Beware of Greeks who can’t bear to govern themselves

The hazards of having a parliamentary system in a bitterly divided country (from Reuters):

Greece abandoned a nine-day hunt for a government on Tuesday and called a new election that may hand victory to leftists who might cut the nation’s financial lifeline, pushing it closer to bankruptcy and out of the euro zone.

After six rounds of fruitless wrangling, party leaders emerged from a final session at the presidential mansion to gloomily declare that deep divisions over a 130-billion-euro foreign bailout package had killed any hope of a coalition deal.

“We shouldn’t have reached this point,” said Socialist leader Evangelos Venizelos, who personally negotiated the rescue package from the European Union and IMF which the hard left says has imposed too harsh an austerity regime. “For God’s sake, let’s move towards something better and not something worse.”

The last elections were held just nine days ago.

In case you’re wondering what’s the difference between the “leftists” referenced in the first paragraph and the Socialist quoted in the third, the “leftists” are members of a party named the Coalition of the Radical Left. The party has said it wants to ditch the bailout — and the austerity measures imposed by the countries, namely Germany, providing the cash — but keep the euro currency.

The math involved makes such a position practically impossible. The only ways Greece can meet its debt obligations in the short run are a) to borrow more money from its European neighbors or b) to devalue its currency, which involves having its own currency, which involves dropping the euro. They can’t be against both, but that’s what the Coalition says it favors.

Markets turned a promising day of gains into yet another day of losses on the news, and the increased likelihood of turmoil for the euro currency — and, perhaps in turn, larger countries such as Italy and Spain. That would mean big trouble for the European economy, and in turn our economy.

And, along the way, France will have to reckon with its newly elected president and his mandate to reverse the country’s “austerity” policies (contrary to popular belief, French government spending has continued to rise annually).

This is what happens when you kill an economy’s animal spirits by subsidizing failure and punishing success for years and years on end.

On a brighter note: If you’re inclined to spend your money rather than watch your investments shrink and savings earn no interest, Europe is on sale again!

– By Kyle Wingfield

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53 comments Add your comment

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

May 15th, 2012
4:16 pm

Who will bail out the EU and IMF?

That’s right, you will!

Congratulations!

Tiberius - Banned from Bookman's and proud of it!

May 15th, 2012
4:30 pm

Markets also dropped today because of seriously lower retail sales numbers for April.

Refresh my memory. Which blogger on this site warned everybody over a month ago that retail sales were about to take a hit?

Tiberius was right – again!

Tiberius - Banned from Bookman's and proud of it!

May 15th, 2012
4:32 pm

“In case you’re wondering what’s the difference between the “leftists” referenced in the first paragraph and the Socialist quoted in the third, the “leftists” are members of a party named the Coalition of the Radical Left.”

This is what happens when voters elect “popular” people who have never studied an economy or know how one works.

In the U.S. we call them Obama and the Democrats. :D

TruthBe

May 15th, 2012
4:35 pm

America and Europe shouldn’t bail out Greece, Spain, or any other nation anymore. Let them fall, that way they can pick themselves up and fix their own lazy socialist ways.

Jefferson

May 15th, 2012
4:35 pm

Thats what YOU think.

Kyle Wingfield

May 15th, 2012
4:41 pm

Tiberius @ 4:30: Actually, markets were up or treading water until the Greek elections announcement. Retail sales didn’t drop; their growth rate did.

Tiberius - Banned from Bookman's and proud of it!

May 15th, 2012
4:51 pm

They dropped due to both, Kyle. Some specific retail sales numbers came out later in the day after a general number was posted in the morning.

And yes, they are still up by a measly 1%, but half of what was expected and drastically lower than March’s 7% number.

The march towards the double-dip recession has begun.

Jefferson

May 15th, 2012
4:54 pm

Tell you about the plane crash with a gleem in her eye…

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
5:31 pm

This is what happens when you kill an economy’s animal spirits by subsidizing failure and punishing success for years and years on end.
———————-

That pretty well sums up Idiot Klown Obozo’s economic policy.

It’s great for getting the losers, parasites, and moochers to vote for you though–keep the handouts flowing while bashing the folks who pay the bills.

Rafe Hollister

May 15th, 2012
5:41 pm

Somewhere back in time I took a course on government types and how they are born. A non-functional democracy, if I remember correctly, turns to a benevolent dictator, enabling him with the powers to solve the issues that resist compromise. Works for awhile, but the benevolent dictator is usually overthrown by a more ruthless autocrat, who forces things to happen.

Sounds like Greece is about ready for the benevolent dictator, to implement the austerity that they will have to have to survive.

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
5:42 pm

I hope that when Obozo’s $1.5 trillion deficits and his economy-wrecking entitlements and orgy of over-regulation reach their natural conclusion (total financial Greek-style meltdown), we’ll be more accepting of it and try to fix things, rather than remain in denial as Greece is doing.

saywhat?

May 15th, 2012
6:20 pm

Lil’ Barry Bailout (Revised Downward)

May 15th, 2012
5:42 pm
I hope that when Obozo’s $1.5 trillion deficits and his economy-wrecking entitlements and orgy of over-regulation reach their natural conclusion (total financial Greek-style meltdown), we’ll be more accepting of it and try to fix things, rather than remain in denial as Greece is doing.
_____________________________________________________
And thinking people had hoped that when Shrub and the republibozo’s trillion dollar deficits from unfunded needless wars, unfunded needless tax cuts for the rich, unfunded medicare part D, and the economy wrecking orgy of deregulation reached their natural conclusion in 2007 (worst recession since the great depression, American style), everybody would be more accepting of it and try and fix things. Unfortunately, the Republicans and their teatard brigade remained in denial, kicking and screaming like little girls, obstructing everything, while the adults on the other side of the aisle went to work.

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
6:28 pm

Our President Bush never ran (much less proposed four consecutive) Obozo-sized $1+ trillion deficits.

Tax revenues were higher after Our President Bush implemented His tax cuts in 2003.

Our President Bush fixed the Dodd-Frank housing meltdown and resulting recession (TARP).

Obozo inherited a recovery from Our President Bush.

Obozo got everything he wanted passed in the first two years of his regime–economic and fiscal policy included.

Bottom line, saywhat, is that your Idiot Klown Obozo took an improving situation and drove it into the ditch. Republicans, thankfully, regained the House in 2010 as a result, and (thankfully again) obstructed further liberal fascist scheming.

saywhat?

May 15th, 2012
6:34 pm

LBB-”blah blah blah—-blah blah blah”- (not intended to be a factual statement).

redneckbluedog

May 15th, 2012
6:37 pm

Kyle……

Greece is where politics started….”POLITICS” is based on the Greek “POLITEA”……They really don’t have much going for them now, but they still have their political history….I wouldn’t count them out….

Rafe Hollister

May 15th, 2012
6:38 pm

while the adults on the other side of the aisle went to work.

Spending trillions of dollars of money that we do not have is work. I guess when you have never done any strenuous work in your life, like Barry Oblamer, writing checks is work.

redneckbluedog

May 15th, 2012
6:38 pm

BTW…here’s a “socialist” idea to help some folks out…..

A one-time “retirement amnesty”……You can retire with full benefits at 62-1/2…..One time only…!!! That will help some older Americans out with their 401K deficiencies, and clear out some space for some jobs for younger workers….

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
6:50 pm

Still waiting on the Democrat Senate to do some of that “hard work” we keep hearing about, and pass a budget.

Democrats: Lazy.

jconservative

May 15th, 2012
7:11 pm

While the US sits here and is unable to reach a compromise on deficits and debt reduction and as a result the deficits continue and the debt get larger.

We are the last one to be critizing another country management of its economy.

getalife

May 15th, 2012
7:41 pm

Austerity killed the EU and gave us the rise of Germany again.

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
8:13 pm

While the US sits here and is unable to reach a compromise…
———-

The Republican House has passed a budget. The Democrat Senate continues to obstruct and pass nothing of their own.

Democrats: Lazy.

Lil' Barry Bailout (Revised Downward)

May 15th, 2012
8:17 pm

“Austerity” would lead you to believe that France was spending less this year than last. That is not the case.

Libtards should learn the meanings of words before attempting to use them. It’s just another manifestation of our failed Democrat-run public schools.

Hillbilly D

May 15th, 2012
8:27 pm

It’s all Greek to me.

JKL2

May 15th, 2012
8:37 pm

saywhat?- unfunded needless tax cuts for the rich

You might have some kind of point to make, but I’m laughing to hard at this to read any more.

Maybe your the genius I’ve been looking for to explain to me how a tax increase is called a budget cut by the Democrats?

Ronnie Raygun

May 15th, 2012
9:02 pm

“This is what happens when you kill an economy’s animal spirits by subsidizing failure and punishing success for years and years on end.”

You mean like when Rmoney’s Bain Capital took tens of millions in government subsidies to create jobs in Puerto Rico and then turned around and outsourced the jobs nearly 1000 Americans? Vulture Capitalism at it’s best

Ronnie Raygun

May 15th, 2012
9:05 pm

No wonder why Republicans want to punish hard work with higher tax rates than unearned income.

Republican are LAZY. No surprise there.

@@

May 15th, 2012
9:23 pm

GREEK depositors withdrew 700 million euros from local banks on Monday, the country’s president said, and warned that the situation facing Greece’s lenders was very difficult.

Greek banks have seen a steady decline in deposits since the start of the country’s debt crisis in 2009, which prompted depositors to withdraw cash and transfer funds to overseas banks. In the past two years, deposit outflows have generally averaged between €2 billion and €3 billion per month, though in January they topped the €5 billion mark.

Panic sets in.

California’s not faring much better than Greece.

No Artificial Flavors

May 15th, 2012
9:33 pm

My European Union studies professor in college predicted this very conundrum about 10 years ago. It made sense then but these utopian euro leftists refused to listen to the arguments for at least a decade and hurried into this fiscal calamity. Im sure you heard it all in Belgium as well, Kyle.

Dusty

May 15th, 2012
10:13 pm

Well, I am really sorry about the Greeks. They have such a beautiful place to live. Their ancient history is wonderful with all the smart people like Socrates and my favorite Pericles among many others.

Perhaps Greeks will finally realize that there is no easy way out of a tight spot. We are realizing the same thing but with a better base line.

But there IS good news tonight! The BRAVES just won and it’s BRAVES 6 Cincinnati 2.

You just have to take good news where you can find it.

Michael H. Smith

May 15th, 2012
10:23 pm

No Artificial Flavors, was your EU studies professor speaking solely with respects to Europe? For some strange reason your comments sounds all to Déjà vu of the USA? Perhaps when our creditors no longer are willing to buy our debt and begin to demand a higher rate of interest to fiance what we borrow, we too, will as Greece, be forced to borrow money just to pay the interest alone on our debt?

Oh and if I might be so bold to ask, was your professor’s name, Paul Ryan by any chance? :)

jconservative

May 15th, 2012
10:35 pm

“The Republican House has passed a budget. The Democrat Senate continues to obstruct and pass nothing of their own.”

This is factually incorrect. Every dime spent by the Federal Government in 2011 and 2012 was approved by both houses of Congress and signed by the president.

Bottom line is that nothing gets done or has gotten done on the debt and deficit.

The operative word is compromise. Without it nothing gets done unless one party controls the House, has 60+ votes in the Senate and controls the White House.

At present the deficit is still here and the debt is going up.

No Artificial Flavors

May 16th, 2012
6:13 am

No he was speaking specifically about the EU and this exact situation with Greece and even Portugal. However, the parallels to US while obvious were not mentioned. We have a chance to correct and reverse our debt situation with relative ease compared to the interconnected complexities the EU common currency zone faces. Yet, our Congress has done even less than most Eurozone governments to address our dire path. The left and the GOP pundents like to poo poo Paul Ryan’s plans but they are the most direct plans to address the situation ive seen.

Samantha

May 16th, 2012
6:53 am

The greeks decided to vote themselves benefits and services they could not afford and could not raise without driving off the productive class. The result is this mess with too many voters unwilling to make hard changes to entitlements and people in other countries unwilling to impoverish themselves to support the Greek welfare state.

Sounds like California.

Or the US

iggy

May 16th, 2012
7:04 am

France is the cause of this huge mess.

Lil' Barry Bailout (Revised Downward)

May 16th, 2012
7:07 am

jconservative: This is factually incorrect.
———–

Only if you consider must-pass omnibus spending bills that prevent the government from shutting down to be responsible budget planning.

Why does the Democrat Senate continue to obstruct the budget process?

Lil' Barry Bailout (Revised Downward)

May 16th, 2012
7:14 am

The Republicans have put forth a plan to responsibly reduce Obozo’s un-American deficits and passed it in the House. Where is the Democrat plan?

Illegal Alien

May 16th, 2012
7:56 am

Kyle,
Suggest you adopt Jim Galloway’s rules for civility. Many posters here deal in insults and derogatory name calling. They don’t have much credibility.

Aside from that, the kind of division in Greece where compromise is a dirty word, is similar to what happening in this country.

We better be careful or we may be next.

jconservative

May 16th, 2012
8:15 am

“Only if you consider must-pass omnibus spending bills that prevent the government from shutting down to be responsible budget planning.”

I do not.

Nor do I consider the 25 of the 28 budgets passed between 1981 and 2009 responsible budget planning.

Starting in 1981 Congress and the president decided that they could reduce government revenue, increase government spending and the deficit would go away and debt would disappear. I call that irresponsible budgeting.

No, that’s wrong. I call that dumb.

But it is what happened.

iggy

May 16th, 2012
8:27 am

Perhaps the US Grand Poobah, Barry Obama, could go over to Greece and finish running them in the ditch. No doubt the Greecians would love him and his philosphy of economical/moral bankruptcy.

Lil' Barry Bailout (Revised Downward)

May 16th, 2012
8:57 am

Revenue went up when Our Presidents Reagan and W. Bush lowered tax rates.

It was, is, and continues to be the spending, stupid.

And when it comes to compromise, it’s difficult to compromise with the blank stares that constitute the Democrat response to Obozo’s un-American trillion-plus annual deficits.

Tiberius - Banned from Bookman's and proud of it!

May 16th, 2012
9:26 am

There is a time and place for compromise in legislative endeavors, but the only ones who are taking this U.S. debt issue seriously are the Republicans right now. What Democrats have to realize is that their “slowing the growth of government” position isn’t sufficient enough to contain out of control spending.

There was a time when this type of compromise might have worked but our debt situation is too far gone. It MUST be reduced. If not, we could take the whole worldwide economy down with us.

southpaw

May 16th, 2012
9:53 am

saywhat@6:34

Some conservative comments and some liberal comments by other bloggers and, fortunately, only one instance of poo-throwing so far.

globalfailure

May 16th, 2012
9:54 am

Bush’s foreign policy is responsible for the entire Euro debacle. Directly and solely. He shouldn’t aughta have crossed the Rubicon in iraq. I mean, look what happened to Caesar when he waded into his own river he shouldn’t aughta have done.

Tiberius - Banned from Bookman's and proud of it!

May 16th, 2012
10:04 am

“Bush’s foreign policy is responsible for the entire Euro debacle.”

The whole “Bush’s fault” meme is getting so old, globalfailure.

If by your follow-on comments you believe that Bush invading Iraq directly or indirectly negatively affected the economy of Europe, you’re going to have to make a better case than “Bush did it”.

iggy

May 16th, 2012
10:04 am

“Bush’s foreign policy is responsible for the entire Euro debacle.”

Bush huh. You mean to say the EuroTrash are relieved of all responsbility?

Jack

May 16th, 2012
10:11 am

“Subsidizing failure”. That’s what going on here in the states. Big time. And there are those that will vote for Obama again for his promises of “Fairness”.

globalfailure

May 16th, 2012
10:28 am

No, sir. Bush’s unjustified, and morally bankrupt invasion and subsequent slaughter of innocents led to our own bankrupcy and thus, the global connection of bank to bank conspiracies and panicked collusions caused a global infection of debt, risk, and then led to the ill-advised remedy of global government subsidies. War is hell. It is used only as a last resort, and then only to preserve our liberty. Iraq was a war of opportunity caused by Ike’s nemesis, the MIC. Cheney is the face of the MIC. he stands up there with stalin, hitler and atilla the hun as the 4 most warmongering jackazzes in history. Bush was too poor a leader to stand up to cheney, that’s all.

A trillion badly needed dollars were sunk into a hole in the iraqi desert benefiting nobody but the Saudi Defence Industry, (the saudi royal family).

The world may grow out of this mess. The alternative is probably impossible. The world’s population has too many good minds thinking our way out of this. But the fact that we’re in it this deep is bush’s fault: The child king who led us down the primrose path.

History will say it better than me. Long after we’re all on the ash heap of history.

iggy

May 16th, 2012
10:35 am

I see, and hows that medical marijuana working for ya?

Tiberius - Banned from Bookman's and proud of it!

May 16th, 2012
10:46 am

Globalfailure, you DO realize that we were accumulating debt before, during and after the invasion if Iraq, don’t you?

You DO realize that Europe was doing the same as well, don’t you?

destin dawg

May 16th, 2012
11:00 am

consider liberal vs. conservative… California = Greece by the Pacific ocean.. big gov’t.. high taxes.. labor unions… anti business.. high unemployment… then look at Texas… limited gov’t… low taxes… pro business.. low unemployment..