Oz: the Anorexic Country.

Last year, shortly after winning the state elections, Barry O'Farrell, NSW Premier, announced a AUD4.5bn "black hole".

Although O'Farrell (Liberal Party) had promised not to touch the state public service, public finances were in such a catastrophic state that radical austerity was desperately needed. In conservative-speak: there was much fat to trim.

O'Farrell wasn't alone. According to a Crikey analysis (July), "38,000 public service job cuts have been announced at the federal and state levels over the past few years. A further 24,000 positions are on the line (the federal Coalition says it will cull 12,000 positions, while the Queensland government has hinted at a possible further 12,000-20,000 job losses)".

For NSW, the "2012-13 budget set a 1.2% per annum reduction in labour costs across the public service, which unions say equates to 10,000 jobs", 5,000 of which are "voluntary" redundancies. And that without counting cuts in health (AUD3 bn over four years), plus education cuts. Thank goodness the Liberal Party guys are such brilliant economic managers, always ready to take "courageous" decisions (ask shadow federal treasurer Joe Hockey).

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Do you believe in miracles? Well, they do happen. And the one delivering the miracle was no one other than the NSW Auditor-General, Peter Achterstraat:

"An expected deficit of $337 million [announced by state treasurer Mike Baird] in the middle of June became a surplus of $680 million by the end of June."

And how did this miracle happen?

"There were 37 errors of over $20 million each in accounts the Auditor-General's office identified and corrected.
" 'I would say that a $1 million error is unfortunate, a $10 million error is undesirable but a $100 million error is totally unacceptable,' he said.
"This is not acceptable for an entity the size of NSW that manages billions of dollars of assets and public funds.
"There is a lack of effective financial management capability in this state and it must improve."

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In the meantime, in what conservative think-tankers and spin-masters will argue is an entirely unrelated development, this is how unemployment (trend, seasonally adjusted, according to the ABS's latest release 6202.0 - Labour Force, Australia, Sep 2012):

Thanks for nothing, Barry, Mike, Tony, Joe, Julia, and Wayne. Keep trimming the fat.

Greece and Spain: Crime and Punishment?

We all know the conservative narrative: the honest, long-suffering and wealthy taxpayer was being ruthlessly extorted huge amounts, which were immediately grabbed by the selfish and lazy moochers, via "entitlements" (enter the old-timers in age pension, the "welfare queens", the lazy voluntarily unemployed, the crippled; you know, "those people"); the cunning American borrowers lied to the naïve banks in their mortgage applications.

Bottom line: "those people" were living beyond their means. Now, the morality play concludes, they must pay. It's time to unshackle the job-creators, give them a break.

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In 2004, when the Duke and Duchess of Parma wanted to buy a home, they, like everybody else, applied for a mortgage loan (See here, in Spanish). They asked La Caixa for a EUR 5mn loan, in order to pay for an apartment valued 5.8mn, at the time. Over a 30 year period, the monthly payment (variable interest) was over EUR 17,000.

At the time, according to the information provided, the couple's net worth was EUR 3.6mn (1.3mn in check and savings accounts), and His Excellency, Iñaki Urdangarín, was already guarantor to 3 other mortgages.

Among the paperwork, His Excellency - His Majesty don Juan Carlos I of Spain's son-in-law - included his tax declaration (See here, PDF, in Spanish). That year, His Excellency declared a before-tax yearly income of EUR 36,000, or 3,000 a month.

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And, you know what? In October 2004, La Caixa approved the loan to the couple.

According to Reuters (October 18):

"Loans that fell into arrears in August increased by 5.3 billion euros ($7 billion) from July, reaching 178 billion euros, Bank of Spain data showed on Thursday.
"Non-performing loans on the books of the country's crippled banks have risen steadily since a decade-long property boom ended four years ago.
"Spain's lenders are preparing to receive the first funds from a 100-billion-euro ($131.21 billion) credit line agreed with the European Union in June which is seen paving the way to a full sovereign bailout." (See here)

And as experience shows and unlike PM Mariano Rajoy once tried to convince the Spanish people, those funds do come with strings attached.

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And speaking of unshackling the Atlases. Last week Rajoy's government ordered the release from jail of 4 of his PP colleagues who had been sentenced in 2009 to prison terms ranging from 3 to 10 years, for the commission of 31 instances of corruption. (See here, in Spanish).

Asked in Parliament to justify the measure, the Rajoy Government gave no reason. The sentence was not questioned.

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In Greece, the journalist Kostas Vaxevanis was arrested today after publishing a list with the names of 2,059 tax evaders, allegedly including the president of the Greek Parliament, several high officers of the Finance Ministry and a number of high executives and business people. (See here, in Spanish; here, in English)

The list, sent to the Greek government in 2010, was compiled by Christine Lagarde, then French Finance minister, currently head of the IMF. According to George Papaconstantinou (PASOK), Greek Finance minister in 2010, the list was lost.

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This is what underlies the conservative/semi-fascist bullshit.

Precious Bodily Fluids and Free Markets.

"Mandrake, do you recall what Clemenceau once said about war?

"No. I don't think I do, sir. No.

"He said war was too important to be left to the generals. When he said that, 50 years ago, he might have been right. But today, war is too important to be left to politicians. They have neither the time, the training, nor the inclination for strategic thought."  (General Jack D. Ripper)

The quote above is from Stanley Kubrick's 1964 film "Dr. Strangelove" and Ripper is a fictional character.

Soviet military sites in Cuba, 1962. [A]

If you haven't seen it yet, this is a good film to watch this month, as the world commemorates the 50th anniversary of the very real Cuban missile crisis, and we approach the 49th anniversary of John F. Kennedy's death.

Kubrick's black comedy (starring Peter Sellers and George C. Scott) takes a shot at the anti-Communist hysteria then prevalent in the US: for instance, it mentions a "Bland Corporation" (a reference to the real RAND Corporation). To be fair, probably a good case could be made about similar attitudes in the USSR.

John von Neumann. [B]

It has been said that one of Sellers' characters (Dr. Strangelove) is a composite of several real-life scientists, many of Eastern/Central European origin. Fairly or not, one name suggested as possible inspiration is John von Neumann. Other possibilities are Wernher von Braun and Edward Teller.

Neumann, by all accounts, was one of the most gifted minds of the 20th century, having made important contributions to many fields, including economics.

Neumann was born to a Jewish banking family from Budapest, then in the Austro-Hungarian Empire. For reasons I won't mention (as I won't spoil the movie for those who never saw it) but that will be obvious to those who have watched the movie, this is relevant against the charges that Neumann has anything to do with Strangelove.

At the other hand, Neumann, like Strangelove and many among those European émigrés (Oskar Morgenstern and Ludwig von Mises come to mind), was furiously anti-Communist:

"If you say why not bomb [the Soviets] tomorrow, I say, why not today. If you say today at five o'clock, I say why not one o'clock?" (Neumann, supposedly in 1950. See here)

It makes me wonder how Neumann and Albert Einstein (who was sympathetic to socialism) would have gotten along at the Institute for Advanced Study, in Princeton University, where they were neighbours.

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Neumann's theoretical contributions to economics, Jack D. Ripper's quote above, and what we are seeing in Europe, make me think that perhaps the economy, like war, is too important to be left to its practitioners, its theoreticians or even to politicians.

Of course, I don't expect businesspeople, economics professors or politicians to agree with me.

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Let me close this post with the rest of Ripper's quote, where he explains why he overstepped his authority and ordered a nuclear strike against the USSR:

"I can no longer sit back and allow Communist infiltration, Communist indoctrination, Communist subversion and the international Communist conspiracy to sap and impurify all of our precious bodily fluids."

The BADGER explosion on April 18, 1953, Nevada. [C]

Image Credits:
[A] Soviet Military Build up in Cuba, late October 1962. Author: US Department of Defense. Wikipedia.
[B] John von Neumann at Los Alamos. Author: US Department of Energy. Wikipedia.
[C] The BADGER explosion on April 18, 1953, Nevada. Author: Federal Government of the United States. Wikipedia.

Greece: a Coming Civil War?

Or, Who's Worse?

These two reports from Greece, by the BBC's Paul Mason, speak by themselves. It is all about ignorance, misery and unapologetic beastliness. And it is about what the European political, financial and bureaucratic elites have unleashed upon their countries and humanity, more generally:


I imagine, or at least I hope, most of my readers, regardless of ideology, class, race, religion, age, gender, income, wealth and nationality, would be genuinely appalled by that video.

However, I'll submit that seemingly ordinary, respectable people, people we may know personally, or with whom we regularly interact over the net, are capable of behaviour worse, in a sense, because of their deep dishonesty.

Probably these people, for some reason, have never themselves done the things we saw in the video. Whatever has stopped them, so far, probably lies on a continuous scale ranging from the simple lack of opportunity, to the fear of losing their peers' respect.

In any case, you won't see them slapping old women's faces in front of TV cameras, harassing foreigners in the street or calling openly for an ethnically motivated civil war. Imagine! They are above that.

Unlike those unapologetically thuggish characters in the video, these people, our "friends", try hard to appear reasonable: their middle-class peers value moderation, reasonableness. And because they are "moderates", "centrists", "realists", they are quick to condemn extremes (including their shamelessly animalistic brethren).

But you can guess their true feelings by their eagerness to defend the obviously indefensible, or to at least find attenuating circumstances for it.

Take, for instance, these two comments, copied verbatim from a somewhat left-leaning site, on a The Guardian story (which I strongly urge you to read before the comments):

First Poster said...
"Re Nazis, that Guardian article said that 'if they come they will be met by leftists who have said they will beat them up with clubs'. Since Hitler used street violence, is it the political left or the political right who are Nazis?
"The same thing has happened in Britain: we've had members of left wing groups arrested for street violence.
"Hitler used to kill the authors and film producers he didn't like. Muslims do likewise, so Muslims are Nazis?
"The Nazi jibe is a strong indicator that the person using the jibe has run out of arguments". (September 29, 2012 8:22 PM)

I hope to be making a storm in a cup of tea, so I won't name either poster or facilitate their identification. If they read this, they know who they are. The other readers, I am afraid, will have to take my word for it: those are real comments.

The comment above, for instance, comes from a "progressive" blogger and commentator fairly well-known and popular in the lefty blogs I visit daily.

The other one, which if anything is worse, is from a self-described economics student, who once was critical of mainstream economics, but who saw the light in the road to Damascus and now frequently criticizes radical and heterodox economists (and anything left, really):

Second Poster said...
"What 'First Poster' has noticed is an odd asymmetry in the way that left and right wing extremists are treated.
"Right wing extremists provoke much wailing and gnashing of teeth over the coming Nazi-pocolypse. They must be always and everywhere defeated and crushed under foot.
"Left wing extremists are completely normal. They should be placated with concessions and other shiny things to mitigate their wholly legitimate grievances". (September 30, 2012 1:39 AM)

I won't pretend that I am reasonable, impartial, or moderate: I wouldn't fool anyone if I tried. Neither am I middle-class or respectable: I am working-class, poor and no one gives a shit about me.

I won't go into a discussion over the First Poster's childish attempt (Godwin Law) to spin what are neo-Nazis into something less poisonous: if it looks like a duck, swims like a duck, and quacks like a duck, then, it probably is a duck.

Neither will I accept the Second Poster's "denunciations" of double standards: it's not that left wing "extremists" wrongly perceive the situation in an asymmetric manner, the situation is asymmetric. His side (that in his view should not be crushed under foot) is actually using violence against the defenceless; the left wing "extremists" are threatening to use violence in defence of the defenceless and are paying a price for that, at the hands of the Greek police.

More briefly and to the point: you both can take your "arguments" and shove them up your reasonable, moderate, centrist, realist, impartial asses.

And, just so you both know, the contempt is mutual.

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I'd advice a good dose of skepticism, when dealing with "reasonable", "moderate", "centrist" people: extremists speak their mind more clearly. It's easier to judge what they say.

In this, these "moderates" are worse than the Golden Dawn.

Update:
20-10-2012. Mason has another post on the similarity between Greece and the Weimar Republic. He traces the history of the last 3 Weimar federal elections and the post is interesting, even if Mason is confused in some points.

It's not accurate to say, like Mason does, that "right wing general Kurt Von Schleicher was appointed chancellor, and tried to form a government with everybody from the left wing of the Nazis to the socialist trade unions".

For starters, he did not try to form a government with the Communists, as they were totally unacceptable to him and the German plutocrats he represented (neither, I believe, would the Communists have accepted).

Second, for Schleicher (plus Hindenburg and their gang) the Nazis were an slightly less bad an alternative than the Communists, because they thought they could outmaneuver them. After all, they were the aristocracy and elite of Germany, by definition the smartest, most capable, people in Germany, in their own appreciation.

Schleicher's goal was to become a military dictator himself, very much like Engelbert Dollfuss, in Austria. As it happens, Schleicher badly miscalculated and paid the ultimate price for that, just like Dollfuss did. And I, for one, find little reason to lament their personal fates.