The question has to be asked: “Why shouldn't we default and let the banks fry?”
What possible benefit it there to the people of a nation whose previous leaders “sold out” the entire country on the basis of lies from the banks, notably Goldman Sachs?
Why not default and focus on full employment and resilience at home? Why rescue German banks?
If a new financial system is emerging, anchored by the BRICS [Brazil, Russia, India, China, South Africa], why not focus on being attractive that that new ethical financial system instead of giving up what is left in the way of seed corn to the old predatory unethical system?
Many European Lenders Have Sold Sovereign-Default Protection to One Another
EXTRACT:
Of the total protection that European banks have written on government bonds in Europe's five most-stressed countries, nearly one-third originated from German banks.
Here's a scenario from William Buiter (the chief economist at Citi) on what could happen if the EU collapses:
Disorderly sovereign defaults and eurozone exits by all five periphery states would drag down not just the European banking system but also the north Atlantic financial system and the internationally exposed parts of the rest of the global banking system. The resulting financial crisis would trigger a global depression that would last for years, with GDP likely falling by more than 10 per cent and unemployment in the West reaching 20 per cent or more. Emerging markets would be dragged down too.
I have a couple of additions to William's scenario:
We are seeing crisis and depression scenarios like this with regularity now. They are all presented as being on the cusp of occurring. It should be very clear to everyone by now, that something fundamental is wrong with the global system and the crisis de jour is just its symptom. Nobody “in charge” seems to be able to diagnose the real problems with our system.
The solutions being proposed are either a) more confidence (through bailouts) and b) more confidence (through more deficit spending). In other words: the problem is merely psychological and all you and I need to do is take some anti-depressants to eradicate any lingering pessimism (why worry, let's party!). In short: there aren't any real solutions being offered.
None of the bad actors that profit from the behavior that led us into this crisis, either in government or in the financial sector, are held to account. The moral hazard here is so vast, it can (and likely will) swallow the current economic system.
WIM: What does it Mean?
It's very simple. It is almost a certainty that a global economic depression is on its way and there is absolutely nothing you or I can do to stop it (a ballot box solution now would be as effective as replacing the Captain of the Titanic after the ship hit the iceberg). So, what can you and I do? We can take control of our environment. Our objective is to build or buy access to a community that has the resilience to not only help us survive a global depression, but thrive during it. A resilient community that:
Negates the impact of inevitable supply disruptions, rationing, and price spikes.
Protects you from the political violence that will erupt (mobs and police states).
Has a functional local economy that has the potential to network with other functional local economies.
Capture. Corporate power over government. It may seem like a dour topic (it is) and it may be hard to put it into perspective in our lives. How does it affect you and me? Lobbying, political influence, money in politics all seem very far away from daily life and it’s hard to see just where these issues touch our lives. So, let’s talk about it.
In the past couple of decades our country has been deeply divided on a number of topics but two issues stand out in the arena of corporate power over government: Health Care Legislation & War with Iraq.
. . . . . . . Two Examples Discussed: Health Care and Iraq . . . . . . .
This isn’t government of the people, for the people, by the people. It’s profit maximization for key industries and contractors with interests in military operation and healthcare. This is the essence of capture:corporate power has hijacked the language and purpose of government for their own ends. Democrat or Republican – it no longer matters at the national level because corporate money in politics has bought both parties.
In 1971, Lewis Powell, a mild-mannered, courtly, and shrewd corporate lawyer in Richmond, Virginia, soon to be appointed to the United States Supreme Court, wrote a memorandum to his client, the United States Chamber of Commerce. He outlined a critique and a plan that changed America.
Complete excerpt below the line — real history killing real people.
The violence at the heart of colonialism is exposed in Richard Gott's history
Richard Drayton
Guardian, 7 December 2011
Amazon Page for Reviewer's Book Nature's Government
“We insisted on reserving the right to bomb niggers.” So David Lloyd George explained the British government's demand at the 1932 World Disarmament Conference to keep the right to bomb for “police purposes in outlying places”. Airpower had shown its value in spreading what Winston Churchill, when defending in 1919 the use of poison gas against “uncivilised tribes”, had called “a lively terror”. Richard Gott shows how a hundred years earlier more hands-on means were used to similar ends: the heads of rebel slaves in Demerara in 1823 and Jamaica in 1831 were cut from their bodies and placed on poles beside the roads. The mutilation of the corpses of the defeated never quite goes out of fashion.
Amazon Page
Empires have always depended on violence. Killing, torture and the destruction of property are essential to those tasks of destroying resistance, extracting information and collaboration, and demonstrating dominance that underly all conquest. But it is the privilege of conquerors to tell stories that flatter their own past. It is, thus, rare to find the historians of any imperial power describing the ugly business of the frontier as more than unfortunate exceptions to an otherwise honourable enterprise. Britain is no exception: from the Victorians until the 1950s, its historians mainly saw in the British empire a great engine for diffusing liberty and civilisation to the world. If such Whig piety declined in the era after Suez, later scholars, studying particular places and times, never connected all the episodes of massacres, rebellions and atrocities. Popular historians continued profitably to sell happy stories of the empire to the British public – always marketed as daring revisionist accounts.
Gott's achievement is to show, as no historian has done before, that violence was a central, constant and ubiquitous part of the making and keeping of the British empire.
. . . . . . .
What Gott loses by this focus on resistance, however, is any subtlety in understanding the meanings of collaboration. He repeatedly imposes the lens of 20th-century nationalism, and even anti-fascism, so that those who did not rebel become traitors or “fifth columnists”. He does not examine with care or sympathy the varieties of loyalism, and the motives and experiences of those who chose, however mistakenly, to throw in their lot with the British. Neither does he explore how the economic and technological bases of British power changed between 1750 and 1850. For the revolution that science and industry brought to production, transport, communication and war made Britain able to attract and to extort indigenous collaboration more easily, and changed how the British understood themselves as a nation and their rights in the wider world. The empire was made by more than violence.
The evidence of an extensive Western covert program against Tehran, and Iranian retaliation, is now too obvious to ignore
Michael Hirsh
National Journal, 4 December 2011
Two incidents that occurred on Sunday—Iran’s claim of a shoot-down of a U.S. drone, and an explosion outside the British embassy in Bahrain—may have been unrelated. But they appear to add to growing evidence that an escalating covert war by the West is under way against Iran, and that Tehran is retaliating with greater intensity than ever.
Asked whether the United States, in cooperation with Israel, was now engaged in a covert war against Iran’s nuclear program that may include the Stuxnet virus, the blowing-up of facilities and the assassination or kidnapping of scientists, one recently retired U.S. official privy to up-to-date intelligence would not deny it.
