Greece is the horse's head in the left's bed

The best thing that can be said of the weekend is the brutal honesty of those perpetrating this regime change. Wolfgang Münchau - Financial Times

You may ask yourself why Germany, and those who follow her, are publicly torturing and humiliating tiny Greece in such a brutally inflexible and ugly fashion, ignoring contemptuously the democratically expressed will of the Greek people and much of European and even world opinion.

The reason behind it is simple... and to be effective it would have to be.

Frank and open brutality is never subtle, that is the whole point: its message must be clear to all.

The following is an excellent exposition of the message, "to whom it may concern" that has been sent  far and wide, using the misery of the Greek people as its vehicle:

One cannot pursue an even moderate left-wing policy in a system of global capitalism. Syriza never got a chance to apply any of the leftist policies that it says it favors, because it was busy negotiating with the creditors and because it had no genuine freedom of economic decision-making, since basically all its policies were dictated by the troika. Even if it had a margin for maneuver, it is hard to see how its moderately leftist policies (halt to privatization, higher taxation, greater role for the public sector) could be implemented. Notice that we are talking here not of some radical anti-capitalist program but of just broadly leftist policies that try to limit somewhat the unimpeded invasion of the market and private interest into all social spheres. Such policies are obviously unacceptable not only to the mainstream EU but also to many individual governments, which fear Syriza-like movements in their countries. Branko Milanovic - Al Jazeera

However brutality is often a sign of weakness, not of strength. The heartless, tone deaf response of Angela Merkel and Wolfgang Schäuble to the suffering of the Greek people reminds me and many others of the Soviet Union's response to the timid Czechoslovakian liberalization of the "Prague Spring" of 1968.  That was 1968 and "something was in the air", something contagious and the USSR wanted to make sure that no one under their rule "got any ideas" .

Paris - 1968

Today there is also "something in the air". Probably the most influential public figure to speak clearly about that "something" is Pope Francis.

The earth, entire peoples and individual persons are being brutally punished. And behind all this pain, death and destruction there is the stench of what Basil of Caesarea called “the dung of the devil”. An unfettered pursuit of money rules. The service of the common good is left behind. Once capital becomes an idol and guides people’s decisions, once greed for money presides over the entire socioeconomic system, it ruins society, it condemns and enslaves men and women, it destroys human fraternity, it sets people against one another and, as we clearly see, it even puts at risk our common home. Pope Francis: Speech at World Meeting of Popular Movements

The public humiliation of Greece, its government and its people may have exactly the opposite effect to the one Merkel and Schäuble desire. It is certainly a lesson to be learned, but the lesson people take away from this "class" may be one of greater political consciousness, one of unity and resistance, and not one of fear and submission. DS

What is really behind the Ukraine crisis

Russia's reaction to the move to overthrow Ukraine's government, take it into the EU and from there, probably into NATO was the most predictable thing in the world, just the sort of thing that George H.W. Bush, Kohl, Mitterrand and yes, even Margaret Thatcher wanted to avoid. In American terms imagine Washington's reaction if a Panamanian Hugo Chavez allied Panama with Cuba, filled the Canal Zone with Cuban advisers and threatened to close it... the marines would be there the next day. That is more or less what the Ukraine means to Russia. So Putin reacted in a totally predictable way. History is full of great wars that began with less cause. It is logical to think that the result we have before was calculated to benefit someone. Why deliberately take the risk of cornering a major atomic power in its traditional space?

Why would anyone else but Russia take such enormous risks for such a broken, corrupt, mess as Ukraine?

When you want to understand a major international crisis, or almost anything else for that matter, one of the first things to do is to take a step back and try to fit it into the "big picture". 

In international affairs, that is best done by reading history and studying maps.

The Ukrainian crisis is splitting Europe apart and turning Russia into an "enemy" again.

When I step back and look at maps and history, I come to the conclusion that Ukraine is merely a handy tool in a much larger operation, which is to interrupt and foil any and all efforts by the Chinese, Russians and the Europeans to create a Euro-Asian "prosperity sphere", bringing fluid movement of goods to and from China, by land from Europe across Russia and Asia. Think of all the synergies of European added value, brands and know how, combined with Russia's natural resources and technology all plugged into China's enormous markets and efficient mass, low-cost manufacturing.

The only real obstacles to this flow, Asia/Europe/Asia are political and even during the Cold War it went on quite a bit. For example, in the 1960s, before cheap flights, many Japanese students who wanted to visit Europe, used to take the boat from Japan to Vladivostok, from there the Tran-Siberian Express to Moscow, thence to Warsaw and finally Paris. In those same years a Canadian friend of mine made his first trip to India in a Volkswagen minibus.

It worked like this: a German fellow used to buy second hand minibuses in Stuttgart, load them up with hippies to pay the gas and then drive all the way to India, sell the bus (it was illegal to import them into India and he sold them for an enormous profit) and then he'd fly back to Germany and start the process all over again. 

The bus full of hippies drove through the Shah's Iran, from there though Afghanistan, where, before the CIA invented the Taliban and Al Qaeda, Kabul was filled with girls in miniskirts and cheap opium and hashish (hippy paradise) and from there across Pakistan and into India.

Off and on going back to Marco Polo and beyond, that is how the world more or less worked; interrupted by an occasional crusade now and then: caravans buying and selling across frontiers, languages and cultures, for hundreds and hundreds of years.

Analyzing how and why that is no longer possible would teach you volumes about modern history and its mechanisms.  The idea of fluid communication and trade Europe/Asia/Europe is nothing new, it is like the law of gravity... What is abnormal are the obstacles: they are all political.

With that in mind let us look at China's "New Silk Road" initiative, which, with all the hoohah in Ukraine, is getting very little coverage in the press these days. Some of my readers will only know "Silk Road" as a website where drugs can be acquired  anonymously, but the original Silk Road story is a bit more interesting than that. You can read up on the original version in Wikipedia.

Below you'll find Xinhua's map of China's "New Silk Road" project.

The new "Silk Road"

Before going on it would be well to remember that the World Bank expects China to become the world's largest economy sometime in 2014:

Many economists expect China to eclipse the U.S. as the world's largest economy sometime in the next few decades, but new World Bank data suggests that the transition could come much sooner. Is China ready now to assume its spot as the world's No. 1 economy? If so, what does it mean for the U.S., investors, and you? Motley Fool

With that in mind read the following:

The maps of the two Silk Roads drive home the enormous scale of the project: the Silk Road and Maritime Silk Road combined will create a massive loop linking three continents. If any single image conveys China’s ambitions to reclaim its place as the “Middle Kingdom,” linked to the world by trade and cultural exchanges, the Xinhua map is it. Even the name of the project, the Silk Road, is inextricably linked to China’s past as a source of goods and information for the rest of the world. The Diplomat

Here is how it connects to Europe:

DUSSELDORF, Germany, March 29 (Xinhua) -- Chinese President Xi Jinping Saturday called on China and Germany to work together to build the Silk Road economic belt. Xi made the remarks during a visit to Port of Duisburg, the world's biggest inland harbor and a transport and logistics hub of Europe. He said China's proposal of building the Silk Road economic belt, based on the idea of common development and prosperity, aims to better connect the Asian and European markets, will enrich the idea of the Silk Road with a new meaning, and benefit all the people along the belt. China and Germany, at the opposite ends of the belt, are two major economies that serve as the driving engines for economic growth respectively in Asia and Europe, Xi noted.

How does Russia fit into this? Now look at this map:

What or who is missing in all these maps and snippets?

The United States of America, that's what. 

The USA is nowhere in this picture... out of the loop... We can't have that can we?

What to do?

Double, double toil and trouble; fire burn, and caldron bubble. That's what. DS

Homage to the people of Greece - Αφιέρωμα στους ανθρώπους της Ελλάδα

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Wolfgang Schäuble, German finance minister, on Wednesday went so far as to suggest Greece might postpone its elections and install a technocratic government free of all political parties, similar to Italy, to ensure that the bail-out programme is implemented. Financial Times

A visibly angry President Karolos Papoulias singled out Schaeuble after he appeared to suggest Greece might go bankrupt, and also attacked critics of his country in the Netherlands and Finland. "I cannot accept Mr Schaeuble insulting my country," said Papoulias, an 82-year-old veteran of Greece's resistance struggle against the Nazi occupation of World War Two. "Who is Mr Schaeuble to insult Greece? Who are the Dutch? Who are the Finnish?" he said in a speech at the Defense Ministry. Reuters

No further comment needed. DS

Better watch out for the cucumber that ate Hamburg, for he may eat your city soon

The number of people hit by a massive European outbreak of foodborne bacterial infections is a third bigger than previously known and a stunningly high number of patients suffer from a potentially deadly complication than can shut down their kidneys, officials said Wednesday. Associated Press

You'd better watch out for the eggplant that ate Chicago,

For he may eat your city soon.

You'd better watch out for the eggplant that ate Chicago,

If he's still hungry, the whole country's doomed.

The Eggplant that Ate Chicago

Is this “simply” a very bad on-farm breakdown of Good Agricultural Practices? Is the outbreak the result of an exceptionally toxic warehouse somewhere in the supply chain? Could it possibly be agro-terrorism, as unthinkable as that prospect is? - The Packer

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"Could it possibly be agro-terrorism, as unthinkable as that prospect is?" That is a haunting phrase if ever there was one.

Reasons for thinking it could be:

• Osama bin Laden was killed recently and Al Qaeda has promised a spectacular response.
• Documents captured way back in Tora-Bora days, showed that even at that time Al Qaeda was investigating using human feces cultures to develop deadly pathogens as a simple, cheap method with which to sabotage the enemy's (our) food distribution systems.
• It is doable. Wholesale food distribution, loading, unloading, classifying, re-packing for retail: the vegetables and fruit we eat pass through countless hands on the way to our tables and many of those hands are minimum wage immigrants, therefore the selection of employees cannot be very rigorous... it is proving immensely difficult to determine exactly where the infection has its origins.
• As we can see with the German, "cucumber panic" our food distribution systems, with their huge volume, are complex, sophisticated and vulnerable.  Moreover, if anything affects them, it receives enormous media coverage everywhere, because the idea that the food we buy in the supermarket might kill us is extremely disturbing to modern city dwellers entirely dependent on said distribution systems. If this proved to be Al Qaeda's work the resulting terror and paranoia would be indescribable
• German public opinion is very unenthusiastic about Germany's participation in the war in Afghanistan and generally hostile to German military adventures of any kind. Jihadists poisoning cucumbers to kill German hausfraus might be the straw that breaks the camels back and has them running for the Afghan doors.

At this writing we don't yet know the exact causes of this infection, which is drawing the fascinated horror of the developed world. And even if turns out to be only fortuitous or simply human error or cupidity, we have been given a sobering reminder of how artificial our world has become and how helplessly vulnerable we might find ourselves in the midst of all our power and wealth. DS

Tales of Globalization: USA and India: a marriage made in... heaven?

"I believe that the relationship between the United States and India will, in fact, be one of the defining partnerships of the 21st Century." President Obama - BBC News

The most dramatic and remarkable improvement in consumption has been of those who were already the richest people in India – that is the top 20 per cent of the urban population. (...)  the most dramatic evidence is for the bottom 80 per cent of the rural population – well more than half of India’s total population. For these people, who now number nearly 600 million, per capita consumption has actually declined since 1989-90. In other words, even the official statistics of the government still show that more than half of India has lower consumption per person than more than 10 years ago, after a decade when national income were supposed to be growing at around 6 per cent!  International Development Economics Associates

C.E.O.’s of the largest American companies earned an average of 42 times as much as the average worker in 1980, but 531 times as much in 2001. Perhaps the most astounding statistic is this: From 1980 to 2005, more than four-fifths of the total increase in American incomes went to the richest 1 percent.  Nicholas Kristof - New York Times

"The German export successes are not the result of some sort of currency manipulation, but of the increased competitiveness of companies. The American growth model, on the other hand, is in a deep crisis. The United States lived on borrowed money for too long, inflating its financial sector unnecessarily and neglecting its small and mid-sized industrial companies. There are many reasons for America's problems, but they don't include German export surpluses." German Finance Minister Wolfgang Schäuble - Der Spiegel

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For me the quotes above tell a story all by themselves... Writing further comment approaches "gilding the lily".  It would be possible to rearrange them in any order and they would always tell the same story. Still, I'll try and riff a little bit on them.

The comparisons between the USA  and India are painfully apt: in the USA the top 1% of the population owns 42.7% of the country's wealth and the bottom 80% of the population owns only 7%. In India the top 1% owns 16% of the wealth, while the bottom 80% owns 30% of India' wealth. So we can see the Indians have some catching up to do, because US income distribution  is more unequal than India's.

What do the top one percent of India and the USA buy with their wealth?

Probably they buy German cars, washing machines, stoves, etc, for their homes and German capital goods for their factories (the American factories are mostly in places like China and Mexico these days). 

Why do the rich buy German stuff?

Because if you can afford it, you want the best and the Germans still make the best. They train their workers so well that despite paying  them high wages they are still competitive. They are competitive because of the enormous added value that well trained workers can add to a well engineered product. 

Once upon a time you could say the same thing about the USA too.

Wolfgang Schäuble is cruel but truthful when he says:

The United States lived on borrowed money for too long, inflating its financial sector unnecessarily and neglecting its small and mid-sized industrial companies.

He might have added that you can't digitize a BMW or a Miele washing machine and download them from The Pirate Bay. The "intelligence economy" is all very well, but brains are equitably distributed around the world, and computers are cheap and easy to assemble by semi-skilled workers...  but people who can do the fit and finish of a Porsche are neither equitably distributed nor cheap.

So, yes, I am afraid the president of the United States is correct in saying that India and the United States will define each other in the coming century: India reaching America's level of inequality and the USA perhaps developing an Indian-like caste system. DS

British in need of reality check

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The other day I went to a debate in a big Spanish bank about the EU and the “crisis”, which was held under the “Chatham House” rule so I can use the information, but I can’t reveal the names of the participants. I’ll just say that the star speaker was a very prominent British journalist, specializing in EU affairs. His greatest complaint was that the Germans no longer just signed the checks and silently nodded agreement to everything that the USA, Britain and France requested and that they had a strategic understanding with Russia due to energy.

Listening to him talk, I got the feeling that his reality was much more British weighted than reality itself is.

Germany is the most important country in Europe both economically and demographically and as the journalist pointed out they are no longer docilely following the traditional, "Russia out, America in and Germany down" script. And as the journalist also mentioned, if there is any bailing out to be done in countries like Greece or points east, it will be the Germans who do the bailing. It seems to me that this adds up to a very German slant to things in the near future. Who else is there, when you really come down to it?

Britain? France?

As the journalist also pointed out, the euro-skeptic Tories who detest the EU are set to win the next UK election and if we add to this that the British economy is now like some cratered giant Iceland and its financial industry disgraced (manufacturing left ages ago)... then except for Tommy Atkins, what else has Britain got left to sell, lease or rent?

As for the French, Sarkozy has tardo-Bush popularity levels and his enthusiasm for NATO and Afghanistan are not shared by the French people in any poll I've seen.

Except for the British government and Sarkozy does anybody anywhere in Europe in their right mind really want to see the Germans getting militarized ever again?

Since Af-Pak is going down the drain, at this very moment, the German reluctance to get any deeper involved in the coming debacle makes quite a bit of sense.

I would argue that the official German position fits EU public opinion better than either Britain's or France's.

So to sum up, the Germans are paying the piper and they are no longer reluctant to call the tunes. That for better or worse is the EU of today and tomorrow and the crisis is going to enhance that. They have the money, the population and their policies are more in tune with European public opinion... What could be more obvious? DS

Osama bin Laden and Fritz

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Fritz G is a whitebread German who converted to Islam and was planning to plant a bomb. Here is the number one western security nightmare: suicide bombers who are not subject to "racial profiling".

Islam, like any other of the great world religions is in conflict with the values of capitalism: individualism and greed, and there is no reason that brown skin goes invariably with the Shahadah.

Where else could alienated and disaffected young people turn today if they are looking for a revolution? DS

Among the Believers - Die Zeit - Wall Street Journal
Abstract: It had to be Fritz. A name can't get much more German than that. And of all places it had to happen in Sauerland, a remote region in Germany that invokes about as much the specter of a "parallel society" as a gardening club. The amount of explosives 28-year-old Fritz G., 22-year-old Daniel S. and Adem Y., a 28-year-old Turkish-German, had prepared in an inconspicuous vacation home would have been many times more destructive than the Madrid and London bombs.(...) In comparison to Great Britain, Spain or France, Germany thought itself comparatively safe. First, because it was not involved in the Iraq war, it hoped al Qaeda would grant the country some sort of bonus. Second, because most of the roughly three million Muslims in Germany come from Turkey, where the separation of religion and politics is state doctrine. They were thus thought to be more or less inoculated against extremism. How different, one thought, from the U.K., where the majority of Muslims come from Pakistan, a country founded in religious conflict and an exporter of fundamentalism. Or France, which made its Muslims citoyens but whose Algeria war still preoccupies the minds of the present immigrant generation. Given the alarming fact that a son of Turkish immigrants was involved in the Sauerland plot, the inoculation can no longer be considered absolute. What's more, it looks as though the home-grown phenomenon has not only reached Germany, but has even skipped a developmental stage. Fritz G. and Daniel S. did not become extremists through cultural Islam. They took the direct route to political Islam. The phenomenon of extremist converts should worry us for it shows that Islam can be decoupled from its native religious and cultural background. Al Qaedism is becoming a universal, radical ideology of protest. Young Westerners in search for the most brutal anti-Western position find Osama bin Laden's ideas seductive because they are ethically hermetic.(...) (bin Landen) has very consciously begun fishing for supporters who share the backward concept of Islamism for non-religious reasons. The secular religions of climate rescue and globalization criticism meet bin Laden's doctrine of divine salvation. Disillusioned of the world, unite! "Wherever the believer happens to be, he is part of a virtual society, with which he shares the same set of norms," writes the French Islam expert Olivier Roy about the attraction of Islamism. "Only two radical protest movements in the West still claim to be internationalist: the anti-globalization movement and radical Islamists.... Al Qaeda has clearly occupied an existing space of anti-imperialism and protest.... Al-Qaeda is a successor to the ultra-left and third-world movements." READ IT ALL