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With An Imminent Irish Bailout Looming, One Politician Opposes US Participation In The Latest European Rescue
As the US, due to its key role as primary supporter of the various IMF rescue facilities, is already intimately involved in the Greek bailout (not to mention that the US Central Bank will soon again reprise its role as key lender of dollars, once the Irish crisis flares up again next week), there are those who are already calling to prevent the US from participating in yet another European bailout (second of many). The first person to have voiced this objection is Washington Congressmwoman Cathy McMorris Rogers, who in a just issued press release notes that she had warned the administration in April that a blank check for Europe would cause a “gathering storm." She is, of course, right. She will, of course, be ignored. We hope that politicians will gradually realize what traders have known for about two years - namely that courtesy of the Bernanke put, there is just no risk left, which means ever escalating bail outs until, one day, NASA will be sending out binary message to Alpha Centauri seeking the assistance of intelligent, and more importantly, rich, life to save the earth. Until then, the all in bet (with other people's money) will simply keep getting bigger.
From the issued release:
Congresswoman McMorris Rodgers Opposes U.S. Participation in Likely Ireland Bailout
Congresswoman Warned Administration in April That Blank Check for Europe Would Cause “Gathering Storm”
Washington, DC – Rep. Cathy McMorris Rodgers (R-WA), Vice Chair of the House Republican Conference, released the following statement after the Irish government opened negotiations with the International Monetary Fund (IMF) on a bailout which may cost over $80 billion. The U.S. is the largest contributor to the IMF, which has already committed $382 billion to bail out Greece and the European Union.
“All across America, people are suffering from bailout fatigue. In the past two years, we’ve spent hundreds of billions of dollars to bail out Wall Street, GM, Chrysler, Fannie Mae and Freddie Mac, and now we are being asked to contribute billions more to bail out Greece, Ireland, and other European nations which have spent and borrowed far beyond their means. At a time when America is already borrowing 40 cents of every dollar it spends, does it make sense for us to borrow more money (much of it from China) to help bailout Europe? A crisis caused by too much spending and borrowing will not be solved by more spending and borrowing. A ‘Euro-TARP’ is the wrong approach, and America should have no part in it.”
On March 24, 2010, Rep. McMorris Rodgers was the first Member of Congress to publicly oppose U.S. involvement in a European bailout – a bailout, which according to one leading IMF official – may cost U.S. officials between $50-100 billion or more. She called for the Obama Administration to vote against the Greek bailout at the IMF meeting and introduced a Congressional Resolution opposing the bailout.
In April 2010, she said, “The Obama Administration needs to understand that bailing out Greece will not solve Greece’s problems; it will only create a moral hazard that gets America more involved in the gathering storm of European bailouts…A Greek bailout today will encourage larger countries, such as Spain and Italy – which have similar problems – to get in line for American tax dollars tomorrow and continually delay the fiscal reforms that are necessary for a long-term recovery.” The growing likelihood of an Irish bailout confirms her diagnosis.
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Bailouts renege on America's long standing tradition of not succumbing to terrorist demands.
+10,000 good one.
Let's call it "The Hank Doctrine"
:-)
Lets look at this the way Bush would have: did Ireland help us out in Iraq?
+1
1/6 th of the American population has Irish roots.
And I'm sure the Irish government would happily accept donations from that 1/6th. Doesn't mean the country needs to donate. Because that's what it is...a donation.
...and experiencing the hot potato famine
No, I don't think that's how Bush and the rest of TPTB look at it all. I think it's far, far better to look at actual historical examples for how this game is played:
http://en.wikipedia.org/wiki/History_of_Newfoundland_and_Labrador#Crisis...
Newfoundland used to be separate from Canada. It was the debt crisis in the 1930's which caused it to voluntarily give up its direct self rule. One of the few countries that ever did. If it wasn't for its wild spending during the 1920's, and its inability to pay its debts later on, it could well be an independent country now.
Fast forward to today, and you see the exact same thing going on around the world.
This is the same game that's being played with Ireland right now. If Ireland doesn't decide to default on its debts, it's going to be owned, lock, stock and barrel, by the Banksters. That is the name of the game, and is one which George Bush would very heartily support.
I did not know that. Very insightful indeed and, yes, this is what's reverberating around the world today. If it weren't for the post-WW2, post-Bretton Woods accords and political structures, I can think of a few countries that would sell their sovereignty.
Stuff like this is why Zh Rocks.
Thanks. It's always good to know that I've managed to reach someone with the big picture.
Now the next interesting thing is to extrapolate the above with the U.S.'s debt, the New World Order, and how the IMF fits in, especially with the talk of its SDR's replacing the dollar as the reserve currency.
There's some food for thought.
comical. that we would 'participate' in bailing a country out, when we need the fix ourselves. they want us to borrow a few more billions from china to give to euro zone countries. would be funny but it is true.
The budget for the IMF has to be approved by Congress. I've been leting my Representative adn Senators how I feel on this issue.
nothing a EMERGENCY meeting within the next 48 hours won't fix.
Re.: Irish Problem
First its not an Irish problem.
Its a banking problem and its not even an Irish banking problem.
Its a U.K., German and French banking problem. More specifically, its a problem for their investment funds. The funds took advantage of the low corp. taxes, liberal regulatory regimes to invest in Ireland.
NOW, the IMF, etc. want the Irish gov. to take a 5% loan and raise the corp. taxes on those companies that set up shop in Ireland.
The USA says, all the time, that if you raise taxes on the rich and on companies then you will kill the recovery.
Why does that argument and logic not work for Ireland?
The Irish gov. will be forced to take the loan and raise the tax rate on the companies.
The problem ... realizing the increased income from that raised tax rate.
I can think of lots of way that would NOT result in increased revenues for the gov.
No, I’m not greek or irish.(Donations to Charity)
"The problem ... realizing the increased income from that raised tax rate."
Exactly, expect massive corporate flight from Ireland into lower tax countries. Say hello to Eastern Europe "Apple Europe."
am i not correct that this solution as been tried and worked in Africa?
+10 ngmanguroguro berries
Even more so it is a European banking problem and if one nation haircuts its sovereign debt it invalidates the entire farcical 'stress test'.
It isn't the IMF that wants Ireland to raise its 12.5% corporate tax so much - it is France and Germany that want a shot at some of that services business, the IMF is just going along to get the package put together. No way a bunch of hardheaded Irishmen cave on that one because if the Google and all the tech and financial services guys leave then real estate collapses...and, what the IMF is very concerned about is the fact that banks haven't written down real estate much at all - in fact they have been refinancing problems at mortgage rates below where they are rasing capital just to keep the farce alive!
Ireland need is at least $150B as is Portugal. So add those two to Greece and you get about $400B which leaves $300B for Spain. BUT, Spain is now believed to be atleast $700B and since France is the largest holder of Spanish debt and especially cajas debt France is right behind Spain. The most fascinating thing is the Italy is getting away with lying about their debt and bank problems and everybody knows it but, that just makes the problem bigger so they are whistling on by.
Oh, and the only thing in the stabilization fund is a bunch of promises because Austria and Finland have already started renegging publicly and 4 more countiries have privately. I would expect the first traunche of the Irish 'bailout' to be relatively small with the caveat that the 'tax haven' issue will be worked out separately.
It's all likely to collapse anyway the question is how long it takes - probably the slow burn with an acceleration and nice implosion at the end...don't be short $US when it happens because wealthy European families have alredy started moving into the CHF and $US thourgh the Swiss banks.
+1
nice post mark
@MarkS
Whatever bailout amounts we think those countries "need", it's probably wise to double them as an allowance for culinary accounting and "lost" records. And if we think this EU mess is bad, just imagine what the PBOC is going through to manage their little shit storm.
a republican chick with a hyphenated last name
Forget de-funding NPR de-fund this banana sucking gorilla called IMF
I say lets turn google's dutch sandwich into a shit sandwich.
YM
Overhead resistance.
http://99ercharts.blogspot.com/2010/11/ym_19.html
http://www.zerohedge.com/forum/99er-charts
I'm afraid Ms. Rogers is going to have a very unfortunate accident on a very lonely road.
Just have The Bernanke politely insist it's in every-one's best interest that China buy Ireland and Portugal.
Why should we borrow from China to do it?
Problem solved, another "I'd Like to Teach the World to Sing (In Perfect Harmony ...)" Coca-Cola moment.
Damn, my eyes are filling with tears.
when the world is awash with worthless greenbacks and the IMFers can no longer lay claim to sovereign status then a global currency backed (supposedly) by gold and/or unicorn tears will magically appear to stop the pain. the promise of more fried chicken and a full cable package will be irresistable.
because once US owns all countries they can default on the debt to china and then invade china.
there are 4 chinese for every American.
The US doesn't have the means for that.
I don't think they'll like the food over there, either.
. . . which means ever escalating bail outs until, one day, NASA will be sending out binary message to Alpha Centauri seeking the assistance of intelligent, and more importantly, rich, life to save the earth.
Dmitry Orlov has been calling for the need for an alien intervention since last year.
Illegal alien intervention at that...riding a top of their hyperdimensional corn tortilla saucers and firing deadly blasts of fiery, hot, manchego, jalapeno cheese they will save us.
Tyler, Why no report about that Texas governor that wants to invade Mexico?
That was pretty funny to see :)
@Sudden
Mexico and Canada will both be annexed by the U.S. under the guise of national security. We need Mexico's younger demographic to pay taxes, and we need the resources from both land masses.
The invasion of Mexico will happen within ten years, and Canada will be coerced to join the North American Empire.
I had a premonition that I posted in 09 that, somehow, the Fed would be behind bailouts of a conga-line of countries, beginning with Greece and Dubai, and including not just the PIIGS (with Italy as a 3rd I), but the Baltics, most of Eastern Europe, Belgium, Egypt and a few more.
They're not only going to do it, they're already doing it indirectly by subsidizing Dollar swap lines, IMF loans and allowing the interconnected banking system to hide all manner of insolvent debt and derivatives.
How is this all going to end?
Tyler and co are on to it: the irony of the mass bailouts is that they only beget more bailouts. By taking risk out of the equation, spending only becomes more irresponsible and inefficient, not less.
Same goes for the banking system and Wall Street. The only thing they've learned is that by losing big, they win big when the Fed comes riding to the rescue.
This congresswoman is one of the few good ones - she was one of the few to come out publicly against QE2.
yea .............. i thought the U.S. had a POLICY of NOT DEALING WITH TERRORISTS !! & these people are terrorists, you know.
Question:
Is the administrative staff of the Federal Reserve Board . . . are they Federal employees in the US Civil Service?
If so, they could be defunded in the House. Ditto travel expenses and anything else required to conduct their function.
The banks are paying 1.5% to the ECB and now the ECB wants to transfer this shit to treasuries all over Europe and they want Ireland to pay 5% to other Goverments !!!!!!!!
Gentle Ben get over to the emerald isle baby and kick that bum Jean claude out
...which means ever escalating bail outs until, one day, NASA will be sending out binary message to Alpha Centauri seeking the assistance of intelligent, and more importantly, rich, life to save the earth.
Woooo heh, heh, haaaah!...
And those expected cash flows will be securitized and trading 'when-issued' before the transmitter on the rocket even leaves the launch pad!
Is this a great planet or what?
They're going to love us out there.
QUAYLE/QUAYLE 2012!
PALING FOR FED CHAIRWOMEN!
GOD BLESS THE AMERIKAN OBESE CONSUMER
ROTFLMAO........ your campaign slogans get richer every post. thanks
Westlife call for Irish "positivity"
http://www.bbc.co.uk/news/business-11802271
It's all over when the boy band sings...
They can save the Sovereign debt or the Banks, but not both. Twas a Mistake to guarantee the Bank debt.
Restructure the bad debt, dissolve the Banks is the only way out, money is fleeing and will continue to until the debt is disposed of.
The Debt is there Ben, waiting for you.
Remember the old days of the S&L fraud crisis?, debt was disposed of, 1000 perps went to jail.. This one is FORTY Times bigger and with not a single Arrest. The ECB, IMF, Fed are all in serious denial how bad this is.
It's evident in the outflows of mutual funds, if the investor class knows the sham that is being played out its almost game over.