Ratcheting Up The Crisis In Europe

Elections in Greece can’t cause as much trouble as bank runs in Barcelona or Turin

By WALTER RUSSELL MEAD

“Crisis in the eurozone” stories are getting boring and this is one two year old soap opera the world would just as soon see disappear. Nevertheless it grinds on; yesterday the German finance minister said it could go on for another two years.  Unfortunately, he’s right.

But while the news from Europe is complicated and inconclusive (they are always threatening to jump off the bridge but so far, no one has), this is still a story one has to watch. And after months and years when the crisis was mostly in the hands of elites — heads of government, central bankers and the like — in the last couple of weeks the public has been getting involved, and that makes the crisis more dangerous and harder to solve.

A Weekend At Bernie’s

Support for Greece Declared – Sort Of

By Pater Tenebrarum

The markets last week gave our vaunted policymakers on both sides of the pond something to chew over, and the G8 palaver this weekend was marked by the usual sotto voce declarations that the once again budding crisis would be stopped dead in its tracks by whatever interventions are required.

Considering the fact that the financial markets are nowadays seemingly mainly populated by traders suffering from a special form of attention deficit disorder (this includes the mindless computer trading programs of various types that are active in the markets),  we can imagine that these declarations may create a short term bounce in 'risk' – whether it lasts for mere hours or a few days remains to be seen.

Italy And The Great Tax Revolt

The only difference between shakedowns by private thugs and those employed by the state is the badge

mark-2-16 "...why does he eat with tax collectors and sinners?"

by James Miller
Taxation is theft.
There is no denying this.  If I and a few brutes appeared at the door of an unsuspecting individual and demanded monetary compensation less we drag him off to jail, this would be a clear cut case of robbery.  It is a common tactic used by mobs or street gangs to offer protection with the barrel of a gun.  The only difference between shakedowns by private thugs and those employed by the state is the badge.  The badge legalizes extortion and imprisonment.

A Lifetime Of Serfdom

Spain's Public Servants

by J. Luis Martin 

They are cast as lazy and inefficient bureaucrats who don't work hard, take long coffee breaks and enjoy too many perks for being on the taxpayers' payroll. Indeed, the cliché is as universal as unfair. However, the Spanish civil service system exemplifies many of the things that are utterly wrong in the way the country is managed.

The Spanish public sector at a glance

Spain's civil service (función pública) remained virtually unchanged until the 1960s, when its rigid nineteenth-century French fonction publique mold was broken to allow for a more open Anglo-American model. In essence, this meant that access to the civil service was no longer exclusive to competitive examination and merit, as other schemes of recruitment were introduced. 

Η ομαδική αυτοκτονία ως μέσο γεωπολιτικής πίεσης

Πού θα οδηγήσει μια επιστροφή στη δραχμή

Νίκος Καραμούζης

Αγωνιούμε όλοι σήμερα για την πορεία της χώρας. Το εξωτερικό περιβάλλον επιδεινώνεται, σε συνάρτηση με την αύξηση της αβεβαιότητας στην Ελλάδα, ιδιαίτερα μετά το πρόσφατο εκλογικό αποτέλεσμα και την προκήρυξη νέων εκλογών. Το εκλογικό σώμα απέρριψε και τιμώρησε τα δύο πρώην μεγάλα κόμματα εξουσίας για τα πεπραγμένα δεκαετιών, αποδίδοντάς τους την ευθύνη για τη σημερινή κρίση και τον διεθνή διασυρμό της χώρας.

Παράλληλα όμως απέρριψε το εφαρμοζόμενο πρόγραμμα δημοσιονομικής και οικονομικής προσαρμογής, το μνημόνιο, γιατί δεν πείστηκε ότι προσφέρει ελπίδα και προοπτική έγκαιρης εξόδου από την κρίση, ότι οδηγεί στην επανεκκίνηση της οικονομίας, στη δημιουργία θέσεων εργασίας και στη διατηρήσιμη ανάπτυξη. Δηλαδή απέτυχε να πείσει ότι οι θυσίες των εργαζομένων θα πιάσουν τελικά τόπο, εξέλιξη που μας υποχρεώνει να επαναδιαπραγματευθούμε πτυχές του μνημονίου.

US Taxation Myths

The U.S. tax code is more progressive and European than you think

By Veronique de Rugy 

Americans often tout the contrast between the bloated, tax-funded welfare states of the Old World and our leaner, cheaper government. But the data reveal that the U.S. may be closer to Europe than we think.

Contrary to common belief, the American tax system is more progressive than those of most industrialized democracies. A 2008 report by the Organization for Economic Cooperation and Development (OECD), titled “Growing Unequal,” gave two different estimates of the progressivity of tax systems in 24 industrialized countries. One ranking found that the U.S. has the most progressive tax structure; in the other Ireland beat America by a nose. France, which has a notoriously generous welfare state, ranked 10th out of 24 in both of the OECD progressivity indexes.

Other countries have higher tax rates than the U.S. but manage to be less progressive overall. How can this be? The answer is that the rate structure alone doesn’t necessarily tell you much about the progressivity of a country’s tax system. The top rates kick in at much lower income levels in Europe than in the United States, making E.U. tax codes more regressive than ours. 

Beyond Austerity

We must liberalize labor markets, not rely on macroeconomic “fixes.”

by Richard A. Epstein 

Grim is the right word to describe the latest economic news from both the European Union and the United States. Throughout the European Union, austerity programs have failed both politically and economically. In Spain, unemployment rates have soared above 24 percent. The Dutch government is on the edge of collapse because of the popular and political unwillingness to accept the austerity program proposed by its conservative government. Romania is not far behind. Greece, Italy, and Portugal remain in perilous condition. France faces the free-spending socialist candidate Franciose Hollande. On the American front, the decline of GDP growth to 2.2 percent rightly raises fears that our sputtering domestic recovery is just about over.

Fiscal Austerity And Rational Morality

What is the proper purpose, size, and scope of government?

By Richard M. Salsman

Boring as it sounds, “fiscal austerity” has been a hot topic of debate among pundits and political economists in recent weeks, and  I for one think that’s terrific. This is an important debate, well worth having. First, it invites us all to look beyond the mindless histrionics of this year’s campaigning and legislating, and instead to examine a question far more relevant to our long-term security, prosperity and happiness, namely: What is the proper purpose, size, and scope of government? What is government’s nature and what should it be doing, or perhaps more crucially, not be doing? Second, the debate asks how we should be financing the government we have, and whether its spending, taxing, borrowing, and money-printing are moral or not, and practical or not. People should pay attention to this debate, as its outcome will surely affect them.

When Kafka met Orwell

A nightmare in Tewksbury

by George F. Will

Russ Caswell, 68, is bewildered: "What country are we in?" He and his wife Pat are ensnared in a Kafkaesque nightmare unfolding in Orwellian language. 
     
This town's police department is conniving with the federal government to circumvent Massachusetts law -- which is less permissive than federal law -- in order to seize his livelihood and retirement asset. In the lawsuit titled "United States of America vs. 434 Main Street, Tewksbury, Massachusetts" the government is suing an inanimate object, the motel Caswell's father built in 1955. The U.S. Department of Justice intends to seize it, sell it for perhaps $1.5 million and give up to 80 percent of that to the Tewksbury Police Department, whose budget is just $5.5 million. The Caswells have not been charged with, let alone convicted of, a crime. They are being persecuted by two governments eager to profit from what is antiseptically called the "equitable sharing" of the fruits of civil forfeiture, a process of government enrichment that often is indistinguishable from robbery.      

Europe finally awakes from its utopian dream

A defiant Angela Merkel is doing no more than defending the interests of her own electorate

By Janet Daley

Let’s say this again, just in case a single sentient being on the planet has missed it: Germany cannot simply decide to bail Greece (or Spain, or Italy, etc) out of its debts. OK? However much Angela Merkel is nagged, berated, bullied and patronised by Barack Obama, David Cameron, or the BBC/Guardian axis that regard the preservation of the euro project as critical to their own interests, she cannot just revoke, in a unilateral act, the rules of German government or of the Bundesbank.

Her persistent refusal to “take decisive action” of the kind that would suit the purposes of all those clamorous voices at the G8, is not “dithering”, as it is so often described. In fact, it is not (or not entirely) to be explained in any of the mildly contemptuous ways that her tormentors suggest. It does not arise from an unthinking, superstitious terror instilled in her by the Weimar nightmare of hyper-inflation. Nor is it a narrow-minded expression of the German hausfrau’s values of thrift and self-discipline. What Mrs Merkel is doing, quite appropriately, is defending the integrity of her national constitution, the economic principles on which her country’s economic success has been built, and the interests of her own electorate.

The Age of Innocence

The customer is always right

By DAVID BROOKS

The people who pioneered democracy in Europe and the United States had a low but pretty accurate view of human nature. They knew that if we get the chance, most of us will try to get something for nothing. They knew that people generally prize short-term goodies over long-term prosperity. So, in centuries past, the democratic pioneers built a series of checks to make sure their nations wouldn’t be ruined by their own frailties.

The American founders did this by decentralizing power. They built checks and balances to frustrate and detain the popular will. They also dispersed power to encourage active citizenship, hoping that as people became more involved in local government, they would develop a sense of restraint and responsibility.

A shrinking share of the population is carrying an ever-expanding army of dependents

As the Boomers Head for the Barn

by Patrick J. Buchanan

When the April figures on unemployment were released May 4, they were more than disappointing. They were deeply disturbing.

While the unemployment rate had fallen from 8.2 percent to 8.1 percent, 342,000 workers had stopped looking for work. They had just dropped out of the labor market.

Only 63.6 percent of the U.S. working age population is now in the labor force, the lowest level since December 1981.

During the Reagan, Bush I and Clinton years, participation in the labor force rose steadily to a record 67 percent. The plunge since has been almost uninterrupted.

Here is a major cause of the economic malaise of the 21st century, a condition over which a president has little control. A shrinking share of our population is carrying an ever-expanding army of dependents.

Read the rest at: http://takimag.com/article/as the boomers head for the barn

Judge Katherine Forrest is a Modern American Hero

It is the right of the people to alter or abolish any government that becomes destructive to liberty

by John Aziz

Sometimes, the greatest deeds are done by those who are just doing their jobs, like Judge Katherine Forrest who last week struck down the indefinite detention provision (§1021) of the National Defense Authorization Act (NDAA).

It would be all too easy in this age of ever-encroaching authoritarianism in America for a judge ruling on a matter like this to just go with the government line and throw water over the plaintiffs. After all, telling truth to power has consequences. Forrest was appointed by Obama, but after this ruling one wonders whether she is about to meet a career dead-end. Power — especially narcissistic power — does not like being told uncomfortable truths.

Pictures from our own future Horror novel

The Clash of Generations

Prologue: The Last Straw

The day was coming for years, decades, really.

Warnings had been sounded, loud, clear, and often.

Most heard, few listened. The problem was distant, its size unclear.

"No worries. We'll fix it. The next election, the next party, the next leader."

There was time.

There wasn't.

The contract was simple: 100,000 barrels of oil, delivered to this country, at this port, on this day. Payment in Chinese yuan.

The seller was big and always insisted on dollars.

Not that day.

European Illusions

Naming and Shaming the "Guilty Men"

By David Pryce-Jones

The level of unreality created by the masters of Europe is reaching new heights. It is like hallucinating to observe the politicians driving in expensive cars to meet one another, inspecting guards of honor, arranging for ministerial get-togethers, and all the while the construct that put them into office is collapsing all around them. These same politicians chatter extensively about saving the euro and the European Union, about bailouts and firewalls and fiscal pacts, as though words were deeds.

No satirist could do justice to the sight of German Chancellor Angela Merkel and newly elected French President François Hollande shaking hands and vowing to work together to save the union and its currency. Insofar as this pair has any coherent ideas, they disagree. All they have in common is the precariousness of their position. Just trounced in local elections, Mrs. Merkel and her party are well on the way to joining the gathering crowd of electoral rejects. As for Hollande, he believes that growth comes from higher taxes and hundreds of thousands more state jobs, and all in arch-protectionist France. It can’t be long before such socialist illusion comes back to haunt that country.

Will Merkel allow her electorate to become the slaves of Europe?

The Sack of Berlin

"Cries for the ECB to provide liquidity or for debt mutualisation are cries for Germans to work till they’re 67 so Greek crimpers can retire at 50" 

By John Phela

Behind the current rebellion against ‘austerity’ lies the idea that we can carry on as before if only we can screw the money to pay for it out of someone else. But if the bond markets won’t continue to fund them, who do the anti-austerity activists think will?

The most popular answer is ‘the rich’, AKA ‘the 1 percent’. Musing on the Sunday Times Rich List recently, eccentric Labour MP, Michael Meacher observed that 

“the richest 1,000 persons... increased their wealth over the last three years by £155bn. That is enough for themselves alone to pay off the entire current UK budget deficit and still leave them with £30bn to spare.” 

Meacher clearly doesn’t know or doesn’t care how wealth works; the £155bn might not be in the form of cash but (more likely) in the form of assets which would have to be sold for cash which could only then be used to plug the deficit. However, there is no guarantee that these asset values would hold up if these 1,000 rich folks tried to sell £155bn worth at once.

But you also wonder how closely Meacher scrutinized this list

Dr. Frankenstein's Europe

“What the hell are they thinking?”

by John Mauldin

"Had I right, for my own benefit, to inflict this curse upon everlasting generations? I had before been moved by the sophisms of the being I had created; I had been struck senseless by his fiendish threats; but now, for the first time, the wickedness of my promise burst upon me; I shuddered to think that future ages might curse me as their pest, whose selfishness had not hesitated to buy its own peace at the price, perhaps, of the existence of the whole human race."

– The musings of Dr. Frankenstein about his creation of a monster, in Mary Shelley's 1818 novel, Frankenstein

Cost of Losing Athens Can't Be Calculated

What is the cost of throwing good money after bad?

By CARL BIALIK

As Greece girds for elections next month that could lead to its exit from the euro zone, economists are acknowledging an unsettling reality: No one knows what the bill will be.

A wide range of potential price tags has been reported, anywhere from €150 billion to €1 trillion euros ($1.27 trillion). But none of these are comprehensive, nor are they meant to be—they don't, for instance, weigh the cost of an exit against the cost of avoiding one. By comparison, the 2008 Troubled Asset Relief Program, known as TARP, was a $700 billion program initiated in response to the U.S. financial crisis.

Capitalists and other Psychopaths

A Faible for Socialism

by Pater Tenebrarum

We have often remarked on the soft spot the New York Times has for socialism. It is after all the ideology that is most popular among the self-proclaimed intelligentsia, as can be easily ascertained by observing the unbroken support it enjoys in academe – in spite of the fact that the communist system has collapsed in what was the biggest bankruptcy in human history. Apparently they just failed to 'implement Marxism correctly'. It is easily forgotten today that Western intellectuals were cheering for the Soviet Union throughout its seven decade history, from the Lenin era until its ignominious demise.

The mass murderer Stalin was highly popular with our vaunted intellectuals, who gleefully quoted the strong growth in industrial production reported by the Soviets while the West was mired in the Great Depression. That Stalin used a reserve army of slaves from his Gulags to accomplish his alleged economic miracles was silently glossed over. The fact that Soviet production was completely chaotic due to the socialist economy's inability to calculate never rated a mention. The 'data' looked good, that was all that counted.

Pay Up Or Else – Tsipras Plays Hardball

Waving the Default Threat

by Pater Tenebrarum

Alexis Tsipras continues to throw spanners into the works, or let's rather say he seems to be on a mission to fray the nerves of eurocrats and investors alike. This must of course be seen in the context of ongoing electioneering on his part: now that he has been thrown into the limelight, he has to play the role he has assigned to himself to the hilt.

The WSJ reports that there is now a 'defiant message from Greece':

“The head of Greece's radical left party says there is little chance Europe will cut off funding to the country and if it does, Greece will repudiate its debts, throwing down a gauntlet that could increase tensions between Greece's recalcitrant politicians and frustrated European creditors.

Euro area official sector exposures in excess of EUR290bn

Germany EUR 84bn ,France EUR 63bn , Italy EUR 55bn , Spain EUR 37bn

By MIKE SHEDLOCK

Euro area official sector exposure

According to the French Finance Minister, F. Baroin, Greece's exit from the euro area "would cost France EUR 50bn net, in addition to the securities held by banks and insurers in their portfolios." In the German press, it is reported that a Greek exit would cost approximately EUR80bn (EUR16bn from bilateral KfW loans, EUR20bn from the EFSF, EUR12bn from the SMP and EUR30bn from Target 2, based on December 2012 data, source: FAZ).

Here, we estimate the euro area's official sector exposure to Greece (bilateral loans, EFSF guarantees and Eurosystem) and show that the cost estimations mentioned in the press match the exposure if you consider a 20% recovery rate on Greek holdings. 20% is rather low, but not unrealistic given the outcome of the PSI and devaluation of the new Greek currency in the event of an exit. However, because of the accounting treatment of the different exposures and the presence of some financial buffers within the Eurosystem, the one-off, year-end shock on public accounts will be much smaller, probably around EUR100bn (1% of GDP).

The Real Debate On Gold And Money

Our economic system cannot remain both free and centrally planned

by Jeff Snider

Monetary adjustments, heavy as they have been in these past four years, will remain a permanent part of our economic landscape so long as central banks remain committed to their current course.  Now that the annual excitation of economists and their dreams of recovery are waning, and the “unexpected” decline in the economy has returned right on schedule, the discussion needs to turn toward those monetary interventions.  

I have had many discussions with clients and members of the general public on the topic of the gold standard over the past few years, especially in the past several weeks as Chairman Bernanke deliberately broadcasts his specific problems with it from the perspective of a central banker tasked with “saving” the economy.  Even getting past the glaze of apparent anachronism, largely that something so archaic seems utterly incompatible with our modern electronic society, the persistent, and otherwise extremely healthy, mistrust of banks prevents a further discussion of how the gold standard really works.  

Human existence as a terrible “cancer” destroying God’s good creation

Environmentalism Has Become a Religion 

by Robert H. Nelson

Earth Day, the environmentalist holy day, is approaching again, reminding us that environmentalism has become a kind of religion. Which raises a question: Why is it OK to teach environmental religion in public schools, while the teaching of Judaism, Christianity, and other traditional religions is not constitutionally permitted?

As Joel Garreau, a former Washington Post editor, wrote in 2010,

“faith-based environmentalism increasingly sports saints, sins, prophets, predictions, heretics, sacraments and rituals.”

From a world in which hatred is incidental and avoidable to a world in which hatred is central and inescapable

The Systematic Organization of Hatreds

By Robert Higgs

In the mid-1970s, I began to do consulting work in addition to my academic work. By that time, I had become familiar with how economists generally analyze cooperation and competition, in both the economy and the political realm. Economists put great weight on gains from trade. Nobody, they like to say, walks past a $20 bill he sees lying on the sidewalk. If a situation contains the potential for a trade or other arrangement that will bring gain to a decision-maker, he will embrace that trade or arrangement. This market process leads, in the theoretical extreme, to the happy condition known as the Pareto Optimum—the situation in which all potential gains from trade have been captured.

Notice that this view of mankind causes us to think of people as self-interested, but not as vicious. Individuals are seen as, in effect, indifferent to the welfare of their trading or cooperating partners, but intent on making themselves as well-off as possible. They do not seek to harm others, but only to benefit themselves (and those about whom they happen to care).

Money, Gold and Human Liberty

By abandoning the gold standard we embraced monetary central planning chaos

“..when you recall that one of the first moves by Lenin, Mussolini and Hitler was to outlaw individual ownership of gold, you begin to sense that there may be some connection between money, redeemable in gold, and the rare prize known as human liberty.

by DETLEV SCHLICHTER

It is my conviction that the central problem with the present system is the high degree of elasticity of the money supply. A system of constant fiat money expansion, of ongoing injections of new money into the economy via financial markets – sometimes slow, sometimes fast – must systematically distort interest rates and disarrange saving and investment. This will lead to capital misallocations and the mispricing of assets. As these distortions are systematic, the resulting dislocations are bound to accumulate over time and thus progressively destabilize the economy. Elastic money is suboptimal, unstable and unsustainable.

The point is not that a gold standard is perfect or ‘perfectly efficient’ or even free of any disturbances or disruptions. The point is simply that by fading out gold as a fairly inelastic basis of the monetary system and replacing it with essentially fully elastic and unlimited fiat money, as happened around the world in the period from 1914 to 1971, we have made the financial system and by extension our economies substantially more unstable. While the system can appear stable on the surface for extended periods, the economy is constantly accumulating imbalances that will finally unhinge it.

The case against growth and freedom

The Face of Genocidal Eco-Fascism

by John Aziz 

I am not exaggerating.

This is Finnish writer Pentti Linkola — a man who demands that the human population reduce its size to around 500 million and abandon modern technology and the pursuit of economic growth — in his own words.

He likens Earth today to an overflowing lifeboat:

What to do, when a ship carrying a hundred passengers suddenly capsizes and there is only one lifeboat? When the lifeboat is full, those who hate life will try to load it with more people and sink the lot. Those who love and respect life will take the ship’s axe and sever the extra hands that cling to the sides.

He sees America as the root of the problem:

The United States symbolises the worst ideologies in the world: growth and freedom.

He unapologetically advocates bloodthirsty dictatorship:

Any dictatorship would be better than modern democracy. There cannot be so incompetent a dictator that he would show more stupidity than a majority of the people. The best dictatorship would be one where lots of heads would roll and where government would prevent any economical growth.

Japan and Europe are Killing Themselves

They will tax themselves to death

by Steve Forbes

The global economy is lurching toward the cliff. Twice before over the last 75 years Washington took the necessary action, and after November, with a new President and Congress, there will be the opportunity--and imperative--to do so again.

The 1970s were a decade of economic turmoil and stagnation. The 1930s were far worse. And now the world is headed to the brink again.

After the Great Depression and the Second World War the U.S. helped create and nurture the institutions that enabled war-torn Europe and Japan to make rapid recoveries. The gold-based Bretton Woods monetary system provided the currency stability necessary for the resumption of international trade. The General Agreement on Tariffs & Trade (and then its successor, the World Trade Organization) systematically reduced trade barriers. At home we ended wartime controls and rationing, cut taxes and slashed government spending. Almost seamlessly, millions of veterans came home to productive civilian employment. For the next 25 years Japan and Germany repeatedly reduced their tax burdens and became economic global giants.

The destruction of Bretton Woods in the early 1970s led to a horrific, inflation-wracked decade. The U.S. experienced a stagnant economy and rising inflation and was seen as a malaise-ridden nation in irreversible decline.

About Bears and Hamsters

'No biting the bear's sensitive parts' 

By John Helmer 

In the Kremlin corridors under the new management, it is generally acknowledged that one of the stupidest things former president (now premier) Dmitry Medvedev ever did was to order Russia's representative on the United Nations Security Council to abstain from the vote and veto of the no-fly zone resolution aimed at the Muammar Gaddafi regime in Libya. 

That was on March 17, 2010. Russian intelligence services already knew that United States and British submarines were in place under the surface of the Mediterranean, ready to fire missiles to start a war that was intended to end in Gaddafi's death. It did. 

A year later in 2011, when the campaign for Russia's parliamentary elections and the presidential succession was underway, that abstention almost ended in the death of
Medvedev's chances to stay under now President Vladimir Putin's protection. 

He didn't get the nod for a second term as president, but as prime minister he has survived in more lively shape than Gaddafi. 

However, Russian officials are now unanimous that the ill-fated effort by a Russian leader to allow a war of military intervention and regime change by the US and the North Atlantic Treaty Organization (NATO) alliance, funded by Arab sheikhdoms, should never be repeated. 

It's all about Pensions

Reframe the 'Growth vs. Austerity' Debate

By MICHAEL HODIN

From Athens, Greece, to Madison, Wisconsin, the common theme today is said to be “austerity versus growth.” In reality, we’re hearing little about what’s driving the growth side and a great deal about the disasters to come from cutting benefits. This dichotomy is perhaps most pronounced in Europe, where the “austerity versus growth” headlines rage. The terms “austerity” and “growth” have appeared within ten words of each other 380 times in major world publications in the past week alone, according to a Lexis Nexis search.

The discussion of these concepts continues to be framed as an either/or. There are the tight-fisted Germans led by Angela Merkel – and Mediterranean Europe that’s holding onto 20th-century ideas of work, life, and aging. The debate has become so entrenched that one can be forgiven for thinking it is either austerity or growth.

But there’s an alternative to this bifurcated rhetorical gridlock. If aging populations can break out of traditional roles of dependency to contribute to social and economic life, societies can find the magical balance of growth and what is now called austerity. Sound fantastical? It shouldn’t. It’s actually straightforward arithmetic and can be summarized in a 21st-century model of working life that connects to the fact we’re regularly living into our 90s.

Keynesianism is in a death spiral

The Case for Austerity

By Gary North

The Keynesians and declared anti-Keynesians have joined hands in order to promote an intensely Keynesian error: European fiscal austerity as a negative factor. One contributor in Forbes refers to austerity as a death spiral.

The word “austerity,” beginning with the Greek government’s debt crisis two years ago, has been used by the financial media in one sense, and only one sense: reductions in spending by national governments. The word is not used with respect to the economy as a whole.

More than this: the word has been used to explain the contracting economies of Europe. The reductions in government spending are said to have caused the contracting economies. This explanation is based on textbook Keynesianism.

Keynesians call for increased government spending. This is the heart of Keynesianism. Keynesianism rests on a mantra: “Government spending overcomes recessions.” All else is peripheral: monetary inflation, graduated taxation, and free trade. These peripheral issues will always be sacrificed to the supreme economic premise: “Government spending overcomes recessions.”

‘The real enemy is humanity itself’

At Rio+20, the world’s elites will meet with the aim of holding back human progress

by Ben Pile 

Forty years ago, two ideas about humanity’s relationship with the natural world caught the imagination of the richest and most influential people. The first was that the demands of a growing population were taking more from the planet than could be replaced by natural processes. The second, related idea was that there exist natural ‘limits to growth’. These two reinventions of Malthusianism became the basis of a new form of global politics, which has sought to contain human industrial and economic development ever since.

Fears about the possibility of global environmental catastrophe and its human consequences, as depicted by neo-Malthusians like Paul Ehrlich - author of the 1968 prophecy, The Population Bomb - and the Club of Rome - a talking shop for high-level politicians, diplomats and researchers - became the ground on which a number of organisations established under the United Nations were formed. In 1972, the UN held its Conference on the Human Environment, and began its environment programme, UNEP. In 1983, the World Commission on Environment and Development (WCED, aka The Brundtland Commission, after its chair, Norwegian politician Gro Harlem Brundtland) was formed, leading to the publication of its findings in 1987 in Our Common Future. Also known as the Brundtland Report, it became the bible of ‘sustainable development’.

Who Needs War for Oil?

Popular Illusions

By ROBERT P. MURPHY

For decades Americans have endured a steady drumbeat urging the need to wean the U.S. from its “addiction” to oil. The specific reasons differ, depending on the critic: leftists stress the environment and the social joys of a European-style mass transit system, while right-wingers worry about oil from a national-security standpoint. Yet both camps agree: left to its own devices, the laissez-faire American economy would rely too heavily on oil, and therefore there is an important role for federal intervention.

For a specific and recent example, let us turn to the group named SAFE, which stands for “Securing America’s Future Energy.” Its newly released report titled “The New American Oil Boom” explains:

The Future Is More Than Facebook

America's innovation engine is now focused on transportation, energy and manufacturing

By RICH KARLGAARD

In March 1986, Microsoft ended its first day as a public company with a market capitalization of $780 million. Its value grew more than 700 times that over the next 13 years and made Bill Gates, in 1999, the richest man ever with a net worth of $101 billion. When Facebook goes public this Friday its market cap could easily hit $100 billion, bringing founder Mark Zuckerberg's net worth to more than $18 billion. That's about 50 times what Mr. Gates was worth after Microsoft's IPO.

Facebook's big payday should be cause for celebration in a liberal democracy. Instead it has provoked two kinds of anxiety. Both imply America's best days are over.

Greece Will Reset

Think “Argentina” and you will see the same path for Greece

By Jeff Harding

There is no real solution for Greece. They are bankrupt and their economic foundation is rotten. They have bred a society that wants generous benefits on the one hand, and on the other, cynical producers who don’t want to pay taxes. They are similar to Eastern Bloc countries post-Soviet collapse. They need a similar revolution to shake off the socialists and forge a new government based on free market principles. They need a complete reformation of their economy. Anything else will just delay the inevitable.

The eurozone would be better off by jettisoning Greece and letting them fail. The money spent to save them will be wasted. One can only hope against hope that they will re-emerge without their social burdens and with a free market economy. Otherwise, and probable, will be a prolonged depression for Greece.

I haven’t been writing much about the eurozone, and especially Greece, lately because I don’t think I have much more to say than I already have, other than to report what “progress” has been made. Which is to say, none. And which is what I had expected.