Wednesday, August 1, 2012

Europe, catastrophe in the making

By: Rodney Shakespeare

Source: Press TV

Europe is a catastrophe in the making. Yet the nearer it gets the more they tell us it will never happen. “We know what we’re doing, the next European summit will sort things out,” they say. “Only a few more years of austerity, maybe ten or fifteen, and we’ll be over the worst,” they predict. “It’s all the fault of everybody else,” they smile.

Since it’s everybody else’s fault but their own, they carry on as before, or rather, as before but making things worse. Thus, faced with an overall unemployment level of 11% and over 20% for young people, their ‘solution’ is to increase unemployment. Observing that overall debt levels are such (Euro government debt averages over 100% of GDP) that the debt has become un-repayable; they say that ‘More Debt is a Good Idea.’

Getting nicely warmed up, they advise on the importance of selling off assets, anything from a national telecoms company to an island, carefully hiding the fact that the only people to benefit from the selling will be themselves.

They then shout ‘End Welfare in All Forms,’ although they do not yet say out loud what they mean, namely, that the poor do not deserve to live.

Money creation, moreover, must only be for the benefit of the banks and never for the benefit of the population as a whole. Finally, they proclaim there is a need to ‘End National Sovereignty,’ because that will enable them to smash all resistance and achieve their undeclared but underlying aim to control everybody still alive in the simplest, yet most powerful of ways by turning them into debt peons for ever.

Who are ‘they’? They are the elite of bankers and the bribed, complacent politicians, aided by servile academics, who uphold the power of the banks because they think that it will increase their own. They are now nicely in control and are anxious to move things on. Thus Jean-Claude Juncker says there is no time to lose and the European Central Bank must use all means at its disposal. By this he means a large-scale money creation for the benefit of elite and the banks which will reap the rewards of cheap money being lent at high interest as well as the benefits of the ownership of rising asset prices.

In contrast, the mass of the population will experience fewer jobs, lower pensions, diminished welfare and increased inflation. Above all, the new flush of money will be created as a debt to be repaid by the suffering people.

Some of the elite put things differently. Thus Robert Zoellick, former President of the World Bank, talks about ‘structural reforms’ but that still means unemployment, increased debt and less welfare except on a larger scale than anybody else proposes. These people are monsters.

Nor are these proposals confined to Europe. The UK (in Europe but not in the Euro) and Japan have egregious levels of overall debt (government, private and corporation) which are so bad that Max Keiser (economic analyst of Press TV) thinks that the UK and Japan will be destroyed by the elite before it manages to do the same for Europe.

Keiser says we are being stampeded into accepting the money-printing so as to recapitalise bankrupt banks which will become fabulously wealthy whilst the people are impoverished. In the race to be destroyed, between the UK and Japan, or Europe (with the International Monetary Fund, the European Central Bank and the European Union doing the destroying) one thing is for certain, it will be a close run thing.

In all the negativity, the inability to think anew and the hatred of ordinary people, we are experiencing a re-run of 1929 and the early 1930s and are failing to imprison the bankers, failing to devalue (which, in practice, is prevented by the structure of the Euro but is essential for countries like Greece), failing to investigate (as the US did with the Pecora Commission) and failing to implement a Glass Steagall Act.

Above all, we are failing to open up a supply of interest-free loan money from our national banks for small farms and businesses, for public capital works such as roads, bridges and waterworks, and for new forms of clean energy generation.

And the failure matters. China, India and Brazil are now in trouble and the US is dipping into recession. Soon it won’t be 2008 again, it will be 1931. Spanish unemployment is 25% overall and 53% for young people; that’s a taste of what is to come. Needless to say, welfare support for the unemployed is being slashed. The Spanish regions will soon be in revolt. And don’t forget what is happening in Greece and the misery of Ireland.

The problem is not any one country; it’s all of them with the weakness in one country preventing exports by another: with the debt of one country weakening, even bankrupting another; with the seeping away of confidence crossing borders and undermining trade like some vast smelly flood.

Where the coming catastrophe is concerned, it does not matter if the UK is in or out of the Euro and a brave Spanish economist (Lorenzo Bernaldo de Quiros) has already proposed that Spain withdraw. In or out they are all going to get caught one way or another.

A European diplomat has said, “For two years we've been pumping up the life raft, taking decisions that fill it with just enough air to keep it afloat even though it has a leak, but now the leak has got so big that we can't pump air into the raft quickly enough to keep it afloat."

"In nearly 20 years of dealing with EU issues, I've never known a state of affairs like we are in now," he continued. "It really is a very, very difficult fix and it's far from certain that we'll be able to find the right way out of it."
Rodney Shakespeare: A Visiting Professor of Binary Economics at Trisakti University, Jakarta, Indonesia, Rodney Shakespeare is a Cambridge MA, a qualified UK Barrister, a co-founder of the Global Justice Movement, a member of the Christian Council for Monetary Justice. His main website is Shakespeare is also Chair of the Committee Against Torture in Bahrain.

More Articles by Rodney Shakespeare

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