Austerity bites Ireland and Elite
from The Daily Bell
posted Friday, October 01, 2010
Ireland’s love affair with masochism … The final bill for Anglo Irish Bank has ballooned to €34bn … A more shocking set of numbers is hard to imagine. The latest bailout package for Ireland’s insolvent banks will raise the nation’s budget deficit from an already alarmingly high 12 percent to a jaw dropping 32 percent, which will in turn send overall public debt spiralling upwards to just shy of 100 percent of GDP. Only a few years back, Ireland had one of the best public debt to GDP ratios in the eurozone at under 25 percent. The scale of the deterioration is truly astonishing, and vivid illustration of the degree to which Ireland’s “tiger economy” was built on the sand of misallocated credit. … The good news for Ireland is that these latest bailouts have the potential to draw a line in the sand, and provide a grounding from which the economy can rebuild. The other piece of good news to take from all this destruction is that Ireland has already fully funded itself until the middle of next year … [But] there must be some doubt over whether Ireland can grow its way back to health. – UK Telegraph
Dominant Social Theme:
We are shocked that Ireland has not improved. But we know it will!
The EUs condition continues to deteriorate and austerity has fanned the flames of resentment as we predicted it would. Ireland is in fact a kind of poster child for the uselessness of what is occurring now. And here at the Bell, we would like to make sure that people do not misunderstand the ramifications. The EU is a core project for the power elite. It is a building block of world government. The elite in no way wants the EU to disintegrate or shrink. In fact, an additional dominant social theme might be: “Sure, we’ve made mistakes, but we will muddle through, all of us.”
The EU is still, for instance, trying to bring Iceland into the fold. And numerous other countries as well. There is debate about offering Turkey and even Russia the ability to join the EU. The EU is expansive because the elite likely had the idea that it could create three or four regional, global building blocks that could serve as a platform for some sort of one-world governance.
We don’t need any secret plans or startling admissions from insiders to tell us this. We have eyes and ears (2,000 of them!). The EU, the now-scuttled North American Union (for the moment anyway) and the planned regional enterprises in Asia, Africa and South America tell us what we need to know. This was the plan. Of course there are many, especially in the alternative news community, who will maintain that all is working just fine. That the idea all along was to introduce the EU, build it up and then destabilize it. We find this a stretch. We think the elite basically miscalculated.
Yes, as regards the EU (and many other promotions) it did not count on the truth-telling of the Internet when planning for further globalization. Order from chaos is certainly a utile strategy, but too much chaos, as we have pointed out before, can be counterproductive. And certainly there does seem to be a good amount of chaos in the EU at the present time. The Telegraph reports the following:
Europe’s austerity anger grows… More than 100,000 marchers converged on Brussels from across the EU to protest austerity measures on Wednesday, while Spanish unions took the extraordinary step of breaking ranks with Spain’s socialist government by launching a general strike … “Workers are on the streets today with a clear message to Europe’s leaders,” said John Monks, head of the European Trade Union Confederation.
“There is a great danger that workers are going to pay the price for the reckless speculation that took place in financial markets,” … he said, reflecting growing bitterness among ordinary people that they are bearing the brunt of austerity while bondholders have been shielded from losses.
Austerity fatigue is surfacing across a large arc of Eastern and Southern Europe, raising concerns that electorates may start to rebel. The Fidesz government in Hungary has already sent the EU and the International Monetary Fund packing, opting for “economic nationalism”. Even the police joined demonstrations last week in Romania, hurling their kit at the presidential palace to protest public sector wage cuts of 25%.
The anger in Europe has been interpreted as basically public-union based. But we don’t see it that way. As we have pointed out, “austerity” as a solution affects everyone in a given society. Not only are taxes raised, but public services are cut. This would be fine if public services could be privatized and subject to competition, but alas this is not to be. If roads are to crumble and sewers are to rot, this is then a further result of austerity: All must be punished for the sins of a few.
But thanks in part to the Internet (in our view) many middle class Europeans have come to other conclusions about where the blame lies. The fruits of EU membership were harvested by a few – national elites plus the larger power elite – and austerity is indeed a way of demanding that the middle classes pay for this enrichment.
As we pointed out just yesterday, if the elite wanted to jumpstart economies, the best and fastest way to do it would be to disburse central bank funds directly to consumers. Sure, it’s not a real solution and would cause eventually cause massive price inflation. But it would likely have a short-term impact. But the elite will not do it because to do so would be to reveal the essential fraudulent nature of the money and banking system itself. So the elite is stuck with the current system of distribution of money through banks and financial firms, which is neither efficient nor especially effective.
Likewise, the power elite (focused on building global governance) could find methodologies besides austerity to cure the EU of its ills. But most significant solutions likely demand the loosening of the ties between EU nation states. This the EU leaders will not do because to do so would be to take a step backwards in their march towards global hegemony. The EU, an increasingly authoritarian regime, cannot afford to be seen as backing down.
And so the EU will stumble forwards. It will demand austerity even though austerity without devaluation is almost proven to fail. It will allow the IMF to inflict on the PIGS what that agency has inflicted on third-world countries around the world. But Europe is not the third world. The unions, public and private, are well aware of the battles being waged and the strategies being implemented. The more this goes on, the more polarized the EU will become and the less support the union will probably derive. If the elite had picked a method of siphoning support AWAY from the EU, it could hardly have done a better job.
Again, many in the alternative news community will maintain that everything is going according to plan. But all across the EU we see signs of burgeoning bellicosity. The tribes of Europe, as we predicted, have come to a conclusion that the EU is no longer a source of easy or predictable wealth. And in fact that is not a good thing for the union.
One only needs to look at the bestiality of World War II to understand the savagery that lurks beneath the surface in most European nations. The EU and the central banking system itself bought off the tribes for decades. But the money has ceased to pump and the bill has come due. In our view, the elite in its arrogance and greed has miscalculated – and only time will tell how grave that miscalculation proves to be.