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Portugal's "Left-Wing" Forces Threaten Troika Revolt
As we discussed on Wednesday, Europe — and now at least one ratings agency — is doing its very best to trigger a terminal bank run in Greece and thereby deal the final, destabilizing blow to the country’s radical socialist saviors (Syriza) who, in the event the ATMs go dark or depositors end up Cyprus’d, would be forced to either concede to each and every Troika demand in order to get a deal (thus abandoning campaign promises and its entire mandate in the process) or risk social and political instability and the prospect that Greeks will eventually decide that a government of pandering technocrats beats starving any day of the week.
In this context we asked if perhaps it was time for Greeks to ask themselves if this is the kind of "European" partner they want to bind their fate to: a partner that will do everything in its power to subvert a democratically elected government, even if, or rather especially if, it means a wholesale "bail-in" for Greek depositors, who may lose as much as 70 cents on every euro.
We went on to say that after Greece is done soul searching, the people of Spain, Italy, Portugal and Ireland should ask the same question, because if we have a Grexit in two weeks, then these countries are next.
Well don’t look now, but Portugal’s Socialist Party (which leads in the polls ahead of an expected October election) is pledging to implement a “reverse policy” as it relates to austerity and relations with the Troika.
The Telegraph has more:
Europe faces the risk of a second revolt by Left-wing forces in the South after Portugal’s Socialist Party vowed to defy austerity demands from the country’s creditors and block any further sackings of public officials.
"We will carry out a reverse policy,” said Antonio Costa, the Socialist leader.
Mr Costa said a clear majority of his party wants to halt the “obsession with austerity”. Speaking to journalists in Lisbon as his country prepares for elections - expected in October - he insisted that Portugal must start rebuilding key parts of the public sector following the drastic cuts under the previous EU-IMF Troika regime…
“There must be an alternative that allows us to turn the page on austerity, revive the economy, create jobs, and – while complying with euro area rules – restore hope to this county,” he said.
While the Socialist Party insists that it is a different animal from the radical Syriza movement in Greece, there is a striking similarity in some of the pre-electoral language and proposals. Syriza also pledged to stick to EMU rules, while at the same time campaigning for policies that were bound to provoke a head-on collision with creditors…
Mr Costa unveiled a package of 55 measures in March, led by a wave of spending on healthcare and education that amounts to a fiscal reflation package. The party would also roll back labour reforms and make it harder for companies to sack workers…
The plan would appear entirely incompatible with the EU’s Fiscal Compact, which requires Portugal to run massive primary surpluses to cut its public debt from 130pc to 60pc of GDP over 20 years under pain of sanctions.
The increasingly fierce attacks on austerity in Lisbon are likely to heighten fears in Berlin that fiscal and reform discipline will break down altogether in southern Europe if Greece’s rebels win concessions. Worry about political "moral hazard" is vastly complicating the search for a solution in Greece.
“Greece is the testing ground and everybody is watching very carefully. That is why the Spanish and Portuguese prime ministers have been so hawkish,” said Vincenzo Scarpetta, from Open Europe.
In other words, the reason why concessions (any concessions) to the Greeks are a non-starter in Athens' negotiations with creditors is that the IMF, the European Commission, and most especially Germany, want to send a clear message to any other 'leftist radicals' who may be thinking about using the "one move and the idea of EMU indissolubility gets it" routine as a way to negotiate for breathing room on austerity pledges, will get exactly nowhere and will have a very unpleasant time on the way.
Of course the situation is a bit different in Portugal, as the country is not beholden to "the institutions" to the same extent as Greece. That said, once someone gives you a $78 billion loan, it's likely to be a long time before they give up their right to have a say in your affairs especially when the balance isn't completely paid off. More from The Telegraph:
Portugal is no longer under Troika control. It exited its €78bn bailout programme last year and returned to the markets. It is currently able to borrow money for 10 years at an interest rate of 2.35pc. “We no longer have any direct leverage,” said one EU official...
That largely depends on the definition of "direct leverage"...
However, countries remain under “post-programme surveillance”, with two monitoring missions on the ground each year until they have repaid 75pc of the money. Portugal will not be in the clear for a long time.
The legal text stated that the council of EMU ministers can issue “recommendations for corrective actions if necessary and where appropriate”. The EU bail-out funds (ESM and EFSF) have their own “early warning mechanism” to ensure that debtors stay on the right track.
Yes, "recommendations for corrective actions," and let's not forget the fact that one of the reasons Portugal's borrowing costs are low enough to where it makes sense for the country to essentially refi its IMF debt (which carries an interest rate of 3.5%) by tapping the bond market at what, until recently, were sub-200bps yields on the 10-year, is the ECB's implicit promise to "do whatever it takes" to support EMU member nations. Further, should the country suddenly slide back into the fiscal abyss (which, if you look at the numbers is not at all out of the question) and need another "program", EU officials will want to ensure the country's government won't be able to point to the Greek negotiations for examples of Troika leniency.
We'll close with the following graphics which demonstrate the precarious situation the country still faces even as its politicians look to rock the austerity boat:
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I am thinking that all of the second tier European countries (which includes all Euro countries except Germany and Belgium) should get together and form a new EU and create their own currency.
They should then increase the price of wine and olive oil 100X to Brussels and Frankfurt... and refuse to accept Euros in trade.
I am thinking that a lot of thinking is spent by people trying to analyze the eurozone and what "ought to be done" here
and here on ZH I often find out that they aren't in the eurozone, or aren't in those countries, often are absolutely not socialist, and the countries where they live overspend moar then in the wildest dreams of the socialists that are protesting against "Austerity"
add to that a horrid fascination with the EUR. oh, the ink spilled trying to explain the euro, deflecting from any even cursory glance on the "Fiscal Compact"
I sometimes feel like I am the only "Austrian School" proponent, here. The main trust of criticism against the EUR is neo-keynesian
meaning against balanced budgets, against "living within your means", against responsible, limited but nevertheless functioning nation-states
the EUR is... more "Austrian School" then anything else we have ever seen on this planet with the exception of the gold standard
even more, the EUR "project" is not even opposed to a gold standard, just a facsimile of what can be done in the current (and changing) environment
I can understand socialists being against this kind of non-spending, and particularly against the repayment of accumulated debt
I can also understand the other parts in the eurozone being for balanced budgets and limitations of the spending of their nation-states
what I cannot understand is this external horrid fascination... without having a look in the mirror. ok, being anarchist helps, I suppose, to say it's all oppression
but then please point me to a really existing and functioning territory where you can live without the state, in peace. as long as that is an utopia... be a bit more realistic
reality is a waning and yet still existing King Dollar dominance, the current currency wars and a great battle for the banking systems. hence... the EUR
Few people follow a train of thought, most react to the bell ringing rather like Pavlov's little dog.
The US is the spendthrift nation bar none have "taxed" global savings for decades to fund an imperial decadent lifestyle and built China into a major rival since Bill Clinton signed up to the program.
There is not a single EuroZone country that has not been induced to follow the shining star of US necromancy and built financial castles in the air - Germany turned a stolid bank like Deutsche into a Debt Bomb by embracing Wall Street and financial-engineering consultants from Goldman or Lehman or Merrill showed every third-tier country how to play at the casino........they are even at it in Ukraine today.
It is Neo-Colonialism and emanates from London and New York loan-sharking
This "socialist" dirtbag isn't threatning anything...
He's full of shit. Now he promisses the world, when he wins, he'll kiss the troika's ass and contimue selling the country's assets to JP Morgan, Goldman and friends.
If anything, under his rule, things will aggravate quite sharply.
Portugal....
Neighbouring Spain. Just across from Morocco. Key African transition point...Africa in focus.
Portugal ready to go colour revolution....so that Spain can be next...
Check this out....very telling (I think)...
https://aadivaahan.wordpress.com/2011/03/09/axis-of-evil-doing/
like a dot connector...dot dot dot...
EU/Africa in Africom's cross-hairs...
"Portugal's "Left-Wing" Forces Threaten Troika Revolt". In what remains of the free world, we call this 'contagion'.
"I sometimes feel like I am the only "Austrian School" proponent, here."
I'm so Austrian, I speak German.
I personally consider Man, Economy, and State the "New Testament," after the "Old Testament," Human Action. Now, while not strictly Austrian School, Hayek's Road to Serfdom changed my life. Completely changed how I thought about politics and the world around me. Then there is Say's law, a sort of 2nd. Law of Thermodynamics for economics. Hoppe's views on Property and Liberty are profound. Hazlitt, Callahan...
The largest and most unexpected change for me after I discovered the Austrian School in the Summer of 2003, was my relationship with my personal Liberty--I own me, and I own my product, and all else follows from there.
And then being Austrian is a source of humor for myself whenever I am accused of being antisemitic for mentioning Zion and Zionism.
Liberty is a demand. Tyranny is submission..
The euro might have worked if it had started out much smaller... Germany, Beligum, Holland, Luxembourg would have been a good start..... then get the Sweedish and Swiss interested because it's soild.... UK was sorely needed..... then order the frogs to get their house in order... Denmark, Norway, Finland.... leave the southerns for last....
you can't do currency integration without political integration
meaning that when gold was the world currency we had a world government?
It means we didn't need a world government.
meaning it is not "working"? look how much debate it's causing, and look how many people have already buried it, including you
meanwhile, look how you are trying to include countries that aren't interested in joining: the UK, Denmark, Norway, Sweden
if you look at the EUR from a political project point of view, you have to start with the three core EUR countries: France, Italy and Germany
if you look at the EUR from a monetary project point of view, you have to start with gold versus King Dollar
(or, if you listen to China and other BRICS, with gold versus King Dollar versus a reformed IMF with an SDR or with the new AIIB and it's possible new synthetic currency)
instead, you are looking it from a completely different point of view, and one that is not shared by the... eurozoners themselves
BoPeep - can't tell if you had your /sarc tag on or not, but that actually isn't a bad idea...... The horrid problem with the Euro from day one was that currencies were locked together without the means to move wealth back and forth between countries. In other words, they eliminated the usual currency fluctuations without turning the whole of Europe into a single economy. Counter-example: in the US, when Alabama gets trashed by a hurricane, fed $$ assist, paid for by folks in other states...mechanism is already there.
Although the solution for Europe is really only at either end: back to separate currencies & economies....or single economy overall; this idea of lumpy sub-Euros is a fair compromise. separate out and conglomerate into groups of likewise economical worth. Italy & Greece & Spain can make the highly inflated shit-euro..... Germany & Belgium the strong-currency master-euro, and everybody else in the midlands cheez-euro. It would last longer...at least until the winds of fortune started blowing different headings here and there.
"The horrid problem with the Euro from day one was that currencies were locked together without the means to move wealth back and forth between countries."
moving wealth back and forth between countries is actually one of the "Four Freedoms" of the EU
what you mean is that inside the eurozone or the EU there should be "fiscal rebalancing", i.e. you are arguing how tax-payer money ought to be spent
isn't that a political issue?
You claim to be an anarchist in the above post; in which case there should be no "tax-payer" money that "ought" to be spent on x or y. I assume that is your stance?
I would be an anarchist if I thought it would be feasible. but it isn't, imho, so I am only sympathetic to anarchist criticism. which is often excellent
What a lot of people in the eurozone (in the PIIGS mainly thus the antiausterity messages from mainstream politicians) is how NOW that there is a huge out in the open euroQE program there is not even the prospect of a loosening of the hard austerity measures that affect their livelihoods.
(as opposed to the UK where QE was linked to the banking systems collapse avoidance the euroQE has been presented as economic growth promoting thus the implicit suspicion...)
Regardless of who wins the next election and what promises they make up upfront - you can't get around reality land
Portugal can't co-exist in the same currency than Germany, Netherlands, Finland, etc. Most people that defend this idea do it on the basis of economic reasons, but my post below goes beyond that. In the end it's our culture, history and dictatorship past that will drive us OUT of the EURO. Hard to predict when, though. The bureucracts in Brussels will be jobless otherwise, so will not be surprised if insanity last for a few more years!
https://contrarianstraighttalker.wordpress.com/2015/03/01/salazar-and-why-portugal-will-not-be-in-same-currency-as-germany-by-2025/
I could take your argumentation and use it with gold
"Country X cannot co-exist with Country Y in the same world using gold as money", ergo a pure gold standard is neither feasible nor would it be a good thing
now, how does that sound? I'd say like... Dr. Krugman's usual Neo-Keynesian tirade against the EUR... and gold
funny that Dr. Krugman would be very hard put if he would have to decide if he hates gold more or less then the EUR
“post-programme surveillance”
Further evidence that those in power consider Orwell's work – consciously or not – to be something of a playbook, rather than a dire warning.
PPS but i am sure it feels to Portugal as PMS.
Left-wingers don't threaten anything. They are the ones that created and adore this shit!
We are at the natural end-station of capitalism. All resources are almost depleted for profit (human and natural). The capital and wealth have been accumulated in the ownership-class to a level never seen in history before. The state is a servant of the oligarchy – the owners. The text-book definition of fascism.
I’ve seen this again and again on ZH. Blaming the ‘left-wing’. Who do you see as ‘left-wing’? Do you, falsely, think that ‘statism’ is especially ‘left-wing’?
The history of the term ‘left-wing’ is telling. In European countries most parliaments was physically divided in two – the left and the right wing. To the right was the owners of the state – the feudal powers and the supporters of the king/the state. To the left was the bourgeois (the capital owners) who questioned the monarchy/the state. Today it’s the same (all over the world – except in US). The left are the ones questioning the state/the oligarchy and the right are defending the status quo (or for a minority criticize the status quo for not being ‘capitalist’ enough = let’s be like the third world!). The capital owners have moved to the right side of the parliament (to take over the former seats/interests of the feudal class).
Only in US is libertarianism seen as a right-wing phenomenon – that’s very telling. Why is that? The history of libertarianism is left-wing and the current libertarian movement is still (outside of US) left-wing.
It might just be a difference in the use of concepts but it’s actually important to know who the enemy is. And the obfuscation of terms (predominant in US) is blurring our vision and making debate over the Atlantic difficult at best.
We should unite – fighting our common enemy. The global oligarchy.
Capitalism didn't fail us .... we failed Capitalism .... and stop with the simplistic name game .... there are only two words you have to know .... individual freedom .... everything else is playing scrabble on the deck of the Titanic !
“Simplistic name game …. there are only two words you have to know .... individual freedom”. Who’s being simplistic?
The real question is how you achieve the most individual freedom (and not just de jure but de facto).
Left-wing anarchists (including the libertarian strain) fight all forms of oppression – both the state and the market derived power/the capitalists. Capitalism is not a system of free individuals (even in it’s mythical ‘true form’). It’s a system that – in its nature – accumulates power/resources in fewer and fewer hands. The ones being born – by pure chance – into the lower strata of a capitalist society is born with ‘less de facto’ individual freedom than those born in the ownership-class.
So yes, we (I guess) share a focus on individual freedom but differ in the means to that freedom (you being right wing and I being left-wing – you being pro-capitalism and me being anti-capitalist/all forms of oppression. I’m guessing your political stances and I welcome a correction).
See
Down arrows, of course.
Many, many times I asked a simple question to some of ZH-ers:
"Which branch of communist/socialist party Blankfein, Dimon, Corzine, Buffet and army of US "Job creators" for overseas Countries that is, belong to?
Nothing but the cricket sounds. And, I am not pro-communism/socialism or any ism for that matter.
We need to start calling a things and people for what they are.
Smart Monetas, now below my reply, is for 2 words - individual freedom. That would be the world of honest competing producers and service providers, I gather, and I have no problem with that. What to do with army of "Good for nothings" with high financial/lifestyle aspirations? Are they free in their quest for much more elbow space?
Glory days of American Capitalism (post 2nd War era, until 70's) are over. That was unique time in history, where all stars were aligned in favor of luckiest generation in the history of the World, never to be repeated again.
It is 7 bil of us, at list half of that, inspired through much more connected world, dream of obtaining "American life style" which Dick C.
reserved only for us. Rock is getting dryer and dryer to squeeze an oil from, oceans are turning to jelly since 7 bil of us are throwing garbage left and right, air and water problems are looming...
Earth resembles stranded XVI Century ship where some of the crew think that only if they can come up with some great idea of catching the fish or some wayward seagull they can make a killing of fellow shipmates.
http://m.youtube.com/watch?v=YfXoK68YXFc
Portugal is not Greece .... is that a Brazil .... in your pocket .... or are you just happy to see me !
“obsession with austerity”.
~ AKA as living within ones means! But to any gubmint lackey those are fighting words!
That was the take away line ! LOL
Nigeria Iraq Ghana Greece Eritrea Rwanda .... Uganda Portugal !
EU members are "DUMB-ASSES!" Let's go over this one more time: We hate the Rothschilds and we Love Iceland!
I cried when I saw that 1935 movie about the Rothschilds .... they gave us modern, international banking .... by carrier pigeon .... now they use computers ? WTF
Everybody in EU tops are responsible. German authorities for being stuipid and not finish the EU laws including plan B and possibility of leaving as well as some sort of economic damage isolation between countries, and south for living above means and keeping same shitty corrupted system instead of forcing to change it. Laws as designed were counting on each country being responsible so that this never happen, instead of taking worse case scenario - how stupid. With biggest mistake at the first day Greece came begging for help, retarded Merkel did not foresee nor calculated anything of probability and took the biggest misstep ever in history of politics - bailout instead of immediate damage isolation and protecion for rest of the countries. Serves them well now, both north and south.
Even so though, EU is still way better than US, both economically and politically but then again... anything is better than US, maybe even North Korea.
The world would be much better without these Leeching bankster technocrats.
Exactly, mankind is literally stuck in the mud spinning it's wheels. Only divine intervention is going to get us out of fiat money slavery.
Other countries have to be looking at Greece, realizing that Cyprus was the first of a series of planned events, and doing the math to guess who is going to be next. Don't blame a Portuguese if he doesn't like their chances if this game plays out as-is.
And if this does move on, presumably to Portugal - who's next? Ireland, Spain... Italy? How far off would France's turn be then? For this demented game of "hot potato" made of superglue which adheres directly to your balls and obliterates your economic viability then shows up intact in the next guy's lap for the next round? And even if it's not your turn yet, if the last guy's implosion causes a chain reaction in a highly unstable system that no one fully understands, you're a goner anyway?
Portugal? Yawn. Is that that little shithole on the side of Spain?
They'll take Troika cock up their ass and like it, as long as it doesn't interfere with their siestas and their manlove of C. Ronaldo they won't care....
I thnk its the Jews who have a man love for Ronaldo. After all they are the ones who control the media. If you are like me you are sick of this fascination with this guy but lets face it when these homo Jews get fixated on someone they feel the need to force it on everyone. Beyonce, Obama, Hillary and even Conchita come to mind here; even if Ronaldo didn't exist the Jews would find another man to love.
Why do I get the feeling that no matter what Portugal, Greece, Germany, Spain, Italy, Ireland etc. does that this little game of international bankster roulette won't be satisfied. Remember that these banksters did exactly the same thing to us here in the states when Nixon was in power. They want something from the Europeans but as banksters always do they use a countries or contininent's financial situation in order to get it.
Europe screwed up by taking marching orders from the banksters during the Ukraine crises. Had they asserted their own will and used diplomacy then they could have joined the BRICs nations. Make no mistake about it Europe and even the United States itself needs to stand up to this bankster cabal which is nothing more than a Ponzi racket. If we don't then they are going to ruin us all.
There was somebody in Germany who once understood the situation but all the other fools from around the world incudling Europe thought that they could make a deal with the international banksters. Had this man not been forecefully removed from power he would have broken the banksters yoke. He understood them better than anyone else in the world.
These banksters aren't even economists nor are they professionals of any kind. They run their business on ponzi rackets, fear and even war for anyone who doesn't comply with theier demands. What I don't understand is why the govenrments from around the world don't get "Fed" up with all of this bullshit and kick them all out of their country.
They are our Federal Goverment, ever since the incorporated it in 1871.