June 22, 2015
By: Kelly Diamond, Publisher
And so here we are nearing the end of June, and I’m asking myself, “Self, what is going on with our little friends in Greece?”
You know what this makes me think of? Those plot lines, where the main character embarks on this series of horrible choices that lands him in greater and greater trouble. Along the way, he is given chance after chance to make right his wrongs. His family and lover all beg him to change, but his pride gets the better of him. So now, our sad protagonist has pushed away all who love him, and the only ones offering their “help” are these vulturine, unsavory characters, like a mob boss or a loan shark. So he feels he has no other choice but to make this deal with the devil.
I would call it utterly cliché if Greece wasn’t literally living out that very plot line. (I feel oddly compelled, at this point, to say something about life imitating art and Greek tragedies.) Woe is Greece.
What Are They Doing?
The last time I wrote about them was just under one month ago (“Greece on Brink of Default”). I honestly thought they would swallow their pride, and unite under some semblance of an austerity program. I mean, the back-peddling was there! But instead, what did they do? They took out another line of credit! If I’m a Greek citizen, I have to be asking myself if this is real life! What the hell were they thinking to sign a deal with Turkey and Russia for a multi-BILLION dollar energy pipeline? Here’s the plan:
“The two countries will have equal shares in the company, [Russian Energy Minister Aleksandr] Novak said. Construction of the pipeline in Greece will be financed by Russia, and Athens will return the money afterward.”
Athens will return the money afterward? Really? In what alter-reality is this even plausible? I get why Russia is taking the high risk: they don’t want to deal with the EU and Ukraine as they did for the last pipeline venture. So now they turn their sights to less stable countries like Turkey, Greece, Hungary, and yes, even Cyprus. But Greece needs to clean up its act if it wants to continue to be taken seriously!
While Greece’s powers that be are suggesting everyone eat cake, the people are keen to what is happening. It was reported that approximately 3 Billion in Euros were withdrawn between June 15th and June 18th.
“As the fears of Greece defaulting on its €316 billion debt and leaving the Eurozone are escalating, people in Greece are rushing to take their savings out of banks. An estimated €200-€300 million a day was leaving the country prior to this week. Between October and April €30 billion left Greek banks, according to data from the Bank of Greece,” reports Reuters via RT on June 19th.
Final Act of Desperation
This is the part of the movie where you actually are embarrassed to watch because of the abject humiliation the main character undergoes. You know, that train wreck portion where it all comes to a head, and you’re embarrassed FOR the protagonist?
About four years ago, Zerohedge made a profound prediction. They said the term “Odious Debt” would become more prevalent. What is “Odious Debt”?
It is “a legal theory which holds that the national debt incurred by a regime for purposes that do not serve the best interests of the nation, should not be enforceable. Such debts are thus considered by this doctrine to be personal debts of the regime that incurred them and not debts of the state. In some respects, the concept is analogous to the invalidity of contracts signed under coercion”.
They didn’t call out Greece in particular in their portending, rather at that time they used Iraq and its debt as an example. When someone like Saddam Hussein incurs debt for such things as resources used to repress/oppress, and lavish personal luxuries, that debt should be seen as not of the people, but rather of that particular despot. But in the case of Iraq, they never had a choice to begin with, so it would stand to reason that everything that happened to that country was well outside the people’s control, and thus any debts acquired in their name are unjustified and illegitimate. I absolutely see the argument here. Which is why treating nations as persons is such messy business.
Greece on the other hand, is the birthplace of democracy (or as I like to refer to it, demo-crazy). They had choices, they made them, and now they must lie in the filthy bed they made.
Greece’s story is changing, and quite franking rearing its desperate head. At first, it promised it would make good on all its debts. But there is a plot twist: we introduce a “Debt Truth Committee” bent on getting to the bottom of this nonsense. The woman who spearheaded this committee is Zoi Konstantopoulou, the head of the Greek parliament and a SYRIZA member. And now the promise to pay off the debt looks a little more like, “we promise to pay off all the LEGAL debt”.
I cannot imagine what sort of implications such an argument will have before the IMF. They are keeping their diplomatic hats on and their lips tight, but when pressed I would really like to know what they will do if Greece says, “No dice.” Will they start to seize Greek assets such as land? Will they declare Greece bankrupt and defaulted then kick it to the curb outside the EU?
We are ONE WEEK out from deadline! And the only card Greece has after taking the IMF’s money and demanding several billion more is: this debt is illegal, illegitimate, and odious. “We aren’t paying.” A rather pathetic straw-grasp.
Zerohege goes on to say in a separate article: “If the Greek “Debt Truth Committee” indeed persists with determining how much of its debt is legal and enforceable, and ultimately decides to rescind some (or all) of it, the only question is how long until other countries around the world, all of which are burdened with massive, untenable debt loads across the government, financial and household sectors, decide it is time to do the same and declare a fresh start.”
Admittedly, I considered whether the United States would be eligible to take such recourse. But as I posited earlier, do democratic countries really have any room to say they were saddled by an irresponsible political class… that they ostensibly elected, in a system with which they hold a “social contract”?
Do we burn the “social contract”? Do we admit that democracy is inept and a failed experiment? Or do we hold Greece to account, and cut them loose to let them properly fail?
“Because at the end of the day,” Zerohedge says, “the winners will be 99% of the population – or all those who have been trampled upon by the central banking regime and their crony capitalists, private bank and oligarch backers. The only losers will be that 0.01% of the population which benefited during the past 8 years of what is now obvious to all has been nothing more than a farcical global ‘recovery’.”
I don’t know if this is necessarily true. Certainly not at the onset. The middle class savers would be wiped out as part of the scourge. When you wipe out the existing currency, you have to know that people just don’t go out and keep buying with it! Trade has to reinvent itself in a totally different context. And what was an asset yesterday, prior to all this, is now kindling.
To the disappointment of all those who seek some utopian outcome, I highly doubt the world will stand in solidarity. So in the end, what you will have is a worthless Greece, standing its shaky ground, staked in the socialist dream. A real life Greek Tragedy unfolding right before our eyes after all.