Greeks are not the only ones suffering - The Daily Reckoning
The Daily Reckoning by Bill Bonner
On This Day - 17 February 2012
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Rancho Santana, Nicaragua

The trouble with paradise...

"Who would have thought," said a colleague yesterday. "We got here, what, 15 years ago, there was nothing...nothing."

"Nothing... but paradise," we replied.

"Well, now it's even better. You're never satisfied. Now we have a paradise with houses...swimming pools...and even a convention center. It's a paradise that people can enjoy."

"I enjoyed it more when we had it all to ourselves," we countered.

More ...below...first, let us cast our eyes over the world of finance...

The headlines still focus on Greece. It is broke. Here is Lucas Papademos, describing what an orderly default would mean. In the Telegraph:

"The savings of the citizens would be at risk. The state would be unable to pay salaries, pensions, and cover basic functions, such as hospitals and schools, and ... the country - public and private sector alike - would lose all access to borrowing and liquidity would shrink.

"The living standards of Greeks would collapse. The country would drift into a long spiral of recession, instability, unemployment and prolonged misery. These developments would lead, sooner or later, to exit from the euro."

Sounds good to us! The Greeks have been living beyond their means. Living standards must fall. Best to get on with it.

But the efforts of a whole class of over-paid meddler have been directed at trying to avoid this outcome. They've hesitated...prevaricated...vacillated... and generally fornicated up the situation.

They've swept so much dirt under the rug that there's now an Everest in the middle of the room... It can no longer be ignored.

But Greece isn't the only country to live beyond its means. And the Greeks aren't the only ones to suffer. In Britain, the economy is holding its own...but only by loading the young with debt in order to continue supporting the old in the style to which they've become accustomed.

Here, the New York Times reports:

Perhaps the most debilitating consequence of the euro zone's economic downturn and its debt-driven austerity crusade has been the soaring rate of youth unemployment. Spain's jobless rate for people ages 16 to 24 is approaching 50 percent. Greece's is 48 percent, and Portugal's and Italy's, 30 percent. Here in Britain, the rate is 22.3 percent, the highest since such data began being collected in 1992. (The comparable rate for Americans is 18 percent.)

Classified by statisticians as NEETs (not in education, employment or training), they number about 1.3 million, or one of every five 16-to-24-year-olds in the country.

Lower incomes...unemployment...fewer benefits... Get used to it.

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*** We spent a week at our place in Nicaragua...and we wonder why we don't spend more time here.

"Because life is a struggle," said our friend. "Here, there's nothing to struggle against...except your worst enemy, yourself."

Hmmm...

The climate is benign. No need to fight against the elements. The views are the best in the world. Nature has made this coast her chef d'oeuvre; it would be a sin to complain, ingratitude to ask for more.

But more is just what we can't help asking for...

The food is delicious. The pace is relaxed. We wake up...the sun shines in the window... Outside, the surf pounds the sand. We take a walk along the beach...often seeing no other human being...splashing our bare feet in the warm water.

Returning up the steps to the house, Tere, our housekeeper has already put breakfast on the table...fresh fruit, coffee, eggs...

Later, we sit on the porch...overlooking the ocean...and do our work. No commuting. No traffic. No parking. No snow. No ice. Nothing disturbs our work...or our thoughts...

What's not to like?

"Well...you can't sit still and enjoy things. You need to look for challenges. And if you can't get mad at other drivers or God, you'll have to get mad at yourself."

Hmmm...

What kind of world is this? We work to make it better...and then, when it is nearly perfect, we can't resist improving it.

...Or making it worse.

*** There have always been booms and busts. There were years of good harvests...and years of bad ones. The prudent farmer saved some grain...just in case.

But in the 20th century real money - gold - was replaced by paper money and 'just in case' became 'just in time.'

Even John Maynard Keynes, the architect of modern government meddling in the economy, suggested that governments should save money so they would have something to spend when the private sector cut back.

But the feds didn't save. They spent. And when times got tough, they spent even more money. Trouble is, without savings, they had to borrow the money to spend...which means taking it out of the very economy that is short on money already.

The only other option is to print up extra money - in effect, creating it 'out of thin air.' But if you could just print 'money' and make yourself better off everyone would do it. People are not made richer just by printin up pieces of paper with green ink on them. They get richer by having real purchasing power...and real resources at their command...and by being able to produce goods and services that people want.

*** Hillary Clinton calls up Egypt, Syria, Libya, and China to "democratize." But democracy, as practiced by the US and other developed countries, is a fraud. It is just a way for the insiders to scam money and power from the outsiders, by pretending that the voters are in charge.

Just ask how many taxpayers would vote to spend about $10,000 each on the war against Iraq?

How many would vote to spend $1.60 cents for every dollar in tax revenue?

How many would vote for the latest mortgage deal...where homeowners who saved their money and paid their mortgages are forced to make up for those who bought houses recklessly...and then couldn't make their payments?

How many would vote to bail out Goldman Sachs...Bank of America...or Citigroup?

But voters never get a chance to vote on the issues. They vote for candidates...financed by insiders, with agendas the outsiders cannot even imagine.

The word 'democracy' arose in small, Greek city states, where the voters actually voted on the concrete issues, not just the slippery candidates. Citizens voted to go to war...knowing not only that they would have to pay for it...but that they could be killed in the battles themselves. War was a matter of life and death, not just a campaign slogan of a chubby, middle-aged draft-dodger.

The Italian city states practiced real democracy too. In 15th century Florence, for example, citizens voted on whether or not to build a cathedral... Then, they voted on what shape it should take.

A scale model was built. Citizens knew what it would look like. They understood how it was built and how much it would cost them. They cast their ballots and took responsibility for the outcome.

American democracy, circa 2012, has no more in common with real democracy than American capitalism has in common with real capitalism. Both are degenerate...corrupt...and geriatric.

Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.

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6 Responses to "Greeks are not the only ones suffering"

VIJI

Feb 21, 2012

DYNAMIC..,TO CONTEST PRES.ELEC'.
ALL THE BEST...

Like 

Pawan

Feb 18, 2012

Bang on Bill. Indian democracy is no different.

Like 

Ramana Kumar

Feb 18, 2012

Very outspoken comments on the nature of American Democracy and Capitalism. I wonder if the FBI / CIA / Homeland Security / NSA are tracking comments such as these ? Congrats on your courage in calling a spade a spade, Bill ! All the best and stay safe !!

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M G Sharma

Feb 17, 2012

Still we support such kind of democracy which just hidden means of squeezing blood out of common peoples veins

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surajit som

Feb 17, 2012

very true. the crisis is all-pervasive. earlier third-world countries were told that their misery was due to bad governance and bad leaders. their poverty spoils everything. now we see too much wealth can lead to disaster also .people everywhere -from first,second,third worlds- find to their horror that the rich world leaders are equally crooked,are equally hand-in-glove with industrial,financial crooks. nowhere there is any hope now. crooks will survive ,others are doomed. somehow the middle age is back.

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SSN Raju

Feb 17, 2012

We in India In specific willingly we are voting for robbers to rob us. What is the way out. we have one solution in this voting system.

Section 49-O of the Constitution!

Please know that there is a system in our constitution, as per the 1969 act, in section "49-O" that a person can go to the polling booth, confirm his identity, get his finger marked and convey the presiding election officer that he doesn't want to vote for anyone!

Yes such a feature is available, but obviously these seemingly notorious leaders have never disclosed it. This is called "49-O".

Why should you go and say "I VOTE NOBODY"... because, in a ward, if a candidate wins, say by 123 votes, and that particular ward has received "49-O" votes more than 123, then that polling will be cancelled and will have to be re-polled. Not only that, but the candidature of the contestants will be removed and they cannot contest the re-polling, since people had already expressed their decision on them. This would bring fear into parties and hence look for genuine candidates for their parties for election. This would change the way, of our whole political system... it is seemingly surprising why the election commission has not revealed such a feature to the public....


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