Thursday late night, 18 May 2017, the Greek Parliament voted to accept another round of devastating troika (EC, IMF, ECB) conditions for an additional debt package of close to 5 billion euros. All of the 153 delegates of Alexis Tsipras’ Syriza-Anel coalition voted ‘en bloc’ for the suicide package, all 128 opposition members against. Nineteen didn’t show up. Perhaps they were too afraid to vote for the opposition. Just as a reminder, PM Tsipras, a socialist, is leading Syriza, Greece’s prominent left-wing party, that for reasons of majority decided to align with the extreme right-wing party ‘Anel’ which currently holds a mere 10 seats in Parliament.
- Firstly published: October 2016
The main aspect of these USA elections was not elections, but war according to the controversial Russian political scientist Alexander Dugin who has close ties with the Kremlin and the Russian military. For him, the recent attack of US coalition on Deir Ezzor Syrian government targets, backed by Russia and which helped ISIS to advance in the area, has led to reach a pro-war climax. Yet, the financial system of these two countries depends one another in such a way that going to war now makes it impossible for both US and Russia. But propaganda always motivates elections and boosts the army industry.
Of course Russia and the United States both caused the death of a lot of civilians in Syria and this war seems that it has no issue or outcome for the time being.
- 00h30 Rome Time: Italian Prime Minister Matteo Renzi has resigned after suffering a heavy defeat in a referendum over his plan to reform the constitution.In a late-night statement, he said he took responsibility for the outcome. He said the No camp must now make clear proposals.
— The Globe and Mail (@globeandmail) 4 décembre 2016
Italian referendum: Exit polls show that voters have overwhelmingly rejected constitutional reform proposals on which Prime Minister Matteo Renzi has staked his political future:
Italy, constitutional referendum, EMG exit poll:
— Europe Elects (@EuropeElects) 4 décembre 2016
Update: 19h*Austrian state broadcaster: exit polls suggest win for Van der Bellen ( Green Party-The Guardian):
- The Guardian reports that early exit polls indicate Austria has voted in Green-backed candidate Alexander Van der Bellen as its next president, handing a painful defeat to rightwing populist Norbert Hofer.The defeat of far-right candidate Norbert Hofer to the liberal, left-of-centre Alexander Van der Bellen in Austria’s presidential electionsmarks a setback for the Eurosceptic, anti-establishment cause in Europe.
With Brexit and the U.S. presidential election, 2016 has already contributed its share of major political upsets. Yet another upset may be in the making. The Italian referendum taking place today in Italy on constitutional reform and the second chance of Norbert Hofer of the anti-immigration Freedom Party (FPO) to become the first far-right president in Austria could both possibly have disastrous consequences for Europe and the world.
Very often bad things happen to good economies.
Take as an example Finland. Its schools are among the best in the world, its government is among the least corrupt, and, for rich countries, its public debt is among the lowest. But despite the fact that the fundamentals of its economy are strong, its economy is not, in fact, strong.
The slightly longer version is Finland has had some bad luck that the euro has turned into a bad recession, or at least a worse one that it had to be. It started when Apple made Nokia go from being synonymous with smartphones to being synonymous with old smartphones. As Finland found out, it isn’t easy to replace a company that, at its peak, made up 4 percent of your economy. Obsolescence came for the timber companies next. There was nothing they could do to make people need as much paper, which until now had been a major export, in a post-paper world. And, on top of that, Finland has felt the effects of Russia, one of its biggest trading partners, staggering under the weight of low oil prices and Western sanctions. Put it all together, and Finland was always going to have a tough time. But it’s been tougher than it needed to be, since Finland hasn’t been able to do what a country would normally do in this situation: devalue its currency. That’s because Finland doesn’t have a currency to devalue. It has the euro.
. Well, it wouldn’t. What it would do, though, is make the rest of Finland’s economy competitive enough that things that aren’t strengths today would become ones tomorrow. It would also keep inflation from falling too much—it’s actually negative now—which, in turn, would make debts a little easier to pay back and keep households spending and businesses investing a little more. Think about it like this. Anytime a shock hits, whether that’s banks failing or an industry dying, the economy needs to cut costs to regain competitiveness. There are only two ways to do that: cut the value of the currency so wages aren’t worth as much, or cut wages themselves. Now, this might sound like a distinction without a difference, but it’s not. It’s a lot easier to cut one price (the exchange rate) than it is to cut millions of prices (people’s wages). And it’s a lot less painful, too. You don’t have to fire anyone to devalue the currency, but you do to make people take pay cuts.
Here’s where things get tricky, though. How much should we blame the euro for Finland’s problems, and how much we should blame, well, the problems themselves. After all, it’s not like the common currency had anything to do with the iPhone turning Nokia’s flip phones into little more than cultural artifacts. Although, on the other hand, it has had something to do with how long it’s taken Finland to adjust to this new reality. There’s no easy answer here. But what we can do, as Paul Krugman points out, is compare how Finland has done to a similar country that doesn’t use the euro—a country like Sweden. And that, as you can see below, is a pretty ugly picture. Finland and Sweden grew almost identical amounts between 1989 and 2008, before diverging 20 percent since then. The fairest conclusion is that, given that so much has befallen it, Finland would have fallen behind even if it’d kept its old currency, the markka, but that it’s fallen even more than that because the euro has taken away its ability to do anything about everything that has happened to it. All it can do is try to cut costs ever more religiously. But facts are no match for faith, and Finland has plenty of that in its economic strategy. Finnish finance minister Alexander Stubb told the New York Times’ Neil Irwin that “devaluation is a little like doping in sports” in that “it gives you a short-term boost, but in the long run, it’s not beneficial.” The problem is that although this sounds like a cost-benefit analysis, it’s more a moral one. It’s really pooh-poohing devaluation as the easy way out. But why shouldn’t we want that? The two best things about the easy way out are that it’s easy and is, in fact, a way out. Finland could use one of those given that its economy is still 5 percent smaller than it was in 2008.
The only way the euro could possibly be worth it is if it helped Finland more before the crash than it’s hurt Finland since. That’s a hard case to make, though, considering that Sweden did just as well without the euro as Finland did with it during that time.