Whatever happens on Monday, Greece the country will survive this crisis – and the Greeks know it. The same can’t be said of the euro project – and we know it.
Could it be the case that in order to save the euro, the European elite destroys the EU? What is happening – and we are deeply involved – is quite shocking.
Last Thursday, by telling the world that he and others are preparing for a Greek exit from the euro, Michael Noonan – for some reason the most vocal finance minister on this issue – made certain that the Greek banks would experience a massive run on Friday.
Why is the rest of Europe trying to destroy the Greek banking system, which has already been made fragile by successive pro-European governments borrowing hand over fist and hoping to use the subsequent IOUs as collateral for the Greek banking system?
Why are we jumping on the bandwagon set in motion by the German media which relentlessly pursues the line that feckless lazy Greeks are only looking for debt forgiveness to make legitimate their idleness?
Are we so craven in our willingness to do someone else’s bidding that we forget historical facts?
I can understand that the German politicians looked their people in the eye and told them we will get all your money back from Greece, but why is Ireland faithfully being Germany’s greatest cheerleader?
Have we forgotten about Germany’s own history as the greatest European beneficiary of debt forgiveness? Or do our guys simply not know?
German memory – and that of its Irish supplicants – is very selective. There is no mention of the 1953 London Debt Agreement in their debates on Greece.
Why doesn’t someone remind Germany that in 1948 the introduction of the Deutsche Mark (backstopped by American capital) wiped out most of Germany’s domestic debt?
Or what about the fact that in 1953 half of Germany’s external debts, including their interest payments, were wiped out at the behest of a bankrupt Britain?
And furthermore, are we not aware that the Americans insisted the remaining debt payments could be spread out over a term of three decades?
Why doesn’t someone remind the Germans – and those in Ireland who want to be the best boys in the Teutonic class – that in the 1950s Germany’s debt was less than 20 per cent of their GDP, while much of the rest of western Europe in the 1950s struggled with debts of about 200 per cent of GDP?
How else do you think Germany could have rebuilt itself?
Albrecht Ritschl, an economic historian at the London School of Economics, estimated that the total debt forgiveness West Germany received from 1947 to 1953 was more than 280 per cent of Germany’s 1950 GDP.
This compares to 100 per cent of GDP that Greece has been pledged in aid since 2010. So the frugal Germans – who destroyed Europe, in case you had forgotten – got almost three times more debt forgiveness than the Greeks, who didn’t kill anyone!
Why doesn’t someone also point out that a clause in the London Agreement of 1953, which wiped out half of Germany’s debts determined that West Germany should only pay for the debts out of its trade surplus? This is exactly what the Greeks have put on the table, but they are rebuked by the likes of Christine Lagarde for not being credible.
Do our Department of Finance legates (who are playing a sleeveen role in this shameful piece of political theatre) not know that Germany’s debt repayment was limited in any one year to 3 per cent of West Germany’s export revenues?
What did this mean?
It meant that Germany’s creditors had to buy West German exports in order to be paid. Therefore, Germany did not have to resort to the Ponzi scheme of issuing new debt to pay for old debt.
Imagine if Greece asked that a certain percentage of Germans were obliged for the next ten years to take their holiday in Greece in order to give Greece the hard currency to pay back German banks?
It sounds strange, but that’s exactly the type of deal that Germany was given after World War II.
These are the overlooked facts. They have been replaced by the usual stereotypes that the Greeks – and by extension Italians, Spanish, Portuguese – are lazy Mediterraneans who want a German lifestyle but aren’t prepared to work for it.
We are witnessing a pathetic and shameful reinvention of history going on. Tomorrow there will be a Versailles Treaty-style conference, where the rest of Europe will dictate terms to the Greeks. By talking about the Greek exit from the euro on Thursday, the mainstream of Europe, who are supposed to do everything to make the euro an irrevocable system, have enfeebled the Greeks by forcing a bank run.
The Greeks are on their knees now – all the better to bully.
If the ECB turns off the taps, the banks in Athens will fold. Rather than protect the Greek banking system, the European Union has done everything in its power to crush it.
The Greeks are not innocent in this drama, but the crucial aspect to understand is that Syriza is the consequence not the cause of the crisis. The crisis was caused by German banks (and others) lending money to successive corrupt Greek governments.
None of these governments were ever described as radical when they were being feted in Berlin and Brussels, yet they were radically reckless.
Now the government that is charged with trying to sort everything out is labelled radical! How does that make you feel?
History is on the side of the Greeks. Whatever happens, Greece will survive, but if the euro system is based on selective interpretations of economic history, what hope has it in the next crisis?
Thank you!! Brilliantly analysed and expressed. And I read German news and I know what is going on over there. Schauble’s behaviour is simplistic, arrogant and disgraceful. Noonan is a jerk! An embarrassment to Ireland. Your points align perfectly with my own analysis of what is going on (that is not a coincidence). But my anger would disable me from expressing it so coherently. Well done and thanks
I agree, blackcase. The indignation expressed here on the side of the underdog, and the evidence presented to back up the case, is both heart-warming and persuasive. Today’s the day all will be revealed. May mercy and common sense prevail!
Just wondering, how should the poorer countries of the EU explain to their citizens why Greece gets preferable treatment? Why should Greece spend 17.5 % of GDP on pensions (2012 figures), while pensioners in Estonia, Ireland and Lithuania only get 7.9%, 7.3% and 7.7% (Eurostat). What did Irish pensioners do wrong?? Why should Greek pensioners get a 13th month of pension, when the government of Slovakia has denied this to its pensioners? Greek pensions are often comparable to German pensions – they just arrive at the age of 53, not 63-5 like in Germany. Can you explain why Greeks should… Read more »
Mercy and common sense is sadly lacking among the clowns of heads of government in the EU.
Hi, “Why is the rest of Europe trying to destroy the Greek banking system, which has already been made fragile by successive pro-European governments borrowing hand over fist and hoping to use the subsequent IOUs as collateral for the Greek banking system?” To teach the greeks a lesson that you are not to fuck with european politicians who serve a banking agenda. I presume that the german banks have liens on the collateral of greece? Surely it must be obvious to you that Greece will be asset stripped to bolster the balance sheets of European Banks? That Limerick cunt knows… Read more »
It looks like Mr Edna will be back onto us for more taxes;
I recently looked at the following indices;
They are ALL correcting.
It’s ironic that by current immigration and birth rates Brussels will be an Islamic city by 2030. Will future EU diktats emanate from a city under sharia law? The economic (collapse) and subsequent social (islamisation) prospects for continental western Europe look dystopian.
Has Greece blinked first?
“Greek concessions may secure deal”
Hi David, did you lose the gig with “Capital (www.capital.de). You have now!
I remain optimistic that Germany will remember in time why an integrated Europe is as necessary today for peace and prosperity as it was on 9 May 1950 when French Minister of Foreign Affairs, Robert Schuman, made the historical declaration called the Schuman Declaration, inspired by Jean Monnet the French economists and diplomat. It said in part “Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity.” The six original states, France, Germany, Italy, the Netherlands, Belgium and Luxembourg started by integrating… Read more »
There is a simple solution; Goldman Sachs can invent a new Greek derivative instrument that will create the missing billions – this can be followed by a ‘big 4’ audit that will undoubtedly provide a clean bill of health (based upon the information provided) and we can all start looking forward to sipping cocktails while watching a Santorini sunset. (at least until the next IMF payment is due :) )
Agreed treatment of Greece is beyond shameful. Looks like they have gouged more concessions from them and this charade will trundle on for another few months at least. 35% drop in wages since the crisis struck, some people will not be happy until Greeks are living on a euro a day and rely on charities to feed their families. They will then complain about all the educated Greek ‘economic migrants’ taking their jobs. Serious question where is the money going to come from? You cannot tax thin air, what usee is raised VAT when nobody has any money? I hope… Read more »
The ECB is now a problem. It is not living up to it’s responsibilities. And yet it’s way of continuing this stance, is to have an all out campaign against the Greeks for not living up to their responsibilities. In other words it is all BS, and the BS starts in the ECB. So where did the ECB go wrong. Well, the ECB went wrong when Wim Duisemburg (NL) got replaced by a Bank of France official who was involved in a very controversial scandal involving the Bank of France and a bank in Lyon (It might have been Credit… Read more »
The greatest insult to truth in the past decade has been the awarding of the Nobel Prize to the EU, whilst the EU directs misery on the population of Greece. The Greeks should have been given the Prize money. They are the real heroes. The EU’s accounts have not been signed off or audited fully for over a decade. Even Greece can do better. actually, even Rehab or the FAI are more accountable than the EU. The EU is on the road to ruin, and it will ruin many people along the way. It has lost direction, and lost the… Read more »
What is Noonan afraid of ?
”Germany, Ireland Demand ELA Curbs If No Greek Capital Controls As Greek “Proposal” Revealed”
What’s he afraid of? Having to live on a pension sharply devalued by a collapse of the Euro and being forced to live in the Country post retirement that he helped to destroy. Losing out on all the non-executive directorships as a reward (but conditional on)delivering heads on plates for his Brussels masters.
‘All efforts that aim at abolishing poverty in the world without putting gold coins and gold bills back into circulation are doomed.’
Dear David McWilliams, I read your site sometimes for excellent insights but I don’t like this article for several reasons. The German government made a big mistake in lending Greece so that the German banks can be paid back. They promised the German populace that Greece will be able to pay it back. So they now need somebody to blame, so they blame Greece. The German govt is just as corrupt as the whole EU establishment, they look at their own short term interests and they don’t give a flying f**k about the German or the Greek people. What they… Read more »
Many interesting comments, historical perspectives, and personal experiences have been noted. Back to the future it is now or the present at least. There is a gigantic battle being fought for world dominion. The US is intent at all costs to dominate, to have a unitary policy where all are vassals to its will or the will of the governors as 99% of the US population are included in “the world” Watching and observing the sequence of events over the last ten years or more I know lies, deceit and corruption are used to persuade us we do the right… Read more »
For the first time in Greece a documentary produced by the audience. “Debtocracy” seeks the causes of the debt crisis and proposes solutions, hidden by the government and the dominant media.
why is Ireland faithfully being Germany’s greatest cheerleader?
Using one slave to beat up another slave is the bully’s tradition.
Thanks for this article and also the one in the Indo today.
The Greek narrative at play right now simply reveals further the real narrative at play since the banking crisis in 2008.
The major banking conglomerates are networked in with the Euro and all special interests are gaming the Euro to hoover up real wealth, hard assets, and future income streams.
The EU has essentially been coopted by a financial cartel and the Euro is their mechanism on which their piracy has been unleashed.
WHO is going to sink these maniacs?
Corruption reigns at government behest. The CFTC turns a blind eye. No illegal activity here. But everywhere else there is. Billions in fines, no admission of guilt, and no one jailed for fraud.
There is no such thing as a free market. Price discovery is a sham. Misallocation of resources the result. Economic disaster inevitable.
Here is government duplicity at its finest. All paid off by the big money to betray the people. It must be a shock to have a greek government actually trying to represent the people.
Its shameful that vote is even close. Irish people have short memories of what its like to be humiliated and powerless, the people who voted no may be very unpleasantly surprised when the eyes of the Troika move to other indebted countries like Ireland.
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