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Greece Votes for Austerity at Cost of Public Confidence

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In a 199 to 74 vote (with 5 voting present and 22 absent) the Greek parliament approved the plan from the EU leadership to enact greater fiscal austerity measures in exchange for nearly $170 billion in emergency funding. For the time being, the tenuous coalition in their parliament is holding, but only after the expulsion of some 45 members (23 from the Socialist Party, 21 from the New Democracy Party and 2 from the Popular Orthodox Rally Party) dismissed largely for breaking rank.

Reactions from the Greek populace are largely negative, some calling the acceptance of the deal “slavery,” and there are confirmed acts of rioting, looting, vandalism, and arson throughout the capital city. Much of the anger and outrage at the new austerity measures appears to be directed towards Germany, whose position throughout the resolution negotiations was for tougher fiscal responsibility rules. But public opinion doesn’t shine favorably upon Greek lawmakers who are quickly being cast as sellouts and traitors to Greece for accepting terms delegated by foreign authorities. Some even question what sort of country will be left for later generations and go so far as to doubt the possibility of a brighter future for Greece.

As one Elina Papafagou said while pointing towards the parliament chamber, “The worst thing though is that we can’t have dreams for the future. They’ve killed our hope.”

About Alexander J Smith III

  • Cannonshop

    If your hope is rooted in government money, then maybe it’s a false hope. Socialism is expensive, it requires an active and growing private economy to pay for it (in the form of taxes), and Greece hit the wall-their private sector didn’t generate enough money to pay for their governmental largesse.

    Kind of a working model of what you get when you go “Service Economy” and don’t produce actual wealth for decades on end while you expand and embellish your “Safety nets”.

    Greece is a lesson and a warning.

  • http://loftypremise.blogspot.com/ Tommy Mack

    Greece is in the situation of needing an advance and getting it, unfortunately Greece has to go to a Pay Day check cashing joint to get the money. In addition, Greece has to agree to work fewer hours and to pay usurious interest fees. That is what austerity means.

    The basic problem is that the people who favor austerity do not understand that deficits are a function, not a thing. As a function, the way to decrease a deficit is to increase GDP. It is not to go to money lenders.

    Tommy

  • Glenn Contrarian

    Tommy –

    As a function, the way to decrease a deficit is to increase GDP. It is not to go to money lenders.

    Quoted for truth!

  • Igor

    The austerity program is a cheat designed to extract money from Greek citizens to pay off foreign investors and banks. For what? What did they do for Greece other than to entangle the naive politicians of Greece in fancy financial gambles that only they understood, that were specifically designed to kick out big commissions and fees to the Goldman-Sachs swindlers who sold that crap to Greece.

    Greece should never have gone into the Euro because their economic processes are NOT the same as Europe. Greece has something like a Jubilee economy, which works for them because they abide by it. That just cannot fit into the American Economic model (which, from the looks of it, isn’t working so well in America, either).

    If Greece went back to their old inflationary Drachmas they’d be perfectly happy, that’s what they’re used to. It’s only the Anglo-American economic heritage designed to protect vested interests that can survive in the Anglo-American economy.

    Greece was happy with the old economy, and so were Greek visitors because it was cheap to visit Greece, and you didn’t worry about exchange rates, etc., because every little bank in every little town had an ATM out front (I remember the days before ATM when you had to wait for the bank to open at 10AM, or so, then jump through a bunch of hoops to convert greenbacks to drachmas, usually at some contrived rate).

  • Cannonshop

    #2 Tommy, I’d argue that Greece has been getting those ‘advances’ while not-looking-for-work. Eventually nobody’s going to lend you money when you do that, and you still have that massive debt. Greece has just hit that wall before WE did.

    Lacking an industrial base or business climate that attracts investment (and pays off if you invest in it), the only way to stabilize for a country like Greece, is to cut back on the spending. GOVERNMENT DOES NOT CREATE WEALTH-and without creation, you run out of wealth to redistribute-that’s happened to Greece, they’re now facing the hangover after the party.

    The only choice they’ve left themselves, after decades of expanding services and pensions, is cuts-because they don’t have the intrinsic means to build their GDP after rooting their economic model on being a tourist-trap where even the cheap souvenirs are imported from Asia instead of being made locally.

  • Igor

    #5-Cannon must be pretty dumb to buy tourist trinkets anywhere!

  • Igor

    I think the Greeks went to “…a Pay Day check cashing joint to get the money” a long time ago, except it was the crooks at Goldman-Sachs masquerading as a semi-legitimate business.

    Why the h*ll would anyone lend money to someone who’s broke except to extort even longer terms at higher rates? The Goldman-Sachs bruisers do just what any neighborhood gangsters would do. Didn’t you guys ever see those “Godfather” movies?

  • Clavos

    #5-Cannon must be pretty dumb to buy tourist trinkets anywhere!

    Old man, time for you to put your teeth in the glass and go to bed (don’t forget your meds!). Cannon never said (nor even implied) he bought tourist trinkets

  • Glenn Contrarian

    Cannonshop –

    GOVERNMENT DOES NOT CREATE WEALTH

    No, but it does enable the creation of wealth. It can do so by ensuring level playing fields, ending monopolies, prosecuting corruption, ensuring reliable sources of utilities, maintaining roads, standardizing regulations…

    …AND by protecting employees from the vagaries of corporate corruption, such as requiring safe and non-prejudiced working environments. If you, Cannonshop, want a good business environment, then you’ve got to be willing to pay the TAXES that are spent to support business as described above.

  • Cannonshop

    9-Glenn, Greece’s situation isn’t the result of worker’s protection, nor is it the result of a climate that enabled the creation of wealth. It’s the result of spending like a drunken boiler-tech in a SE asian liberty port, and you KNOW it.

    #7 Yup, about right-but you’re blaming the guy making the loan, instead of the guy who went out and GOT the loan, Igor. Loan-sharks don’t prey on people that are careful with their money, they prey on people who AREN’T careful. It’s the easy-credit-trap, only in this case, it’s on the scale of NATIONS instead of individuals. Nobody makes loans without expecting something back-that’s a fundamental of basic finance (and human nature). The only time this hasn’t been so PUBLICLY was the credit-frozen era known as the Dark Ages, when the Church forbade the charging of interest on loans-during that time, if you wanted to finance that shiny new castle, you had to go to the Jews, because they WOULD loan you the money-because they COULD charge you interest.

    Richard the Third burned down a good portion of the Jewish area of London to avoid paying back his creditors after the Crusade (that is, he killed them to avoid interest payments)-so really, even there, interest was a requirement before someone would lend cash.

    it’s fine to condemn Goldmann-Sachs for mismanagement, bad investment policies, predatory business practices, even corporate espionage and political corruption-but lending money for interest is a central function of ANY bank, so really you might consider that in this case, Greece’s debtor status is largely a self-inflicted wound.

    After all, they didn’t HAVE to adopt the expenditures and indebt themselves paying for it-they COULD have chosen a slower, more secure means to improve and increase services.

    They just chose the option that was politically expedient at the moment. Kind of like OUR government is doing.

  • Glenn Contrarian

    Cannonshop -

    I wasn’t speaking of Greece, even though that’s the subject of the article. I agree with you that Greece took things too far – retirement at 55 years of age, an extra month’s pay to all government workers in December (which is also done in other nations, too).

    However, it’s wrong to use the example of Greece to condemn social safety nets – that’s just throwing out the baby with the bathwater. There must be a happy medium – a social safety net for the truly disadvantaged and a reasonable hope for retirement, but without sacrificing the productivity of the nation in order to have those benefits.

    Moderation in all things, Cannonshop – including when it comes to free markets and social safety nets.

  • Igor

    #10-Cannon: so I guess it’s OK with you if Greece stiffs their creditors? It’s just the natural result?

  • Cannonshop

    #11 I’m not condemning the presence of social safety nets, Glenn-I’m condemning the practice of using those as vote-buy schemes, of “Running off with it” blind, (like Greece did), and of spending on things NOT social-safety-net in an uncontrolled, “we got money ’cause we got cheques” style of spending.

    You HAVE to scale your ‘net’ to what you can pay for, or it’s not a secure net. Period.

    Greece went well beyond what they could afford, we’re edging on doing the same, and frankly, if your social security net isn’t secure, then it’s no net at all.

    Greece is showing us what the long-term consequences of spending what you don’t have and can’t make leads to. they did it all “Now” instead of building the understructure and doing it gradually, with care, making certain that the money would BE THERE in the future.

    Basically, I’m saying that they did it wrong-and now, they’re insolvent, they HAVE to cut back-the Greek economy can’t pay for the Greek Government and its Governmental Largesse-the Largesse, therefore, needs to go if they’re EVER going to get out of that hole without a massive, third-world style default that does even MORE damage than they’re already experiencing.

    And that’s the future for US, if we don’t stop trying to buy the illusion of prosperity with tax dollars at the expense of the future.

    WE need to stop trying to police the world with our military, WE need to stop bailing out failed enterprises under “Too big to fail”, WE need to stop letting people draw from social security when they’re in their thirties and relatively healthy (SSI needs to be reworked), WE need to stop trying to “Fix” everything with the Taxpayer’s dollars, WE need to stop passing laws that can’t be enforced, buying “Security Theatre” BS like NDAA, DHS, and TSA, WE need to end this multibillion-dollar-failure known as the “drug War”. WE need to do these things, because if not, Greece is our future, followed shortly thereafter by Zimbabwe.

    #12 Igor, not everyone can stiff their creditors like you seem to be advocating here. A default would KILL Greece economically-the odds that they could EVER get out of the hole their past leadership put them in… In order to recover, the Greek government has to demonstrate a committment to making the country SOLVENT again-a default won’t do that.

  • Glenn Contrarian

    Cannonshop –

    Interesting rant – and it seems to me that you’ve at least as much political philosophy in common with Democrats as with Republicans, and perhaps more.

    I’m not condemning the presence of social safety nets, Glenn-I’m condemning the practice of using those as vote-buy schemes

    I’m assuming you’re referring to ‘Obamacare’. There’s only two ways to even come close to having the same level of universal health care that the rest of the First World does – by jacking up taxes, or by requiring an individual mandate (which was the GOP’s idea, remember).

    On the other hand, how many times have we seen GOP candidates (other than Ron Paul) try to rile up the ‘faithful’ by telling them Obama was going to take away their Medicare? Isn’t that the same kind of vote-buying scheme you’re referring to? (never mind that Rand Paul’s disastrous scheme would have done just that)

    ==============================

    But I want to go down your list:

    “WE need to stop trying to police the world with our military”

    Who was it that has recently been vilified by the GOP for proposing cuts to the military? Obama. Who is it that complained about how small our air force had become, and that we should consider bombing Iran? Santorum. And I don’t recall any of the other GOP candidates (again, other than Paul) pointing out how stupid his statements are. So in order to get what you want, vote Paul or Obama.

    ==============================

    “WE need to stop bailing out failed enterprises under “Too big to fail””

    Seems to me that you’re wanting another trust-busting (and quite progressive) Teddy Roosevelt. And you’d probably want campaign finance reform to stop corporations from owning politicians so we could go monopoly-busting when we need to – but it was YOUR conservatives on the Supreme Court that ignored a century of case law and threw open wide the gates of corporate funding. The only way you’ll stop corporations from being “too big to fail” is to have campaign finance reform…and if you want that reform, you might not get it from a Democratic congress, but you sure as hell won’t get it from a Republican congress.

    ==============================

    “WE need to stop letting people draw from social security when they’re in their thirties and relatively healthy (SSI needs to be reworked)”

    I remember how when my dad died, I got his SSI and it helped us through a really tough time. He had paid for those Social Security benefits, and I can’t imagine him not wanting me to get those benefits in the event he died. We were also on food stamps at the time. And that reminds me – why is it, Cannonshop, that it’s the residents of RED states that generally draw the highest proportion of public assistance?

    ==============================

    “WE need to stop trying to “Fix” everything with the Taxpayer’s dollars”

    And that’s what Obamacare was designed to do, because who pays whenever someone can’t afford the emergency room that costs three times the price of a regular hospital visit and several times more than preventative care that HMO’s don’t like paying for? Yep! The taxpayer! So if you want to stop paying so much in taxes to fix other people’s health problems, seems to me that you’d want to support Obamacare!

    ==============================

    “WE need to stop passing laws that can’t be enforced, buying “Security Theatre” BS like NDAA, DHS, and TSA”

    Do you really think your fellows in the GOP (other than Paul) would weaken or get rid of the NDAA or the DHS? Do you really? If you’ll read the news, Cannonshop, it’s progressive Democrats like myself and libertarians like Dave Nalle who view the creeping ‘security theater’ with alarm…and who is it that supported torture? Hm?

    But when it comes to the oh-so-incompetent TSA, you might find this interesting:

    The number of firearms detected in carry-on luggage by airport security screeners is on the rise. Last week in separate incidents in California two men were arrested trying to bring loaded handguns onto a plane.

    The arrests come on the heels of cases in Chicago (where an unloaded handgun was found in a businessman’s briefcase), New York City (where a Tea Party activist was cited for checking into a flight with a Glock and ammunition), and Texas (where a Fort Bragg soldier was found to be carrying five pounds of C-4 explosives onto a plane).

    Also last month, a loaded gun in a passenger’s bag discharged as security personnel handled the luggage at Hartsfield-Jackson Atlanta International Airport. The spate of recent incidents appears to confirm what Transportation Security Administration statistics suggest: The number of firearms being discovered by airport security has increased.

    USA Today reports that in 2011 the TSA said it found 1,238 firearms – nearly four a day on average – at airport checkpoints across the nation. In the summer of 2010 a TSA blog post had reported that security personnel were finding an average of two weapons a day.

    Most weapons are in carry-on bags being screened for fliers (who say they had forgotten the guns were inside), but in Detroit last month a 76-year-old passenger in a body scanner was found to have a loaded .38 pistol strapped to his ankle. In addition to firearms, the TSA is also finding Taser-style stun guns, some camouflaged as other items, such as a smart phone (left) or a flashlight.
    The TSA Blog reports that items discovered by airport screeners this past week include a speargun, a live tear gas grenade, and a knife concealed under the seat of a wheelchair.

    Now if it weren’t for the TSA’s efforts, how many of these incidents might have resulted in hijackings or terrorist acts? And how would those have affected YOUR job at Boeing? Hm?

    ==============================

    “WE need to end this multibillion-dollar-failure known as the “drug War””

    No argument there – but (other than Paul) do you see any real support for this from the GOP? No. And most of the states that allow medical marijuana are what? Blue. So while Democrats might not end the War on Drugs tomorrow, they sure lean a heck of a lot closer in that direction than the GOP does!

    ==============================

    “WE need to do these things, because if not, Greece is our future, followed shortly thereafter by Zimbabwe.”

    Moderation in all things, Cannonshop. Don’t throw out the baby with the bathwater. And it sure seems to me that your positions lay a lot closer to the blue side than to the red side…but of course voting for a Democrat is simply unthinkable, no matter how much closer their positions are to your own.

  • Cannonshop

    Glenn… I voted Cantwell into the senate, and voted to re-elect her every time she comes up. I don’t VOTE party-line, I vote for people I think are, if not on the same page as me, at least reading the same book.

    REGARDLESS of which den of crooks they happen to be affiliated with-Democrat, OR Republican.

    I wasn’t (surprise!) referring to Obamacare-that’s outside this discussion. I was referring to the D.C. ‘urge’ to get us involved in other people’s civil wars abroad, and the D.C. ‘urge’ to pass legislation and create bureaus every time something bad happens, even when the legislation or the bureau wouldn’t have prevented it. (There are too many to list there-everything from creating new-and-redundant spy agencies, to creating new-and-redundant agencies to do what other agencies are supposed to do but didn’t do.)

    Where you see ‘alarming trends’ involving passengers with unloaded firearms, I see one of two things:

    1. They’re getting caught committing a felony. That means that (amazingly) between ripping off wallets and personal items, the TSA is doing the same job that private screeners were doing ten, maybe eleven years ago-about as effectively, given the technology.

    2. idiots happen-a loaded firearm in the luggage? well…let’s see now… prior to 9/11 that would still have been a felony (Reckless Endangerment) in most states, and if the flight crossed state borders, that makes it a dual felony-reckless endangerment AND unlawful transport of a firearm (ATF jurisdiction), plus violation of several FAA regulations-with-the-force-of-law. I don’t see DHS or TSA being all that useful in that case, (and that’s not touching on the civil litigation possibilities, including the airline suing and the passengers or their families.)

    3. We’re finally reaching the air-travel volume we had before 9/11/01 happened, more people means more incidents.

    and…

    4. Soldier walks off post with C4-a controlled substance. Where was his chain of command? Who was responsible for that unit’s ordinance? Who didn’t clear the personnel at the range where he probably got it? Kinda like Brad Manning, standards in the service appear to be slipping quite into a decidedly 1970s level, aren’t they?

    Finally, your “tea partier” is about as likely to hijack a plane, as YOU are, Glenn. He’s got that gun, because he’s AFRAID, not because he’s MALIGN. rEmember, with all firearms banned from all flights, four airliners killed six thousand people because they were taken over by guys with BOX KNIVES-a weapon less effective in a fight than a coffee-pot.

    Personally, I suspect a cheaper and more effective antiterrorist method would be to armor the flight deck and hand out pistols loaded with frangible ammo to every frequent-flyer who wants one. Terrorists don’t go after people whom they percieve to be ready to fight back-they go after victims they KNOW are disarmed and/or helpless.

  • Glenn Contrarian

    Cannonshop –

    I’ll take the bitch-slap – I deserve it for assuming you’d vote party-line. I don’t, either – I never have.

    Anyway, when it comes to the TSA, I didn’t include the Teabagger because he was a Teabagger, but because it was part of the article…and regardless of your gripes about the TSA, they’re still catching on average two guns a day that would have been carried on board. Granted, nearly all of those are because the passengers are idiots…but “nearly all” isn’t 100% – and it only takes one individual with a gun on board to run everybody’s day…and directly affect your own paycheck.

  • George DeMarse

    Greek citizens are likely to rally against the austerity measures and throw out the politicians who voted for them. They are right. If the government overpromised on benefits, that’s the government’s problem–not the citizens. Pay up. In austerity measures the central bankers always go after the “working class benefits,” which are rarely “too much.” Go after the real money of the central bankers for a change, and other “revenue enhancers.”
    The Greeks are free to drop out of the EEC and go their own way. No doubt they would be happier and should do so. Their currency might be lousy, but they could live the way they want by simply voting for it.

    France is next and will elect a socialist president. Other countries will follow. The political blow back to austerity is just beginning.

    George DeMarse

  • George DeMarse

    Hello to all those nay sayers out there. I’m back and I was right. In my comment of March 6, I said the Greeks would throw the austerity bunch out. They did so by punishing the two major parties who voted for austerity.Now there are several fringe groups also entrenched in power both on the left and right, with no central party majority. The Greek voters also sent a negative message against the entire political system.
    Vive la France! The French sent Sarkozy packing, who was also a friend of austerity measures and cutting government benefits. They elected the socialist Hollande.

    Now I can hear you nay sayers shouting about “they can’t afford those government benefits–they are living beyond their means–their bond rating will be in the tank”–blah, blah, blah.
    It’s all baloney. They voted for what their governments promised them–so it’s time for government to pay up. The electorates voted for a better, more secure life and they are right.
    The socialist blowback is now in full force and spreading. The U.S. will also feel it and a legitimate socialist party is coming soon to an OWS site near you.
    Politics trumps global capitalism–see it at a theatre near you.

  • http://www.squidoo.com/lensmasters/IanMayfield Dr Dreadful

    George, don’t hold your breath waiting for any meaningful socialist movement to take root in the United States.

    Why, one only has to say the word socialism here for this music to start playing in the background.

  • George DeMarse

    I’m not holding my breath, but even American blockheads will eventually figure out that they have not been invited to the “successful capitalist” party and realize government is not making them poor and stupid, failing global capitalism is. And yes, it will take decades because blockheads are generally devoid of analytical skills.

  • Igor

    @5-Cannon: is just plain wrong. The US government HAS created wealth, great wealth. Enough to enrich many famous companies and families across America.

    Without government efforts the great transportation systems in the USA wouldn’t exist.

    It was the government that built ports and dredged their channels, it was the government that made international shipping lanes safe.

    It was the government that built airports when no private companies or airlines would.

    It was government that organized and financed common-guage railroads across America.

    It was the government that designed and built the interstate highway system.

    ALL those things were the engine of US industry.

    None of those things would have been done if we waited around for ‘private enterprise’ to do it.

    Without government the great computer and internet systems of the modern world would not exist. NO company, not even giants like IBM and Digital Equipment Corp., could build a network with public access.

    Without government the modern internet would not exist. You’d still be sending letters through the Post Office instead of sending a quick email, instead of making an iPhone call to another continent at almost no cost.

    None of those projects would even have started without the government.

  • Igor

    Looked at objectively, you’d have to say that the accomplishments of Capitalism are piddling compared to what the US government has done!