The emerging role of Goldman Sachs in the new technocracy confirms trends that have been taking place over many years.    [Ind]

The difference is that scant attempt is now made to hide the trends by obfuscatory techniques, such as the third face of power.

The pretence that democracy was alive and well - and that elections mattered - was blown sky high by the conduct of the three main UK parties during the 2010 election, when fantasy promises dominated the campaign until - in the final days - The Institute for Fiscal Studies blew the whistle on the lack of discussion of the deficit.    [Gdn]

The responses of the Euro 'élite' to the systemic problems posed by the fact that their currency project lacked a single treasury, and a lender-of-last-resort, demonstrates the triumph of political theory over economic reality.

For the euro was always the pursuit of Napoleonic ends by economic means. Democratic is isn't, and never was.

At the heart of the EU's democratic deficit lies the fact that it hovers uneasily between a confederation of sovereign states and its possibility as true federation on something like the US model.

In parallel, the absence of democratic institutions - a legislative check on the Brussels executive - has meant the lack of any channel whereby the people of Europe could be incorporated into the debate as to its future, and, by the same token, the lack of understanding on the part of the élite as to the imperative to take people with them on the journey to a federal state.

The problems posed by power, and its constant tendency to corrupt - as fully understood by that great generation that devised the US Constitution - figured not in the plans of those driving the project in the fifties, sixties and seventies.

Worse was to follow.

As neoliberalism rose to became the only show in town during the seventies and eighties, the Christian/Social democratic traditions of continental Europe were subverted, leading to that cynical nostrum: 'communitarian citizenship', as embeded in the Lisbon Treaty.

Corporate Technocracy in the UK

Communitarian citizenship - aka David Cameron's 'big society' - envisages voluntary groups taking over the role of the social state in providing welfare, and support networks such as private/voluntary versions of services like Sure Start.

The fact that a working population confronted with both neoliberal precarity in the workplace - and the downwards pressure on wages posed by inward migration and the reserve army - might not have the resources to run such networks, is beyond the understanding of ex-members of the Bullingdon Club (and their fellow neoliberals on the continent).

The non-working population might be considered as a source of 'volunteers' to run 'communitarian' networks, and this may indeed happen.

However, the accent currently is on getting the younger unemployed to 'volunteer' for workfare with firms like Poundland.
[Gdn]

That such firms might come to realise that they could sack paid workers, and get them back for free from the jobcentre, has either not occurred to the likes of Iain Duncan Smith, or this could be a route to circumventing the Minimum Wage.
[Gdn]

Angela Merkel's Three Goals

To Frau Merkel there are three goals: the survival of the eurozone; the survival of Germany's hegemony within it; and the imperative to subject the PIIGS nations to the necessary austerity to prevent the eurozone becoming a transfer union.

In short, Angela Merkel is not communitaire - a charge usually levelled against Britain, btw - and has become the roadblock to further integration.

The fact that Greece and Italy are now governed by unelected appointees - with connections to Goldman Sachs - is unimportant to Mrs M, as is the alleged discovery of a copy of the Irish government's forthcoming budget in the Bundestag, giving rise to the implication that the government of Ireland has to run its financial proposals past the German government before they go to the Dail.
[Gdn]

Presumably there are further 'technocrats' from Goldman Sachs waiting in the wings to take over in Madrid, Lisbon, and Dublin should the current governments get the sort of ideas which sunk the ex-Greek PM who planned - shock, horror - to hold a referendum. [1]

The corporate technocracy cannot be subject to the vagaries of the vote.

Governmentality and the Autonomous Chooser

While the West floated along on the fantasy world of 'no more boom and bust' it was possible to believe that democracy and the markets could rub along together, despite the events in Chile after 9/11/73.

But the credit crunch, followed by the euro crisis, has exposed the illusion.

Having been elevated to their currently unassailable position, the markets can no longer co-exist with the fiction that elections offer the pawns a sense of agency which is at variance with the demands of the markets.

Governments - like Italy - which cannot deliver a market-ready populace via the 'third face of power', will have to move over for the technocrats, who will use more direct means, as yet to be seen in both Italy and Greece.

Previously, the neoliberal players relied on elected government to deliver such a populace via the techniques of governmentality, in which the individual becomes what Patrick Fitzimmons calls an 'autonomous chooser' in which ...

... every human being is an entrepreneur managing their own life ...

In terms of moral philosophy this is a “virtue ethic”, in which human beings are supposed to act in a particular way according to the ideal of the entrepreneur.

Individuals who choose their friends, hobbies, sports, and partners, to maximise their status with future employers, are ethically neoliberal.

This attitude is unknown in any pre-existing moral philosophy, and is also not part of early liberalism.

Such actions are not necessarily monetarised: they represent an extension of the market principle into non-economic area of life, again typical for neoliberalism.

Neoliberalism is a philosophy in which the existence and operation of a market are valued in themselves, separately from any previous relationship with the production of goods and services, and without any attempt to justify them in terms of their effect on the production of goods and services; and where the operation of a market or market-like structure is seen as an ethic in itself, capable of acting as a guide for all human action, and substituting for all previously existing ethical beliefs.

The idea that everyone should be an entrepreneur is distinctly neoliberal.

For neoliberals it is not sufficient that there is a market: there must be nothing which is not market.
(My italics - Tom)    Radical Pedagogy

Augusto Pinochet demonstrated his awareness of the size of the task when he said that it was his aim to ...

" ... make Chile not a nation of proletarians, but a nation of entrepreneurs ... "

[Wiki]

By that yardstick, Cameron and Osborne are themselves a couple of novices quite unfit to carry out the task.

Britain has yet to experience real technocracy, or what Naomi Klein calls The Shock Doctrine.

The Heritage Foundation's Index of Economic Freedom indicates how far a nation has gone towards realising the goals of the free markets.

In 2011, Britain ranked 16th.

Eurozone ministers back 130bn-euro bailout for Greece

It's a bailout for bankers, it's a bailout for German exports ...

Greece is to receive loans worth more than 130bn euros (£110bn; $170bn).

In return, Greece will undertake to reduce its debts to 120.5% of its GDP by 2020 and accept an "enhanced and permanent" presence of EU monitors to oversee economic management ...

Analysis
Gavin Hewitt
BBC Europe editor
--------------------------------------------------------------------------------
Among European officials and ministers, there is a huge sigh of relief. The country that has been at the heart of the eurozone's debt crisis has, for the moment, been taken off the critical list.

But it comes at a price. Permanent monitors from the EU, the IMF and the ECB will be placed on the ground in Athens to ensure there is no back-sliding. It is a humiliating and unprecedented intrusion into Greece's sovereignty.

To the question of whether growth will return to this battered economy, there is a shaking of heads. Perhaps in a decade, I am told. The risk is that the new cuts will only deepen an existing recession.

And the question remains: is Greece's future secure, or has this deal just bought time for the eurozone to build greater protection around its banks and around potentially vulnerable countries like Spain and Italy?

BBC NEWS  21 Feb 2012    Global Risks    IMF    Pawns or Players?    The Merkozy Plan

EU Should Admit Greece is Bankrupt

German economy: Optimism amidst the slowdown

A Financial Coup d'etat ...

EU Should Admit Greece is Bankrupt

This commentary has a clear and simple message: The second Greek bailout of €130 billion ($172 billion) that euro zone finance ministers are expected to agree on Monday afternoon should not be paid out ...

The mistake isn't the size, but the construction of the bailout package.

It isn't geared to the requirements of the people of Greece but to the needs of the international financial markets, meaning the banks ...

In truth, Greece has of course been bankrupt for a long time. The country doesn't need debt forgiveness of 70 percent, it needs a 100 percent debt cut if it is ever to recover ...

If the European politicians have a shred of faith in all the work they've done in the two years since the breakout of the euro crisis, they should now admit what everyone already knows: Greece is bankrupt and all the country's debts should be forgiven.

Greece should nevertheless get the €130 billion. But the money should be paid in another form.

Instead of rewarding financial speculators for their high-risk deals, the money should flow into the reconstruction of the Greek economy.

A new Marshall Plan is needed, rather than a manic insistence on debt repayments.

Der Spiegel  20 Feb 2012    The Merkozy Plan

Germany Has Been the Winner ...

'Restructuring Greece Within the Euro is Illusory'

Germany's smear campaign against Greece

Michael Theodorou, head of the Evangelismos public hospital in Athens, told me that his budget had fallen from €149m in 2009 to €112m last year, even though the number of patients had risen from 82,000 to 99,700, due to the reliance of the newly pauperised middle class on public health as they lose their private insurance.

This was achieved by slashing drug costs – switching to generics – and cutting the salary of nurses to the bone ...

The single greatest cause of the missed budget targets is the collapse of the Greek economy. GDP contracted 6.8pc last year, accelerating to a 7pc rate in the last quarter.

That is the main reason why tax revenues have fallen off a cliff.

The Greek Labour Institute ... expects the economy to contract by another 7pc this year. This will take the combined slump to 22pc.

Debt is compounding exponentially on a shrinking base.

I notice that failure to meet the privatisation schedule of €5bn by the end of 2011 and €50bn by 2015 is widely cited as an egregious case of Greek foot-dragging ... how on earth is Costas Mitropoulos from the Hellenic Republic Assets Development Fund supposed to attract buyers until the threat of Greek default and euro exit – or "Grexit", in the jargon – is taken off the table? ...

Tel  16 Feb 2012    The Merkozy Plan    Third Meltdown Log

Greece can slay its financial demons – but will it spare the euro?

Portugal’s Debt Efforts May Be Warning for Greece

Unlike Greece, Portugal is a debtor nation that has done everything that the European Union and the International Monetary Fund have asked it to, in exchange for the 78 billion euro (about $103 billion) bailout Lisbon received last May.

And yet, by the broadest measure of a country’s ability to repay its debts, Portugal is going deeper into the hole.

The ratio of Portugal’s debt to its overall economy, or gross domestic product, was 107 percent when it received the bailout.

But the ratio has grown since then, and by next year is expected to reach 118 percent.

That’s not necessarily because Portugal’s overall debt is growing, but because its economy is shrinking.

And economists say the same vicious circle could be taking hold elsewhere in Europe ...

NYT  14 Feb 2012    The Merkozy Plan

EU: Social or social Darwinist?

'New Poor' Grows from Greek Middle Class

Athens has always had a problem with homelessness, like any other major city.

But the financial and debt crises have led poverty to slowly but surely grow out of control here.

In 2011, there were 20 percent more registered homeless people than the year before. Depending on the season, that number can be as high as 25,000.

The soup kitchens in Athens are complaining of record demand, with 15 percent more people in need of free meals ...

Der Spiegel  14 Feb 2012    The Merkozy Plan    Third Meltdown Log

EU: Social or social Darwinist?

Moody's Delivers Damning Verdict on Euro Zone

Greece passes crucial bailout vote as country burns

Goldman Sachs 99 - 1 Greek People

The 199-74 vote was passed amid some of the most serious violence seen on the streets Athens and spread to other Greek towns and cities, including the holiday islands of Corfu and Crete.

More than 45,000 protesters, many facing steep cuts in pensions, wages and a bigger fall in living standards besieged the Greek Parliament in two demonstrations.

A minority were met with tear gas by the 4,000 policemen after throwing fire bombs.

The controversial loan and austerity package sets out €3.3bn in wage, pension and job cuts for this year alone, adding to the pain of years of recession ... lower wages and high unemployment ...

Tel  13 Feb 2012    Global Risks 2012    The Merkozy Plan    Third Meltdown Log

Brussels welcomes austerity vote

'Merkel Is Leading Europe in the Wrong Direction'

European Doubts Growing ...

As Greece stares into the abyss, Europe must choose

As Greece stares into the abyss, Europe must choose

Europe's problem summed up in 68 words ...

... what's really at stake here is not Greece's identity but Europe's.

All eyes are fixed on Athens, but the way out of the crisis requires a choice about what kind of Europe we want.

The one we have now, with its deep structural inequalities and its rigid adherence to a failed economic ideology, protects neither democracy nor human rights.

Stiff-necked and punitive, it prefers to eat its children.

Gdn  12 Feb 2012    EU: Social or Social Darwinist    The Merkozy Plan

Merkel has herself to blame if Greece defaults

Contingency plans for a return to the Drachma have been drawn up in Athens, Berlin and Brussels ...

In a note last week, Willem Buiter, Citigroup’s chief economist, said: "In early September 2011, we argued that the cost of Greek exit to the rest of the world would be very high.

We now consider these costs to be much lower because the 'exit-fear-contagion’ could be contained."

Instead, rescuing Greece look far more risky. The IMF believes Athens could need a further €250bn of support over the next 10 years.

And the prize, beyond eurozone integrity, is just 2.5pc of the area’s economy.

Weighed up, surely Merkel wouldn’t mind the Greek exit so much after all. The German taxpayers might even reach for the ouzo.

For Greece, there’s little to hope for from today, which ever way it goes. The austerity package looks tough: 20pc reduction in the minimum wage; 15,000 public sector jobs losses; pension and spending cuts.

But it’s probably irrelevant anyway. While Merkel and other leaders have focused obsessively on numbers, forcing Greece to reduce its debts and repay Brussels for its folly, they appear to have missed the country’s alarming economic, political and social collapse.

On Thursday, the Hellenic Statistical Authority said Greece’s manufacturing output contracted by 15.5pc in December from a year earlier and industrial output fell 11.3pc, having fallen 7.8pc in November.

Unemployment jumped to 20.9pc in November, up from 18.2pc in October - a rise of 14pc in a month ...

Tel  11 Feb 2012    The Merkozy Plan

Greece now needs €145bn bailout to avoid collapse

Greece

'Without a New Beginning, Athens Is Lost'

The center-right Frankfurter Allgemeine Zeitung writes:

" ... Greece presents a desolate picture, in terms of its economic structures, competitiveness, social cohesion and political system.

"In other parts of the world, it would be called a failed state. It is time that the Europeans admit that fact and take the necessary action ...

"It must be ended quickly."

The Financial Times Deutschland writes:

"Greece is currently trying to do something impossible: which is to reform the economy in the midst of a deep depression. That simply doesn't work." ...

The center-left Süddeutsche Zeitung writes:

" ... if the country can't be saved by turning the thumb-screws, then what?

Then the only alternative is radical debt relief on the part of the major private creditors, the banks and the hedge funds.

The European Central Bank would probably also have to write down some of its holdings of Greek debt.

Then, Greece would need a Marshall Plan on top of that. All of this is expensive, and progress will not happen overnight.

But there are no longer any real alternatives." ...

The financial daily Handelsblatt writes:

" ... The only way to 'save' Greece is through an orderly national default.

Without such a new beginning and a long-term strategy for growth, Athens is lost."

Der Spiegel  10 Feb 2012

European Union Keeps Pressure on Athens

Economists have long pointed out that Greece cannot solve its vast problems through austerity alone.

Rather, the government must finally address the sources of its debt problem -- such as its enormous current account deficit of 9 percent.

That, though, can only be solved by way of a massive investment program and the resuscitation of Greek industry ...

Der Spiegel 

Is Portugal Next?

The European Union passed a €78 billion bailout package for Portugal last May to help the country stay afloat until it could return to the international financial markets by the end of 2013.

That deadline, though, has looked increasingly untenable in recent weeks as yields on 10-year Portuguese sovereign bonds exploded to over 17 percent in January before falling back to their current levels of around 13.5 percent.

Anything over 7 percent is considered to be unsustainable in the long term ...

Der Spiegel     The Merkozy Plan

Alternatives to Borrowing    Contesting Neoliberalism

Greece Puts Off Decision on Austerity Moves ...

Someone's forgotten the lessons of the 1930s, haven't they Mrs M?

With Athens shut out of the private lending markets, Greece’s so-called troika of official creditors — the European Commission, European Central Bank and International Monetary Fund — have repeatedly criticized the government for failing to make structural changes in its economy.

But their plan of tax increases, spending cuts and now wage cuts has not only helped push the country into a deep recession, but has also stripped Greece’s political center, weak to begin with, of its last shreds of political legitimacy.

With unemployment at 19 percent, businesses closing, credit scarce and the proposed new wage cuts expected to further decimate the shrinking middle class, the hard left and extreme right are rising ...

NYT  08 Feb 2012    The Merkozy Plan

Greeks Reach Deal on Austerity

Greece: 'There's no more left to cut'

'The Greatest Danger to Merkel Bears the Name Hollande'

I suppose if you expect Germany to bail you out, you cannot complain if they demand a say in who you elect as leader.

Perhaps it's time for Brussels to run a 'Goldman Sachs' candidate in every euro state's elections?

Following Chancellor Angela Merkel's controversial pledge to back fellow conservative French President Nicolas Sarkozy on the campaign trail ahead of elections there this spring, Germany's opposition Social Democrats have said they will throw their support behind ... Socialist Francois Hollande ...

Jürgen Trittin, parliamentary floor leader for the Green Party, said that Merkel campaigning on behalf of Sarkozy could "damage German-French ties," ...

Sigmar Gabriel, head of the center-left SPD, called Merkel's move "rather embarrassing."

The comments came on the heels of a joint television interview given by Merkel and Sarkozy in the Élysée Palace in Paris on Monday afternoon ...

Merkel ... dodged questions about her demurral regarding a proposed Berlin visit by Hollande. "We haven't decided yet," she said ..

Merkel is concerned that, should Hollande take over the reins in Paris, her efforts thus far to stabilize the euro could be endangered.

He has said he is in favor of introducing euro bonds, which Merkel is adamantly opposed to, and would like to renegotiate the recently signed fiscal pact, a central pillar of Merkel's approach to solving Europe's debt crisis.

Hollande's substantial lead in the public opinion polls over Sarkozy has allowed him to be philosophical about Merkel's support for his rival.

"The fact that Nicolas Sarkozy needs Ms. Merkel says a lot about his situation," Hollande said during a Monday campaign appearance in Dijon.

"That's some task she's taken on." ...

Der Spiegel  07 Feb 2012

Why Germany Isn't Benefiting from Euro's Woes

"Germany is currently living at the expense of the other euro-zone countries," says Theodor Weimer, head of the board of the HypoVereinsbank bank.

According to calculations performed by the Cologne Institute for Economic Research (IW) ... the low bond rates will translate into savings of €45 billion ($59 billion) in the medium term for the German Finance Ministry.

As a result, the German government is under growing pressure to contribute even more money to efforts to rescue the euro ...

This supposedly logical argument is currently widespread throughout Europe. But there is just one problem: It's a myth.

Any examination of how the euro crisis affects German government finances quickly reveals that the costs far outweigh the benefits ...

The countries in the monetary union have already lent insolvent Greece more than €50 billion, with the largest share -- €15 billion -- of these bilateral loans coming from Germany ...

"If Germany ultimately emerges from the crisis in the black," says euro expert Clemens Fuest, "it would be a great miracle."

Der Spiegel  07 Feb 2012    The Merkozy Plan

EU summit edges towards new eurozone treaty

The prospect of 'President' Hollande casts a shadow over Mrs Merkel's plans

The view in Brussels and other EU capitals is that Merkel needs the new euro regime to demonstrate to German public opinion and parliament in Berlin that the rest of the eurozone has adopted sound and strict rules before she can sanction increased aid for Greece.

She is also keen to get the new system established before the decisive round of the French presidential elections in May since the leftwing frontrunner, François Hollande, has pledged to renegotiate the pact while outlining public spending plans that could put France in breach of the new rules.

Victory for Hollande could yet upset the calculations in Berlin since France is unlikely to ratify the new deal in the National Assembly before the presidential contest is settled.

Gdn  30 Jan 2012 Gdn  30 Jan 2012

The eurozone: Another step

Locked into decline?

The new pact should be signed in March although there may be arguments in countries like Ireland over whether the people should get to vote on what is a significant step towards a fiscal union.

Much energy and argument has been spent on this agreement. It is questionable, however, whether it will have much influence on the immediate crisis.

Sony Kapoor of the Re-Define think tank says that "to the extent the fiscal compact may help increase support for tackling the euro-crisis amongst Germans and at the ECB, it may serve a useful role. In actual economic terms, it is largely irrelevant" ...

One final thought on the new fiscal pact.

There is an irony here: it enforces restrictions on spending just when the EU is beginning to question whether austerity risks tipping countries into a spiral of decline.

Growth is the new watchword.

Leaders like Mario Monti are challenging the German orthodoxy but, in the future, countries that are tempted to borrow more will have their hands tied ...

BBC NEWS  31 Jan 2012

This was not the crisis summit... the worst is yet to come

The reality is that this new pan-European architecture falls well short of the sort of fiscal union that markets want to see.

It promises to be a system of fiscal rules, without the promise of money transfers to struggling states to help them deliver on their commitments.

It is all stick and no carrot – and thus lacks credibility ...

Ind  31 Jan 2012

Feeling more positive about the eurozone crisis? Don't

Maybe, once the French election is out of the way, the German treasury will back cheaper interest rates for indebted countries through eurobonds.

Maybe higher fiscal transfers will be forthcoming, which will add up to bigger debt write-offs.

But the magnitude of the debt write-offs needed for Ireland and Portugal, as well as Greece, have yet to be factored into the euro equation.

Gdn  30 Jan 2012    Global Risks    The Merkozy Plan

For Greek Tax Reformers, Good Ideas Aren’t Enough

Europe May Be Planning 1.5 Trillion Euro Backstop Fund

EU Summit Marred by Fears of German Domination

European Politicians in Denial as Greece Unravels

Germany wins battle on tighter fiscal rules

Greek shoppers look but don't buy

Miles to go before the Euro Crisis is resolved!

European Financial Stabilisation Mechanism

Germans want EU budget commisioner for Greece

Perhaps the Bundeswehr might also patrol the streets to prevent any more riots, Mrs M?

The Financial Times, which has a copy of the plan, calls it an "extraordinary extension" of EU control.

Greek Education Minister Anna Diamantopoulou called the German plan "the product of a sick imagination".

The European Commission said the budget "must remain the full responsibility of the Greek government".

A German official told the Associated Press eurozone finance ministers were discussing the plan ...

Under the German proposal, a budget commissioner would have veto powers over Greek budgetary measures if they were not in line with targets set by international lenders ...

BBC NEWS  28 Jan 2012    The Merkozy Plan

IMF pushes Greece over budget

Greeks reject German plan for EU budget commissioner

Bank Bondholders to Be Paid While Irish Public Howls

The European Central Bank put Ireland on notice last week that defaulting on payments to the bondholders could lead to dire financial consequences, the equivalent of a financial “bomb” in the Irish economy ...

But that has not quelled a public debate about whether taxpayers should pay bondholders who bet on investments in a bank that was bailed out and nationalized in 2009 after the collapse of the Irish real estate market.

In general, unsecured bondholders reap a higher return because the bonds are not guaranteed and therefore carry a higher risk.

The critics — among them labor unions, opposition parties and a newly formed coalition of social justice groups — are incensed that the corporation is about to pay out more than 1.25 billion euros on Wednesday and then a promissory note payment of 3.1 billion euros in March ...

Repayment is a divisive issue because Irish taxpayers face years of austerity to pay for the bailout of Anglo Irish and other Irish banks.

Measures include budget cuts like the elimination of hundreds of nursing home beds, teacher layoffs and the closing of rural post offices and police stations.

Ireland’s current government rose to power with pledges to impose losses on bondholders in Irish banks, but it changed course under pressure from the European Central Bank to pay off the bonds ...

NYT  24 Jan 2012    Bankocracy Log    The Merkozy Plan

Financial Terrorism

Greek rescue blocked by hedge fund greed

... fears have grown in recent weeks that the hedge funds that are blocking the deal – which have been identified as including Vega Asset Management, Och Ziff, York Capital, GreyLock Asset Management and Marathon Asset Management – do not consider the prospect of a disorderly default by Athens as a financial incentive to allow a voluntary writedown deal to proceed.

This is because these funds are believed to have purchased insurance policies on their holdings of Greek bonds, known as Credit Default Swaps (CDS).

If Athens fails to pay its maturing debts in March, that would trigger large CDS payouts to these funds from the large financial firms that sold them the insurance ...

However, a hedge fund source denied that the behaviour of small investment funds was frustrating a voluntary deal – and possibly even forcing a default – arguing that the voluntary basis of the restructuring deal being pushed by the IIF and European leaders was "crony banking".

"Who will lose out if the insurance is paid out?" he said.

"The two biggest issuers are Goldman Sachs and AIG. They are effectively being given a bailout by not allowing Greek debt to default.

"Seven Goldman Sachs ex-employees are in European Union governments. This is crony banking at its worst." ...

Ind  18 Jan 2012    Bankocracy Log    'Doing God's Work'    The Merkozy Plan

Goldman Sachs enters £8bn 'parallel pay universe'

Angela Merkel has the whip hand in an orgy of austerity

The notion that economic pain is the only route to pleasure was once the preserve of the British public school-educated elite, now it's European economic policy

The language of S&M is also now part of the eurozone discourse.

The joint letter sent last month by Sarkozy and Angela Merkel to Herman van Rompuy, president of the European Council, explaining the Franco-German plans for future governance of the single currency stressed "fiscal discipline" and the need to "detect and correct departures from sound economic and fiscal policies long before they become a threat to the stability of the euro area as a whole" ...

Spain is perhaps the best current example of the predilection for pain.

The new conservative government of Mariano Rajoy has inherited a budget deficit running at 8.7% of GDP in the first nine months of 2011 and has set a target of reducing it to 4.4% of GDP in 2012 and 3% in 2013.

This involves taking €40bn (£33bn) out of the economy this year by a combination of tax hikes and spending cuts ...

Yet as Jamie Dannhauser of Lombard Street Research notes, Spain's real problem is the overhang of private sector debt from the housing bubble, which has left the banks in a precarious state.

To the extent that there are concerns about the solvency of the state, they are due to fears that lenders will go belly-up leaving Madrid to pick up the pieces.

Spain is uncompetitive internationally and has a dysfunctional labour market, but compared to Greece, Italy and Portugal it has a relatively low level of public debt ...

Gdn  08 Jan 2012    A Two Speed Europe

A Faustian Pact    The Merkozy Plan

This emergency plan is great news - if you're a bank

If you're a eurozone bank that finds itself a few euros short, you can now go to the European Central Bank and tap a ready supply of cash at an attractive rate.

That's how Mario Draghi's emergency measures will work: banks can access funds for three years and can do so by offering collateral of lower quality than ever ...

If, on the other hand, you're a eurozone government short of a few cheap euros, don't look to the ECB ...

The problem is that the ECB is not allowed by its constitution to buy sovereign debt ...

Them's the rules. And Draghi is sticking to them ...

Gdn  08 Dec 2011    Euro Crisis    

Faustian Pact 3 - Saving the Euro

European Banks Need 115 Billion Euros

Euro Crisis

Five problems with Merkel and Sarkozy's plan to save the euro

... Merkel and Sarkozy left so many loose threads.

... their plan seems to rely on the European Central Bank swallowing its scruples and announcing that it is prepared, in effect, to finance Italy and Spain if necessary.

That is because Merkel and Sarkozy have really presented a scheme to prevent a repetition of the crisis ...

... greater fiscal discipline won't achieve much if the eurozone slips into deep recession.

In that case, deficits would increase.

Merkel and Sarkozy mentioned growth in their five-point plan but there was no detail on how it would be generated.

Is Germany prepared to crank up its spending in order to ease the burden on the rest of Europe? ...

... Merkel and Sarkozy said nothing about recapitalising eurozone banks.

Only a few weeks ago the IMF was saying €200bn (£171.5bn) was required to counter the threat to financial stability.

Will recapitalisations be ordered or not? ...

mull
7 December 2011 8:56AM

You missed the 6th point (or indeed what should be no 1) - there is no plan to adjust for the 30% competitiveness differential between north and south. Without that fiscal rules will simply lead to deflation and ultimate destruction of the euro anyway. Unless Germany will accept inflation as well as ecb bond purchases that is.

Gdn  06 Dec 2011    Euro Crisis    Global Risks 2012

'We feel your pain'

Eurozone states will need an act of union to save the single currency

Reform the euro or bin it

Changes do not take banking errors into account

Ben Chu
Economics Editor

The big day was supposed to be Friday.

But the euro-zone's Big Two seem to have decided that the Brussels meeting at the end of the week will be nothing more than a rubber-stamping exercise.

Angela Merkel and Nicolas Sarkozy announced yesterday that they had reached an agreement on how to stabilise the eurozone.

It would seem that the job for the rest of Europe's leaders is simply to turn up and approve it.

The deal seems to bear a deeper German, rather than French stamp.

There will be treaty change for the 17 nations of the eurozone and a new regime to limit borrowing by member states-both central demands of Ms Merkel's.

There will be automatic fines for fiscally lax states and the European Court of Justice will verify national budgets.

But there remains doubt about the extent to which the fiscal enforcement regime will be beefed up.

The European Court will not, we were told yesterday, be able to veto budgets.

Yet there is an absurdity about this whole exercise.

This is not a crisis driven by over-borrowing by states.

Yes, the former Greek government spent too much and deceived its eurozone partners about its finances.

But the governments of Ireland and Spain were running budget surpluses right up to the moment the roof fell in on them in 2008.

It was the banking sectors of those countries - facilitated by profligate financial institutions in France and Germany - that were out of control and effectively destroyed their public finances.

Ms Merkel's treaty changes will not address that fundamental flaw - and they will not help to alleviate the present crisis.

As such, the German Chancellor is engaged in elaborate displacement activity.

i  06 Dec 2011    Bankocracy Log    Euro Crisis    Global Risks 2012

EU treaty reform: what does it mean?

Does this amount to fiscal union?

Hardly. A full fiscal union implies a central finance ministry, harmonised tax-and-spend policies, mutualisation of debts via eurobonds to pool risks, and, ultimately, a mutualisation of savings via a transfer of funds from stable to vulnerable, rich to poor, north to south ...

Gdn  05 Dec 2011

Merkel and Sarkozy demand tough new eurozone treaty

The main points of the new treaty include:

• Automatic sanctions for breaching deficit ceilings of 3pc of GDP and a requirement for balanced budgets.

• Speeding up implementation of the permanent bailout funds, the European Stability Mechanism, to 2012, with the introduction of qualified majority - 85pc - for decisions, instead of unanimity.

• No more haircuts for bondholders.

• A monthly meeting of eurozone leaders until crisis ends, focusing on growth in Europe.

• ECB's role to remain unchanged - will not be lender of last resort - and there will be no eurobonds ...

Tel  05 Dec 2011

Debt crisis: all 17 eurozone countries face losing AAA credit status

... S+P has told eurozone countries including Germany, France, the Netherlands, Austria, Finland, and Luxembourg that they could be downgraded because of the failure of leaders to resolve the debt crisis.

The “lack of progress the European policy-makers have so far made in controlling the spread of the financial crisis may reflect structural weaknesses in the decision-making process within the eurozone and European Union,” the agency is said to have told them ...

Tel  05 Dec 2011    Euro Crisis    Global Risks 2012

Ireland, Italy and Greece face more cuts and tax rises

Germany and France agree rescue package

Merkel and Sarkozy close to agreement ...

Merkel and Sarkoz are clinging to a confederation ...

Europe – and especially the 17 single-currency members – has exhausted all avenues for major assistance in the wider world ...

Knowing that good money cannot continue to follow bad down various national drains, Ms Merkel has advanced a plan for containing Europe's crisis, calling for tougher rules to keep national budgets under control ...

In practice, this would mean that countries violating their commitment to keep deficits below 3 per cent of national income and government debt under 60 per cent of GDP would be sent to the European Court of Justice.

Quite what sanction the courts could impose, and quite what timescale is envisaged for compliance, is not yet known ...

Certainly relying on governments to play by the rules without the threat of sanctions has not worked.

The eurozone's current budget rules have been violated 60 times over the past decade by a number of nations – including Germany – but no country has been seriously punished ...

Ind  04 Dec 2011    Euro Crisis

Europe’s Transition From Social Democracy to Oligarchy

The ECB is demanding that it sell off public assets – land, water and sewer systems, ports and other assets in the public domain, and also cut back pensions and other payments to its population.

The “bottom 99%” understandably are angry to be informed that the wealthiest layer of the population is largely responsible for the budget shortfall by stashing away a reported €45 billion of funds stashed away in Swiss banks alone.

The idea of normal wage-earners being obliged to forfeit their pensions to pay for tax evaders – and for the general un-taxing of wealth since the regime of the colonels – makes most people understandably angry.

For the ECB, EU and IMF “troika” to say that whatever the wealthy take, steal or evade paying must be made up by the population at large is not a politically neutral position.

It comes down hard on the side of wealth that has been unfairly taken.

A democratic tax policy would reinstate progressive taxation on income and property, and would enforce its collection – with penalties for evasion.

Ever since the 19th century, democratic reformers have sought to free economies from waste, corruption and “unearned income.”

But the ECB “troika” is imposing a regressive tax – one that can be imposed only by turning government policy-making over to a set of unelected “technocrats.” ...

NEP  03 Dec 2011    EU: Social or Social Darwinist?    

The eurozone crisis: we need more than prayers now

Mr Cameron is facing overwhelming behind the scenes pressure from President Obama ... and his Treasury Secretary Timothy Geithner to throw Britain’s weight behind the rescue package being hammered together by France and Germany ...

At home, Sir Mervyn King, the Bank of England’s governor, is reinforcing this presidential edict.

Sir Mervyn has warned that the euro collapse could plunge Britain (and much of the world) into a bigger depression than we suffered in the 1930s ...

... yesterday’s meeting between Mr Cameron and Mr Sarkozy could not have been more fraught with consequence ... underlying their discussion, one great question hung in the air. Would Britain smile on France and Germany entering into what Brussels officials are calling a "Grand Bargain" to save the euro?

European voters were given a glimpse of how such (a "Grand Bargain") would work two weeks ago when Enda Kenny, the Irish Taoiseach, visited Berlin.

Only then was it discovered that members of the Bundestag were already studying details of the Irish national budget, which is not due to be announced till next month and had certainly not been shown to Irish legislators ...

... the truth is brutally clear. The Germans are insisting on this kind of detailed, advance oversight as a precondition of keeping their side of next week’s Grand Bargain – which requires them to throw the weight of German finances behind the battle to save the euro ...

Tel  02 Dec 2011    Euro crisis

Europe: Social or Social Darwinist?

Eurozone crisis ... is time running out?

How to Forge a Common European Identity

Europe's tragedy is that had the need to nurture this process - as a precursor to economic union - (a) been recognised, and (b) been given the time necessary to bear fruit, then it's possible the current crisis would never have arisen.

But real democracy was never on offer, instead the intergovernmental model invited politicians of all countries to see themselves as somehow remote from peoples steeped in irredeemable nationalism which had to be ignored rather than confronted.

In the case of Britain this was particularly important, because the perceived 'special relationship' with the US offered the UK a way of avoiding confrontation with the country's decline to a middle-ranking power during the course of WW II. (The Attlee government's ludicrous - and expensive - 'independent' nuclear deterrent being the best example of this illusion.)

One thing is certain: it's a bit late for fans of a united Europe to be putting the horse back infront of the cart.

The Green politician [Daniel Cohn-Bendit] envisions a united Europe organized roughly along the lines of the Federal Republic of Germany: with a government in Brussels, the European Commission, whose members are elected by the European Parliament.

The European Council in Brussels would serve as a second governing body next to the parliament, and it would also be involved in writing legislation for Europe.

A united Europe's foreign and defense policy, as well as its financial policy and large parts of its economic policy, would be managed in Brussels.

That's what a United States of Europe could look like.

Politicians of widely differing stripes, in Brussels and in many member states, including Germany, hold similar views ...

Der Spiegel  02 Dec 2011    Europe: Social or Social Darwinist?    Euro crisis

Merkel Is Leading the Country into Isolation

Eurozone crisis ... is time running out?

Euro Crisis

Angela Merkel takes action to stop euro collapse

A course of "action" which will take months if not years!

Angela Merkel demanded tougher control over the tax-and-spend policies of Germany's single-currency partners at the start of a make-or-break five days for the euro.

Seeking to halt the single currency's drift towards collapse, the German chancellor finally took decisive action to calm the financial markets when she said it was time to stop talking about a fiscal union and start creating one. Merkel said, however, that negotiations to secure greater centralised control over the budgets of the 17 members of the eurozone could not be rushed and would involve a risky renegotiation of the Lisbon treaty

Gdn  02 Dec 2011    Euro Crisis

Social or Social Darwinist?

Eurozone crisis ... is time running out?

A Crisis you cannot fix, Frau Merkel

Frau Merkel seems to want to maintain the present intergovernmental system of governing the eurozone, with the proviso that France and Germany are in control.

Given the huge disparities between the eurozone's economies, and the understandable belief that the PIIGS counties should put their own houses in order, she is demanding the impossible.

There are two options here: weaker countries - or stronger countries - demerge from the euro, or the eurozone becomes a fiscal - transfer - union, like the USA, with a proper central bank, rather than the current - inflation-only remit - ECB.

Merkel seems to want the current system, beefed-up with countries like Greece being hauled in front of the European Court.

The court will, presumably, levy fines which countries like Greece will not be able to pay, or it will take over the government of the country concerned via the new 'technocrat-from-Brussels' system.

This would not be a fiscal union.

Crisis 'will take years to fix', says Angela Merkel

To ensure that nations are keeping their budgets in check with the limits of the stability pact - deficits not more than 3% of gross domestic product and overall government debt of not more than 60% of GDP - Germany is pushing for the right to take countries in violation before the European Court of Justice.

Ind  02 Dec 2011

Angela Merkel vows to create 'fiscal union' across eurozone

Angela Merkel has vowed to create a "fiscal union" across the eurozone with wide-ranging powers to avert catastrophe, saying the process was already under way as part of the "marathon" effort to solve the European debt crisis.

The German chancellor said she was determined to push for treaty changes at next week's EU summit, and again reiterated German opposition to eurobonds ...

Gdn  02 Dec 2011

Killing the Euro

The combination of austerity-for-all and a central bank morbidly obsessed with inflation makes it essentially impossible for indebted countries to escape from their debt trap and is, therefore, a recipe for widespread debt defaults, bank runs and general financial collapse.

I hope, for our sake as well as theirs, that the Europeans will change course before it’s too late.

But, to be honest, I don’t believe they will.

In fact, what’s much more likely is that we will follow them down the path to ruin ...

NYT  02 Dec 2011    Euro Crisis    Global Risks 2012

Germany is the ultimate victim of EMU

The Fed and the Euro

'We feel your pain'

Eurozone states will need an act of union to save the single currency

Reform the euro or bin it

Eurozone crisis

Sarkozy: France Germany ties key to eurozone stability

It was OK for Greece and Italy to lose sovereignty, but for France, the sovereignty fudge goes on. So no transfer union?

The French President, Nicolas Sarkozy, has said France and Germany must come together to ensure stability at the heart of Europe ...

... Mr Sarkozy said he and the German Chancellor, Angela Merkel, would meet on Monday to propose measures to "guarantee the future of Europe".

He warned that economic convergence would be long and difficult.

But he promised that France would not give up its sovereignty.

He said the euro could not continue to exist unless eurozone economies pulled together.

Europe had to be "refounded" he said, with France and Germany at its heart to ensure "a zone of stability".

"We must confront those who doubt the stability of the euro and speculate on its break-up with total solidarity.

"France is fighting so that Europe can still make its voice heard in the world of tomorrow," he said.

Stricter financial discipline was needed, he added, with more severe sanctions for countries which did not meet their responsibilities.

BBC NEWS  01 Dec 2011    Euro Crisis

A Philosopher's Mission to Save the EU

"Zur Verfassung Europas" ("On Europe's Constitution") is the name of his new book, which is basically a long essay in which he describes how the essence of our democracy has changed under the pressure of the crisis and the frenzy of the markets.

[Jürgen] Habermas says that power has slipped from the hands of the people and shifted to bodies of questionable democratic legitimacy ...

[He] refers to the system that Merkel and Sarkozy have established during the crisis as a "post-democracy."

The European Parliament barely has any influence.

The European Commission has "an odd, suspended position," without really being responsible for what it does.

Most importantly, however, he points to the European Council, which was given a central role in the Lisbon Treaty -- one that Habermas views as an "anomaly."

He sees the Council as a "governmental body that engages in politics without being authorized to do so."

He sees a Europe in which states are driven by the markets, in which the EU exerts massive influence on the formation of new governments in Italy and Greece, and in which what he so passionately defends and loves about Europe has been simply turned on its head ...

Der Spiegel  25 Nov 2011    Euro Crisis    Europe: Social or Social Darwinist?    

In Search of a United Europe

The dream of a united Europe will remain vague as long as European governments try to promote integration by way of intergovernmental agreements.

As long as Europe is shaped by national leaders, they will always focus exclusively, or at least primarily, on the people whose interests they are sworn to represent: their voters.

This is the real drawback of all models that are based on increasingly close cooperation among European governments.

Even former German Foreign Minister Joschka Fischer's plan to bring together parliamentarians within a European group does not change the fact that they are ultimately answerable to voters at home.

As long as Europe's democracies are organized and oriented on a national basis, citizens will never be able to look beyond the confines of their own countries ...

Der Spiegel  24 Nov 2011    Euro Crisis    Europe: Social or Social Darwinist?

Why Merkel Remains Opposed to Euro Bonds

'The Crisis Has Hit the Entire Core of the Euro Zone'

Bid to change EU treaties agreed

So who is going to 'deal with' fiscal policy, Angela?

... Mr Sarkozy said that France and Germany would present "propositions for the modification of treaties" in the coming days.

Mr Sarkozy appeared to temper his calls for the European Central Bank to play a bigger role in solving Europe's debt crisis.

He would not give details on what the treaty changes might be but said they would be ready in time for the next EU leaders summit on December 9 ...

Mrs Merkel insisted that the proposed changes would "not deal with the European Central Bank", which she stressed was responsible for monetary, not fiscal, policy ...

Ind  24 Nov 2011    Euro Crisis

France, Germany and Italy squash market hopes of ECB intervention

Merkel, Sarkozy and Monti rule out seeking help from ECB

Germany suffers "disaster" at bond auction

Spain's debt crisis worsens as country begins month of post-election limbo

Rajoy ... must also obey the dictates of an EU, dominated by German chancellor Angela Merkel, which has imposed severe austerity programmes on member countries with debt problems.

"A large part of his most immediate programme is already set out in the fiscal consolidation plan demanded by Europe," (Jesús Ceberio, a former El País editor) said.

Rajoy will, for example, be unable to choose Spain's deficit levels over the next three years, as strict targets have already been set by the EU ...

Rajoy's main message to investors is that Spain will be "compliant", meaning it will meet the deficit target of 4.4% set by the EU for next year.

In a country where growth is zero and austerity already threatens a double-dip recession, that is likely to require further massive spending cuts or tax hikes, or a mixture of both.

On Sunday night he pledged to make Spain respected in, among other places, Frankfurt.

That was recognition that the country now depends heavily on the Frankfurt-based European Central Bank, which has been buying Spanish bonds to keep yields down.

Rajoy is, however, in tune with Merkel ... Merkel's spokesman, Steffen Seibert, said they discussed "Spain's great problems".

Reforms that bring no cost to Spain's cash-strapped treasury, such as to the labour market, may come first.

Jaime García, an economist at a PP thinktank, said he expected Rajoy to announce "shock measures" soon.

Gdn  21 Nov 2011

Spain

Politicians under the euro: at the wheel but not steering

In the case of Spain and Greece, their response to the sovereign-debt catastrophe has been effectively directed by the rest of Europe.

Mr Zapatero tried initially to ignore the looming crisis, then went for Keynesianism-lite – before being told by Germany and France to go for austerity.

As in Greece, the Spanish left have actually followed their austerity programmes as far as they could, bringing down government deficits even while destroying their own electoral standing.

The Greeks and the Spanish cannot devalue their own currencies – but everything else they have done has been according to the austerity-economics textbook.

And it hasn't worked.

For all the current talk about a democratic crisis in euroland, the politicians themselves gave much of their own sovereignty away in the preceding decade.

From Blair to Zapatero, the fashion in social-democratic thinking has been to abdicate power – and now bond markets are filling the vacuum.

Gdn  20 Nov 2011    Bankocracy Log    Euro Crisis

European Union prepares for the 'great leap forward'

Despite talk of an elected head of the Brussels executive, and beefed-up powers for the EU Parliament, there's no real indication that Brussels understands the need for a democratic federal constitution on the lines of the USA.

Technocracy, like capitalism, is the only show in town.

The buzzwords in the corridors of the commission's Berlaymont building in Brussels are "discipline, surveillance and enforcement".

Countries that fail to follow the austerity writ from Berlin and Brussels are liable to be subject to harsh sanctions ...

Fines will be complemented by intrusive "supervision" ...

"What's the alternative?" asks one senior EU official.

"We have seen democracies outstripped by the markets, which have forced decisions on elected governments. So that democratic freedom has been curtailed.

"How do you respond? Do you let that continue, or do you move towards stronger economic governance? ...

Will the eurozone's population ultimately be reconciled to emasculated national parliaments enacting austerity programmes that may take their countries back into recession?

Barroso has taken to quoting the wisdom of another of the founding fathers of the EU, Jean Monnet:

"People are ready to change when they understand there is no alternative."

Obs  20 Nov 2011    Euro Crisis

We'd better get used to living with the euro crisis. It's the new normal

There are two main schools of thought when it comes to fixing the eurozone debt crisis at the moment.

The first is that matters will come to a head around Spring and a solution will be found.

The second is that matters will come to a head around Spring and the euro will implode, pitching the world into another great recession ...

But there is a third scenario.

That the current stalemate persists throughout the year and deep into 2013, when the permanent European rescue mechanism is finally launched ...

The focus now is on what the new technocratic governments in Greece and Italy can achieve, while the European Central Bank appears to do be tinkering in the bond markets to keep government borrowing costs around the “unsustainable” 7pc mark.

If anything, the current status looks like the new normal ...

Tel  18 Nov 2011

Goldman Sachs conquers Europe

Spain was managing to keep a low profile

German memo shows secret slide towards a super-state

Government denies Germany inspecting our 2012 budget

EU Commission Urges Greece to Tighten Tax Collection

Spain's borrowing costs hit 14-year high

Franco-German Battle over the ECB Intensifies

IMF Europe director resigns

The markets distrust democracy

The EU crisis demonstrates that free trade has gone far enough

Goldman Sachs conquers Europe

... by putting a senior adviser at Goldman Sachs in charge of a Western nation, it has taken to new heights the political power of an investment bank that you might have thought was prohibitively politically toxic ...

It is not just Mr Monti. The European Central Bank, another crucial player in the sovereign debt drama, is under ex-Goldman management, and the investment bank's alumni hold sway in the corridors of power in almost every European nation, as they have done in the US throughout the financial crisis.

Until Wednesday, the International Monetary Fund's European division was also run by a Goldman man, Antonio Borges, who just resigned for personal reasons.

This is The Goldman Sachs Project. Put simply, it is to hug governments close ...

The Project is to create such a deep exchange of people and ideas and money that it is impossible to tell the difference between the public interest and the Goldman Sachs interest ...

Ind  18 Nov 2011    Bankocracy Log    Corporate State Log    Euro Crisis    Goldman Sachs: Doing God's Work

The markets distrust democracy. Just ask the masters of Beijing and Moscow

Why is the democratic world faring so much worse than its non-democratic rivals in the current storm?

Start with austerity.

It may not be the best solution for a worldwide crisis of anaemic growth and falling demand – indeed it is surely making the problem worse – but it is what the markets demand in return for manageably low rates of interest on the money they lend to governments.

That it is these men, not those we elect, who are all-powerful is not new: Bill Clinton discovered as much nearly two decades ago ...

Given that it is the markets who call the tune, the question then becomes one's ability to dance to it most nimbly – and in that endeavour democracy is an impediment ...

In the immediate postwar era, people might have been readier to endure rationing and hardship in, say, Britain because there was a sharper sense of collective identity and solidarity ... now society is less cohesive: austerity is seen as the result not of defeating foreign tyranny in a just war but of bankers' reckless greed; and few believe, as they once did, that they are guaranteed to be better off than their parents ...

The larger problem of democracies' weakness has not been caused by the economic crisis, so much as revealed by it.

The growth statistics for the pre-crash decade tell a revealing story. The EU, US and Japan did OK, clustered together in the low single digits.

But China and Russia enjoyed figures nearly twice as high. The best performing economies were the most authoritarian states ...

Gdn  15 Nov 2011    Contesting the Markets    Global Risks 2012    
Is Capitalism the only game in town?    Neoliberal Globalization: Pawns or Players?    Third face of power

Sergei Magnitsky

Is corruption in Russia's DNA?

EU's inner 'politburo' flexes its muscles

Just like China ... democracy: it's so incovenient

... a kind of politburo has emerged ...

Chancellor Angela Merkel and President Nicolas Sarkozy have been joined by one other democratically elected leader - Jean-Claude Juncker, the Prime Minister of Luxembourg, who also happens to chair meetings of eurozone finance ministers.

Also at the table are five others chosen by their peers: Jose Manuel Barroso and Ollie Rehn from the European Commission; Herman Van Rompuy from the European Council; Mario Draghi, the new president of the European Central Bank; and all the way from Washington (but really from France) Christine Lagarde, the head of the IMF.

It has been christened the Frankfurt Group, after the venue of their first meeting ...

It has been pressure from members of the Frankfurt Group which has helped unseat recalcitrant prime ministers in Italy and Greece.

That may raise questions about democratic legitimacy, but these are extraordinary times ...

German Chancellor Mrs Merkel said on Thursday that her only goal was to stabilise the eurozone in its current form.

But to do that will cost vast amounts of money, and - in one way or another - most of it will have to come from Germany itself ...

BBC NEWS  11 Nov 2011    Euro Crisis    

How eurozone turmoil could make its way across the Channel

Eurozone crisis threatens to spread to France ...

Democracy versus the eurozone

It may well be that Mr Papandreou has chosen the referendum option to save his own skin.

The likely question voters will be asked is whether they support the Brussels bailout deal.

The Greek prime minister will turn it into a referendum on whether they want to stay inside the eurozone.

Polls suggest that 70% of Greeks want to keep the euro. The PM will say that a No vote will lead to default, bankruptcy and chaos ...

The opposition will argue for elections with the promise that they would re-open the terms of the bailout deal.

Their argument is that what Greece needs now is growth and that austerity is strangling the country ...

BBC NEWS  02 Nov 2011    Bankocracy Log    EU Log

Greece on brink of collapse in euro crisis

Greek military leadership changes spark opposition outcry

Eurocrats are terrified of democracy

Austerity not the way to go for Europe