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Austerity, Social Unrest, And Europe's 'Lose-Lose' Proposition

Tyler Durden's picture


The link between government spending cuts and social unrest is highly non-linear and extremely troublesome. We first noted the must-read quantification of the relationship between so-called CHAOS of social unrest and spending cuts back in early January and this brief lecture reiterates some of the frightening conclusions. Critically, small spending cuts impact social unrest in very marginal ways but once the cuts begin to rise to 2-3% of GDP then the probability of considerable and painful social unrest becomes much higher. As Hans-Joachim Voth points out in this INET lecture, analogizing between a burning cigarette as a catalyst for a forest fire in an arid landscape, he suggests the rapid build up of combustible material caused by austerity (youth unemployment in Spain perhaps?) could be inflamed by a seemingly small catalyst that would otherwise be ignored in general (a poor immigrant being shot or motorist murdered in a bad part of town) when spending cuts are at the extremes we see across Europe currently. The frightening reality of the non-economic, real social costs of the Troika's handiwork look set to be tested going forward as the link between periods of very heavy unrest (clusters of rioting for instance) and austerity is very strong. His findings on the post-chaos fiscal policies, (what does the government do once social unrest explodes) are perhaps more worrisome in that governments will immediately withdraw from austerity patterns which leads to some tough game-theoretical perspectives on the endgame in Europe in a 'lose-lose proposition' for austerity as the uncertainty shock of these events cause dramatic drops in Industrial Production.



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Fri, 04/13/2012 - 14:21 | 2342375 battle axe
battle axe's picture

French Revolution updated to today, but  it encompasses all of the EU. Dust off the Guillotine, sharpen that blade.

Fri, 04/13/2012 - 14:59 | 2342477 bank guy in Brussels
bank guy in Brussels's picture

The guillotine was a humane invention, actually ... the French Revolution gave every person condemned to die the nearly instant, aristocrat's death of beheading ... whereas the Anglo countries, America and the world, did the reverse, all executions became slow death and usually by torture, strangling people at the end of a rope, where it can take up to an hour to die.

(Hanging is slow death even where the neck breaks from the modern rope drop, putting the person mercifully into a coma ... but that is not reliable, many still slowly strangle ... and the USA still hanged two people in the 1990s, Japan still hangs people, and much of the world still uses this British Empire torture death.)

We Europeans are really horrified at the death penalty. But if one is going to have it, there are really only two humane ways, either beheading, or bullets, either from a several person firing squad, backed up by a handgun for the coup de grace, or one bullet in the back of the head - like the guillotine, very messy but humane and reliable.

Lethal injection is clearly often a half-hour of mental torture and getting jabbed repeatedly with a needle to find the 'right spot'. When a man in the US - in Utah I think - had the choice of legal injection or the firing squad, he chose the firing squad.

The guillotine is a mess to onlookers, but it was much better than most all the other execution techniques. America's many methods have all gone horribly, tormentingly, torturingly wrong.

Guillotine or bullets, should be the only choices for those societies who simply can't get beyond the death penalty.

Fri, 04/13/2012 - 15:20 | 2342528 jumbo maverick
jumbo maverick's picture

i know a guy that shot himself in the head with a 9mm blew his eyeball right out. the bullet went out the top of his head. he lived as soon as he pulled the trigger he wished he had not. said it hurt like hell. saw a guy once shoot himself in the head with a .25. he lived for several minutes afterward. each time you thought it was his last breath and he was done he would take another deep breath fighting to iive. also saw a guy once had shot himself with a glock .40 caliber. looked like a missle shot thru the top of his head. you could look right down inside his head. so the moral of the story is don't just use a bullet for the coup de grace-use the right bullet.

Fri, 04/13/2012 - 16:25 | 2342688 DeltaDawn
DeltaDawn's picture

You hang with a rough crowd!

Fri, 04/13/2012 - 18:14 | 2342854 AldousHuxley
AldousHuxley's picture

hanging is more effective:


Actor David Carradine killed himself in Thailand from auto erotic asphyxia where he had ropes around his wrists, neck and genitals.




Fri, 04/13/2012 - 21:25 | 2343126 Buck Johnson
Buck Johnson's picture

I remember that, David Carradine was into erotic asphyxia.

Fri, 04/13/2012 - 16:25 | 2342689 schatzi
schatzi's picture

Reminds me of the experience my mom had with her neighbours. An elderly couple got attacked by robbers in their house. One chap used a hammer to bash the the old guy and consequently broke his skull so badly, that the socket failed to hold the eyeball and therefore fell out. As the alarm went off for some time, my mother went over to the neighbours, entered the house called the police and ambulance and after having put the eye-ball back into the socket, had to hold it there until the ambulance arrived. He sadly died of his wounds. Happened in Cape Town two years ago.

Fri, 04/13/2012 - 17:25 | 2342777 Calmyourself
Calmyourself's picture

Lots of that happening in SA... Wonder why, should be a multiculti paradise by now...

Fri, 04/13/2012 - 18:21 | 2342872 AldousHuxley
AldousHuxley's picture

It is called revenge after apartheid.


As soon as government reversed policies white ignorant farmers and government workers sank to the bottom of the social and economical ladder. Of course, smart folks left town to US, Canada, or Australia.


Watch out in US....plenty of dumbass farmers and government workers (Tea party hypocrites) living the life in front of illegal alien garden slaves, farming slaves, blacks, etc.


Forget liberal art majors complaining about jobs......Imagine Occupy Wall Street with actual working poor minorities who just had it with white queens like Ann Romney who never worked in her life (and barely graduated from college)

Fri, 04/13/2012 - 22:10 | 2343159 LowProfile
LowProfile's picture


Watch out in US....plenty of dumbass farmers and government workers (Tea party hypocrites) living the life in front of illegal alien garden slaves, farming slaves, blacks, etc.

Clearly, you don't know any US farmers, or you wouldn't dream of libeling them like that.

Not just because any one of them could easily kick your candy ass, but because they are some of the smartest guys you'll meet.

Sat, 04/14/2012 - 10:58 | 2345272 SeattleBruce
SeattleBruce's picture

"working poor minorities" "white queens" - you sound like Al Sharpton.  What's with the race baiting?  There's plenty of hard working folks of all races, and plenty, of all races that don't work much (along various stages of the economic ladder.)  Sure the power structure is still disporportionately caucasian (whatever that means these days).  But there are more and more people of ANY color that are willing to serve at the highest echelons of the status quo and for TPTB.  So, what in the world is your point?  Don't you think it's time for the rest of us to stick together against TPTB that are messing up this world for their own greedy sakes?

Tue, 05/15/2012 - 10:59 | 2427027 entropos
entropos's picture

I want to take you behind a middle school and make you pregnant. 

Sat, 04/14/2012 - 00:52 | 2343303 10mm
10mm's picture

Anyone who preys on the elderley and kids should fuckin evaporate on the spot.

Sat, 04/14/2012 - 00:50 | 2343301 10mm
10mm's picture

Maybe a shotgun?

Sat, 04/14/2012 - 09:45 | 2345211 Troy Ounce
Troy Ounce's picture


End of story if you bite the gun.


Well, bite on the right place, that is.

Fri, 04/13/2012 - 15:31 | 2342553 mikesswimn
mikesswimn's picture

The most recent hanging in the US was Billey Baily in 1996 who CHOSE that particular method of execution among others.  In fact, in the 34 states with the death penalty, 16 offer secondary methods of execution beyond leathal injection (all have lethal injection), generally available as a choice for the condemned.

We Americans are really horrified at a lack of choice.

Oh, also, you sound like you're a smug douchebag.

Fri, 04/13/2012 - 15:37 | 2342574 AnAnonymous
AnAnonymous's picture

The animals are out!

Bring back the rope, bring back the electric chair.

Randy Gray, official support to Ron Paul, money bomb inventor.

Fri, 04/13/2012 - 15:49 | 2342602 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

The animals are out!

Bring back the rope, bring back the electric chair.

It also can not blame Chinese citizenism, we all know this is a land of block no tomorrow. Therefore, when the collapse of the very impressive Chinese citizenism economy, you understood why banks are empty shells at the same time and ugly bestiality on its head, but also a loss for words to face the many deserted the once mighty booming company of Peoples Liberation Opium Parlor franchises.

But hey, it is self intoxicating.


Fri, 04/13/2012 - 17:46 | 2342809 ATM
ATM's picture

Brilliant! +100

Fri, 04/13/2012 - 16:14 | 2342668 navy62802
navy62802's picture

I wouldn't mind seeing some of our evil bankers drawn and quartered on Times Square.

Fri, 04/13/2012 - 17:14 | 2342765 Things that go bump
Things that go bump's picture

Hangings used to be a sort of spectator sport. People brought their families and packed a lunch. The condemned didn't get enough drop to break their neck, and if they didn't have a friend or family member to pull on their legs and give them a quick and merciful exit, they kicked and struggled and choked.  A skilled executioner was something of a showman and could keep a hanging going for a long time. Low born traitors were drawn and quartered. They were hanged for a while and taken down alive and a hook was introducted into their abdomen.  Their intestines were drawn out through their bellies. When they finally died, their bodies were sectioned into quarters and sent to be viewed throughout the kingdom as a warning to others.  High born traitors got the axe.          

Sat, 04/14/2012 - 11:01 | 2345276 SeattleBruce
SeattleBruce's picture

"Low born traitors were drawn and quartered."

Imagine if you were wrongfully convicted, or set up, and suffered this fate simply because you didn't have enough wealth and connections?  Those were rough times...

Fri, 04/13/2012 - 18:10 | 2342849 Schmuck Raker
Schmuck Raker's picture

I like the way China administers capital punishment.

They just leave you in the middle of the road, and run you over with a truck a couple times.

Fri, 04/13/2012 - 21:17 | 2343120 Koffieshop
Koffieshop's picture

"Guillotine or bullets, should be the only choices for those societies who simply can't get beyond the death penalty."


What about dropping people to death? If I were to be executed, I'd prefer being dropped from really really high onto concrete.


It's instant, painless and relyable.

Mon, 06/18/2012 - 11:28 | 2536309 Zaydac
Zaydac's picture

The drop would not be instant. It would seem very long while you were doing it. A bit like the whale in Hitchiker. Or watching Greece decompose. History will say it happened quickly. It doesn't seem quick to those who are there at the time. The time something seems to take is entirely dependent on the circumstances of the observer.

Fri, 04/13/2012 - 14:23 | 2342377 Ahmeexnal
Ahmeexnal's picture

so much for  Bismarck's pipedreams of a pan-european welfare state. back to square one: the pan-european feudal state.

Fri, 04/13/2012 - 14:49 | 2342449 Buzzworthy
Buzzworthy's picture

Bismarck implemented welfare measures as a way of reducing the influence of the SDP, not because he believed in them.  The landed and industrial elites in late 19th century Germany were under siege and faced what they thought was the very real threat of social upheval (i.e. a la the French Revolution).  Bismarck therefore instituted a policy of Realpolitik that relied on concessions in social welfare in order to diffuse political support for leftist political parties.  The "welfare state" was a defensive measure intended to maintain the power of the status quo, not a policy intended to push a leftist agenda.

Fri, 04/13/2012 - 14:57 | 2342472 Seize Mars
Seize Mars's picture


I understand what you're saying but it seems like some sort of tautology. Ok, the welfare state wasn't a policy intended to push a leftist agenda, but what it did was push a leftist agenda.

Fri, 04/13/2012 - 15:06 | 2342491 bank guy in Brussels
bank guy in Brussels's picture

Indeed, for whatever the motive, many, perhaps even the majority of wealthier people here in Continental Europe, are what US people would call 'socialists' ...

There is just a broad feeling here that it works, it is better, it creates much social peace and reduces tension.

With the result that rich people in Brussels can pump petrol into their Ferraris and pop in to get a bag of crisps and a 'tall boy' beer, and not get hassled.

Almost no one here wants to 'end the welfare state' - the discussion is how to adjust it, make it fair and sustainable, while keeping lazy people from exploiting it.

Americans are so gone in the other direction - radical Americans tend to the libertarian side - it is almost as if Americans and Europeans cannot really have a conversation.

Fri, 04/13/2012 - 16:00 | 2342636 falak pema
falak pema's picture

they can about jazz but thats it.

Sat, 04/14/2012 - 01:23 | 2343319 TBT or not TBT
TBT or not TBT's picture

In any case it was about power.   Statism in both cases, meant to elevate an elite, only ostensibly for social justice etc.

Fri, 04/13/2012 - 16:04 | 2342647 Gunther
Gunther's picture

For Bismarck Germany was settled in the pre-1914 borders. He did not even want to include Austria.
Make blue-collar workers save for their old age was quite different from today's welfare state. Keep in mind that at the time Germany had a gold standard.

Fri, 04/13/2012 - 14:23 | 2342384 Sudden Debt
Sudden Debt's picture

It's friday, just people having some fun... Molotov anyone?

Fri, 04/13/2012 - 14:51 | 2342452 trilliontroll
trilliontroll's picture


(I hope no one gets the reall meaning...)

Fri, 04/13/2012 - 14:24 | 2342385 GeneMarchbanks
GeneMarchbanks's picture
President Obama says the US is "on track" to its goal of doubling exports

Now that is comedy.

Fri, 04/13/2012 - 14:27 | 2342396 Unprepared
Unprepared's picture

... of USD inflation, unquote

Fri, 04/13/2012 - 20:45 | 2343079 Ahmeexnal
Ahmeexnal's picture

the US will double it's exports of  "freedom and democracy"?

Hmmm...that means Syria and iRan are not the only ones on the list.

Fri, 04/13/2012 - 14:44 | 2342439 SheepDog-One
SheepDog-One's picture

Double the exporting of what? Debt?

Fri, 04/13/2012 - 15:19 | 2342522 TheFourthStooge-ing
TheFourthStooge-ing's picture


Double the exporting of what? Debt?

Yes, that and fraud.


Fri, 04/13/2012 - 16:14 | 2342671 Tom Servo
Tom Servo's picture

Figured he meant "empty shipping containers" as our leading export.

Fri, 04/13/2012 - 17:49 | 2342814 ATM
ATM's picture

It's going to be oil, coal and natural gas. All the filthy wealth creating cheap energy. That's what the US is going to export.... oh and paper too, trillions and quadrillions and quintillions of worthless paper.. 

Fri, 04/13/2012 - 14:44 | 2342440 Sudden Debt
Sudden Debt's picture

Sure he didn't say "on track to doubling the deficits"?

Fri, 04/13/2012 - 17:00 | 2342742 Tenshin Headache
Tenshin Headache's picture

Perhaps he meant in nominal terms.

Fri, 04/13/2012 - 14:24 | 2342387 moskov
moskov's picture

I don't believe Europe can maintain social order and stability at all.

They are in fact literally worse than Russia and China during the cold war times.


They would have their Tanks rolling on their streets very soon

Fri, 04/13/2012 - 14:30 | 2342407 GeneMarchbanks
GeneMarchbanks's picture

All the 'Tanks' are in Syria just FWI. You're confused, read more hyperbole less, eventually you'll get it.

Fri, 04/13/2012 - 14:44 | 2342438 seamus3500
seamus3500's picture

didn't greece just get a fresh shipment of a 1000 tanks?

Fri, 04/13/2012 - 15:17 | 2342505 JOYFUL
JOYFUL's picture

...All the 'Tanks' are in Syria just FWI. You're confused, read more hyperbole less, eventually you'll get it...

in spirit of which advice, here are some of the developments ZH readers are missing, as we round out another week of self imposed (?!??!-clarification invited!!!) blackout of stories from that fringe area of the globe simmering on the verge of regional tensions going nuclear...

...oh for the days when only one url was needed to keep up on important world events!

Fri, 04/13/2012 - 14:25 | 2342388 Hondo
Hondo's picture

Hyper inflation will have the same tail effect......and there is very little room in the middle

Fri, 04/13/2012 - 14:27 | 2342394 lizzy36
lizzy36's picture

It will be interesting to see what post election France brings.

There is no way with youth unemployment in many areas of Europe between 25%-50% that social stability stands a chance.

Fri, 04/13/2012 - 14:30 | 2342409 Ahmeexnal
Ahmeexnal's picture

Legalize soma. Problem solved.

Sat, 04/14/2012 - 01:25 | 2343321 TBT or not TBT
TBT or not TBT's picture

Protectionism with a nationalist spin to it, is what post election France will bring.

Sat, 04/14/2012 - 13:04 | 2345405 TBT or not TBT
TBT or not TBT's picture

Except that, the problem for Europe, the existential threat, is not enough young people.   Don't know how much riot they can make.    25% of not much is not much.

Fri, 04/13/2012 - 14:28 | 2342400 AnAnonymous
AnAnonymous's picture

Bring them on!

Fri, 04/13/2012 - 14:28 | 2342403 Sudden Debt
Sudden Debt's picture

I'm all for 99% cuts.

Fri, 04/13/2012 - 14:43 | 2342413 Bam_Man
Bam_Man's picture

The "Bread and Circuses" will continue as long as the printing press remains in the hands of the Government (or its Central Bank fiscal agent).

The problem in Europe is that Germany has effectively taken away the printing press. In the US, Japan, UK and elsewhere, the printing has only just begun. We/they will continue to print in larger and larger quantities until total currency destruction is achieved. All that will take is one or more major oil-producing state(s) refusing to accept payment in government fiat. That is called instant global hyperinflation. My estimate is that we don't get there until 2015-16. Then all hell breaks loose. As in "total economic and societal collapse combined with some sort of drug-resistant pandemic".

Fri, 04/13/2012 - 15:11 | 2342502 bank guy in Brussels
bank guy in Brussels's picture

Europe will print big-time as soon as they are pushed hard enough, Germany kicking and screaming but still agreeing.

Europe is not pro-actively printing, that is true, the Germans are still holding on to their own fantasies ... but as was wonderfully pointed out in a ZeroHedge article the other week, there is only one real choice, given that the Germans and northern Europeans need to hide the fact that everybody's pension money is invested in the bonds of Spain and Italy.

Print and inflate. - Which the ECB and Germany will do, when they are pushed hard enough.

'The Ugly Truth for Northern Europeans' -

Fri, 04/13/2012 - 15:42 | 2342590 Bam_Man
Bam_Man's picture

Oh yes, the ECB will print like mad, but won't need Germany's permission because Germany will have already bailed out of the Eurozone by then.

Once a country the size of Spain is faced with the prospect of having to leave the Euro, the ECB (and by definition the Euro) is finished anyway. At that point the Germans will pull the plug and leave. Then the ECB will be free to monetize the entire sovereign bond markets of Spain, Portugal, Italy and Greece which they will have to do. I don't think the Germans want to stick around for the hyperinflation that the Eurozone will experience at that point.

Fri, 04/13/2012 - 20:54 | 2343094 Ahmeexnal
Ahmeexnal's picture

I don't think the Germans want to stick around for the hyperinflation that the Eurozone will experience at that point.

They have no other choice. Even if they manage to ejaculate themselves from the euro, the hyperinflated euro and the millions of disgruntled and raped PIIGS citizens will pour into Germany seeking revenge. German industry will collapse, as it's neighbors collapse into civil war and will be more preocupied with securing their next meal (which will most likely consist of fried rat or a fried neighbor) than buying the latest and greatest shit from BMW, Porsche, Hugo Boss, etc.

Understand this: pan european war will be the result of monetary collapse. That was the plan all along. To redraw the borders...into one feudal superstate.

Sat, 04/14/2012 - 15:47 | 2345573 CTG_Sweden
CTG_Sweden's picture








"Oh yes, the ECB will print like mad, but won't need Germany's permission because Germany will have already bailed out of the Eurozone by then.


Once a country the size of Spain is faced with the prospect of having to leave the Euro, the ECB (and by definition the Euro) is finished anyway. At that point the Germans will pull the plug and leave. Then the ECB will be free to monetize the entire sovereign bond markets of Spain, Portugal, Italy and Greece which they will have to do. I don't think the Germans want to stick around for the hyperinflation that the Eurozone will experience at that point."




My comments:


I think that Germany should already have left the eurozone and should have let the remaining countries order ECB to print money and lend it to member countries at a 2 % interest rate. That would have solved the problem, at least for a while.


I don´t think that the Germans would have to suffer from too much appreciation of a reintroduced D-mark. If they print enough too, the D-mark wouldn´t have to appreciate too much. Why not print money, lend it to a German pension fund controlled by the government which buys forest land, mines etc abroad?


The reason why I doubt that Germany will leave the eurozone is that European politicians want a more closely integrated Europe for ideological reasons. My impression is that they are willing to let their electorate pay a very high price for their ideological ideas. That happened in Sweden in the early 1990s when Swedish politicians wanted people to say yes to EU membership. For that reason they created economic chaos in order to be able to say to people that "we need EU membership in order to save the economy". So they pegged the Swedish krona to the ecu (the forerunner to the euro) and tried to defend the exchange rate with a 500 % interest rate. The cost for doing that has been estimated to almost $80 billion. In a country with 300 million people, like the US, rather than 9 million people that equals about $2500 billion.


If there will be an economic collapse, I don´t think that the general public will blame mainstream politicians. They did not do that in Sweden. I think that the politicians will blame the market and speculators and that the electorate will buy that. Even conservative and liberal-conservative politicians which usually are close friends of the big banks and big business will probably do that. Our conservative prime minister Carl Bildt did that (this clown is now our minister of foreign affairs). And the electorate bought his explanation.


Fri, 04/13/2012 - 17:05 | 2342753 Sandmann
Sandmann's picture

The problem in Europe is that Germany has effectively taken away the printing press.

How is that ? They have refused to backstop Draghi have they ? If Obama and Sarkozy tell Merkel to dance she does.

Fri, 04/13/2012 - 14:32 | 2342416 Vince Clortho
Vince Clortho's picture

Nobody knows what the trigger event will be, but I think the point he makes is right on the money.

Fri, 04/13/2012 - 14:31 | 2342417 Joebloinvestor
Joebloinvestor's picture

I hope they get to see a list of who stays on "top" and who doesn't.

The politicians and bankers will survive and better then the rest.

I don't see any "austerity" in government 5 star hotels or dinners.

Fri, 04/13/2012 - 14:35 | 2342418 Hannibal
Hannibal's picture


Viva Iceland! 13 Apr

Iceland fell into bankruptcy a few years ago.  The IMF tried to impose draconian controls over Iceland’s government and economy in return for providing a bail-out.  The people of Iceland told their government and the international bankers to stick it.

Iceland went through a difficult year or two, but their economy is now restored and reportedly growing at 2.9% per year–one of the strongest growth rates on the globe....

Fri, 04/13/2012 - 14:33 | 2342419 GOSPLAN HERO
GOSPLAN HERO's picture

Murphy's Rules of Combat
Murphy's Laws of Combat
(A comprehensive list obtained from various sources)

If the enemy is in range, so are you.
If you can see the enemy, they can see you.
Incoming fire has the right of way.
Friendly fire isn't.
The only thing more accurate than incoming enemy fire is incoming friendly fire.
Don't look conspicuous: it draws fire. This is why aircraft carriers are called bomb magnets.
There is always a way.
The easy way is always mined.
Try to look unimportant, they may be low on ammo.
Professionals are predictable, it's the amateurs that are dangerous.
The enemy only attacks on one of two occasions: When you're ready for them, and when you're not ready for them.
Teamwork is essential; it gives the enemy someone else to shoot at.
If you can't remember, the claymore is pointed at you.
If your attack is going well, you have walked into an ambush.
The enemy diversion you have been ignoring will be the main attack.
Don't draw fire, it irritates the people around you.
When the pin is pulled, Mr. Grenade is not our friend.
If it's stupid but works, then it isn't stupid.
When in doubt empty the magazine.
Never share a fox hole with anyone braver than you.
Anything you do can get you shot. Including doing nothing.
Make it too tough for the enemy to get in and you can't get out.
Mines are equal opportunity weapons.
A Purple Heart just proves that were you smart enough to think of a plan, stupid enough to try it, and lucky enough to survive.
Don't ever be the first, don't ever be the last and don't ever volunteer to do anything.
The quartermaster has only two sizes: too large and too small.
Five second fuses only last three seconds.
It is generally inadvisable to eject directly over the area you just bombed.
A "sucking chest wound" is nature's way of telling you to slow down.
If you're short of everything but the enemy, you're in a combat zone.
When you have secured an area, don't forget to tell the enemy.
Never forget that your weapon is made by the lowest bidder.
You are not a superman.
No plan survives the first contact intact.
If you are forward of your position the artillery will always fall short.
The important things are always simple.
The simple things are always hard.
No combat ready unit ever passed inspection.
Beer math: two beers times 37 men equal 49 cases.
Body count math: two guerillas plus one portable plus two pigs equals 37 enemy KIA.
Things that must be together to work usually can't be shipped together.
Radios will fail as soon as you desperately need fire support.
Tracers work both ways.
If you take more than your fair share of objectives, you will have more than your fair share of objectives to take.
When both sides are convinced that they are about to lose, they are both right.
If it moves, shoot it.
If it doesn't move, poke it with your gun barrel and then shoot it.
Overkill works.
Murphy was a grunt.

Fri, 04/13/2012 - 14:36 | 2342423 cherry picker
cherry picker's picture

Rodney King and the 1992 LA riots are an example of the above article. 

It can, did and will happen again.

Fri, 04/13/2012 - 14:42 | 2342433 AnAnonymous
AnAnonymous's picture

Yah, yeah.

Bring them on.

Fri, 04/13/2012 - 15:24 | 2342534 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

Yah, yeah.

Bring them on.

Oh, that's right, it's the weekend again. As usual, it looks like AnAnonymous will be spending it at the wifi hotspot of his neighborhood PLOP (Peoples Liberation Opium Parlor).


Fri, 04/13/2012 - 14:41 | 2342429 Westcoastliberal
Westcoastliberal's picture

To summarize, this plan ain't gonna work.  The people won't go for it.

Fri, 04/13/2012 - 14:42 | 2342434 Kreditanstalt
Kreditanstalt's picture

It's all irrelevant anyway.

If they don't implement cuts in government spending, inflation will explode and the currency will crash.  If they do they get a recession and unemployment.  There's NO GOLDILOCKS.


Fri, 04/13/2012 - 14:43 | 2342437 dcb
dcb's picture

unless that is their desire. cause social unrest, declare marshall law, suspend democracy. keeps the elites in power!!!

Fri, 04/13/2012 - 14:45 | 2342441 sangell
sangell's picture

Typical leftist BS. Use Latin America and Euro countries with big communist parties to PROVE it is better to raise taxes than to cut spending.

Fri, 04/13/2012 - 14:44 | 2342442 apberusdisvet
apberusdisvet's picture

The agenda is fairly obvious; make things so bad that the Eurosheeple will beg for another Hitler, certainly another reichmark, and a state guarantee of 3 hots and a cot.  If that sounds like your average prison, you are right.

Fri, 04/13/2012 - 15:20 | 2342525 surf0766
surf0766's picture

bottom up, top down, inside out?

Fri, 04/13/2012 - 14:45 | 2342443 Jason T
Jason T's picture

wealth is very very quickly moving from the west to the east.  like lightning it will strike.

Fri, 04/13/2012 - 14:45 | 2342444 fadgadget
fadgadget's picture

piven and cloward were not joking.

Fri, 04/13/2012 - 15:24 | 2342535 surf0766
surf0766's picture

She is just an old lady making cookies...

Fri, 04/13/2012 - 14:51 | 2342453 SwingForce
SwingForce's picture

In the immortal words of Kyle Bass, "How does that work?"

Fri, 04/13/2012 - 14:52 | 2342456 Buzzworthy
Buzzworthy's picture

Revenue generation to stave off social unrest = raising taxes which breeds social unrest.  There is no way out of this situation that does not involve weapons, canned goods, and a bullet proof vest.

Fri, 04/13/2012 - 14:54 | 2342466 ElvisDog
ElvisDog's picture

But if a country can't pay for its social welfare out of tax receipts, if it has a chronic structural deficit, THERE IS NO ALTERNATIVE TO AUSTERITY. All these policy wonk retards seem to think that austerity is just a matter of attitude. When you can't pay the bills, at some point you have to cut spending. Even if you try everything you can to avoid austerity there will come a point when it will come knocking on your door.

Fri, 04/13/2012 - 17:03 | 2342749 Sandmann
Sandmann's picture

AUSTERITY means HIGHER TAXES as in Britain and increased Benefits.....Cameron increases taxes on those who WORK and increases Welfare by 5.2% so those who do NOT Work are protected from Inflation. They increase airline taxes to the highest on the planet, train fares, postage rates +38% on 30 April, increase Sales Tax to 20%, increase petrol taxes - so we get a Government spending and borrowing MORE and increasing the National Debt by 50% in next 3 years. OH and cut taxes on bankers from 50% to 45%.

That is how it works in Europe - simply increase TAXES on those who work and that is why "Austerity" causes riots. Because the rich don't pay taxes and the poor get protected and the middle gets CRUSHED

Fri, 04/13/2012 - 17:18 | 2342770 Westcoastliberal
Westcoastliberal's picture

Yes there IS an answer to all this and the kings of old knew its name...JUBILEE!  Fuck the rich.

Fri, 04/13/2012 - 14:58 | 2342474 chistletoe
chistletoe's picture

so revolution is coming to europe?


thank goodness China is okay ....

Fri, 04/13/2012 - 15:07 | 2342493 Dapper Dan
Dapper Dan's picture

After watching the video I have a better understanding of why the DHS ordered all that ammo.

Fri, 04/13/2012 - 16:49 | 2342729 Tenshin Headache
Tenshin Headache's picture

Actually, I think they intend to let it fall into the hands of Mexican drug gangs, so that they can track it and arrest the bad guys. Or something like that.

Fri, 04/13/2012 - 15:08 | 2342497 sschu
sschu's picture

It seems his is an interesting thesis, at what point does it become politically unpalatable to cut budgets, primarily due to the potential social unrest and the fact that this unrest will cause those in power to lose the next election. 

It therefore is better for those in power to use a different method.  Basically you must continue to grow spending, but not on a real basis, you essentially inflate or devalue the currency.  Using this approach you control the calculation of inflation, so while it may be 7-8%, you tell everyone that it is really 2% and well within our established “targets”.  There is just too much (potential) political power in demonizing your opponent for cutting spending. 

Sounds a lot like the American approach.  The idea that there will be any reduction in government spending is laughable, but if you factor inflation into the calculation, then the picture is/may be different. 

Of course the fact that the economy is severely distorted, grandma’s pension gets wrecked, everyone’s taxes go up due to bracket creep and wages do not keep pace with inflation (lower standard of living) is just an unfortunate result of clearly the best policy approach for all … or at least those who are first in line when the free money gets handed out.


Fri, 04/13/2012 - 15:39 | 2342576 ElvisDog
ElvisDog's picture

I think that is exactly the approach being taken by Bernanke, et al. The problem is that there are some things like food and gasoline which will register the creeping inflation and can't be hidden from the masses.

Sat, 04/14/2012 - 09:20 | 2345179 chubbar
chubbar's picture

Don't forget the other half of the equation. Using a complicated assortment of derivatives, swaps and selling to contain the prices of precious metals and other commodities in an attempt to hide the inflation (maintain the validity of the currency) as well as confuse those trying to retain the purchasing power of savings.

Fri, 04/13/2012 - 15:11 | 2342501 Arnold Ziffel
Arnold Ziffel's picture

Keep your head down and keep one will notice....

Fri, 04/13/2012 - 15:35 | 2342563 SmoothCoolSmoke
SmoothCoolSmoke's picture

WHA?!  Europe's not fixed?  Yer shit'n me.

Fri, 04/13/2012 - 16:04 | 2342644 falak pema
falak pema's picture

euro-usa-nippo hippo not fixed..? that fixed the trilateral thingie that is the genie in the oligarchy bottle...fixed the focus on the core problem. Now for the solution. 

Fri, 04/13/2012 - 15:52 | 2342605 q99x2
q99x2's picture

How about this: Arrest the bankster family gang members. Redistribute their wealth into a bidcoin type of open source monetary system, make the establishment of law a function of referendum, and try treasonous politicians for treason.

Problem solved and a happy, safe future for humnakind.

Otherwise continue listening to those filled by hubris and those that offer only solutions based within a history of failure.

I mean I liked what the guy had to say but people said the same during Argentina's crisis. It is nothing new although the retarded inbred elite class of vermin need to hear it over and over again and should at all times possible be handcuffed with a hood over their heads at their time of listening until they f'n get it.

Fri, 04/13/2012 - 15:59 | 2342632 falak pema
falak pema's picture

eurozone and US in perfect catch 22 position; what can central planning now pull out of the hat?!!


Fri, 04/13/2012 - 16:41 | 2342713 ReligiousAtheist1
ReligiousAtheist1's picture

All of Europe should go the way of Iceland tell the bankers where to put it

Fri, 04/13/2012 - 17:43 | 2342804 americanspirit
americanspirit's picture

If the feds would just announce an across-the-board "austerity" reduction 0f 15% in Social Security, Medicare, Medicaid, Workman's Comp, Food Stamps (sic), Veteran's, and Federal pension benefits, and simultaneously mandate 100% debt forgiveness on all credit cards, home equity loans, and student loans with no IRS liability they could transfer almost 100% of the 'austerity' suffering onto the poorest 30% of the people while getting a 95% approval rating from the rest of society. Then as the urban poor go berserk, the DHS could use all that ammo and drone technology to implement the final solution they have no doubt been planning - although given some other name like "The Keep American Cities Safe" plan, or maybe the "Start From Scratch New Neighborhoods Initiative". This would have the added advantage of inflaming a large proportion of the illegal immigrants now living off government benefits, making them easier targets for those Keeping Us Safe. In no time at all both the budget and the illegal immigrant and the bad-smelling poor people problems would all have been solved.

Fri, 04/13/2012 - 17:58 | 2342826 thursday0451
thursday0451's picture

This guy's conclusion does not follow.

He states 1) cutting spending makes people mad, 2) raising revenue via taxing more doesn't bother people.

He then concludes that we should raise taxes, not cut spending, in times of crisis. Well ... what if raising taxes doesn't actually raise revenue? If the economy is contracting, and everyone is unemployed, then your social expenditures to keep everyone on unemployment benefits are going up proportional to gdp, and your revenue with stable taxes is going absolutely. Even if you raise, even double taxes, the us govt has never successfully extracted more than about 20% of gdp. So even if you raises taxes, your revenue will still go down. People will avoid taxes, commit tax fraud, etc.

This guy is missing the point. The point is that you shouldn't ever get into a position where you would be in a catch 22. You can't cut expenditures as that will lower gdp and make people mad. You can't better the fiscal situation by raising taxes as your economy is shrinking, meaning your revenue is shrinking.

Fri, 04/13/2012 - 22:39 | 2343183 Davalicious
Davalicious's picture

What he is talking about is simply the psychological principle of loss. People feel much worse about getting something and then losing it, or having the threat of losing it, than never having it at all.

That is why it is bad policy to give out benefits which will later be withdrawn i.e. don't bring immigrants to a country, shower them with benefits, and then find you don't have the cash to pay them later. They will go wild.

Fri, 04/13/2012 - 23:25 | 2343202 Dre4dwolf
Dre4dwolf's picture

If the GOVT let the banks fail back in the crisis.... we would of had the best 5 years of growth in the history of the nation.


Whats better ?

Bailing out banks with 5 Trillion Dollars.... banks who will then use that money against the very people who should of been relieved of debt as COMPENSATION for the banks getting all this free money.




20,000,000 households with No Mortgage obligations to pay because their creditor went belly up?


20,000,000 households with FDIC insurance and 150 ~200,000$ in the bank to spend on home improvement.

20,000,000 households with real assets (land , property, cars, businesses) that could then use the money they saved from mortgage payments on hiring people to make improvements/new business ventures.


Or 5 Trillion given to a zombie bank that shouldnt even exist , which in turn is going to use that money to rape and pillage and cause mass economic unrest?



You want a real bailout plan?

WELL, either BAILOUT NO ONE, or BAILOUT HOUSEHOLDS.... you know... living breathing human beings who are now forced to pay exorbitant debts in and economic climate where its raining shit because of the mistakes and moral RAPAGE that these institutions you bailout continue to propagate yet take ZERO responsibility for... in fact they get REWARDED for taking UN-necessary risks that put peoples LIVES in danger.


Rip JP Morgan and Goldman up into tiny little pieces and sell the pieces off for pennies on the dollar.... watch economic growth sky rocket.

Sat, 04/14/2012 - 01:04 | 2343313 10mm
10mm's picture

Maybe President Romney will take that path./sarc

Sat, 04/14/2012 - 01:36 | 2343334 Sandmann
Sandmann's picture

Banks bought the Politicians and the stupid public thought they had more Votes - but  Banks buy votes on Committees not int the street. Wall Street knows which votes count and Voters are simply an Electoral College not really controlling Committee Votes and Committee Staffers

Sat, 04/14/2012 - 09:48 | 2345214 Arnold Ziffel
Arnold Ziffel's picture

Ireland RE plunges further:


While at the end of last month, new data from the Central Statistics Office revealed that residential property prices fell by almost 18 per cent in the year to February.

The property crash has resulted in more than 1,600 ghost estates across Ireland.

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