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Friday, June 22, 2012

Greece Committed to Bailout but Wants More Time, Adviser Says


The Guardian

Greece Committed to Bailout but Wants More Time, Adviser Says
Wall Street Journal
Greece's new coalition government will focus on changing the timeline for its latest bailout when it meets with European leaders in the coming weeks, a senior adviser to the country's new prime minister says in an interview with Dow Jones Newswires.
Greece's new finance minister hospitalized; new PM to undergo eye ...Washington Post
Greece's new finance minister hospitalizedBoston.com
Greece's new finance minister in hospitalFox News

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The European fiscal treaty is an enemy to democracy | Sahra Wagenknecht

Because no elected government would stand a chance of revoking this policy, I will vote against the ratification

Germany's Chancellor Angela Merkel has been key in deciding the course of the European crisis policy. The fiscal treaty and the European stability mechanism (ESM) are an attempt to dictate this policy indefinitely to the countries in Europe. This strategy, however, ignores two fundamental facts. First, it was only after the worldwide financial crisis in 2008 that the state debts started rising. They did so because of a global recession and the bank rescue packages. It is not true that European countries had been living beyond their means. Second, Merkel's crisis policy ignores the fact that high spending cuts have a negative impact on economic growth.

At worst, this kind of policy leads to a recession. In Greece this policy has been carried to extremes. In recent years the Greek economy has slumped by 20%. This usually happens only in wartime. Youth unemployment in Greece, like in Spain, now runs as high as 50%. The result is a steep decline in tax revenues which leads to a mounting increase of the Greek state debt despite all spending cuts. This policy, in the meantime, has driven the entire eurozone into a recession. The EU commission predicts negative growth for 2012.

Enforcing the fiscal treaty in a situation like this would coerce the whole of Europe into budget cuts for decades and by so doing would permanently strangle economic growth. No country in the eurozone – with the exception of Finland and Estonia – would have fulfilled the criteria of the fiscal treaty in 2011. This means that 98% of the economy and the population in the eurozone would have been subjected to quasi-automatic budget cuts in 2012, with Brussels controlling their enforcement. The fiscal treaty is an enemy to democracy because no elected government would stand a chance of revoking this policy that has been dictated. The international treaty does not allow for unilateral termination. Infringements would lead to court proceedings before the European court and eventually to penalty payments for the country in question. The fiscal treaty is a scandalous deprivation of the will of the population.

It is odd that it is Germany of all governments that is the driving force behind this madness. After all, it was Germany that at the beginning of the 1930s experienced first-hand how a policy of that kind led our country at first and then the entire world into the catastrophe. A policy lacking all solidarity is also incomprehensible because it is German capital which by means of an aggressive export policy has profited way above average from the common currency ever since it came into force. This is why it is particularly important that Merkel is reminded of her destructive role at every possible occasion. Many by now regard the developments in Europe as a danger for the world economy. The statements of the heads of government at the G20 summit showed this clearly. It is even worse, of course, that this policy divides Europe and destroys the future of the people.

In order to break the vicious circle it is necessary to stop the fiscal treaty and the policy of budget cuts coming along with it. Otherwise all decisions to add growth impulses can only be regarded as fig leaves. Sound public finances cannot be brought about by a fiscal treaty that strangles economic growth and tax revenues. State budgets can only be restored by increasing state income by means of a strict redistribution of wealth. High mounting debts and unevenly spread wealth are two sides of the same problem. It can be resolved by adequately taxing millionaires and high profits. With the fiscal treaty, an alternative policy cannot be enforced for a long time to come, because the treaty explicitly states that budget consolidation through spending cuts is paramount.

This is the reason I am going to vote against the ratification of the fiscal treaty and the permanent rescue scheme in the German Bundestag, together with my parliamentary group Die Linke (The Left). Should the bill pass, which unfortunately is likely because the other opposition parties in the German parliament have yielded their position, we are going to take legal action and file suit against the treaties before the German constitutional court.

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Greek government hit by double health scare

New finance minister rushed to hospital after reportedly fainting, and PM to undergo surgery for eye problem

On a dramatic first day for the new Greek government, the finance minister reportedly fainted and was rushed to hospital, where doctors insisted he remain for at least 48 hours.

Vassilis Rapanos, 65, who is known to suffer from a longstanding illness, collapsed after complaining of dizziness, the state-run NET TV said. He underwent tests, and the Yghia clinic said his condition had stabilised but physicians recommended he not be released immediately.

Earlier it was announced that the prime minister, Antonis Samaras, who was sworn in on Wednesday, was cancelling all his appointments because a routine eye operation had found he had the early stages of a detached retina. "It was decided that it be dealt with surgically," his office said. "The operation will take place tomorrow morning."

As a result, the conservative leader was unable to attend his first parliamentary meeting, or Friday night's Euro 2012 quarter-final between Greece and Germany in Gdansk, Poland. The German chancellor, Angela Merkel, an avid supporter of her national team, travelled from a mini summit of eurozone leaders in Rome to attend the match.

Rapanos's apparent fainting spell came hours before he was due to be sworn in. He had delayed taking the oath of office to allow the outgoing finance minister, Giorgos Zanias, to represent Greece at a meeting of eurozone finance ministers in Luxembourg.

It was unclear whether the incidents would affect government policymaking. The new administration, which comprises the socialist Pasok and small Democratic Left in addition to Samaras's centre-right New Democracy, was due to outline its policy programme in parliament before receiving a vote of confidence.

Greece's troika of creditors – the EU, ECB and IMF – announced that inspectors would return to Athens on Monday.


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Hospital: Incoming Greek finance minister admitted for tests


Financial Times

Hospital: Incoming Greek finance minister admitted for tests
CNN
Greece's new finance minister, Vassilis Rapanos, was admitted to hospital Friday for tests, a day after he took on the role, officials said.
Greek finance minister taken to hospitalChicago Tribune
Greek Premier to Get Surgery, Finance Minister HospitalizedSan Francisco Chronicle
Greek Fin Min Taken to Hospital After Fainting SpellWall Street Journal
Washington Post
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Press Watch, June 22

The Athens press greeted the new government with a mixture of hope and scepticism. Some newspapers – mainly opposition, which in this case means mainly pro-Pasok – complained that most of the ministers came from the old guard of the conservative New Democracy party.

Most papers focused on the appointment of the former National Bank of Greece governor – and president of the Hellenic Banking Association – to head the crucial finance (...)

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Greece's new finance minister hospitalised

GREECE'S new finance minister was taken to the hospital on Friday, hours after officials announced the debt-struck country's new prime minister was to undergo eye surgery for a detached retina.






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Greek finance minister admitted to hospital

Greece's new finance minister, Vassilis Rapanos, was admitted to a hospital Friday for tests, a day after he was appointed to the key government role, hospital officials confirmed.

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Ed Miliband was right to acknowledge immigration concerns

Labour was too quick to dismiss the concerns of ordinary people as prejudiced, but reforming the labour market won't be easy

Let church bells ring, and this time not for the Queen. Ed Miliband has admitted Labour got its immigration policies wrong in office. That's true – blindingly obviously so. Assorted ex-ministers have been saying so for some time now (after they'd safely left the government), but it's good to hear it from the man in charge.

Tory governments have also made mistakes on immigration policy since the Empire Windrush landed the first of what we then called West Indian newcomers in 1948. The Attlee government was gearing up to restrict the flow when it lost office in 1951, and the incoming administration settled for cheap labour in an expanding economy. We are still "addicted" to the habit today, the CBI told David Cameron last week.

When the Tories imposed restrictions on arrivals from the Caribbean and Indian subcontinent in the 60s Labour squealed "racism", but it did similar things in office. Remember Labour's curbs on the expelled Kenyan Asians in 1968, and how much more decently Ted Heath behaved when a similar fate befell Uganda's Asian citizens a few years later. Remember, too, that a lot of Labour voters backed Enoch Powell's grisly warnings of the period.

One of the more interesting points made on Miliband's behalf came from Matthew Taylor, the Blair-era No 10 boffin who now runs the RSA thinktank. The immigration debate was no longer about race, he said, because the target of concern is now the east Europeans who have flocked here since New Labour's big miscalculation that gave citizens of new EU member states such as Poland unrestricted access after 2004.

Nice try, Matthew, and you're half right. But it isn't so for some people, any more than it's credible to say those nasty grooming cases in Lancashire – another dreadful one in the news today – have little or nothing to do with the exploitative cultural attitudes of some Pakistani immigrants towards vulnerable young white girls. Such attitudes cut both ways and the posh people running MigrationWatch sometimes seem almost as happy to stir the pot as the BNP.

As everyone now knows, the influx of Poles and their neighbours into Britain (not France, where "Polish plumber" is a swear word) after 2004 was not the 13,000 once predicted, but more than half a million. Not all of them went home – why should they? – once they'd saved up for a car or house, or once sterling slid against the zloty, making the UK a less attractive place to work and save. That was predicted, too.

Did ministers lie, as Lord Glasman (remember him?) now says? No, they deceived themselves, as people often do. Jimmy Carr has repented his tax arrangements this week. Now it is Labour's turn on immigration. Can Ed Balls's confession to errors of economic management be far behind? Well, since you ask, I'd guess miles behind. But it will have to be done one day if Balls is not to waste the rest of his career.

In his Guardian interview with Patrick Wintour and his speech today, Miliband is saying Labour was too quick to dismiss the concerns of ordinary people as prejudiced – "bigoted", in Gordon Brown's famously self-damning phrase, which Miliband tactfully omits. His answer is to try to reform what he calls a "brutish" labour market. How? By requiring firms with 25% non-UK employees to register, by tightening up employment agency "local connection" rules to prevent discrimination against locals, by not repeating the Blair/Brown access error when Croatia joins the EU and – we hope – by making higher skills for the unskilled pool of British workers a greater priority.

Good, though coalition ministers promise similar things. I heard Theresa May this week saying she would succeed in cutting net immigration to tens of thousands while not excluding the skilled people the City is always asking for (they never fill their quotas, May said). Good luck. In a mobile world where travel is relatively easy and a liberal, English-speaking, open economy is a magnet, it won't be easy.

Half a million French people now live here, most young and talented, and Fran├žois Hollande's new policy pledges has provoked David Cameron to invite a few more while France gets our sun-seeking OAPS. That sounds like a bargain. Unfortunately, hot money refugees from Russia, Egypt, Greece and other troublespots make some middle-class Londoners, the younger ones, feel as threatened in their search for homes, jobs, schools and doctors as the poorer Labour voters Miliband hopes to reassure.

Today's Guardian leader sets out with admirable fairness the case for action and the dangers of not taking any. It quotes a report (pdf) by the National Institute for Social and Economic Research to support the view that an influx of newcomers willing to work does not depress local wages nor push up local unemployment, as Tory papers routinely assert.

Employment rates that peaked at a startling 74% in 2004 remain very high, but unemployment rates have tripled to more than 8% and official analysis seems to confirm that a large proportion of new jobs created in the economy have gone to people born overseas. Put it another way: "How can my unskilled constituents compete with a highly motivated, multilingual Pole?" as a Glasgow Labour MP asked me years ago.

It's a good question, and at a byelection in Glasgow a local baker explained in my hearing that he always tried to employ fellow Glaswegians to make his bread (he competed with five supermarkets within two miles) but ended up employing Poles and other foreigners: benefit withdrawal for paid work didn't make it worth employing local people.

I've heard this time and time again in different parts of the country, along with complaints that foreign workers are undercutting local wages and being employed on terms that English people would not accept. "How can I compete with a group of Poles sleeping in a van?" a Welsh electrician once asked me. "They're taking our jobs," they say on the big farms of Lincolnshire.

"The locals don't have the skills or the motivation, they have too many excuses," counter employers of the kind Peter Walker interviewed for today's Guardian. Why can't they both be right? Plenty of people look bloody hard for work and succeed against amazing odds. But some people are content not to bother or – so Iain Duncan Smith now suspects – work for cash and top it up with benefit.

That component of the debate was the factor missing from Matthew Taylor's exchange with the leftwing Labour MP Jon McDonnell on Radio 4's Today programme, and with John Denham, Miliband's righthand man. It was Denham who alerted me to the evidence that people most likely to be English nationalists and anti-EU (he is a Southampton MP, one of few Labour MPs in the south) are those most fed up with things in general.

So Miliband is right to say that cost-cutting employers are part of the problem. So are agencies who look for docile foreign workers who may not mind sharing a crowded caravan or working for less than the minimum wage. But – as Peter Walker also found – skills and motivation are also part of the remedy.

Blaming migrants for shortages of houses or undercutting wages is wrong, Jon McDonnell says. His remedy is restored trade union rights to enforce decent wages (anyone for the BMA or the London bus drivers this week?) and a resumed programme of house-building. Everyone benefits from immigration ("I am the grandson of Irish immigrants"), the MP says.

Good for him, but it is in the short-term that rents rise, school rolls and GP surgeries are under pressure and the worst losers are usually near the bottom of the pile. Miliband was right, belatedly, to acknowledge their concerns. Now to the hard bit. You surely don't need to be a multilingual Polish graduate to pull a pint or serve a meal. But all over Britain it sometimes feels that way.

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Greece's new finance minister hospitalized

(06-22) 08:06 PDT ATHENS, Greece (AP) -- Greece's new finance minister was taken to the hospital Friday, hours after officials announced the debt-struck country's new prime minister was to undergo eye surgery for a...



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Mitt Romney's Greek chorus of Republican ideologues | Jason Farago

The GOP refrain has Obama turning the US into debt-wracked Greece – and never mind that their Irish poster-child bombed

As he left the G20 summit on Tuesday, President Obama told reporters he thought the ongoing European crisis "will potentially have some impact on the election". Well, no kidding.

The meltdown of the eurozone, simultaneously the most alarming and the most boring story of our times, remains the great unknown of this American presidential race. The formation of a new Greek government this week may delay the country's exit from the euro, but a controlled ejection this summer or autumn will rattle the US all the same. It now seems that Greece will go gently and not Lehman-style, at least. But nobody can predict what comes after – there and especially here.

And yet, however bad things get later this year, Europe is already weighing the president down. "I do not want to become Europe," Mitt Romney told a crowd in Frankenmuth, Michigan on Tuesday. "Look across the pond," he warned, and tremble at the sky-high unemployment. Frankenmuth, I have to mention, was a frankly weird place to say this, since the town is better known as "Little Bavaria" – visitors gawp at bogus Franconian houses and lederhosen-clad waiters serve weisswurst and imported beer. Maybe he was trying to make a point about German frugality.

But no matter: Romney, for well on a year now, has been insisting that under the president's leadership the US faces sclerotic European decline. Nothing new among GOP candidates, of course. But now that Europe really is in serious trouble, the line sticks a lot better.

Last week, Romney dismissed Obama's economic record and said he wasn't leading the country forward, but "forward on the way to Greece". This Greece bit is rather a refrain in the party now. "Unfortunately, we're on the road to Greece," warned Kelly Ayotte, the New Hampshire senator, at a rally with Romney last week. Obama has "put our country on the road to Greece", according to Connie Mack, the Florida representative and Senate nominee. "The president's budget isn't a blueprint for America; it's a road map to Greece," in the words of Washington Representative (and veepstakes dark horse) Cathy McMorris Rodgers. Stay on message, people!

Naturally, the "road to Greece" that these Republicans are cautioning against does not pass by a poorly designed currency union, insufficient tax collection, or political clientelism. To listen to these conservatives, Europe, and Greece in particular, are in freefall because of one thing only: government spending. Any state expenditure at all seems to be inadmissible – these new Republicans now deem it sensible to oppose paychecks for firefighters and teachers – and the debt Greece is now saddled with proves that government can never be trusted.

But as should be painfully clear by now, the eurozone is locked in a balance of payments crisis; debt in and of itself is not to blame. Greece and Portugal may have run large deficits during the good years, but so did Germany. Spain, which, with each passing week, looks more like the euro's final battleground, was running a surplus back in the day.

And anyone paying attention to Europe knows that there is zero correlation between the size of the state and the propensity for crisis. Austria and Finland, which are both eurozone members, rank near the top of the OECD for public spending and have remained strong during the crisis. Which eurozone state had the lowest public spending per capita? That would be Ireland: wrecked, miserable Ireland, junk-bond Ireland, which you may remember as the dream republic of every Cato Foundation fellow and drown-government-in-the-bathtub sandbagger.

Ireland, more than Greece, is the most telling case – because it reveals just how unstintingly the American right is committed to destroying the public sector, and how indifferent it is to evidence. In the boom years, as Ireland was transformed from one of the poorest European nations to one of the richest, US conservatives couldn't get enough of the place. Ireland was proof that trickle-down economics worked, the thinktanks enthused: keep taxes minimal and government tiny, and everyone gets rich! (And forgive me, but I cannot resist a nod to Thomas Friedman, the soi-disant center's favorite columnist, for telling German politicians that the Irish model was their only hope. The headline was "Follow the Leapin' Leprechaun".)

By the top of the boom, the Ireland worship had hit a fever pitch. John McCain, during his first debate against Obama, said the US had to cut taxes to Irish levels. He also mused that the first foreign trip of his blessedly unrealized presidency would be to Ireland, which Vice-President Palin might have heard of once from reading the back of the Lucky Charms box at breakfast. Romney himself, in 2008, enthused that "jobs have been flowing into Ireland" and that the US was in trouble because "money is all going to government and taxes."

We now know, of course, that the Celtic Tiger was, in fact, predicated on a massive property bubble, assisted by absurdly lax regulation, inactive government, and a healthy dose of corruption. Ireland now has zero economic growth; youth unemployment stands at 30%. Did this give any of the erstwhile Ireland boosters pause? On the contrary: apparently, Ireland was no free-market paradise at all! One Cato fellow, having praised Ireland for its Reaganite policies in the good times, suddenly concluded that the government was "spending like drunken sailors". The country that the right celebrated for its low taxes mutated into a redistributive hellhole. And as for the continued failure of the brutal austerity measures Ireland has since put into place – measures that look rather like the Republican economic plan here – the contortions are too ludicrous to summarize.

By now, really, it no longer comes as a surprise that these ideologues will never waver in their conviction that no taxes and nearly no state are the solution to every problem. In good times and in bad, the prescription is the same. All conflicting evidence is dismissed; any shred of support (Latvia!) is amplified a thousand fold.

But they can get away with it, still, because who's to stop them? Four whole years after the most ruinous disaster of laissez-faire capitalism most Americans have ever lived through, we still do not have a Democratic party willing to defend the economic role of government with a full voice. Until they do, we will be stuck in this trough of a Lesser Depression. And in the meantime, we must live in fear of the Romney economy, of American unfairness and European growth.


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Greek minister taken to hospital

Greece's finance minister collapses on his first day in the role, just after the new PM announces he needs an emergency eye operation.

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Greece's new finance minister hospitalized; new PM to undergo eye ...


Financial Times

Greece's new finance minister hospitalized; new PM to undergo eye ...
Washington Post
ATHENS, GreeceGreece's new finance minister was taken to the hospital Friday, hours after officials announced the debt-struck country's new prime minister ...
Greece's new finance minister hospitalizedFox News
Greece's new finance minister in hospitalBusinessweek

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Greek finance minister hospitalized

Greece's new finance minister, Vassilis Rapanos, was admitted to a hospital Friday for tests, a day after he was appointed to the key government role, hospital officials confirmed.

READ THE ORIGINAL POST AT edition.cnn.com

Greek Elections And The New Democratic Party: Playing Fear Tactics


China Daily

Greek Elections And The New Democratic Party: Playing Fear Tactics
Seeking Alpha
An upset for the Syriza party on Sunday in Greece cooled Wall Street expectations headed into the new week. The New Democratic Party of Greece barely ...
Euro Finance Chiefs Weighing Greek Debt ReliefVoice of America (blog)
Lessons for China from a Greek tragedyChina Daily
Greek government wants to revise bailout but stay in euroReuters
Financial Times -Billings Gazette -OregonLive.com
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New Greek PM Samaras to undergo eye surgery for early stages of ...


Bloomberg

New Greek PM Samaras to undergo eye surgery for early stages of ...
Washington Post
ATHENS, Greece — Greek authorities say the country's new prime minister, Antonis Samaras, will undergo eye surgery this weekend for a detached retina ...
Greek Premier Samaras Cuts Ministers' Wages 30% to Set ExampleBloomberg
Greek prime minister to have eye surgeryReuters

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New Greek prime minister to undergo eye surgery

(06-22) 05:33 PDT ATHENS, Greece (AP) -- Greek authorities say the country's new prime minister, Antonis Samaras, will undergo eye surgery this weekend for a detached retina discovered during a routine examination. The...



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