.comment-link {margin-left:.6em;}

Emet m'Tsiyon

Saturday, October 03, 2015

Mahmud Abbas' Nose Gets Longer -- Lies to Hide Arab Collaboration in Nazi Murders

Mahmud Abbas, or Abu Mazen by his nom de guerre, has the habit common among Arab political leaders and spokesmen/women/, of shamelessly lying. They even lie about each other fairly often, although Arab lies and unfounded or flimsily founded charges against other Arabs get little attention in many Western countries that want to see Arabs --especially Palestinian Arabs-- as always good and innocent, something like a collective Jesus.

However, in historical reality Arabs ruled empires that subjugated non-Arab, non-Muslim peoples. The non-Muslim subject peoples under Arab rule are legally oppressed, exploited, and humiliated as  people lacking rights under Islamic law, particularly that part of shari`ah called the dhimma, the laws and rules applying to these non-Muslims. Now, quite relevantly for Abbas's speech at the UN General Assembly, most of the Arab nationalist movement was pro-Nazi during the 1930s and 1940s. But what was Abu Mazen's specific lie?
The state of Palestine, based on the 4th of June, 1967, borders with East Jerusalem as its capital, is a state under occupation, as was the case for many countries during World War II. 
Here Abbas is trying to present Israel as like Nazi Germany by implication, while presenting the Palestinian Arabs as victims of the Jews. Throughout the history of Islam of course, since the Arab/Muslim conquests of the 7th century, Arabs and other Muslims have lorded it over Jews and quite lawfully according to Islamic law as said above. 
What is most important considering Abbas' speech is that during WW2 and the Shoah, the Arab nationalists generally and the Palestinian Arab nationalists in particular were pro-Nazi. This is no secret to informed people who know history but the run of the mill Western journalist is ignorant of this history. They ought to  be reminded. For information on how the top leader of the Palestinian Arabs during the Shoah --Haj Amin el-Husseini-- collaborated in the Holocaust, visited death camps, helped the Germans to recruit and organize Muslims in Europe (in Bosnia, Kossovo, the Soviet Union) into special SS military units, into the dread Einsatzgruppen, and into Wehrmacht auxiliary units. The SS Handschar division was made up of Bosnian Muslims and the SS Skanderbeg division was made up of ethnic Albanian Muslims in Kossovo. They all took part in mass murder which Husseini, who had been the British-appointed mufti of Jerusalem, encouraged by making speeches to them, writing pro-Nazi propaganda meant for these Muslim peoples, etc. Husseini spent the war years in Berlin with a headquarters and a stipend from the SS, from Himmler, and an entourage of Arabs from notable families who cooperated in his pro-Holocaust efforts. When Husseini met Hitler in November 1941, he was pleased when the German Fuehrer told him of his intent to extend the Shoah from Europe to the Jews living in Arab countries. Of course, he also supported German occupation of the many occupied countries in Europe. But he was never punished after the war because the major Allied powers did not want to prosecute or punish him. Those powers included the USA, USSR, UK and France.
Anyhow, it is highly ironic as well as hypocritical that Abbas now presents the Palestinian Arabs as victims of  "occupation" that he compares to the Nazi occupation whereas during WW2 the Palestinian and other Arabs were pro-Nazi and supported the occupations and the mass murder of Jews. See this link for a transcript from Husseini's discussion with Hitler in 1941. The post at the link also provides much scholarly work on the Arab-Nazi nexus.
The passage quoted from his speech also contains two other lies but of course we expect from Abbas. 1) there were no "4th of June, 1967 borders." There were only armistice lines which were the outcome of the Arab-initiated war against the emergence of an independent Jewish state, a war that began on 30 November 1947, within hours of the UN General Assembly vote to recommend partition of the country into a Jewish state, an Arab state, and Jerusalem as an internationally ruled enclave.
2) There is no "state of Palestine." This so-called state refuses to negotiate permanent borders with Israel while it does not control all of the territory that was allocated to it by the Oslo accords, since Hamas took Gaza away from the Palestinian Authority and this "state" does not supply state services to its residents despite the billions of dollars and euros that it has received from the European Union, the USA and various other governments. Its water supply and electricity supply are provided by Israel. What the PA does have is support from many Judeophobic Western and Muslim government.
3) Israel does not "occupy" Judea & Samaria which were designated by the San Remo Conference and the League of Nations to be the Jewish National Home on the grounds of the historical connection of the Jews with the Land of Israel, alias "palestine" in Western lingo.

Labels: , ,

Monday, September 21, 2015

Abbas Smears Jews by Claiming Jews' feet Are Dirty

Mahmoud Abbas, alias Abu Mazen, the supposedly pro-peace darling of the EU, the White House, the State Department and an assortment of so-called "Leftists," has gone pretty far insulting Jews this time. He asserted in his frequently bigoted style:
. . . . the 'filthy feet' of Jewish visitors to the Temple Mount desecrate it. . .
A fuller quote has:
“Al-Aqsa is ours and so is the Church of the Holy Sepulchre. They have no right to desecrate them with their filthy feet. We won’t allow them to do so and we will do whatever we can to defend Jerusalem.” [WAFA, PA/PLO press agency]
 This claim of Jews having dirty or filthy feet actually  goes back to medieval Muslim notions and prejudices against Jews which have been upheld in places from Persia [Iran] to Morocco.
In referring to 'filthy feet', Abbas seemed to be quoting a hadith "You must clean your courtyards and do not follow in the footsteps of the Jews"  [here]
Given the extensive laws of cleanliness in the Jewish tradition, the ritual washing of hands before meals, the ritual bathing in the miqveh, etc, this slur from Muslim tradition is a smear reflecting deep prejudice.

Applied to any people but the Jews, such a slur would likely elicit wide disapproval. But since the EU and much of the rest of the West, is now in a deep hate-Israel mood, smears like Abbas' are conveniently overlooked.

The prejudice against Jews as unclean goes farther in the Shiite tradition than even in the Sunni tradition [Abbas is a Sunni]. Consider:
Jewish 'dirt'  was taken to its logical extreme in Sh'ia tradition, where the Jew was najas or impure: To wine and other spirits, dogs, swine, dead animals that were not ritually slaughtered, blood, excrement, and the milk of animals whose meat Muslims are not allowed to eat Shi’a jurists traditionally add dead bodies and non-believers. 
Thus Jews in Iran were not allowed to handle fruit and vegetables in the market, lest they contaminate them, and Jews were even known to have been executed in 19th century Persia for brushing up against Muslims in the rain, thus rendering them impure.
As recently as  2006, Mohamed Ali  Ramin, an adviser to president Ahmadinejad of Iran, said: "Jews are a dirty people. That is why one has accused them throughout history of spreading deadly diseases and plagues*." [here]
Abbas also added his approval to war and violent terrorist acts:
We welcome every drop of blood spilled                                                                  [referring especially to the riots on the Temple Mount]
Is it fair to say that Abbas is bloodthirsty?

Labels: , , , ,

Wednesday, September 16, 2015

Did Zionism Want Oriental Jews?

Link added at bottom 10-6-2015

There has been some discussion over the years as to whether the Zionist movement wanted Oriental [Mizrahi] Jews to take part in the Zionist enterprise. Much is written about Zionism based on ignorance. So we will quote from the writings of two of the theoreticians of Zionism, Leon Pinsker and Theodor Herzl, both of whom wrote their main Zionist works in the 19th century. Whereas Pinsker was more of a theoretician, Herzl actually founded the Zionist Organization in 1897.

Writing in 1882, Pinsker was under the impact of the widespread pogroms/massacres of Jews in 1881in the southwest of the Russian Empire, Ukraine,  after the assassination of the Tsar Alexander II by a so-called "radical revolutionary" group. That same year saw formation of the Lovers of Zion (Hibbat Tsiyon [Zion] or Hovevey Tsiyon [Zion]) groups in that area. 1882 saw formation of the BILU group also in the Ukraine. The BILU actually came to the Land of Israel and settled there, albeit meeting many difficulties. Pinsker was concerned about the welfare of Jews throughout the world, not only in the Russian Empire. He thought that non-Jewish societies could tolerate Jews only in small numbers. In his book of that same year, he wrote:
But there exists, as we have said already, a point of saturation that the Jews must not go beyond under the penalty of finding themselves exposed to the danger of anti-Jewish persecutions, as in Russia, Rumania, Morocco, etc. . . . It is now high time to create a place of refuge . . . [translated from Autoemancipation! Avertissement d'un Juif Russe a Ses Freres (Paris: Mille et Une Nuits 2006), p 63 (emph. added)]
So Pinsker wrote of Morocco as one of the principal places where Jews were threatened with or suffered from persecutions, like Russia and Rumania. And that Moroccan Jews needed and deserved a refuge as the Russian and Rumanian Jews did.  Georges Bensoussan, the editor of a French edition of Pinsker's book, Autoemancipation!   A Warning from a Russian Jews to His Brothers (first ed. 1882) that I have quoted, remarks in a footnote (p 63) that Pinsker should have added the Persian Jews to his list of most threatened Jewish communities. He goes on to point out that two of these countries, Morocco and Persia, "belong to the Muslim sphere," which, he adds, ought to "defang the legend of an Islamic world tolerant overall towards its minorities." The two countries, at opposite ends of the Islamic world, had never been under Ottoman rule, he points out, which was more tolerant, at least towards the Jews. I add that at that time neither country was under European rule and had not been since the Arab conquest of the two countries in the 7th century [Morocco became a French Protectorate in 1912]. Rumania, by the way, a Christian country, had been under Ottoman control until 1878, just four years before  Pinsker wrote his book.

The facts about oppression of Jews in Persia and Morocco ought to have, but have not, "defanged" the legend of Muslim benevolence toward non-Muslim minorities. Why not? That is an important question in itself.

Now back to our subject with Herzl. He himself was of part Ashkenazic and part Sefardic family background, his father coming from a town near Belgrade, Zemun, that had long been under the Ottoman Empire but was no longer when he was born, although the Ottoman border was close by. Rabbi Alkalai who officiated at a synagogue in that town had lived for several years in his childhood around 1800 in Jerusalem and had  some ideas which later turned up in Herzl's own book, The Jewish State. Herzl was born in 1860, so we can assume that his father and grandfather were living in that town, Zemun, before he was born and knew of Rabbi Alkalai's ideas. Below is a description of Herzl with mention of his intent to negotiate the orderly departure of Jews from various Diaspora countries, including Algeria, then part of France, since 1830, where the persecution of Jews was acute, especially during the Dreyfus Case which was taking place around the time that he wrote The Jewish State. In Algeria, Jews were persecuted both by Arab Muslims and by French and other European settlers. Today's currently fashionable ideology of Third Worldism sees European Settlers and Arab "natives" in Algeria as irremediably opposed. But they could and did find common cause against the Jews, as much (or more) native to the country as the Arabs (the Arab conquest took place in the 7th century. Jews were there long before.):
Herzl was primarily a man of action who wished to translate his ideas into reality. His basic premise, that Zionism constituted an effective antidote to antisemitism, led him to the conviction that the countries most plagued by this problem were his potential allies. As early as June 9, 1895, he jotted down in his diary, "First I shall negotiate with the Czar regarding permission for the Russian Jews to leave the country … Then I shall negotiate with the German kaiser, then with Austria, then with France regarding the Algerian Jews, then as need dictates." [see here]
That was Herzl's diary, Here is a passage from his book, The Jewish State. He mentions the dangers to Algerian Jews near the beginning of Chapter 2:
Attacks [on Jews- note by Eliyahu] in Parliaments, in assemblies, in the press, in the pulpit, in the street, on journeys—for example, their exclusion from certain hotels—even in places of recreation, become daily more numerous. The forms of persecutions varying according to the countries and social circles in which they occur. In Russia, imposts are levied on Jewish villages; in Rumania, a few persons are put to death; in Germany, they get a good beating occasionally; in Austria, Anti-Semites exercise terrorism over all public life; in Algeria, there are travelling agitators; in Paris, the Jews are shut out of the so-called best social circles and excluded from clubs. Shades of anti-Jewish feeling are innumerable.
Obviously, the claim is false that Zionism was founded with the intention of excluding Jews from Oriental countries.
- - - - - - - - - - - - - - - - -
Added 6 October 2015-- Shmuel Trigano discusses why Jews left the Arab countries. [here]

Labels: , , ,

Sunday, August 30, 2015

Do US Think Tanks Violate US Law Mandating Registration of Foreign Agents?

It is no secret that many area studies centers and institutes specializing on the Middle East (or other subject areas for that matter) at American universities are subsidized by some of those that they are supposed to study. That is, by super-rich Arab oil kingdoms and sheikdoms, especially on the Persian Gulf. But it is not only the university-based Middle East studies centers that are funded by Arabs and their friends, it is many of those Washington think tanks. The first institute in the United States specializing on the modern Middle East was likely the Middle East Institute located in Washington, long funded by friends of the Arabs, a large part of the US petroleum industry, and still going strong. Iran too has its own lobby in Washington, DC, especially but not only in the NIAC [see previous blog post]. Jan Sokolovsky asks whether any of the respected think tanks [perhaps wrongly respected] that infest DC are violating US law by not registering as foreign agents under the FARA, foreign agents registration act. Here is her article:

Do Major Think Tanks Violate US Law?

Prominent American research organizations may have violated the Foreign Agents Registration Act, (FARA), by failing to register and to disclose lavish donations they have received from foreign governments, as documented in a recent major report in the New York Times, “Foreign Powers Buy Influence at Think Tanks”, by Eric Lipton, Brooke Williams and Nicholas Confessore. Such funding by foreign governments, especially when not disclosed, is extremely detrimental to the interests of the United States, since their goal is to influence our policies.
 “More than a dozen prominent Washington research groups have received tens of millions of dollars from foreign governments in recent years while pushing United States government officials to adopt policies that often reflect the donor’s priorities.”
Although receipt of such funding is not illegal, failure to report it is.
“The think tanks do not disclose the terms of the agreements they have reached with foreign governments.  And they have not registered with the United States government as representatives of the donor countries, an omission that appears, in some cases, to be a violation of federal law, according to several legal specialists who examined the agreements at the request of the Times”
FARA requires registration and disclosure by persons who are funded by foreign nations if they engage in “political activities” which is defined as an attempt to influence public opinion or any part thereof, in the United States on matters of policy.  That is precisely what these think tanks do, as Martin Indyk of the Brookings Institute explicitly states in this article. “Our business is to influence policy with scholarly, independent research, based on objective criteria, and to be policy-relevant, we need to engage policy makers,” said Indyk. To assume that the researchers and the think tanks are not influenced by the agenda of their donors belies common sense.
Norway, Japan, Qatar and the United Arab Emirates are among nations identified as heavy donors to these think tanks

Indyk’s problematic role as an envoy of the United States to Israel during the early stages of its campaign against Hamas in Gaza, Protective Edge, is a perfect example of conflict of interest, because of the financial role of Qatar.   At that time, Indyk was the Vice President and director of foreign policy for Brookings; Qatar gives extensive support to both Brookings and Hamas.
Qatar is widely accepted to be Hamas’ main financial backer.   The New York Times reported that Qatar gave Brookings $14 million, making Qatar also its largest donor.  Neither Brookings nor Indyk disclosed this financial connection during Protective Edge.
The entire purpose of the FARA law is to ensure transparency when foreign nations try to influence American policy.  Unfortunately, no reference to Qatar was found either on the Brookings website or in its annual report. From the NYT article, one may reasonably infer that the same invisibility is true for donations from foreign governments received by the other think tanks.
Shortly before Attorney General Eric Holder announced his imminent resignation, he ordered investigations into the Ferguson, Missouri police department, and domestic violence within the ranks of the NFL.  As important as these issues are, it is incumbent upon his soon to be appointed successor to promptly initiate an investigation into the funding of major research organizations by foreign nations. Clearly, there is ample cause for the Justice Department to open an investigation promptly into violations of FARA both by these institutions and the individuals involved, and if warranted by their findings, to commence judicial proceedings to impose the full extent of the civil and criminal penalties provided.

Labels: , ,

Monday, August 24, 2015

Obama Pressured Europeans to Give in to Iran on the Nuclear Deal

Shocking news from the Wall Street Journal. It has long been known that France was much more concerned over an Iranian nuke than Washington was. Nicolas Sarkozy when he was president even made a speech about Iran as a problem at the UN General Assembly [see here about Iranian insults & threats to Sarkozy's wife]. Now we find out this:
One of the toughest of the country’s hard-nosed security experts, Bruno Tertrais, wrote last month in the Canadian newspaper Le Devoir that “with pressure from the Obama administration” European negotiators’ original intent deteriorated from a rollback of Iran’s nuclear ambitions to their containment. [John Vinocur in the Wall Street Journal, 24 August 2015]
So Obama's administration pressured the  supposed "Western allies" of the USA to go easy on Iran and give in to Iranian demands rather than forcing Iran to give in to Western demands, through sanctions for instance. Moreover, Obama's Iran nuke deal is:
. . . . what France knows is a lousy Iran nuclear deal. [same article, John Vinocur in the Wall Street Journal, 24 August 2015]
A French negotiator at the P5 + 1 talks with Iran was one Jacques Audibert. He met two American congressmen visiting France and told them that if Congress voted down the deal it would most likely NOT mean war. Rather, congressional disapproval of the deal would likely lead to renewed negotiations and a better deal. Here is the story from Bloomberg:
Secretary of State John Kerry has been painting an apocalyptic picture of what would happen if Congress killed the Iran nuclear deal. Among other things, he has warned that “our friends in this effort will desert us." But the top national security official from one of those nations involved in the negotiations, France, has a totally different view: He told two senior U.S. lawmakers that he thinks a Congressional no vote might actually be helpful.
His analysis is already having an effect on how members of Congress, especially House Democrats, are thinking about the deal.
The French official, Jacques Audibert, is now the senior diplomatic adviser to President Francois Hollande. Before that, as the director general for political affairs in the Foreign Ministry from 2009 to 2014, he led the French diplomatic team in the discussions with Iran and the P5+1 group. Earlier this month, he met with Democrat Loretta Sanchez and Republican Mike Turner, both top members of the House Armed Services Committee, to discuss the Iran deal. The U.S. ambassador to France, Jane Hartley, was also in the room.
According to both lawmakers, Audibert expressed support for the deal overall, but also directly disputed Kerry’s claim that a Congressional rejection of the Iran deal would result in the worst of all worlds, the collapse of sanctions and Iran racing to the bomb without restrictions.
“He basically said, if Congress votes this down, there will be some saber-rattling and some chaos for a year or two, but in the end nothing will change and Iran will come back to the table to negotiate again and that would be to our advantage,” Sanchez told me in an interview. “He thought if the Congress voted it down, that we could get a better deal.”
. . . . . . . .
Audibert's comments as recounted by the lawmakers are a direct rebuttal to Kerry, who in remarks to the Council on Foreign Relations on July 24 said that if Congress voted down the deal, there would no chance to restart negotiations in search of a tougher pact. Kerry also said that Congressional rejection of the Iran deal would erode the U.S. credibility to strike any type of international agreement in the future. “Do you think the Ayatollah is going to come back to the table if Congress refuses this and negotiate again? Do you think that they're going to sit there and other people in the world are going to say, hey, let's go negotiate with the United States, they have 535 secretaries of State?” Kerry said. “I mean, please.”
This argument is being echoed by a throng of U.S. commentators and former Obama administration officials who support the deal. . . . . .
Audibert also wasn’t happy with some of the terms of the deal itself, according to Sanchez and Turner. He said he thought it should have been negotiated to last forever, not start to expire in as few as 10 years. He also said he didn’t understand why Iran needed more than 5,000 centrifuges for a peaceful nuclear program. He also expressed concerns about the robustness of the inspections and verification regime under the deal, according to the lawmakers. . . . .
When the lawmakers returned to Washington, news of their conversation with Audibert spread among their colleagues. Turner confronted Kerry with Audibert’s statements during a July 22 closed-door briefing with Kerry and more than 300 House lawmakers. The briefing was classified, but Turner’s questions to Kerry were not.
“Are you surprised Jacques Audibert believes we could have gotten a better deal?” Turner asked Kerry, according to Turner.
“The secretary appeared surprised and had no good answer as to why the national security adviser of France had a completely different position than what the secretary told us the same day,” Turner told me.
Sanchez was not at that briefing, but since then, many lawmakers have asked her about the information, especially Democrats, she told me. “It’s one piece of information that people will use to decide where they are,” she explained. [Josh Rogin, Bloomberg,  31 July 2015]
- - - - - - - - - - -
France's position before capitulating to Obama administration pressure [here]

Saudi Arabia's stance against an Iranian nuke was clear but disregarded by Obama, as was Israel opposition [go to link and go down toward the bottom].

Italian Middle East expert, Carlo Panella, foresaw in 2009 that Obama and his crowd would capitulate to Iran on the nuclear issue [here]

Labels: , , , ,

Sunday, August 23, 2015

Beware of Obama's Stage Shows in Support of His Iran Deal - Watch for His Ventriloquist's Dummies

revised 8-24-2015

Barack Obama's political career has been marked by putting on shows to win over the public plus artful rhetoric and purple prose to mesmerize those who may have trouble thinking for themselves. Obama's great rhetorical, oratorical and thespian talents have allowed him to consolidate a hard core of devoted supporters who may have been educated in American universities but never learned to think for themselves. And are largely lacking in information. Obama and his staff rely on appeals to emotion and lofty values in order to promote his often harmful policies. They succeeded a great deal. Which is a great pity. Because they have swindled the American people in many ways. Just think of: If you like your doctor, you can keep your doctor.

Even more threatening than Obama's medical care program that lessens medical care for more people than are helped by it is his Iran deal. I don't want to go into detail about the lack of independent, outside verification of Iran's nuclear facilities, the Iranian violation of their commitments to the Nuclear Non-Proliferation Treaty (NPT), the 10 to 15 year expiration term of the restrictions supposedly imposed by the deal [that is, if Iran doesn't cheat and get a  bomb beforehand], the 100 to 150 million dollars that Iran will get to pursue its bloody mischief in other Middle Eastern countries (not only Israel, but Libya, Sudan, Yemen, Syria, Iraq) and other important defects in deal. Since rational and knowledgeable and reasonable people recognize the problem with the deal, the problem becomes how to stop it and what techniques Obama will use to push it through. Watch  what Obama does as if he were a magician. What does he do with his left hand while pointing into the distance with his right hand??:

Kyle Shideler warns that Obama will stage shows in order to play on the public's emotions and have the people support a deal that is against their own interests. His article is entitled:

Americans Should Be Wary of Carefully Managed Productions Supporting Iran Deal

Kyle Shideler | Aug 19, 2015 [townhall.com]

Recently, three-dozen retired flag and general officers endorsed the Obama administration’s controversial Iran Deal. The Washington Free Beaconreported that former Rear Admiral James “Jamie” Barnett, an employee of the law firm and lobbying group Venable LLP, organized the letter.
Barnett, who took credit for producing the letter, told the Free Beacon that the White House played no role, despite that Barnett’s letter says, “I am working with the White House on a letter for retired General Officers and Flag Officers to sign, supporting the U.S.-Iran accord on nuclear armament.“
Adm. Barnett’s support for the deal is not necessarily surprising. Barnett has repeatedly taken public positions on military or national security related issues that align closely with those of the Obama White House, including opposition to “enhanced interrogation techniques,” in favor of changes to DOD’s Transgender policy, and applauding the use of national security as a reason to support school lunch changes proposed by First Lady Michelle Obama. In his capacity as a Venable employee, Barnett also worked a high profile case on sexual abuse in the military during a period at a moment when the White House was seized with the topic.
Barnett solicited signatures for the letter from his Venable work email, but denies that his employer played any role in the letter.
Given that Barnett had denied what appears to be obvious White House involvement, his other denial seems worthy of further investigation as well. Is there reason to believe that the firm has an interest in ending Iran sanctions?
Most immediately apparent is Venable’s close association with the Public Affairs Alliance of Iranian Americans (PAAIA), an Iranian-American group, with its own political PAC. PAAIA is listed as one of Venable’s Non Profit Clients. PAAIA isopenly working in favor of the Iran Deal, and signed a joint statement with the National Iranian American Council (NIAC), a group with long-established ties to the Iranian regime. One of PAAIA’s “Founding Donors” was Venable Partner Robert S. Babayi.
Babayi is also the co-founder of the Iranian American Bar Association (IABA). Venable held presentations for the IABA on Iranian Americans living in or doing business in Iran and Iran sanctions laws. In March of 2010, IABA screened the anti-Guantanamo Bay detention facility movie “The Response” which was executive produced by Venable LLP. Venable represented Egyptian detainees at Guantanamo (the subject of the film), and Babayi’s email is listed as the RSVP email.
Babayi apparently left Venable to become Managing Director of Vector IP, a boutique Patent law firm in June 2014. Babayi is also a U.S. Advisory Team member for IBridges, an organization that works to promote High Tech entrepreneurship in Iran.
Venable may also have other interests in Iran . . . . [for full text go here]
 - - - - - - - - - - - -
After making the horrendous and fateful Munich Pact with the Nazi Hitler, UK prime minister Neville Chamberlain came back to Britain saying: peace with honour. . . . peace for our time. Obama stopped making what seemed to most people an outlandish promise of peace emerging from his Iran deal. Now he puts it differently. He claims that the only alternative to his Iran deal is war and that a better deal is not and was not possible. Perhaps he is implying that his Iran deal represents something between war and peace. A cold peace or a cold war perhaps, or maybe just a lot of limited wars that Iran will initiate against its neighbors in the Middle East but not against the United States. Meanwhile, Obama is insinuating that the opponents of his deal are warmongers and he openly said at American University in Washington, DC, that the only country that had openly commented on the deal but had not praised it was Israel. Literally that might be true if we only consider official declarations by rulers, top officials and foreign ministries. But the insinuation was that Israel was a warmongering power that might not know its own best interest. In fact, many Arab powers, including Saudi Arabia, have been very strongly opposed to the deal but fear to challenge the White House. Obama knew that when he made his speech but he considered it useful to insinuate that only Israel opposed the deal. Indeed, Saudi Arabia went so far in opposing Obama's long obvious efforts to appease Iran and leave it with its nuclear program as to allow Anwar Eshki, a former general, to appear jointly with Dore Gold, now the director-general of Israel's foreign ministry, before the Council on Foreign Relations in Washington in order to show the common Israeli-Saudi opposition to the weak nuclear taking shape.
- - - - - - - - - -
To get some idea of how Obama thinks, consider the words of Don Juan in Molière's play of that name [here/ici]

Labels: , , ,

Wednesday, July 29, 2015

The Greek Crisis Shows the Stupidity of the Euro Currency Itself

Just a few thoughts that I have about the Greek debt crisis which is a crisis of the euro currency and the Eurozone itself.

Greek mismanagement of its state finances was a problem. But the main problem is the notion of the single currency itself. The euro was a bad idea whose time had come. The economic disparities between the member states of the eurozone were great, not to mention lack of a common tax system, pension system, state budget, labor laws, etc etc, plus Greece's special defense needs vis-a-vis Turkey, etc.
What happened to Greece was inevitable and could have happened to other eurozone states. After the Greek debt crisis became known in 2010 it was handled all wrong by the Eurozone which insisted on reforms --due to German domination--- rather than debt relief which at that time could have taken the form of eurobonds at a low interest rate which Greece could have paid at that time. Instead Greece was left to borrow for regular needs --as many countries, including the USA, do-- on the open market where interest rates on Greek debt inevitably shot up, and that should have been foreseen. So the Greek debt is much higher today than 5 years ago. And that is the fault of the eurozone, especially Germany/Schaeuble/Merkel etc.
Reforms yes, but not without an easy credit facility plus funds for investment in growth. Lebowitz is right but does not go far enough. Greece has offshore energy resources which Europe needs and could have invested in in order to help both Greece and the EU as a whole. But instead of funds for growth there was excessive austerity which destroyed rather than creating conditions for growth and getting out of the debt straitjacket

Labels: , , , ,

Monday, July 20, 2015

John Kerry Lies to the Media and Public about the Surrender to the Ayatollahs' Destructive Nuclear Urges

We know that Obama is an artist of smooth, well-spoken lies. I cannot think of anybody who lies so well with a straight face. But secretary of state John Kerry lies too, albeit not as smoothly as his boss.

The fact is that Iran is in violation of the Nuclear Non-Proliferation Treaty [NPT] signed years ago. Rather than negotiating with Iran, the USA and other states in the P5+1 group should have been working to force Iran to comply with its obligations under the NPT. But as we know Obama and other politicians wanted to negotiate with Iran over its nuke bomb endeavors. In this case, negotiating means compromising on the original provisions of the NPT.  The nuke deal with Iran from last week also excuses Iran from compliance with previous UN Security Council resolutions, as we see below.

Omri Ceren, one of the good guys in the fight against the Iranian nuke project, took up Kerry's brazen lies on the US Sunday news interview shows. Omri sent this around as a fact sheet for the Israel Project where he works. The problems are not only Iran's nuke project. Consider item 2) below and bear in mind that Iran has been developing long-range ballistic missiles [ICBMs intercontinental ballistic missiles] the better to deliver any future bomb and not just on Israel:

The administration is scrambling to justify collapsing on conditions related to the three overarching areas of the JCPOA [= Joint Comprehensive Plan of Action] debate:
1) will it work to keep Iran away from a nuclear weapon for a decade (the verification debate); 
2) even if it works, is it worth the cost of empowering Iran with advanced weapons and hundreds of billions of dollars (the arms embargo debate);
3) doesn't the deal make Iran into a nuclear power – the opposite of what it was supposed to do – because it expires and allows Iran's breakout time to go to zero (the sunset clause debate).
. . . . .
By far the most unexpected concession made at Vienna involved the Americans bowing to new Iranian-Russian demands to eliminate the United Nation arms embargo. Restrictions on conventional weapons will now expire in 5 years and ones on ballistic missiles will expire in 8 years. The collapse - which has been wrapped into how Iran is also receiving a short-term $150 billion windfall and long-term sanctions relief - was discussed on every one of the Sunday shows [a][b][c][d][e].

Kerry and Moniz had three different responses sprinkled across the shows: (1) that the administration had no choice but to concede on the arms embargo, and it was actually an American diplomatic victory because it's being phased out rather than lifted immediately (2) that dropping the arms embargo doesn't matter - "a mountain is being made out of a mole hill" - because there are other restrictions on Iranian arms transfers (3) that Iran won't get sufficient relief to exploit the arms embargo being lifted.
(1) The administration had no choice but to concede on the arms embargo, and it was actually an American diplomatic victory because it's being phased out rather than lifted immediately -
ABC This Week
KERRY: The United Nations resolution which brought about the sanctions in the first place said that if Iran will suspend its enrichment and come to negotiations, all the sanctions would be lifted. Now, they've done more than just come to negotiations. They've actually negotiated a deal. And three of the seven nations thought they shouldn't therefore be held to any kind of restraint. We prevailed and insisted, no, they have to be.

CBS Face the Nation
KERRY: ... [T]he reason that we were only able to limit them to the five and eight, which is quite extraordinary that we got that, was that three of the nations negotiating thought they shouldn't have any and were ready to hold out to do that. And we said under no circumstances, we have to have those...

Fox News Sunday
KERRY: This is a nuclear negotiation about a nuclear program. The United Nations, when they passed the resolution, contemplated that if Iran came to the negotiation and they ponied up, all the sanctions would be lifted. We didn't lift all the sanctions. We left in place despite the fact that three out of seven countries negotiating wanted to do away with them altogether. We won the five years for the arms and eight years for the missiles.

CNN State of the Union
KERRY: ... [T]his UN process that started the – that allowed the sanctions to be put in place in the first place contemplated the lifting of all sanctions once Iran had lived up to its obligations with respect to the NPT. So if the IAEA found in X number of years that they've lived up to this, then all the sanctions would be gone. So we, in fact, succeeded against three countries that didn't think they should have to do anything.

NBC Meet The Press
KERRY: And by the way, even though the arms and the missiles were put to – by the – they were thrown in as an add-on to this nuclear agreement. It was always contemplated that if Iran did come and deal on their nuclear program, that was going to be lifted.
This claim is false on at least a couple of levels. First, the condition for lifting the arms embargo was not that Iran "come to negotiations." UNSCR 1929 stipulated that the embargo was to remain in place until Iran had complied with UNSCR 1929 plus past UNSCRs 1696, 1737, 1747, and 1803 ([f] - ctrl-f down to "to persuade Iran to comply with resolutions"). The UNSCRs obligated Iran to stop all uranium enrichment, cease all heavy water plutonium work, and halt all development of proliferation sensitive ballistic missiles. So the arms embargo was to remain in place until Iran dismantled its nuclear program, not until it agreed to negotiate.

Second, there was nothing forcing U.S. to agree to lift the embargo. The JCPOA allows Iran to continue doing all of the activities prohibited by previous UNSCRs. The Americans could and should have argued that Iran was already receiving a Get Out Of Jail Free Card on its UNSCR obligations via sanctions relief, and that there was no reason to also gift them with the removal of the arms embargo.

(2) Dropping the arms embargo doesn't matter - "a mountain is being made out of a mole hill" - because there are other restrictions on Iranian arms transfers -
ABC This Week
KERRY: But we have ample other resolutions that allow us to hold them accountable for moving any weapons. President Obama is committed to doubling down on the enforcement of those measures. So I really think that a mountain is being made out of a molehill here.

CBS Face the Nation
KERRY: ... [T]hey add on to additional mechanisms that we have to hold them accountable on arms and missiles. We have the missile control technology regime. We have other missile restraints on them. We also have other UN resolutions that prevent them from moving arms to the Houthi, prevents them from moving arms to the Shia, prevents them from – to the Shia militia in Iraq, prevents them from moving arms to Hizballah.

CNN State of the Union
QUESTION: ... Why is lifting the embargo part of this deal?
KERRY: Well, we're not lifting it. It has eight years out of a 10-year component of the UN resolution. Eight years it will be applied, and we have other UN resolutions and other mechanisms for holding Iran accountable on missiles.

Fox News Sunday
KERRY: But we have many other sanctions still applicable, and we can bring other sanctions to push back against any of their behavior. They're not allowed to send arms to Hizballah. That's a separate resolution. They're not allowed to send arms to the Shia militia in Iraq. A separate resolution. They're not allowed to send arms to the Houthis. Separate resolution. So we, in fact, have a huge ability to be able to bring any number of efforts against Iran for any bad behavior here whatsoever.
This claim is misleading because the JCPOA will make it functionally impossible to reimpose economic pressure on Iran, regardless of what laws remain on the books [g]. 
Paragraph 25: "If a law at the state or local level in the United States is preventing the implementation of the sanctions lifting as specified in this JCPOA, the United States will take appropriate steps... with a view to achieving such implementation." 
Paragraph 26: "The EU will refrain from re-introducing or re-imposing the sanctions that it has terminated implementing under this JCPOA... The United States will make best efforts in good faith to sustain this JCPOA and to prevent interference with the realisation of the full benefit by Iran of the sanctions lifting specified in Annex II." 
Paragraph 29: "The EU and its Member States and the United States, consistent with their respective laws, will refrain from any policy specifically intended to directly and adversely affect the normalisation of trade and economic relations with Iran inconsistent with their commitments not to undermine the successful implementation of this JCPOA."

The punchline is the very last line of the very last paragraph of the main agreement, which gives Iran its own snapback mechanism against the United States by allowing it to return to enrichment if sanctions are even partially reinstated. 
Paragraph 37: "Iran has stated that if sanctions are reinstated in whole or in part, Iran will treat that as grounds to cease performing its commitments under this JCPOA in whole or in part." Maybe the administration will say that the passage was only intended to refer to nuclear sanctions. That's not how it's written, and the Iranians have a 100% success rate of winning interpretation debates vs. the Americans over vague language in agreements and factsheets.

(3) Iran won't get sufficient relief to exploit the arms embargo being lifted
Fox News SundayQUESTION: Under this deal, we lift the arms embargo on Iran being able to buy weapons and even ballistic missiles between five and eight years. And the sanctions against General Soleimani, head of the Iranian Revolutionary Guard's Qods Force, are also lifted. What we end up with, Secretary Kerry, is an Iran with billions, hundreds of billions of dollars more, able to buy weapons, and a Revolutionary Guard with fewer restraints. Isn't that potentially an even more dangerous state sponsor of terror in the Middle East?
KERRY: First of all, Chris, don't exaggerate. It's not hundreds of billions of dollars. It's $100 billion.
QUESTION: That's in the first year.
KERRY: But – it's their money that they have had frozen.
QUESTION: I understand. But it's a hundred --
KERRY: Well, let me – but let me just finish.
QUESTION: A hundred fifty billion is the first year.
KERRY: Please. Chris, this is not supposed to be a debate. You're supposed to ask a question and we're supposed to be able to answer it.
This is a strange stance to take. The $100 - $150 billion windfall will occur within months of the deal being implemented, but while that happens the sanctions regime will be shredded, allowing the Iranian economy to skyrocket to the tune of hundreds of billions of dollars. The lifting of economic sanctions will trigger a gold rush into Iran [h]. The administration used to claim that worries over Iranian noncompliance would dampen enthusiasm - because no company wants to enter the market if they have to leave a year later - but the final JCPOA has a loophole so snapback doesn't apply to companies that set up shop in Iran before noncompliance [i]. Snapback is a fiction anyway [j]. Meanwhile the delisting of banks will remove the last economic lever that the West has over Iran, and those financial sanctions are never coming back [k].
- - - - - - - - - - - - - END of Omri Ceren's Factsheet for The Israel Project - - - - - - - - - - - - - - - - - - - - - - 

Once upon a time, the so-called "Left" opposed nuclear proliferation. Cathy Ashton, the mentally challenged former commissioner of foreign affairs for the EU commission, had even been a hired employee of the British supposed anti-nuke outfit, the Campaign for Nuclear Disarmament. Then when she started work with the EU and negotiated with Iranian representatives she became in fact an agent of nuclear proliferation and was effectively scoffing at the principle of nuclear disarmament. Obama is identified with the "Left" but we don't know anymore what those terms, left and right, mean. In the 1950s, officials of the Republican Eisenhower administration were quite complacent about nuclear weapons and "peaceful uses of atomic energy." Nowadays, the so-called "Left", led by Obama is actively facilitating nuclear proliferation to Iran and indirectly provoking Sunni Arab states like Saudi Arabia and Egypt to set up or restart their own nuclear programs [as in Egypt's case] as a defensive measure against Iran. Hence, Obama is instrumental in bringing  about a dread nuclear arms race. And Obama and his minions have the hhutspah to insinuate that opponents of the nuke deal with Iran are warmongers. 
- - - - - - - - - - - - - -
Former Saudi ambassador to US chides Obama for making the nuke deal with Iran which he indicates is worse than Clinton's nuke deal with North Korea. [here & here]
For those who are not aware, Saudi Arabia has been consulting with Israel for some time now in trying to work together to counter Obama's pro-Iran nuke deal, despite all of the other issues that divide the two countries.

Labels: , , ,

Sunday, July 05, 2015

Germany benefitted from debt relief but it is ruled out when for Greece's benefit

UPDATING 7-13-2015 at bottom

The Greeks are still voting on the referendum whether or not to accept proposals by the creditor institutions for getting another tranche [slice] of loan money to pay off previous loans. Note that Greece was not offered money to finance growth, such as in developing Greece's off shore hydrocarbon deposits. Greece is being offered money to pay previous debts to those who are offering new loans. So Greece is in a vicious circle or trap.

The help that Greece needs is debt relief and funds to aid growth and development. Indeed, former Italian Prime minister Berlusconi --interviewed yesterday [by TG com 24]-- wished Greece to have a future of growth and sviluppo [= development]. But the creditor offers to Greece did not include aid for growth, without which Greece cannot pay off old loans in the future. Instead, they insist that old loans be paid. Debts must be paid is the principle that they pretend to uphold. But how short are their memories, especially those of the Germans!!!

After the general destruction caused by WW2, a German war, in all the countries attacked, and in Germany itself as well, West Germany, occupied by the USA, UK, and France, was loaned $15 billion in Marshall Plan money when a billion dollars was worth much more than today. All but a small part of that loan was forgiven and the rest stayed in Germany as so-called counterpart funds which were used by the USA to finance projects in Germany to help Germany. Moreover, under US leadership, the formerly German-occupied countries agreed to forego reparations payments. They gave up on their demands for compensation from Germany for material damages. Peter Coy describes the spirit of US policy:
On Sept. 6, 1946, U.S. Secretary of State James Byrnes gave a speech in Stuttgart, Germany. A movement was afoot to penalize the Germans for their role in World War II by deindustrializing the country. Byrnes opposed anything resembling economic spite and promised the country a fair chance to rebuild. “Germany is a part of Europe,” Byrnes said, “and recovery in Europe will be slow indeed if Germany with her great resources of iron and coal is turned into a poorhouse.” It became known as the Speech of Hope. [Peter Coy in BloombergBusinessWeek]
Greece too was led by the US to give up its demands for compensation as well as for return of gold reserves and forced loans taken by the German occupation army from the Greek state central bank.
Hence, we see that Germany enjoyed and benefitted from debt forgiveness after the vast destruction caused by WW2. But today Greece must not benefit from debt forgiveness nor even from debt restructuring to extend pay back periods and/or to reduce interest on old debt.

What's more nobody seems to want to recall that after WW One, also a German war, Germany agreed to pay reparations to France. The sum was huge and it seemed so to the German governments in the 1920s.  So what did the German govts of the time do to alleviate their debt, that is, to get debt relief?
They devalued their own currency, the deutschemark, and the French were paid off in cheap, nearly worthless deutsche marks. Greece cannot do that since its debt is denominated in euros and Greece's govt does not control the value of the euro which it cannot devaluate by its own decision.

Here is another example of how Germany benefitted from debt relief which it rules out when it is for the benefit of Greece. And the other major countries in the Eurozone go along with the present absurdity of creditors trying to squeeze blood from a stone.

Can Israel expect any humane treatment from diamond-hearted, self-righteous hypocritical Europeans?
- - - - - - - - - - - - - -
Also see links below:
European Union knows what is best for everybody else but cannot or does not want to solve some of its own problems. [here]
Eurozone is stingy with Greece, generous with Arabs claiming the Land of Israel [here]
Eurozone betrays its Greek Eurobrethren. What would they do to the Jews? [here]
Why Greece should vote No [here].
Was it deliberate policy to impoverish Greece by putting it into a debt straitjacket? [here]
See analysis by Committee for Abolition of Third World Debt towards bottom of link [here]
- - - - - - - - -
UPDATING 7-13-2015 Investment fund manager David Einhorn sees political motives in the
Eurozone working to have Greece fail even if it hurts the rest of the Eurozone.
David Einhorn, founder of Greenlight Capital, said Europe’s leaders are prepared to let Greece fail to discourage other countries from electing populists.
“Europe is unwilling to allow Syriza a face-saving compromise, even if that means Greece collapses and the rest of Europe suffers” [Bloomberg here]

Labels: , , ,

Friday, July 03, 2015

The Eurozone Put Greece in a Debt Straitjacket - Was It Deliberate?

It's obvious to almost everybody that the Eurozone never "rescued" or "bailed out" Greece from its debt crisis in 2010. Instead, the Eurozone or Eurogroup put Greece into a debt straitjacket or debt trap in which Greece's state debt soared because it was left to borrow on the open market where the interest rates demanded by private investors/lenders were sure to rise fast. Later, but too late, it was openly realized  --about 2012-- that Greece needed to borrow on easy terms because its state debt was soaring. But Greece was already in the debt straitjacket or trap from which it cannot get out. Someone estimated that it would take 180 years for Greece to pay off the debt mountain.

Now evidence has emerged that suggests --not absolute proof to be sure, which is not likely to emerge for many years-- that putting Greece into a debt trap may have been deliberate German policy. The purpose seems to have been to use the Greek example as a whip to scare other economically weak Eurozone member states. German finance minister Wolfgang Schaeuble is quoted as telling US secretary of the Treasury, Timothy Geithner, as reported by Peter Coy of Bloomberg Businessweek:
The upshot is that events are unfolding roughly as foreseen by the wily German finance minister, Wolfgang Schäuble: The disaster befalling Greece is scaring other European nations into following the straight and narrow. According to former Treasury Secretary Timothy Geithner in his book Stress Test: Reflections on Financial Crises, Schäuble told him in 2012 that—in Geithner’s words—some people were arguing “that letting Greece burn would make it easier to build a stronger Europe with a more credible firewall.”

This surmise of mine explains a lot, if true. Why do Germany and the Eurozone keep on insisting that Greece pay off debts made at inflated interest rates, debts which it cannot pay off for more than a century?
- - - - - - - - - -
Also see here, and below --
The economist Paul Krugman pointed out that Greece was in: "a vicious circle, with fears of default threatening to become a self-fulfilling prophecy."  here. Interestingly, former Italian prime minister, Silvio Berlusconi, also pointed out that Greece was in a "vicious circle" that it should be helped to get out of. He favored mutualization of state debt within the Eurozone.
European hypocrisy about human rights according to Michael Rubin on the Commentary blog, "The Lie that Europe Cares about Human Rights"  [here]

Labels: , , , , ,

Friday, June 12, 2015

More European Greed, Failure & Hypocrisy: The Greek Case

We are all familiar with the moral pretensions and pretenses of Europe, particularly the European Union which embodies Europe's flaws quintessentially. They seem to know what is right for everybody else in the world, especially for Israel and the Jews. Just listen to us and you will have peace, they tell us. Why we should listen to them is beyond me, since I am old enough to remember that the Nazi Holocaust was perpetrated not just by Germans and Austro-Germans but was aided by most of Europe (by Arabs too but we're not talking about Arabs). Think of Quisling Norway and Vichy France and so on and so forth. Europe's world championship in hypocrisy is solid and unchallenged, as this Irish example bearing on Israel demonstrates. But even more striking is how the European Union  treats some of its own who appear to belong to a lesser class of Europeans.

The EU has never threatened Turkey with any sort of boycott for its occupation of northern Cyprus, whereas Cyprus, predominantly Greek ethnically, is a member of the EU itself. But there is obviously a lot of business to be done with Turkey or maybe the Greek Cypriots are just Europeans Grade B. Their brothers and sisters in Greece, also an EU member and a NATO member, suffer from counterproductive Eurozone schemes for settling their debt crisis. The Eurozone, a subsidiary comprising most EU members, imposed on Greece a terribly dysfunctional austerity plan that guarantees to keep most Greeks in poverty and does not encourage growth.

Anyhow Philippe Legrain in Foreign Policy updates some of the things that I and many professional economists have been saying for years [although I am not a professional economist, some big flaws in the "remedy" for Greece have been much too obvious]. Whatever the flaws in the economic plans to "help" Greece, their proposals for the Middle East  would work just as badly or worse if Israel adopted their plans to "help bring peace" to the Middle East. Here is Legrain:

Why Greece Should Reject the Latest Offer From Its Creditors

Why Greece Should Reject the Latest Offer From Its Creditors
Reform — Greece sorely needs it. Cash — the government is running desperately short of it. So it is time for Prime Minister Alexis Tsipras to do what’s best for Greece and accept its creditors’ reform demands in exchange for much-needed cash. That is how the Greek situation is usually framed. It is utterly misleading.
Imagine you’re in prison for not being able to pay your debts. (You’re right, it’s almost unthinkable — civilized societies no longer lock up bankrupt individuals. But bear with me.) After five years of misery, you lead a rebellion, take control of the prison, and demand your release. The jailers respond by cutting off your water supply. Should you back down and return to your cell, perhaps negotiating for slightly less unpleasant conditions, in order to obtain a little liquidity? Or should you keep fighting to be free? That, in essence, is what the standoff between an insolvent Greece and its eurozone creditors is really about.
For months, Greece has had “only days” to agree a deal with its creditors before it runs out of cash. Eventually that will be true. But even if Tsipras accepted the creditors’ demands, Greece would still have “only days” before it ran out of cash. The 7.2 billion euros on offer right now wouldn’t even cover the Greek government’s debt repayments until the end of August. And for a measly two months of liquidity, Tsipras is expected to surrender his democratic mandate: break his election promises, agree to yet more tax increases and spending cuts that would depress Greece’s economy further, and relinquish his demands for debt relief.
Then the wrangling would start again. Because so long as Greece remains in its debtors’ prison, it will be dependent on its jailers for liquidity and therefore expected to comply with whatever additional conditions they impose. Tsipras should not submit to this debt bondage.
Nine of every 10 euros that eurozone governments and the International Monetary Fund (IMF) have lent to the Greek government since 2010 have gone torepay its unbearable debts, which should instead have been restructured back then. But from now on, every last cent of additional funding would go to pay back debt. The Greek government now has a small primary surplus: It doesn’t need to borrow, except to service its debts of 175 percent of GDP.
Yet in exchange for additional liquidity, Greece’s creditors are demanding a return to the failed austerity policies of the past five years, which have shrunkthe economy by 21 percent and thrown one in four people — and one in two youth — out of work. The hypothesis that austerity can cure insolvency has been tested to destruction. Another dose of it would be perverse.
As Martin Sandbu of the Financial Times points out, further austerity isn’t even in the creditors’ interests. They are demanding a fiscal tightening of 1.7 percent of GDP in the second half of this year alone. Since raising taxes and cutting spending would depress the economy — shrinking tax revenues and inflating social spending, thereby unwinding some of the budget tightening — a fiscal squeeze twice as big would be required to achieve the creditors’ target, if the past five years are anything to go by. According to Sandbu, that would crunch the economy by 5 percent, perversely raising the ratio of debt to GDP by some 9 percentage points. To achieve a primary surplus of 3.5 percent of GDP by 2018, as the creditors are demanding, would require a fiscal squeeze of 8.3 percent of GDP, depressing the economy by 12.5 percent and increasing the ratio of debt to GDP by around 22.5 percentage points. Far from bringing Greece’s debts down to more sustainable levels, further austerity would cause them to soar.
Why would eurozone authorities be so cruel and foolish? Because they don’t really care about the welfare of ordinary Greeks. They aren’t even that bothered about whether the Greek government pays back the money they forced European taxpayers to lend to it, ostensibly out of solidarity, but actually to bail out French and German banks and investors. German Chancellor Angela Merkel and other eurozone policymakers just don’t want to admit that they made a terrible mistake in 2010 and have lied about it since. So they want to be seen as standing up for eurozone taxpayers’ interests, and they want Greeks to put up and shut up until Merkel and her minions are comfortably in retirement, and it is someone else’s problem.
Further austerity isn’t the only consequence of leaving Greeks languishing in their debtors’ prison. Contrary to claims that Greece shells out scarcely any interest, it pays an average interest rate of 2.5 percent on its debts, according to Joakim Tiberg of UBS, a Swiss bank — 4.5 percent of GDP in total. With prices falling by 2.1 percent over the past year, the inflation-adjusted interest rate is 4.7 percent. Worse, the debt overhang creates crippling uncertainty about how the crisis might be resolved — including whether Greece might be forced out of the euro — stunting consumption, investment, and growth. Having creditors breathing down your neck to raise taxes is a further deterrent to investment. And the debt overhang also causes deflation, making the burden even more unbearable.
The creditors’ insistence on reform is also disingenuous. Greece has been run by the institutions known as the Troika — the European Commission, the European Central Bank, and the IMF — since May 2010. They have had every opportunity to insist on the reforms they are now demanding. Yet they kept on funding Greece because all they cared about was the fiscal targets (and wage cuts to boost “competitiveness”). The sudden focus on reform is primarily about forcing Tsipras to break the promises that got him elected in January.
Let me be clear: Greece urgently needs reform. Its economy is underdeveloped, hidebound, and dominated by oligarchic families who monopolize markets and suborn politics. Its public administration is corrupt and inefficient. Its legal system is dysfunctional, its tax system full of holes. Tsipras may or may not be willing to reform Greece. But ultimately, it ought to be up to Greeks whether and how they do so.
Indeed, the main sticking points between Athens and its creditors aren’t really reforms, they’re fiscal measures. While improving the collection and administration of value-added tax (VAT) is desirable, the creditors are also demanding a tax hike of 1 percent of GDP. That is wrong-headed, since it would hit the country’s main export sector, tourism, which accounts for 18 percent of GDP.
Pension reform is also necessary as Greeks live longer and fewer workers have to support more retirees. But the country’s social safety net is so threadbare that a single-slashed pension is often supporting a whole family of jobless people. So, while encouraging healthy people to continue working is desirable, pension cuts are not.
Some argue that Tsipras should sign up to what the creditors want, take the cash to pay off the looming bond payments to the IMF and the ECB, make a show of reform, and then press again for debt relief. But the notion that the creditors would then be more flexible is fanciful. In 2012, eurozone governments promised Greece debt relief once it achieved a primary surplus, but they still haven’t delivered it. The Greek government has now put forward sensible plans for restructuring its debts. Unless its creditors are willing to start negotiating meaningful debt relief, Tsipras should reject any deal on offer.
Merkel ought to be as magnanimous with Greece as the United States was with post-Nazi Germany, when Washington forgave half of the West German government’s debts in 1953 [this is not what was most important about the Marshall Plan money: None of it went back to the United States. All of it stayed in Germany-- Eliyahu m'Tsiyon]. But if eurozone authorities won’t be reasonable, unilateral default — and even euro exit — is preferable to debt bondage. 
[emphases are mine, likewise I supplied the link in the sentence above "Merkel ought to be as magnanimous. . . ."- Eliyahu

Labels: , , , ,