Everyone said the vote would be close. It wasn't:
Figures published by the interior ministry showed 61% of those whose ballots had been counted voting "No", against 39% voting "Yes".
This is the true beginning of the rebellion against neoliberalism: A large segment of the world no longer feels very charmed by the current economic system.
We need an alternative.
The IMF has known since 2010 that the bailout terms imposed on Greece would serve only to make the situation worse. The "no" vote cannot have come as a surprise. Why were they not prepared for this day?
A commenter on Moon of Alabama
has it right...
While I sympathize with your frustration, the problem is the moral hazard created by the ECB and German government whereby private debt held by mostly German banks could be offloaded unto the backs of European taxpayers. Under those circumstances, why wouldn't banks lend money to an already heavily indebted country that had no hope of ever repaying it? Since the banks can unload their non-performing loans onto German citizens, while keeping profitable loans for themselves, that is what they did and what they will always do if you let them.
If you follow this argument to its ultimate conclusion, it seems possible that the another economic rebellion could begin to brew in Germany itself.
Greek governments — not the current, much maligned Syriza, but decades of its predecessors — treated the state like a teat from which clients and friends of electoral victors might suck. The Greek state has been a shady, opportunistic borrower, no doubt, the kind of character no one would lend money to with any great expectation of seeing it back.
And yet, that’s precisely what bankers in the relatively not-fucked-up Eurozone countries did! These people were not naïfs. They knew the Greek state was sketchy. But precisely because it was sketchy, prior to the financial crisis its debt paid slightly higher interest rates than that of safer Eurozone sovereigns. European banking regulations attached zero risk weights to all EU sovereigns, rendering it nearly costless for banks to simply manufacture deposits to purchase sovereign debt. Eurozone sovereigns were default-risk-free as a regulatory matter and currency-risk-free from the perspective of Eurozone banks. The European financial system was architected to make lending to Greece — and Spain and Portugal and Italy — a money machine for bankers with little career risk over a medium term. Sketchy credits tend to punch above their weight in terms of volume of issuance, so there was a lot of nice paper to buy.
You should read the rest of that essay; it's terrific.
Just before the vote, Paul Krugman
proved (with charts and everything) that austerity cannot solve the Greek crisis. The measure that everyone considers virtuous, effective and necessary does not have the virtue of effectiveness and is therefore unnecessary.
And just to be clear, I’m basically doing textbook macroeconomics here, nothing exotic. It’s the austerians who are inventing new economic doctrines on the fly to justify their policies, which appear to imply not temporary sacrifice but permanent failure.
So now the search begins for a new system.
A long time ago, I proposed an alternative. Let us recognize that industrial capitalism (making shit) and financial capitalism (Goldman Sachs and environs) are two very different animals, requiring two different sets of rules. Laissez-faire is for the industrial capitalists. Go get 'em tigers: The leash is OFF.
(Or at least is very elastic.) But socialism -- or, as some might call it, democracy -- should be the rule when it comes to finance capitalism. The Greek crisis would not have happened if the banks that made the loans were run by representatives accountable to an electorate.
The font conundrum.
I'm designing a new font, one designed to mimic hand-printing. It's primarily meant to be used in comics, but I think it could also prove effective in other contexts.
Just for giggles, this font will include all sorts of rare and unusual glyphs -- including the symbols for many of the world's currencies. Mine will be the first lettering font that includes symbols for Bitcoin, Litecoin and the new rupee. (Why? Because you never know. Maybe the mysterious inventor of Bitcoin was Magneto.)
Here's the thing: The euro has replaced many currency symbols. But as of today, the euro is falling fast. And by fast, I mean fast
. So now I'm wondering: Should I also design glyphs for the old
currency symbols, the ones replaced by the euro, the ones we all thought we would never see again?
We may need them soon.