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Greek Parliament Votes to Keep Greece Locked in its Debt Trap

Amidst growing protests Greek parliament votes more austerity to appease its creditors as Greece again runs out of money.

Alexander Mercouris

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Quietly and with none of the public drama of the first half of 2015 Greece is slipping back into crisis.

The cause of the crisis is the same as always.

Greece is bankrupt.  During the property and credit boom that led up to the 2008 crisis it took on far more debt than it could pay.  However instead of being allowed to default or to agree an IMF monitored restructuring with its creditors, Greece in order to remain in the eurozone borrowed more money from the EU’s institutions to pay its debts, which were only partly reduced.  As a condition for this lending the EU institutions – led by German Chancellor Merkel who organised the original bailout – insisted Greece impose harsh austerity on itself so that it could achieve the budget surplus needed to repay the extra debt.

As at the great majority of economists who looked at this situation predicted, this austerity led directly to a collapse in investment and demand as both were strangled by a host of new taxes and benefit cuts insisted upon by Merkel and Greece’s EU creditors.  These have caused the economy to spiral down into recession, with Greece’s euro membership allowing for no countervailing relief such as might have been provided by depreciating the currency. 

The recession has in turn cut tax receipts whilst increasing spending by more than the EU institutions allowed for, causing Greece to miss its budget targets.  That in turn has meant that Greece regularly finds itself with insufficient money to pay the creditor institutions – the EU and the IMF – the instalments it owes on its existing loans. 

Greece has accordingly been forced to turn repeatedly to its institutional creditors – the EU and the IMF – to ask for more money.  After fraught negotiations the money – or enough of it to enable Greece to get through the immediate crisis – is provided.  However Greece is obliged in return to agree to yet more austerity, causing the whole process to repeat itself. 

In the meantime, as the economy contracts and the lending increases, the debt burden on the country grows greater.

This is the cycle Greece has been trapped in ever since it negotiated its first bailout in 2009.

Its causes are twofold: the refusal of its EU creditors led by Germany’s incompetent Chancellor Angela Merkel to allow Greece any debt relief whilst it remains in the eurozone – resulting in impossible demands being made of the country – and the corresponding refusal of the Greek elite – backed by the most vocal part of the Greek population – to consider any alternative to remaining in the eurozone despite the impossibly harsh austerity this is imposing on the country. 

Disastrously, instead of either party rethinking its approach in light of the repeated failure, they simply blame each other, with the Germans and the EU criticising the shiftless Greeks and the Greeks complaining the Germans and the EU have let them down by refusing to pay for them to remain in the eurozone.

Though this cycle has repeated itself continuously since 2009, it appeared to come close to breaking last year after the election of the radical leftist Syriza government. 

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For a few fraught months it seemed as if Syriza, led by its Prime Minister Alexis Tsipras and his finance minister Yanis Varoufakis, was prepared to break the cycle. 

Varoufakis very publicly challenged the entire economic logic of a strategy that had obviously failed  and which was causing severe hardship in Greece.  His over-confident theatrical personality, his unorthodox negotiating tactics, and his habit of telling his EU colleagues to their faces things they didn’t want to hear, however simply managed to turn the EU leaders against him despite the obvious truth of much of what he was saying.

Eventually the EU’s most powerful finance minister, Germany’s Wolfgang Schauble, proposed that Greece exit the eurozone so that it could sort itself out outside it. This would have come with a debt holiday and a 50 billion euro sweetener to help Greece ride out the storm that would have resulted.

Despite a referendum result in Greece that seemed to give Tsipras and Varoufakis the political cover they needed, it turned out that Tsipras was as committed to Greece’s euro membership as the rest of Greece’s elite. 

Instead of embracing Schauble’s proposal he rejected it, accepting yet another bailout brokered by Italy and France, which kept Greece in the eurozone but which came with more commitments to yet more austerity.

The cycle that Greece has been trapped in since the first bailout in 2009 therefore was simply perpetuated.

What was extraordinary about this last bailout which Tsipras agreed to last summer was that – as I and many others said at the time – it was even more detached from reality than all the others.    Its demands and its targets are so obviously unachievable – making it only a question of time before it unravels – that even one of the creditor institutions that is supposed to be supporting the bailout – the IMF – has publicly said it has no belief in it.  It is calling for Greece to be granted the debt relief the EU refuses to grant it and says the primary budget surplus target the bailout requires Greece to achieve should be reduced to more realistic levels. 

These are essentially the same demands Varoufakis was making last year, which the EU leaders led by Merkel and Schauble summarily rejected.  Latest indications are they reject them still.

This explains the situation in Greece now.  The looming crisis point is July when Greece has to pay debt instalments of more than $3 billion.  It lacks the money to do this and is therefore obliged to enact more legislation increasing taxes and cutting pensions in order to get more bailout funding released.

On Sunday after a heated debate that is what the Greek parliament agreed to do. 

It did so in a way that shows the levels of absurdity and cynicism to which Greek politics have sunk. 

Tsipras – once the champion of the Greek left, elected just over a year ago to end austerity – supported measures that will deepen the austerity. 

His opponents in the fervidly pro-EU conservative New Democracy party opposed him in the parliament though the measures he proposed perpetuate an austerity they supported when in government and which is demanded by the EU, which they support.

Greece’s fundamental problem – and Europe’s – is that there is no obvious way out of this crisis. 

At a time when German politicians are criticising the European Central Bank for its loose monetary policies and are even blaming it for causing the rise of the anti-immigrant AfD, any proposal to write off Greek debt or to soften the demands on Greece – as demanded by the IMF – would be guaranteed to provoke uproar in Germany.  It is doubtful that Chancellor Merkel – her political position weakened by the migrant crisis – could persuade her CDU party to agree to it. Her CSU coalition partner would almost certainly oppose it.

In Greece meanwhile – though opinion polls show support for the country’s euro membership to have sunk to unprecedentedly low levels – since Tsipras’s 2015 U turn no viable political force prepared to challenge the orthodoxy by contemplating a euro exit exists.  An attempt by a breakaway group of former Syriza insiders led by former parliamentary speaker Zoe Konstantopoulou and former energy minister Panagiotis Lafazanis to create such a force has ended in a split.  It is not yet clear whether in the event of new elections any of the politicians involved in this group would gain election to the parliament, and even if they did they would only be a small minority of the parliament with little influence.

Despite angry protests in Greece and the growing disillusion of the IMF the endless nightmare that is the Greek crisis therefore seems set to continue.

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European Court of Justice rules Britain free to revoke Brexit unilaterally

The European Court of Justice (ECJ) ruled that Britain can reverse Article 50.

RT

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The UK is free to unilaterally revoke a notification to depart from the EU, the European Court has ruled. The judicial body said this could be done without changing the terms of London’s membership in the bloc.

The European Court of Justice (ECJ) opined in a document issued on Monday that Britain can reverse Article 50, which stipulates the way a member state leaves the bloc. The potentially important ruling comes only one day before the House of Commons votes on Prime Minister Theresa May’s Brexit deal with the EU.

“When a Member State has notified the European Council of its intention to withdraw from the European Union, as the UK has done, that Member State is free to revoke unilaterally that notification,” the court’s decision reads.

By doing so, the respective state “reflects a sovereign decision to retain its status as a Member State of the European Union.”

That said, this possibility remains in place “as long as a withdrawal agreement concluded between the EU and that Member State has not entered into force.” Another condition is: “If no such agreement has been concluded, for as long as the two-year period from the date of the notification of the intention to withdraw from the EU.”

The case was opened when a cross-party group of British politicians asked the court whether an EU member such as the UK can decide on its own to revoke the withdrawal process. It included Labour MEPs Catherine Stihler and David Martin, Scottish MPs Joanna Cherry Alyn Smith, along with Green MSPs Andy Wightman and Ross Greer.

They argued that unilateral revocation is possible and believe it could provide an opening to an alternative to Brexit, namely holding another popular vote to allow the UK to remain in the EU.

“If the UK chooses to change their minds on Brexit, then revoking Article 50 is an option and the European side should make every effort to welcome the UK back with open arms,” Smith, the SNP member, was quoted by Reuters.

However, May’s environment minister, Michael Gove, a staunch Brexit supporter, denounced the ECJ ruling, insisting the cabinet will not reverse its decision to leave. “We will leave on March 29, [2019]” he said, referring to the date set out in the UK-EU Brexit deal.

In the wake of the landmark vote on the Brexit deal, a group of senior ministers threatened to step down en masse if May does not try to negotiate a better deal in Brussels, according to the Telegraph. The ministers demanded that an alternative deal does not leave the UK trapped within the EU customs union indefinitely.

On Sunday, Will Quince resigned as parliamentary private secretary in the Ministry of Defense, saying in a Telegraph editorial that “I do not want to be explaining to my constituents why Brexit is still not over and we are still obeying EU rules in the early 2020s or beyond.”

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Seven Days of Failures for the American Empire

The American-led world system is experiencing setbacks at every turn.

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Authored by Federico Pieraccini via The Strategic Culture Foundation:


On November 25, two artillery boats of the Gyurza-M class, the Berdiansk and Nikopol, one tugboat, the Yany Kapu, as well as 24 crew members of the Ukrainian Navy, including two SBU counterintelligence officers, were detained by Russian border forces. In the incident, the Russian Federation employed Sobol-class patrol boats Izumrud and Don, as  well as two Ka-52, two Su-25 and one Su-30 aircraft.

Ukraine’s provocation follows the advice of several American think-tanks like the Atlantic Council, which have been calling for NATO involvement in the Sea of Azov for months. The area is strategically important for Moscow, which views its southern borders, above all the Sea of Azov, as a potential flash point for conflict due to the Kiev’s NATO-backed provocations.

To deter such adventurism, Moscow has deployed to the Kerch Strait and the surrounding coastal area S-400 batteries, modernized S-300s, anti-ship Bal missile systems, as well as numerous electronic-warfare systems, not to mention the Russian assets and personnel arrayed in the military districts abutting Ukraine. Such provocations, egged on by NATO and American policy makers, are meant to provide a pretext for further sanctions against Moscow and further sabotage Russia’s relations with European countries like Germany, France and Italy, as well as, quite naturally, to frustrate any personal interaction between Trump and Putin.

This last objective seems to have been achieved, with the planned meeting between Trump and Putin at the G20 in Buenos Aires being cancelled. As to the the other objectives, they seem to have failed miserably, with Berlin, Paris and Rome showing no intention of imposing additional sanctions against Russia, recognizing the Ukrainian provocation fow what it is. The intention to further isolate Moscow by the neocons, neoliberals and most of the Anglo-Saxon establishment seems to have failed, demonstrated in Buenos Aires with the meeting between the BRICS countries on the sidelines and the bilateral meetings between Putin and Merkel.

On November 30, following almost two-and-a-half months of silence, the Israeli air force bombed Syria with three waves of cruise missiles. The first and second waves were repulsed over southern Syria, and the third, composed of surface-to-surface missiles, were also downed. At the same time, a loud explosion was heard in al-Kiswah, resulting in the blackout of Israeli positions in the area.

The Israeli attack was fully repulsed, with possibly two IDF drones being downed as well. This effectiveness of Syria’s air defenses corresponds with Russia’s integration of Syria’s air defenses with its own systems, manifestly improving the Syrians’ kill ratios even without employing the new S-300 systems delivered to Damascus, let alone Russia’s own S-400s. The Pantsirs and S-200s are enough for the moment, confirming my hypothesis more than two months ago that the modernized S-300 in the hands of the Syrian army is a potentially lethal weapon even for the F-35, forbidding the Israelis from employing their F-35s.

With the failed Israeli attack testifying to effectiveness of Russian air-defense measures recently deployed to the country, even the United States is finding it difficult to operate in the country. As the Washington-based Institute for the Study of War confirms:

“Russia has finished an advanced anti-access/area denial (A2AD) network in Syria that combines its own air defense and electronic warfare systems with modernized equipment. Russia can use these capabilities to mount the long-term strategic challenge of the US and NATO in the Eastern Mediterranean Sea and the Middle East, significantly widen the geographic reach of Russia’s air defense network. Russia stands to gain a long-term strategic advantage over NATO through its new capabilities in Syria. The US and NATO must now account for the risk of a dangerous escalation in the Middle East amidst any confrontation with Russia in Eastern Europe.”

The final blow in a decidedly negative week for Washington’s ambitions came in Buenos Aires during the G20, where Xi Jinping was clearly the most awaited guest, bringing in his wake investments and opportunities for cooperation and mutual benefit, as opposed to Washington’s sanctions and tariffs for its own benefit to the detriment of others. The key event of the summit was the dinner between Xi Jinping and Donald Trump that signalled Washington’s defeat in the trade war with Beijing. Donald Trump fired the first shot of the economic war, only to succumb just 12 months later with GM closing five plants and leaving 14,000 unemployed at home as Trump tweeted about his economic achievements.

Trump was forced to suspend any new tariffs for a period of ninety days, with his Chinese counterpart intent on demonstrating how an economic war between the two greatest commercial powers had always been a pointless propagandistic exercise. Trump’s backtracking highlights Washington’s vulnerability to de-dollarization, the Achilles’ heel of US hegemony.

The American-led world system is experiencing setbacks at every turn. The struggle between the Western elites seems to be reaching a boil, with Frau Merkel ever more isolated and seeing her 14-year political dominance as chancellor petering out. Macron seems to be vying for the honor of being the most unpopular French leader in history, provoking violent protests that have lasted now for weeks, involving every sector of the population. Macron will probably be able to survive this political storm, but his political future looks dire.

The neocons/neoliberals have played one of the last cards available to them using the Ukrainian provocation, with Kiev only useful as the West’s cannon fodder against Russia. In Syria, with the conflict coming to a close and Turkey only able to look on even as it maintains a strong foothold in Idlib, Saudi Arabia, Israel and the United States are similarly unable to affect the course of the conflict. The latest Israeli aggression proved to be a humiliation for Tel Aviv and may have signalled a clear, possibly definitive warning from Moscow, Tehran and Damascus to all the forces in the region. The message seems to be that there is no longer any possibility of changing the course of the conflict in Syria, and every provocation from here on will be decisively slapped down. Idlib is going to be liberated and America’s illegal presence in the north of Syria will have to be dealt with at the right time.

Ukraine’s provocation has only strengthened Russia’s military footprint in Crimea and reinforced Russia’s sovereign control over the region. Israel’s recent failure in Syria only highlights how the various interventions of the US, the UK, France and Turkey over the years have only obliged the imposition of an almost unparalleled A2AD space that severely limits the range of options available to Damascus’s opponents.

The G20 also served to confirm Washington’s economic diminution commensurate with its military one in the face of an encroaching multipolar environment. The constant attempts to delegitimize the Trump administration by America’s elites, also declared an enemy by the European establishment, creates a picture of confusion in the West that benefits capitals like New Delhi, Moscow, Beijing and Tehran who offer instead stability, cooperation and dialogue.

As stated in previous articles, the confusion reigning amongst the Western elites only accelerates the transition to a multipolar world, progressively eroding the military and economic power of the US.

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Is Silicon Valley Morphing Into The Morality Police?

Who gets to define what words and phrases protected under the First Amendment constitute hate — a catchall word that is often ascribed to any offensive speech someone simply doesn’t like?

The Duran

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Authored by Adrian Cohen via Creators.com:


Silicon Valley used to be technology companies. But it has become the “morality police,” controlling free speech on its platforms.

What could go wrong?

In a speech Monday, Apple CEO Tim Cook said:

“Hate tries to make its headquarters in the digital world. At Apple, we believe that technology needs to have a clear point of view on this challenge. There is no time to get tied up in knots. That’s why we only have one message for those who seek to push hate, division and violence: You have no place on our platforms.”

Here’s the goliath problem:

Who gets to define what words and phrases protected under the First Amendment constitute hate — a catchall word that is often ascribed to any offensive speech someone simply doesn’t like?

Will Christians who don’t support abortion rights or having their tax dollars go toward Planned Parenthood be considered purveyors of hate for denying women the right to choose? Will millions of Americans who support legal immigration, as opposed to illegal immigration, be labeled xenophobes or racists and be banned from the digital world?

Yes and yes. How do we know? It’s already happening, as scores of conservatives nationwide are being shadow banned and/or censored on social media, YouTube, Google and beyond.

Their crime?

Running afoul of leftist Silicon Valley executives who demand conformity of thought and simply won’t tolerate any viewpoint that strays from their rigid political orthodoxy.

For context, consider that in oppressive Islamist regimes throughout the Middle East, the “morality police” take it upon themselves to judge women’s appearance, and if a woman doesn’t conform with their mandatory and highly restrictive dress code — e.g., wearing an identity-cloaking burqa — she could be publicly shamed, arrested or even stoned in the town square.

In modern-day America, powerful technology companies are actively taking the role of the de facto morality police — not when it comes to dress but when it comes to speech — affecting millions. Yes, to date, those affected are not getting stoned, but they are being blocked in the digital town square, where billions around the globe do their business, cultivate their livelihoods, connect with others and get news.

That is a powerful cudgel to levy against individuals and groups of people. Wouldn’t you say?

Right now, unelected tech billionaires living in a bubble in Palo Alto — when they’re not flying private to cushy climate summits in Davos — are deciding who gets to enjoy the freedom of speech enshrined in the U.S. Constitution and who does not based on whether they agree with people’s political views and opinions or not.

You see how dangerous this can get — real fast — as partisan liberal elites running Twitter, Facebook, Google (including YouTube), Apple and the like are now dictating to Americans what they can and cannot say online.

In communist regimes, these types of folks are known as central planners.

The election of Donald Trump was supposed to safeguard our freedoms, especially regarding speech — a foundational pillar of a democracy. It’s disappointing that hasn’t happened, as the censorship of conservative thought online has gotten so extreme and out of control many are simply logging off for good.

A failure to address this mammoth issue could cost Trump in 2020. If his supporters are blocked online — where most voters get their news — he’ll be a one-term president.

It’s time for Congress to act before the morality police use political correctness as a Trojan horse to decide our next election.

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