Previously: Part 1: Bail Out With A Handkerchief
When movies like Catch-22 start making sense on more than one levels, it’s time to wake up and smell the smoke…
The theme of this episode is the economy…
The economy isn’t going very well, and the world’s politicians, flanked by the world’s bankers and businesspeople, are trying to resolve the crisis. They call emergency meetings to discuss strategy. They hold summits to show the world they’re serious about taking action. They go on TV, telling their people to stay calm because everything is under control; that there’s no need to worry, that their interests will be met and their rights defended. They seem sincere and eager, ready and willing. But they’re not. Neck deep in trouble, they sink deeper, taking everyone with them.
Newsflash: if your plane hurtles through the air on its way to a crash landing, you don’t seek out the individuals responsible (let’s assume it’s down to human error) and punish them while the plane is coming down. Neither do you have a long debate on how to deal with things. You fix the damn situation before you go down in flames.
And if you’re not in the plane but on the ground, you don’t wait for the plane to crash, talking theories and turnovers. You prepare for a rescue operation and oversee it, making sure it’s carried out well – if you’re sane and in touch with reality.
If you’re able.
Not our world leaders, at least not so far. They keep missing the point, babbling, bickering and politicking their way through, and on go the discussions about the future of the economy, trying to figure out solutions while the whole operation comes crashing down in flames, taking its citizens with it.
Here’s how the state of the economy and its politicians look like. You be the judge whether this is satire or reality.
Greece Is Just The Start
Take Greece, for instance. The country faces one of the worst conundrums a modern state has ever had to face. If it doesn’t cut spending, it can’t afford to pay its debts, and goes bankrupt. It it cuts spending and raises taxes to pay its debts, its citizens starve and its economy crashes out, for good.
Furthermore, Greek politicians are trying to meet the demands of the nation’s creditors, which means immediate reform in return for much-needed funding. This reform will be good for Greece in the long run because it will finally get the state on a economically sustainable path by
- Cutting down the behemoth public service,
- Shaving all vampirian entitlements off,
- Clamping down on institutionalized tax evasion,
- Raising the retirement age from 50-something to maybe 65,
- Banning multiple pensions, and
- Turning Greece into a responsible, self-sufficient, properly-run state.
But in the short term, the austerity measures are like chemotherapy. They might just kill the patient.
Good riddance, some say. We’ve no need for Greece, let it go to hell!
Only they (we) do have need for Greece, and a great one at that. (Forget compassion, I won’t even go there – this is about dry, cold, economic policy.) Fact: if Greece goes down, Italy gets afflicted, and goes down, too. You thought cancer wasn’t contagious? Financial cancer is, and it moves like a crab, in all directions, faster than you can say house on fire. Italy gets afflicted – in fact, the country’s already afflicted with its own 1.8 trillion euro debt – so any death rattle from its neighbor and Italy metastasizes, losing all confidence in itself and buckling down, and everyone deserts it, and paf, there goes the Mediterranean boot.
And then Spain goes down, and France goes down, and everything goes down. The situation is contagious because all the players are joined at the economic hip – it’s the way it was designed and put together over the past decades.
Unfortunately some of them screwed up in the process. So now, as things stand (not very tall), it’s all for one and some or nothing, and they don’t like it.
If we don’t band together, it’s going to be nothing,
The Germans know this but they can’t bear the prospect of putting their hard-earned money into funds that bail out – and, thus, reward – profligate, irresponsible behavior. They take the high road and present obstacles, telling their people their interests will be protected, their rights defended. They hold meetings and devise plans on how to have their cake and eat it, too: stave off a disaster that threatens to destroy everything, including the savings they so desperately want to protect, but they want this done without getting their hands dirty. Just like the Greeks who want to remain part of the EU without exercising the necessary reform. And the Italians who don’t want to go through the same dire straits as Greece, but are equally reluctant to pass the necessary reform. And the British who want to be a key player in Europe but don’t want to pay for the Eurozone’s blunders, and might even want to leave the EU altogether. You get the picture.
And on go the discussions and debates…