Riots in Greece, huge demonstrations in Spain and Portugal — the peace bought by the European Central Bank announcement earlier this month that they would buy unlimited quantities of debt from troubled euro economies appears to be broken as political instability now threatens to undo efforts to address the debt crisis.
On Tuesday in Spain, tens of thousands of demonstrators besieged Parliament to protest austerity measures planned by Mr. Rajoy. Last week, more than half a million people marched in cities across Portugal to protest an increase in social security contributions, and a million marched in Barcelona calling for Catalan independence.
In Athens, trade unions called a nationwide strike Wednesday to contest billions of dollars in new salary and pension cuts being discussed by the government and its international creditors. It was the first such walkout since a conservative coalition led by Prime Minister Antonis Samaras came to power in June.
Samaras has his hands full negotiating a $15 billion austerity plan with his socialist coalition allies. The package is absolutely essential because the IMF, ECB, and EU government is currently in Athens examining the government’s efforts to get their budget deficit under control. At stake — a $40 billion tranche that Greece needs to stay afloat. Without it, they will be unable to pay their debt and will probably be forced to leave the euro.
Spain has different problems. It would be political poison if Rajoy were forced to go hat in hand to the IMF asking for assistance.
Mr. Rajoy has been trying for months to convince investors that Spain can handle its own problems and that it will not need a bailout that would force Madrid to cede some authority over its fiscal affairs to its lenders, and is set to introduce new cutbacks to meet budgetary goals. Those will include restrictions on early retirement and various measures to streamline regulations and fight unemployment, he said in an interview with The Wall Street Journal.
But it is Greece where the real danger lurks for social unrest that would lead to political instability:
The proposed cuts in Greece have ignited new anger here, with many talking openly of increased impoverishment as the nation grapples with a third round of austerity measures in three years. The demonstrations here were peaceful throughout the morning, as civil servants, teachers, medical personnel, bank employees and lawyers made their way to the city center. A police spokeswoman put the turnout at 35,000 to 40,000 people — modest by Greek standards.
But violence broke out shortly after 1 p.m., as a group of protesters wearing black face masks hurled gasoline bombs at police officers on Vasilissis Sofias, a wide avenue abutting the Parliament building, sending bursts of flame and black smoke into the air. Firebombs were also thrown at the Finance Ministry and into the lush National Gardens next to Parliament. Crowds scattered inside Athens’s central Syntagma Square when similarly clad youths destroyed a tent and set part of it on fire.
After a relatively stable few weeks, European stock markets plunged. Germany’s DAX index lost 2%. The Spanish stock market dropped nearly 4% and 10-year bonds inched toward the dangerous 6% range.
Just when Democrats are slapping each other on the back congratulating themselves on the coming Obama victory, a sharp reminder is given them that world events could easily trip up the president’s efforts at re-election and throw the race to Romney.
Just wait until austerity is forced on the United States due to currency implosion due to endless printing QE3) and spending (Congress).
Bring popcorn…
There’s one type of growth America doesn’t need: more debt growth.
The US debt just passed $16 trillion. It was $8 trillion 6 years ago.
Here is how fast Washington is adding to US debt.
**** NEW DEBT ****
$103 Billion – Average PER MONTH, 112th Congress
$143 Billion – Average PER MONTH, 111th Congress
$63 Billion – Average PER MONTH, 110th Congress
$45 Billion – Average PER MONTH, 109th Congress
$48 Billion – Average PER MONTH, 108th Congress
$23 Billion – Average PER MONTH, 107th congress.
Source: US Treasury Debt to the Penny
I recommend a Youtube video by a retired accountant who asks, Why can’t Washington balance the budget. He uses Treasury & White House URLs. I checked. All true.
Google Hal Mason Youtube debt
Unfortunately, our politicians control our currency. The Greeks and Spaniards would love to print up cash instead of cutting spending. (Ron Paul is saying “told you so right now)
If the Europeans actually impose “austerity” cuts and EU doesn’t fly apart, they will be better off than us in the long run. We are already feeling the inflation.
Exactly, our pain is just masked. There really is no good solution other than not shooting yourself in the foot in the first place.
Bring popcorn…
I’d suggest bringing precious medals like brass and lead.
The entire Euro zone is at the point made by Margaret Thatcher years ago; they’ve run out of other people’s money.
I haven’t heard one credible plan to get around the fact that Socialism doesn’t work. Period. It creates disincentives to work and produce, and it infantilize the populations.
I’ve also read reports of former Spanish construction workers resorting to foraging in the countryside for food. A large percentage of Euro zone population has made a living for themselves outside of any productive market. There are only so many government workers needed and as this shake out continues those determined to be in excess are going to swell the ranks of the unemployed.
The situation is dire.
It’s not just the borrowing costs that will become impossible for the weaker countries. Once the banks start writing down the debt and realizing the losses things will become desperate indeed.
There is never a happy ending to ‘cradle to grave’ entitlements. Once the money runs out, people will make a run for the leadership’s throats.
Consider: how many times have you witnessed a two year old in the throes of a meltdown? And, how many times is it made worse, when the adults in charge give in to the out of control toddler?
The socialists running amok have created generations of two year olds on steroids, fully capable of tearing the nation apart. And,as soon as the money really runs out in Washington, does anyone in their right, or left, mind believe the results will be any different? And, isn’t it entirely possible that the Radical-in-Chief (and surrogates) is looking for such mayhem, all in order to declare Marshall Law?
http://adinakutnicki.com/2012/08/31/red-hot-warning-from-northeast-intelligence-networks-director-dhs-issued-go-gearing-up-to-secure-election-for-barack-hussein-obama-if-polls-slip-commentary-by-adina-kutnicki/
Mayhem is certainly coming to many cities in the USA.
Btw, Van Jones, Soros, Ayers & their entire crew are planning their moves accordingly, hoping to set as many cities alight as possible.
The problem with the EU, as Vaklav Havel noted recently, is that different peoples cannot co-exist in peace. This was true of the Balkans, just as it was true of Havel’s Czechoslovakia, and just as it’s true of the EU today. Forget economics; whenever you have two subspecies of one animal species inhabiting the same territory, one is going to disappear.
Besides the austerity protests in Madrid, Spain also has to deal with agitation in Catalonia too. The Catalans want to keep their money in Catalonia and don’t want their money subsidizing the Castilians.
I saw those reports too. The breakup of Spain might happen in the near future. Pleas to stay united for the sake of the national soccer team will fall on deaf ears.
The same tensions exist in Italy. The Northern League has long advocated independence for “Padania” to stop Rome from looting the prosperous north via taxation to subsidize the poor south.
Then there’s Belgium, where the Flemish for years have longed to secede.
The inevitable breakup of the US won’t be pretty, but once the dust settles we’ll be rid of the socialists who flee to the “blue” states. Meanwhile, the “red” states will benefit from conservatives relocating in the opposite direction.
Of course we cannot COUNT on Europe blowing up, at least before the election. Oh, it may very well go kaboom before then, despite everything they’ve tried the EU is fragile as heck and it wouldn’t take much to tip it. Still, it could be months before it really hits the tipping point and the whole thing comes crashing down.
Still, I think EU unrest and stability could very well thrash the stock market in America. Especially now that QE is essentially factored in and done. Interestingly, rumors of QE does more than QE itself, funny thing that. A few poor weeks of performing stock markets would do a lot to help the Romney campaign. The two numbers people pay most attention to as an economic gauge are the employment rate and stock market. I think most people probably realize the baseline employment rate is hecka manipulated by now, so even a week or two of bad stock market news would do a lot to remind people of actual reality.
As part of the tracking of the real story of global education and the economic vision embedded in it, I learned a great deal about the dirigiste relationship in Europe between government entities and Big Business. Cultivating credentials and limiting Competencies that are designed to create dependence also creates expectations for the future that cannot be met.
When Obama came into office Europe was about 10 years ahead of us in using education to infantilize and manipulate a majority of future voters. We have been in overdrive now and the plan is to get all caught up, K-12 and higher ed, by 2015. Consciously Creating Future Voters with no real marketable knowledge and skills who have been taught that economies and societies can be redesigned for the common good. Where are they likely to turn for someone to do something to see that their expectations for the future are met? Why do you think the Club of Rome has made Full Employment the basis for their centrally planned global economic policy for the 21st century?
Use the power of the state and coercion of the individual to break what works in the first place. Then use the breakage to justify more power to coerce and break.
Shampoo, rinse, and repeat until the state dictates all in a Corporatist alliance this time.
Robin : It’s called Cloward-Piven or Obama’s “fundamental transformation”. Take your pick…
I hate to laugh but every time I ask an Obama supporter exactly what they thought “fundamentally transform” the US meant, it’s deer in the headlights on steroids. So, I ask in more basic terms: when you become the leader of the world’s wealthiest nation with the leading economy and most powerful military, and vow to transform it, how can that be good? Even simpler, how does changing #1 work to the good? None of these questions produces what would even charitably be described as a reasoned, substantive answer.
More on dirigisme. It puts economic power in the hands of a few. Anytime this is done dynamism is doomed. Economic dynamism is our forte in America. Systemic suppression of this talent may crush us to 3rd world living standards. Here is an article Robin wrote in May on dirigisme (she has a web site)
http://www.invisibleserfscollar.com/why-the-world-makes-far-more-sense-if-you-add-dirigisiste-to-the-things-you-understand/
Americans spent half a century focusing on an ideological enemy set out to destroy us. I remember Kruschev banging his shoe on a table at the UN declaring he would do so.
We haven’t been paying attention to the other types of tyrannies, or the other ways we are susceptible to domination. Dirigisme is one way for the few to dominate the many. Statists-Corporations work hand in glove. They become part of the ruling class and protect each other. Statist-Banks is another example.
Robin has some excellent insights on US education and particularly how fine-sounding names like “Race to the Top” or “Core Curriculum” are being subverting by “educators” who view the future of America through the Bill Ayers lens.
That is why they are hell bent on stopping homeschooling by anymeans necessary. Hell I can’t even get the busybodies to stop breathing down my neck and my son just turned four. I can’t tell you how many times people have asked me why he is not in school. They have been doing it since he was two because he has always been tall. Then you hear it through the grapevine that people are slandering you, lying that you don’t vaccinate your kids or don’t feed them right. When they are hellbent on your destruction, they will find any reason they can to smear you, even if they have to lie.
It’s all well and good to talk about austerity this and austerity that, but increasing government spending, by itself, doesn’t produce a booming economy. Nor does reducing government spending when REGULATIONS are closing coal mines, prohibit drilling for crude oil or NatGas, or make it impossible for individuals to enter a market, to produce a good or service in competition with established operators.
You can’t employ your own children on your own farm because of child labor laws. You can’t open a ‘farmers market’ on your own property because of local, and very restrictive zoning/licensing regulations. You can’t start up a taxi service because of restrictive licensing, you can’t start selling apples off a produce cart on the street corner because of restrictive local regulations. You can’t……you can’t. . .. you can’t start developing a new shopping mall or residential housing, or open a new mining venture, because of environmental restrictions, or litigation by environmentalists. You can’t even continue a profitable farming operation because a judge suddenly decides that a minnow is more important,and more deserving of water than your farming operation. Your previously profitable medical device, or new pharmaceutical is suddenly hit with a big tax increase simply because it IS profitable. Or you get put out of business by extortionate organized labor wage demands, or suddenly government regulations require that you provide health insurance coverage that you can’t afford. The list just goes on and on, and keeps growing by the day as more and more legislation gets passed by congress. Legislation that favors a select few, sometimes in obscure ways. Legislation that sets up yet another federal regulatory agency to regulate, even more than it was previously, yet another industry because that industry (banks, financial services, autos) is/was on the verge of bankruptcy. You can’t keep an economy growing when valuable assets are underutilized, or inappropriately utilized and locked up in a failing business that’s continually bailed out and propped up by government.
What was that guy’s name in Libya who set himself on fire because a government agent confiscated his produce cart and provoked the infamous ‘Arab Spring’?
That’s the trouble with group think. Everyone obsesses over, gets locked into, the media meme of the moment without understanding the intricate complexity of a working free market. Shutting down a corner push cart vendor selling vegetables results in the fall of a government. Refusing to allow someone to start up a corner push cart selling hot dogs leads (incrementally) to Greece, Spain, Eurozone, California, Illinois…yada….yada….yada….
One of my favorites is when the state is in need of revenue, so they go straight to the people who everyone loves to pick on, small businesses. They send out a letter, due to budget shortfalls we have created a new fee for you, oh and by the way it is due in three weeks. They wouldn’t dare take the free cellphones away from the leeches, so instead we are going to hit the makers up for some more pirate booty. We don’t own a cellphone other than a $15 a month emergency device because of my daughter’s peanut allergy. I would not be against emergency devices for the poor.
Another method is property taxes. If they can’t convince (or threaten) you into voting for new tax levies (those “temporary operating levies” that never seem to “sunset”), they just raise the tax-assessed value of your property.
The county I live in has done it to me twice in the last decade. According to the treasurer, my home is now worth roughly one and three-quarters the amount of money I paid for it ten years ago.
In a time of decreasing property values, please note.
They aren’t above hitting poor people, either. Here in OH, we have a program called Homestead, that reduces the property taxes paid by the less well-off. If you qualify, you can get a credit against the county taxes; it’s not cash, they have to subtract that amount from what they charge you.
Six years ago, the state legislature voted to exempt the first $25K of home property valued of Homestead recipients from being counted for tax purposes. So, if your home was assessed at, say, $75K, the new assessment would be based on a value of $50K.
Within a month, almost every country treasurer in the state had “re-assessed” Homestead recipients properties values upward- by anywhere from $30K to (in this county) somewhere in the vicinity of $65K each. Efficiently wiping out that exemption. Most homestead recipients ended up paying more property tax. Many who couldn’t afford it, ended up in public housing.
And yes, Democrats did it with the same alacrity- and cynicism- as Republicans did. The Dems opined that “poor people should be in public housing”, anyway. (Where on Election Day, they can be bused to the polls and “helped” to “vote the right way”, I suspect.)
The news media, supposedly the guardians of the downtrodden, only ever mentioned this bit of backstabbing on the back pages. Usually buried below the “Man Bites Dog” items.
Never underestimate the power of government to enrich itself at your expense. Or the ability of the “concerned and progressive” to justify any measure needed to extract that one, last cent from you, even if you’re the person they claim to be doing it for the benefit of.
For the “greater common good”, of course.
clear ether
eon
AMEN!
We are closer to the brink than many believe; if the US drives over the cliff early next year we will be forced to cut gubmint benefits drastically. Detroit and Watts will burn again.
“Detroit and Watts will burn again.”
So what.
Good Point!!
Seriously, it won’t stop there.
To purloin/distort a phrase from Apollo 13 “sometimes failure is the ONLY option”.
Hey, Europe! Money doesn’t just appear magically, and reality is a real bitch, isn’t it?
It is an open question in America if the police will protect the government buildings of the Obama/Clinton regime or not. So much evil has been done by this regime it is impossible to defend it on any count. The numberless drone executions, the aerial bombardments of civilians which started under Clinton during the War against Serbia; the millions and millions of abortions enacted by the Federal Government since 1973; the continuing onslaught against Christian Americans who must now flee to underground churches in order to survive and the constant use of Federal power against American citizens by the abcs of the Federal dictatorship; i.e. the ATF, FBI, DEA, EPA etc etc. The American government which is kept in power by corrupt elections had the gall to criticize the Putin election in Russia. The current American regime is in no better position than the shaky Greeks and Spaniards.
Why assume a European implosion will benefit Romney? Isn’t it entirely possible that it will be spun to benefit Obama? Government workers in the US (and private sector workers whose income depends on government) will do whatever it takes to prevent similar measures from being implemented here. That means bigger government (and Obama). (Possible theme: Vote Obama if you want to avoid riots)
The Europeans are beginning to bore me. Every time there is a “crisis,” the European Central Bank or the Germans seem to come to the “rescue,” they announce some sort of bailout plan, and the stock market goes up. Then, a few weeks later, we’re right back to where we started and it looks like Europe is about to collapse. Well, which is it? Seems to me that whenever things get really desperate in Europe, they come up with some new plan that will bail everybody out and things go back to abnormal around there. Up and down, crisis to crisis, yet nothing seems to change. And so long as they cling on to their bloated welfare states, nothing WILL change in Europe.
And what are we doing about it here? We’re literally printing more money through our Federal Reserve. I’m just surprised that inflation isn’t worse than it already is (at least for food and fuel). But the problem is, whoever the next president is over the next four years will get whacked by some horrible inflation as soon as the interest rates start to go back up. So what will we do then? Why, print more money, what else?
European stability? What European stability?
the Greek tragedy coming to a venue near you. the government will take care of you, until they decide you aren’t worth it. the government in Greece and Spain can’t take care of their people. you can’t tax the unemployed and they want to tax the money the government gives them. this sounds like a government ponzi scheme. Obama said you didn’t build that, well he certainly is building that. i don’t want to become a serf.
After daily doses of unrest, rioting, suicide-bomb-throwing Muslims here and there, Asian refugees here and there, a generalized refusal within Europe to admit that Socialism simply cannot work long term….we Americans must “move on”, or “look forward”, from the Europe and England of not too long ago and accept that they aren’t likely to recover any portion of their past creativity.
The Industrial Revolution has been replaced by the smokeless, infernal but here-to-stay computers.
A closer English Speaking Union now seems inevitable …..[Australia, New Zealand, Canada and the U.S.A. as a replacing "Commonwealth"] ……but what to do about the “England problem” will remain the poignant albatross. The Scots and Irish and Welsh have always been scrappy enough to look after themselves until being absorbed by England. That England is now submerged by Third World immigration….all the former Colonists want to come “home” to roost. Tragic irony compounded…..there ain’t no space in England.
That should tell all of us outside that Socialistic/Muslim penetrated turmoil that we who emmigrated from the British Isles were indeed the unwitting prescient ones of the 1600′s.
We must be careful to hold on to that development of ours.
Until the power goes off, and doesn’t come back on again.
The “microchip revolution” can’t survive without those “smokestack industries”, notably power plants, no matter how many sacrifices the Enlightened Ones offer up to Holy Mother Gaia, Holy Wind and Holy Sun. The problem is, they are either too stupid to understand this, to delusional to believe it, or just too fanatical about building their Utopia to care.
Rolling blackouts do not equal a “post-industrial” society, except in the sense of one looking a lot like a pre-industrial one. While the Utopians may consider that a Paradise, they’ve never actually had to live in it.
By comparison, a lot of people where I grew up had a pretty good idea what it was like, because they were farmers in the 1950s and 1960s. People like myself.
The difference, of course, was that we had handy things like electricity, tractors, herbicides, etc., to work with. All the things our “deep-ecos” despise while preaching the glories of the Wonderful World After We Get Rid Of All The Nasty Technology.
For a look at what that world will probably be like, check out Zimbabwe today.
Then start studying pre-Machine Age agriculture. Including the correct use of the ax. You’ll need it to build a log cabin with.
The choice isn’t between “smokestacks” and a computerized Golden Age.
It’s between reality and a new Dark Age.
clear ether
eon
That’s a superb dose of earthy reality…..”until the power goes out”….especially. We can’t eat those infernal computers, certainly.
My thoughts were more of a cloudy(!) metaphor.
eon,
You might like “The Last Centurion” by John Ringo. It’s written with a Hillary equivilent as POTUS but I can see 0bama making similar choices.
I keep a copy on the bookshelf nearest my desk. It’s handy when The One says something; I can check Ringo’s novel to determine whether or not it’s even stupider than the “stratageries” he attributes to the HillClone in the novel.
So far, The One in real life has made the HillClone in the novel look like Einstein by comparison. We’re just lucky we haven’t had a major biological crisis, as in the novel.
Yet.
cheers
eon
Ask yourself why the Euro started out at parity with the dollar at its inception, yet is now worth about $1.30. We have actually lost a lot more ground than they have. Inflation is a built in feature of our economy due to the Fed. We must elect Romney or it will be a real disaster. Atlas will shrug for sure.
Get ready to defend yourself from the looters. The white collar ones have already done their part to destroy America.
Upside Down Gold Trend and the Great Credit Contraction Commodities / Gold Silver 2009 May 08, 2009 By: David_Morgan
http://www.marketoracle.co.uk/Article10537.html
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