El Recurso de la Deuda

Irish Famine Memorial, Dublín

Comenzó la temporada electoral en la Argentina. Tiempo de pensar en las opciones disponibles. En efecto, ¿de qué lado quedaron los chicos del ajuste? Nos referimos a los Cavallo, los Melconián, los Broda, los Artana, los Danielitos Marx, los Sturzenegger, los Loser, los López Murphy, los Espert y tantos otros, hijos y nietos de José Alfredo, el Mago de Hoz, el Orejas, el intérprete exquisito de la Escuelita de Chicago. 

En su comentario al libro de José Natanson “Buenos muchachos - Vida y obra de los economistas el establishment”, Arnol Kremer señalaba:

La investigación logra esclarecer “¿Quiénes son?, ¿Qué dijeron?, ¿Quién les paga?”. Sin embargo, frente al interrogante clave “¿Por qué se los escucha?”, formula una respuesta al menos limitada: “fueron eficaces durante largos períodos (…) una elite suprapartidaria (…) capaz de formar parte de gobiernos radicales y peronistas (…) influir en la opinión pública” y su última frase es casi una tautología.: “fueron –y siguen siendo– la mejor expresión del poder económico argentino”. Quizás esa limitación –que no quita méritos al libro– se deba a que el autor circunscribió la investigación al ámbito de la disciplina económica y sus halógenos (la bibliografía citada es elocuente). O probablemente no haya una respuesta satisfactoria hasta que la praxis social asuma una real alternativa.

Uno se pregunta, a esta altura del partido: ¿habrá asumido la praxis social argentina una real alternativa? ¿Nos acordaremos de la época en que comíamos gatos? Con espíritu didáctico, Astroboy propone a sus lectores un repaso a esa vieja táctica de los imperios de turno: el Recurso de la Deuda como instrumento de dominación. A continuación posteamos dos notas, ambas relativas a la Grecia de hoy pero apuntando a un marco general. La primera salió en el blog Jesse’s Caffe Americaine. Recomienda ver un videíto. Viejito, pero bonito.

Título: Debt, War and Empire By Other Means

Texto: This video below may help one to understand some of the seemingly obtuse demands from the Troika with regard to Greece:

https://youtu.be/p7gxkgssngU

The video is a bit dated, but the debt scheme it describes remains largely unchanged. The primary development has been the creation of an experiment called the European Union and the character of the targets. One might also look to the wars of 'preventative intervention' and 'colour revolutions' that raise up puppet regimes for examples of more contemporary economic spoliation.

From largely small and Third World countries, the candidates for debt peonage have become the smaller amongst the developed Western countries, the most vulnerable on the periphery. 

And even the domestic populations of the monetary powers, the US, Germany, and the UK, are now feeling the sting of financialisation, debt imposition through crises, and austerity.   What used to only take place in South America and Africa has now taken place in Jefferson County Alabama. Corrupt officials burden taxpayers with unsustainable amounts of debt for unproductive, grossly overpriced projects.

It would be wrong in these instances to blame the whole country,  the whole government, or all corporations, except perhaps for sleepwalking, and sometimes willfully, towards the abyss.  For the most part a relatively small band of scheming and devious fellows abuse and corrupt every form of government and organization and law in order to achieve their private ambitions, often using various forms of intimidation and reward.  It is an old, old story.

And then there is the mass looting enabled by the most recent financial crisis and Bank bailouts.  If the people will not take on the chains of debt willingly, you impose them indirectly, while giving the funds to your cronies who use them against the very people who are bearing the burdens, while lecturing them on moral values and thrift.  It is an exceptionally diabolical con game.

The TPP and TTIP are integral initiatives in this effort of extending financial obligations, debt, and control.  You might ask yourself why the House Republicans, who have fought the current President at every turn, blocking nominees and repeatedly staging mock votes to denounce a healthcare plan that originated in their own think tank and was first implemented by their own presidential candidate, are suddenly championing that President's highest profile legislation, and against the opposition of his own party?  Where did that come from?

The next step, after Greece is subdued, will be to extend that model to other, larger countries.  And to redouble the austerity at home under cover of the next financial crisis by eliminating cash as a safe haven, and to begin the steady stream of digital 'bailing-in.'   They will not even have to ask, as if it mattered.

This is why these corporatists and statists hate gold and silver.  And why it is at the focal point of a currency war.  It provides a counterweight to their monetary power.  It speaks unpleasant truths. It is a safe haven and alternative, along with other attempts to supplant the IMF and the World Bank, for the rest of the world.

So when you say, the Philippines deserved it, Iceland deserved it, Ireland deserved it, Africa deserves it, Jefferson County deserved it, Detroit deserved it, and now Greece deserves it, just keep in mind that some day soon they will be saying that you deserve it, because you stood by and did nothing.

When they are done with all the others, for whom do you think they come next?   If you wish to see injustice stopped, if you wish to live up to the pledge of 'never again,' then you must stand for your fellows who are more vulnerable first.

The economic hitmen have honed their skills amongst the poor and relatively defenseless, and have been coming closer to home in search of new hunting grounds and fatter spoils.  There is nothing 'new' or 'modern' about this.  The only thing that changes are the names for it.

This is as old as Babylon, and evil as sin.  It is the power of darkness of the world, and of spiritual wickedness in high places.   The difference is that it is not happening in the past, or in a book, it is happening here and now.

"Economic powers continue to justify the current global system where priority tends to be given to speculation and the pursuit of financial gain. As a result, whatever is fragile, like the environment, is defenseless before the interests of the deified market, which becomes the only rule."

Francis I, Laudato Si

"Plunderers of the world, when nothing remains on the lands to which they have laid waste by wanton thievery, they search out across the seas. The wealth of another region excites their greed; and if it is weak, their lust for power as well. Nothing from the rising to the setting of the sun is enough for them. Among all others only they are compelled to attack the poor as well as the rich. Robbery, rape, and slaughter they falsely call empire; and where they make a desert, they call it peace."

Tacitus, Agricola

You may also find some information about the contemporary applications of these methods in The IMF's 'Tough Choices' On Greece by Jamie Galbraith which I highly recommend.

Efectivamente, la nota de Galbraith es altamente recomendable. Acá va (los subrayados son nuestros):

Título: The IMF’s “Tough Choices” on Greece

Texto: ATHENS – The International Monetary Fund’s chief economist, Olivier Blanchard, recently asked a simple and important question: “How much of an adjustment has to be made by Greece, how much has to be made by its official creditors?” But that raises two more questions: How much of an adjustment has Greece already made? And have its creditors given anything at all?

In May 2010, the Greek government agreed to a fiscal adjustment equal to 16% of GDP from 2010 to 2013. As a result, Greece moved from a primary budget deficit (which excludes interest payments on debt) of more than 10% of GDP to a primary balance last year – by far the largest such reversal in post-crisis Europe.

The IMF initially projected that Greece’s real (inflation-adjusted) GDP would contract by around 5% over the 2010-2011 period, stabilize in 2012, and grow thereafter. In fact, real GDP fell 25%, and did not recover. And, because nominal GDP fell in 2014 and continues to fall, the debt/GDP ratio, which was supposed to stabilize three years ago, continues to rise.

Blanchard notes that in 2012, Greece agreed “to generate enough of a primary surplus to limit its indebtedness” and to implement “a number of reforms which should lead to higher growth.” Those so-called reforms included sharply lower public spending, minimum-wage reductions, fire-sale privatizations, an end to collective bargaining, and deep pension cuts. Greece followed through, but the depression continued.

The IMF and Greece’s other creditors have assumed that massive fiscal contraction has only a temporary effect on economic activity, employment, and taxes, and that slashing wages, pensions, and public jobs has a magical effect on growth. This has proved false. Indeed, Greece’s post-2010 adjustment led to economic disaster – and the IMF’s worst predictive failure ever.

Blanchard should know better than to persist with this fiasco. Once the link between “reform” and growth is broken – as it has been in Greece – his argument collapses. With no path to growth, the creditors’ demand for an eventual 3.5%-of-GDP primary surplus is actually a call for more contraction, beginning with another deep slump this year.

But, rather than recognizing this reality and adjusting accordingly, Blanchard doubles down on pensions. He writes:

“Why insist on pensions? Pensions and wages account for about 75% of primary spending; the other 25% have already been cut to the bone. Pension expenditures account for over 16% of GDP, and transfers from the budget to the pension system are close to 10% of GDP. We believe a reduction of pension expenditures of 1% of GDP (out of 16%) is needed, and that it can be done while protecting the poorest pensioners.”

Note first the damning admission: apart from pensions and wages, spending has already been “cut to the bone.” And remember: the effect of this approach on growth was negative. So, in defiance of overwhelming evidence, the IMF now wants to target the remaining sector, pensions, where massive cuts – more than 40% in many cases – have already been made. The new cuts being demanded would hit the poor very hard. [Cavallo y Norma Plá; se acuerdan?]

Pension payments now account for 16% of Greek GDP precisely because Greece’s economy is 25% smaller than it was in 2009. Without five years of disastrous austerity, Greek GDP might be 33% higher than it is now, and pensions would be 12% of GDP rather than 16%. The math is straightforward.

Blanchard calls on Greece’s government to offer “truly credible measures.” Shouldn’t the IMF do likewise? To get pensions down by one percentage point of GDP, nominal economic growth of just 4% per year for two years would suffice – with no further cuts. Why not have “credible measures” to achieve that goal?

This brings us to Greek debt. As everyone at the IMF knows, a debt overhang is a vast unfunded tax liability that says to investors: enter at your own risk. At any time, your investments, profits, and hard work may be taxed away to feed the dead hand of past lenders. The overhang is a blockade against growth. That is why every debt crisis, sooner or later, ends in restructuring or default.

Blanchard is a pioneer in the economics of public debt. He knows that Greece’s debt has not been sustainable at any point during the last five years, and that it is not sustainable now. On this point, Greece and the IMF agree.

In fact, Greece has a credible debt proposal. First, let the European Stabilization Mechanism (ESM) lend €27 billion ($30 billion), at long maturities, to retire the Greek bonds that the European Central Bank foolishly bought in 2010. Second, use the profits on those bonds to pay off the IMF. Third, include Greece in the ECB’s program of quantitative easing, which would let it return to the markets.

Greece would agree to fair conditions for the ESM loan. It does not ask for one cent of additional official funding for the Greek state. It is promising to live within its means forever, and rely on internal savings and external investment for growth – far short of what any large country, controlling its own currency, would do when facing a comparable disaster.

Blanchard insists that now is the time for “tough choices, and tough commitments to be made on both sides.” Indeed it is. But the Greeks have already made tough choices. Now it is the IMF’s turn, beginning with the decision to admit that the policies it has imposed for five long years created a disaster. For the other creditors, the toughest choice is to admit – as the IMF knows – that their Greek debts must be restructured. New loans for failed policies – the current joint creditor proposal – is, for them, no adjustment at all.

***

Nuestra reflexión es la de siempre: no es que el FMI se equivoque o esté lleno de imbéciles irrecuperables que caen siempre en el mismo error. No, chicos, no hubo errores, no hubo excesos. El FMI hace muy bien las cosas: te endeuda, te revienta económicamente, y deja tu país devastado, a precio de remate para comodidad de los "inversores" (los que terminan comprando todo: fábricas, infraestructura, servicios y, sobre todo, tierra). El Recurso de la Deuda es una herramienta eficaz para mantener en caja a pueblos y gobiernos. Para ello tenés, por un lado, al FMI; por el otro, a José Alfredo y sus nietitos.