Category: Europe

Greece Folds

Well, that didn’t take long.

It turns out that math is not subject to a referendum.

Greece and its European creditors announced an agreement here on Monday that aims to resolve the country’s debt crisis and keep it in the eurozone, but that will require further budgetary belt-tightening that Prime Minister Alexis Tsipras could have trouble selling back in Athens.

The agreement does not guarantee that Greece will receive its third bailout in five years. But it does allow the start of detailed negotiations on a new assistance package for Greece.

The total commitment of money has not been disclosed. But a document by the eurozone leaders noted that experts had estimated that Greece might need from 82 billion to 86 billion euros more — $91 billion to $96 billion — to shore up its economy, rebuild its banks and meet its debt obligations over the next three years. The document said Greece and its creditors should seek to “reduce that financing envelope,” if possible.

As part of Greece’s commitments, Ms. Merkel said, a fund will be created to use the proceeds from selling off assets owned by the Greek government to help pay down the country’s debt. That fund would be “to the tune of” €50 billion, she said.

Greece will also be required to seek assistance from the International Monetary Fund and to agree to let the organization continue to monitor the country’s adherence to its bailout commitments. The Greek government had resisted a continued role for the I.M.F., seeing the fund’s involvement as unwanted meddling.

The agreement will call for Greece to raise taxes in some cases, pare pension benefits and take various other measures meant to reduce what critics see as too much bureaucracy and too many market protections that keep the Greek economy from operating efficiently.

In other words, Greece has to do what they’ve always had to do: fix their broken tax system, fix their broken pension system, stop spending money they don’t have, sell off bloated Greek government assets and clean up the corruption.

It’s not clear that this will happen: the Greek parliament still needs to approve it. But it is clear that Greece’s left-wing government has accomplished very little other than making the pain worse for their citizens, all to the cheers and plaudits of comfy Western liberals who see this as some kind of experiment in economics and an opportunity to show those damned austerians what’s what.

The alternative for Greece in exiting the Euro. Virtually the entire American Left, who are apparently fine with the idea of a government weaseling out of its debt, thinks this is a better option. The BBC has a great summary of what a Grexit would mean:

The previous Greek Prime Minister, Antonis Samaras, warned that living standards could fall by 80% within a few weeks of exit.

Unable to borrow from anyone (not even other European governments), the Greek government would simply run out of euros.

It would have to pay social benefits and civil servants’ wages in IOUs (if it pays them at all) until a new non-euro currency can be introduced.

The government would not be able to repay its debts, which now amount to a total of about €320bn (£237bn), most of it owed to European governments and agencies and the International Monetary Fund.

The government would have to impose a freeze on withdrawals and on people taking money out of the country. This could lead to queues of ordinary Greeks trying to empty their bank accounts before they get converted into a new currency worth substantially less than the previous one.

In the longer run, Greece’s economy should benefit from having a much more competitive exchange rate.

But the devaluation would not solve underlying problems in the economy, including poor tax collection and a struggle to control government spending.

There is also a real possibility of a surge in inflation.
Tax receipts would probably fall as the economy contracted, so the government might finance spending by printing money.

The likely currency depreciation would also be inflationary. It would make imported goods – which in Greece includes a lot of its food and medicine – more expensive.

That’s just the effect on Greece. It might also encourage other countries like Spain to leave. And worldwide, the effects would be very unpredictable.

That’s what the people glibly talking about a Grexit are contemplating. Seems a steep price to pay so that you can side with the deadbeats against the Germans.

As if we needed more proof..

The world is experiencing a destructive collapse of the “Print, borrow & tax so we can spend more than we have to buy votes” mentality. This progressive idea that you government can control and drive economies has been destroying economies ranging from Greece – which again gets an extension to a certain doom that can simply not be avoided because eventually even Germany will be out of money – to that of China where the games to make a centrally planned economy look like something that can work, to examples here at home in the US itself. States like Illinois and California, bastions of liberalism and wholly owned democrat entities, are not just collapsing under the weight of their idiotic beliefs that they can simply continue to fleece the productive to buy votes from what amounts to a large portion of people – many of them illegal citizens – that now just vote for a living.

Nowhere is the destructive nation of the progressive way of doing things more evident than at municipal level. Cities like Detroit, Washington D.C, Chicago, Baltimore, and so on, are basically imploding under the weight of stupid ideas and government. The sad thing is that one city that was almost spared that fate, because the voters wizened up and got rid of the democrat cabal that was raping the productive and basically making the place a shithole, is now back on track to implode under the weight of the progressive nature’s stupidity. Yeah, this article deals with minutia, but that’s actually the problem. Its a whole bunch of small things that look like they are not really important that all come together to make a big picture.

And while the democrat controlled city’s representatives are wasting time arguing about if you should be allowed to piss on the streets or not, they are busy wrecking everything else by basically destroying the goose that laid the golden egg. Heinlein had it right when he pointed out that in general assholes will never appreciate the fact that it is a few people that do all the things that make life good and easy for the rest of us. He was also dead on that instead of showing gratitude the masses would actually despise these people that brought them economic progress. As he posited, they will turn on the productive – out of nothing more than envy, jealousy, and greed – and run them out of town. Then as things indubitably collapse, the dickheads that did this will call it bad luck.

We have the most inept and craven political class in my entire lifetime. These credentialed shitbags grew up in a system, imposed on us by the progressive movement that rewarded the behavior they excelled at: talking out of both sides of their mouths while never accomplishing anything of value. It’s the “everyone gets a trophy” generation showing us what we have wrought. That is why these people, once they left the cocoon of the corrupting school system that indoctrinates and rewards these idiotic and destructive beliefs, chose to go into government. It is the only place where massive ineptitude, delusions of one’s own abilities and achievements, and a complete lack of understanding of how economics or human nature make the real world work, constantly rewards failure. It’s where people that wouldn’t amount to anything but store clerks, despite all their supposed education, can steal from the productive and indulge their complexes.

NYC, like too many places in this country, are being run by people that have profited from a system that rewards cronyism and ineptitude, punishing the productive in the process, and growing the number of government tit suckers. It is no surprise that all it took was a couple of progressive mayors to set the place back on a fast track to implosion. Obama promised he would fundamentally change the country, and he is doing the same thing DeBlasio is doing to NYC. And many progressives think this is all a good thing because they despise the very country that has played the role of the producer in Heinlein’s quote for doing so. The wreckers are in charge, and they are doing what they are good at.

Greece Puts Up The Middle Finger

With the government restricting banking and capital, the Greek people voted yesterday against complying with their creditor’s demands. I’ve said this before and I have little to add: fuck Greece. If they want to leave the Euro, open the door for them. Call them a cab. Book them a flight. The only real concern is that they might drift into the Russian sphere of influence. But given that Russia’s economy is imploding, I don’t see that happening.

I was wondering if maybe the Greeks made the right decision but when I read that Krugman was in favor, I was reassured that it was a bad decision (among other things, Krugman describes the demands of Greece’s creditors as undemocratic. It’s apparently democratic for 2% of Europe’s population to demand free money from the other 98%). He doesn’t address Greece’s huge problems with tax compliance and massive pensions — the real causes of the current crisis. These problems will exist whether Greece is under the Euro, the Drachma, the Ruble or the Triganic Pu.

The UK Votes

The UK election is going tonight. It’s looking close. The Tories may win more seats by the Scottish National Party is set to win all of Scotland and may join with Labour to form a government (which may end up resulting in Scottish Independence).

I mildly support the Tories but the key word is mildly. Cameron has reigned in the out-of-control spending binge of the previous Labour government. But he has also supported some of the starkest internet censorship in the Western world.

We’ll see what happens.

Seriously, Greece?

A few weeks ago, I wrote about the Greeks electing Syriza, a hard left-wing party that promised to walk back austerity. Since then, the Greek situation has gotten far worse. They negotiated some slight concessions, but most of Europe — including the other PIIGS — held fast. And Greek tax collection have collapsed as most Greeks assumed, with Syriza in power, that the days of having to pay their bills were over. It hasn’t even been two months and the coalition is already floundering.

Now they’re having a conniption fit:

Greece will unleash a “wave of millions of economic migrants” and jihadists on Europe unless the eurozone backs down on austerity demands, the country’s defence and foreign ministers have threatened.

The threat comes as Greece struggles to convince the eurozone and International Monetery Fund to continue payments on a £172billion bailout of Greek finances.

Without the funding, Greece will go bust later this month forcing the recession-ravaged and highly indebted country out of the EU’s single currency.

Greece’s border with Turkey is the EU’s frontline against illegal immigration and European measures to stop extremists travelling to and from Islamic State of Iraq and the Levant (Isil) bases in Syria and Iraq.

Panos Kammenos, the Greek defence minister, warned that if the eurozone allowed Greece to go bust it would give EU travel papers to illegal immigrants crossing its borders or to the 10,000 currently held in detention centres.

They’re now trying to walk back those comments so this may just be frustrated rhetoric. But I stand by what I wrote six weeks ago:

Fuck Greece. They’ve gotten tens of billions of dollars in help and their response is to whine and cry because they can no longer live high on the hog on a fraudulent system paid for by other countries. Don’t let them leave the Euro; kick them the hell out. Let inflation and default ruin their economy. Maybe then they’ll figure out that you can’t run a country on bullshit.

You can’t run it on threats either.

(Via Tyler Cown, who has been calling Syriza the Not Very Serious People. We may have to elevate that to the Not Very Sane People.)

New School Russia is Old School Russia

We got another startling reminder of exactly who we’re dealing with this weekend when a Russian opposition leader was brutally gunned down just meters from the Kremlin. Russia is seeing some protests. What they really need is a rebellion.

I suppose we can’t say for sure that Putin is behind this. But it is odd, isn’t it, how his enemies keep dying under mysterious circumstances.

There’s not much we can do about Putin at the moment. But based on his success in the Ukraine, he is clearly starting to look North. And the countries he is looking at our NATO members.

This could get very ugly very fast.

Beware Greeks Breaking Bonds

Just recently, I read Michael Lewis’s Boomerang, which includes a long essay on the economic problems of Greece. It’s difficult to describe Greece’s economy without the words “holy fucking shit, dude, are you serious?” but I’ll try.

For years, the Greek budgets were a fraud. The EU rules required them to keep their deficits below 3% of GDP. But massive amounts of the Greek economy are underground. Their system encourage abuse and fraud so that very few people pay taxes and no one thinks they should pay taxes. Government spending figures were made up so that they could comply with EU budget requirements. Their government is large and pays salaries much higher than any other country. And they can retire at age 50 and draw huge pensions. They also have a fertility rate of 1.3, so it’s not like a baby boom is going to sustain this massive wave of retirees.

When you know the details, you realize just how necessary the recent austerity was. Greece was in so much debt and their budget was so out of control, they had to make drastic changes. This wasn’t some evil imposition by imperialistic Germans; this was math.

Well, the Greeks voted today for an anti-austerity party:

Exit polls suggest a historic victory for the anti-austerity Syriza party in Greece’s general election.

The polls indicate that Syriza took between 36% and 38% of the total vote, with the ruling New Democracy party a distant second with 26%-28%.

It is unclear whether Syriza has enough votes to govern the country alone.

Syriza’s Alexis Tsipras has pledged to renegotiate Greece’s debt arrangement with international creditors.

He has also vowed to reverse many of the austerity measures adopted by Greece since a series of bailouts began in 2010.

The result is being closely watched outside Greece, where it is believed a Syriza victory could encourage radical leftist parties across Europe.

The exit polls suggested Syriza had won between 148 and 154 parliamentary seats. They need 151 seats for an outright majority.

(Aside: there are a lot of liberals who think we should have a parliamentary system in this country, mainly because they don’t like Obama being opposed on legislation. This election is a good demonstration of why I don’t like parliamentary systems. Syriza is going to take over Greece based on a third of the vote. The parliamentary system encourages radical minorities to take the wheel of government and spin it madly. I’ll take our gridlock, thank you.)

Fuck Greece. They’ve gotten tens of billions of dollars in help and their response is to whine and cry because they can no longer live high on the hog on a fraudulent system paid for by other countries. Don’t let them leave the Euro; kick them the hell out. Let inflation and default ruin their economy. Maybe then they’ll figure out that you can’t run a country on bullshit.

Maybe other people will too.

Frosting on a turd still means you are getting a turd

Seven years of the left being in charge have devastated support for the stupid shit they believe in and do in the US, so with people turning away from them in droves, the left’s now banking on rewarding millions of criminals that jumped our borders with residency or citizenship and numerous other tax payer paid for perks. Of course, this plan is not playing well with any of the traditional democrat support groups whom correctly diagnose that it will not just cripple their economic opportunity, but make the piece of the pie available for the freeloaders much smaller. Though times, but have no fear, because because Obama has a plan to buy votes yet again. Here is the first line of the article:

President Barack Obama’s proposal for free community college tuition is either a game changer or an empty promise. It just depends who you ask.

Me, based on all the other promises these idiots have made, will go with the later: it is a heaping pile of bullshit masquerading as gourmet food. Free college is idiotic and will solve nothing. College used to be a way for those with more than the average skillset to show they met a certain bar for employment in careers that required more than just intelligence, dedication, hard work, and ingenuity. The ugly truth is that not everybody is college worthy, and we should admit so instead of pretending otherwise. The left decided that the problem to their economy bursting policies and agenda was to make everyone get a college degree, regardless if they had the aptitude, skills, or actually needed it to do what they could find as prospective employment. In the process they have completely diluted the value of a college degree and education. And they did it while dumbing down primary education to the point that too many college applicants ended up woefully unprepared and unqualified for what came next.

With the economy going south and a rigged systems letting people with no chance of completing a college degree of any worth still indebt themselves to in the end fail, the left’s solution is to make the productive pay for this burden. This is the way it used to be in Europe. I said “used to be”, because that’s no longer the case. The days of spending 6-10 years at a university studying crap that would not lead to any kind of gainful employment are over. Students now have to graduate in allotted times and they have to pay for most of their education. More importantly, they have quotas for each type of college degree. You can’t have 50K history students if there are 5K jobs waiting for them. The funny thing that bears mentioning however, is that their tax burden, which was implemented for things like free healthcare and free education, neither of which is anything resembling free anymore, remains the same. Who would have thunk it huh? All that money now goes to pay for people that sit on their ass and can’t work, a whole lot of them with 10 year college degrees in worthless fields of studies, and for a political and bureaucratic monster that adds little or no value.

So back to Obama’s free community college plan. Many people see the emperor with no clothes’ plan for what it is – nothing but a desperate attempt by democrats to both help out one of their biggest donor groups keep their house of cards from facing the reality of the times and keep the wheels on the indoctrination train – and of course, as soon as that was pointed out, the accusations, desperate and veiled tried to make it about race.

Frankly I believe that less people going to college and government getting out of the racket of subsidizing the indoctrination centers and paying off one of the democratic party’s biggest donor blocks would do wonders to improve the higher education racket. The best move they could make is to hold colleges and universities accountable for the loans incurred by the students. Students that fail out should automatically have colleges become financially liable for at least half of what they now owe in student loans. Those that graduate with degrees that only let them find employment asking people if they would like fires with that should similarly have recourse against the school that charged them an arm and a leg for what amounts to a worthless degree. Of course, something like this would spell the end of so many of the left’s specialized grievance rackets passed off as education these days. It would however help those that somehow show they are better prepared and qualified to attend college.

Spare the American tax payer of another bad and costly mistake. Tell Obama to stick to golfing and talking about how racist everyone that disagrees with him is.

Frack the Russians

It is well known that, during the Cold War, the Soviet Union quietly funneled money to Western peace movements. It funded people who opposed nuclear weapons and wanted unilateral disarmament of the West. It funded people who opposed strategic nuclear weapons in central Europe. It funded parts of the anti-war movement.

To be clear, most of the people involved in these movements had no affiliation with the Soviet Union or knew of Soviet involvement. They were “useful idiots”. But many in the leadership knew. And, to be clear, Soviet funding did not make these movements illegitimate, per se. You could oppose Vietnam and nuclear weapons and not be a Communist stooge. But the Soviet Union had and pursued an interest in certain factions within Western politics that overlapped with their own interests.

Nothing changes, does it?

NATO Secretary General Anders Fogh Rasmussen recently announced that the Russian intelligence service was covertly funding European environmental NGOs to support their campaign against fracking. The former Danish Prime Minister stated that he had “met allies who can report that Russia, as part of their sophisticated information and disinformation operations, engaged actively with so-called non-governmental organizations – environmental organizations working against shale gas – to maintain European dependence on imported Russian gas.”

The accusations do not seem too far-fetched. Russia is very keen on dissuading Europe from exploiting its shale reserves. Disregardful of their own massive fracking projects in Siberia, Vladimir Putin uses environmental arguments to push an EU-wide fracking ban. In a similar fashion, he tries to discourage the US from exporting of Liquefied Natural Gas (LNG) to Europe. This is an option some European politicians such as Britain’s Foreign Secretary William Hague suggested as a way to reduce European energy dependency from Russia. It is currently on the table in the negotiations on the trade agreement between the European Union and the United States (TTIP).

Right now, much of Europe is dependent on Putin’s oiligarchy for their energy. Fracking is not only a threat to that but a threat to all of Putin’s imperial ambitions. Wide-scale fracking would deliver a huge blow to the Russian economy. So naturally he opposes it. Naturally, as former KGB, he’s willing to fund anti-fracking groups. And I suspect that, like the Peace movement, some within the anti-fracking leadership are aware of this and more than willing to take his money.

Fracking opponents will, of course, claim that Putin’s money doesn’t matter; fracking is so awful that they have to oppose it. They will, of course, claim that what they want is a world that runs on renewables, with neither fracking nor Putin having a role. But that’s living in fantasy world. Even under the most optimistic assumptions, Europe will not be able to provide more than a fraction of their power through renewables within the next few decades. And with nuclear now on the wane, that means they will need tons and tons of fossil fuels.

So it really is a matter of picking the lesser of two evils. In fracking, you have some legitimate environmental concerns (most of which have been addressed or are being addressed). But you have a less carbon-intensive source of energy and companies that are accountable to Western nations. Russian oil not only props up a bloodthirsty tyrant, it supports one of the dirtiest polluters on the planet. As bad as fracking may or may not be, Russian oil is far worse for the planet, for Eastern Europe and for global security.

Fracking opponents will tell you that fracking is being pushed by “dirty money” from natural gas interests. But, good Lord, is there any money dirtier than Vladimir Putin’s?

What progressivism – Social Justice, in a nut shell – always ends up being.

Venezuela is the latest example of what progressivism works out to be in a nutshell. Chavez, another idiot that gained power passing himself off as a man of the people, and buying votes by promising to rob his country’s producers in the name of some fabricated and idiotic social construct, has ruined what once was a growing and thriving economy. Sure Venezuela had problems and poverty before Chavez, but things are far, far worse, today. Case in point, the death of the goose that laid Venezuela’s golden eggs:

As weird as it seems, President Nicolás Maduro’s government plans to start importing crude oil for the first time in order to blend it with Venezuela’s own crude and keep the country’s overall production from falling further, the Reuters news agency reported last week, citing an internal document from Venezuela’s state-owned PDVSA oil company.

It turns out that Venezuela’s own production of light crudes has plummeted since the late President Hugo Chávez took office in 1999, and the country desperately needs light crudes to blend with its Orinoco Basin extra heavy crude oils. Without such a blend, the Orinoco Basin’s extra heavy crude is too dense to be transported through pipelines to Venezuelan ports and exported abroad.

Venezuela’s oil production, which accounts for 95 percent of the country’s export earnings, should be used in world classrooms as a textbook case of what happens when a populist government starts distributing a country’s wealth in cash subsidies, without investing in maintenance and innovation. Much like happened with Cuba’s once flourishing sugar industry, Venezuela’s Chávez-inspired populism has destroyed the goose that laid the golden eggs.

In 1999, when Chávez took office, PDVSA had 51,000 employees and produced 63 barrels of crude a day per employee. Fifteen years later, PDVSA had 140,000 employees, and produced 20 barrels of crude a day per employee, according to an Aug. 14 report by the France Press news agency.

Venezuela’s net oil exports have plummeted from 3.1 million barrels a day in 1997 to 1.7 million barrels a day in 2013, according to U.S. Energy Information Administration estimates.

Curious to find out how a country with the world’s largest oil reserves can end up importing oil, I called Evanán Romero, a former Venezuelan vice minister of energy and former PDVSA director, who now works as an oil industry consultant.

Romero told me that the Venezuelan government desperately needs to speed up oil exports to get cash, because the government is bankrupt. Inflation has surpassed an annual rate of 60 percent, and Venezuela will be Latin America’s country with the lowest economic growth this year, according to World Bank estimates.

But to speed up oil exports, Venezuela needs to blend its heavy crudes from the Orinoco Basin with lighter imported crudes, because Venezuela is no longer producing enough light crudes of its own. Production of light crudes has fallen because of lack of investments, abandonment of exploration of light crude areas, and the nationalization of companies that used to help produce light crudes.

Venezuela has asked foreign companies that operate in the Orinoco Basin to invest in “upgrading” facilities that help make heavy-crude exportable, but the companies did not want to take that risk because they fear expropriations, or because they don’t think it’s a good investment as long as they are only allowed a minority ownership under government rules.

Collectivists always expect everyone else to sacrifice, and yet, they claim and believe they have the right to take the fruit of other people’s labor, no matter what the consequences of that theft, because they mean well. When others decide not to bend over and grab their ankles every time the progressives come a knocking, they get pissed and accuse them of being greedy. But the truth is nobody causes more harm, destruction, misery, and human indignity than your pretend do-gooder progressive as they steal from those that produce under the pretense of redressing some evil or injustice.

Humanity is heading for another dark age as the labors of the collectivists destroy centuries of progress by their betters. Everywhere that progressives have taken hold, things have gone, are going, or will go bad. The more open the thievery, the quicker the downfall. The Soviet Union and its satellite states imploded in a short 7 decades because they went to one extreme to push their corrupted version of paradise on earth. The last bastions of this idiotic belief are Cuba and North Korea, the Chinese long ago abandoning anything other than the tyranny of progressivist rulership – something that amounts to nothing more than another aristocracy lording it over the serfs, sometimes under the heel of a single madman that bathes in the blood of those he plunges into his contrived misery – in order to maintain power. They are all doomed, including the Chinese, because that system simply destroys man and man’s dignity.

New upstarts like Venezuela show us that those that do it without the usual bloody revolution and the millions of deaths, still lead the unfortunate idiots they have fooled down the same road. Progressivism’s promise of social justice always, without fail, produces misery and indignity. It matters little that they can, in the beginning and for some time, pretend or show that their actions have made things look better: in the end though, their actions produce the same outcome, be it in a short span of time, or over long decades. They destroy everything they touch, and the vital system that produces wealth collapses, leaving everyone living in misery and under the heels of a tyrannical master or oligarchy that thinks more of the same is what is needed to fix the very problem of their making.

Have no doubt that the shit done by the Western democracies is heading the same way. Obama’s reign in the US and his expedited efforts at the destruction of a once great nation, as well as and what’s going on in Europe, should leave no one any doubt that there is any way to salvage the situation if the progressives and their ways are allowed to continue. You can not steal from others – especially when you accuse them of having because they steal – to make things right. Greed and envy are not good emotions to base a philosophy that claims to want to right wrongs on, but that’s progressivism in a nut shell. In the end it only serves to replace whatever group one claims is engaged in some injustice with one person or another group that is doing fare worse evil.

It is time to tell these people to take a long hike off a short pier.