By Peter Boone and Simon Johnson
Some officials and former officials are taking the view that a large fund of financial support for troubled eurozone nations could be decisive in stabilizing the situation. The headline numbers discussed are up to 2-4 trillion euros – a large amount of money, given that German GDP is only 2.5 trillion euros and the entire eurozone GDP is around 9 trillion euros.
There are some practical difficulties, including the fact that the European Financial Stability Fund (EFSF) as currently designed has only around 240 billion euros available (although this falls if more countries lose their AAA status in the euro area) and the International Monetary Fund – the only ready money at the global level – would be more than stretched to go “all in” at 300 billion euros. Never mind, say the optimists – we’ll get some “equity” from the EFSF and then “leverage up” by borrowing from the European Central Bank.
Such a scheme, if it could get political approval, would buy time – in the sense that it would hold down interest rates on Italian government debt relative to their current trajectory. But leaving aside the question of whether the ECB – and the Germans – would ever agree to provide this kind of leverage and ignoring legitimate concerns about the potential impact on inflationary expectations of such measures, could a, for example, 4 trillion euro package really stabilize the situation?
To answer this question, think through the “best case” scenario in which the big package is put in place and, at least initially, believed to be credible. Proponents of this approach argue that in this case the “market would be awed into submission”, business as usual would prevail – meaning that Italy and other potentially troubled sovereigns could resume borrowing at low interest rates – and the 4 trillion euro fund would not actually need to be used.
This seems implausible. If the big government money shows up and this pushes down yields on Italian government debt, what will the private sector holders of that debt do? Some of them will sell – taking advantage of what they worry may only be a temporary respite and, for those who bought near the bottom, locking in a capital gain (as interest rates fall, bond prices rise – there is an inverse relationship).
So the European/IMF bailout fund would acquire a significant amount of Italian, Portuguese, Spanish and other debt (including perhaps Greece and Ireland). If the credit utilized from this fund, with its ECB backing, reaches – let’s say – 1 trillion euros, how will the Germans feel about the situation? Their worries will only be exacerbated by ongoing budget deficits, exacerbated by recessions, throughout the periphery. Someone will need to finance those deficits, and the stabilization fund is likely to be the financier.
On current form, the Italians will have promised moderate austerity but delivered little. The life styles of rich and famous Italian leaders will start to grate on north European taxpayers. Stories about corruption in Italian public life – perhaps exaggerated but with more than a grain of truth – will become pervasive.
In fall 1997, the IMF – with US and European backing – provided what was then regarded as a substantial package of support to the Suharto government in Indonesia. But then the government refused to close banks as agreed – and after one of President Suharto’s sons finally lost one failed bank, he immediately popped up again with another banking license. Stories about Indonesian official corruption and the ruling family were on front pages of major newspapers in the US.
Donor fatigue set in. In January 1998, when the Indonesian government announced a budget that had slightly less austerity than planned, it was roundly castigated by the international community. This set off a further sharp depreciation in the Indonesian rupiah, which worsened the debt problems of the Indonesia corporate sector – which had borrowed heavily and at short maturities in dollars. Panic set in, social unrest became increasingly manifest, and the real economy declined further.
Italy is not Indonesia and Mr. Berlusconi is not President Suharto – who ended up leaving office. But the comparison is still has value. Will the countries backing the enhanced and highly leveraged EFSF be willing to face substantial potential credit losses, i.e., actual and ongoing transfers from their taxpayers to Italians and others?
Lech Walesa famously remarked, it is easier to make fish soup from fish than to do the reverse. So it is with fiscal crises – once fear prevails and markets start to think hard about the stress scenario, it is hard to solve the problem simply with reassuring words or financial support that never needs to be used.
Crisis veterans like to say, quoting former President Ernesto Zedillo of Mexico: When markets overreact, policy needs to overreact in the stabilizing direction. But what really matters is not overreacting; it is making sure you do enough.
In Europe, the first thing peripheral governments need to do is stop accumulating debt, and quickly. Italian fiscal plans to balance the budget in 2012 look implausible as they assume unrealistic growth. The currently planned Greek debt restructuring and increased taxes will not turn that economy around — nor prevent Greece from accumulating even further debt. Despite all the reported austerity, the Irish government is still running a budget deficit near 12% of GNP in 2011 while nominal GNP actually declined in the first half of 2011.
Europe’s periphery also needs to recognize that it signed up to a currency union, and that requires a new approach to adjustment. Instead of having massive devaluations like Zedillo’s Mexico, or Suharto’s Indonesia and Walesa’s Poland, Europe’s troubled nations need to improve competitiveness through reducing local costs. That must primarily come through wage reductions and more competitive tax systems. In Ireland a pact with the major unions is preventing further wage reductions, while in Greece the government is strangling corporations with taxes in order to avoid deeper wage and spending cuts. The proposed Portuguese “fiscal devaluation” – meaning lower payroll taxes to reduce labor costs and increase VAT to replace the revenue – looks like a weak attempt to avoid talking about the need to much more sharply cut public spending and wages in real, purchasing power terms.
Putting in place a huge financial package is not enough. Policies have to adjust across the troubled eurozone countries so that nations stop accumulating debt, and the periphery moves rapidly from being least competitive nations in the euro area, to the most competitive and this includes lower real wages, even if debts are restructured appropriately. The European leadership is a long way from even recognizing this reality – let alone talking about it in public.
An edited version of this post appeared this morning on the NYT.com’s Economix blog; it is used here with permission. If you would like to reproduce the entire post, please contact the New York Times.
The Baseline Scenario 
People don’t admit how little they would work for, if their job became irrelavent or some bright rookie could do it for less with a quick change of a law. No, they simply do the opposite, dig in for more bennies and tenures to prevent others from competeing for their position. And on the other hand, if your name is Manuel Labor, you have to compete physcially for your job everyday. And just deal with the pain that comes with your job. Wall Street turned violent yesterday, so now there is global unrest.
So, there is no real alternative to renouncing the euro, devaluing the local currency and exporting out of insolvency.
How do you propose that a country in major recession, like Greece, eliminate it’s recession & it’s deficit at the same time?
Hum…I think you misunderstood what is hapenning now, in Greece at least, wages (especially public servant’s) have been cut and the problems lie rather in a (to) brutal austerity package (Which foreseeable dramatic social consequences : http://euobserver.com/851/113841). One solution (you forgot) for the debt crisis is a growing global economy, that implies that fiscally “responsible” governments (France, Germany, Netherlands, US, China etc) stop their irresponsible austerity policy. Another is to help, especially Greece, Ireland and Portugal, by reducing their debt burden and by implementing an IMF and EU led investment Marshall plan. In the end this post fits only, to some extent, the Italian situation, where moral hazard is truly worrying, this might be solved when Berlu is finally (probably next year) outvoted.
It should get interesting considering some nations are currently artifically commodity leveraged with a product that sent Europe into the second world war. You just can’t get all those competeing interests to agree on a single austerity package when so many suffered because of their elders mistakes. Here in the US, we just print/inflate our way out and use any trick in the book to achieve it.
How does the scenario play out if they use the EFSF to recap the banks?
I’d like to see you back this up with at least a sketch of the magnitudes involved. I don’t see how wage reductions and austerity combined with high debt lead to paying down that debt and eventual competitiveness and prosperity. This isn’t diet-for-health, it is rather a starvation diet which runs the risk of killing the patient.
Take the money, lose the nationality. Tell the bankers to go eat it.
http://www.slate.com/articles/health_and_science/medical_examiner/2011/10/bedbugs_how_contagious_are_they_really_.html
Why would the ECB not just allocate 3 trillion Euro to all Euro nations based upon the ESFS quota and then just make loans to one another like the IMF works with SDRs ? Sounds like a simple plan and if the money stays circulating in the banking system as opposed to the real economy would there be inflation ?
It’s time to see some severe austerity from the bankers and bondholders. Why should they be rewarded for their speculative mistakes with record bonuses? How much more should the spirit of the Irish people be crammed down while they are forced to become debt slaves in order to protect bondholders like Goldman Sachs and Rothschild Companies? The world would be a better place without being subjected to the avarice of sociopathic financial engineers.
@ black swan, you nailed it, brother.
§q
Dear Prof. Johnson,
I am dissapointed to see that you subscribe to the prescription of the “internal devaluation” for the euro zone periphery as has been already suggested by your successor as an IMF chief economist Prof. Olivier Blanchard in his infamous article “Adjustment within the Euro. The difficult case of Portugal”, 2006 (although he did not use the term in that article). “Internal devaluation” or a general fall of wages and prices was used to be called ‘deflation’ by economists and was considered a grave disease not a cure for anything.
The problems with such an approach have already been explained thoroughly by J. M. Keynes in his classic article “The Economic Consequences of Mr. Churchill” in 1925.
Seeing things from within as the experiment is being held now in Greece, where I live, I can assure you and your readers that it is not only an economic but also a moral catastrophe as it requires a breach of all kinds of contracts in society, written or tacit. Not only investment is postponed indefinetely and the real household and business debt is increasing as incomes fall, but also unscrupulous people are taking advantage over the moral and prudent ones as the latter are much more hesitant to breach contracts and break promises than the former. On top of that, taxation is now hitting mostly the lower middle class than business.
In all what is happening now is what you have already described on your article The Quiet Coup, although in another context: “Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk—at least until the riots grow too large.” The level of policing in Greece is already at unprecedent levels since the fall of the military Junta in 1974 and this with a government which was elected exactly by the ordinary working folk. So I urge to rethink your approach.
@ It’s time to see some severe austerity from the bankers and bondholders. Why should they be rewarded for their speculative mistakes with record bonuses?
Unfortunitly, possibly while you were asleep, they made a law that says bondholders get paid before everyone else, cops teachers, ect… The only oppotunity we get to address the issue is when the debt limit is to be breached, soon as that passes its game on, again.
And Kostis, we too have a quite coup, its called the law, and he runs rampent over most everything including nature when it suits his purpose. The more you push him, the more he pushes back.
And earle, is that you beatin up on the Koch bros, you know how he feels when one takes away the power of the rock. : > )
I agree with all the commenters who have expressed exrtreme anger and outrage. It’s way overdue for the people to hold the financiers personally accountable for the suffering and hardship inflicted on those they obviously have no regard for. The banksters own world governments, and therefore justice would otherwise be continually subverted.
Would a former Chief Economist of the International Monetary Fund,.who came down on the side of the commoners (against the those he once advised), suffer from some form of cognitive dissonance? We actually have someone on this site who can answer that question, if he is motivated to do so.
The solution to Europe’s debt problems cannot be more debt, especially leveraged, interdependent debt. At the present time, the ‘small’ injections of money allow for fees, bonuses, and year or two of interest, thus prolonging the inevitable. The principal is the taboo subject about which nobody will talk openly. From the financier’s perspective, keeping the financial ‘industry’ (I use the term loosely) healthy is job one. With that goal in mind, the big capital injections are easily understood, in that they are good for the banks and their shareholders, allowing the punishment of those adopting what would otherwise be lucrative short positions. At some point, however, the application of more pecuniary salve to the financial maladies of the debtor nations will fail to be efficacious — then the metastable house of cards will tumble down.
Writing down the debt now to free Ireland, Greece, Latvia, Portugal, Spain, and Italy will be painful for Germany and other lender countries, but this outcome is, to use a Ross-Perot-like metaphor, preferable to keeping the pedal to the floor and the nitrous kit wide open until the motor throws a rod or seizes outright.
Failure to admit that debts must be forgiven in the form of The Big Haircut will only make the lenders that much more outraged when they do finally realize they are holding worthless paper. To some extent, no matter when the defaults occur, there will be some umbrage in the lender community and an attempt to obtain something of tangible worth in recompense, but if the losses are so enormous that they elicit a call to take up arms to get what is perceived to be ‘rightfully theirs’, why then we may have World War III.
The reality is the financial industry has grown too large, and more debt with more interconnectivity is the last thing the productive sectors of the economy need. Manufacturing in the US has gone from 25% to about 10%, while finance has grown so fast I can’t find good numbers to track its meteoric rise from about 4-5% of GDP back in the 1950s to somewhere north of 8% (I am thinking maybe 11-12%, any have the current numbers?). So while we shipping good manufacturing jobs overseas, we focused instead on what we were good at: financial innovation. Did not Goldman Sachs export its mystical debt-hidin’ mojo to Greece so that they, too, could bask in its ghostly light? That legacy is going to leave a mark that will not be soon forgotten.
@Kostis – it is such a savage assault to be inflicting on 10,000 of civilization’s evolution that there can’t be a tolerance of it – what you wrote, “Seeing things from within as the experiment is being held now in Greece, where I live, I can assure you and your readers that it is not only an economic but also a moral catastrophe as it requires a breach of all kinds of contracts in society, written or tacit. Not only investment is postponed indefinetely and the real household and business debt is increasing as incomes fall, but also unscrupulous people are taking advantage over the moral and prudent ones as the latter are much more hesitant to breach contracts and break promises than the former. On top of that, taxation is now hitting mostly the lower middle class than business.”
10,000 years of civilization…sorry for the typo…
Where have we heard this before?
http://www.rawstory.com/rs/2011/10/07/imf-adviser-the-global-economy-could-collapse-in-two-to-three-weeks/
Keith says: “fear is not an option”
Hey….Banksters…..Pssst………your global-ponzi-debt-based-fiat-digital-printing-press-not-worth-the-paper-its’-not-printed- on…..HAS collapsed. Wake the hell up, smell the coffee.
When you clowns realize the gig is up, slit your wrists and do us all a big frikken favor.
@ Woop
Obama (“the bankers’ whore”), for his part, will do everything within his power to ensure that both his and his owners’ (banksters’) gig goes on.
“When I visited the OccupyWallStreet site on Wednesday, it was clear that the disgust with the political system went so deep that there is no single set of demands that can fix a system so fundamentally broken and dysfunctional. One can’t paste-up a regime that is impoverishing the economy, accelerating foreclosures, pushing state and city budgets further into deficit and forcing cuts in social spending.”
“The situation is much like that from Iceland to Greece: Governments no longer represent the people. They represent predatory financial interests that are impoverishing the economy. This is not democracy. It is financial oligarchy. And oligarchies do not give their victims a voice.”
“So the great question is, where do we go from here?”
http://www.counterpunch.org/2011/10/07/obama%E2%80%99s-new-populist-fakery/
Sorry, I trust *Cockburn* and his site about as far as I can throw him.
As far Obama, I would argue these lines, if accurately quoted, represent his real, inner feelings and thoughts. People do utter the truth, even the powerful, on occasion.
Now don’t you go speaking bad about Obama to my 84-year old mom, she would not like it, in the least…: )
First they came for the defined benefit plans,
and I didn’t speak out because I wasn’t in a defined benefit plan.
Then, they came for the manufacturing jobs,
and I didn’t speak out because I wasn’t in a manufacturing job.
Then, they came for the IRA’s and mutual funds,
and I didn’t speak out because I wasn’t in an IRA or a mutual fund.
Then, thousands of people soon millions came for them,
because they were sick of the lies, thievery , murder and wars.
Well, thanks but no thanks.
In a balance sheet recession like this, someone has to pick the tab. And if the state doesn’t pick the tab, as Mr. Johnson suggests, then that means enormous unemployment and a depression.
So, thanks but no thanks.
How about imitating the US system instead, where debt auctions never fail because the primary dealers will always bid, and then the FED is gonna set the interest rate through monetary policy?
How did the Irish elect more bank and bondholder enablers in this last election? In the US, we understand that all national candidates (Paul, Sanders and Kucinich excepted), can not get elected without massive infusions of corporatist cash. Do the same corporatists have their claws in Ireland’s politics?
“How about imitating the US system instead, where debt auctions never fail because the primary dealers will always bid”
You were obviously not caught in the Auction Rate Securities collapse. I got out ten days before the PDs did not show up to bid. Then think about what really caused the “flash crash”. Hint, it wasn’t Wadell and Reed.
Profs. Boone and Johnson ask, “But leaving aside the question of whether the ECB – and the Germans – would ever agree to provide this kind of leverage and ignoring legitimate concerns about the potential impact on inflationary expectations of such measures, could a, for example, 4 trillion euro package really stabilize the situation?” Their answer is a rather conventional “no”: By itself, the 4 tn package might, they concede, buy time, but “really stabilize” requires austerity for the Many. –I’ll offer an unconventional “no,” couched in a rhetorical question for all of you saviors of capitalism: When has capitalism ever “really stabilize(d)”? Does not the historical record show that capitalism’s stable periods are but interludes between instability, just as capitalism’s periods of peace are but periods of gestation of the next war(s)? Those who today proclaim otherwise are usually political reformists and/or sincerely deluded by the Golden Age of U.S. capitalism (post-WWII generation), as if that were the norm for capitalism as a system. (Folks like this talked up how much fun the Titanic was before that accidental iceberg . . . .) Profs. Boone and Johnson are, of course, professional reformists; and it is indeed a sign of the times that even reformists are advocating draconian austerity for the Many–with the promise, of course, that after the pain all will be back to the American Dream as usual. I think not; nor do I see any way out for the denizens of this benighted system. In this regard, the historic failure of socialism (of both the Second and Third Internationals) cannot be overstated. That esteemed harpy of capital (Dame Thatcher) got this much right: There is no alternative, systemically speaking. And, a century ago, Ambrose Bierce got it right when he opined, “Socialism is the true principle of [small-r] republican government. Unfortunately, no people in the world is fit for it.”
Is that what bankster Jaime Dimon’s little $4.5 million “*gift* to the NYPD *foundation* bought….shiny new scooters?
This is a bit irrelevant to your post…but for pete’s sake, are you going to say something about Occupy Wall Street? Isn’t this what you were waiting for? Some real grassroots pushback against the political power of the financial system. I expect you on the frontlines making sure Brown-Kaufman gets resurrected!
@ soloduff: The lord has operated in a similar fashion for well over many millenia. She became discussed with the arab world and simply left them behind to suffer in the sandy desert with basicly no clue. She then convinced Germany they were the chosen people and made them use themselves up physcially and they currently continue to cave in on themselves believeing they still have what it takes to fix the planet, but they overlook themselves mechanically. She then warned America that its citizens would become both needy, greedy, and arrogant and misuse its laws and military machine to aquire whatever power or product they needed in this land of plenty.
As for waiting for something, these obviously are not our best and brightest tools in the tool chest. Most are young and angry at not having enough money for all the things they see in life. They will grow cold and tired before their time and wonder where there relaxation time went to keep them from caving in on themselves. Its not the bending over that became their problem, it was the straightning up again that they gave up on to continue moving forward to their percieved reward. The real grassroots movement has encompassed a full menu of political prowess which will spread world wide with pride. Not quite the pushback todays people want.
I’m not sure how the peripehary can stop accumulating debt with such wide current account deficits. That just seems implausible to me.
Furthermore, say the debt of banks starts to get called into question. What then? That is a much larger market than the sovereign one and the dependence on short term funding has barely decreased in much of the Euro Zone. Secondly, the EFSF is just a giant CDO whose sole purpose is to transfer wealth from the taxpayers to Europe’s banks. It will fail and piss alot of people off. Ultimately what needs to happen is for the stronger countries to leave the Euro Zone, allowing a depreciation, rather than the slow grinding down of wages in the southern countries, which is utltimately the only way that rebalancing can occur under the single currency regime. It is my opinion that Germany is the one most hurting the Euro Zone by demanding its prosperity stays strong at the expense of other nations.
Sadly, this thing will end fast and violently, or slow and painfully.
Peter and Simon above write: “Crisis veterans like to say, quoting former President Ernesto Zedillo of Mexico: When markets overreact, policy needs to overreact in the stabilizing direction. But what really matters is not overreacting; it is making sure you do enough.”
How about DEBT FORGIVENESS for the soon-to-be TRILLION $$$$ student-loan debt bubble, so our young people don’t need to turn to *turning-tricks* to pay off the note?
http://www.alternet.org/story/152657/sex_work_to_pay_off_college_loans_how_the_college_debt_racket_has_left_young_people_desperate_–_and_led_many_to_occupy_wall_st?akid=7680.230705.Vv5cuE&rd=1&t=2
Young people seeking higher education placed trust in the very system that actively sought to undermine (trillions of investment $$$$ to China, for example) and now that system owes an apology
to these disenfranchised occupiers of wall street.
The NYPD doesn’t need to be made whole, with bribes thinly disguised as *contributions*, but our future does.
The Germans see this pathetic scam, for what it is, but they can’t talk about, or they go to prison.
Too bad the German government are total suck-ups to the big money.
Usually, at least as the stats indicate, I am 70% more prophetic than the prophets. So shouldn’t that be something of interest to maniacs seeking to rule the world through pen on paper and fractals?
The only time I can confirm having inspired 3 men to join forces to make an idea of mine a reality while I was sleeping was when we (4 scientists) were all renting a tired old Victorian house close to where we were working on a project. I had commented that it would be great if I could operate from my bed the toaster and rig up a delivery system up the 4 flights of stairs to the top floor of my apartment – breakfast in bed – ah, nice. Heard a polite tap on my door on Saturday morning and when I opened the door, a piece of toast attached with a clothes pin to a string slapped me in the face. LOL. The guys had scoured the house for all possible items to be used and made due with what they found. The really fun part was following the string back down the flights of stairs – always wish I had taken photos. All 3 guys and I are still at adding to the American Experience in ways that make USA who we REALLY are. They don’t like what was done to ME, personally, owen owens. You can bet your 100 mil on the FACT that maggot capitalists aren’t going to get a second shot.
Constitutional Convention to draft an ENERGY policy.
BURN THE PATRIOT ACT.
CAN THE “EUROZONE” REALLY BE SEPARATED FROM THE AMERICAN DOMAIN AND THE TOTAL SYSTEMIC FALLACY? GREAT SUMMARY ARTICLE BUT KEEP THIS IN MIND:
http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=7412
October 7, 2011
Occupy Wall St. to a Bank in the Public Interest
Michael Hudson: A public option in banking will be a structural answer to the power of finance
WE ARE NOT FACING MERE “DEREGULATORY” FAILURE; WE ARE FACING DECRIMINALIZATION OF FRAUD!
Europe will always do the right thing, but only after nearly… sigh, who am I kidding.
Not only does what you suggest make sense – the G7 countries have been living beyond their means for two decades at least – but it is ultimately inevitable. There is going to be a substantial decline in living standards since the means to support current levels are now depleted. The argument about moral contracts or, as we say in French, les avantages acquises, is of course fraudulent. The Soviet workers had a whole series of guarantees – when the Soviet system collapsed, these proved to be cheques drawn on a bankrupt bank.
The problem is how to implement these changes within a nominally democratic system. The willingness to make sacrifices is conspicuous for its absence – and everyone quite reasonably thinks that whoever is situated immediately above them on the incomes totem pole should pay the price. We can expect bad and ultimately counterproductive policy as governments stretch to continue the game until just past the next election. Perhaps Europe might benefit from a closer examination of the political systems of some of the BRICs countries – some of which show a striking ability to implement unpopular-but-necessary policies.
@Woych – WE ARE NOT FACING MERE “DEREGULATORY” FAILURE; WE ARE FACING DECRIMINALIZATION OF FRAUD!
Yup, psycho heaven – bankster capitalism from lalaland and maggot capitalism from emerging countries. Capitalists never funded Mother Teresa….
From News Hour, “MARK SHIELDS: Since the crisis of 2008, every major — every reporting trip tells you two things. There are two targets of rage that American voters feel: Washington, D.C., and Wall Street.
The Tea Party addressed Washington, D.C. It didn’t lay a hand on Wall Street, and nor has either party. Certainly, the Republicans haven’t. The Democrats have taken limited measures. But that is sitting there. These are the people who were the architects and the engineers of the financial crisis, with their exotic, erotic, whatever they were, self-financing, and self-prospering instruments that nobody else understood.
They have made nothing. They have contributed nothing to the country. They made deals for themselves. And once they got in trouble, they turned to firefighters and nurses and waitresses and small business people to bail them out.”
Sauerkraut thinks that is admirable in the BRIC countries that they have a “….STRIKING ability to implement unpopular-but-necessary policies…” Sure it’s been penned on to paper…
@Anonymous. You raise a good question when you wonder, “…but for pete’s sake, are you going to say something about Occupy Wall Street? . . . . Some real grassroots pushback . . . . I expect you on the frontlines making sure Brown-Kaufman gets resurrected!” Serendipitously, the poster “owen owens,” in replying to my post, replies, I think, to your question. (I say, “I think,” since owen owens has a rather oracular style.) Your question turns upon the political potential of the Occupy Wall Street development. Says owen owens: “Most are young and angry at not having enough money for all the things they see in life.” –I interpret this as stating that most in the current manifestations are protesting against the perceived failure, present and prospective, of the American Dream. If this is the case, then I predict that the Occupy Wall Street movement will fizzle out in a year or less. Why? Ponder what the American Dream means: Not getting ahead by hard and decent work (as in the usual meritocratic construction) but getting ahead by capitalistic means, within the capitalistic system, playing by capitalism’s rules. To put the matter even less generously, the promise of the American Dream is successful egoism for all–a variety of “identification with the aggressor,” in the jargon of social psychology–or, even more succinctly, Consumerism. If this is indeed the gripe of most of the Occupy Wall Street folks, then (a) theirs is not a movement worth having and (b) their movement will dissipate in either exhausted despair or the usual channels of discontent in late capitalism, namely (i) reformism (lesser evil cum false hopes, such as Brown-Kaufman, which will never be enacted this side of a mass socialist movement, which (anent Ambrose Bierce) is not in America’s future); or (ii) petite-bourgeois radicalism of the Tea Party sort, i.e., of the protofascist sort that is ever the reliable reserve army of insanity for mature capitalism in crisis. (Thus I do not share owen owens’ prophecy of a humanly worthwhile “real grassroots movement” in contradistinction to the Occupy Wall Street movement.) –Of course I hope that you, Anonymous, are right and I am wrong. But if I have learned anything in my long life, it is, as they say on the Maine coast, “You can’t get there from here”–“there” signifying the socialism referenced in my post (per Bierce), “here” signifying any movement longing for the American Dream. The Buddha learned 2500 years ago that he had to leave his palace in order even to seek enlightenment; American Dreaming is the precise opposite, and “works” only for those unable to awaken. (Do you recall that as long as the American Dream/Consumerism paid off–in that Golden Age of postwar-II capitalism–most of the Dreamers were blithely indifferent to the nightmare that this Dream brought to to much of the rest of the world? This little circumstance told me much of the moral and intellectual fitness of the American public for anything of substantial human worth . . . .)
@soloduff
Seriously? You’ve got a statistical and scientific case for the *Dreamers* being the ONLY cause of the misery in the rest of the world? Did it hurt you bad to do business with *Dreamers*? Didn’t make a trillion $$$$ fortune off of it? Bummer.
Well allrighty then, how about trying out a really stupid idea since we’ve exhausted all the genius ideas…?
That should be good for international relations. Everyone can relate.
I just got back from counting all the stars I saw in the sky – that is how much I just created of FIAT $$$ for myself. This is now Planet Annie and you are all my prisoners.
4 billion of you will not have any jobs tomorrow….and 144,000 of us will go to the Mansion Worlds to live forever…. That’s the genius plan.
Kinda hard to find something stupider, but we certainly should try.
It’s got a nice ring, Planet Annie. :)
@woop – those *scooters* don’t look like NYPD to me – just sayin’…NYPD do not use those kind of tactics for crowd control when there is no damage being done to property and no violent threat exists (ie. gang fight).
It’s NOT a riot that they’re trying to subdue! wtf?!
Not good – it’s the persistent and peaceful protesting youth that NYPD should be protecting…
upside down world….
It’s crazy, Annie….absolutely upside down.
I also saw a photo of a uniformed cop-like creature, and if he didn’t look like an alien reptilian life form, he certainly looked like one of the more sinister imports from Ubetchastan.
Yeah, the scooters looked like something out a Fellini movie to me, too.
OWS needs SPECIFIC demands:
1. forgiveness of student ($ 1 trillion) debt;
2. nationalize the Fed;
3. Tobin tax on all Wall Street transactions;
4. a starter tranche of $ 1trillion credit line to states for infrastructure projects;
5. immediate end to foreclosure and fraudclosures;
So far, this looks like a cultural or social movement, and without specific, programmatic objectives, this phenomenon will lose all traction and disintegrate into complete irrelevance.
These consensus builders in the steering committee and the general assembly don’t have much time.
You build something lasting by connecting to people who need specific solutions, and you can’t do this with amorphous and vague language.
@Anonymous – Not to be argumentative :-))
But I’d be zooming in on the badge numbers….not NYPD tactics! Think about all the street festivals, and parades, and marches – something every day and every hour in NYC – take a look at the attached video again – look at how relaxed the lone cop is leaning on the barricade – if the *scooters* were LEGIT, he would have been receiving a message that a change in tactics is underway – actually HE would have been the one calling for back up as he was on the scene! This private army crap is getting on my nerves, as a taxpayer…
I believe that we have a generational clash – the Millenials would rather try and unzip out of their own skin rather than make a *list* to hand over to the Gen X sociopath technocrats….
as the song goes, “there is no POLITICAL solution to our troubled evolution”
This is a LABOR movement.
Nice try, though….only 5 *demands* :-)
Being as this is a Labor Movement, you got 2 choices – either harness the energy for something constructive, or it’s a horrible utterly SAVAGE nihilistic POLITICAL *ism* War…Psycho Heaven.
Now, I get that a perpetual motion SAVAGE War is good for the MIC’s bottom line –
but because their booty has been taking from the citizen’s, themselves, since the passage of the Patriot Act when the APPOINTED, or more like *annointed*, Secretary of the Treasury bypassed the 3rd power sharing channel of the Supreme Court to rip open ECONOMIC privacy protection – talk about identity theft on STEROIDS…..
but it’s not good for the bottom-line of the Empire that stood up such a military might – like DUH.
This whole story is so NOT the *American Experience*. This is Jim Jones-ing the Planet and 7 billion people who belong to the Human Species – white, black, yellow, red and purple with pink polka dots – hey, wha’ever :-))!
Is there a PLAN for beating the swords back into ploughshares???!!! Hearing “No” as the answer means you GET OFF the political stage.
Annie you so unkind, I can’t quite nail down what it was I wanted you to hear. Is that why your jr high friends kept the book of life from you, and instead steered you to the large overly technechical Urantia maze. Birds of different feathers — do not flock together, and so they see life differently. I sense you are down to your last nerve, and yes, I apparently am getting on it, but thats better than getting into a fight at say, Mcdonalds? I mean what would Ronald think??
@owen owens
The fact that you are free to roam the planet to HATE everyone you meet is the only proof necessary that The Patriot Act is a complete failure.
I never met a modern *religionist* who was SANE.
You declared the war on ME, remember? I should show you *kindness*? Desperate, aren’t you?
Not so easy to crucify 4 billion innocent souls, is it?
@owen owens – I did not attend a Junior High School, sorry BOGUS information – we all LIE on the internet.
And I’m not the one who is HYSTERICAL about censoring ANY BOOK. In case you haven’t noticed, Vampirism is the lastest fashion trend. Comparing the information in the Urantia Book with Vampire Literature, what argument is there for the censorship of Urantia Book? Where’s the moral high ground to burn the Book?
@owen owens – I kept the declaration of war:
Owen Owens from Baseline Scenario:
“…And I didn’t like it anymore than you did, and my future spending will only make it worse (for her)….”
want the whole thread? maybe Kwak can legally erase it for you from this board….? Go ahead, spend some of your 100 mil….
No one invested a decade ago in what was *too hard to do*. So go ahead, keep spending to make it worse….
You are NOT QUALIFIED to judge me – you are NOT a peer. We all LIE on the internet. And judging from the quality of data for analysis of the facts on the ground that is being manufactured by modern technology, you haven’t got a CLUE. Which is just how We the People want it – YOU, clueless.
Ahh, mulitiple bombardments of insanity to confuse a weary hunter. Simply because your team has not met or so much as seen a real sane person, does not mean an association does not exist. And turning back time to suit your arguements is futal, that moment is long gone, let it go, and move on. Shortness is the way home girls, the others are an everlasting prick and pain. As for lieing, speak for yourself, no one proclaims their innocents, so loudly as the guilty. Thats all I hear from your party.
@ Annie, your point about PRIVATE MERCS and PRIVATE SECURITY is well-taken, and not lost among readers keeping pace with developments.
Sometimes, it takes time for me to understand your meaning, so please always bear with me.
I did manage a screen grab of a machine looking like those seen in the vid, however, with NYPD decal, and the same white stripe helmut.
Be that as it may, as you have pointed out, the DRUG $$$$ goes a long way in the protection *bidness*.
These are GREEN TECHNOLOGY VECTRIX scooters, per this link:
http://nyscooterclub.com/forum/viewtopic.php?f=1&t=14417&view=next
http://www.huffingtonpost.com/2011/08/24/nypd-cia-terrorism_n_934923.html
It’s not a *development*, Woop, it’s follow the bouncing ball of *technology* from Silicone Valley (internet) to biggest heist ever pulled off….
Dig out the Washington Post investigation of the massive apparatus constructed in Virginia after the Patriot Act – it’s all EXTRACTION.
This is already written in the history books – this massive heist of the fruits of labor to destroy a political *enemy* (them vs us) will be forever compared to Stalin (NOT a Russian, btw, by race) purging his country of *political* enemies in a war-weary Russian population. Blow up a person’s HOME to snap the photo of the moment of horror and rage on their faces and present that photo as EVIDENCE that they are an animal.
I stand by my assessment of SAVAGERY – congolese mercenary savagery – waiting in the bushes until the harvest is picked, then swoop in and kill them all.
Psycho Heaven is in full-on construction mode….
There was no call from the cops on the street for back up – it was a pre-emptive scooter raid.
Psycho Heaven…
Annie: we have…like zero… fundamental disagreements, especially re: SAVAGERY, what happened in Russia, and TODAY hiding all of it under the cloak of “preventing another terrorist attack.”
The WAPO piece aimed at chilling speech, imo, also.
No disclosure possible without someone high-up following strategic directive.
It’s Murder Inc, all over again….indeed.
Olive harvest time….
http://www.presstv.ir/detail/203714.html