Greece: Island Of Democracy.

by Jerry Alatalo

DrachmaReading articles on the situation in Greece has led to looking at possible connections between a Citigroup-written Dodd-Frank-rollback provision snuck into the December 2014 “Cromnibus”, must-pass spending bill in the United States Congress – and how Greece ran up its debt. Could it be that Citigroup and other Wall Street megabanks placed huge derivatives bets on Greece continuing to pay its creditors, saw the rise of Syriza in Greece and a strong possibility the party would win the January 2015 Greek election, and that Syriza would fight further austerity to the point of default?

Who knows what top managers at Citigroup were thinking when they arranged for members of the US Congress to insert Citigroup’s derivatives/swaps bailout provision in the spending bill. Maybe the move was specifically in response to political developments in Greece and large “bets” which had the real chance of losing Citigroup and others great sums of money. Maybe the provisions became inserted because of growing awareness by Wall Street of imminent changes in the world’s finance/banking system, and coming monumental losses from losing “bets” on derivatives contracts. No matter the real reasons, some estimates of global derivatives totals include the word quadrillion – one thousand trillion.

What the specific reasons for Citigroup, its lobbyists in Washington, and collaborative (colluding?) members of Congress were for successfully inserting the derivatives provisions can only become known by the American people through asking those individuals responsible for getting it passed into law. At any rate, it’s interesting to go back to December 11, 2014 and listen to Senator Elizabeth Warren, unsuccessfully, try to keep the provision out of the spending bill.

The Citigroup provision passed in December 2014 specifically takes aim at Dodd-Frank legislation having to do with “Prohibition of government bailouts of swaps entities”.

Here’s some of what Senator Warren said before the vote on “Cromnibus” in December 2014:

“If big Wall Street banks want to gamble with their own money and live with the consequences of those risks, that’s how markets are supposed to work. But they shouldn’t get to gamble with government insured money and they shouldn’t get to run up to the government when the deal goes sour”.

“House Republicans are moving quickly to try to jam this bill through today before their own members have had a chance to digest this Wall Street bailout provision”.

Ms. Warren pointed out that a “fact sheet” on the provision was intentionally confusing, written to obfuscate, and designed for diverting attention so to increase the odds of passage.

“A vote for this bill is a vote for future taxpayer bailouts of Wall Street. When the next bailout comes, a lot of people will look back to this vote to see who was responsible for putting the government back on the hook to bail out Wall Street”.

“This fight isn’t about conservatives or liberals; it’s not about Democrats or Republicans. It’s about money and it’s about power right here in Washington. This legal change could trigger more taxpayer bailouts and could ultimately threaten our entire economy, but it will also make a lot of money for Wall Street banks. This change will be a huge boon to just a handful of our biggest banks – Citigroup, JP Morgan, Bank of America…”

“The American people sent us here – Republicans, Democrats and Independents – they sent us here to stand up for them, to stand up for taxpayers, to protect the economy. I urge my Republican colleagues in the House to withhold their support from this package until this risky giveaway is removed from the legislation. It is time for all of us to stand up and fight!”

Members of Congress weren’t convinced by Elizabeth Warren, the Cromnibus spending bill passed along with the Citigroup provision. If Wall Street banks lose big money on derivatives/swaps bets, the American people will become forced to bail them out.

(Thank you to Senator Elizabeth Warren at YouTube)

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That December 2014 event is interesting to consider in contrast to what economist Michael Hudson said recently on the situation in Greece.

“At the G8 meetings in 2011, President Obama went over along with Tim Geithner (then Treasury Secretary) and said ‘our big campaign contributors are on Wall Street, and they’ve made huge bets that Greece could pay’. If Greece doesn’t pay then these gamblers and derivatives players are going to lose their bets. You’ve got to sacrifice Greece, and you’ve got to drive it into poverty, and lend the Greek government the money to pay the bondholders so our Wall Street banks won’t lose money”.

“So the European Central Bank told the International Monetary Fund (IMF), ‘if you want to be a player you’ve got to ignore what the staff said’, and they did. (The IMF staff had determined Greece was unable to pay back more loans) The European Central Bank, the IMF paid over $100 billion euros to the bondholders, so Greece, instead of owing private bondholders, they owed the IMF and European Central Bank. Now the European Central Bank wants to get paid, but the debts can’t be paid”.

“So the European Central Bank says, ‘Ok, Greece. Sell us your islands, sell us your ports, sell us your land, sell us your raw materials… This is foreclosure time, and if you can’t pay we want everything in the public domain. And you also have to impose austerity. You only have a 60% unemployment rate for youth. You’ve got to increase the unemployment rate to 80%, double the emigration, in order for us to make the loans to your government – that will turn right around to pay us!’

“It’s either austerity or we will ‘smash and grab’. Take your pick”.

Bill Black added:

“…Crony capitalism. You can’t keep a country – at least there’s no economically rational basis for doing so, and of course it’s completely inhumane – to keep a country in a condition where it constantly will be in ever-greater debt. And that’s precisely what the Troika wants to do, and as Michael said, German politicians have openly demanded that Greece begins selling islands. In other words, selling the nation. Just a complete disruption of sovereignty”. 

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(Thank you to TheRealNews at YouTube)

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Greece’s Prime Minister Alexis Tsipras was recently quoted as saying:

“My personal view is that their plan is not to push Greece out of the Euro zone. Their plan is to end hope that there can be a different kind of policy in Europe”.

Greece missed the June 30 deadline on its $1.6 billion payment. Has anyone seen those 85 people who own as much wealth as half the world’s population? If anyone does see them, ask them if they could “pass the hat” for the birthplace of democracy. If you think that’s going to happen, I’ve got some islands in Greece to sell you…

Ukrainians Face Harsh Austerity.

Posted on February 15, 2015

by Jerry Alatalo

mountain3Alphabet While Ukrainians pray that the recent Minsk ceasefire agreement holds and finally ends the war in their country, economist Michael Hudson feels that the International Monetary Fund (IMF), not Russia, may entail Ukrainians’ greatest threat.

In the days, weeks and months ahead, people will wonder how long before the anti-austerity movement lit by Greece after electing Syriza and new Prime Minister Alexis Tsipras to power will reach the men and women of Ukraine. One can only feel compassion for Ukraine’s 40 million ordinary people who have had to endure the unnecessary stress, violence and hardship in their country since the violent coup of February 2014.

An agreement was arrived at and signed by ousted President Viktor Yanukovych, leaders of the Maidan opposition and European Union representatives for power sharing, amendments to the constitution, and a nationwide election only days before sniper fire killed dozens of citizen-protesters and Ukraine police officers. It was that extreme violence, where even today the murderers have yet to become found, prosecuted, convicted, and imprisoned, which led to Yanukovych fleeing for his life to Russia, a new administration, and multi-billion euro loan contracts between the Ukrainian government and the IMF.

The residents of Crimea voted to leave Ukraine to become part of Russia, and people in the south and east of the country raised strong opposition to the new Kiev government, held referendums for more autonomy and independence, received the label of “terrorists”; civil war in Ukraine since then has resulted in over 5,000 people perishing, over one million Ukrainians becoming internally displaced or leaving the country for sanctuary from the war to Russia, and, besides the highly stressful events experienced by average Ukrainian people, become the concern of world leaders, experts and academicians worldwide.

Given the record-setting amount of media propaganda related to Ukraine’s crisis since February 2014’s coup, one can be reasonably certain that new journalism textbooks will include the reporting on Ukraine over the past year as a major case study – of journalistic failure. Fortunately, people around the world have access to independent alternative media on the internet to cut past corporate mainstream media lies, obfuscation, and false narratives about the Ukraine crisis.

Because of that access to the truth, one can predict that Ukrainians will be showing up on the Maidan in Kiev very soon, and perhaps in even greater numbers than February 2014, calling for an end to harsh austerity measures enforced by the IMF, European Union and others who’ve arranged for Ukraine’s government to sign on to multi-billion euro loans with legalese changing the political, economic and social conditions of the country in a big way.

Professor of economics Michael Hudson views the austerity framework Ukrainians are facing as a “1-2 punch” to them by the IMF neoliberalism-producing loans, which, in the eyes of Mr. Hudson, can never be repaid. Regulations which prohibited the sale of Ukraine’s vast, rich farmland to foreign interests have been changed to allow multinational agribusiness giants like Monsanto to buy large tracts of farm acreage. Professor Hudson sees the austerity-inducing changes mandated by loan legal language – including the selloff of public assets by the government to repay debt, cuts to pensions, public sector jobs, etc. – as “financial warfare”.

He talks about how 38% of Ukraine’s exports were purchased/going to Russia, and how the Kiev-directed military assault on eastern Ukraine bombed coal-producing plants and electricity-producing plants “out of existence”. He questions the IMF loans, referring to the financial institution’s rules against loaning to countries involved in a war and/or insolvent. He notes that billionaire George Soros has suggested the west arrange for $50 billion for Ukraine.

What has occurred in the last year in Ukraine can only be described as horrific, on many levels. May the peace agreement work for the sake of all the men, women and children of Ukraine. Tremendous, unnecessary damage has been unleashed in that country; the road to recovery is going to be long and difficult, and the least world leaders can do is try their best to stop the violence.

War is the last thing the Ukrainian people need with all the extreme difficulties they are facing.

Living in Ukraine, the “breadbasket of Europe”, people there have an undeniably very “long row to hoe”.

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(Thank you to TheRealNews at YouTube)