Daily Archives: July 26, 2015
According to mainstream media, the current economic crisis in Greece is due to the government spending too much money on its people that it went broke. This claim however, is a lie. It was the banks that wrecked the country so oligarchs and international corporations could benefit.
Every single mainstream media has the following narrative for the economic crisis in Greece: the government spent too much money and went broke; the generous banks gave them money, but Greece still can’t pay the bills because it mismanaged the money that was given. It sounds quite reasonable, right?
Except that it is a big fat lie … not only about Greece, but about other European countries such as Spain, Portugal, Italy and Ireland who are all experiencing various degrees of austerity. It was also the same big, fat lie that was used by banks and corporations to exploit many Latin American, Asian and African countries for many decades.
Greece did not fail on its own. It was made to fail.
In summary, the banks wrecked the Greek government and deliberately pushed it into unsustainable debt so that oligarchs and international corporations can profit from the ensuing chaos and misery.
If you are a fan of mafia movies, you know how the mafia would take over a popular restaurant. First, they would do something to disrupt the business – stage a murder at the restaurant or start a fire. When the business starts to suffer, the Godfather would generously offer some money as a token of friendship. In return, Greasy Thumb takes over the restaurant’s accounting, Big Joey is put in charge of procurement, and so on. Needless to say, it’s a journey down a spiral of misery for the owner who will soon be broke and, if lucky, alive.
Now, let’s map the mafia story to international finance in four stages.
Stage 1: The first and foremost reason that Greece got into trouble was the “Great Financial Crisis” of 2008 that was the brainchild of Wall Street and international bankers. If you remember, banks came up with an awesome idea of giving subprime mortgages to anyone who can fog a mirror. They then packaged up all these ticking financial bombs and sold them as “mortgage-backed securities” at a huge profit to various financial entities in countries around the world.
A big enabler of this criminal activity was another branch of the banking system, the group of rating agencies – S&P, Fitch and Moody’s – who gave stellar ratings to these destined-to-fail financial products. Unscrupulous politicians such as Tony Blair got paid by Big Banks to peddle these dangerous securities to pension funds and municipalities and countries around Europe. Banks and Wall Street gurus made hundreds of billions of dollars in this scheme.
But this was just Stage 1 of their enormous scam. There was much more profit to be made in the next three stages!
Stage 2 is when the financial time bombs exploded. Commercial and investment banks around the world started collapsing in a matter of weeks. Governments at local and regional level saw their investments and assets evaporate. Chaos everywhere!
Vultures like Goldman Sachs and other big banks profited enormously in three ways: one, they could buy other banks such as Lehman brothers and Washington Mutual for pennies on the dollar. Second, more heinously, Goldman Sachs and insiders such as John Paulson (who recently donated $400 million to Harvard) had made bets that these securities would blow up. Paulson made billions, and the media celebrated his acumen. (For an analogy, imagine the terrorists betting on 9/11 and profiting from it.) Third, to scrub salt in the wound, the big banks demanded a bailout from the very citizens whose lives the bankers had ruined! Bankers have chutzpah. In the U.S., they got hundreds of billions of dollars from the taxpayers and trillions from the Federal Reserve Bank which is nothing but a front group for the bankers.
In Greece, the domestic banks got more than $30 billion of bailout from the Greek people. Let that sink in for a moment – the supposedly irresponsible Greek government had to bail out the hardcore capitalist bankers.
Stage 3 is when the banks force the government to accept massive debts. For a biology metaphor, consider a virus or a bacteria. All of them have unique strategies to weaken the immune system of the host. One of the proven techniques used by the parasitic international bankers is to downgrade the bonds of a country. And that’s exactly what the bankers did, starting at the end of 2009. This immediately makes the interest rates (“yields”) on the bonds go up, making it more and more expensive for the country to borrow money or even just roll over the existing bonds.
From 2009 to mid-2010, the yields on 10-year Greek bonds almost tripled! This cruel financial assault brought the Greek government to its knees, and the banksters won their first debt deal of a whopping 110 billion Euros.
The banks also control the politics of nations. In 2011, when the Greek prime minister refused to accept a second massive bailout, the banks forced him out of the office and immediately replaced him with the Vice President of ECB (European Central Bank)! No elections needed. Screw democracy. And what would this new guy do? Sign on the dotted line of every paperwork that the bankers bring in.
(By the way, the very next day, the exact same thing happened in Italy where the Prime Minister resigned, only to be replaced by a banker/economist puppet. Ten days later, Spain had a premature election where a banker puppet won the election).
The puppet masters had the best month ever in November 2011.
Few months later, in 2012, the exact bond market manipulation was used when the banksters turned up the Greek bonds’ yields to 50%!!! This financial terrorism immediately had the desired effect: The Greek parliament agreed to a second massive bailout, even larger than the first one.
Now, here is another fact that most people don’t understand. The loans are not just simple loans like you would get from a credit card or a bank. These are loans come with very special strings attached that demand privatization of a country’s assets. If you have seen Godfather III, you would remember Hyman Roth, the investor who was carving up Cuba among his friends. Replace Hyman Roth with Goldman Sachs or IMF (International Monetary Fund) or ECB, and you get the picture.
Stage 4: Now, the rape and humiliation of a nation begin under the name of “austerity” or “structural reforms.” For the debt that was forced upon it, Greece had to sell many of its profitable assets to oligarchs and international corporations. And privatizations are ruthless, involving everything and anything that is profitable. In Greece, privatization included water, electricity, post offices, airport services, national banks, telecommunication, port authorities (which is huge in a country that is a world leader in shipping) etc. Of course, the ever-manipulative bankers always demand immediate privatization of all media which means that the country gets photogenic TV anchors who spew establishment propaganda every day and tell the people that crooked and greedy banksters are saviors; and slavery under austerity is so much better than the alternative.
In addition to that, the banker tyrants also get to dictate every single line item in the government’s budget. Want to cut military spending? NO! Want to raise tax on the oligarchs or big corporations? NO! Such micro-management is non-existent in any other creditor-debtor relationship.
So what happens after privatization and despotism under bankers? Of course, the government’s revenue goes down and the debt increases further. How do you “fix” that? Of course, cut spending! Lay off public workers, cut minimum wage, cut pensions (same as our social security), cut public services, and raise taxes on things that would affect the 99% but not the 1%. For example, pension has been cut in half and sales tax increase to more than 20%. All these measures have resulted in Greece going through a financial calamity that is worse than the Great Depression of the U.S. in the 1930s.
After all this, what is the solution proposed by the heartless bankers? Higher taxes! More cuts to the pension! It takes a special kind of a psychopath to put a country through austerity, an economic holocaust.
If every Greek person had known the truth about austerity, they wouldn’t have fallen for this. Same goes for Spain, Italy, Portugal, Ireland and other countries going through austerity. The sad aspect of all this is that these are not unique strategies. Since World War II, these predatory practices have been used countless times by the IMF and the World Bank in Latin America, Asia, and Africa.
This is the essence of the New World Order — a world owned by a handful of corporations and banks; a world that is full of obedient, powerless debt serfs.
So, it’s time for the proud people of Greece to rise up like Zeus and say NO (“OXI” in Greece) to the greedy puppet masters, unpatriotic oligarchs, parasitic bankers and corrupt politicians.
Dear Greece, know that the world is praying for you and rooting for you. This weekend, vote NO to austerity. Say YES to freedom, independence, self-government, sovereignty, and democracy. Go to the polls this weekend and give a resounding, clear victory for the 99% in Greece, Europe, and the entire western world.
The poor and the working class in the United States know what it is to be Greek. They know underemployment and unemployment. They know life without a pension. They know existence on a few dollars a day. They know gas and electricity being turned off because of unpaid bills. They know the crippling weight of debt. They know being sick and unable to afford medical care. They know the state seizing their meager assets, a process known in the United States as “civil asset forfeiture,” which has permitted American police agencies to confiscate more than $3 billion in cash and property. They know the profound despair and abandonment that come when schools, libraries, neighborhood health clinics, day care services, roads, bridges, public buildings and assistance programs are neglected or closed. They know the financial elites’ hijacking of democratic institutions to impose widespread misery in the name of austerity. They, like the Greeks, know what it is to be abandoned.
The Greeks and the U.S. working poor endure the same deprivations because they are being assaulted by the same system—corporate capitalism. There are no internal constraints on corporate capitalism. And the few external constraints that existed have been removed. Corporate capitalism, manipulating the world’s most powerful financial institutions, including the Eurogroup, the World Bank, the International Monetary Fund and the Federal Reserve, does what it is designed to do: It turns everything, including human beings and the natural world, into commodities to be exploited until exhaustion or collapse. In the extraction process, labor unions are broken, regulatory agencies are gutted, laws are written by corporate lobbyists to legalize fraud and empower global monopolies, and public utilities are privatized. Secret trade agreements—which even elected officials who view the documents are not allowed to speak about—empower corporate oligarchs to amass even greater power and accrue even greater profits at the expense of workers. To swell its profits, corporate capitalism plunders, represses and drives into bankruptcy individuals, cities, states and governments. It ultimately demolishes the structures and markets that make capitalism possible. But this is of little consolation for those who endure its evil. By the time it slays itself it will have left untold human misery in its wake.
The Greek government kneels before the bankers of Europe begging for mercy because it knows that if it leaves the eurozone, the international banking system will do to Greece what it did to the socialist government of Salvador Allende in 1973 in Chile; it will, as Richard Nixon promised to do in Chile, “make the economy scream.” The bankers will destroy Greece. If this means the Greeks can no longer get medicine—Greece owes European drug makers 1 billion euros—so be it. If this means food shortages—Greece imports thousands of tons of food from Europe a year—so be it. If this means oil and gas shortages—Greece imports 99 percent of its oil and gas—so be it. The bankers will carry out economic warfare until the current Greek government is ousted and corporate political puppets are back in control.
Human life is of no concern to corporate capitalists. The suffering of the Greeks, like the suffering of ordinary Americans, is very good for the profit margins of financial institutions such as Goldman Sachs. It was, after all, Goldman Sachs—which shoved subprime mortgages down the throats of families it knew could never pay the loans back, sold the subprime mortgages as investments to pension funds and then bet against them—that orchestrated complex financial agreements with Greece, many of them secret. These agreements doubled the debt Greece owes under derivative deals and allowed the old Greek government to mask its real debt to keep borrowing. And when Greece imploded, Goldman Sachs headed out the door with suitcases full of cash.
The system of unfettered capitalism is designed to callously extract money from the most vulnerable and funnel it upward to the elites. This is seen in the mounting fines and fees used to cover shortfalls in city and state budgets. Corporate capitalism seeks to privatize all aspects of government service, from education to intelligence gathering. The U.S. Postal Service appears to be next. Parents already must pay hundreds of dollars for their public-school children to take school buses, go to music or art classes and participate in sports or other activities. Fire departments, ambulance services, the national parks system are all slated to become fodder for corporate profit. It is the death of the civil society.
Criminal justice is primarily about revenue streams for city and state governments in the United States rather than about justice or rehabilitation. The poor are arrested and fined for minor infractions in Ferguson, Mo., and elsewhere; for not mowing their lawns; for putting their feet on seats of New York City subway cars. If they cannot pay the fines, as many cannot, they go to jail. In jail they are often charged room and board. And if they can’t pay this new bill they go to jail again. It is a game of circular and never-ending extortion of the poor. Fines that are unpaid accrue interest and generate warrants for arrest. Poor people often end up owing thousands of dollars for parking or traffic violations.
Fascist and communist firing squads sometimes charged the victim’s family for the bullets used in the execution. In corporate capitalism, too, the abusers extract payment; often the money goes to private corporations that carry out probation services or prison and jail administration. The cost of being shot with a stun gun ($26) or of probation services ($35 to $100 a month) or of an electronic ankle bracelet ($11 a month) is vacuumed out of the pockets of the poor. And all this is happening in what will one day be seen as the good times. Wait until the financial house of cards collapses again—what is happening in China is not a good sign—and Wall Street runs for cover. Then America will become Greece on steroids.
“We are a nation that has turned its welfare system into a criminal system,” write Karen Dolan and Jodi L. Carr in an Institute for Policy Studies report titled “The Poor Get Prison.” “We criminalize life-sustaining activities of people too poor to afford shelter. We incarcerate more people than any other nation in the world. And we institute policies that virtually bar them for life from participating in society once they have done their time. We have allowed the resurgence of debtors’ prisons. We’ve created a second-tier public education system for poor children and black and Latino children that disproportionally criminalizes their behavior and sets them early onto the path of incarceration and lack of access to assistance and opportunity.”
The corporate dismantling of civil society is nearly complete in Greece. It is far advanced in the United States. We, like the Greeks, are undergoing a political war waged by the world’s oligarchs. No one elected them. They ignore public opinion. And, as in Greece, if a government defies the international banking community it is targeted for execution. The banks do not play by the rules of democracy.
Our politicians are corporate employees. And if you get dewy-eyed about the possibility of the U.S. having its first woman president, remember that it was Hillary Clinton’s husband who decimated manufacturing jobs with the 1994 North American Free Trade Agreement and then went on to destroy welfare with the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, which halted federal cash aid programs and imposed time-limited, restrictive state block grants. Under President Bill Clinton, most welfare recipients—and 70 percent of those recipients were children—were dropped from the rolls. The prison-industrial complex exploded in size as its private corporations swallowed up surplus, unemployed labor, making $40,000 or more a year from each person held in a cage. The population of federal and state prisons combined rose by 673,000 under Clinton. He, along with Ronald Reagan, set the foundations for the Greecification of the United States.
The destruction of Greece, like the destruction of America, by the big banks and financial firms is not, as the bankers claim, about austerity or imposing rational expenditures or balanced budgets. It is not about responsible or good government. It is a vicious form of class warfare. It is profoundly anti-democratic. It is about forming nations of impoverished, disempowered serfs and a rapacious elite of all-powerful corporate oligarchs, backed by the most sophisticated security and surveillance apparatus in human history and a militarized police that shoots unarmed citizens with reckless abandon. The laws and rules it imposes on the poor are, as Barbara Ehrenreich has written, little more than “organized sadism.”
Corporate profit is God. It does not matter who suffers. In Greece 40 percent of children live in poverty, there is a 25 percent unemployment rate and the unemployment figure for those between the ages of 15 and 24 is nearly 50 percent. And it will only get worse.
The economic and political ideology that convinced us that organized human behavior should be determined by the dictates of the global marketplace was a con game. We were the suckers. The promised prosperity from trickle-down economics and the free market instead concentrated wealth among a few and destroyed the working and the middle classes along with all vestiges of democracy. Corrupt governments, ignoring the common good and the consent of the governed, abetted this pillage. The fossil fuel industry was licensed to ravage the ecosystem, threatening the viability of the human species, while being handed lavish government subsidies. None of this makes sense.
The mandarins that maintain this system cannot respond rationally in our time of crisis. They are trained only to make the system of exploitation work. They are blinded by their insatiable greed and neoliberal ideology, which posits that controlling inflation, privatizing public assets and removing trade barriers are the sole economic priorities. They are steering us over a cliff.
We will not return to a rational economy or restore democracy until these global speculators are stripped of power. This will happen only if the streets of major cities in Europe and the United States are convulsed with mass protests. The tyranny of these financial elites knows no limits. They will impose ever greater suffering and repression until we submit or revolt. I prefer the latter. But we don’t have much time.