Etikettenschwindel Euro-Krise [2011]

“Seit Anfang 2010 hat sich die Finanzkrise zur (Staats-)Schuldenkrise gewandelt. Niemand sollte sich von der gängigen Rhetorik täuschen lassen: Die Defizite und öffentlichen Schulden im Euroraum sind nämlich erst infolge der diversen Bankenrettungsaktionen und Konjunkturprogramme dramatisch gestiegen. Bis zum Ausbruch der Weltfinanzkrise hatten Länder wie Portugal, Irland, Griechenland und Spanien (PIGS), die heutigen Sorgenkinder, keine Finanzprobleme, im Gegenteil: Spanien und Irland verzeichneten gar Budgetüberschüsse. Erst in der Krise erfolgte die Kehrtwende: Der ganz große Krach wurde in Europa (wie in den USA) nur durch eine extreme Ausweitung des öffentlichen Kredits verhindert. Kaum waren die Banken und Finanzkonzerne gerettet, drohten Staatspleiten – kurioserweise vorläufig nicht in den USA oder in Japan, sondern in den vergleichsweise viel geringer verschuldeten Ländern der Eurozone. […]

Mit oder ohne Rettungsschirm, die PIGS-Länder sparen auf Teufel komm raus und treiben damit ihre Volkswirtschaften immer tiefer in die Rezession. Wenn ein Land mehr als 30 Prozent seiner laufenden Steuereinnahmen für den Staatsschuldendienst (Zinsen und Tilgung) ausgeben muss, wird es gefährlich; jenseits dieser Schwelle kommt es aus der Schuldenfalle bei steigenden Zinsen nicht mehr heraus. Im Fall Griechenlands beträgt diese Quote bereits mehr als 53 Prozent, die Iren kostet der Schuldendienst fast 37 Prozent ihrer laufenden Steuereinnahmen. Spanien steht mit einer Quote von knapp 25 Prozent besser da, und die Portugiesen können mit Recht darauf verweisen, dass sie der Schuldendienst nur 15,9 Prozent der laufenden Steuereinnahmen kostet. Italien und Frankreich sind diesbezüglich in einer weit prekäreren Lage.”

The Greek Rorschach test

“In other words, though Greece may be diminished, its catastrophe has offered the rest of the currency bloc a frightening example of what can happen when governments skirt the rules. If sacrificing Greece is the price for preserving the euro, so be it. […]

Ultimately, the debate comes down to one’s definition of ‘solidarity.’

Most Germans, for example, are convinced they showed Greece the utmost solidarity by providing billions in low-interest loans. While forgiving Greece’s debt might put the country on more solid financial footing, it would open the door to ‘moral hazard,’ the rewarding of bad behavior.

What that reasoning ignores is that Germany was the biggest winner of Europe’s bailout policies. No country has benefited more than Germany from the introduction of the euro, which has been a boon to its industry, fueling exports across the region. So if ‘saving’ Greece was really about preserving the euro, Germany was primarily acting in its own interest.

It’s easy to see why: The loans provided to Greece by the European rescue funds have put little German treasure at risk. In fact, so far they’ve generated a tidy profit.

Europe, to quote a Teutonic saying, has left Greece with too much to die and too little to live. […]

Instead of giving Greece that breathing room, Europe, at Berlin’s insistence, only agreed to give Athens more time to pay back its rescue loans, effectively delaying the day of reckoning.”

Lessons for the Eurozone from the Greek debt crisis [Charts]

“Mr. Centeno’s claim that ‘we have all learned our lessons’ from the Greek crisis is mealy-mouthed. The Eurozone’s leadership doesn’t seem to have learned anything at all. The Troika’s disastrous handling of the Greek crisis has driven Greece into the worst peacetime depression experienced by any advanced economy in recorded history. […]

But even if Greece manages to meet its targets, there is nothing ‘normal’ about forty-two years of sustained fiscal austerity. Nor does having to maintain such a draconian regime in any way constitute ‘regaining control’. […]

French and German banks were effectively bailed out by their own taxpayers. […]

Bank bailouts are unpopular. It was politically more convenient to blame ‘profligate Greeks’ for the bailout than to admit that French and German banks had lent foolishly, still less that bank regulators had been asleep at the wheel. Even today, the tone of Mr. Centeno’s comments places all responsibility for ensuring there are no further bailouts firmly on Greece. […]

The Eurozone has also failed to take on board the need for active management of balance of payments in a currency union where fiscal transfers are limited. […] Countries like Germany and the Netherlands can run persistently large current account surpluses without sanction.

Running a persistent current account surplus in a currency union is beggar-my neighbour policy. The Eurozone is not as closed as it was prior to the crisis, so the whole bloc is now running a current account surplus, mostly at the expense of the US. But the US is becoming increasingly intolerant of being forced into the role of consumer of last resort. Beggar-my-Atlantic-neighbour is no more sustainable than beggar-my-Aegean-neighbour.”

Greece’s “bailout” was a disaster for Greece [Charts]

“Had Greece been a country with its own currency, such as the Czech Republic or New Zealand, the central bank could have plugged the funding gap and prevented an abrupt collapse in spending. Membership in the euro area removed that option. The government and the banks owed debt in a currency the Bank of Greece could not print, and the European Central Bank was not keen on helping.

The textbook response would have been for the government to default on its debt and get a loan from the International Monetary Fund to help smooth out the adjustment. The amount of money required to buy time after a restructuring would not have been large compared with the nearly €300 billion that ended up being lent.

That option was blocked, however, by a coalition of Greece’s ‘European partners’ and the U.S. They were still traumatized by the bankruptcy of Lehman Brothers and had come to believe that its default had made the financial crisis far worse than it otherwise would have been. The result was a firm commitment to avoid any reduction in what the Greek government owed.

Their concern was not about what a default would do to Greece, but about what it would do to them. […]

There was no political will in 2010 to spend hundreds of billions of euros to bail out Dutch, French, and German banks. To Greece’s eternal misfortune, however, there was enough ‘solidarity’ to launder that Northern European bank bailout through the Greek government.”

The Greece bailout’s legacy of immiseration

“This was a bailout? The word reeks of indulgence and implied disapproval. As it was often said, ‘The Greeks had their party and now they must pay.’ Yes, there was a party—for oligarchs with ships and London homes and Swiss bank accounts, for the military, for engineering and construction and armaments companies from Germany and France and the United States. And yes, there was a bailout. It came from Europe’s taxpayers, and went to the troubled banks of France and Germany. Greece was merely the pass-through, and the Greeks who paid dearly with their livelihoods were just the patsies in the deal. […]

So Greece, which is to say its creditors—especially French and German banks—received the largest loan in IMF history (relative to its ownership share). And that 289-billion-euro loan came largely from U.S. taxpayers. […]

But the damage done extends far beyond Greece. The cynicism and brutality of what happened there is for everyone to see. The fact that Europe imposed a policy of privation on one of its weakest members—not for its own sake, and not with any expectation of economic success, but to intimidate the Italians and the French, as the German Finance Minister Wolfgang Schäuble conceded to the Greek Finance Minister Yanis Varoufakis privately in 2015—was not lost on British voters who chose Brexit in 2016.”

Heiner Flassbeck: Eine deutsche Falle für Italien

“Ja, es muss jemand einen Kredit aufnehmen und mehr Geld für Güter und Dienste ausgeben, als er selbst eingenommen hat. Mit anderen Worten, jemand muss neue Schulden machen. Denn wenn alle nur so viel ausgeben, wie sie einnehmen, bleibt die Wirtschaft genau stehen. Geben bestimmte Gruppen sogar weniger aus als sie einnehmen, das sind die, die wir üblicherweise Sparer nennen, ohne dass andere entsprechend entsparen oder sich verschulden, bricht die Wirtschaft weiter ein. […]

Man kann darauf bauen, wie das Deutschland im Zuge seiner ‘Strukturreformen’ zu Anfang der 2000er Jahre getan hat, dass andere Schulden machen, die einem selbst zugute kommen. Das kann gelingen, wenn man selbst den Gürtel enger schnallt und so billig wird, dass die Menschen im Ausland vermehrt die eigenen Güter kaufen und dafür Kredite aufnehmen.

Diesen Weg wäre Italien als exportstarke Nation in den vergangenen Jahren gerne auch gegangen, doch dieser Weg ist für Mitglieder der Eurozone weitgehend verschlossen. Er ist verschlossen von der Nation, die sich mit Hilfe ihres Lohndumpings auf den globalen Märkten der Welt dick und fett breit gemacht hat und den höchsten Leistungsbilanzüberschuss der Welt aufweist, nämlich Deutschland.”

EU’s debt deal is “kiss of death” for Greece

“Arguments for privatization aside, the deadly combination of higher debt and declining GDP had most economists convinced quite early on that austerity was killing Greece’s economy, and that a debt write-off would be at some point absolutely necessary for medium- and long-term recovery. However, Germany and its northern European allies had diametrically opposed this idea, insisting on even stronger doses of austerity, while balking at the prospect of a debt write-off.

At the same time, the idea of Greece exiting the euro was also an anathema to Germany and the eurocrats in Brussels. Keeping Greece in the Eurozone—even while its economy and society were going to bleed to death as a result of harsh austerity measures—was deemed absolutely imperative for the very survival of the euro, and for ensuring that all previous debts to European banks were going to be repaid. […]

In contrast to Tsipras’s outrageous claim that the debt deal represents a ‘historic’ agreement, in that it allows Greece to become a ‘normal country’ once again, the measures agreed on to make Greece’s debt sustainable will doom the country into becoming a permanent semi-peripheral debt colony of the EU. The deal simply pushes the debt into the very distant future, and locks society into a state of perpetual austerity by requiring that the government run exceedingly large primary budget surpluses. The deal is not a cause of celebration for Greece but, rather, a kiss of death. […]

At this point, with full budget surpluses running in the range of 5.3 percent (until 2022) and even 4 percent (from 2023-2060), ‘severe’ is not the right word to describe the level of austerity that will need to be enforced on the Greek population. A more apt term is ‘brutal’ austerity […]”