά του Καστελόριζου στην Α.Μεσόγειο. Η επίσκεψη θα διαρκέσει μέχρι την Τρίτη 31 Ιουλίου.

      Στην Αθήνα, θα έχει συναντήσεις με τους υπουργούς Εξωτερικών, Άμυνας, Ανάπτυξης και πιθανόν να συναντηθεί ανεπίσημα και με τον πρωθυπουργό Α.Σαμαρά. Το μήνυμα που κομίζει είναι σαφές: “Βρείτε τα με την Τοτρκία στο θέμα των κοιτασμάτων για να κερδίσετε και οι δύο”.

      Στις 28/03/2012 ο υφιστάμενος του Φ.Γκόρντον, ειδικός απεσταλμένος του αμερικανικού ΥΠΕΞ για θέματα ενέργειας Ρίτσαρντ Μόρνινγκσταρ σε ομιλία του στην Αθήνα δήλωσε ευθέως ότι “από τις ανακαλύψεις αυτές θα πρέπει να κερδίσουν όλοι (σ.σ. και η Τουρκία, δηλαδή). Οι ΗΠΑ αναγνωρίζουν το δικαίωμα της Κυπριακής Δημοκρατίας να πραγματοποιεί έρευνα και παραγωγή υδρογονανθράκων, όμως από τους πόρους που θα προκύψουν ο Μόρνινγκσταρ πιστεύει ότι θα πρέπει να ωφεληθούν και οι Τουρκοκύπριοι” δικαιώνοντας τις θέσεις της Τουρκίας και των Τουρκοκυπρίων.

      Επεσήμανε δε ότι “Οι ανακαλύψεις ενεργειακών πόρων στην Αν. Μεσόγειο υπερβαίνουν τις άμεσα εμπλεκόμενες χώρες όπως την Κύπρο, το Ισραήλ και ενδεχομένως αργότερα και την Ελλάδα”. Ουσιαστικά ο Αμερικανός αξιωματούχος στέλνει το μήνυμα ότι αυτό που οι τρείς χώρες διαθέτουν είναι πολύ πολύτιμο και σημαντικό για την παγκόσμια οικονομία για να το διαχειριστούν μόνοι τους!

      Όπως δήλωσε υπάρχουν νομικά και πολιτικά ζητήματα που πρέπει να επιλυθούν αποδεχόμενος εμμέσως τις τουρκικές ενστάσεις όσον αφορά την περιοχή.

      Επεσήμανε ότι “θα είναι κρίμα οι χώρες της περιοχής να στερηθούν τα οφέλη των ανακαλύψεων”, στέλνοντας προειδοποιητικό μήνυμα προς όλες τις κατευθύνσεις για την πιθανή απώλεια αυτών των ενεργειακών πόρων λόγω προστριβών τονίζοντας όμως και την θέση των ΗΠΑ ως ισορροπιστή του γεωπολιτικού παιχνιδιού που εξελίσσεται στην περιοχή.

      Σε αυτή την φράση κρύβεται και η ουσία της επίσκεψης του προϊσταμένου του Φ.Γκόρντον

      Με την αποδοχή ότι η Τουρκία έχει συμφέροντα στην περιοχή οι ΗΠΑ αποστερούν από την ΕΕ την δυνατότητα αποκλειστικής εκμετάλλευσης των ενεργειακών πόρων της Αν. Μεσογείου μέσω της Ελλάδας. Ουσιαστικά οι Αμερικανοί τοποθετούν την Τουρκία ως χωροφύλακα στα σημαντικότερα ίσως ενεργειακά αποθέματα που βρίσκονται κάτω από τον έλεγχο ευρωπαϊκών κρατών, της Κύπρου και της Ελλάδας.

      Με τις δηλώσεις του αυτές επί ελληνικού εδάφους ο Μορνινγκστάρ επιβεβαιώνει όσα το defencenet είχε γράψει στις 26 Μαρτίου 2012 για τον εν λόγο αξιωματούχο και τις θέσεις τους όσον αφορά τα ελληνοτουρκικά.

      Όπως σημείωνε το άρθρο του defencenet, “ο R. Morningstar υποστηρίζει ανοιχτά την εξάλειψη κάθε ιστορικής διαφοράς μεταξύ Ελλάδας και Τουρκίας σε σχέση με τη Κύπρο, αλλά και στο Αιγαίο, και άλλα καίρια ζητήματα, με μια σειρά ελληνικών υποχωρήσεων που θα αναδιατάξουν τον χάρτη των δικαιωμάτων των δύο κρατών στο Αιγαίο και την Α.Μεσόγειο. Έτσι ώστε να καταστεί δυνατή η μεταξύ τους συνεργασία ώστε να υπάρξει μια κερδοφόρα (για τις ΗΠΑ…) συνεκμετάλλευση του ενεργειακού πλούτου του Αιγαίου, αλλά και της Α.Μεσογείου”.

      Στην επίσκεψή του στην Αθήνα ο Φ.Γκόρντον αναφέρουν οι πληροφορίες “θα συζητήσει ένα ευρύ φάσμα θεμάτων εξωτερικής πολιτικής με τους αρχηγούς των πολιτικών κομμάτων και μέλη του επιχειρηματικού κόσμου και δεξαμενών σκέψης”.

      Την Κυριακή θα μεταβεί στην Κωνσταντινούπολη, όπου θα συναντηθεί με ανώτερους κυβερνητικούς αξιωματούχους, ομολόγους των Ελλήνων υπουργών (ίσως δει τον Νταβούτογλου ανεπίσημα γιατί στην Τουρκίαοι “αυτοκρατορικές” αντιλήψεις τους δεν επιτρέπουν τέτοιου είδους παραβιάσεις του Πρωτοκόλλου, αφού δεν υπάρχει αντιστοιχία αξιωμάτων) για να μεταφέρει το κλίμα της Αθήνας στο θέμα της συνεκμετάλλευσης. Επίσης, θα πραγματοποιήσει επίσκεψη στη Θεολογική Σχολή της Χάλκης και θα παραστεί σε δείπνο του δήμου στην περιοχή Uskudar. Οι Αμερικανοί “παίζουν” πολύ με το Οικουμενικό Πατριαρχείο, καθώς το θεωρούν ως “ανάχωμα” στο Πατριαρχείο της Μόσχας.

      Η ουσία είναι ότι όσο περνά ο καιρός και πλησιάζειη ώρα έναρξης των εξορύξεων στην Α.Μεσόγειο και όσο η Ρωσία “δένει” την Ευρώπη με ενεργειακές συμφωνίες, τόσο θα αυξάνεται η πίεση προς Ελλάδας να εγκαταλείψει τις “χίμαιρες” για ΑΟΖ και να προχωρήσει σε συμφωνίες συνεκμετάλλευσης με την Τουρκία. Και όσο βαθαίνει η κρίση στην Ελλάδα, τόσο θα βρίσκει πρόσφορα ώτα στην ελληνική πολιτική σκηνή.

    • @Demetri:

      ” The EU leaders are still laughing………”

      There is a saying: He who laughs last laughs longest 🙂

      This may not be the Germans and the EU officials at the end!

  • Although Greek i m uncomfortable how you criticize Klaus. Because Klaus all points have a practical approach (even if disagree) and take as axiom that Greece never to be forced to leave euro, because identifies to Greece great potential if reforms implement properly.
    You have to admit also which of the vital reforms (I would remind you Lisbon Agenda which propose almost the same to happen in Greece) implemented at least partially?
    We change, economic model mentality (we import 7 to 10 products) bad businesship governance, public sector functioning to catch tax evasion, fulfill the implementation of good practices in public to give pensions in 3 months?
    How all professions are promoting a kind of limited competence to preserve only for some?
    Don’t tell those govern us for many years are to blame only because even a few implementable ideas never proposed specifically from almost every political party.
    Europeans, IMF are to blame for some, lately for not recap banks and admit our losses.
    This issue should be in disunion with our obligations. We should ask not even for an extend but to fix banking good financing. This is essential.
    As worked outside Greece you can assess honestly many of our mistakes as political system society and people individually.
    Does Germany policy is getting us to a wall? For you, yes evaluating what is happening in other countries althought different cases.
    But even if from tomorrow let say we have no debt, in 10y we would have a growing debt and imbalances to our accounts with the same way of acting?

    Νομίζω, πως ναι.

    • MS your close but you are still falling into the propaganda that your government puts out and that is it is the fault of the Greek citizens. It is not.

      “We change, economic model mentality (we import 7 to 10 products) bad businesship governance, public sector functioning to catch tax evasion”

      Any business that is working in Greece now is a miracle. They are geniuses.

      Tax evasion has nothing to do with Greece’s problem. IF tax evasion exists in Greece then it needs to, even if you believe the Greek government saying tax evasion is a major problem, Greeks still pay more tax than the British, even when you take into consideration the tax evasion. In other words, Greeks are paying much more than what is fair.

    • MS

      “But even if from tomorrow let say we have no debt, in 10y we would have a growing debt and imbalances to our accounts with the same way of acting?”

      No ,because the reason for all these problems is extreme manipulation.
      We need the reforms anyway but do not let them confuse you that this was the problem. It has nothing to do with Greece.

      As an example the deficit increased a lot only after 2007 ,when every euro loaned to Greece had suddenly ROI of 12236%.
      This is what we pay (amongst other things). Fraudulent loans for illegal profits. A good opportunity to pass policies as well.

      After 2011 we have a primary surplus ,no matter the lies they say.

      Thsi is a war.

      The people at the top must vanish. And the average Greek must understand the games played ,because his/her ignorance is his/her biggest mistake.

    • The Greek government will not have a primary surplus in 2012. If you take interest payments out MAYBE but I doubt it.

    • Richard

      Yes i guess you are right.
      The essence of my post does not change though.

  • Proof that everything was planned:

    When Papoulias became president ,Mpenaki told him: “You are becoming president in a time when Europe will try to achieve full integration ,our sovereignty will be decreased ,our national borders will be decreased for the sake of peace ,the rights of people will change as they will be protected and violated by new forms of governance , etc. etc.

  • Once again you present a “mental experiment” here that is deeply flawed on several aspects, most importantly in that the alternatives are totally unrealistic (no costs financially, politically involved for saving the European economy? No mention of how the wealth will be distributed? What about long term consequences?). And the outcomes you present are exclusively based on your own subjective view of the political leaders There’s nothing scientifical in this. You misleadingly name that a “mental experiment”, I rather call that a disturbing example of narrow-mindedness, which only shows how much the results depend on prejudices and the limited knowledge of the participants.

    • It is very tiring to read your uneducated propaganda across all the Greek media, including the Athens News, Kathimerini and several other blogs. There is a saying, “empty vessels make the most noise”. You seem determined to prove that.

    • @Guest:

      “It is very tiring to read your uneducated propaganda across all the Greek media, including the Athens News, Kathimerini and several other blogs. ”


      Is this guy really blogging all over the Greek media???
      I am not following other blogs so didn’t come across this guy!

    • @Aristoteles

      Yes, but only the English language ones. He usually appears as Gray (the moniker that he also used to use here, but changed recently for some reason). Even with a completely different name, I would recognise his style of presentation and English: always the same hectoring semi-educated line about what is wrong with Greece.

    • @Xenos: Pot calling the kettle black!
      As if you don’t comment at all those sites, too. Ridiculous.

      Btw, I EXCLUSIVELY comment as “Gray” in all English language blogs and media sites, all around the world. Sometimes I ADD the additional info “Germany” in order to avoid confusions, or I have to add a number or name when at a discussion board “Gray” is already in use by somebody else (like at Twitter, where I participate as “graygoods”). Can you honestly claim that you only use the pseudonym “Xenos” and not engage in any sockpuppetry? Hmm?

    • @Gray

      I have met people like you, who think that everyone is as corrupt and dishonest as themselves. It must be strange for you to encounter people who are honest and behave well. So, the answer is that I post only under this nick or my real name. I stopped using my real name after my university and I received threats from anonymous persons. And I post on only two blogs.

  • Accoding to a Turkish minister: In the past when we have asked Turks if they wanted to live in the EU 85% said yes. Now 80% say no.

    The EU and the Euro are such a success story!

    • Are you trying telling us that the Turks say no to something that is not even available (nor will it ever be) to them?

      How smart!

      It’s just like you saying that you say no to Harvard because you will never be admitted there. How profound.

      Anything else from the Turkish minister?_Did he also say that he found Merkel sexy? What else did he say?

      Now I am curious.

    • @Dean,

      My take is that Pedro is one of our Καρντάσια from the east!

      Is that right Pedro? Are you a turkish kartaslar?

  • Playing with Fire in the Eurozone


    The truth of the matter is your fucking government attacks Greece because they are too immature to admit their mistakes and you are all imbeciles. We have explained everything and we have done a lot already.

    There is nothing more to be said.

    • Demetri, Yiannis. I mean this is the most respectful way possible.

      You are both utterly clueless about the feelings of the Germans.

      I have said it before and I will say it again. The German people have compassion for the Greek people.

      Germans can see what the Greek government is doing to the Greek people and they feel sorry for Greeks. I think the comments from Germans on this blog back this up completely.

      I can not put it any clearer than that.

      This feeling of anti-Germany is a propaganda campaign perpetuated by the entire Greek , trade union dominated, media in order to maintain the status quo. They know if the Greek government does the right thing they will be smashed.

      The unions have nothing to lose which is why there is nothing intelligent coming from the Greek media about the Greek crisis. And it is why the media is poisoning the minds of Greeks against Germany.

      If either of you can highlight an article where Germany attacks the Greek people I am all ears.

    • Don’t try to fool us my friend!!!

      Your nonfactitiousness is unbearable and insults our cognition!!!

      Betrüger in der Euro-Familie – CHEATERS IN THE EUROFAMILY:


      More racism from the German FOCKUS magazine here:


      About the anti-Greek hate campaign of the Bildzeitung:

      and more here:

      More about the Bildzeitung here:

      Die Hetze der Bild-Zeitung gegen „die Griechen“

      Seit Monaten hetzt die Bild-Zeitung gegen Griechen und Griechenland. In verschiedenen Variationen immer dieselbe Botschaft: „Die Griechen machen unseren Euro kaputt!“ Was „die“ falsch machen, erkennt man daran, was „wir“ richtig machen:

      „Hier arbeiten die Menschen bis sie 67 Jahre alt sind … Deutschland hat zwar auch hohe Schulden – aber die können wir auch begleichen. Weil wir morgens ziemlich früh aufstehen und den ganzen Tag arbeiten. Weil wir von unserem Gehalt immer auch einen Teil für schlechte Zeiten sparen. Weil wir fitte Firmen haben, deren Produkte rund um den Globus gefragt sind.“ (10.3.10)

      Die Deutschen leben also, um tagein tagaus von früh bis spät zu arbeiten, bis sie alt sind. Das tun sie für ihren Staat, damit sich der neue Schulden leisten kann. Deutsche sind fleißig und zu Opfern bereit. Warum also ist der Euro „unser Euro“? Nicht weil wir ihn haben, sondern weil wir ihn möglichst wenig beanspruchen. Wir sagen zwar „unser Euro“, aber das „unser“ besteht darin, dass wir uns ihm, d. h. seiner Vermehrung unterwerfen und ihr nicht im Wege stehen. Damit sorgen wir auch dafür, dass wir fitte Firmen haben. Für die arbeiten wir tagein tagaus von früh bis spät, schonen ihren Personalkostenetat, und wenn sie uns nicht mehr brauchen können, murren wir, mehr aber auch nicht – sonst wären sie ja nicht fit.

      Dass wir so sind, haben auch die im Ausland gemerkt, bloß finden die das nicht so toll wie wir. „Man rümpft in Frankreich schon länger die Nase über die Lohnzurückhaltung der deutschen Gewerkschaften und die dadurch entstandene Senkung der Lohnstückkosten in Deutschland, zumal sie den französischen Export empfindlich stören.“ (FAZ, 16.3.10) Und die französische Finanzministerin Lagarde beschwert sich: „Deutschland hat seine Lohnstückkosten und seine Arbeitskosten insgesamt seit gut zehn Jahren im Vergleich zu seinen Partnern gesenkt und sich dadurch auf den Exportmärkten Wettbewerbsvorteile verschafft.“ (SZ, 15.3.10)

      Aus berufenem Munde erfährt die deutsche Arbeiterklasse also, was mit ihr angestellt wird bzw. was sie mit sich anstellen lässt. Hier spricht eine französische Politikerin über die Konkurrenz der Staaten: Deutschland verschafft sich Wettbewerbsvorteile auf den Exportmärkten, und das passt der Ministerin nicht, denn das ist zum Nachteil Frankreichs – und ein bedeutendes Mittel in dieser Konkurrenz, wenn nicht das wichtigste, ist die Kostengünstigkeit und Dienstbarkeit des für diese Konkurrenz zu benutzenden Volkes. Sie sagt: „Deutschland hat seine Lohnstückkosten und seine Arbeitskosten insgesamt gesenkt“, nimmt also die Leistungen der Unternehmer beim Lohndrücken unmittelbar als Erfolg der Nation und auch die deutschen Gewerkschaften haben sich mit ihrer „Lohnzurückhaltung“ in den Dienst der Nation gestellt.

      Diese Äußerungen der Ministerin haben hierzulande für eine gewisse Empörung gesorgt. Nicht deswegen, weil man den Wahrheitsgehalt ihrer Behauptungen bestreiten würde, sondern weil man das als Angriff auf die von Deutschland eroberte Konkurrenzposition und das dafür eingesetzte Mittel verstanden hat. Und dieses Mittel und dessen Einsatz in gewohnter Manier lassen wir uns nicht madig machen, geschweige denn wegnehmen. Exporterfolge auf Kosten anderer Nationen durch Verarmung und Ausbeutung zu erzielen – das soll unfair sein? Dagegen muss sich die deutsche Politik entschieden verwahren:

      „Herr Schäuble … wies die Kritik seiner europäischen Gegenspieler, einschließlich … der französischen Finanzministerin zurück, dass Deutschlands Exportmodell irgendwie für die Not der schwächeren Länder verantwortlich sei. ‚Ich möchte sehr klar, ruhig und besonnen die Kritik in Abrede stellen, dass die, die ziemlich erfolgreich im Wettbewerb sind, für die Probleme anderer verantwortlich zu machen sind.‘“ (Financial Times, 17.3.10)

      Der deutsche Finanzminister steht ausdrücklich zum deutschen Erfolgsmittel im „Wettbewerb“ um nationale Aneignung von Reichtum. Er stellt klar: Wer bei der Volksverarmung schwächelt, trägt selbst die Verantwortung für ausbleibenden wirtschaftlichen Erfolg! Und Kanzlerin Angela Merkel pflichtet ihm bei:

      „‚Dort, wo wir stark sind, werden wir unsere Stärken nicht aufgeben‘, sagte sie im Bundestag … Es ist falsch, sich nach demjenigen zu richten, der am langsamsten ist.“ (Spiegel Online, 22.3.10)

      Wenn ein Politiker zum anderen sagt: „Du hast es eben nicht geschafft, dein Volk so herzunehmen wie ich“, dann redet er nicht über die Faulheit anderer Völker und er beschwert sich nicht ausgerechnet über die. Es ist zwar jetzt große Mode, dem griechischen Staat Versagen in Form zu großer Rücksichtnahme auf sein Volk vorzuwerfen, aber sollen sich deutsche Politiker wirklich gewünscht haben, dass Griechenland sich toll aufbaut und Deutschland Konkurrenzniederlagen zufügt? In Wahrheit ist es doch so, dass Griechenland in der innereuropäischen Konkurrenz immer weiter zurückgefallen ist, was darum und nur darum ein Problem ist, weil das griechische Geld eben auch der Euro ist. Wenn nun die Finanzmärkte griechische Staatspapiere immer mehr in Zweifel ziehen, dann ist das eine Krise des Euro – Deutschland sähe es zu gern, wenn man diese Krise lokalisieren, also ganz auf Griechenland begrenzen könnte, aber bei einer Gemeinschaftswährung ist das kaum möglich, wenn überhaupt. Das sind die Sorgen deutscher Politiker: Die Überlegenheit Deutschlands in der Konkurrenz wird den Finanzmärkten sicherlich gefallen, wenn sie aber die konkurrenzlerische Unterlegenheit Griechenlands – dann Portugals, Spaniens etc. – zum Gegenstand ihrer Spekulation machen, dann kratzt das eben auch die Gemeinschaftswährung an und Deutschland wird in Mitleidenschaft gezogen. Mit dieser Lage gehen die deutschen Politiker so um, dass sie einerseits ein „Rettungspaket schnüren“, das den Staatsbankrott Griechenlands und seine Wirkungen auf den Euro verhindern soll. Dieses Rettungspaket wird andererseits an die Bedingung geknüpft, dass der griechische Staat, der seinen Bürgern bisher unverantwortlicherweise erlaubt hat, „über ihre Verhältnisse zu leben“, endlich „seine Hausaufgaben macht“, nämlich durch ein rigoroses Sparprogramm die Solidität seiner Schulden wiederherstellt.

      Das ist das Stichwort für die Bild-Zeitung. Sie verdolmetscht ihren deutschen Lesern das Konkurrenzverhältnis zwischen den europäischen Staaten und dessen Wirkungen auf den gemeinsamen Euro nun so, dass sie Völker gegeneinander antreten lässt – sie tut so, als wären die die Macher in dieser Konkurrenz. Sie tut so, als hätten es die Völker in der Hand, was aus „unserem Euro“ wird, und da fällt Bild bezeichnenderweise als das Mittel, den Euro zu stärken, genau das ein, was die Politiker sich zuvor gegenseitig als „Senkung der Lohnstückkosten“ und „Lohnzurückhaltung“ vor die Nase gehalten haben – nun aber als die Tugend des Verzichts und der Leistungsbereitschaft. So wird die Bild-Leserschaft dazu angestachelt, ihre Dienste für das Kapitalwachstum im Land und die erzwungenen Einteilungskünste, die damit einhergehen, als freiwillig erbrachte Leistung hochzuhalten und Stolz auf ihre Tugendhaftigkeit als Arbeitsleute zu empfinden, von der angeblich alles abhängt. Sie haben als mustergültige Deutsche das Ihre dazu getan, Deutschland voranzubringen. Unter dieser Bedingung erkennt ihnen die deutsche Presse das Recht zu, das Griechenvolk als minderwertig zu verachten. – Na, großartig!

    • Aris, I couldn’t translate the first 2, the second 2 attach the Greek government, the last one, Im not sure the translation did not make much sense.

      I think you need to start opening yourself to the possibility that the Greek media is lying to Greeks about Germay

    • Richard

      “I think the comments from Germans on this blog back this up completely.”
      “If either of you can highlight an article where Germany attacks the Greek people I am all ears.”


    • Klaus

      My dear Klaus ,i have repeateadly distinquished the German public from the manipulative political games that are played in every country.

      These feelings from both Germans and Greeks are wrong.

      I will once again state that in this blog i attack certain individuals who do whatever they can to exonerate the German government ,that itself acts anti-German. As ort government acts anti-Greek.Truth be told ,it gets out of control some times.

      In your blog you posted opinions of Germans that are clearly wrong ,as such opinions of Greeks are too. The Greek population rejected the bailouts ,but the German media defamated the population and not the state.

      Everybody takes it to the extremes thanks to propaganda and on top of it all there are those that post specifically to preserve these extremes.
      Germans and Greeks are being played and should understand once and for all that there never was something Greece or Germany did.

      Only actions ,that were hidden behind countries and orchestrated by certain individuals using these characteristics.

      Germany was to be “the hegemonic power” that will be used for attacks decades before the euro. Germans should do well to understand that ,because the games played dangerously create a “divide and conquer” situation for the interests of the few.

    • Not since there also exists illegal debt.

      No ,not even half a bailout was needed.

    • @Pedro

      “So at the end of the day it saved the Greek tax payer EUR 30.000 per head.”

      No that is a wrong conclusion. Those 30000 euros per greek head kicked the can two years forward ( default) . It is till looming. If there had been no bailouts we would have defaulted two years ago , and the greek citizens would not now owe 30000, they would just be trying to survive with the drachma.

      The reason the 30000 per head was given to Greece was in order for the EU to buy time and get rid of toxic greek bonds, or isolate them in the central bank. They were mortally afraid in 2010 that the whole eurozone would tank if Greece defaulted then.That is why they are now talking of grexit, they feel comparatively safe. So they bought time and safety with their 30,000 per head. Expensive, but nothing to do with the greeks, if a grexit comes down the pike.

    • First EUR 30.000 per capita went to Greece and was not invested well. Sencond, since it was not invested well Greece could not pay back. Third anothe EUR 30.000 per capita went to Greece for a day and straight back to mostly French banks.

    • Pedro

      Unfortunately they also shut down agencies that protect the interests of Greece.

      For one last time.
      The reforms are extremely needed.
      But unfortunately they are only a cover up for specific reforms that are against Greece.

      Anyway ,
      i really hope the transfers of employees are efficient because a bigger problem even from the existence of worthless agencies ,was the placement of these individuals.

      Usually the individuals have the skills. But they are no good when they put you at the wrong post. Or when they put more people where you need less and few people where you need more.

      If they honestly fix this ,that would truly be something good.

  • One should listen to old men. They have more exprience and thus are less error probe than young hot shots:

    Prof. Hanekl (83): “I have studied the breakup of 70 currency unions. right now I am experiencing #71”.

    “Hitler was the product of a social crisis. In the South we are seeing a currency crisis turning into a social crisis”

  • It all comes down to the trade deficit. Without the trade deficit, there would be no substantial foreign debt. This problem can be solved through forcing balanced trade, and this can be done through the through the gradual introduction of import certificates. Greece can do this unilaterally.


    Import certificates are issued to allow the import of a certain amount of value of goods for each value of goods exported: The goal is balanced trade, when one euro of certificate would be issued permitting the import of goods for each euro of goods exported. That is the country of destination of Greek exports would be allowed to export back to Greece one euro of goods, for each euro of Greek goods it imports. The trade deficit of itself has done damage to the Greek economy, and must be reversed. Greece must become, for a while at least, a net exporter. See:http://anamecon.blogspot.com/2010/04/effects-of-unbalanced-trade.html

    • Greg – “It all comes down to the trade deficit. Without the trade deficit, there would be no substantial foreign debt” – you are correct up until this point. With regards to restricting imports and exports, I refer you to Albania and Hoxha, to see how your policy worked out.

      The correct way to address the trade deficit is simply to make Greece as competitive as Germany and this is simple to do. The government simply has to cut back massively and get out of the economy. The correct solution is also the cheapest.

    • @Richard:

      ” The correct way to address the trade deficit is simply to make Greece as competitive as Germany and this is simple to do. The government simply has to cut back massively and get out of the economy. The correct solution is also the cheapest.”

      With all respect but what you right is economic nonsense!

      In boxing you have different weight classes right?

      Would you put Mike Tyson into a fight with a featherweight boxer?

      Certainly not!

      Its the same with the Eurozone and the EU! Its simply an unfair competition between different nations and their economies! You have some heavyweight economies and some featherweight economies and they fight all in the same weight class so to speak!

      The right answer is either re-transfer money from the stronger to the weaker members of this “Union” or it is simply time to call it a day and send the whole European Dis-Union to Hell!

    • Pardon my French, but this is a silly comment. Do you think all states in the USofA have the same competitive position? The difference is that Americans accept that and you don’t seem to accept that for Greece. Any difference in a competitive position and productivity in a currency union is neutralized by the living standard. If people in Alabama are not happy with their living standard, they move elsewhere. If they prefer to live in Alabama, they accept that state’s living standard and don’t complain that the Floridians have a better living standard. Period!

    • Aris, on a per capita basis, do you believe on average that a German is better educated, has access to better technology and/or has access to more natural resources than a Greek?

      (Forget about the government and taxes and regulation for a moment)

    • @Greg:

      ” This problem can be solved through forcing balanced trade, and this can be done through the through the gradual introduction of import certificates. Greece can do this unilaterally”


      Unfortunately this isn’t allowed in the European Dis-Union. The EU is all about free trade and free capital flows!

      When Greece and the other Southern countries joint the German inspired Euro-Club they gave up their last ressort against mercantilism!!!

      For me the Greek politicians who forged Greece into the Eurozone have to be brought to justice for their gross misconduct!

    • Richard: you are clueless. There are complex structural reasons why some countries (and some sectors) are more competitive than others. These structural differences cannot be changed quickly, and usually require substantial investment of capital and massive changes in socio-political organisation and culture.

      You have swallowed wholesale the propaganda of the Troika. There is no way that any decent economist in the IMF can think that there is any chance of effecting substantial short-term reforms in the Greek economy that would significantly impact competitiveness. The Troika policy is a mix of fiscal austerity (to extract rents due to banks) and token economic reforms (to pretend that they are really doing something). There is no strategy and no panacea.

    • I agree, there are massive structural problems that only a default can solve.

      I agree the Troika have made mistakes, they should never have got involved and nor should Germany

    • Klaus ,Aristoteles

      Klaus is right and you Aristoteles are partly right.
      We can not become as competitive as Germany ,especially now.
      We were better before euro. But it is not the euro itself the problem. The euro has advantages. It is the way it was used for all kinds of manipulation.

      These EZ policies destroyed more potential.
      And now ,during the crisis ,the reforms were misused ,delayed etc. etc.

      The problem became one of competitiveness because of other reasons as planed deindustrialization ,destruction of agricultural production and of other sectors ,increase of not needed imports in the EZ etc. etc.

      And whether certain Germans here like it or not ,Germany (official) had a leading role at everything ,no matter what she says now.

      For me the demise of Greece was planned.

    • The demise of Greece was planned.

      The Greek crisis was engineered to give the ECB more power and to kill Germany’s influence in Europe.

      Everything is going according to plan.

    • @Richard: That’s like saying Greece should disrobe and get raped. Germany is competitive because of its government involvement in its economic policy. Indeed, the entire debt fiasco is a result of German industrial policy. See this nice talk by Dr. Heiner Flassback, where he spells out how Germany did it:

      Many things can be negotiated. The EU is already doing things it didn’t do before, just with the bailouts. The point is, if Greece is to ever pay back its debt, if it is ever to stop going further into debt, without selling itself off, it will eventually have to export more than it imports, and phasing in import certificates is a way of bringing this about. Otherwise there is simply no mechanism that will bring this about. Forced austerity will not work, since it damages exporters as much as the rest of the economy. But this is something that is up to Greece to do, and put a timetable and limit on the process.

      If the EU, Germany, does not agree to some mechanism, they must be regarded as an enemy. Even selling Greece off to German interests, which is the final result of austerity, will not work, because what remains of Greece will still be in debt.

    • @Greg:

      KUDOS for the video with Dr. Heiner Flassbeck!!!

      He is one of the few honest German economists who dares talking about the real causes of this crisis!

      Class War: Low Wages and Beggar Thy Neighbor

      Germany is competitive because of its government involvement in its economic policy. Indeed, the entire debt fiasco is a result of German industrial policy!


    • Greg, aristoteles, so you acknowledge that the government can have a policy which leads to a country having an advantage over other. Going by the video. My question, if the advantage of Germany policy was so obvious why didn’t other countries copy it?

    • “Greg, aristoteles, so you acknowledge that the government can have a policy which leads to a country having an advantage over other. Going by the video. My question, if the advantage of Germany policy was so obvious why didn’t other countries copy it?”

      Your question is a bit shallow Richard. “Beggar Thy Neighbor” and “mercantilism” is considered hostile economic policy and can lead to trade wars!!!


    • Aris – Food for thought. Im not sure how relevant it is though considering there are no trade barriers between Greece and Germany. With regards to government subsidies of domestic industries, from what I have seen, I would say Greece is more guilty of that than Germany (peripteros, ktel, taxis, trucking, bakeries, port workers etc etc etc) the difference being the way it is used in Greece is much more inefficient than in Germany.

    • Klaus, afaik mobility is actually decreasing in the US. Many people are stuck with houses they can’t sell in the weak real estate market.
      And then, is such high mobility actually desirable? What are the consequences for the people? Especially for children, it may be in many cases a negative experience. And what if I change this statement a bit: “If people in Libya (or any other african nation) are not happy with their living standard, they move elsewhere.” We all know this has become an increasingly urgent problem for the EU, especially Greece and Italy! As I see it, to generally state “mobillity is great and the best solution to different standards of living” is disturbingly simplistic.

    • This is one of the reasons why one should not compare the US with a possible future structure for the EU. Americans are unbelievably mobile. After all, they stay in “America” even if they move from Maine to Southern California. Such mobility is not a proposition for the EU because, if one is honest, we have Greeks, Italians, Austrians etc. but not really “Europeans”. “Home turf” is not necessarily something which Americans associate with one state. Their states don’t have the cultural heritage and the different languages which European countries have.

    • “Germany is competitive because of its government involvement in its economic policy.”

      Hahaha, so I conclude communism leads to the most competitive environment. And France with one of the highest shares of government share in GDP is highly competitive…

    • greg

      Thank you for this video.
      I like this man. Is he allowed to say these things in “Germany” or they will stone him?

  • Btw, since you so obviously doubt that the Germans really want to help the Greeks, why don’t you consequentially focus on solutions that exclude us (and the other European nations, like Finland and Slovakia, that are sick and tired of subsidizing the Greek mess)? We never promised anywhere, anywhen, that we will the welfare agency of the Eurozone, so you have neither logical nor ethical grounds for blaming us for our refusal to take up that role now. I remember you recently wrote about a bond union of the GIPSI nations and others who’re willing to join. Sounds like a great idea to me. It will be a horrible failure (why should investors have any confidence in a flottila of sinking boats?), but at least we won’t have to pay for that and you can’t reasonably blame us for the desaster (even though I’m sure some Germany haters will still do so). Really, be missing! You folks don’t like our plans, alright, follow your own ones and stop blaming everybody else for the consequences. Enough already.

    • Dear Dean
      Once Germany is destroyed, everything’s gonna be just fine!

    • Dean, didn’t you just say above that this was a serious blog, not a place for trash. Or don’t you consider saying “anything that shakes down and destroys Germany is a very good thing indeed” as trash. If not trash, what is it then? Civilized discourse, perhaps? I leave it up to others to judge.

    • Yes, I agree Klaus. We can do without the nationalistic and jingoistic nonsense. There are enough problems already.

  • Geithner on Financial Crimes: The Dog Ate My Homework

    If I rob a federally insured bank and make off with $20,000, I’m facing years of federal prison time. If I defraud federal insurance programs, be they FHA or Medicaid, I’m also facing years of prison. If I engage in insider trading, I could also be looking at prison time (although that’s pretty rare).

    But if I rig the most widely used interest rate index in the world, a leading bank regulator doesn’t think that the Department of Justice needs to be notified because they’re not part of the regulatory working group focused on LIBOR. That was Timothy Geithner’s explanation today as to why he didn’t notify the DOJ when he learned of Barclay’s LIBOR fraud. For real? What’s next? The dog ate my homework?

    It all leaves me scratching my head. The harm from the LIBOR rigging is massively greater than any of the other financial crimes for which we send people to prison. Why wouldn’t the then head of the NY Federal Reserve Bank think that this was potentially a criminal matter? The “not part of the working group” is just about the lamest excuse I can think of. I don’t normally talk to the police, but I call them if I think there’s a crime in progress.

    So perhaps Geithner simply didn’t think the wrongdoing was criminal or even potentially criminal. How is that possible? My hypothesis is that it simply isn’t comprehensible to Geithner that senior executives in financial institutions could be engaged in criminal behavior. Criminals don’t wear suits. They use six-guns, not fountain pens. Perhaps many bank regulators are simply too cozy with bankers to see them as even potentially criminal. They might have gone to college together. They interact regularly and their careers are intertwined. They may be part of the same social milieu and may even socialize. Institutions might get fined (without admitting any wrongdoing), but criminal penalties? Not for these kind of people.

    I’m not sure how one can possibly test this hypothesis, but I’ve started asking my students about it. Some of them, I figure will one day be prosecutors and regulators, and need to be prepared to deal with this situation. I ask them if they would have any reservations about sending the person sitting next to them to prison for 20 years or if they could lock up a college acquaintance. When I ask, I’m not really looking for a specific answer, although the conversation can be interesting. Instead, the questions are meant to drive home the point that it’s a lot easier to prosecute someone with whom you have no connection than someone close to you. Regulatory capture seems to shape the way we regulate financial institutions in an endless number of subtle ways.

    As an aside, I wish the NY Times coverage of the hearing were a little more probing. The fact that Dems rushed to Geithner’s defense, while the GOP attacked him is sort of like reporting “dog bites man.” It’s election season already in DC, and that means it is not possible to have a real conversation about any policy issue until 2013. Every hearing now is political theater, more so than usual. Speaking of which, did anyone notice the incessant string of mid-summer Dodd-Frank hearings? It’s amazing to see how regulations most of which are not yet in place are responsible for choking credit to the economy for years and for the travails of community banks which have been dropping like flies for decades. Logic disappears in bad cases of electoral fever.


  • Yani,

    you are more than right but I’m afraid that most people are not aware of their own prejudices.

    Therefore THEY are going to make Greece a warning example by destroying it. “That will happen to you if you don’t swallow the medicine we give you: you will die like Greece.”

    But THEY are international. THEY rule the world. THEY are THE 1%.THEY own the media. THEY use cheap prejudices and most people agree without reflecting and without understanding that they will be the next ones who will be slaughtered.

    I have one more mental experiment for all of you.
    Close your eyes. Tell me honestly what YOU BELIEVE. Which nation pays more taxes?
    Is it Germany or Italy? Don’t google. Just answer.

    • Sofia, that’s a trick question, Greeks pay the most taxes, and please Google it!

      If I can just point something out about your comment, you seem to be siding with Yiannis about Germany and at the same time you say Germany owns the media.

      If Germany owns the media in Greece then why is the Greek media so anti Germany?

      If I can answer my own question, Germany wants different things from the banks & the EU.

      Greece is caught in the middle of a battle between people who want money that is worth something and people who want to devalue it.



    • Richard

      When Sofia says “THEY” she does not mean Germany.
      The elite has no nationality.

      The Greek media is not anti – German. Where did you hear this?
      Most mainstream media are pro-memorandum and keep their mouths shut about any manipulation and criminal activity.
      Greek ,German whatever.

      Others on the other hand found an opportunity it seems to become more honest (they were’t allowed) ,because of the crisis and dig a lot deeper than usual.

      Be sure they do not talk against Germany unless she is to blame for something. And they talk against the Greek inanities ,exactly as they should have been doing years ago.

    • @Richard
      There is a difference between the German media which clearly echo the official political narrative concerning the whole eurozone crisis and the “global” media that somehow offer a more balanced view of the eurozone crisis and focus more on the deficiencies and failure of the European political establishment. The most objective POV in my opinion can be found among the US media.

      You are making a big mistake when you say the Greek media are anti-German. This is a wrong assumption. In fact apart from few blogs there is hardly an criticism on Germany. In fact I would welcome more mainstream criticism in Greece of the European leadership actions. The mainstream Greek media are wholeheartedly pro-bailout. They are also notoriously introverted. If you followed the Greek media you would think that the solution to the entire eurozone crisis falls on the shoulder of the Greek political establishment. Up until 2009 the names of prominent European politicians did not even make the news. People knew nothing of vital European institutions like the Europian commission or the Eurogroup. This was a byproduct of the cozy relationship between the media moguls and the politicians planning to keep the public completely in the dark. The Greek media are focused on Greek politics and nothing else. Period. The only anti-German remarks in the Greek media has been remarks from politicians looking to shift attention from their own responsibilities and failing miserably at that if I might add.

      I think that this attitude, that I have also personally encountered among my German friends, namely that the people and media in Greece are focusing on Germany for their troubles is 100% a product of the way the German media are presenting the situation in Greece and does not come from remarks in the Greek media which have been extremely sparse to say the least. Even the hardcore leftists do not focus on Germany, they obviously reject the bailout but their rhetoric is mostly anti-capitalist, anti-free market and focused on blasting the government. Very few people accuse (rightly if I might add) the political leadership in Germany for their flawed and damaging strategy concerning the eurozone but that’s it. And that has been found only in small corners of the blogosphere. Everything else comes from the blame game the european political establishment has been playing at the expense of Greece.

    • Tasos, about the Greek media being introverted, I think all that changed when Papandreou said the measures were out of his hands and that the Troika made him do it. This is now accepted wisdom.

      Also, you say introverted, but all I see in the Greek media is Troika this Troika that, Memorandum this memorandum that, Schauble said this, Merkel said that etc etc.

      I wish I could say I had read anything which said the Greek government are to blame for the current crisis.

      Okay people blame PASOK, but they blame PASOK because they think PASOK was weak in the face of the Troika. They don’t blame PASOK for its actions.

      From the anti German Greeks I have met, all of them without exception believe either the problem is Merkel telling the Greek government to increase taxes, which she is not doing.

      Or they blame the Troika for the measures the Greek government undertook when it is the Greek government that decided the course of action, the Troika simply sets the targets and gives advice.

      So think my point still stands. At least since 2008, many Greeks think the problem is with the Troika and/or Germany, directly or indirectly, when in fact it is the Greek government that has put Greece on the kamikaze course.

    • My Greek friends are much more critical about Greece than the GErman media. Example: “We always joked the Greece was a whorehouse. But it is actually worse. At least in a whorehouse things work in a certain order.”

    • “At least in a whorehouse things work in a certain order”

      And you get a service in return for your money.

    • @Richard
      There is absolutely no doubt whatsoever to anyone living in Greece that the mainstream media are pro-bailout. The media do not blame PASOK for not standing up to the Troika, they blame PASOK for not doing more. It is also true that they act schizophrenically from time to time. Asking for immediate vague magic bullet like measures one day, only to yell bloody murder when exact measures arrive the next to avoid completely alienating their readership or viewers. Even the PASOK government which controled and used most of the media against the people in the first year of office was frustrated by that. The Troika and Scheuble comments you are referring to pop up whenever a tranche payment is near and are used invariably as threats against the people.

      It is funny to read the words “wisdom” and “Papanderou” in the same sentence! The consensus about him is that he was completely out of his depth, if not outright incompetent. Nobody believes that the Troika can make you do anything around here. There are consequences of course if a government decided on a different course but nothing like that was not even hinted during his time of government.

      If you want something to read about how the previous PASOK government was largely responsible for the current situation Greece finds itself in try the latest piece of the NYtimes. In that mr Roumeliotis Greece’s then representative in the IMF says that the program was doomed right from the start, that the IMF had no previous example of success for something like that and that Papandreou was to blame for not pushing for a debt restructuring right then and there. He also notes that the terms Papandreou accepted was too harsh from an economic point of view. The piece made an appearance in the local media but not first page news in most cases. Mr Roumeliotis works in Greece for the past year and a half I think but it did not cross his mind to give these facts to any local media. What does that, tell you about them?

      On a final note about the media, all of them are nearly bankrupt now. They depend on absolutely vital lines of credit from equally bankrupt Greek banks. Who controls the banks then? Take a wild guess. The local government and the Troika do.

    • Sofia – I think we agree expect the last bit, the banks are the end of the line. No one controls them, they are the top of the food chain together with the central bank.

  • My post got lost.

    Here again – in short:

    I have another mental experiment for ALL of you guys.
    Close your eyes. And answer one question. Which nation do YOU BELIEVE pays more taxes (as percentage of GDP)?

    Is it Germany or Italy?

    Don’t google. Just answer.

    • Dear Sofia
      Tax as percentage of GDP is a matter that is within the authority of the individual country. Depending on the underlying culture, preferences and not least fiscal requirements that result from that, it can vary significantly per country.
      Higher is not better than lower (or the other way round). Denmark has a very high one, Switzerland a low one. It does not matter as such.
      What does matter, though, is that your debt should not spiral out of control. Whether you manage that with low or high tax rates is up to the individual country and due to the preferences that the voter can express in the elections.

    • Don’t exaggerate. That’s not at all a ‘mental experiment’.

      It ‘s a simple and completely irrelevant guess what you ask here.

    • The correct answer is Italy. But the black/grey market is not counted towards GSP and it is much bigger in Italy than in a normal country.

      Now the great prize question: Which nation do YOU BELIEVE pays more taxes (as percentage of GDP)?

      Switzerland or Greece?

    • In any case, it is not Greece 🙂

      ” The Financial Crimes Squad (SDOE) on Thursday reported that six in 10 businesses inspected at popular tourist resorts were not issuing sales receipts, and that of the 1,410 checks conducted in July, 57.1 percent found business owners to be in breach of the law.

      SDOE officials said that they recorded a total of 22,435 infringements during their sweep, and that their efforts will continue throughout the summer.

      In Zakynthos in the Ionian and Rethymno on Crete, every business inspected was breaking the law, while on the islands of Paros and Myconos, 70 percent were avoiding taxes.”

    • @VSS:

      How many tax evaders do you have in our country my dear singleminded German ???

      Have you completely forgotten about all the German tax evader accounts in Switzerland and Lichtestein???

      How many Steuer-CDs did your revenue service have to buy from Swiss bankers in order to track all your German tax evaders???

      You seem to be completely clueless my ignorant German friend 🙂

      Allein in diesem Jahr werden 150 Milliarden Euro vererbt. Doch der Steuerstaat, der die Arbeitenden hoch belastet und die Vermögenden schont, wird davon kaum profitieren: Deutschlands Erben tragen zur Staatsfinanzierung weniger bei als Deutschlands Raucher.


    • n eu d


      But i do not think they try to manipulate the people there constantly and steal its livelihood. Nor do they want to sell their own country to foreigners and betray their people by hiding from them the trillions of wealth their land has.

    • Demetri. Wrong. It used to be Greece. recently it is more or less equal!

      So one is an official tax haven paradise and the other one a tax cheaters paradise.

  • Greece will leave the Euro. Voluntarily or otherwise. It’s a matter of time…

    • This is an intelligent blog, not a place to post trash.

      The voluntary part, I just ruled it out.

      Now explain with you little, malformed brain the “otherwise” part.

    • One thing’s for sure, this is a very badly moderated blog. Almost nowhere else would a blog owner publish such a personal insult of another commenter. In some countries, this would even have legal consequences. Is this the kind of debate you want to promote, Prof Yaroufakis? That’s embarassing.

    • Dean has been on here before all of us, he gets some latitude in my opinion.

      Legal consequences, personal insults, I should not have to say this but if you use a fictional name and someone insults it, how exactly is that personal?

    • Gee, Dean take a breath! The only trash here is the level of your language.

      If my comments are trash, then so are Citigroup’s economists. (No, don’t answer that one!)

      ** “90% chance Greece leaving the Euro within 12-18 months”

      Is it beyond the realms of reasonable possibility that:
      1. The Troika will find some technicality where Greece has not met their audit requirements, finding reason to kick them out?
      2. Assuming there is a limit to the funds from the ECB, wouldn’t Spain/Italy be keen to redirect Greek funds to their own needs?

      Exactly what part of that reasoning is malformed?????

      Clearly, you have a massive chip on your shoulder. If we’re not all stamping the Greek flag on our forehead, it doesn’t mean we’re anti-Hellenes. (Although there are some in recent times on YV’s blogs who have been clearly so).

      You’re killing the opportunity for the bloggers here to have a reasonable discourse.

    • A further reply for Mr Dean Plassaras.

      From an alternate perspective you may very well be right Mr Dean.
      There are so many more people blogging on YV’s site in the last few months.

      The vibe, as I see it on here now, has changed in recent times. It seems that many of the bloggers are Europeans really trying to come to terms with the significant changes occurring around them. To create a new meaning, a new, more hopeful reality perhaps.

      No one needs a smarty pants non-European with little skin in the game.

      Good luck all. Wishing you the strength, focus and wisdom to get there.

  • Now we are getting ready to rumble:

    This morning we had the bavarian finance minister say on prime morning TV “Greece will exit anyways”. and “We need to make an exampke of Greece. So that others will not break agreements. Otherwise the whole South will ask for and get bailouts, but they will not carry out reforms.

    This afternoon in Handelsblatt Germany: Draghi is looter of (German) national wealth


    Now, the second one I really like!

    • Another nice one just came out in die Welt: “ECB turns out to be a Trojan Horse”.

      Given the very pro Euro German media one could say “Since this moring we are shooting back”

    • N EU D
      Some folks think that repetition makes a lie to turn to true. On a long run it never works. You should know that. Dictates are not agreements; dictates are a form of rape. The Greek parliament if they were not puppets should pass a law to make a criminal offence to every Greek who somehow tries to work with foreign dictators.

    • @For all non-Germans and any not singleminded, not prejudiced and not biased people in the world!!!



      “This morning we had the bavarian finance minister say on prime morning TV “Greece will exit anyways”. and “We need to make an example of Greece. So that others will not break agreements. Otherwise the whole South will ask for and get bailouts, but they will not carry out reforms.


      We need to make an example of Greece. So that others will not break agreements!!!

      We need to make an example of Greece. So that others will not break agreements!!!

      We need to make an example of Greece. So that others will not break agreements!!!

      We need to make an example of Greece. So that others will not break agreements!!!

      We need to make an example of Greece. So that others will not break agreements!!!


    • Aris – He wants to punish the Greek government. So do Greeks. What is your problem?

    • They should make an example out of those Greek people that accepted the bailouts. The only problem is that these people are their own partners so ,the Germans ,shedding their own responsibility talk generally about Greece and still accuse the population.

      They do not want to accept their own part in this mess as usual.

      Draghi being a looter of German national wealth i find hard to believe ,since everything ,from the start of this crisis ,was orchestrated by your government.

      Most possibly ,your government wants to keep fooling the German voter into thinking it did everything righteously.

      The trojan horse was Germany herself and the ECB was her tool. Now she wants again to transfer responsibility by accusing another one of her tools. The German government consists of people that would sell their own mother. One betrayal after the other. Amazing!

    • NEUD (aka Nude a la tête):

      You are so out of touch with what is going on.

      Do you mean to say that while the 3rd bailout for Greece or OSI (Official Sector Involvement) is in full speed, that the germans will make an example of Greece?

      This is the most unintelligent thing I’ve heard for a while. Instead of responding to the daily propaganda (whose purpose in none other that throwing the other side off concentration) why don’t you spend sometime understanding what is going on?

      Grexit is nothing more than a German fantasy for geezers. Why do you people delight in such press? Don’t you understand that all the real deals are made on the inside?

      And don’t you understand that Merkel is no long on the inside in most of this? The decision has already been made. Like any other good German, Merkel will be summoned soon, be told what is expected of her and let go to execute.

      You folks are no longer the decision makers in Europe. We have closed down your shop.

    • EU Dict, Bav finance minister – Did you read that as an attack on the Greek government or the Greek people?

    • @Richard:

      “EU Dict, Bav finance minister – Did you read that as an attack on the Greek government or the Greek people?”


    • Aris, do me a favour, take your summer holiday in Greece, speak to some Greeks about what has happened and tell me if you think it is a funny situation

    • “Aris, do me a favour, take your summer holiday in Greece, speak to some Greeks about what has happened and tell me if you think it is a funny situation”


      I didn’t say that the situation in Greece is funny! I said you are funny because you interpreted this bavarian politcians statement in a peculiar way 🙂

    • Primarily on the government(s). But the Greeks have elected them and have the power to remove them. I do not.

    • @N_E_D:

      “Primarily on the government(s). But the Greeks have elected them and have the power to remove them. I do not.”

      Spare us with your lousy excuses and your German hypocrisy !

    • Richard

      The rational mind will think of the Greek government.
      Unfortunately we already had too much of personal attacks from officials too.

      So ,drop it. Repeating the opposite of a behaviour that is known to all by now all over the world ,will not make it true.

      I personally had warned certain individuals about this.
      I said if you continue this game you yourselves will be defamated.
      It is interesting that even now you try to deny the obvious ,when even today personal attacks continue.

      Separate yourselves from the official Germany as soon as possible.

      If the officials want to target the Greek government only ,they should make it clear and apologise. But they have repeatedly shown the opposite with the cooperation of the media. They wanted this government. These statements are games for the German voters.

    • Demetri – “If the officials want to target the Greek government only ,they should make it clear and apologise.” – Your right. Problem with that is that Germany will be blamed for starting a coup.

      “They wanted this government. ” – Im open to the possibility, the biggest give away to this perspective for me is that they gave money in the first place. I need more info to be convinced though. – Whatever the case may be, if the Greek government sorts out the trade deficit then it doesn’t matter what Germany does

    • Dear Aristoteles

      Sorry – I did not get what the German nutcase said. Could you repeat it once more, please?

  • Since it is sure now, that the Euro zone will be composed differently pety soon. I have a question regarding the modest proposal:

    What effect would it have on the modest proposal if the Netherlands, Finnland and Germany leave the Eurozone? Assumption: The EIB would not act proposed, but as it did in the last 10 years.

    • The Modest Proposal is meant as a plan to save the eurozone. If the suplus countries were to leave, forming perhaps their own union, the Modest Proposal would cease to be relevant. As, of course, is the case with the EU itself – since the single market would shrivel and die.

    • One could argue to have 2 currencies, one in the North (let´s assume the North exits the Euro) and one in the South (incl. France)

      Most people agree that the currency in the North would work, it even did work like a union in the snake.

      Some people say the Euro which would be kept by the South would not work. But wouldn´t it work implementing the modest proposal? You can even assume to have 2 common markets. WTO & GATT made the free market more or less irrelevant anyways

    • Dear Yanis
      Sure it would be a blow to the EU if the Eurozone fell apart. But I doubt it will – possibly Greece will leave (and maybe Portugal, Spain and Italy, absolutely worst-case). But the rest would stick together, maybe being able to welcome a few new members like Denmark, the Czech Republic, Poland, Latvia and Lithuania – who knows.

      Anyway: even if the Eurozone disintegrated completely, I would expect the common Market to continue. And also the EU in general. The clock would kind of turned back to the early nineties. Which wouldn’t necessarily be a bad thing if it takes the tension out of the system?

    • “And also the EU in general. The clock would kind of turned back to the early nineties. Which wouldn’t necessarily be a bad thing if it takes the tension out of the system?”


      you are dreaming my friend! After all the conflicts, prejudice, rants and economic desasters I guess Germany will be completely isolated (excluding your satelites of course 🙂 ) as after WW2 !

      So you play with the fire my German friends! If the Euro breaks up than the EU will disintegrate next which means that you will also loose China as an export market for your products since the EU-China agreements will be done and dusted 🙂

      Don’t forget also that after the iron courtain has fallen you are less important for the US than lets say GB or FR!

      I promise you a very dire and dreadful future in case you continue destroying Europe like you did another two times in your “glorious” German past 🙂

    • Dear Aristoteles
      Your apocalyptic phantasies are entertaining.
      I don’t see much parallel between WW II and now. The pariah if anything is Greece. But, like Germany then, they don’t see it.

    • ” I don’t see much parallel between WW II and now. The pariah if anything is Greece. But, like Germany then, they don’t see it.”

      Martin how dare you compare Nazi Germanys barbarian bestialities with the current economic problems which Greece has?

      What you say is dreadful and shows your lack of morality!

    • Dear Aristoteles

      How dare you compare the current situation and Germany’s behaviour with that of the Nazi time.

      What you say is dreadful and shows your lack of morality!

  • Practically you are wrong. One or two days ago was in the news that 21 trillion dollars or something like that are stashed away by people who don’t have a clue what to do with them. Greeks, Italians, Portuguese, Germans, Americans as a continent don’t have money to buy, no demand. So the problem is in uneven distribution of wealth of the world.
    The Germans have it all wrong, we don’t need slaves, and we don’t need bigger efficiencies. The problem is that the technology which we already have and the fast coming technology will create huge problems for distribution of work and the money. If a worker can make several cars a week, if a farmer can feed 500 people, if a printer can print products without any further need to work, we really have a new problem which is not the problem that is fed to German folks.

  • The revelation that the IMF knew that the Greek program had no chance of success, made executive vice president of Piraeus Bank and former representative of the country to the IMF, Panagiotis Roumeliotis.

    “We knew in the Fund from the beginning that this program could not be applied because we had no success story,” he said speaking to the New York Times.
    Explains Mr. Roumeliotis, countries that implement IMF programs usually do that to devalue their currency to strengthen their competitiveness. This, according to him, for Greece is not feasible because it is a member of the eurozone.

    “The argument often used by the troika to criticize Greece – and to ignore its faults – is that the deep recession is caused because structural reforms are not implemetnted,” stated Mr. Roumeliotis.

    • Demetri. You understand that Roumeliotis has an agenda and cannot be trusted.

      Either he wants money printing in Europe or he wants the Drachma, that is the only way his bank can survive. He cannot live in an economy with honest money because he would have to start telling the Greek government to borrow less money from him which means he would see his profits cut.

      He is a businessman.

    • Roumeliotis is a colleague of mine, and a professor of economics. He was recruited by Papandreou to represent Greece to the IMF, and operated as a state employee who was accountable to the Prime Minister. Apparently, his advice to Papandreou was ignored (what a surprise!, given Papandreou’s stupid arrogance). Now Papandreou and his cronies deny such conversations.

      I am quite prepared to believe him, regardless of his recent affiliation to Piraeus Bank. He is an honourable man.

  • Steve Keen (University of Sydney): The euro should not be considered currency – is simply a special purpose vehicle that turned the crisis into a disaster – They can not ever be … the United States of Europe

    The euro is the currency of a country that does not exist. In spite of the continent’s existence, like the U.S., there probably never will be … the United States of Europe.
    The above said ground-breaking Australian economist, Steve Keen, from the University of Sydney.The euro is therefore not the same to the dollar, however, obliged to mum as such because of – bad – Maastricht Treaty, says Keen.
    Indeed, the euro looks more like a … special purpose vehicle (Special Drawing Rights) and less with a currency. “The euro is controlled by a pro – national authority, the ECB, while Member States are punished when they break the rules for government spending. The euro currency does not resemble a currency, but rather a special purpose vehicle,” comments Keen.
    The euro, he continues, because of the imposition of sanctions and punitive attitudes is the reason that the crisis turned into a disaster. “The euro is trying tobe a coin, but it is not,” he adds. As he explained, some economists believe that the solution to avoid the current situation and the collapse … destroying Eurozone is to create something that does not exist, namely the United States of Europe.
    “But even if the creation of the United States of Europe is a chance, it can do nothing about the destruction caused by the Maastricht Treaty and the Franco-German insistence on imposing austerity in the European region plagued by the debt crisis” he says.

    • Demetri, Steve Keen is amazing. But he is wrong here. He is getting his information from the media which tells him there is austerity in Greece when there is none. There are only taxes increases and pension cuts for the poor from a psychopathic government.

  • @Klaus Kastner:

    “Pardon my French, but this is a silly comment. Do you think all states in the USofA have the same competitive position? The difference is that Americans accept that and you don’t seem to accept that for Greece. Any difference in a competitive position and productivity in a currency union is neutralized by the living standard. If people in Alabama are not happy with their living standard, they move elsewhere. If they prefer to live in Alabama, they accept that state’s living standard and don’t complain that the Floridians have a better living standard. Period!”


    What you say is pure German economic idiocy but I won’t respond to you.

    I will let Dom Boyle respond to your stupid comparison with the USA:

    We knew the euro was a bad idea in 1961. What went wrong?

    The eurozone is emphatically not an optimal currency area.


    • What I am saying is based on 23 years years of working for and living with Americans in the South, in the Northeast and in the Midwest. I am sure you will agree that this is a pretty good sample.

  • So ,what do we have so far?

    We have proof of the betrayal of the US for the invention in Cyprus:
    Maps from the Kissinger archive with a divided Cyprus long before the invasion
    And we have proof of the Simitis government’s betrayal concerning IMIA.
    We have proof of the IMF activities all over the world:
    We have proof of the German corporation scandals connected with Turkish interests:
    We have documents from the 1940 till today about the wealth of Greece and the connection of foreign interests to it.
    We have the use of the euro as a tool to bring about financial distress. Especially in Greece. We have proof of production destruction in Greece according to the wishes of the benevolent leaders of the EU.
    We have proof that the euro could have never worked as they designed it.
    We have financial proof of the manipulation of the EZ by the German government with the exhortation of the US.
    We have a memorandum that is the worst ever devised and impossible to implement. A memorandum which has as the most basic demands ,loss of sovereignty and all public wealth.

    We have a setting ready for the Turks to demand a big piece of the drills to take place in the near future. With the blessings of America.
    We have Clinton coming in Greece to prepare the way for energy exploitation.
    We have the minister of external affairs of America travelling to Greece and Turkey ,to “resolve” the Cypriot and Turkish matter by proposing to Greece to shrink her borders and Cyprus and Greece sharing the piece of energy exploitation with Turkey.
    We have Barosso coming in Greece hastily because Clinton’s visit forced him to.
    Clinton: I came to give. What will i take?
    Barosso: Let me ask Rothchild.
    Now Barosso is to spend 4 days in Israel!!!!
    We have proof and historical proof that Germany’s power and hegemonic behaviour is used for the interests of others.
    We have proof of Goldman Sachs (and of other financial institutions) manipulation and its intervention to affairs of other countries. We have proof that in each and every country politicians are connected with Goldman Sachs.
    We have proof of internal cultural attacks against Greece and its history.


    America wants to preserve her hegemonic identity. The euro is a tool to be used to bring about the much wanted control of America in the Med..
    Germany’s nationalistic tendencies are to be used for the economic attacks that are necessary for the appropriate setting.

    Goldman Sachs in knowledge of Germany help Italy ,Greece ,Portugal etc. enter in the EZ.
    Schroider had relaxed the rules for this purpose.
    Kostas Simitis (Aaron Avourtis) agrees. From then on downhill for Greece.

    Germany ,with the blessings of America ,unleashes an unprecedented propaganda and economic attack against Greece. IMF prepares the known tool that is to be used for fiscal changes that allow for psychological warfare against the population.

    The Greek government is found between local and foreign interests. The individualistic behaviour of the Greeks stalls the recession. The new elections give Germany and IMF the right to continue the attacks but the crisis is spiralling out of control. America understood this. Germany didn’t. The reforms in Greece (specifically the privatizations) have been delayed because of the elections and now the IMF “plays” the “i want out card” so that America can now play the good cop against “Germany”. America would have intervened even if the reforms have been implemented.
    America does not want Germany to get Greece. Too much power.
    Who does? Germany served her purpose.

    America comes to Greece to prepare for energy exploitation. EEZ is on the way.
    Turkey will be used by America ,so that Greece backs off and allows for common use of the resources.

    Baroso prepares for the post-Merkel era of European hegemony. Baroso was the prime minister of Portugal in 2009 when Portugal bought 33% of Greek debt.
    Small Portugal bought Greek debt without any reason that justifies this move.
    Do we have the reason now?

    Now Baroso travels to Israel to meet with the high bosses of America and get a good piece of the pie that is called Greece.

    From the North of Greece we have preparations of the final talks for the name of Skopjie
    They ask for the area of Macedonia.
    Albania is preparing for a “Great Albania” by getting the Greek Thrace.
    Bulgaria which was one of the victims of the IMF support any move (also against Greece), since it has in its sight Skopjie.

    American institutes help the “benevolent” causes of every country.

    Back in Greece ,value is decreasing ,moves for the sell off of the public property continue ,elite investors prepare to grab a piece of the land ,Germany has the choice to choose which companies will use the Greek land (there goes the excuse of “free markets” and bringing foreign investors by reforming the country) ,the same time the bankers make a lot of money ,by cleansing their positions of Greek debt ,which on purpose they acquired.

    Worst case scenario:
    Greece is no more. Not as it was.
    America with the cooperation of Samaras gets a huge piece of the action before Germany implements the last reforms for control of the land. Turkey is in it and is pleased for now.
    Later Germany controls enough of the wealth of Greece and while the US give a huge share to the Greek state from the drilling ,the money are transfered to Germany and friends.

    While there are no real friendships between countries and everybody works with everybody as also everybody works against everybody ,they certainly have the common characteristic of everybody working against Greece first of all.

    A blessing and a curse the position of Greece.

    Best case scenario:
    Greeks WAKE UP and get the hell out of the memorandum.
    The government is replaced. No loss of sovereignty ,no loss of Greek land ,no pleasing Germany ,no pleasing Turkey ,no pleasing Skopjie ,no pleasing Albania ,no pleasing America.
    EEZ is established ,deals for drilling with either private companies of the US or Israel or with Russia.
    If no honest NATO protection from the US (who am i kidding) then NO DEALS WITH AMERICA.
    Greece has the manpower and knowhow but not the company to drill by herself.

    Problems arise as it is natural. Military attacks from Turkey become the norm.

    If you want peace ,prepare for war.

  • Dear professor,
    The scenario that has been discussed here for the past two years is how to combine the economic crisis with further integration, viable economic policy for all member states.
    Some of the comments are against the EU.
    But all that has been done in the EU points to a different scenario that is being followed.
    Anybody can reach this conclusion once agreed that what is being decided and done follows a pattern and is not done out of stupidity.
    EZ is a monetary union without a political and a fiscal one. Remaining like this in the middle of such a crisis means that large amounts of money will move from some areas to some others, thus making the imbalances that existed before the crisis, gigantic
    It is remaining like this, and this cannot be a coincidence.
    Someone is benefiting from this in the short run (as you pointed and we discussed many times here), but it would be very stupid if all this would not have a perspective.
    In the short run Germany profits through low spreads and money being accumulated from the periphery, which returns in the form of loans to the periphery.
    When things go on this way, there will come a time when the poor which is getting poorer will be unable to control their fate, and will be fully dependent on the rich.
    So far in the EZ only Greece has crossed this line.
    In Spain things don’t seem to have a different perspective. They thought they reached an agreement for the money their banks needed, but Germany is kicking this agreement down the alley. In the meantime Spain did take the austerity measures that will shrink their economy further (another periphery leader, Monti said cynically in front of the camera that the measures are taken in order to please Merkel, that means that nobody takes seriously the hypothesis that the austerity measures will work).
    So next time Spain will ask for help the money needed will be much more and so on, and there will come a time when it will become clear that it cannot pay back its debt, so in order to receive money it will give away sovereignty.
    This is the way Berlin wants the goal of integration to be fulfilled. All member states will be consumed in a slow, controlled and painful framework. Possible derailments will be prevented with small help (always smaller than needed so that the downward spiral continues with the desired speed. Draghi speech yesterday was so small help that Spain would slow down its fall.
    This is the way the core will be consumed also.
    In the end Deutschebank and Siemens will be the leader of EZ.
    EZ is not going to break.
    Germany is not going to get out as it will lose the money it has lent to the ECB and the EZ.
    Greece is not going to get out either. Germany has Greece for free now. It would be stupid to let go.
    When all this is over we will also have Eurobonds.
    And when the markets understand there is a new leader in the pack, and a determined one (not a bunch of crazy people dancing tarantella) they will be relieved and lend money again.
    Europe is going back to the early Middle Ages.

    • “When all this is over we will also have Eurobonds.”

      What problems are really solved by this? They did not even work in Switzerland, where several communities pooled their debt. The result was that Leukerbad spend like crazy and needed to be bailed out be the others. Noone bought these bonds anymore.

      It will only be a convergence to the lowest level, like in communism/socialism.

  • @klaus
    Just be serious here! Its same like they did in east germany with “Treuhand” ( dont know the english name for it). Just buying cheap: eg water, rails and trains, post and phone and so on. Its everywhere same like Naomi Klein wrote in her Shockdoctrine. It was Southafrica, southamerica, it was asia and us and uk and is in europe now! All time same game like “Divide et impera!” And everywhere people are too foolish to see. Same here in germany. They are all and everywhere too dumb to see that the real thieves are already gone with their money owning their factories and leaving all as slaves. And as long as such a huge mass of folks is blind and cannot see it, they will do it over and over again. And there is no reason to believe its only Merkel. You can change her name into any other… Its just one of the elites, no matter which nation they belong to.
    And it does not matter at all if we think about solutions or buttons, we all have to stand up against it, thats the only way to cross their plans.

  • @Martin:

    ” How dare you compare the current situation and Germany’s behaviour with that of the Nazi time.”

    Very simple Martin, I compare the current situation with that of the Nazi time because we see signs of racist and even fascistic behaviours and political beliefs in Germany!

    Thats all. I am not saying that all Germans share these views and believes but I find it nevertheless alarming what some of your politcal, media and economic elites are perpetrating.

    I hope that helps you to understand the difference between my comparison and yours!

    • Well,Aristoteles, you dont have same signs of racism in Greece against for example Arabian? Is that same? Does anyone try to punish racism in Greece like you do try to punish germans? Its always same, stuck to “kleinklein” while “HUGE” is ripping off the small.

    • @dalena:

      “Does anyone try to punish racism in Greece like you do try to punish germans?”

      Did I say that I want to punish the Germans? You are mistaken. I don’t want to punish anybody.

      “Well,Aristoteles, you dont have same signs of racism in Greece against for example Arabian? Is that same”

      The situation in Greece is very different from the situation in Germany! Besides the fact that Greece is undergoing a historically unique economic depression during the last two years plus, it has also to deal with a flood of illegal immigrants which make according to some sources up to 15 percent of the total population.

      If the same situation happened to be in Germany than I am pretty sure that the radical right would have reached record levels like before the rise of Hitler in the past.

      So no I don’t think that the situation in Greece is comparable to that of any other European country!

    • Aristotle, the number of “illegal immigrants” who arrived over the last few years is a maximum of 150,000 of which at least some are genuine refugees. That makes it about 1.3% of the total population — rather low in comparison with the 11 million in the USA (>4%).

      Do not believe the Greek police propaganda, where they include people with expired permits because they lost their work. Those poor people are no more illegal than any Greek, even within the jurisprudence of the European Court of Human Rights. The problem is with the Greek state, which tries to make everyone and everything illegal other than itself.

  • Yanis: Pretty much everything you have written over the past two years has been proven right. But, don’t you agree with British economists such as Martin Wolf or Simon Wren Lewis that it’s David Cameron and George Osoborne who are in the easiest position to press the red button with expansionary fiscal polcies to grow their economy out of the debt crisis since yields on British gilts are extremely low due to flight from euro periphery and zero insolvency risk in the UK? That is, while the euro zone needs radical redesign to be able to pursue rational countercylcial fiscal policies without raising fears of insolvency in Spain, Italy etc, the UK could do it as easily as pressing a button thanks to its having its own currency. I’d be very interested to hear your thoughts on this. Andy Robinson, La Vanguardia (Spain)

    • Hi Andy. Thanks for the kind words. And yes, you are spot on: Cameron has cornered himself into a self-imposed stagnation that is causing unnecessary pain and misery. He fails to grasp that, while Thatcher-Lawson had also put Britain through untold and equally unnecessary pain (through restrictive monetary and fiscal policies), they had at least had the chance of creating the circumstances for the inflation of the mother-of-all-bubbles (in the real estate market and the City) which carried them through and ensured that the British working class (that was still at work) was more or less co-opted. Cameron-Osborne do not have this option, in the post-2008 world that we live in. Thus, they will end up with egg on their faces much much sooner…

    • Andy – Are you saying printing money makes the general population richer?

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