Sunday, July 26, 2015

TISA and the Grebacle (from the notebook)

TISA = Trade in Services Agreement, Grebacle = Greek debacle, a subject I've been too discouraged to write about so far. (I would happily have given a headline link to the US government's page on TISA, but there is almost nothing there, so in protest I'm linking Wikileaks instead.)

On July 6th, I had been writing about Greece for a week or so, and one evening I was reminded by David Dayen that the capital controls the Bank of Greece used to survive would be outlawed under the proposed TISA agreement. If Dayen is correct, most effective consumer banking regulation would be outlawed under TISA, leading to a situation where hoarding cash might again become reasonable. Are we all to be made into Greece? Or what?

Saturday, July 11, 2015

Yemen: Saudi Arabia has turned hawkish

This one is a "what Juan Cole said" post. From two months ago:
Watching Riyadh, the capital of Saudi Arabia nowadays, is like Kremlin-watching in the old days of the Cold War. It is not as if most Western journalists have a really good idea of the maneuverings inside the Saudi palace or know why exactly things happen. Since King Salman succeeded the late Abdullah this winter, Saudi Arabia has become a different country with regard to foreign policy. Abdullah was known for being cautious and diplomatic.[…] Since Salman came to power, it is as though Bruce Banner got angry and turned into the Incredible Hulk. […] And then without telling the US it was going to do so until the last minute, the Saudi Air Force began a massive bombing campaign on Yemen in a bid to destroy the rebel Houthi movement of Zaidi Shiites

And, the point:
I think we may conclude that something has changed. The hawks have taken over Saudi Arabia and it is newly militarily assertive and the long-standing paranoia about Iran has spun out of control.
Go read the damn thing. We're in still more trouble, if that is possible.

Monday, July 6, 2015

Thomas Piketty Totally Pwns the German Austerians

My book recounts the history of income and wealth, including that of nations. What struck me while I was writing is that Germany is really the single best example of a country that, throughout its history, has never repaid its external debt. Neither after the First nor the Second World War. However, it has frequently made other nations pay up, such as after the Franco-Prussian War of 1870, when it demanded massive reparations from France and indeed received them. The French state suffered for decades under this debt. The history of public debt is full of irony. It rarely follows our ideas of order and justice.
The fine upstanding German state, I'm sure, deserved its debt relief.

(The German newspaper Die Zeit (The Times) posted this interview in German. An authorized English translation is available at the Indian site, The Wire. Google's mechanical translation is here.)

(Updated July 17, 2015, to include the English translation.)

Sunday, July 5, 2015

Grisis 7/5

The Troika lost the referendum. If the Troika hadn't overplayed their hand by forcing a Greek bank shutdown, they might have won: two weeks ago polling showed the Greeks were evenly split on the Troika's position.

The Greeks are dancing in the streets. I am left feeling, though, that little has been won. It is hard for me to see the Germans backing down. It is just possible the Troika will split internally; the leaked (unofficially released?) IMF report indicates that the IMF staff, at least, wants debt reduction for Greece. But for the Greeks, more hard times. And there are terrible risks. The Greek fascist Golden Dawn party also sees this as a victory, and if conditions do not improve in Greece quickly, they will have a chance at power. It is hard for me to imagine any EU nation going to war to collect their Greek debt, but tensions could increase.

Still, at least austerity has taken a hit in the eyes of the world. I think other European counties whose hard times have been made harder by poor decisions of the European Central Bank will fight harder, even if the Troika ultimately prevails in Greece.

Yemen: and now for something completely different

The United Nations Office for Coordination of Humanitarian Aid (OCHA) writes:
Since the violence in Yemen escalated in March over 3,083 people have been killed and 14,324 have been injured, while over one million people have had to flee their homes. Three months into the conflict escalation, more than 21.1 million people – 4 in 5 Yemenis – now need some form of humanitarian assistance.—OCHA Press Release, 1 July 2015 
 OCHA overview

F—, F—, F'ity F—.

Friday, July 3, 2015

Grisis 7/3: but there is commentary

And it's totally appropriate for Independence Day in the USA, so here's a few links:
  1. Enough about Greece, let's talk about Finland: "Finland is a model European citizen; it has honest government, sound finances and a solid credit rating, which lets it borrow money at incredibly low interest rates. It’s also in the eighth year of a slump that has cut real gross domestic product per capita by 10 percent and shows no sign of ending."—Paul Krugman, Europe’s Many Economic Disasters, "What all of these economies have in common, however, is that by joining the eurozone they put themselves into an economic straitjacket."
  2.  Jamie Galbraith, advisor to Syriza. Greece: Only the 'No' Can Save the Euro and 9 myths about the Greek crisis.

Thursday, July 2, 2015

Grisis 7/2

And now:
According to the IMF, Greece should have a 20-year grace period before making any debt repayments and that final payments should not take place until 2055.—Guardian link
So now, the IMF admits Greece's debt is unsustainable, after putting the Greeks through five years of misery.

I'm going to put this series of posts on hold, pending the referendum. The various parties have staked out their positions and it does not seem like much will change until it is held.