Slovakia On Why It Votes "No" To EFSF Expansion: "The Greatest Threat To The Euro Is The Bailout Fund Itself"
Yesterday we reported that tiny Slovakia's refusal to ratify the expansion of the EFSF 2.0 (even though a 4.0 version will be required this week after the "Dexia-event"), may throw the Eurozone into a tailspin as all 17 countries have to agree to agree to kick the can down the road: even one defector kills the entire Swiss Watch plan. Yet an interview conducted between German Spiegel and Slovakia party head Richard Sulik confirms that tiny does not mean irrelevant, and certainly not stupid. In fact, just the opposite: his words are precisely what the heads ot the bigger and far less credible countries should be saying. Alas they are not. Which is precisely why the euro is doomed.
From Spiegel:
Only two countries, Malta and Slovakia, have yet to ratify the expansion of the euro bailout fund. Its fate may be in the hands of a minor Slovak party headed by Richard Sulik. In an interview, the politician explains why he hopes the fund will fail and what he sees as the only way to save the euro.
SPIEGEL ONLINE: Mr. Sulik, do you want to go down in European Union history as the man who destroyed the euro?
Richard Sulik : No. Where did you get that idea?
SPIEGEL ONLINE: Slovakia has yet to approve the expansion of the euro backstop fund, the European Financial Stability Facility (EFSF), because your Freedom and Solidarity (SaS) party is blocking the reform. If a majority of Slovak parliamentarians don't support the EFSF expansion, it could ultimately mean the end of the common currency.
Sulik: The opposite is actually the case. The greatest threat to the euro is the bailout fund itself.
SPIEGEL ONLINE: How so?
Sulik: It's an attempt to use fresh debt to solve the debt crisis. That will never work. But, for me, the main issue is protecting the money of Slovak taxpayers. We're supposed to contribute the largest share of the bailout fund measured in terms of economic strength. That's unacceptable.
SPIEGEL ONLINE: That sounds almost nationalist. But, at the same time, you've had what might be considered an ideal European career. When you were 12, you came to Germany and attended school and university here. After the Cold War ended, you returned home to help build up your homeland. Do you care nothing about European solidarity?
Sulik: If we now choose to follow our own path, the solidarity of the others will also crumble. And that would be for the best. Once that happens, we would finally stop with all this debt nonsense. Continuously taking on more debts hurts the euro. Every country has to help itself. That's very easy; one just has to make it happen.
SPIEGEL ONLINE: Slovakia's parliament is scheduled to vote on the bailout fund expansion on Oct. 11. How do you predict the vote will turn out?
Sulik: It's still open. The ruling coalition is composed of four parties. My party will vote "no"; the other three coalition parties intend to say "yes." What the opposition says is decisive.
SPIEGEL ONLINE: The Social Democrats have offered your coalition partners to support the reform in return for new elections. Do you think the coalition is in danger of collapse?
Sulik: I don't see any reason why it would.
SPIEGEL ONLINE: What will you do should the EFSF reform pass despite your opposition?
Sulik: For Slovakia, it would be best not to join the bailout fund. Our membership in the euro zone, after all, was not conditional on us becoming members of strange associations like the EFSF, which damage the currency.
SPIEGEL ONLINE: If the euro only causes problems, why doesn't Slovakia's government just pull the country out of the euro zone?
Sulik: I don't see the euro as the problem. It's a good project. Everyone involved can benefit from it -- but only if they stick to the ground rules. And that's exactly what we're demanding.
SPIEGEL ONLINE: Which ground rules should we be following?
Sulik: We have to observe three points: First, we have to strictly adhere to the existing rules, such as not being liable for others' debts, just as it's spelled out in Article 125 of the Lisbon Treaty. Second, we have to let Greece go bankrupt and have the banks involved in the debt-restructuring. The creditors will have to relinquish 50 to perhaps 70 percent of their claims. So far, the agreements on that have been a joke. Third, we have to be adamant about cost-cutting and manage budgets in a responsible way.
SPIEGEL ONLINE: Many experts fear that a conflagration would break out across Europe should Greece go bankrupt and that the crisis will spill over into other countries, including Portugal, Spain and Italy.
Sulik: Politicians can't allow themselves to be pressured by the financial markets. Just because equity prices fall and the euro loses value against the dollar is no reason for giving in to panic.
SPIEGEL ONLINE: But do you really believe that politicians can calm the financial markets by stubbornly sticking to their principles?
Sulik: Let's just ignore the markets. It's ridiculous how politicians orient themselves based on whether stock prices rise or fall a few percentage points.
SPIEGEL ONLINE: You're not afraid that a Greek insolvency could mark the beginning of the crisis instead of the end?
Sulik: No. There's not going to be a domino effect along the lines of "first Greece, then Portugal and finally Italy." Just because one country goes broke doesn't mean the other ones automatically will.
SPIEGEL ONLINE: Nevertheless, banks could run into significant problems should they be forced to write down billions in sovereign bond holdings.
Sulik: So what? They took on too much risk. That one might go broke as a consequence of bad decisions is just part of the market economy. Of course, states have to protect the savings of their populations. But that's much cheaper than bailing banks out. And that, in turn, is much cheaper than bailing entire states out.
SPIEGEL ONLINE: Does one of your reasons for not wanting to help Greece have to do with the fact that Slovakia itself is one of the poorest countries in the EU?
Sulík: A few years back, we survived an economic crisis. With great effort and tough reforms, we put it behind us. Today, Slovakia has the lowest average salaries in the euro zone. How am I supposed to explain to people that they are going to have to pay a higher value-added tax (VAT) so that Greeks can get pensions three times as high as the ones in Slovakia?
SPIEGEL ONLINE: What can the Greeks learn from the reforms carried out in Slovakia?
Sulik: They have to make cuts in the state apparatus. The Slovaks could also give them a few good ideas about the tax system. We have a flat tax when it comes to income taxes. Our tax system is simple and clear.
SPIEGEL ONLINE: One last time: Do you honestly believe the euro has any future at all?
Sulík: I believe the euro has a future. But only if the rules are followed.
Interview conducted by Maria Marquart
(52 votes)
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http://www.321gold.com/mustread/100611_rant.html
"The greatest threat to the euro is the bailout fund itself."
Completely true, but don't expect the beaurocrats to believe it.
http://silverliberationarmy.blogspot.com/
what's mentioned below in my post, is meant as a mocking parody of der spiegel's interview of richard sulik. please see poe's law.
When you hear the truth told like in that article, it sure makes the half truths and ephemisms of the interviewer sound pathetic.
I, too, am glad to finally hear someone in Europe say this. But coming from Slovakia, it doesn't mean much. It's like the scrawny kid who decides to stick up for himself during recess ... then promptly gets the shit beat out of him.
Exactly. This means jackshit for now. Most likely just bear feed.
Or, the straw that breaks the camels back.
Let's give Sulik an Hawaiin birth certificate, get him a 2 week gig as a community organizer, some fake ivy league shit, and like, y'know?
I was going to say Sulik for POTUS.
Sulik is basically the Don Draper of the EU.
Spiegel "Are you not afraid that the markets might go down?", Sulik "Fuck the markets."
Damn straight.
Obama set the pecedent that a non-natural born citizen can become POTUS.
Who would think that a straight talking, truth telling individual could even make it into politics, whether in Slovakia, or in the country running the greatest ponzi scheme the world have ever known.
So, if we elect Romney will we get Obama's second term, while a Perry win would just be Bush's third term.
Primaries pick the party's Presidential candidate, while the November election picks the President.
So get out and vote during the primaries and choose Sulik's American counter part.
<quote>So get out and vote during the primaries and choose Sulik's American counter part.</quote>
The last time we had someone like that, he was taken out during the last year that most of our coins contained silver. How blatantly fucking transparent...
You know what else. Reagan was shot just 69 days after his first election. Kinda didn't follow his own tune after that.
"It's ridiculous how politicians orient themselves based on whether stock prices rise or fall a few percentage points." This guy Sulik is my fucking hero. Yeah I wouldn't be surprised if he got death threats. Notice how as soon as Sulik says, "How am I supposed to explain to people that they are going to have to pay a higher value-added tax (VAT) so that Greeks can get pensions three times as high as the ones in Slovakia?", Maria's tone changes from confrontational to asking for his opinion. She got Pwned.
i am from slovakia, reforms he talked about, were really painful, unemployment jumped over 20pc, costs of bank bailouts were over 3bl of euros.....
the fall of soviet empire was also very unexpected, none believed that someone like Havel, Walensa can in few months or weeks be elected president, no one now knows how this crisis will play out, and thats why a majority of people will be again caught by surprise when theirs savings will evapourate, then someone will definitelly get beaten the shit out of him, and it will not be Sulik, nor Slovakia
European banks will take haircuts. Maybe not as much as they should, and as Sulik - and all free market believers - want them to - but they will take haircuts.
And Merkozy et al will spit in, one way or another. As it must - EU & EUR will prevail.
Too bad for the US elite, who rigged Europe to fail with weapons of financial mass destruction - i.e. toxic US Wall Street garbage paper stuffed down EU banks..
Next chapter: watch US finance collapse over next 6 months.
As you sow, so you reap. US goes down.
"do you want to go down in European Union history as the man who destroyed the euro?"
YES I DO, that's exactly what i want to be known for going down the history books! I want to be remembered as the man who destroyed greece, spain, italy, portugal, ireland uk france belgium! I am the harbinger of debt war, I will deliver wholesale debt default across the continent! put your faith in me and you will never be afraid of banksters again!
Yeah, that was quite a combative tone for Spiegel to take at the beginning of the interview. Then there was the accusation of Nationalism, which is the European equivalent of Democrats implying that all Republicans are racist. I thought Sulik acquitted himself quite well. I wish more American politicians would stick to their convictions like this when actually in power, rather than only when running for office.
Ambush journalism at its finest.
No, it's actually the way journalists are supposed to work -- they are supposed to ask tough questions. The problem is that they don't ask them equally of everyone.
What surprises me is that Germany seems to have lost all its Austrian economic ideas. I have a degree in economics from one of the top German universities. I learned a whole lot of Austrian values there. Keynes was taught...with derision. And it wasn't all that long ago that I earned that degree....
Obviously, Merkel and Der Spiegel have changed.
Money printing eventually corrupts almost everything.
We need some zero hedge "Sulik" merchandise. The man is a heroic truth speaker, despite the viscious smear campaign doubtlessly just about to kick off.
That article was one of the best articles by der Spiegel to date as it showed that publication for what it was.
Best use for der Spiegel is under a beagle.
Your point is somewhat valid as we surely don't see equal questioning of bankers, but those weren't tough questions they were designed to shape the thinking of the reader. They put him in a harsh light. It wasn't a challenging question, it was psychologically directed propaganda.
That's not good journalism, it is akin to journalists this past summer asking Tea Partiers why they hated America by not raising the debt ceiling, or the same of war protestors against the Iraq invasion circa 2003 "Making America vulnerable to terrorists".
It's not a tough question, it is pure propaganda intended to skew the viewpoint of the reader, not to get the interviewee to dig deeper for an answer.
A good Journalist knows how to play the devil's advocate to pull the truth out of someone. No one answers more vehemently than someone who is defending their principles, and no one shows their true colors more clearly than someone who is put on the spot. I think the journalist asked the right questions that allowed Sulik to produce the right answers.
i thought it's hilarious that spiegel accuse this one politician in the slovakian opposition of bringing down the euro. isn't it convenient that spiegel fails to mention, germany's trade benefit tremendously from using the same currency as much weaker countries, german exports are cheaper and go further in the international trade, they get to buy more imports. then they come to slovakia, the country with the second lowest gdp per capita in the eu, and expect slovakians to bail out greece which have a much higher gdp per capita. disingenuous and disgraceful indeed.
Sulik, Shmulik who cares? Only idiots can believe that insignificant politcian in Slovakia may change anything. Just sheer nonsense.
Yes. The comments and questions asked by the interviewer are quite revealing. They tell me the story of how the propaganda machine is brainwashing the sheeple (including the MSM Sheeple). However, I cannot fault the interviewer for parroting what has been flooding the media for many, many weeks. I can, however, extend a Hat Tip to Mr. Sulik for his cool and logical approach to the emotional situation. I wish him success.
Nearly all men can stand adversity, but if you want to test a man's character, give him power.
Abraham Lincoln
and one more thing...... Good Job, Tyler.
Many more thousands of people will read that interview now.
"It's a good project. Everyone involved can benefit from it -- but only if they stick to the ground rules."
If just a few more important politicians in the US took that position about the American Experiment and the Constitution, we might not have to be totally flushed down the tubes of history that we are sluicing down now.
Absolutely agreed. Fortunately for Sulik, he lives in Slovakia, a nation with a multi-party political system. He'd never make it to a position of influence in a single-party system like the United States.
What Sulik has done in this interview is far more interesting and significant than is readily apparent. In most nations, politics at the national level has attained two Nash equilibria: one with truthfulness and the other with TBTF finance.
Politicians of all parties know that the truth is dangerous and so the unwritten rule is to avoid it if at all possible. At best, they can accommodate a truth from a parallel universe Earth if forced to do so. The tacit agreement is that the game is played by hurling well rehearsed cartoon-like talking points about wedge issues at each other.
They also know that elections are bought, not won. The TBTF financiers control big media, big advertising, and big public relations via multiple redundant backchannel money conduits. When it comes to financial shenanigans at the TBTF level, politicians prefer to ignore it, minimize it, and/or blame the victims. In a worst case scenario, they will pass hollow legislation like Frank-Dodd and then, with a wink and a nod to Wall Street and/or the City of London, trumpet it as significant reform.
Sulik must have expected this line of questioning because his answers were rational and precise. He spoke the unspeakable truth when he said that going broke as a result of poor decisions is a consequence of the market economy. He also named those who must not be named when he pointed out that the beneficiaries of the bailouts are the TBTF banks.
If Sulik succeeds with the radical strategy of telling the truth and naming names, the Nash equilibria mentioned above could easily fall apart. In their place would be a Prisoner's Dilemma where the greatest political advantage would go to those who are first to admit to mistakes and embrace the truth.
This interview would be amazing as an xtranormal cartoon.
Excellent idea!
Regards,
Cooter
As the EURO RIPS. I'm tired off this bullshit.
Green shoots!
Who woulda thunk Slovakia so sober?
Yes. That was unexpected.
That was a breathtaking exhibition of sanity, I thought. What a shock!
We should breed people like that. Let's get him to impregnate a few hundred women around the world so that we can spread around some good genes.
Slovakia is a good place for that. I remember several years ago on my first trip to eastern Europe I was just astounded at the number of smoking hot chicks walking the street in Bratislava. Eastern Europe is really where it's at in that regard.
www.singledudetravel.com/2011/01/eastern-europe-now-do-you-see/
Plenty of hot Slovak chicks around Wilkes-Barre, Pa-still have some Arthur Treacher's Fish and Chips joints there too!
Really?
What the hell are they doing there?
Most women, the world over, are not interested in good genes or intellignce, but some pretty boy who has a lot of income or popularity (e.g. one long line of bullshit). Those rare women who think otherwise are few and far between.
every one of them is a whore basically.
I'm shocked by your sexism given your feminist avatar. It is a pro-breast feeding pic right? Right?! Riiiiiiiiight.
Speak for yourself. I chose well. Geeks/Nerds rule.
Hohoho. Here's a guy who hasn't gotten any action for a long time. If all the women are rejecting you, maybe it's you.
Adrian Cronauer: "You are in more dire need of a blowjob than any white man in history."
Hohoho. Here's a guy who hasn't gotten any action for a long time. If all the women are rejecting you, maybe it's you.
Adrian Cronauer: "You are in more dire need of a blowjob than any white man in history."
does that country have an invisibility cloak?? how come they haven't been suicided, attacked by 'rebels', bribed, drugged, blackmailed or framed for sex crimes???
The correct term is ,cloaking divice. Obviously made some sort of pact with the Romulans or Klingons.
a flat tax and follow the rules......now that cant work....that makes too much sense
like RP and follow the Constitution
Right, cant have that...it doesnt funnel free billions to the top .5%.
Diogenes, I believe you have found him.
brilliant
Go Slovakia! Be the Iceland of the EU. Someone has to, at least try, to stop the insanity.
I think he would not change his mind. But here in Slovakia the opposition is now considering voting for the passage. So I hope that it would not pass, but you never know, SAS party is the only one here against this bullshit EUROFail, so I m still cautions...corruption all over here as in every other country.
There is no credibility to restore. Who is still volunteering to join the EuroFiatscoDebtClub now ? Turkey ? Poland ? Hungary ? The Czechs ?
Yep. Game over.
Right now sark and merk are arguing whether to use efsf to either bail out banks or countries. France wants to recapitalize banks. Why? Because in order to nationalize dexia, socgen,et.al they cant risk their own governments money. To do so would automatically lead to a french downgrade.
Germany wants to use it to bail out greece and the other countries.
I have a feeling that france's banks are at immediate risk now and germanys could afford to kick the can a little longer.
Its really now french vs german banks with dexia(part french) taking it first. Germany knows this.
Slovakia see's no benefit either way so they stay out (unless that payoff purse gets bigger;)). Greece is also going down at anytime. Something tells me that 167 billion the US borrowed this last week went directly to MS, BofA, and greece.
Dexia is too big to save and too big to let fail. The eurozone either prints to cover the losses or takes the losses. Borrowing more wont even work for a month because the efsf is not big enough. And not everyone can agree on how to do eurobonds.
Sounds like checkmate to me. Any thoughts?
Dexia is not too big to let fail, the senior bond holders are too influential to allow the politicians to let it fail (until the current ones manage to sell it to central banks and specially orchestrated honeypots for retail investors and pension funds).
That there is no such thing as TBTF is the whole point mr. Sulik is making ... there never was. The financial industry is overrated and overgrown, if push comes to shove the central banks can jump into the bond market to keep the big companies going and government can nationalize some banks AFTER bankruptcy and fund them to keep small business loans and mortgages going ... all while the financial industry is collapsing into a firy death around us. The productive part of the economy is not reliant on the 95% of the financial system which would be dying.
No way is he a politian- he speaks too much sense
Sounds like it's about time for him to be embroiled in a scandal or die with a "totally plausible" explanation. We should all know how these things go by now.
richard sulik watch out, smear campaigns will be going your way
they'll have to import all the smut and lies. their women are very much reserved
http://society.ezinemark.com/how-to-pick-up-girls-in-slovakia-3195f294b86.html
they will find skulls of babies in his closet for this kind of statement. The cure for too much debt is more debt, period. Everything else is heresy.
He made a tremendous amount of sense. I especially liked the way he responded to the whole- if you don't believe in morally hazardous taxpayer bailouts you are a selfish nationalist pile of pure garbage fallacy.
He did leave out something important. These countries need to reverse the stupid & unnecessary EU legal tender restriction. There's no reason these countries cannot have tender trading side by side with the EUR.
Especially the "we agreed to a known set of rules and nothing else". There's no arguing against that.
made sense and has a voting share in the debate = a bullet soon nearby his head
He was a former business man. His party was the biggest surprise here in Slovakia because he targeted the young online community and get huge support. He was a former businessman, build succesflull printing company here and he also engineered the flat tax for Slovakia few years ago. I support his stance of NO support for the bullshit fund. But its still a polititian...
I hope the Slovakian people come out in droves to support him and pressure the others. He will at least save your country from eternal bank slavery.
fighting for this for a long time here in Slovakia !! my last www.offgridminds.com, I have a group of 60 people on FB here in Slovakia where I send and explain them most of ZH stuff. Was head of analytics team here in a small financial company, I m fed up with this FEDonism society, hope normal, honest and creative people get their chance in new system. Bought more gold this weeek, of course only physical.
don't forget the Czechs were smarter than Slovaks by staying out of Euro and keeping their koruna to manage their own affairs after the break up of czechoslovakia
you nailed it, Klaus helped them to avoid this euro tragedy.
It's too early to say which country chose correctly.
in the end they will obey, though the slightest miscalc could create an Archduke moment
for now it's political brinksmanship against the backdrop of the possibility of extorting for personal or national gain
Who can forget the Senator named Landrieu who "bragged about receiving $300 million for her state in exchange for her vote on the Senate health care bill"
http://www2.hernandotoday.com/content/2009/dec/18/weapons-government-ext...
Don't get me started on that bitch. I live in Louisiana. Perhaps I should stop now before it turns ugly.
TPTB will peel off some votes from the opposition parties. They will be made an offer they can't refuse. Mr. Sulik makes a lot of sense to Zerohedgers. The system is going down, but Slovakia's vote on Monday will not be the modern equivalent of the assassination of Arch Duke Ferdinand.
Richard Sulik for US Prez '12 !
With 300,000,000 people here,one would think that a viable choice like him would emerge.I allow myself to think"what if" sometimes,but get promptly jolted back to reality.Our success will only come when and if a clear thinker emerges after the SHTF.
Judging by his background (studied physics, started his own company) he is way over qualified to be a politician in the US. Too bad most of the politicians in the country are lawyers, career politicians, or partisan aholes. We need more clear thinkers in government period.
read their recent history.. JPMorgan bribed and crooked lots of assets from them.. this new group emerged from the ashes and know 'the worst' is not as bad as being debt bitches
The overlords want a different outcome. We saw them circumvent logic with the "Euro Constitution" and I am sure something similar will happen again. Granted, their power may be somewhat weakened and their plans very grand but it would be surprising to see Mr. Sulik be the hurdle that made it all crumble.
or maybe a major player is encouraging him to take a stand and be the fall guy so after it all implodes there will not be a direct connection/pointed fingers and target for WW3. It was all Slovakia's fault don't you know.
Truth is nobody knows for sure. On the other hand, why would they try so hard and use so many subversive and underhanded techniques to squeeze through the "constitution"? So that it could all fall apart and start ww3? Seems like there would be easier ways to start ww3.
So far my conclusion is, they have propped everything up with absolute horsesh*t because of all the power and money. People are starting to see through it and are reacting so everything has become an uphill battle for TPTB. The harder things become, the easier it is for the their soft underbelly to be exposed. Their success is based strictly on ignorance. You need about 3 tons of lies and manipulation to counteract an ounce of truth.
The stage is already set for WW3. Asia. We don't need no stinking Archduke for this one, Amigo.
enter DeutscheMark printing presses
Why do I suspect Sulík is going to have some sort of fatal accident in the very near future?
yes, or a 'chance encounter' w/ a hotel maid maybe ?
Sulik is showing some backbone and moral sense, unlike the Finnish thieving corrupt politicians.