Tag Archives: Grexit

NEW GERMAN COALITION TO INCREASE MILITARY STRENGTH

Angela Merkel and Martin Schulz

Europe remains in a continual state of flux.   The UK is leaving the EU and facing an uncertain future.  The EU must punish Britain. It cannot afford to let the UK succeed outside of the Union, or others may follow her through the “exit” door.   Greece is finally coming out of years of serious economic troubles.   Eastern European nations are at variance with Germany over immigration.   Austria has a new conservative government that includes the right-wing Freedom Party.   Always remember, when looking at Europe, that the turmoil the continent is now going through will lead to the fulfillment of the following prophecy.

“The ten horns which you saw are ten kings who have received no kingdom as yet, but they receive authority for one hour as kings with the beast.  These are of one mind, and they will give their power and authority to the beast.” (Revelation 17:12-13)

GERMAN COALITION

It looks as if Mrs. Merkel’s Christian Democratic Union (supposedly a conservative party) is going to be able to form a coalition with the left-of-center Social Democrats, led by Martin Schulz.   This combination is referred to as a Grand Coalition, bringing two opposing parties together again.

“One downside to the grand coalition is that it leaves the right-wing nationalist Alternative for Germany (AfD), which made a surprisingly strong showing in September’s polls, as the largest opposition party, giving it a number of advantages including public funding and leadership roles in some parliamentary committees.  The AfD, the closest thing to Nazis to win seats in the Bundestag since the actual Nazis, ran a racially inflected populist campaign that capitalized on widespread anxieties about the influx of refugees and migrants from the Muslim Middle East, which the AfD said were threatening both Germany’s national security and its national identity.”  (“Germany’s political turmoil is bad news for Europe,” Jonah Shepp, New York magazine, 1/16/18).

Looking to the future, Mr. Shepp wrote:

“Part of Merkel’s problem is that she represents a waning generation of political leadership whose preference for moderation and incremental progress is being rejected in favor of bold new ideas on both the right and the left.   German voters flocked to smaller parties in September, particularly the AfD and FDP, while the Greens and the Left made gains among younger voters.

“Younger members of Merkel’s own conservative party have been urging her step aside, while a rising generation of leaders is waiting in the wings to succeed her.   The most talked-about potential successor is 37-year-old Jens Spahn, an openly gay man who has criticized Merkel from the right on immigration issues.   Another name that comes up is Ursula von der Leyen, the current defense minister, whose positions are more liberal.

“The other mainstream parties are also looking at generational transitions:   CSU chairman Horst Seehofer is handing the Bavarian premiership over to Markus Söder, 18 years his junior, while many Social Democrats are looking to oust their leader Martin Schulz after their disappointing performance in September.”

The composition of the new coalition means there will be fireworks ahead as each party wants different things.   It’s not likely the government can stay together very long.   That also means Mrs. Merkel’s future is uncertain and will be short-lived.   She has been Chancellor for over twelve years.

Change is likely not far off.

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GERMAN REARMAMENT

Meanwhile, the German World Socialist website is warning that the new German government plans a massive expansion of its military. (This is exactly what President Trump has been demanding, that Germany spend at least 2% of its GNP on defense.)

Incoming German government plans massive military rearmament   By Johannes Stern                                                                                                           3 January 2018 * World Socialist Web Site

Extracts:

“At the beginning of December, in a keynote address to the Körber Foundation in Berlin, Social Democrat Sigmar Gabriel demanded that after seven decades of relative foreign policy restraint, Germany return to an independent foreign and military policy – supported by a militarized European Union under German leadership.   “Now we realize that even with great economic prosperity in our country there is no comfortable place on the side-lines of international politics for us anymore.   Neither for us Germans nor for us Europeans,” he declared provocatively.

“Significantly, the SWP, which is close to the government, has once again submitted a paper titled “Dissolution or Replacement?   The International Order in Transition,” which openly makes the case for the establishment of a new world order under German-European leadership.   Above all, it considers China and the US, with or without Trump, as international rivals.

“ . . . The entire paper makes clear that the ruling classes in Germany and Europe are again preparing for a new major war. “

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BREXIT

The Brits are on their way out and leaving the EU with an almighty headache about money.   Rows over the common pot of cash in the EU27 will be about €13bn a year more painful after the UK blows a hole in the budget after 2020.   (FT Brussels Briefing, 1/9)

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GREECE’S 8 YEARS OF AUSTERITY UNDER GERMAN DIRECTION IS ALMOST OVER

It’s a Grexit with a difference. 2018 should be the year Greece ends eight years of economic tutelage, closing a chapter on an extraordinary period in the EU’s financial crisis fight.

August is the planned exit date and Greece’s Syriza government has been quietly crossing the t’s and dotting the i’s on its €86bn bailout ahead of the summer. In a familiar ritual, the Greek parliament this week passed its last mountain of sweeping reforms – touching everything from energy markets to trade unions – to unlock its latest dose of rescue money.   Eurozone finance ministers should sign off on the penultimate bailout review on Monday.

In one last act of defiance, thousands of protesters gathered outside the Greek parliament to vent their rage against labour laws that make it harder for trade unions to call strikes. “The law is totally undemocratic, a form of modern slavery” the head of Greece’s public sector union told The Guardian‘s Helena Smith.  (FT Brussels Briefing, 1/17)

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STRATFOR’S PREDICTION FOR NEW YEAR

2018 Annual Forecast – North Korea’s likely achievement of a viable nuclear deterrent next year will give rise to a new and more unstable era of containment.   As the specter of war looms in the Asia-Pacific, China and Russia will band together while the United States cracks down even harder on Iran — as well as its own trade partners.  (Stratfor 1/17)

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ISRAEL EXPELLING 10,000 AFRICAN IMMIGRANTS

Israel launches plan to expel thousands of African migrants                4 Jan 2018

Jerusalem – Israel on Wednesday began implementing a plan to force tens of thousands of African migrants out of the country by April, threatening to arrest those who stay.  “This plan will get under way today,” Prime Minister Benjamin Netanyahu said at the start of a cabinet meeting.  Under the programme, some 38,000 migrants who entered Israel illegally, mainly Eritreans and Sudanese, will have until the end of March to leave.  Each will receive a plane ticket and $3,500 to do so.   After the deadline, this amount will decrease and those who continue to refuse to go will face arrest.  Holot, an open facility in Israel’s desert south that can host 1,200 migrants who are allowed to leave to work during the day, is also set to be closed. Netanyahu pledged to “return south Tel Aviv to the citizens of Israel”, adding that the Africans were “not refugees but illegal infiltrators.”

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BECOME LIKE LITTLE CHILDREN

Our youngest grandson, not even two yet, already knows a lot more than most politicians, judges and liberal intellectuals in the western world.

Hayden has it down pat.  He knows to go to either Mom or Grandma when he wants food or needs his diaper changed; he’s also learned, when he wants fun, that Dad or Grandpa are the go-to people.

If a 20-month-old toddler can clearly distinguish gender roles, why can’t judges, politicians and lawyers?

They would do well to ponder the following words of Jesus Christ:

… Jesus called a little child to stand among them. “Truly I tell you, He said, “unless you change and become like little children, you will never enter the kingdom of heaven. Therefore, whoever humbles himself like this little child is the greatest in the kingdom of heaven.

(Matthew 18:2-4)

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FOUR LETTER WORDS

I took my wife and daughter to see a movie today.   On the way there, our daughter was doing a crossword on her phone.   She suddenly said:   “I need a four lettered word.”   I suggested she call the White House!

It’s ironic that the bad word President Trump allegedly used to describe African countries and Haiti has some truth to it.   We lived in Africa for over ten years.  During that time, we hosted many western visitors, both black and white.   The one thing everybody complained about was the toilet facilities – or, rather, the lack of them.

This does not mean that there is nothing positive to say about Africa. As I often remarked to visitors:   “we can teach them a lot about plumbing, but we can’t teach them anything about relationships. That’s where they can teach us.”

Back to Trump’s expletive.   Both Richard Nixon and his predecessor LBJ used a lot of bad language.  I suspect every president has since, to one degree or another.

 

Whenever I hear certain words, I am reminded of what my old English teacher said over fifty years ago.   “People who use bad language have a limited vocabulary with which to express themselves!”   There’s a lot of truth in that.

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MORE IGNORANCE

Senator Jeff Flake (Arizona Republican) has compared President Trump to Josef Stalin.

This kind of ignorance is appalling and dangerous.

Trump has his problems, but he cannot be equated with Stalin, a dictator who killed millions of people in his own country.   Millions more were sent to their deaths in the gulags.

Additionally, ordering the murders of five of his top nine generals prior to World War II meant the country was almost defeated by the German army.   The death toll from this alone was twenty million.

Senator Flake should not be allowed back into Congress until he has read all three volumes of Alexander Solzhenitsyn’s “Gulag Archipelago.”   This would give him a much better idea of Russia’s reality under Uncle Joe.

Others who have compared Trump to Hitler should be assigned William Shirer’s “The Rise and Fall of the Third Reich.”

Unfortunately, ignorance does not preclude entry into Congress!  If anything, it helps.

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Israeli Mayors Rail Against Law Limiting Commerce on Shabbat   11 Jan 2018 * JNS.org 

Dozens of mayors across Israel vowed on Tuesday to fight the country’s new law limiting commerce on Shabbat, saying they will not enforce it.   The controversial “supermarkets bill” passed in the Knesset with a razor-thin majority of 58-57 on Tuesday morning. The law, an amendment to the Local Authorities Law’s provisions on the operation of local businesses on days of rest, gives the interior minister the power to shutter businesses that choose to remain open on Shabbat.   During the past few weeks, Israeli municipalities have raced to bypass the looming supermarkets law, passing and bolstering bylaws allowing businesses to remain open on Shabbat.

“The supermarkets bill is meaningless.  It is up to the mayors to enforce it and I say in no uncertain terms that I have no intention of sending inspectors to enforce it,”  Ramat Gan Mayor Yisrael Zinger said Tuesday.   “We are a liberal city, and we believe in allowing people to live their lives according to their own beliefs.  This is what creates the fabric of life in the city,” he said.   Prior to the vote on the bill, Holon Mayor Moti Sasson pledged “to do everything within my power to preserve the status quo in the city, as part of which some businesses will be open on Shabbat for the benefit of the residents.” Givatayim Mayor Ran Kunik also announced he would not enforce the new law, telling reporters he is determined to preserve the status quo in his city.   “Givatayim knows what’s best for its residents better than any minister,” he said.  

 

 

 

 

 

 

 

 

 

 

 

 

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FINANCIAL CHAOS AROUND THE WORLD

Euro crisis

Wednesday was quite a day on financial markets around the globe.

China’s stock market continued to lose considerable value, down about a third in three weeks.   Uncertainty over the future of Greece within the euro rocked European stock exchanges. And a technical glitch caused problems on the New York Stork Exchange, the world’s biggest.

The latter was resolved before the closing bell.   Greece should be resolved by the weekend.   China, the number two economic power, poses the greatest threat to the world’s economy.   There are increasing fears that the Chinese stock markets are one big giant ponzi scheme, with nothing tangible to support them.

Late Thursday Greece handed over proposals to its European partners that will, hopefully, end the crisis affecting the beleaguered country.

Greece was a member of the euro from the very beginning, using the new European banknotes and coinage from day one on January 1st, 2002.   Today, the euro is used by nineteen European countries. Euro notes are used daily by more people than the US dollar.  The two currencies are the two most important currencies in the world and are used as payment for most international trading.

When Greece joined the euro, it was suddenly able to borrow vast amounts of money, which it did. It was not all used wisely.   Following the crash of 2008, the country soon found itself unable to repay its loans. The dream currency had become a nightmare for the Greek people. Austerity was forced on the country by European bankers, making life very difficult for the average citizen.   Austerity led the country into a downward spiral, which has recently been speeding up.

In January, the left-wing Syriza party won the election, promising an end to austerity.    However, European bankers, anxious to get their money back, want to impose greater austerity as a condition for offering Greece more help.   Without help, Greece will not be able to stay in the euro.

Without a doubt, Greek governments have been reckless.   Government employees can retire at 48 on generous pensions. Corruption is rife, as also is tax avoidance.

Germany is owed 68 billion euros by Greece, France 65 billion (add 10% to get the US dollar equivalent).   Other countries have loaned lesser amounts.   Total Greek debt amounts to 323 billion euros.   Greece is asking for a further bailout of 53.5 billion.

Although there is much talk of the Greek crisis, in a sense this is not about Greece, so much as Germany.   Germany’s conservative government is taking a hard line, refusing to cancel debt or extend further loans.   The Germans want their money back, on time.   Germany’s stance is setting a precedent that will no doubt be repeated if any other country in the eurozone gets into trouble.   Many have pointed out that when Germany was suffering economically after World War II, European finance ministers, including the Greek finance minister, generously cut Germany’s debt by 50%.   If Germany would reciprocate now, Greece would be fine.

The Greek people voted in a referendum a few days ago, rejecting the austerity demands placed on them by Germany and others. However, they still want to remain in the eurozone, which is an apparent contradiction.   If they leave the eurozone, they could restore their former currency, the drachma, but this would cut them off from many of the benefits of the eurozone.   Business loans and mortgages in euros would have to be paid back in ever depreciating drachmas, leading to many foreclosures.  Importers would have to pay upfront in euros, which may be hard to get if Greece leaves the eurozone.

Nobody wants a “Grexit” (a Greek exit from the euro), but it may not be possible to avoid it if the Greeks are unwilling to make the necessary structural changes to keep them in the euro.

This crisis is not the only crisis facing Europe at this time.   The continent is having to work through a number of challenges all at once.

The migrant crisis is the second biggest issue confronting the European Union.   So many people are fleeing from the Middle East and Africa into Europe that social cohesion is becoming a serious issue.   One consequence of this massive movement of people is the rise of right-wing parties opposed to immigration.

Ukraine is a third challenge for Europe.   Russia’s invasion of parts of Ukraine threatens the peace of Europe.

The possibility of Britain leaving the EU comes in at number four.

There’s even a fifth challenge, and that’s the relationship between European countries and the United States.   France and Germany are both upset over the American NSA spying on them and their leaders, even though it’s quite likely they are doing the same to America.

Depending on how each of these issues is resolved, Europe could be very different in the near future.

INTERNATIONAL NEWS DESK

syriza

Syriza was described on the BBC World Service this morning as a “very left-wing party.”   It looks as if it will come to power in Greece this Sunday, January 25th.

The big issue, as is common in western democracies, is the economy.   In the case of Greece, this means austerity, which, in turn, means the euro.

In May, 2010, faced with imminent national bankruptcy, the European Central Bank, the European Union and the International Monetary Fund (the so called troika) bailed out the small Mediterranean country, while imposing strict austerity on the Greeks.   Austerity measures were increased in 2011 resulting in very high unemployment, especially amongst the young.   The measures were extremely unpopular.   Much of the blame was given to the euro, Germany and Angela Merkel.

Today, Syriza is threatening to unilaterally halve the debt, to end Greece’s national “humiliation” and if necessary, to leave the euro. Angela Merkel has indicated she is ok with a Grexit, the term being used for a Greek exit.

One concern is that, if one country withdraws, others will follow.   The eurozone could unravel.   Although not a member of the eurozone, Great Britain could pull out of the EU, which, again, might influence others.

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King Abdullah of Saudi Arabia died yesterday, automatically succeeded by his half-brother King Salman.   Little change is likely in the kingdom in the immediate future.   The two kings come from a total of 45 brothers and half-brothers.   However, King Salman, aged 79, is likely the last of the present generation.

King Abdullah’s passing is ill-timed.   He has been king since 2005 and before that was de facto monarch for ten years as the previous king had suffered a serious stroke.   So, for twenty years, he has been the most powerful man in Saudi Arabia and a major figure in the Middle East.   His knowledge and experience will be sorely missed.

This is a challenging time for the Arabian peninsula, home of Al-Qaeda in the Arabian Peninsula (AQAP), perpetrators of the Paris terror attack.   Yemen’s pro-American government resigned this week as rebels seized the capital.   At the same time, another neighbor, Oman, will soon lose its leader, the pro-western Sultan Qaboos, who is now 74 and has been suffering from an undisclosed medical condition, which has resulted in him being rarely seen in public.

King Abdullah has been involved in bringing down the price of oil.   If the king had wanted to, he could have reversed the falling price simply by cutting Saudi production, but he didn’t.

He has also played a major role in supporting western efforts at fighting IS (Islamic State) and supporting Sunni rebels against Syria’s leader, who is allied to Saudi Arabia’s enemy, Shia Iran.   It should be noted here that Iran’s leader will attend a memorial for King Abdullah tomorrow.   Under Islamic custom, the king was buried today.

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Tomorrow is the 50th anniversary of the death of Sir Winston Churchill. He died on 24th January 1965.

His official biographer is Sir Martin Gilbert.   Sir Martin spends two months every year at conservative Hillsdale College in Michigan, where he lectures on Churchill.   He has willed his extensive Churchill library to the college.

A few years ago, a student invited me to go with him to one of the lectures.

I asked Sir Martin to sign my copy of his one volume book on Churchill, which he gladly did.   I also took the opportunity to ask him a question:   “If Churchill had never lived, what would have happened in World War Two?”   His response was:   “We wouldn’t have gotten very far.”   His lecture that evening illustrated his point.

That evening’s talk was on the sinking of the French fleet after the fall of France.

Churchill ordered that the fleet should be sunk so that it would not fall into the hands of the Germans.   Hundreds of French naval personnel died in the British attack on the fleet.   The incident remains controversial to this day.   Not only did it deny the Germans the use of the fleet, it had the added side benefit of convincing US President Franklin Roosevelt to back Churchill.    He was now convinced that the British war-time leader would stop at nothing to win the war.

The western world desperately needs a Churchill now.