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Michael Gurstein on Sun, 26 Jul 2015 22:21:25 +0200 (CEST)


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<nettime> Fwd: ZNet Commentary: Joe Emersberger: Europe's Democratic Deficit


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   From: ZCommunications <michael.albert {AT} zmag.org>
   Date: Sat, Jul 25, 2015 at 3:08 PM
   Subject: ZNet Commentary: Joe Emersberger: Europe's Democratic Deficit


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   Joe Emersberger: Europe's Democratic Deficit

         Z Communications Daily Commentary

   A July 10 Yougov poll found very solid public support in Germany for
   the Merkel government's leading role in the destruction of the Greek
   economy.

   Only 9% of Germans blame the Troika - the European Union, European
   Central Bank (ECB) and IMF - for the state of the Greek economy. The
   level of ignorance is even worse in Sweden and Denmark. Only 6% and 4%
   in those countries, respectively, blame the Troika for the crisis in
   Greece.

   In Germany, 59% exclusively blame past and present Greek governments
   for the crisis. In Sweden and Denmark, 65% and 70%, respectively,
   exclusively blame Greek governments. These numbers are a grim reminder
   of how effectively the media undermines democracy.

   Consider how Der Spiegel, a German media outlet, summed things
   up for its readers:

   "Greece is little more than a failed state governed by clientelism and
   nepotism, a country whose economy has little to offer aside from olive
   oil and beach bars....That was true already five years ago when the
   government in Athens admitted to having taken on three times as much
   debt as previously disclosed, an admission that triggered the start of
   the euro crisis."

   Putting aside the condescension and near bigotry in the passage above,
   the "euro crisis" was actually triggered by a global recession that
   struck in 2009. It devastated countries like Spain which, unlike
   Greece, had been running budget surpluses and whose governments had
   not lied about their finances. Moreover, absolving Greece's creditors
   by saying they were successfully bamboozled until 2010 is outrageous.
   Lenders are supposed to identify fraud and bad investment risks. It's
   the socially useful function they supposedly perform.

   It gets worse for the story Der Spiegel sells its readers. Dangerous
   trade imbalances within the Eurozone - especially in Greece, Ireland
   and Spain - had been building for several years before the global
   recession. Dean Baker points out that the ECB was too incompetent to
   take action. Baker remarked that "Since it is apparently possible to
   take away the pensions that Greek people spent their life working for,
   some people may want to know if it's possible to take back the much
   higher pensions earned by top officials at the ECB."

   ECB officials need not worry provided they remain shielded by Der
   Spiegel and countless similar European outlets. Greek pensioners, on
   the other hand, have plenty to endure and worry about.

   Absolving creditors for what happened in Greece up to 2010 is
   ridiculous, but ignoring their overwhelming culpability for what has
   happened since then is on a whole other level of absurdity.

   According to Der Spiegel, "Much had improved before Tsipras took over
   the government, to the point that national revenues had finally
   exceeded spending. But the Tsipras government loosened up the austerity
   regime, unsettled the business sector and consumers with contradictory
   announcements, and refused to privatize state-run enterprises."

   The cynicism of this passage would have impressed Goebbels. It is best
   exposed by a single chart that Paul Krugman pointed out. You can
   literally draw a straight line between the amount of austerity (budget
   slashing) the Greek government has imposed over the past five years (as
   commanded by the Troika) and its brutal economic collapse. Greece's
   public debt and the cost of public pensions both increased
   dramatically relative to GDP as the economy shrunk. A slow recovery had
   just begun when Tsipras took office, but that recovery was supposed to
   happen years earlier according to the Troika. Quite simply, the
   Troika's orders were very closely followed and it led to a
   disaster comparable to the Great Depression. The polls I
   cited above show what a fine job the media in Europe has done to hide
   this simple truth from its audience, but there is more.

   The long overdue recovery in Greece was undone by the malevolence of
   the ECB, and not, as Der Spiegel claimed, by Tsipras who has only been
   in power several months and, it should not even need saying, could
   never operate with very much autonomy from his European overlords.

   As Mark Weisbrot explained,

   "Just 10 days after the election, the ECB cut off its main line of
   credit to Greek banks, even though there was no obvious reason to do
   so. Shortly thereafter, the ECB put a limit on how much Greek banks
   could lend to the government - a limit that the previous government did
   not have."

   When the Tsipras government called a July 5 referendum on the Troika's
   June 28 "offer" to Greece, the ECB ramped up its aggression and
   effectively forced the closure of Greek banks.

   Unlike people in Germany and Sweden, Greeks are living the gruesome
   consequences of the Troika's policies and could not be propagandized or
   intimidated into voting the way the Troika openly demanded.

   The Economist argued that "No one has suggested having a referendum
   in other countries about bailing out the Greeks, for the very good
   reason that they know what the answer will be."

   In other words, Europeans who have been completely misled about the
   Greek crisis, and who are shielded from its consequences, are willing
   endorse their governments' cruelty towards Greeks. German officials
   have openly boasted about how well protected its economy is against
   collapse in Greece - not an empty boast given the reality of the past
   several years. People who believe in democracy assume that it gives
   voters the most influence on decisions that impact them the most. That
   is why nobody would endorse the citizens of Athens electing the mayor
   of Berlin and contemptuously disregarding what Berliners think. Anyone
   who claims that Germany and its allies are acting with democratic
   legitimacy in Greece are endorsing that kind of nonsense.

   In the same article, the Economist also argued that German banks have
   not been bailed out by the Troika: "if only the banks were the
   creditors, the whole issue might be easier to deal with. Go back to the
   2012 deal; the private sector creditors (the banks) were made to take a
   50% write-off..."

   As Jerome Roos pointed out, the bailouts began in 2010, not 2012 as
   the Economist pretends, and even IMF economists stated that the 2010
   bailouts "only served to delay debt restructuring and allowed many
   private creditors to escape ... leaving taxpayers and the official
   sector on the hook".

   Decent people in Germany and elsewhere in Europe who want to hold the
   Troika accountable and alleviate suffering in Greece should not
   underestimate the uphill battle they face against the media at home.




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