Talk Elections

General Politics => Economics => Topic started by: Tender Branson on January 30, 2012, 03:23:10 AM



Title: Germany wants to take control of the Greek budget ?!
Post by: Tender Branson on January 30, 2012, 03:23:10 AM
Germany has confirmed it drafted proposals to intervene directly in the Greek budget if it consistently fails to implement reforms.

European sources confirmed the plan yesterday, saying "several ideas are being discussed on how to react to a programme which is consistently off-track".

"If the Greeks aren’t able to succeed themselves with this, then there must be stronger leadership and monitoring from abroad, for example through the EU," said German economics minister Philip Rössler, the first member of chancellor Angela Merkel’s cabinet to confirm the proposal to appoint a "budget commissioner".

"We need more leadership and monitoring when it comes to implementing the reform course." Though the proposals would apply to all programme countries with a backed-up reform programme, the paper is focused on Greece as it struggles to cope with its €350 billion debt mountain.

Amid repeated failures to meet the terms of its current programme, agreed with EU partners, Athens is currently negotiating a second €130 billion package and a debt restructuring plan with its private creditors.

The German plan, leaked to the Financial Times , says that, "given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time."

European officials say a central problem is Greece's decentralised budget structure, which makes it "near-impossible for Athens to exercise fiscal discipline".

http://www.irishtimes.com/newspaper/breaking/2012/0129/breaking1.html?via=rel


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Marokai Backbeat on January 30, 2012, 03:27:52 AM
Stuff like this is why my view on the EU has cooled considerably in the last year or two.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Tender Branson on January 30, 2012, 03:33:45 AM
While they are at it, they can manage the Carinthian budget too if they want to ... ;)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on January 30, 2012, 04:04:49 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on January 30, 2012, 05:29:02 AM
would be ok if the german budget were also controlled by the EU.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Insula Dei on January 30, 2012, 09:56:12 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on January 30, 2012, 11:24:20 AM
While this is a very bad idea, one has a great deal of sympathy for the German position. They deprived themselves the most, and are opening their pockets for other countries, and still get attacked.

The problem is not this country, or that country, it's a faulty conception of economics that says austerity and other contractionary measures will lead to growth.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Franzl on January 30, 2012, 11:36:36 AM
Haven't I suggested Germans and Austrians run budgets in the EU before? :)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Tender Branson on January 30, 2012, 11:52:48 AM
Haven't I suggested Germans and Austrians run budgets in the EU before? :)

Why should we Austrians run it ? We have other stuff to do. Let the Luxembourgers or the Finns do it, or outsource it to the Swiss ... ;)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: True Federalist (진정한 연방 주의자) on January 30, 2012, 11:55:35 AM
Aren't options 1 and 2 essentially the same?  After all, given the current situation, EU control would only be a fig-leaf for German control.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on January 30, 2012, 02:29:47 PM
Control by the Merkel regime is hardly the same thing as German control.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: TheDeadFlagBlues on January 30, 2012, 05:49:31 PM
The EU is the reason why austeritymania is out of control.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Jerseyrules on January 30, 2012, 11:40:40 PM
My opinion: the Germans and Brits have pulled all the weight in the EU from Day 1, and Germany is pulling all the weight in the euro.  If Germnay pulled out, the whole system would collapse like a house of cards (as it should.) 


Call me old-fashioned, but Merkel should grow a pair...wait, did I type that out loud, or were we all thinking it? ;)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on January 31, 2012, 07:41:14 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.

They couldn't do this without the EU (and they wouldn't because there would be no reason). I prefer to deal in realities of what the EU actually is rather than in ideals of what it would be in my fantasy-land. :P


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on January 31, 2012, 08:28:16 AM
My opinion: the Germans and Brits have pulled all the weight in the EU from Day 1

Someone doesn't know sh!t about the postwar history of Europe...


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Insula Dei on January 31, 2012, 08:59:25 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.

They couldn't do this without the EU (and they wouldn't because there would be no reason). I prefer to deal in realities of what the EU actually is rather than in ideals of what it would be in my fantasy-land. :P

Trying to look at what goes wrong and from there formulating goals for the future (i.e. strengthenin' the common institution at the expense of the influence of the larger member states) isn't constructing a fantasy land.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on January 31, 2012, 09:01:52 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.

They couldn't do this without the EU (and they wouldn't because there would be no reason). I prefer to deal in realities of what the EU actually is rather than in ideals of what it would be in my fantasy-land. :P

Trying to look at what goes wrong and from there formulating goals for the future (i.e. strengthenin' the common institution at the expense of the influence of the larger member states) isn't constructing a fantasy land.

But the EU, as it is, is this. It's not as if there is another EU out there where France and Germany do not call the shots. Nor is such an entity particularly feasible.

And as I said, the reason why they want to control Greece's budget is because of the euro. Otherwise this wouldn't even be an issue. Trying to pretend as if this is unrelated to the EU and would not happen if there was more EU is...well. I'm not sure what to call it.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on January 31, 2012, 09:25:11 AM

The problem is not this country, or that country, it's a faulty conception of economics that says austerity and other contractionary measures will lead to growth.

this 'conception of economics' didn't emerge in a vacuum.  it dates back to the 70s, when the precedent was set in these situations to privilege creditors over citizens in cases of excessive sovereign debt.  and it continues to today.  the austerity policies are backed by finance capital (and their shill media) with the intent of keeping inflation near zero at all costs, as to not deflate the value of their interest payments.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on January 31, 2012, 09:27:41 AM

The problem is not this country, or that country, it's a faulty conception of economics that says austerity and other contractionary measures will lead to growth.

this 'conception of economics' didn't emerge in a vacuum.  it dates back to the 70s, when the precedent was set in these situations to privilege creditors over citizens in cases of excessive sovereign debt.  and it continues to today.  the austerity policies are backed by finance capital (and their shill media) with the intent of keeping inflation near zero at all costs, as to not deflate the value of their interest payments.
This.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Filuwaúrdjan on January 31, 2012, 09:32:41 AM
My opinion: the Germans and Brits have pulled all the weight in the EU from Day 1

Someone doesn't know sh!t about the postwar history of Europe...

Oh wow.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Insula Dei on January 31, 2012, 09:41:52 AM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.

They couldn't do this without the EU (and they wouldn't because there would be no reason). I prefer to deal in realities of what the EU actually is rather than in ideals of what it would be in my fantasy-land. :P

Trying to look at what goes wrong and from there formulating goals for the future (i.e. strengthenin' the common institution at the expense of the influence of the larger member states) isn't constructing a fantasy land.

But the EU, as it is, is this. It's not as if there is another EU out there where France and Germany do not call the shots. Nor is such an entity particularly feasible.


The US, as it is, is as it is now. It's not as if there's some US out there that doesn't run massive deficits, assures all of its citizens affordable healthcaren and has outlawed the death penalty. Nor is such an entity entirely feasible. It'd be better if we just disbanded the US.

I really don't get what point you're trying to make. I'm not claiming the EU isn't what it is, I'm claiming it has the possibility to be so much more than it is, which is the fundamental aspiration of all politics. (Except maybe for the reactionary variant).


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on January 31, 2012, 01:06:17 PM
Anyone who claims the EU is a threat to national soverignty is a nationalist scare-mongerer who has read too may British tabloids /everyone about 5 years ago

;)

Well, clearly the threat here is Germany, rather than the EU. The real story of the crisis is one of Germany and France behaving as if the union is just an extension of their own national sovereignty. Merkozy is the thing you ought to be railing against Gustaf, not the European Institutions, which are too weak to act on their own.

They couldn't do this without the EU (and they wouldn't because there would be no reason). I prefer to deal in realities of what the EU actually is rather than in ideals of what it would be in my fantasy-land. :P

Trying to look at what goes wrong and from there formulating goals for the future (i.e. strengthenin' the common institution at the expense of the influence of the larger member states) isn't constructing a fantasy land.

But the EU, as it is, is this. It's not as if there is another EU out there where France and Germany do not call the shots. Nor is such an entity particularly feasible.


The US, as it is, is as it is now. It's not as if there's some US out there that doesn't run massive deficits, assures all of its citizens affordable healthcaren and has outlawed the death penalty. Nor is such an entity entirely feasible. It'd be better if we just disbanded the US.

I really don't get what point you're trying to make. I'm not claiming the EU isn't what it is, I'm claiming it has the possibility to be so much more than it is, which is the fundamental aspiration of all politics. (Except maybe for the reactionary variant).

Eh, that's not a valid analogy. The US has outlawed the death penalty before, for example. Whereas the EU has never been democratic or functioning. Nor has it ever been a guarantor of Greek sovereignty.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on January 31, 2012, 02:12:28 PM
The problem is not this country, or that country, it's a faulty conception of economics that says austerity and other contractionary measures will lead to growth.

this 'conception of economics' didn't emerge in a vacuum.  it dates back to the 70s, when the precedent was set in these situations to privilege creditors over citizens in cases of excessive sovereign debt.  and it continues to today.  the austerity policies are backed by finance capital (and their shill media) with the intent of keeping inflation near zero at all costs, as to not deflate the value of their interest payments.

Beautifully put, absolutely correct.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Link on January 31, 2012, 02:28:14 PM
The EU is the reason why austeritymania is out of control.

Wrong.

Austeritymania is something that has been preached by western first world countries to poor third world countries around the world for decades.  It was out of control a long time ago.  Asking public school teachers who retired at 50 to accept a reasonable pension and having wealthy Greeks with yachts actually pay some taxes is mild compared to what we asked third world countries to do.  I think Europeans and Americans bitching about paying taxes and accepting reasonable cuts is the height of arrogance and hypocrisy.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: k-onmmunist on January 31, 2012, 03:54:09 PM
Stuff like this is why my view on the EU has cooled considerably in the last year or two.

You finally saw sense? :P


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Jerseyrules on February 02, 2012, 01:55:18 AM
My opinion: the Germans and Brits have pulled all the weight in the EU from Day 1

Someone doesn't know sh!t about the postwar history of Europe...

Alright, but in the last 20 years?  Come on.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Sam Spade on February 27, 2012, 12:03:57 AM
Why would anyone think that Germany is going to let the EU (which it basically runs along with France) throw infinite sums of money down the bottomless black hole that is Greece without any consequences? 

And since Greece has no way to get funding otherwise, what are its other options, default?  Of course, I support that option, but once we start down that road, lots of other things will start occurring. 

Of course, we're going down that road eventually anyways, and it's probably better to do it now than later, so...


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Sam Spade on February 27, 2012, 12:08:31 AM
I do want to add one other thing - at this point, any Greek bailouts will primarily consist of funds going to European banks (i.e. a backdoor bailout), tending to be those of French origin, so I might urge the supposedly enlightened folks on this forum to come to an actual conclusion that doesn't involve unicorns or griffins with regard to this development.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 07, 2012, 11:39:29 AM
Germany has confirmed it drafted proposals to intervene directly in the Greek budget if it consistently fails to implement reforms.

European sources confirmed the plan yesterday, saying "several ideas are being discussed on how to react to a programme which is consistently off-track".

"If the Greeks aren’t able to succeed themselves with this, then there must be stronger leadership and monitoring from abroad, for example through the EU," said German economics minister Philip Rössler, the first member of chancellor Angela Merkel’s cabinet to confirm the proposal to appoint a "budget commissioner".

"We need more leadership and monitoring when it comes to implementing the reform course." Though the proposals would apply to all programme countries with a backed-up reform programme, the paper is focused on Greece as it struggles to cope with its €350 billion debt mountain.

Amid repeated failures to meet the terms of its current programme, agreed with EU partners, Athens is currently negotiating a second €130 billion package and a debt restructuring plan with its private creditors.

The German plan, leaked to the Financial Times , says that, "given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time."

European officials say a central problem is Greece's decentralised budget structure, which makes it "near-impossible for Athens to exercise fiscal discipline".

http://www.irishtimes.com/newspaper/breaking/2012/0129/breaking1.html?via=rel

Germans like to take control of things.  Once in a while it spills over into military campaigns, but after two really big losses in the early 20th Century, the Germans figured out that their best bet for rule of the European continent was through its economic power.  But even here they have over-reached.  The German-controlled European currency unit is no more sustainable than an armed struggle against a Europe united against Germany. 

Of course, given its investment, Germany is right to want to control the Greek economy.  Greece would do well to simply opt out of the Eurozone altogether.  Germany could also offer some incentives to help Greece smooth its transition toward the Drachma.  The short-term consequences would be harsh for Greece, but in the long run both Greece and Germany would be better off. 

The Eurozone would probably be sustainable if limited to a few rich countries such as Germany, Austria, the Low Countries, and Scandanavia.  Maybe even throw in the Hanseatic city of Danzig.  And call it something other than the Eurozone.  How about "The Fourth Reich?" 


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 08, 2012, 06:20:45 PM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Tidewater_Wave on March 08, 2012, 07:55:30 PM
Whose going to take over our budget after more wreckless spending?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on March 08, 2012, 08:59:51 PM
Whose going to take over our budget after more wreckless spending?

'Reckless' is the word you're looking for, young whipper-snapper, though the phrase 'woefully inadequate' would be more apropos.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 08, 2012, 09:30:27 PM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.

Noted and well-publicized.  No doubt, I remember well reading opinion polls at the time that 67% of the public was against it, yet the bundesstag passed it anyway.  Yes, the German people knew that they would end up paying for it.  I suspect that the German people, deep down, have always known that they'd end up paying for the grand ambitions of their late-unifying imperialist government.

I also remember a slate of articles, mostly emanating from the UK and the US, about how it was still possible for the Germans to defeat the european currency unit.  A handful of very rich Germans, with some help from a handful of very rich Americans and Englishmen, could defeat the euro by offering up a private currency, provided that the majority of Germans who protested the Euro could be persuaded to pressure their government to allow a second (private) currency to compete with the Euro.  The idea is that the private currency would become more greatly accepted in Germany, making its backers rich and eventually outpacing the Euro to the point where the Euro would fold, but because the Germans would have vested so much in the private currency by then, it could easily be exchanged for Neue Deutschemarks that they would not experience much loss (compared to what they would have lost by sticking with the Euro.)  A grand scheme, and one that never came to fruition.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 08, 2012, 10:25:26 PM
Whose going to take over our budget after more wreckless spending?

No one. We have our own currency, so we will never be in the position of Greece.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on March 09, 2012, 07:06:19 AM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.
Who exactly are you calling "Germany" here? Not our governing classes - the people who're using it right now to plunder everything of value in Greece in an unholy alliance with eurosceptic popular sentiment.
It's true that such sentiment about the currency ever existed, and polls never showed majority support for it. Though what would have happened with a referendum and a referendum campaign, no one can say for certain. Mostly because such things do not exist here.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on March 09, 2012, 04:00:21 PM
Whose going to take over our budget after more wreckless spending?

No one. We have our own currency, so we will never be in the position of Greece.

more relevantly, we have the most potent system of organized violence ever known to man, which means universal annihilation would occur prior to the realization of T_W's fantasy.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 09, 2012, 04:16:00 PM
Whose going to take over our budget after more wreckless spending?

No one. We have our own currency, so we will never be in the position of Greece.

more relevantly, we have the most potent system of organized violence ever known to man, which means universal annihilation would occur prior to the realization of T_W's fantasy.

Well that too, but I would like to believe the US would not use violence, event to prevent something like a financial crisis.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on March 09, 2012, 04:17:49 PM
and I'd like to believe the Mets are the favorites to win the NL East in 2012.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 09, 2012, 05:44:07 PM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.
Who exactly are you calling "Germany" here? Not our governing classes - the people who're using it right now to plunder everything of value in Greece in an unholy alliance with eurosceptic popular sentiment.
It's true that such sentiment about the currency ever existed, and polls never showed majority support for it. Though what would have happened with a referendum and a referendum campaign, no one can say for certain. Mostly because such things do not exist here.

From what I understand there was considerable skepticism among the German elites as well (although not as much) but they went along with it in exchange for German unification.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 09, 2012, 09:09:42 PM
more relevantly, we have the most potent system of organized violence ever known to man

No, the Germans have us bested on that score as well.  

We like to think "We're Number One" in everything, but we're really not.  We're not even Number One in most things.  And fifty years from now, we probably won't be Number One in many things.



Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on March 09, 2012, 09:23:19 PM
more relevantly, we have the most potent system of organized violence ever known to man

No, the Germans have us bested on that score as well.  

We like to think "We're Number One" in everything, but we're really not.  We're not even Number One in most things.  And fifty years from now, we probably won't be Number One in many things.



lol you're delusional dude.  assuming you're being serious.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 09, 2012, 09:50:43 PM

lol you're delusional dude. assuming you're being serious.


Completely serious.

We need to start admitting that we're not as good at most things as we like to think we are.  Funny, it's not often the case that you have the need for a Republican to tell a non-Republican that.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on March 09, 2012, 09:54:45 PM
so Germany is better at organizing violence than the US.  I guess the use of the progressive tense could lead you to that in a useless fashion.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 09, 2012, 10:17:49 PM
You talking about nuclear weapons?  It's an accident of history, man.  We're a country of immigrants.  Who do you think gave us those?  They were guys with names like Oppenheimer.  Sure, the US government financed it.  That's what burgeoning empires do.  What was the name of that Berkeley physicist who used to say, "I love Hitler.  He shakes the tree, and we pick up the apples."  I guess it was a joint US-German effort, in that sense.  

You can't seriously think our method of organized violence--impressive though it is--compares with what the Germans have invented.  They're streamlined, man, and awesome (and I use the word in its true sense.)  They have sustained war on the rest of Europe for many years, twice in the past century, and going back five hundred years we see their technology at work on even a greater scale.  

There are also the individual cases.  Take nobel laurate Fritz Haber.  We usually remember him as the guy who invented a way to make ammonia in bulk, and therefore make fertilizer to feed the starving masses.  But he also gave us the munitions.  After all, ammonium nitrate isn't just for feeding vegetable plants.  He also invented the law CxT=k that allowed them to figure out how to gas people in the trenches in World War I.  His wife was so distraught over this that she committed suicide after he told her, "Death is death, baby."  Haber went on to invent some pretty nifty insecticides.  In his later years, he was director of the very, very prestigious Kaiser Wilhelm Institute for Physical Chemistry.  At some point, in about 1934, he was ordered to fire about half of his staff.  He got a list of men who were suspected or known Communists, Jews, members of the SDP, etc.  You know, the usual riff-raff.  These were tenured professors and well-respected friends of his.  He refused to do it, and chose to resign his own position  instead (and his pension in the process.)  He died six months later, a broken-hearted, impoverished, lonely man.  Ah, but his legacy lived on:  not only did he give the world a wonderful insecticide, known to us now as Zyklon B, but the equation with which engineers delivered it most effectively (vide supra.)

And Fritz Haber is one of but many examples we could name.  Germans are smart, man.  Never forget that.  Volkswagen, Bayer, I. G. Farben, BASF.  You name it, they can make it.

We, on the other hand, hold our troops up to ridicule.  A few rowdy privates take a piss on a statue of Mohammed and what do we do?  We court-martial them.  We observe those pesky Geneva conventions.  No wonder we're losing wars.  Do you think Hermann Goring would do that?  You can't conquer lesser races by pretending equality with them.  The Germans have always understood this.

Let us not distract ourselves by hijacking the thread.  This is a huge digression in an otherwise wonderful thread.  Go buy yourself some history books and educate yourself, man.  Let's not take a big dump on this thread just to fill in the gaps in your education.

Take it back to the issue:  should the Germans take over the Greek budget?  I say that they shouldn't have gotten in bed with the Greeks in the first place.  (And it's not too late for a divorce.)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: © tweed on March 09, 2012, 10:25:04 PM
I guess that's simply an 'angus post' that there's no serious benefit in trying to respond to.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on March 10, 2012, 06:34:12 AM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.
Who exactly are you calling "Germany" here? Not our governing classes - the people who're using it right now to plunder everything of value in Greece in an unholy alliance with eurosceptic popular sentiment.
It's true that such sentiment about the currency ever existed, and polls never showed majority support for it. Though what would have happened with a referendum and a referendum campaign, no one can say for certain. Mostly because such things do not exist here.

From what I understand there was considerable skepticism among the German elites as well (although not as much) but they went along with it in exchange for German unification.
Lol no. Unification and the Euro have nothing whatsoever to do with each other except being invented (in part) by the same people. First the one, then the other. Theo Waigel conquers the world.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on March 10, 2012, 06:53:48 AM
angus, regarding your claims about the German military - you're much overstating the case, and in after all it is merely a historical case - Tweed was not wrong in claiming that right now, the US is enormously stronger than any other State. The greatest fascist/military power in human history by far is the one you call home - the Germans a mere also-ran, the Japanese a mere footnote, and the Chinese nothing more than a fanciful idea.

Leaving aside the fact Tweed was talking about the present, not ancient history, let me address the historical issue as well - not only was the US enormously more productive of military power than Germany during the second world war, it wasn't even the US that defeated them - it was Russia.  So, case closed - can't even beat Russia.

And don't worry to much about the old superpower in 50 years time  - reports of its decline are as always much exaggerated (after all speculation about radical change makes a better story than 'US will continue to be the central power in the world for the foreseeable future).


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 10, 2012, 01:15:36 PM
And don't worry to much about the old superpower in 50 years time  - reports of its decline are as always much exaggerated (after all speculation about radical change makes a better story than 'US will continue to be the central power in the world for the foreseeable future).

That much we can agree on.  In my lifetime, the United States' share of the world GDP has fallen from about 50% to about 20%.  The average male height in the US has gone from being the tallest to being the 17th tallest.  And there are a number of other indicators.

I also agree that no single power is poised to supplant us.  In 50 years, we will be in a period not unlike the early 1800s when no single nation dominated the others but that there are many states vying for power.  Some dying empires and some emerging ones, all itching for a fight.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on March 10, 2012, 05:15:58 PM
The average male height in the US has gone from being the tallest to being the 17th tallest.  And there are a number of other indicators.

Well, you know that impoverishing the vast majority is policy, angus - thus their shrinking stature.

All the countries that are taller on average than the US are Western Europeans who are simply more socialist and therefore in better overall condition.  Height is most likely a counter-indicator to power.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Franzl on March 10, 2012, 05:32:44 PM
We observe those pesky Geneva conventions.  No wonder we're losing wars.  

The US observes the Geneva conventions? Since when?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 10, 2012, 06:37:46 PM
We observe those pesky Geneva conventions.  No wonder we're losing wars.  

The US observes the Geneva conventions? Since when?

Yes, the only part of an otherwise strongly sophisticated post that struck out as surprising, if only because it was coming from a die hard Paulite. Then again, he is a Paulite who was a diehard neocon in 2003.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 10, 2012, 08:05:34 PM

/rolls eyes/

I was never a power projectionist.  I find it difficult to take any such accusation seriously, and I will assume for the moment that you're joking.  Or trolling.

As for the US armed forces observing rules of conduct, or prosecuting those who don't, then I'd say that, generally speaking, yes they do.  I realize that there have been some exceptions.  The Dachau massacre comes to mind.  The fifth army's commanders giving pistols to the liberated and letting them have a go at their captors.  And, to add insult to injury, they were acquitted upon court-martial.  I forget the details, but it was an egregious incident.

Of course, we also terrorized Dresden with our aerial assault.  And you can talk about other incidents.  Frankly, I think the way the Union and Confederate armies treated each other was appalling, although all that came before Geneva.  Come to think of it, our very nation was born of a violent, illegal insurrection.  And uncouth, at that.  Cornwallis was right to think the Yankee savage.

My point wasn't to defend the United States.  My point was very specific:  I was responding to the unambiguous, universally-quantified statement that we have the most "potent system of organized system of violence ever known to man."

I disagree.  

I do think that our most awe-inspiring act of organized violence was the total annihilation of Nagasaki and Hiroshima.  I recognize that there have been better body counts, both by the US and by others, but in terms of sheer organized violence that was probably the most impressive assault in our entire national history.  

I simply think that we have been bested.  In fact, in that same war both of our major enemies inflicted streamlined, unprovoked, no-looking-back assaults on their enemies, generally in Nanjing and in Poland, respectively, but elsewhere as well.  I think we never really exhibited that level of efficient, effective, sadistic violence.  And that's not necessarily a bad thing.  It's just my opinion, of course, but it's not spur-of-the-moment.  Certainly you are free to disagree.



Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 10, 2012, 10:13:27 PM

/rolls eyes/

I was never a power projectionist.  I find it difficult to take any such accusation seriously, and I will assume for the moment that you're joking.  Or trolling.

My apologies, upon some searching through the archives, you did in fact declare your opposition to the war. I was thinking of this post (https://uselectionatlas.org/FORUM/index.php?topic=1637.msg56236#msg56236), and making inferences based on a combination of your conversion to the GOP because it was the nationalist party, being a fan of Bush II, and what were the most salient issues at that time [December 29, 2003 being in particular a couple weeks after Saddam Hussein was captured, arguably the high point of neoconservative feeling in America, after April 2003]. In any case, I suspect that we largely agree in this discussion... as I was saying earlier. While the United States certainly possess the capability to destroy the world with our thousands of nuclear weapons, we may be a better country in that we would not actually do so in response to a threat by foreign investors to stop buying our bonds, which (a case can be made) makes us better than the organizers of the Holocaust and people who gang-rape women with bayonets. So I maintain in the end that our possession of our own currency is the main reason why we will not find ourselves in the same place as Greece.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 11, 2012, 11:07:31 AM
you did in fact declare your opposition to the war.

Only twice in my life have I felt so strongly motivated by an issue that I wrote to my US senators to instruct them in voting.  Once was in 1991, when I wrote Lloyd Bentsen and Phil Gramm, and asked them not to authorize force against Iraq, and again in 2002, when I wrote to Dianne Feinstein and Barbara Boxer and asked them not to authorize force against Iraq.  In each case I had one senator on my side and one against.  In each case the president's name was Bush.  In each case I was in the minority.  In each case I was opposed to elective wars.  I've been pretty consistently non-interventionist.

As for the German/Greek situation, I think that they're just wanting a return on their investment.  Obviously, it's an unreasonable demand, but you can't blame them for trying.  I'd like to see the whole currency unravel.  It would be painful at first, for markets worldwide, but in the end Germany and Greece would both benefit.  I was sad to see the Deutschmark disappear.  It has always been a stable currency and I'm something of a collector.  I have a number of commemorative and regular-issue BRD coins that I pulled from circulation the year that I lived in West Germany, and some DDR coins as well.  I also have some beautiful silver coins from the 1933-45 era, replete with hackenkreutz and eagle on the reverse and some politician's head on the obverse.  Additionally, I have a small number of pre-1918 coins as well, with the eagle wearing a crown on the obverse.  

You can tell quite a bit from a country's domestic situation by its coins.  The imperial period coins are of good quality.  Higher denominations in silver and lower demoninations in heavy transition metal alloys.  Nickel and zinc and such.  At some point, circa 1917, they start to get made of aluminum.  This is a tell-tale sign of stress.  (I don't have any of those 100 thousand Deutschmark notes with Martin Luther in 3/4 profile, from the Weimar Republic, but I've seen them in denominations as high as a million marks from the early- to mid-20s.)

Then, in the 1930s they go back to being good quality.  Paul von Hindenburg commemorative 2- and 5-Reichsmark pieces are silver, with lettered edges.  (Germans seem to prefer lettering and symbols rather than milling for edgework.)  Lower denomination pieces in grey transition metals.  1-, 2-, and 5-pfenning in copper or copper alloys.  Wheat encircling the reverse on them.  Not unlike the Lincoln cents 1909-59.  But then the coins go back to being ultracheap metals by around 1943.  (To be fair, the US used steel for cents that year as well, rather than copper, but we never went in for aluminum.)

By 1949 they're back on their feet.  From 1949-2001, lower denomination coins are alloys of zinc, a respectably heavy transition metal, and higher ones are alloys of nickel.  The obverse of the 1- and 2-mark coins feature the hungry German eagle.  The five-mark, especially, features a scrappy, ferocious eagle, prominently displaying razor-sharp talons.  His head is turned to the east and his mouth is wide open (as if to say, "Danzig ist Deutsch, bitches!")  Lots of commemorative pieces during that period as well.  I have a Max Planck 2 mark, an Albert Einstein 2 mark, and a 50th anniversary Institute of Archaeology 5-mark piece.  All nickel alloy, of course.  Gone is the silver and platinum, but to be fair the US also stopped minting our higher-denomination coins in silver by then.  My father was given a proof set of Bundeskanzlers 1949-79, in high silver content alloy.  I think they're five-mark pieces, but they were special issue, and I don't think you'd find them in circulation.

Meanwhile, during that period, DDR was minting prototypical socialist coins.  Aluminum and ultralightweight alloys, a sure sign of hard times.  Pick up a ten-pfenning piece from BRD and a ten-pfenning piece from DDR and weigh them in your hand, and even if you've never studied history or economics, you can immediately conclude that capitalism beats socialism.  Still, the hammer and compass symbols of workers united are very kitsch, so I like the DDR coins.

I also have a few bills.  20-, 10-, and 5-marks from the 70s.  I was never rich enough to pull much currency from circulation.  Same as my US collection:  It's mostly coins.  When I was a child and a stray silver certificate or United States Note would come my way, I'd pull it out if it's a 1-, 2-, 5-, 10-, or 20-dollar bill, but anything higher and, well, you know how it is.

Then, they disappear.  Abruptly.  Last time I was in Europe was the semester that I worked in Amsterdam, fall 2003.  (Netherlands had even more festive currency.  It's a damn shame that these were lost to history.)  I had a colleague from "die bijbel belt," that southern part of Netherlands near Limburgh where folks are brimstone Calvinist and dry.  He had a nice collection of pre-2001 Guilder notes and coins stashed away, but one day his wife found it and traded it for Euros.  She said, "...but they're worthless, useless.  I traded them for useful currency."  He was furious, and rightfully so!

I've collected the lower denominations of all the euro pieces from the various member states.  The obverses are all the same, but the reverse features a tribute to miguel cervantes, for spain, or a harp, for Ireland, etc., so there is some collectibility, but to be honest, they're not very pretty, and they don't tell much history, and there's not a plethora of collectibles.  Moreover, you no longer have the wonderful travelers experience of getting to exchange Deutschmarks for Guilders when you cross the border.  How sad is that?

Ah, well, you can still exchange Quetzales for Pesos when you drive north from Guatemala into Mexico, and you can still exchanges Colones for Lempiras when you drive from El Salvador into Honduras.  I have a fairly complete collection of coins and currency from those states as well.  Hopefully, we won't ever make the horrible decision to prop up Central America the way the Germans decided to prop up Southern Europe.  


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: True Federalist (진정한 연방 주의자) on March 11, 2012, 02:29:38 PM

By 1949 they're back on their feet.  From 1949-2001, lower denomination coins are alloys of zinc, a respectably heavy transition metal, and higher ones are alloys of nickel.  The obverse of the 1- and 2-mark coins feature the hungry German eagle.  The five-mark, especially, features a scrappy, ferocious eagle, prominently displaying razor-sharp talons.  His head is turned to the east and his mouth is wide open (as if to say, "Danzig ist Deutsch, bitches!")  Lots of commemorative pieces during that period as well.  I have a Max Planck 2 mark, an Albert Einstein 2 mark, and a 50th anniversary Institute of Archaeology 5-mark piece.  All nickel alloy, of course.  Gone is the silver and platinum, but to be fair the US also stopped minting our higher-denomination coins in silver by then.  My father was given a proof set of Bundeskanzlers 1949-79, in high silver content alloy.  I think they're five-mark pieces, but they were special issue, and I don't think you'd find them in circulation.


Until 1974 the 5 DM coin for general circulation was .625 silver.
()

The 1975 and later 5 DM coins were not.
()

(edited to fix image of silver 5 DM


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on March 11, 2012, 03:33:20 PM
Different sets of heads is definitely 2 Marks.

And since Ernest messed up on his image codes, here (http://www.chaoskalle.de/Bilder/DM/silberv.jpg) and here (http://www.chaoskalle.de/Bilder/DM/silberh.jpg) is the pre 75 silver five.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 12, 2012, 05:22:30 AM
Angus, it should be noted that Germany never wanted the euro. It was pushed on them against their will. They realized they would probably end up paying for it.
Who exactly are you calling "Germany" here? Not our governing classes - the people who're using it right now to plunder everything of value in Greece in an unholy alliance with eurosceptic popular sentiment.
It's true that such sentiment about the currency ever existed, and polls never showed majority support for it. Though what would have happened with a referendum and a referendum campaign, no one can say for certain. Mostly because such things do not exist here.

From what I understand there was considerable skepticism among the German elites as well (although not as much) but they went along with it in exchange for German unification.
Lol no. Unification and the Euro have nothing whatsoever to do with each other except being invented (in part) by the same people. First the one, then the other. Theo Waigel conquers the world.

Well, this is what Wikipedia says: "France and the UK were opposed to German reunification, and attempted to influence the Soviet Union to stop it.[7] However, in late 1989 France extracted German commitment to the Monetary Union in return for support for German reunification.[8]"

That's also the version of history I've heard generally. West Germany was similar in population to France, the UK and Italy so there was worry about a unified Germany being too powerful in the EU. It was thought that removing the D-mark would reduce that power.

What basis do you have for thinking this to be obviously untrue?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on March 12, 2012, 05:42:23 AM
The one where not any of the relevant decisions were in any way made or even much negotiated on between spring of 89 (adoption of the Delors Report, the earliest arguable point of no return) and sometime in 91 (Maastricht negotiations), obviously. Also, the one where Theo Waigel was one of the Euro's prime architects and cheerleaders.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 12, 2012, 07:07:18 PM

Well, this is what Wikipedia says: "France and the UK were opposed to German reunification, and attempted to influence the Soviet Union to stop it.[7] However, in late 1989 France extracted German commitment to the Monetary Union in return for support for German reunification.[8]"


Wikipedia?!  Really?

Well, anyway, that's the standard wisdom here.  It's what I've always heard as well.  Although, now that I know that this is what Wikipedia says I can't help but suspect its accuracy.

Gustaf, mere words cannot express my severe disappointment in you just now.  Please, don't ever begin a debate rebuttle by saying, "well, Wikipedia says..."

It's like saying, "Well, my grandmother, who dropped out of school in the seventh grade says.."

Actually, it's worse than that, because at least you know your grandmother.  At least you love her and can be excused for believing her.  But to quote some article in a non-scholarly, non-edited source, probably written by a seventh grader, is in bad form.

Trondheim wins this portion of the debate, no matter what you say now.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: minionofmidas on March 13, 2012, 08:17:49 AM
Especially when those two sentences look editted in by some agenda-pusher, given the way they break the paragraph's flow.

Thatcher, especially, wanted assurances that the new united Germany wouldn't be too independent. The Common Market is kinda sorta tied up with that in vague ways... but it's not nearly as clearcut as with German soldiers actually being involved in NATO operations as they never were before 1990. As to the currency... well you only need to remember British stances past present & future on the currency, and on French and German dominance in the EU, to realize the notion is a little far fetched.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on March 13, 2012, 12:05:41 PM

Wikipedia?!  Really?

Well, anyway, that's the standard wisdom here.  It's what I've always heard as well.  Although, now that I know that this is what Wikipedia says I can't help but suspect its accuracy.

Gustaf, mere words cannot express my severe disappointment in you just now.  Please, don't ever begin a debate rebuttle by saying, "well, Wikipedia says..."

It's like saying, "Well, my grandmother, who dropped out of school in the seventh grade says.."

Actually, it's worse than that, because at least you know your grandmother.  At least you love her and can be excused for believing her.  But to quote some article in a non-scholarly, non-edited source, probably written by a seventh grader, is in bad form.

You're being a snob, angus.  You are now playing a game called 'internet', and on this game, the wikipedia is the source of information.  Its like playing Scrapple using the Scrapple dictionary.  You really can't critique it for not being a 'real dictionary' when you already decided to play the game.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 13, 2012, 02:28:20 PM
You're being a snob, angus.  You are now playing a game called 'internet', and on this game, the wikipedia is the source of information.  Its like playing Scrapple using the Scrapple dictionary.  You really can't critique it for not being a 'real dictionary' when you already decided to play the game.

Very well, then I'm critiquing the players.  In any case I don't remember agreeing only to use the Scrapple dictionary.  I can't imagine I'd ever make such a concession in order to be allowed to play.

Also, the British stance is a little confusing.  Historically, they have voted not to adopt the Euro currency.  What they did last fall, though, was veto a bill which would allow the eurozone countries to use the institutions of the 27-member union to secure the 17 members who use the euro currency.  This made pretty big news here in the US, and affected the stock prices somewhat, but I never quite understood it all because there was an immediate press conference by France and Germany claiming that they'd circumvent the Brits.  How does all that work, anyway?  It seems that the British made a wise decision not to adopt the European currency unit, but it also seems that if they don't use the currency then they should forego any decision-making authority when it comes to the currency.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 13, 2012, 06:30:55 PM

Well, this is what Wikipedia says: "France and the UK were opposed to German reunification, and attempted to influence the Soviet Union to stop it.[7] However, in late 1989 France extracted German commitment to the Monetary Union in return for support for German reunification.[8]"


Wikipedia?!  Really?

Well, anyway, that's the standard wisdom here.  It's what I've always heard as well.  Although, now that I know that this is what Wikipedia says I can't help but suspect its accuracy.

Gustaf, mere words cannot express my severe disappointment in you just now.  Please, don't ever begin a debate rebuttle by saying, "well, Wikipedia says..."

It's like saying, "Well, my grandmother, who dropped out of school in the seventh grade says.."

Actually, it's worse than that, because at least you know your grandmother.  At least you love her and can be excused for believing her.  But to quote some article in a non-scholarly, non-edited source, probably written by a seventh grader, is in bad form.

Trondheim wins this portion of the debate, no matter what you say now.


Haha, very funny. :P

Wikipedia is usually a decent indicator of what is considered mainstream views, unless it's an article that has just been hacked or is about something completely obscure. I don't think either is true in this case.

I'd also like to point out that I didn't say "I am right, because Wikipedia says..." or anything like that. I merely pointed to this piece of information.

Also, I don't get your confusion on the UK's actions. They're not part of the euro so they don't want to pay for it. What's wrong with that?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 13, 2012, 06:34:25 PM
Anyway,

http://en.mercopress.com/2010/09/28/german-unification-conditioned-to-acceptance-of-euro-reveal-documents (http://en.mercopress.com/2010/09/28/german-unification-conditioned-to-acceptance-of-euro-reveal-documents)

"Deceased French president Francois Mitterrand in 1989 gave his approval to German unification on condition that then Chancellor Helmut Kohl opened the way for the creation of an only currency in the European Union."

"The magazine supports the facts with statements from then Mitterrand advisor and later Foreign Affairs minister Hubert Védrine, who said that the French president would not accept German unification, divided since the end of WW2, unless it was coupled to European integration which necessarily implied monetary union and a single currency."

"The former President of the Bundesbank Karl Otto Pöhl was even clearer, stating: 'The European monetary union would not have come about without German reunification and vice versa.'"

Here's an English link to the Spiegel article: http://www.spiegel.de/international/germany/0,1518,719940,00.html (http://www.spiegel.de/international/germany/0,1518,719940,00.html)


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 13, 2012, 08:22:04 PM
Wikipedia is usually a decent indicator of what is considered mainstream views, unless it's an article that has just been hacked

If you walk up to a great work of art and start cutting at it unskillfully, it's hacking (and you may be charged with destruction of public property.)  If you walk up to a pile of rubble that has little value and start hammering on it unskillfully, it's not hacking (and you may be commended by the park officials by helping to eliminate unsightly garbage.)

Also, I don't get your confusion on the UK's actions. They're not part of the euro so they don't want to pay for it. What's wrong with that?

I guess that's my entire understanding of it as well, in a nutshell.  They like the good trade deals but don't want any of the mess.  Maybe there's really nothing more to it.



Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Tidewater_Wave on March 14, 2012, 12:00:31 AM
Whose going to take over our budget after more wreckless spending?

No one. We have our own currency, so we will never be in the position of Greece.

more relevantly, we have the most potent system of organized violence ever known to man, which means universal annihilation would occur prior to the realization of T_W's fantasy.

Well that too, but I would like to believe the US would not use violence, event to prevent something like a financial crisis.

I hope not too. We are pretty reckless though.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 14, 2012, 11:22:44 AM
I hope not too. We are pretty reckless though.

There's a school of thought that argues that it isn't reckless to stimulate the economy by big government projects.  There's some evidence for, and some against, the argument that government spending mitigates a recession.  Really well-informed guys like Paul Krugman and Milton Friedman argue for and against, respectively, this case.  I'm not sure I buy into all the arguments on either side, but if you genuinely conclude that free market capitalism has failed, and that priming the pump, so to speak, can stimulate the economy, then the spending isn't all reckless.

I'm convinced that the following were bad expenditures:  The invasion and occupation of Iraq, Cash for Clunkers, and the continued occupation of Afghanistan.

I'm leaning toward judging the following expenditures to be wasteful, but I might be convinced otherwise:  the October 2008 bank bailouts, The Patient Protection and Affordable Care Act, the Bush tax cuts, the extension of the Bush tax cuts, government loans to Solyndra and other troubled companies, and various disaster aid bills.

I was against these expenditures but have begun lately to think that they might have been the right thing overall:  the General motors bailout, unemployment benefits extension, and various natural disaster aid bills.

Of course, much of this comes under grand omnibus bills and you could pick it apart in more detail, but those are the ones I could think of off the top of my head.

I'd also judge the Greenspan/Bernanke weak dollar policy to reduce the trade deficit to be reckless.  In this regard I suppose that I'm an ideological Paultard, but that's monetary policy, not spending, so it may not be related to your point.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 14, 2012, 12:16:23 PM
Out of curiosity mostly, do you consider the trade deficit to be a problem? And if it is, how could it be remedied, unless other currencies rise in value relative to the dollar?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Tidewater_Wave on March 14, 2012, 12:23:19 PM
Maybe they just need a loan from fannie and freddie. We saw how well that worked here.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 14, 2012, 01:16:04 PM
Out of curiosity mostly, do you consider the trade deficit to be a problem? And if it is, how could it be remedied, unless other currencies rise in value relative to the dollar?

Obviously, that's one of the arguments in favor of currency manipulation.  However, a weak dollar policy as a response to a trade deficit is rather like taking a cough drop to cure an infection.  Know what I mean?  The trade deficit is a natural consequence of the fact that investment in the United States exceeds domestic savings.  If you really want to affect the trade deficit then you must change the rate at which Americans save and invest.

Ron Paul also urges free trade.  This should include abandoning embargo policies which simply give foreign companies an unfair competitive edge over American companies.  You can't sell your wares in Cuba.  China can.  This has nothing to do with the value of the dollar.

Ben Bernanke has stated that the Fed doesn't control the value of the dollar.  This is, at best, a gross underestimate.  Sure, the value of the dollar depends on several factors, such as fiscal policy and Wall Street trading decisions, but monetary policy is the biggest factor.  Weaker dollars mean rising prices, and that affects you and me adversely. 


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 14, 2012, 01:59:18 PM
Ben Bernanke has stated that the Fed doesn't control the value of the dollar.  This is, at best, a gross underestimate.  Sure, the value of the dollar depends on several factors, such as fiscal policy and Wall Street trading decisions, but monetary policy is the biggest factor.  Weaker dollars mean rising prices, and that affects you and me adversely. 

Agreed fully.

Quote
The trade deficit is a natural consequence of the fact that investment in the United States exceeds domestic savings.  If you really want to affect the trade deficit then you must change the rate at which Americans save and invest.

How would we change the rate at which Americans save and invest?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: fezzyfestoon on March 14, 2012, 02:00:31 PM
How would we change the rate at which Americans save and invest?

Perhaps step one would be to stop massively promoting consumption.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Franzl on March 14, 2012, 02:05:37 PM
How would we change the rate at which Americans save and invest?

Perhaps step one would be to stop massively promoting consumption.

And stop giving such "easy" credit.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 14, 2012, 02:12:42 PM
How would we change the rate at which Americans save and invest?
Perhaps step one would be to stop massively promoting consumption.

You like repealing the mortgage interest tax deduction?

And stop giving such "easy" credit.

Such as? By raising mortgage rates?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Franzl on March 14, 2012, 02:16:33 PM
I was thinking more along the lines of how easily and recklessly a lot of people are given credit cards.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 14, 2012, 02:20:46 PM
How would we change the rate at which Americans save and invest?

Perhaps step one would be to stop massively promoting consumption.

Fair enough.  We have become a net importer of capital because Americans do not save enough to finance all the available investment opportunities in our economy.  Franzl and Fezzy are right about that.  Clearly, our government encourages this.  Bush, then Obama (both with the blessings of the Fed) have encouraged us to spend, rather than save.  With our leaders egging us on, you can't expect any serious change on this.

On the other hand, you could argue that the trade deficit is not a sign of economic distress, but of rising domestic demand and investment.  After all, the fact that we have become an importer of capital simply allows us to pay for imports over and above what we export.  I wasn't trying to get into a debate about whether we should or shouldn't encourage savings, but rather I was just saying that manipulating the currency (and imposing trade barriers, for that matter) will only make Americans worse off while leaving the trade deficit virtually unchanged.  When I took economics in school they taught us that the pressure normal market forces would adjust the trade deficits if left to their own devices.  (Yes, the books were all written by Republicans and Libertarians back then, but it made sense at the time.)

Personally, I like spending less than I earn.  At home we save.  My wife and I both work and we put away quite a bit every month.  I only buy cars outright, never financing them, which meant that when I was younger I always had a clunker.  I only bought a house when I had at least enough for a 20% downpayment and even now we pay an extra ten thousand each year over and above the mortgage, just to avoid interest as much as possible.  Also, I'd go into a panic if I didn't have at least a year's liquidity stashed away, but if every American lived by that motto would we be better off as a society?  I really don't know the answer to that question.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 14, 2012, 02:48:33 PM
I was thinking more along the lines of how easily and recklessly a lot of people are given credit cards.

Ah, yes. Credit cards have definitely contributed to America's consumption habit. In the past few years, this kind of credit has been on the decline. Many of the worst credit card abuses were curtailed in the CARD Act (http://www.consumerfinance.gov/credit-cards/credit-card-act/feb2011-factsheet/). The total amount of revolving credit outstanding (http://ycharts.com/indicators/total_revolving_credit_outstanding#series=type:indicator,id:total_revolving_credit_outstanding,calc:&zoom=10&startDate=&endDate=&format=real&recessions=false) has also fallen substantially after years of fast growth. Credit card debt was recently overtaken by student loan debt as consumers' largest debt problem. So I think we have made progress on this front since 2007.

Quote
I was just saying that manipulating the currency (and imposing trade barriers, for that matter) will only make Americans worse off while leaving the trade deficit virtually unchanged.

Really? Why do you think that?

In economics, I think textbooks try to simplify concepts for students so that what is being studied can be properly focused on. Usually, the free market ideas are the most beautiful and elegant, and you can't understand the effect of government intervention without first understanding how the market would work without government intervention, so it makes sense to teach it that way. It is true that currency markets, like all other markets, adjust to supply and demand, and normal market forces in a perfectly free market should in theory self-adjust. For better or worse that is not what we have.

I am still not fully decided trade deficit is inherently good or bad for the United States, although I've been thinking about this question for years. It does make me uneasy for foreigners' claims on US assets to increase year after year as we import their capital. Additionally, it means fewer jobs. Many of the so-called investment opportunities for which we import capital, are not really good investment opportunities (the entire US housing bubble, for one). On the other hand I understand that a more valuable dollar increases our purchasing power, and that the effect of this often falls most heavily upon the working class, and that is an important consideration for any Democrat.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 14, 2012, 08:57:56 PM
Beet, I sense three questions here.  I'll take it CARLHAYDEN style,

1.  The value of a good or service is whatever you think it is.  The value of a dollar is not.  If the value of a dollar decreases, then the number of dollars you pay for a good or service increases.  Since you only have a finite number of dollars, it follows that that the utility value of the weak dollar policy is necessarily negative.

2.  To lower the value of a dollar on the assumption that if dollars cost less, then anything priced in dollars, such as Lincoln Continentals or MacIntosh 3G systems, will sell in a greater volume on the open market will benefit, at most, the few people who own those companies.  As for the rest of the public, see item #1.

3.  Trade barriers create price floors and shortages of goods, or they create price ceilings and surpluses of labor, or both.  (Yes, I understand that Price Theory is presented in a way that assumes several conditions.  Sort of like in Thermodynamics classes, ideal gas laws must be mastered before we consider deviations from ideality, such as dipole-dipole interactions and hydrogen bonding and the like, but in the end, after you do all that work to include the virial coefficients, you find that unless you have more than three significant figures to work with--and you never do in a real laboratory situation--then the assumption of ideality for atmospheric gases, except water vapor, works well over the broad range of temperature and pressure that you're likely to encounter in the course of a year on the surface of the earth.  It seems to be the same with Price Theory.)

4.  We haven't even really decided whether the trade deficit is ultimately a bad thing.  If the world ends today, and I owe you a hundred billion dollars, then I have come out ahead due to my wise decisions.  (Yes, that is probably a quintessentially a Republican viewpoint, but it is one worth considering if we're going to have this discussion.)  On the other hand, if our children our left landless owing to the fact that we have mortgaged all our assets to live comfortably, then we have two possibilities:  (a) that the value of the souls we have sold have brought our progeny greater wisdom and ability to control the Earth's resources in a way that benefits them, and, hopefully, all mankind or (b) that the value of our souls was so insignificant that our mortgaging of them only prolonged the inevitable servitude of our progeny.  I guess there's the third possibility that (c) none of us has any soul to begin with.  Only Time can ultimately answer these questions.  As I said, I'm not entirely decided on the question of the trade deficit in particular.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 14, 2012, 10:32:35 PM
angus,

That structure does clarify things a bit. I have not much to say about #3, as I do not have a strong opinion on trade barriers; I think that in general, the assumption of ideality works well in some instances and not so well in others. My understanding is that some of the most highly developed ideal models of the free market have trouble explaining things like involuntarily unemployment. Society is generally too complicated to be explained by mathematics alone. Mathematics are relatively good at describing physical phenomenon, less so biological, still less so psychological and I think, least of all so social phenonena, which are at the very least an aggregate of psychological ones. That does not stop economists from trying, of course.

I will reflect on #4.

We are far apart on #1 and #2. On #1, I think you are missing a number of factors. Firstly, the value of a dollar to every individual is different. To Steve Jobs on October 3, 2011, the value of a dollar was nil. The dollar had nothing that he wanted, as it could not buy him an extension of life (at that point, he may well have traded his one extra day as a billionaire, in exchange for living 20 more years as a hobo). To most of us, the value of a dollar is equal the utility (to simplify) that we expect to get from it, which can be approximated as the inverse of the cost in dollars of the basket of goods that we want to consume, assuming that we are substituting wisely. It is different for every person, and it has more to do with the price level than the quantity of dollars out there, let alone the dollar exchange rate. I do concede that a lower dollar exchange rate can make you worse off; but my point is that you cannot make a 1-to-1 statement from a weak dollar policy to the dollar in your pocket. Many factors, including your own personal situation, your spending preferences, the price level, etc. come into play. Even less can you make the case that a weak dollar policy has a negative effect on your own personal utility, because your utility depends on many factors beyond even the value of the dollars you have, including your investment returns and interest income, your future wages, your employment outlook, more peripherally the condition of your family, friends and community, perhaps the availability of credit to you if you need it, the fiscal condition of your government, and the like.

To #2, I hardly even know how to respond. The first thing we point to is all the financial crises in the rest of the world that are the basis of our case. Whether one looks at Sweden, Argentina, Russia, Southeast Asia, the United Kingdom and France among others during the Great Depression, or indeed what is going on today in Greece and Spain and Germany and the like; It is clear that the main benefit of a weak currency is that it increases demand for labor and other kinds of investment that increase production in tradeable goods (as opposed to non income generating goods such as housing). It is much broader than the owners of Lincoln Continentals or MacIntosh 3G systems companies. With a strong labor market and rapidly rising wages, the public gets more and more flush every year, certainly compared to the opposite.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Gustaf on March 15, 2012, 03:34:21 AM
Angus, it should be pointed out that there are two effects going on when the currency weakens. One is that the price of American export goods fall abroad, leading to more exports. Secondly, the price of imported goods go up in the US, leading to less imports and more consumption of domestically produced goods.

Both effects lead to more domestic production. This helps keep up employment in the country. In this way, counter-intuitively as it may seem, I'd argue that currency devaluation is more fair - it spreads the cost of an economic downturn across society, mostly harming the upper echelons - those who go abroad on vacation or buy imported foreign goods.

Without currency devaluation a downturn will largely be shouldered by those who lose their jobs.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: opebo on March 15, 2012, 06:45:26 AM
Had the Germans been required to return to a simple, agrarian lifestyle, and been broken into their original several dozen small countries, they would have been much less trouble.

We could have allowed the technical germans like Dr. Stranglelove to emigrate to the US as many of them did anyway.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: angus on March 15, 2012, 10:40:44 AM
Beet and Gustaf,

You make excellent points.  You're probing the absolute limits of my understanding of these issues.  I had two economic courses in all my university years (macro and micro).  This is my limited understanding of the advantages and disadvantages of currency devaluation:

Advantages (most you have already pointed out): 

-exports become less expensive; more competitive to foreign buyers; consequence is that this provides a boost for domestic demand.

-more exports smay lead to an improvement in the current account deficit

-more exports and aggregate demand can lead to higher rates of economic growth.

Disadvantages (most I have already pointed out):

-inflation (imports more expensive; demand pull inflation; businesses have less incentive to cut costs because they can rely on the devaluation to improve competitiveness)

-purchasing power of US persons abroad is diminished

-it may put off potential international investors (maybe it makes them less willing to hold government debt because it is effectively reducing the value of their holdings)


I'd only add that in my own situation, which is that of a white-collar working class American who saves for retirement, enjoys spending money in the Caribbean, Latin America, and East Asia, and invests a modest amount in the marketplace, the strong dollar works well.  Think about it:  My wife and I get paid in US Dollars, so a higher value means more pay.  We do our own laundry and dishes and we rarely eat in restaurants, so I don't have to pay for this type of labor so higher value doesn't hurt me.  My house is full of foreign-made trinkets.  I own a German car and a Japanese camera and several Chinese televisions and computers, etc., and have been generally satisfied with them and would buy them again, so having large dollars compared to Marks and Yen and Renminbi doesn't hurt me.  Sure, I'd buy a US camera if I tried one out and it worked well.  One of my guitars was hand-crafted in Pennsylvania, but I also have a Mexican guitar and a guitar made in Idonesia, and they sound pretty good as well.  Our piano is a Yamaha, but I'd consider a Boston or an Essex for my next purchase.

My point is that we benefit from a strong dollar.  Like I said, common folks like me usually do.  Steve Jobs may or may not benefit from a strong dollar, but he doesn't represent the average gringo. 


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: SUSAN CRUSHBONE on March 15, 2012, 11:06:39 AM
Had the Germans been required to return to a simple, agrarian lifestyle, and been broken into their original several dozen small countries, they would have been much less trouble.

We could have allowed the technical germans like Dr. Stranglelove to emigrate to the US as many of them did anyway.
You do realize you are essentially advocating genocide here, right?


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Franzl on March 15, 2012, 03:54:04 PM
Had the Germans been required to return to a simple, agrarian lifestyle, and been broken into their original several dozen small countries, they would have been much less trouble.

We could have allowed the technical germans like Dr. Stranglelove to emigrate to the US as many of them did anyway.
You do realize you are essentially advocating genocide here, right?

Opebo approves of genocide normally.


Title: Re: Germany wants to take control of the Greek budget ?!
Post by: Beet on March 15, 2012, 04:07:11 PM
Good points, angus.

One issue that hasn't been touched on so far is how monetary policy is conducted. Today, generally when the central bank purchases government bonds it does so from a small coterie of large banks and the monetary base is expanded through these banks' deposits at the Fed. The money goes first to the innermost sanctum of the monetary system; from there, it is available to be loaned from the large banks to others; it trickles out. Inside-out, or Trickle-out, monetary policy.

One could imagine, however, the government creating money and simply mailing a $100 check to every household in America. The money would find its way back into the banking system as deposits, and eventually a portion of it would be used to cover banks' required reserves, and find its way back to the Fed. You could describe this as a more Outside-in, or trickle-in, form of easing. Of course, strict rules would have to be in place to prevent such a policy from being abused. For example, only implementing it if there is widespread deleveraging throughout the economy, to maintain the monetarist goal of a fixed growth rate in the money supply.