Portugal and EU loans

I run through the paper briefly in the morning. There was an article about Portugal. The government there is reluctant – to say the least – to take the EU loan to save it from its perceived misery. I haven’t the motivation and the time to follow up on it, I rather blog than read today but nevertheless those couple of lines got me thinking.

Last year, or was it already the year before when Greece fell in? There was rumours in the papers of some mysterious attack on the Euro as a currency and gloom and doom that the EU project shall fail and blahblahblah.

Should there have been some conspiracy on the Euro that would have probably a single and well known purpose and that is to maintain the dollar’s hegemony for the dollar’s hegemony is what maintains the US’s hegemony. So long as we all trade in that currency, especially the important stuff and especially the most important stuff (oil) no country has any alternative but to keep it’s savings and consequently its investments in US dollars. Thus, the world finances the US economy.

For some time there has been wondering about the potential of another currency, such as the Euro to challenge this status quo. Imagine if that happened! When repaying US debt wouldn’t just mean printing more money. Anyway, in Capitalism there are periodic crisees and whatever way they happen, either brought on by purpose or by ‘accident’ there are some who will move in to reap some benefits, hence Portugal must take EU loans.

Similiarily to Greece, Hungary and a bunch of others, hopefully the more the merrier. The more countries in the EU borrow from the EU and the more money they borrow the less sense the idea of pooled sovereignty start to make. Supposedly in the EU the states are more or less on equal terms. But what if half them owes money, a lot of it to the other half? Or even better this is administered by some central body that is intrigued, not only intrigued but created and run by fundamentalist of Thatcherite ideologies? Well, empire building at its most contemporary design. when those not wanting to fall in line are faced with the prospects of such behaviour making their loans increasingly expensive, they will learn the ‘common’ songs to sing, and do what they are told from Brussels.

And now I sound like a classic euro sceptic. But I am not. I am all for the good stuff but we shall not mix European integration with empire building. There is a clear difference.

And maybe I am running too far on a couple of lines. Maybe Portugal is really desperately needing this loan only if its government wasn’t packed by idiots... but I suspect it isn’t in hungary only that once again we need to learn to read between the lines.

'Peoples of Europe, Rise Up!'

Here is a story, sort of hypothetical but perhaps rather real.
Let’s say that you are a janitor of a cooperative housing estate. You are entrusted to run the finances on the estate as well. Every so often the residents vote to keep you in position or put someone else there.

I talk my friend into talking you into joining the accounting system of a large cooperation of coop housing. The reasoning is hard to resist, your cooperative will get some benefits, security, insurance of some sort and it will be easier take on loans for all kind of projects. And surely, through your mastermind management some of your local labourers will benefit with juicy contracts to fix the elevator or repaint the corridors or with the easy loans you can even make up some projects for them, build a new corridor for the fun of it. The local contractors will love you and buy you lots of beer and paint your house for free and things like that. Then import contractors from elsewhere and they will be even more generous in thanking for your wonderful management.

To make sure the residents feel they are getting something you can buy them free plants and contribute to their new patios.
In this process you will have become a corrupt janitor. Good. The cycle of debt can continue easily. Why not build something pointless like a Circus tent? Lots of contracts.

Once the housing coops of which you are the caretaker of is sufficiently indebted I will start getting concerned about the coop’s ability to pay it back. The local banks listening to me will be hesitant to loan more to the coop, to finance debt. Dubious Internet banks and the bookies will take over with an increase, heavy increase in interest rates.

This development will of course sink you more in debt that is even more difficult to finance and I will start telling all my friends and even foes that I think your little coop is in trouble. But I will do nothing because my friends and foes actually make good money on your coop. So far loaning money benefited them and of course all the building contracts too. You are getting desperate so you think of going to the mob to ask for money to be able to pay back some of those nasty loans. I know a guy, my uncle, he can help, I say and you follow the advice.
Now, you and your coop are owned, literally.

The story of Greece.

Put it yet simpler,
You wanna borrow a fiver to buy toys for your kids, I tell you I wont give you a fiver but I will give you a tenner instead and a couple extra pounds as a present for beer. Sure you take it. Especially so that I threaten telling shit about you to everyone in the neighbourhood. The next day I’m knocking on the door for the 12 pounds I gave you the day before. Plus some extra beer money for me. You don’t have it...

What should happen... hm.... perhaps I could take the telly and the food from the fridge? Oh, you don’t have food than, here, a couple of pounds for food for the kids and some for paying the interest on the previous one...
All this because you wanted to have a beer.

I read up news from the US. They think that Greece is in serious debts because of the evil welfare state.

I understand, that the US is the most heavily indebted country on the globe, and its people are the most indebted people in the world while they have no welfare state, certainly not what we in Europe define us such.

It’s a lot about maintaining hegemony, forcing all other governments of the world to finance US debt which partially causes their spiralling into debt. Of course independent from economical thus political hegemony of the USA contemporary banking is designed to spiral anyone who uses money into debt. The moment you hold a note you are in debt (the money can be gotten out of central banks only through borrowing).

Naturally, sooner or later every debtor will fall under the pressure. Especially so that events are carefully orchestrated to create the circumstances, than they spiral out of control. Greece is graded down, so its debts become more expensive, so it might fail to pay them, so Greece is graded down even more thus its debts become even more expensive and it almost sure will fail to pay them... Hey, this is a fun game! Let’s try what happens if we do this on Spain, then Portugal, then Poland, then... hm.

It’s an attack on the Euro, the EU if you like. Machiavelli is alive and kicking by the way.

The saddest thing however is the incredible lack of sympathy. How people elsewhere respond to this,
We are swallowing neoliberal restructuring of education system here in Finland without a whimpering noise, so should you Greece! We are swallowing deep budget cuts in Hungary, so should you Greece! We are working more hours for less pay here in Germany, so should you Greece (if you lucky enough to keep your job)!
Hang on for a minute! What if they got it right? What if the point ‘fuck the system!’ actually makes sense? After all it is a system that is specifically designed to create this kind of crises and if the crisis fails to come than it will be triggered institutionally.

Perhaps the Greeks got it right. Perhaps rioting on the street is the only thing that is left, or so some feels, to do. Perhaps things got out of hand. People are dead. Violence has its consequence. Probably it shouldn’t have gotten this far. Probably your news portal and your media outlet, wherever you are doesn’t bother for a second about the ongoing institutional, state violence that has been going on for the past so many months. Actually it has started even earlier I think. Greek seems to be the Anti-capitalist hot spot of Europe these days. Sorry Iceland. But I mean not to find excuses for anyone, simply say that various forms of violence and terrorism, spontaneous and rebellious clashing with state legislated has been going on for a long time over there. As said before, violence has its consequence.

Anti-Capitalists are enemies of the system and are treated as such. Anti-Terrorism legislation has been exploited to use against peaceful and not so peaceful, but usually mostly peaceful or pacifist protesters in the UK far more than against suspected terrorists. In fact, the greatest benefit of those legislations that they can be used, and violent so, against anti-capitalist. It is them who are the true enemies of the capitalist state anyway.

Some things never change. The class struggle, the struggle between various modernist views, is on. It flickers on.

The rest of Europe is standing by, watching as another slave is beaten back into the line. In fact, we might offer a helping hand even. Comments on newspaper articles bash on the Greeks. ‘It’s all their fault, the lazy bums!’ So they claim. Quietly happy probably that it isn’t they who are there. But don’t worry; we all will have our turns, soon enough.