Posts Tagged ‘Greece’

[#98.2] #Grexit or #Greecapitulation?

Posted: 2015/07/25 by Punkonomics (@dearbalak) in Podcasts
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To download, right-click and select “Save link as…” PUNKONOMICS 7-8 PT.1

Steve Bell 18.05.2012

[#98.1] #Grexit or #Greecapitulation?

Posted: 2015/07/25 by Punkonomics (@dearbalak) in Podcasts
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To download, right-click and select “Save link as…” PUNKONOMICS 7-8 PT.1


This Is Why The Euro Is Finished | Zero Hedge

Posted: 2015/07/05 by Punkonomics (@dearbalak) in Links/Articles/Video
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Look, it’s simple, the euro is finished. It won’t survive the unmitigated scandal that Greece has become. Greece is not the victim of its own profligacy, it’s the victim of a structure that makes it possible to unload the losses of the big countries’ failing financial systems onto the shoulders of the smaller. There’s no way Greece could win.

via An Ancient Civics Lesson –

ANCIENT Greek and Roman politics rested on a conundrum. Lest they undermine social peace, the poor could not routinely threaten the lives or property of the rich. But unless the laws were fair enough to the poor, why should the plebs respect them?

Greeks and Romans addressed this challenge — one that we continue to face — with three distinct models. Athenian democracy empowered the poor, while employing the rich to serve; Roman republicanism empowered the rich, while building in special protections for the poor; and the political theory of Aristotle imagined a new politics of what he called the “middling” class.

In full flower in the fifth century B.C., the Athenian democracy enfranchised all male citizens without requiring any wealth qualification (though slaves were excluded from political participation altogether). This created a majority who were poor — “the many,” as opposed to a small elite, “the few.” Who were the many? By some reckonings, they were 90 to 95 percent of adult citizens, all those who had to work for a living; by others, they were the two-thirds who lacked the means to qualify for elite military status.

As an anonymous writer at the time observed, the poor majority perfected a way of wielding its power by making use of the power of the rich. On one hand, the poor often elected the wealthy to key offices and followed their advice in the assembly; on the other hand, they used their collective power in the assembly, juries and executive council to restrain the wealthy and rein in corruption. And so the poor majority asserted ultimate control over the elites, even while allowing them considerable influence.

The Roman poor fought more of a rear-guard action. Roman republican politics expected the rich to hold sway in the offices and also in the Senate. Technically, the popular assemblies dominated by the poor majority had the sole power to approve all laws. Yet in other kinds of assembly, citizens voted by property class, starting with the richest groups, who sometimes decided the issue before the poorer groups got to cast their votes.

The balance between rich and poor in Rome was unstable. In 494 B.C., for example, the poor were so burdened by debts that they effectively went on strike: They put down the tools of their labor and absented themselves from the spaces under elite control. By seceding from the city, they forced the establishment of a new political institution: tribunes, whom the plebs would elect to defend their interests. Among their powers, the tribunes could veto proposed senatorial measures and provide a safe haven for those who were threatened or abused by members of the elite in the markets or on the streets.

Today, this model might inspire giving a panel of “lottery-selected, nonwealthy citizens” a set of powers to intervene in and check federal proceedings, as the political theorist John P. McCormick has proposed. As Roman tribunes had the power to veto Senate decisions, so modern tribunes could have the power to cast a certain number of legislative vetoes each year. Another kind of modern tribune would be ombudsmen to whom the poor could appeal against routine bureaucratic indignities, as the Roman poor were protected by a tribune’s “sacrosanct” physical presence.

What if we were to abandon Athenian and Roman models of managing class conflict, in favor of a promised land in which virtually everyone was middle class? That model has an ancient pedigree too, but, tellingly, it is found only in philosophy, not in Greek or Roman history. In his “Politics,” Aristotle imagined what he called a “middling” regime that would cultivate and expand a group of citizens who were neither rich nor poor, instead being “equals and similar,” and make them the political center of gravity.

Middling dominance would require making it impossible for the rich to use their money to buy special political power. At the same time, it would marginalize the poor, who would no longer make up a numerical majority. The philosopher called this “middling” model “the best constitution for most states and the best life for most men,” even though his highest ideal was a regime in which all citizens would be leisured, relying on noncitizen artisans, farmers and slaves to do the dirty work.

Yet a modern regime based on this Aristotelian “middling” model would be less congenial to both left and right than either might imagine. It would have to tax the rich drastically in order to reduce their social and political power, while at the same time reining in support for the poor, in order to keep the balance squarely away from each extreme. In the end, the Aristotelian “middling” model is no less a recipe for class dominance than the Athenian or Roman regimes, and it, too, would most likely require the services of a permanent underclass.

This range of ancient options suggests that it is pointless to imagine a politics in which no class is dominant or one in which the interests of different classes don’t sometimes conflict. History and philosophy alike counsel that the most practical course is to moderate class conflict, not by pretending it away, but through the self-assertion of the weaker classes and institutionalized recognition of their interests.

Class warfare in Europe is getting ugly #noausterity

Posted: 2015/03/18 by Punkonomics (@dearbalak) in Links/Articles/Video
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via Costas Lapavitsas: The Syriza strategy has come to an end.

Tariq Ali said about this development:

The Troika decided today to debar Greece from going ahead with its anti-poverty projects. The Euro-elite is determined to use its economic muscle to humiliate Syriza politically. The response can only be to fight back, taking the people into confidence and a referendum. But till then capital outflows have to be stopped. Costas’ interview is very strong. There is no alternative left and capitulation must be unacceptable to a large majority of the base and one presumes the leadership.


via Reading the Greek Deal Correctly | Common Dreams | Breaking News & Views for the Progressive Community.

OP-ED in the NYT by Yanis Varoufakis (badass, economist, and the new finance minister of Greece)

ATHENS — I am writing this piece on the margins of a crucial negotiation with my country’s creditors — a negotiation the result of which may mark a generation, and even prove a turning point for Europe’s unfolding experiment with monetary union.

Game theorists analyze negotiations as if they were split-a-pie games involving selfish players. Because I spent many years during my previous life as an academic researching game theory, some commentators rushed to presume that as Greece’s new finance minister I was busily devising bluffs, stratagems and outside options, struggling to improve upon a weak hand.

Nothing could be further from the truth.

If anything, my game-theory background convinced me that it would be pure folly to think of the current deliberations between Greece and our partners as a bargaining game to be won or lost via bluffs and tactical subterfuge.

The trouble with game theory, as I used to tell my students, is that it takes for granted the players’ motives. In poker or blackjack this assumption is unproblematic. But in the current deliberations between our European partners and Greece’s new government, the whole point is to forge new motives. To fashion a fresh mind-set that transcends national divides, dissolves the creditor-debtor distinction in favor of a pan-European perspective, and places the common European good above petty politics, dogma that proves toxic if universalized, and an us-versus-them mind-set.

As finance minister of a small, fiscally stressed nation lacking its own central bank and seen by many of our partners as a problem debtor, I am convinced that we have one option only: to shun any temptation to treat this pivotal moment as an experiment in strategizing and, instead, to present honestly the facts concerning Greece’s social economy, table our proposals for regrowing Greece, explain why these are in Europe’s interest, and reveal the red lines beyond which logic and duty prevent us from going.

The great difference between this government and previous Greek governments is twofold: We are determined to clash with mighty vested interests in order to reboot Greece and gain our partners’ trust. We are also determined not to be treated as a debt colony that should suffer what it must. The principle of the greatest austerity for the most depressed economy would be quaint if it did not cause so much unnecessary suffering.

I am often asked: What if the only way you can secure funding is to cross your red lines and accept measures that you consider to be part of the problem, rather than of its solution? Faithful to the principle that I have no right to bluff, my answer is: The lines that we have presented as red will not be crossed. Otherwise, they would not be truly red, but merely a bluff.

But what if this brings your people much pain? I am asked. Surely you must be bluffing.

The problem with this line of argument is that it presumes, along with game theory, that we live in a tyranny of consequences. That there are no circumstances when we must do what is right not as a strategy but simply because it is … right.

Against such cynicism the new Greek government will innovate. We shall desist, whatever the consequences, from deals that are wrong for Greece and wrong for Europe. The “extend and pretend” game that began after Greece’s public debt became unserviceable in 2010 will end. No more loans — not until we have a credible plan for growing the economy in order to repay those loans, help the middle class get back on its feet and address the hideous humanitarian crisis. No more “reform” programs that target poor pensioners and family-owned pharmacies while leaving large-scale corruption untouched.

Our government is not asking our partners for a way out of repaying our debts. We are asking for a few months of financial stability that will allow us to embark upon the task of reforms that the broad Greek population can own and support, so we can bring back growth and end our inability to pay our dues.

One may think that this retreat from game theory is motivated by some radical-left agenda. Not so. The major influence here is Immanuel Kant, the German philosopher who taught us that the rational and the free escape the empire of expediency by doing what is right.

How do we know that our modest policy agenda, which constitutes our red line, is right in Kant’s terms? We know by looking into the eyes of the hungry in the streets of our cities or contemplating our stressed middle class, or considering the interests of hard-working people in every European village and city within our monetary union. After all, Europe will only regain its soul when it regains the people’s trust by putting their interests center-stage.

NOTE: This chart is not from the NYT OP-ED

NOTE: This chart is not from the NYT OP-ED