PIGS: Portugal-Italy-Greece-Spain; Euro Economic Collapse?

[amicus]

http://news.google.com/news?sourcei...=news_group&ct=title&resnum=4&ved=0CBkQsQQwAw

PIGS is a horrible acronym.

But this is how the financial markets refer to the troubled and heavily-indebted countries of Europe - Portugal, Ireland, Greece and Spain.

(Some analysts use PIIGS to include Italy - Europe's longstanding biggest debtor.)

Greece has dominated the concerns of investors since late last year, when concerns over whether it will be able to pay off the 300bn euros ($419bn; £259bn) in government debt it currently owes.

The euro has been battered over the past month as some even started to fear the break-up of the eurozone.

http://www.socialistworker.co.uk/art.php?id=17251

http://www.socialistparty.org.uk/articles/8677

http://www.sanbrunobeacon.com/h/201...ial-condition-of-spain-greece-portugal-c.html

http://www.feedcry.com/archive/aid/..._campaign=Feed:+fulltext/Bloomberg+(Bloomberg)

http://www.guardian.co.uk/business/feedarticle/8939424

"Half the Greeks who are in the private sector work to support the other half, who are civil servants(government workers)," said Kostas Giannoulakis, 45, who runs a lamp shop in downtown Athens. "These (deficit-cutting) measures are necessary."

(Bolded portion mine.)

Oggbashan, Liar, Handley Page & CharleyH, the ones who have indicated they live in Europe that I remember offhand, seem content with their National Healthcare plans, (socialized medicine), heavy Union presence, high taxes and high unemployment. Call this a Social Democracy if you wish...I see it in the form of a title to a book, "The Road to Serfdom".

Nonetheless, the outbreak of violence in Greece, a possible insurrection and overthrow of the government, is being bandied about the news of recent.

For the gratification of Left Leaning Litsters, I have included two socialist references which, not surprising, blame Capitalism for the possible collapse ol Portugal, Ireland, Greece and Spain.

Some are predicting a break-up of Euro settling out in the Russian Republic style after the internal collapse of the Soviet Union; others see a Communist China version of controlled Capitalism and no human rights.

Still others see the collapse of EURO as inevitable and are concerned that the US and the rest of the world may be dragged into a major depression.

Curious, eh?



Amicus

 

[ishtat]

Oggbashan, Liar, Handley Page & CharleyH, the ones who have indicated they live in Europe that I remember offhand

Amicus

Only Charley H of that group lives in the Eurozone as opposed to th EU. It will be interesting to see whether UK and Sweden as EU members(but not Euro currency) back the German led, Eurozone bailout.

One interesting point is that Germany although with its own problems is now in a position to totally dictate terms to the rest of the EU.

I anticipate that Greece will agree to all Germany's demands and then renege on the deal, they usually do.

One other point . The travails of the Euro are good for USA as the dollar is some 25% more competitive than it was 18months ago. I suppose you'd Give Obama the credit for that... wouldn't you?

 

[amicus]

No, I would not as our own economy is approaching the level of Greece because of massive spending and debt. I would surmise that the Euro has simply fallen faster than the $ and the relationship is comparative, not real.

I do appreciate your input, however and urge you to contribute more towards an understanding of why these countries are under such financial stress.

So many on this forum express an affection for the Euro lifestyle, economic and political methods and I wonder, as is stated in various places, if the US continues on the Obama growth of government, deficit and debt, that we are following in the footsteps of European Social Democracies.

Amicus

 

[JAMESBJOHNSON]

I blame the accordions and berets.

 

[amicus]

I blame the accordions and berets.[/

QUOTE]

~~~

That is succinct; maybe even a record in brevity for you JBJ, congrats!

This is not just academic to me as I foresee a general collapse in Europe and I can only muse if Fascism or Communism will replace whatever they call their current forms of government.



Amicus...

 

[Handley_Page]

Ogg and I are in the UK, which (praise the Lord) still has not managed to loose itself in the 'Euro'. The problem with the PIGS group (it's a horrible name) is that they are seen as having a history of instability in one form or another.

But, mon Ami, there is no perfect system (I heard yesterday of the New Zealand voting option, "None of the above" - could work here). We in the UK are generally happy with our Health Service (but hate the governmental targets, tick-boxes and general interference), and no tax system is ever going to please everyone.

 

[amicus]

Ogg and I are in the UK, which (praise the Lord) still has not managed to loose itself in the 'Euro'. The problem with the PIGS group (it's a horrible name) is that they are seen as having a history of instability in one form or another.

But, mon Ami, there is no perfect system (I heard yesterday of the New Zealand voting option, "None of the above" - could work here). We in the UK are generally happy with our Health Service (but hate the governmental targets, tick-boxes and general interference), and no tax system is ever going to please everyone.[/QUOTE]

~~~

It being near 2am here, I wish you a pleasant morning and thank you for your take on things.

On "there is no perfect system", considering the faults and temptations of mortal man, I suppose that is accurate. However, I am an ideologue and a purist at that and hold that the 'perfect system' is the one wherein human individual lives and liberties are protected and the devil hang the hindmost.

Human liberty implies a free market of course and that should be the aspiration of all rational individuals.

I can almost hear you thinking, "gee, it must be nice to be so absolute and certain in ones' thoughts..." and yes, it is nice but certainly subject to criticism and queries from all sides.

I seldom meet any who understand and appreciate my position, let alone who might be in agreement with my fundamental premises, but then, it takes all kinds of people to make a world and I am but one.



Amicus

 

[JAMESBJOHNSON]

The fundamental problems with every form of government are: All you own and possess is never enough to slake the greed, and every government exists to perpetuate itself....with bribes, promises, or violence.

 

[amicus]

The fundamental problems with every form of government are: All you own and possess is never enough to slake the greed, and every government exists to perpetuate itself....with bribes, promises, or violence.

~~~

Are you fully a cynic, JBJ, or would you put on your pointy headed thinking cap and approach a possible answer to the 'fundamental problems with every form of government...'?

Could there not be some codified and enforceable limits to the size of government, say a ratio of one for every....xxx,xxx number of citizens? Could there not also be means, many of which are in our basic documents, that limits the influence of government despite all the 'bribes, promises and violence?'

Just askin'



Amicus

 

[oggbashan]

Greece's problems are largely of its own making.

Their government campaigned hard to join the Euro zone despite not meeting the criteria for financial management. They then lied to the Euro Zone financiers (and their own electorate) about their debt mountain.

One of the reasons the UK didn't join the Euro was that our government weren't sure that they could continue to meet the conditions of financial control. If we were a member now, we'd be in difficulty. So would the US be, because the US's finances wouldn't be sound enough for Euro Zone membership.

The acroynm PIIGS, Portugal, Italy, Ireland, Greece and Spain refers to those countries in the Euro Zone who are not meeting, or are close to breaking, the debt criteria for membership. If Greece defaults, the others would be at risk.

There is another acronym - the STUPIDs - Spain, Turkey, United Kingdom, Portugal, Ireland, Denmark - all of whom are in trouble with their debt as a proportion of their GDP. For many of them and particularly the UK their problems were mainly caused by the US's toxic debt market which European bankers were stupid enough (hence the acronym) to back with real money now lost. All those countries are on course to correct their deficit over a period of years by taking painful measures to repay debt and reduce expenditure. Greece's government has had its head in the sand, believing that their problems would go away if they ignored them.

Whether the Greek government can actually introduce the necessary measures is doubtful. The statements of support seem to be just words with no real financial backing. Unless the other Euro Zone countries actually guarantee Greece's debts there will still be a crisis.

The good news? For me it means that I can buy more Euros with my pounds when I go to France.

Og

 

[amicus]

A thoughtful response, Oggbashan, but one not in accordance with content of the source links or fact.

To place blame on the US, however toxic the output of F & F, is to avert the reality of failing economic and social programs in the PIIGS nations.

You always defend your Nation, I understand that, as I do the same for mine. I also see things through American eyes centered on my Nation as you most likely do yours.

And of course I have a political point to make, that of what I consider the inevitability of failure in all socialist and semi socialist nations.

That is not to say that I do not respect the practicalities of your political and economic views as you have exposed them, in a purely pragmatic sense, I can understand the necessities you strive to meet.

I do regret that we differ so greatly concerning economic philosophy and human rights.

Top of the morning to you and yours...



Amicus

 

[oggbashan]

A thoughtful response, Oggbashan, but one not in accordance with content of the source links or fact.

To place blame on the US, however toxic the output of F & F, is to avert the reality of failing economic and social programs in the PIIGS nations.

You always defend your Nation, I understand that, as I do the same for mine. I also see things through American eyes centered on my Nation as you most likely do yours.

And of course I have a political point to make, that of what I consider the inevitability of failure in all socialist and semi socialist nations.

That is not to say that I do not respect the practicalities of your political and economic views as you have exposed them, in a purely pragmatic sense, I can understand the necessities you strive to meet.

I do regret that we differ so greatly concerning economic philosophy and human rights.

Top of the morning to you and yours...



Amicus

Your political point, as usual, is irrelevant.

This crisis was caused by bankers lending money and leveraging to ridiculous extents. Part of that was caused by bankers in the US. The UK and European part was caused by our bankers, many of whom had and have considerable exposure in the US which is still the world's largest economy. When a large US bank collapses, it brings down or impacts severely on its European branches and associates who had been behaving in a similar manner.

It has been said before: When Wall Street sneezes, the London Stock Exchange catches a cold.

Og

 

[amicus]

Oggbashan: "Your political point, as usual, is irrelevant."

~~~

I can understand, more or less, why you incorrectly believe that. Coming out of the terror and dismal aftermath of World War 2, the loss of Empire, the diminution of influence in the modern world, I suspect you, and many British intellectual elites have rationalized the decline into socialism as a necessity.

I think it was you who replied to an earlier Post of mine concerning "84 Charing Cross Road", a film, and a reminder as I looked upon Charing Cross Underground Station, if memory serves, in the 1970's.

I recall the joy of the owner and employees of the bookshop upon receiving gift packages of food from America.

Neither my political point or philosophy is irrelevant, not in the least, when you consider philosophy and the concept of individual value that underlies all that I write and think.

I sense a 'soul sickness' in your words, a sad acceptance of a perceived reality that does not leave room for individual hopes and dreams.

I sense somewhat the same here but from a different direction, a tiredness and resignation to being the 'World's Policeman', which seems fruitless and so very costly in human lives.

I do thank you for your thoughts; they give me the insight to write and think with your perspective in mind.

Amicus

 

[oggbashan]

Amicus,

What you continually fail to understand is that our mixed economy, which is NOT socialism, is supported by the majority of the UK's population including all three political parties.

Part of our financial problems, which are shared by the US, are caused by the massive cost of supporting our troops in Iraq and Afghanistan. The UK is there, as an ally, supporting the US and every day our news service reports another UK serviceman killed defending our shared freedoms.

Those freedoms include the ability to choose our government, and to choose what our government does. The UK's choice is not the same as the US. We choose to have a National Health Service which provides health care to everyone regardless of ability to pay and whether there are pre-existing conditions. But we can still choose - to use the NHS, to pay for private treatment either directly or through insurance, or to use the NHS for some things and not others.

Many of the "socialist" ideas of the UK's 1945 Labour government have long since gone but the NHS and social care for the weaker members of our society still exist - because the electorate choose to keep them.

Many of us cannot understand how a rich country like the US can deny basic medical care to some of its citizens and impoverish others through health costs that are beyond their citizens ability to pay - but that is the US's choice.

I think your philosophy is repugnant - it shows no compassion whatever for the sick or handicapped. The majority of the UK's electorate continually express agreement in rejecting your position.

Og

PS. I'm not going to reopen the arguments about what happened post 1945 when the US supported former enemies but tried to impose regime change in the UK by economic warfare...

 

[ishtat]

Amicus,
Part of our financial problems, which are shared by the US, are caused by the massive cost of supporting our troops in Iraq and Afghanistan.

.

Ogg, would you agree that despite these commitments UK expenditure on Social welfare is more than double that spent on defence and is increasing rapidly whilst defence expenditure has in real terms been cut since Blair/Brown took power.

Gordon Brown has added almost 600000 people to the public service payroll since 1996. That surely is profligate waste. I'll make a small wager that by this time next year whatever government is in power in the UK will target a 10% reduction in government expenditure within the context of a Public employment freeze.

 

[amicus]

Many of us cannot understand how a rich country like the US can deny basic medical care to some of its citizens and impoverish others through health costs that are beyond their citizens ability to pay - but that is the US's choice.

I think your philosophy is repugnant - it shows no compassion whatever for the sick or handicapped. The majority of the UK's electorate continually express agreement in rejecting your position.

~~~

I said earlier, I appreciate your contributions as they permit me to better understand. That you use such a word as 'repugnant', indicates you have little or no understanding of what America is or stands for.

A 'rich country like the US' actually provides more and better care for those in need than does your NHS. The wealthy here as in Britain always get the best care regardless. It is the marginal middle class that does not qualify for government aid that face difficulties when catastrophic illnesses strike.

So your propaganda, "shows no compassion whatever for the sick and handicapped" is just that propaganda and wrong headed and untrue.

What I find repugnant about your preferred way of life, is the grinding mediocrity nurtured by a socialist system that has failed and failed miserably everywhere it has been practiced.

It is not upon the common man, your, "UK's Electorate", that I place the blame, it is upon you and your intellectual counterparts who advocate sacrificing individual liberty for the comfort of a nanny state existence.

We have a Constitution that forbids the sacrifice of individual rights regardless of the majority that may wish to do so; you do not and you can, and have, voted your selves into a semi socialist state. What else can you do, Oggbashan, but endorse what you helped to create?

I lost a great deal of respect for Great Britain while watching "The Long Way Home", a 1997 production concerning the treatment of DP's, Displaced Persons, from 1945 to 1948 and the cruel and inhuman treatment afforded the Jews and other displaced persons following the War.

Then, as now, the British seemed concerned with practicality and protocol and not the essential humanity towards a people seeking independence. Looking back on the morass left behind in former British Colonies around the world, it is perhaps fitting that you settle quietly into mediocrity and self contemplation.

Then it was British concern with the Oil of the Middle East and pandering to Arab interests that provided the pragmatic foundation for plans and policies in the Middle East.

You choose not to see or acknowledge the true and frightening evil in the concept of Marxism and that is your right and your choice. But when you attempt to export that truly repugnant philosophy, you will find objections, at least from me as long as I draw breath.

Perhaps someday your people will shrug off the Monarchy and write a real Constitution that guarantees and protects those basic human liberties you so easily dispense with.

Amicus

 

[Liar]

Well, at least it's nice of you to for once acknowlegde that Europe is in fact a bunch of very different countries.

 

[ishtat]

Greece's problems are largely of its own making.

Their government campaigned hard to join the Euro zone despite not meeting the criteria for financial management. They then lied to the Euro Zone financiers (and their own electorate) about their debt mountain.

One of the reasons the UK didn't join the Euro was that our government weren't sure that they could continue to meet the conditions of financial control. If we were a member now, we'd be in difficulty. So would the US be, because the US's finances wouldn't be sound enough for Euro Zone membership.

The acroynm PIIGS, Portugal, Italy, Ireland, Greece and Spain refers to those countries in the Euro Zone who are not meeting, or are close to breaking, the debt criteria for membership. If Greece defaults, the others would be at risk.

There is another acronym - the STUPIDs - Spain, Turkey, United Kingdom, Portugal, Ireland, Denmark - all of whom are in trouble with their debt as a proportion of their GDP. For many of them and particularly the UK their problems were mainly caused by the US's toxic debt market which European bankers were stupid enough (hence the acronym) to back with real money now lost. All those countries are on course to correct their deficit over a period of years by taking painful measures to repay debt and reduce expenditure. Greece's government has had its head in the sand, believing that their problems would go away if they ignored them.

Whether the Greek government can actually introduce the necessary measures is doubtful. The statements of support seem to be just words with no real financial backing. Unless the other Euro Zone countries actually guarantee Greece's debts there will still be a crisis.

The good news? For me it means that I can buy more Euros with my pounds when I go to France.

Og

I'm a bit pressed for time taking a break from writing a tedious report but there are a couple of points to raise here.

I agree with your first two paragraphs

With regard to the third, Spain, Portugal, Italy, Greece and most of the former Soviet satellites have lied about their finances. Greece is the worst and in particular always grossly overstates her tax revenues.

It's also worth recording that the EU accounts have not been signed off by an auditor for 15 years they are so corrupted.

Your statement that the STUPID countries "are on course to correct their deficits over a period of years" is simply untrue. Apart from Ireland they have all done next to nothing and in the UK case the current failed government is holding out desperately for an election in May . Brown has printed money like confetti to so say pump prime and what has he got; 3% inflation and the weakest rate of recovery in the western hemisphere.

I agree with your penultimate paragraph. The Greeks have been living a lie for so long that their people are going to revolt when they are told the terms of the bail out.

So far as the pound and the Euro are concerned I suppose that the comfort of your holidays may depend on which currency races to the bottom first!

Finally, we have heard our American friends complain loudly about the management of their economy over the past few years but they have some good signs. US balance of payments was vastly improved in final quarter 2009 and a lower dollar is going to help their recovery. My bet is that in two to three years the US recovery will decisively better Europe's.

Now back to real work.

 

[JAMESBJOHNSON]

OG

America's poor are denied nothing. They have Medicaid, every county in America has public health cliniics where services are free or almost free, hospital emergency rooms cannot refuse treatment based on ability to pay, and many places have indigent healthcare tax to treat the working poor.

America's healthcare crisis involves the following:

1.80 million people are poised to join the retired-elderly; this is 1/4th of all Americans.
2. Mega-hospital corporations are buying up the small, independent & public hospitals.
3. Mega-hospital corporations borrow huge sums of money for executive pay and benefits; the loans are passed along to the hospitals to pay.
4. Our Federal government spent all of the money in the Medicare Trust Fund.
5. HMOs were created in the 1980s to contain hospital costs, but what happened was mega-hospital corporations absorbed the hospitals and told the HMOs to fuck themselves if they didnt like the costs. The HMOs, given the like it or lump it choice, increased premiums.
6. Insurance companies invested in all the ruinous get rich schemes like the dotcom stocks, subprime mortgages & bundled credit packages, etc. and lost their asses.
7. American politicians allow American companies and elites to offshore income and profits, to shield the money from taxes.

 

[oggbashan]

Amicus,

You gave yourself away with the publications you quoted in your first post.

The Socialist Worker and the Socialist party have about as much relevance to mainstream UK today as Prohibition does in the US. They are publications and organisations that represent a tiny minority of nutcases.

If you are going to throw stones about the treatment of displaced persons after the war, perhaps you should look at the US's treatment of Jews from Germany before the war, and the Yalta agreements on post war resettlements between Stalin and Roosevelt over the objections of Churchill.

The UK cannot claim clean hands. The US cannot. The USSR, which no longer exists, threw the dirt which the rest of the Allies caught.

You can't have it both ways but you usually do. If the British Empire was a bad thing, why did we give independence to so many countries after WWII and why does the Commonwealth of Nations still exist and attract members that were never part of the British Empire. Has the Philippines been a shining example of a former US imperial colony? Are they now?

I don't recognise the "grinding mediocrity" you attribute to the UK. We are not the same as the US. We do things differently. In some respects we are better. In some respects the US is better. Some countries are better at some things that either of us, but both the UK and the US are far better, democratically and economically, than the majority of countries in the world.

If I thought that you, Amicus, were typical of US citizens, then I would despair of the US. But I know that you are not.

Next month I'll be meeting some US friends at Heathrow. They give me a far better picture of the US than you ever do.

Og

 

[PoppingTom]

..., I have included two socialist references which, not surprising, blame Capitalism for the possible collapse ol Portugal, Ireland, Greece and Spain.

Some are predicting a break-up of Euro settling out in the Russian Republic style after the internal collapse of the Soviet Union; others see a Communist China version of controlled Capitalism and no human rights.

Still others see the collapse of EURO as inevitable and are concerned that the US and the rest of the world may be dragged into a major depression.

And Me, living definitely in the euro zone, don't see anything of that.

In 10 years, I promise you, we will still living and still will read about the next possible breakup of whatever in the EU.

I don't see Europe without electricity because of failed management, like happened in California.

I don't see Europe breaking up, as it isn't really a state, but wants to become one. A lot of people see the danger, that Europe will be a dictatorship, if it really was a state.

And I absolutely don't know what implies "collapse of Euro". Maybe it means the same thing as the collapse of the dollar. A few rich people will get heart attacks by watching the course, and the world's still turning, so what ?

 

[colddiesel]

I don't see Europe breaking up, as it isn't really a state, but wants to become one.

Show us a single piece of evidence that "Europe wants to become a state," just one

Every democratic vote on the Lisbon Treaty voted it down but the Brusselcrats forced it through.The arrogance of that diktat will come back to haunt them, it's just a question of time.

Do you have a direct interest in the EU project?

I don't think it will break up entirely but within ten years the core of the EU will go back to the original 6 less Italy ie Germany, France, Benelux, maybe plus Sandinavia. Germany will recolonise the East economically and the biggest question Europe will have to answer by 2020 is how will they cope with a German nation free from post war guilt which is pissed off with paying for its profligate neighbors?.

 

[PoppingTom]

Show us a single piece of evidence that "Europe wants to become a state," just one

Well, the Eu has its own flag, has its parliament in Brussels, is doing laws that is binding to every member - what kind of evidence do you want?

The question is not, if EU will be a state in the future, but what kind of.

Do you have a direct interest in the EU project?

Tell me the bad thing about it. Except the danger it could end into dictatorship. A willing dictatorship of all participating democracies, which is hard to believe.

I don't think it will break up entirely but within ten years the core of the EU will go back to the original 6 less Italy ie Germany, France, Benelux, maybe plus Sandinavia. Germany will recolonise the East economically and the biggest question Europe will have to answer by 2020 is how will they cope with a German nation free from post war guilt which is pissed off with paying for its profligate neighbors?.

Well, thats what USA is always talking about Europe, the last 20 years ago. And again, something that doesn't exist, can't break up. EU could only break up because of ethnical probs. In fact, why wants Turkey become part of the EU, if EU is close to break up and got Turkey's biggest Enemy, Greece, as member ?

 

[TE999]

Like it or not, the worlds economies are inextricably intertwined. The US was always the bulwark of international finance because of our output of goods and services and our fiscal policies. The Rooseveltian sojurn into governmental control of the US economy in the 1930's including draconian tariffs and leaving the gold standard accellerated the rise of National Socialisim and Facisim in Europe as their economies withered.

Currently, with the US in economic thrall to China and other countries due to our borrowing to keep the welfare state afloat, we're entering a similar period of global peril. The US military is all that stands between the world's democracies and totalitarianism and Muslim extremisim. If we begin to starve it in favor of funding a burgeoning welfare state or retreat into isolationisim, the 'free' world is doomed.

Of course the world can embrace petty dictators or Islam as a way of pacifying a restive populace, but it will be a heavy price to pay in terms of human liberty.

One is reminded of the scene in 'Watership Down' when Hazel and the other wild rabbits meet their caged brethren who prefer security and calmly await their slaughter for food to living in the wild. Both will die, but the wild rabbits are free to choose their destiny.

 

[PoppingTom]

... The US military is all that stands between the world's democracies and totalitarianism and Muslim extremisim.

I don't know why the country that has far the greatest impact to other countries in economic cases, attach such importance in his army, which is a high tech army, for sure, but doesn't have that success you swear so much. Of all American influences to the world, the army has quite the worst. It wasn't your army that brought Eastern Europe down. It wasn't your army that made China doing a change from destructive and much more suppressing Maoism to an economic emphasis. It wasn't your army that freed Cambodia from Khmer Rouge. I think the American economy, which is far more realistic in his objectives, has more influence to the world than your army. Even the fact that Saudi Arabia is not a much more evil twin of Iran is because of pure American economy. It's your money for the oil that keeps the Saudi Royals up and lowering Muslim extremism.

Off course, your army can help to change things. Just watch Yugoslavia. But that change was done together with the NATO, which, I think, is a much better strategy. But I know how much America is into self-doing and mistrusting everything that's not American.