The entire purpose of this blog is to ask you to think outside the box. It therefore cuts across the lines of dogma of any group, and is formed purely by my own independent thought. As I have frequently stated, if anybody agrees with every point I make, something is wrong.
This is going to annoy both left on Greece and right on banks, and my own party on the SNP and Labour. Here goes.
The citizens of the United Kingdom gave 45,000 pounds each, every man woman and child of them, direct to the bankers in bailouts. We will be paying off that money in taxes – with vast sums in interest to the same bankers, from whom we borrowed virtual money they did not have, to give to them as real money – for generations to come. Quantitive easing gives yet more money to the bankers, cash in place of risky bonds they wish to dump.
When you add it all together including interest, every man, woman and child in the UK will pay over 100,000 pounds each to the bankers, to bail out the bankers from the mess their own extreme greed had created. Indeed it is possible to argue rationally that the payment will be infinite, as the debt incurred will never be repaid but continually rolled over, and interest payments continue.
We did not have to do this. We could have let the bad banks go bust, started new ones, and boosted the economy by spending just 20% of the money we have given the banks on crucially needed public infrastructure works – railways, renewable energy, housing, insulation, hospitals, schools etc. But Gordon Brown and New Labour decided just to give money to the bankers instead.
In Greece, the people have actually given much less to the bankers for bailout than people in the UK. It is important to acknowledge that the causes of the Greek financial collapse are different. Greece was rather a recipient of bad lending, a country which received loans it could not possibly afford. Due to corrupt networks of elite collusion embracing both government and private sector, much of this money was simply siphoned out of the country into overseas accounts in London and Cyprus. The British people are suffering from the banking collapse through being forced to bail out the bankers. Greece is more in the position of somebody in a huge house who could not afford the mortgage – except for the vital distinction that all the people in Greece were paying the mortgage, but the large majority living in sheds behind the mansion.
I welcome Syriza’s victory as an indication that people are not content just to accept the narrative given them by the mainstream media and the parties in the pocket of corporations. I hope that they negotiate hard and force the banks to take a huge haircut on Greek sovereign debt. I acknowledge their commitment to social justice. But I do hope they will be realistic with both themselves and their people on the amount of blood, sweat and tears that is going to need to go in to building a productive Greek economy. An example of Keynesian stimulus is much needed by the rest of Europe.
Gordon Brown’s bank bailout was probably the biggest single gift any politician has ever given his corporate masters in the entire history of the world. It is worth reminding ourselves just how very right wing the Red Tories are. Not to mention the fact their front bench remains littered with war criminals. I therefore have grave reservations about Nicola Sturgeon’s weekend interview indication that the People of Scotland want a Labour Government with SNP support. I don’t. I am not going to elect somebody to represent me as chief bag carrier to a war criminal.
The SNP leadership remain infected by managerialism. It is easy to convince yourself you are doing good things while not changing anything fundamental, and at the same time building a very well paid career and a personal powerbase. I don’t want devo-max, I don’t want more powers, I don’t want something “as close to federalism as possible”. I want freedom for my country. I want independence. I want to live in a country which does not illegally invade other countries, collude in torture, carry out mass surveillance of its citizens, or possess nuclear weapons. The idea of running the Union a little bit better, making it a teeny bit more humane and competent, does not interest me. Nor does dulling the edge of austerity, when it is going to behead us anyway.
Besides which I am absolutely convinced the Tories will win the election, which will make all this jostling for position look rather foolish.
Robert Crawford, thanks. I always have what matters anyway.
“Henry Ford once famously said that if the people only knew and understood the banking system there would be revolution tomorrow morning.”
lol, not that famously obviously.
@RobG: Indeed! Here’s a quote from Jefferson on the banksters:
And here’s another:
Just one more, if you’ll allow:
Mr Goss
If debt and the creation of debt (by whomsoever – states or private banks) is all bad, the logical consequence of that must surely be:
– for govts, not to spend more (eg on social benefits, pensions, its own running, infrastructure etc, etc) than it receives in various receipts (mainly taxes)
– for individuals, not to borrow in order to buy things (including housing)but to pay for them from own income.
Would you agree with those two propositions and if not, why not and what course of action would you recommend to govts and individuals so that they may continue to benefit from “lifestyles” not finaciable through thier own “receipts”?
“The bailouts are analogous to allowing a thief to repay what they’ve stolen you from future anticipated proceeds of stealing from you again.”
Spot on, good post. Tony M
26 Jan, 2015 – 8:05 pm
Glen.
You have been voting for politicians who are putting you and me in greater debt year on year.
It is money that makes the world go round, and it is money that is required to pay the debts. Therefore, it is someone who can make money, big money, that is required to put the country back on it’s financial feet.
In the same locality there is a young woman on her own and has two shops. One local, one some distance away. She employs 4 or 5 people. Progressive, go ahead type. Now I would say she is more suitable for the job than the one man band.
I gave you a clue as to my age before you were led up the garden path by A. N. Other.
Now, Labour under Harold Wilson put me out of two businesses in the early seventies with a little help from the press. Do you see where Labour has us now? Labour are incompetent in my experience and I have never voted for them, since I got the vote at 21.
I don’t think a barber and an Occupational Therapist have the expertise to be running the country. Quite frankly, I think the average housewife could do a better job. She has to balance the books all the time and is not so bloody ego orientated.
The debt is so enormous, that people don’t seem to realise how serious the situation is. America’s is worse. The debt is going up like a rocket every month. No private business could survive this debt, the banks would have bankrupted them long ago.
These are the people who are now telling you again that they are the right Party to put it all right for you and me if we would only give them the chance.
Any ideas what kind of super person is going to put this mess right in the next 50 years. You could not get a loan/mortgage for that kind of debt over 50 years. I bet in the next 5 years you will be saying, ” how come we owe more now than when Robert Crawford rubbished the choice of a barber and an Occupational Therapist, and other similar types to run the country.
I hope I am wrong. Only time will tell. However, past form has got us to this rising, and continuing to rise level of debt.
What is all the borrowing paying for, and when will the borrowing stop? None of these billions are coming my way. Are you getting any of them? Is anyone getting any of these billions?
Where are they getting these billions from?
Scotland’s oil and gas pulled them out financial trouble the last time. What or who is going to save them this time?
Are you going to vote for them? I heard a wise crack the other day, ” if voting changed anything it would have been banned long ago”.
No harm to wee Johnny the barber. I just don’t think he is qualified for the job, and neither is the Occupational Therapist.
I will not be voting for them!.
Fascinating:
“Debt Cancellation in Mesopotamia and Egypt from 3000 to 1000 BC”
http://www.globalresearch.ca/debt-cancellation-in-mesopotamia-and-egypt-from-3000-to-1000-bc
“The point is, though, that odious debt is only a theory in international law whereas the concept of duress is actually part of contract law.”
In order for you to have any point at all, other than pedantic pedantry, the concept of duress in contract law would have to have no standing in terms of whatever contracts the Greeks signed.
Is that what you’re arguing?
Because, unless you’re arguing that and are shown to be correct, this is just vacuous piffle, isn’t it.
“Let’s be clear, because your post as formulated “in international law..” might mislead the unwary reader: odious debt is nothing more than a theory in the field of international law, it is not part of international law. Some jurists support the idea, others dispute it.”
I mean, if the Greeks can pursue their grievances through normal contract law then what’s the concrete distinction you’re trying to make.
And indeed, why would anyone, your contrary “jurists” for example, disagree with the concept of “odious” contracts, when the same very concept is fundamental to contract law anyway.
CanSpeccy and Jemand
no and no.
The banks should first have been held to account as to how bankers were paid at all from a black hole of debt. No rescue until they admitted to their magician’s trick. Interest. Using customers’ capital to line their pockets and replacing it with nano-calculated IOU folly.
Immigration is not a ponzi scheme. God made sheilas for breeding. If you feed them hormones or block their ova or stop sperm or abort foetus, or have sex with things not intended for the purpose, you get a hole in society that has to be filled by people who want families. Call life a ponzi scheme if you like but don’t blame foreigners for a home-grown problem.
Get lives the pair of you. Who are you trying to impress?
Guess what Glen.
A group of intensive care surgeons went along to a Formula 1 racing team ( I think Maclaren) and asked if they could help with handling their patients from one stage to the next in a quick and safe way to save lives. Similar to the fast and safe way they manage their racing team from stage to stage.
Who would have thought of that?
A barber maybe? Or, even an Occupational Therapist? Aye right!
Rock on Tommy!
Habbabkuk,
Which bit of the post by Craig Murray at 12:18 26/1/15, reprinted below, is causing difficulty?
“Abe Rene
No, you borrowed it to give it. Nobody asked you if you wanted to. You will be paying it off in tax (including VAT) the rest of your life.”
Or is the suggestion being made that the money for the bail outs and continuing bonuses either did not come from the taxpayers or was from spare cash floating about in the current account rather than from Government borrowing on behalf of the taxpayet?
The government, and all its affiliated offices are no more than a organised crime syndicate.
The police, the judicial system, and of course the army, which is just a force to protect the rich mans interest at home and abroad, are all geared up to protect the states interests,as well, and not the peoples.
The banks are part of the “rich mans syndicate” in the UK, and must be saved at all costs, the price can then be passed on to the idiots in the street, who are so besotted with having the newest iPhone, and other shit, that they can’t see the woods for the trees.
Julius, Caeser knew this all too well, using the “Bread and Circus” routine, to fool the mugs in the colosseum.
The whole lousy system is rotting to the core, and has been for decades.
The Ministry of Truth is very much alive and well.
Don’t forget Solon’s Seisachtheia [shaking off of debts]:
Herbie
Contract law? Who is more aggrieved, the EU for supposing that Greece would play by the rules of the club, or Greece for being punished? Greece is not a suitable country to follow Teutonic fiscal common-sense. Nor is Turkey.
They have to be run by people of the same mentality as themselves, not by people who understand the concept of Protestant mutual assistance and service to the general good.
Greece rejected Ottoman rule. Why would it embrace EU rule? A do-gooding socialist government in Athens is a disaster waiting to happen and can very quickly be replaced by generals of the ilk of Sisi.
Germany cannot afford to be de-stabilised by either Mediterranean or British ὕβρις
The Greeks have very ugly memories of the rule of the Colonels.
Craig, I’m afraid you’re hopelessly confused about the banking crisis – not so much thinking outside the box as not thinking at all.
1. The government didn’t “just give the bankers” billions which future generations will have to pay for. It provided interest-bearing loans and loan guarantees and acquired shares in the banks (which could be sold later). In return, the banks had to agree to various conditions, including firing their CEOs. Shareholders in the worst managed banks lost all or most of their investment.
All the largest western countries took similar action because banks in all these countries were overwhelmed by the same liquidity/solvency crisis, like a tsunami.
2. You fail to understand that banks in capitalist systems don’t want government bailouts, which mark them out as failures, undermining confidence and driving away customers and investors.
In 2008, HSBC refused to take any bailout money and threatened to take the Labour government to court if it insisted otherwise. Barclays also rejected government money (but obtained funds from wealthy Arabs).
3. The size of thebailout isn’t important, if you think it was a good idea to prevent the stricken banks from collapsing (with all the job losses and economic chaos which would have ensued in real life).
The important thing is: what was the ultimate result for the taxpayer? From this point of view, the Labour government designed the UK bailout very poorly, compared with the US. As a result, UK taxpayers appear to have lost an estimated $14 billion, while US taxpayers appear to have made an estimated profit of $8-10 billion. (If it’s any consolation, German taxpayers may have lost $55 billion).
Here’s an article which explains these points.
http://cpd.berkeley.edu/wp-content/uploads/2014/09/Culpepper-Paper-for-CPC.pdf
(ignore all the political science guff – just look at the narrative parts eg pages 31-34 for HSBC, Barclays etc. and the table on page 43 for the profit/loss to taxpayers)
Greece may well default on some of its debts, but there’s no way the ECB or the IMF or even the World bank, will lose monies, these corrupt organisations just add the debt onto some unsuspecting third world countries debt.
The handling of EU loans to countries in the EU is as corrupt as the US Fed.
Funny how neither Greece nor Spain or Ireland for the that matter of fact, were in debt until they joined the EU.
@ Tony M.
he answer is the shares in banks are worthless
That kind of remark is simply childish. The shares have a cash value right now, from which the loss or gain by the government can be calculated. It is, in fact, currently, in the order of 40 billion.
It is worth noting, also, that the people bailed out by the government were not merely the banks but the bank depositors. Yes, all those greedy people who deposited with Northern Rock because Northern Rock paid a higher rate of interest than other banks. When these people deposited their cash, it ceased to be theirs, it became the property of the bank. The bank then pissed it away, so legally and morally the losers were the depositors. In fact, the bailouts mainly amount to the middle-class and wealthy who pay most of the taxes, bailing out one another.
Not so much to get indignant about, though, when looked at that way.
Here’s something about ownership of bank deposits, just to make it clear who was bailed out when the banks went bust.
“When a customer deposits money into a bank, the bank essentially issues a promise to have those funds available when the customer returns to withdraw the deposited amount. When the same customer withdraws funds from their account (whether checking or savings) the customer assumes that the bank has enough funds to cover their withdrawal; including the presumption that their monies are separate from the bank’s assets.
“Now, those funds are up for grabs by the bank at their discretion without explanation to the customer – nor is the bank obligated to recoup the customer should they “lose” those funds due to bad loans, bankruptcy or stock market loss.
Mr BellyHeave defecates:
“Mr Goss
If debt and the creation of debt (by whomsoever – states or private banks) is all bad, the logical consequence of that must surely be:
– for govts, not to spend more (eg on social benefits, pensions, its own running, infrastructure etc, etc) than it receives in various receipts (mainly taxes)”
The government subsidy of Tax Credits allows working people to reduce their earnings to nearly zero and float on the subsidy.
These bastard Tories with their out of touch Lib-Dems partners have cut back the emergency subsistence of un-employed people to the point of starvation, while flooding the employed with benefits – all on an ideological Victorian dogma of the value of work in society.
That is why there will definitely not be a Tory victory in May. The Tories simply don’t understand the lives of the majority of the people. Work is not good for you in its own right. It is good for you if it stabilises your life. Scrapping job security is not compensated for by Tax credits.
I suppose their speech-writers just look up slogans from Victorian sermons to be used as sound-bites. Tories have absolutely no comprehension about ordinary people’s lives and they only got in on the back of traitor Clegg.
Fracking – not going to happen. HS2 – not going to happen. Trident – not going to happen. Runway 3 at heathrow – not going to happen. Tories are completely incompetent. None of these things benefit ordinary people. Even UKIP makes more sense!
Conversation with Paul Craig Roberts: The Greek crisis.
Herbie
““The point is, though, that odious debt is only a theory in international law whereas the concept of duress is actually part of contract law.”
In order for you to have any point at all, other than pedantic pedantry, the concept of duress in contract law would have to have no standing in terms of whatever contracts the Greeks signed.
Is that what you’re arguing?”
__________________
As always, Herbie, you have to have the last word. I suspect you were once in the teaching profession or an academic. But no matter!
To your question : yes, that’s what I believe.
You might as well argue that of you, Herbie, were desperately in need of a loan for something and to this end agreed to take a loan from your bank, you could subsequently refuse to repay said that loan by arguing that you took it out under duress (the personal circumstances which “forced” you to take it being the “duress”.
But whatever. Just tell me to which international court you would advise the Greeks to go to seek relief.
Dave Hansell
“Or is the suggestion being made that the money for the bail outs and continuing bonuses either did not come from the taxpayers or was from spare cash floating about in the current account rather than from Government borrowing on behalf of the taxpayet?”
_______________
No by me, it isn’t. Of course it comes from the taxpayer via the govt and the taxpayer is now, via the govt, the creditor for various loans and the holder of substantial equity in the banks that were bailed out (see posts from a couple of commenters, above).
Humbug
Nobody forces you into debt if you cut your suit according to your cloth. But if the Thatcherite bank swindlers cut the cloth of your pocket, not literally like in Pakistan, you will definitley be forced to borrow from them from the rest of your life.
You scurrilous, horrible little troll. You always let the war-criminals, Zionists and corporate swindlers off the hook.
horrible little school ma’am.
Republicofscotland
“Funny how neither Greece nor Spain or Ireland for the that matter of fact, were in debt until they joined the EU.”
__________________
Funny how Greece wasn’t in debt (or only moderately so) until it elected a PASOK govt – which made many of the same promises as Mr Tsipras has been making….and acted on them.
1981 refers.
Andrew
Excellent post and link, through which you reinforce those who object to Craig’s idea of “gifts to the bankers”.
I believe the intention of this post of Craig’s is less to get people to think outside the box than to get them to vent yet again. In that, Craig has succeeded brilliantly – yet again.
This concept of odious debt is worth further consideration. It is worth thinking about the Hammersmith and Fulham swap and ultra vires arguments as well. Try reading FIASCO (Fixed Income Annual Shotgun Company Outing) by Frank Partnoy to get a feeling of what odious debt might smell like.
Guano
“You scurrilous, horrible little troll. You always let the war-criminals, Zionists and corporate swindlers off the hook.”
_________________
Flattery is always agreeable but I fear you over-estimate my powers.
Please attend some anger management classes before this evil Tory govt. cuts off their funding.
Troglodytae non vescendi sunt.
Habba at 11:03: Just tell me to which international court you would advise the Greeks to go to seek relief.
………..
This is a good point. At State level there are some judicial forums for certain types of disputes although enforcement is another issue again and of course not everyone signs up to each forum.
To date it hasn’t really been in the interests of states to set up a forum to review and adjudicate on the enforceability of state debt (or if there is I don’t know about it), but anyway if the issue (state default in the billions) is a biggie it will eventually come down to the level of the schoolyard, i.e. power, spin, negotiations, threats, bluff and alliances.
If a state says its own courts are sovereign and declares its debt unlawful then it is really a question of can the creditor enforce, or persuade a state or international state agency or set of agencies to enforce on its behalf. That can be through coercion or seizure of overseas assets or even a coup.
If the creditor can’t enforce then it is for the debtor country to do its best to re-establish itself in difficult circumstances and of course world bankers have memories, but clearly countries to re-establish.
The WSJ had an editorial in about 2006 which asked how would the US ever repay its debt and concluded that it wasn’t a big deal as when the time came, when the US was no longer the currency of last resort, then provided the debt was to repaid in dollars it could let print them and let inflation do its magic work (though I just don’t get deflation I have to admit). So only borrow in a currency which you print.
Interesting times.