Italian Economist Sees Euro Currency as Harmful, Likewise Germany's Stifling Role

Paolo Savona is an Italian economist of the older generation. A veteran official at the Italian central bank, the Banca d'Italia, he was nominated by the two main political parties in Italy, the Lega [League] and the Movimento Cinque Stelle [Five Stars Movement], to be minister of finance when the Italian government was being formed last May and June [2018]. But Savona's positions on the euro currency and German domination in the single currency [euro] zone were anathema to the EU/Eurozone and to various domestic Italian interests.
His views were summed up by the Wall Street Journal:
Savona . . . sharply criticized the euro and compared the dominant role of Berlin in determining Eurozone financial policy to Nazi German aggression in the Second World War. [Globes, 5(29-30) 2018]

In any event, the president of Italy, Sergio Mattarella, nixed Savona's appointment as finance minister on the grounds that a new government with Savona as finance minister might endanger Italy's membership in the Eurogroup [that directly sponsors the Euro currency]. Now, criticism of the EU and its institutions and Germany's role in particular are nothing new in Italy. Former socialist Prime Minister Matteo Renzi sharply criticized the EU and Germany's dominant role in it [here].

In any case, the man who did become finance minister in the new government, Giovanni Tria, was quite conciliatory towards the Euro and the EU. In contrast to Savona. But he too indicated tensions with the EU and the Eurogroup, Germany in particular, but France as well that --under Macron-- wants to expand the powers of the EU central authorities in Brussels through greater political and financial integration of the Eurogroup [the single currency group] and the EU. Tria told an interviewer:
"Look, paying attention to keeping the accounts in order and to bringing down the debt  is not appropriate because Europe tells us but because we should not take the chance of damaging confidence in our financial stability"[qui Corriere della Sera, 9 (modified 10) June 2018; Eng. trans. here]. Thus Tria expresses fear of what the Eurogroup and Germany in particular will say or do if Italy acts in such a way as to damage their confidence in Italy's financial stability. Nevertheless, as long as Germany enforces an austerity policy on Greece, Italy and other Eurozone states, economic growth in the Zone will be low --and it is now low in Germany too. But the Germans and the Brussels bureaucrats, the unelected rulers over millions --sometimes called Eurocrats-- are rigid. Thus needed changes will not be made or only very slowly and too little will be done in the way of changes out of the austerity straitjacket. The Greek case is blatant because the country cannot pay its debt in the long term --debt which was mostly incurred by the initial refusal of Germany led by Wolfgang Schaeuble to help Greece keep up with a smaller debt than now starting in 2010. Even the International Monetary Fund, notoriously friendly to fiscal stinginess, now agrees that the Greek debt should be restructured if not forgiven in part. But this does not happen. German domination of the Eurogroup seems to be still intact.

We have already explained why the EU is  not democratic [here] and we believe that the more the EU integrates and centralizes control and regulations in Brussels (the EU parliament at Strasbourg hardly counts) the less democratic each member country will be.  That is the less democratic power or influence the various peoples of the member states will have over their own lives. This greater political and financial integration is what Macron is seeking. He gave a speech on this subject just the other day. However, looking at France today, what with the mass terrorist attacks and the Yellow Vest movement which opposes Macron's proposed reforms, reveals that things are not going smoothly in what French people call the Hexagon. Safety on the streets especially for Jews, but not only, cannot be taken for granted in France today. Maybe it is not Macron's proposed reforms that have brought France down --reforms mostly not yet implemented-- but the EU and Eurogroup policies that have been in effect up till now.

Yes, the dream of a united Europe has its attractions but the reality is not so rosy.
Knowing what we do about the EU explains to us why nothing good for Israel is likely to come out of the EU. Israelis and Jews generally have to start seeing the EU as a body that cannot act for the best of its own several peoples let alone helping to bring peace to Israel and the Middle East generally.

Some of the Bad Features of the European Union -- A German Dictatorship?

Just what is wrong with the EU? Why is it reasonable to doubt its continued existence after the 2020s? We know that the EU is governed by a central bureaucracy, located in Brussels, which makes decisions, according to its authority deriving from the treaties that set up the EU. These decisions are subject to little democratic control, although representative bodies of the various member states meet from time to time and can theoretically oppose policies coming out of the Brussels HQ of the EU. However, what happens usually is that the representatives of the member state govts. are presented with faits accomplis, backed up, usually by Germany and the influential states of northwestern Europe.

Matteo Renzi, former prime minister of Italy, gives a glimpse into EU policy making or rather policy ratifying. He also indicates German hegemony over the EU which is reflected in the votes of the EU executive and representative bodies, the EU Commission and the EU Council (Council of Europe) respectively [the EU parliament has so little power that it's not worth dwelling on]. In a recent book Renzi writes that German prime minister, Madame Merkel, is considered by many in the Italian political world to be the "chief strategist of an anti-Italian vision." Renzi states that he respects "her and certainly does not agree in the least with those who point to her as the one responsible for Italian problems." Be that as it may, Renzi clearly shows that she so dominates EU politics that the EU Council members, governmental leaders in their own countries, fear to criticize or gainsay her:

". . . I realize that in the Council, she is so respected and involved in all the issues that few have the courage to contradict her publicly. Which is what I do on more than one occasion. The idea that nobody can allow himself to raise the least bewilderment over the German contradictions makes me angry. The exchanges with Merkel are difficult on many issues, from the flexibility of budgets [of member states] to the relationship with Russia . . . . [And] up to the regional German banks to whose questionable system of governance and control I am the only one to point explicitly and transparently --- and to the contradictions of Berlin's economic policy. . . .  Merkel does not appreciate the style with which I open --often deliberately-- debates in the Council but begins to  scrutinize me in order to understand me better. Over time, a collaborative relationship develops between us." [Corriere della Sera, 9 Luglio 2017]

Thus Merkel so dominates the Council that other leaders of government fear to contradict her. Meanwhile, problems in Germany are overlooked. Hardly a healthy situation for the EU.

Renzi goes on about Merkel. "The theme on which we are farthest apart is the economy. I believe that the policy of austerity adopted by the European Union is a tragic error." In this vein, Renzi also criticizes the EU response to the earthquake disaster in Italy in 2016:

"The earthquake shocks of the end of October 2016 did not cause any deaths only by a miracle. . . . . And what did the usually punctilious technicians of the European structure [the bureaucrats] do? While the houses are collapsing, they send you [= himself] a verbal extortion note in the form of a whisper to Italian journalists in Brussels --saying that the budget law of 2017 is good only if the deficit is subsequently reduced by 0.2%. . . . But how is it that they don't understand that, while we are all concentrating on support for the evacuees [from the earthquake], Europe should be in the basilica of the patron saint San Benedetto with its own heart, instead of choosing that moment to make a (marginal) request for settlement of the debt? This is what happens when politics abdicates to the technocrats. . . .  I want to shout to the European bureaucrats that in the face of pain, first of all  there is compassion, respect, empathy. And then, only afterwards, the technical stratagems. . . . Respecting the European rules, moreover, cannot be an ideological mantra" [Corriere della Sera, 9 Luglio 2017]

Maybe Renzi gave reasons why Guy Milliere was right when he agreed with my suggestion after a lecture here in Jerusalem that the European Union was a death pact, un pacte de mort.

Obviously, neither the European Union nor its member states can be a model for our Israel nor can we trust the EU to be wise or compassionate in its diplomacy in the Middle East and first of all we cannot trust the suggestions and proposals that the EU makes to us in order to --supposedly-- bring about peace for Israel. The EU is notoriously hypocritical and often enough self-destructive yet arrogant. We don't want to be members and the EU does not want us. And if a case in point is needed, take Greece which suffered from EU/Eurozone efforts to supposedly help them, as Luciano Fontana [chief editor of Corriere] indicated, the EU/Eurozone failed in dealing with the Greek Debt Crisis which began in 2010 and is still going on. Greece can never pay its current debt, most of which was incurred by Greece after it reported in 2010 an inability to pay interest on its debt at that time. The debt is now much greater than then after "bail-outs" by the Eurozone. And it cannot be paid off. And the Eurozone led by Madame Merkel whom Renzi describes above, does not want to forgive or even restructure the Greek debt. Maybe, it is hinted, we will do that after you have reformed as we wish, etc. More of that extortion that Renzi mentioned?

The hypocrisy is even worse when we recall that Madame Merkel's Germany did not have to pay WW2 reparations according to a postwar treaty, nor did it ever pay back more than a small part of the US Marshall Plan loans [some $15 billion in 1947 dollars], and even that small amount stayed in Germany; nor did Germany pay its full war reparations debt to France for WW One. And the EU finances a host of so-called "civil society" NGOs that work to undermine Israel's standing in the world and Israel's society.  Hence Israel must be very wary in its dealings with the European Union. It is not a friend.
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Reference on EU government -- edulcorated to be sure
Pascal Fontaine, 12 Lecons sur l'Europe (Bruxelles: Commission europeenne 2007), pp 16-21.
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Renzi's reference to San Benedetto is to the Christian Saint Benedict, the patron saint of Europe in
Christian tradition and belief.

Fantasy & Reality about the European Union

Many people make a rather good living off the European Union. Besides, gourmet food is often served in the Brussels headquartes of the EU. There are the bureaucrats in Brussels and elsewhere plus the elected members of the European parliament. The pay is better than average and often better than for comparable jobs in the home country of the bureaucrat or parliamentary deputy.

Hence, many have little reason or inclination to rock the boat with sustained and substantial criticism of the EU. What some do is to let out a little mild criticism of a particular policy or person or making a general criticism in a vague fashion while at the same time extolling the EU's lofty purposes [supposedly lofty]. That's what Antonio Tajani --president of the EU's parliament-- did when speaking to a group of influential people back home in Italy:

"The European Union is in the midst of fording the river. There are many things that don't work but more Europe is needed, not less. Leaving it means suicide, as many in the United Kingdom are realizing and even Marine Le Pen understands that the war on the euro [currency] is a mistake."
[Corriere della Sera, 9 Luglio 2017; emph. added]

The reader will make up his own mind as to how sensible that reasoning is. But before we analyze it, here's some reality from the chief editor [direttore] of Corriere della Sera, Luciano Fontana:

"Europe --the chief editor of Corriere observed-- has become a major actor [protagonista] in our lives. and even in our election campaigns. A Europe that often makes mistakes, [a Europe] whose management of the Greek crisis and the migrants cries out for revenge."
[Corriere, 9 Luglio 2017]

There are many things wrong with the EU which was likely the main reason that British folks voted against the EU and for Brexit more than a year ago. Despite its lofty rhetoric, the EU is very undemocratic in that decisions are made in Brussels by EU appointed officials rather than by national parliaments whereas according to the EU treaty, the Brussels officials can overrule laws passed by national parliaments, although this power can be challenged. But the Brussels bureaucracy is much less responsive to local needs, desires and conditions than national parliaments are. And then these Brussels officials like to impose a one-size-fits-all policy on all of the EU countries which of course have their own local traditions, histories, conditions, political environment. And obviously this causes resentment throughout the EU.

Then we come to the Euro currency, the single currency which is legal tender in most EU countries which gave up their national currencies to join the single currency zone. That was a bad idea whose time had come. Imagine. A single currency was imposed on some fifteen countries without a common tax policy/tax laws/, without a common pension system, a common state budget, common labor laws, so on and so forth. As no doubt was predicted the currency has great problems and one major victim --Greece, although other countries have suffered as well. To be sure, tourists who travel from one Eurozone country to another find traveling simpler [because they don't need to change currency with every new country that they come to]. Otherwise, few benefit. Un disastro, an Italian friend told me. We could go on about the EU's faults. But rather than be tedious, let's go on to Signor Tajani's logic and common sense.

"many things . . . don't work but more Europe is needed, not less". "More Europe" in the words of the Brussels crowd means closer political integration within the EU and more central control of the lives of EU citizens. But Tajani has already told us that many things don't work in the EU. So why would he think that "more Europe" would be better rather than worse? Does the centralized bureacuratic system of the EU where decisions are made far from the governed and often against their will and/or their better judgment, seem to be capable of doing a good job when and if it has more political power than now? We can go and on and maybe we will.

European Union Tortures Greek Fellow Europeans - What Can Israel Expect from the EU?

In January 2012 the EuroZone, the countries sharing the single currency, the euro, demanded extreme austerity from Greece. One of the provisions of the set of demands on Greece was to reduce medical benefits for the Greek population [veda qui].

We can now see the effect of these draconian demands. The French daily Le Figaro reported one and a half years ago, July 2015, on the gloomy picture. That is when Greece accepted a further set of harsh austerity demands by the EuroGroup which runs the EuroZone. I have no doubt that the situation now is worse than in 2015. Le Figaro writes:

Elevators out of service, tired greenish linoleum, a corridor burdened with patients abandoned on rolling beds. Over-aged medical material and medications that are running out. Austerity. At the Evangelismos Hospital in Athens, "We know what it is." . . .   

We hear them speaking harshly to each other . . .  "Go in front of me? Do you take yourself for a German?" exclaims an irritated fifty-year old  waiting his turn at the window where medicines are given out. "We're all worn out," another patient makes an excuse. "We mustn't complain," sighs Denise, an epileptic, 40 years old who subsists with her daughter  thanks to a disability pension of 300 euros per month. "We still have free medications." . . . . "I try to survive as best I can," chief cardiologist Dr Ilias Zarkos confides.  "At the  age of fifty-five I earn 1320 euros per month, as against 1600 euros four years ago. . . . In the past five years, we have all had our salaries reduced, and 20% of the staff went on retirement without being replaced. . . . Who would want to work under these conditions? Greece is now naked." "Every year the subsidies and equipment provided to the hospital are reduced by 15%," Dr Sioras continues. [Le Figaro, 15 Juillet 2015]

That is the state of Greek hospitals as of July 2015. That is the result of years of EU austerity treatment for the original debt crisis, whereas Greek debt as of July 2015 and as of now too, is worse, is higher than in 2010 when the debt crisis first came to light. Sometimes the remedy is worse than the disease.

If the Greeks were perhaps an exotic tribe in Africa or on the island of Borneo or some decidedly Third World country, would the EU be so callous to their suffering? Would the hospitals have to make do with short supplies and out of date equipment and supplies and reduced staff? Wouldn't Europe's supposed charitable and humanitarian instincts take over and wouldn't the cries for help be answered? Where is the solidarity for fellow Europeans, whereas solidarity is supposed to be a fundamental principle of the EU? Indeed, solidarity may be located in the same place as another EU principle, transparency, another EU value which is honored as much in the breach as the observance.

Besides, when the Palestinian Authority, a new form of the old PLO, is short of funds, somehow the EU finds the money. But the same generosity does not show up for the Greeks, for their fellow Europeans who are suffering. Nor does the supposed EU principle of transparency come into effect when it comes to funding a whole array of anti-Israel NGOs .....

The EuroGroup policy toward their fellow European Greeks is harsh and callous, and unproductive. What is their attitude toward Israel? Do they any longer recognize the Jewish right to live throughout the Land of Israel (Palestine in their parlance) west of the Jordan,  as the international community had decided in 1922 in the Mandate for Palestine issued to the UK for the purpose of erecting the Jewish National Home?  Today old commitments are forgotten. In fact, prominent EU member states voted at the UN Security Council for a resolution calling it a crime for Israelis to live east of the Green Line, the 1949 armistice line, even in Jerusalem, a city that has had a Jewish majority since 1853, if not before, whereas all Jews were ethnically cleansed from parts of Jerusalem --including the Old City's Jewish Quarter-- that were under Arab control after the 1947-1949 Israeli War of Independence. So the EU states represented in the UN SC favored apartheid against Jews by proclaiming that Jewish residence east of the Green Line, in Jerusalem too, was illegal according to international law, no less. That is what UN SC resolution 2334 has to say. Those EU states want to return Jews to their traditional status in Europe in the Middle Ages where often Jews were forced to live in ghettoes. Indeed, this demonstrates the cyclical nature of history. Out of the ghetto, now back to the ghetto.

Israel can hope for nothing decent at the upcoming French-sponsored "peace conference" in Paris. Bear in mind that the words, working-for-peace, can really mean working for war. There are strong grounds for assuming that the Paris war conference due to start on January 15 is meant to produce a resolution that will be taken to the UN Security Council before Donald Trump is inaugurated as US president on 20 January 2017 in order to prevent him from interfering in the gang up on Israel which Trump has already defined as "unfair". The Paris-to-New York time schedule is tight but possible. As the example of Euro treatment of Greece demonstrates, the EU and its member states can be not only stingy but harsh and cruel. Can Israel expect better from the EU after nearly 2000 years of discrimination and oppression of Jews and often of persecution?
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For more on the Eurozone's treatment of Greece, as well as the contrast between favoritism for the PLO/PA contrasted with stinginess with Greece, see here & here .

A quote from Il Sole-24 Ore (30 January 2012) on proposed reductions of medical coverage for Greeks:

Sul fronte previdenziale, la Troika fa notare che il 50% dei medicinali rimborsati dal sistema sanitario pubblico è generico, con prezzi bassi (e che vi è quindi spazio per ridurre l'esborso di denaro pubblico). [Il Sole-24 Ore, 30 Gennaio 2012  qui] 

Greece Opposes Labeling of Goods from Jewish Settlements

Greece has many reasons to resent the European Union, which has hardly treated Greece with brotherly and sisterly solidarity in the case of its debt crisis. In fact, the solutions to the Greek debt crisis, originating mainly in Germany at the German central bank, the Bundesbank, and adopted by the Eurozone, made Greece's debt crisis much worse than it had been before Greece turned to the Eurozone bodies for help, as we have shown in a number of previous posts.

Moreover, the Republic of Cyprus with its ethnic Greek majority that once aspired to join their island to Greece, has been occupied in part since 1974 by Turkey. That was 41 years ago. Some 200,000 Greek Cypriots were "ethnically cleansed" by  the Turkish invasion of the island, and fled to the south of the island as about 35 to 38% of the island was left occupied by Turkey. Or some would say that they were "displaced" in the euphemistic language generally used in the mainstream international press when writing about the Turkish invasion of Cyprus. Since then, the European Union to which both Greece and their brothers and sisters in Cyprus belong has had little to say in opposition to or criticism of the continued Turkish occupation. This contrasts with the constant EU criticism of Israel for allegedly "occupying" Judea and Samaria, the heart of the ancient Jewish homeland, called Ioudaia in Greek and IVDAEA (Judea) in Latin, both names pronounced about the same.

Furthermore, the international community had asssigned the Land of Israel, the former Roman province of Judea (roughly speaking), to the Jewish people as the Jewish National Home at the San Remo Conference, 1920, and the League of Nations, 1922. The Jewish National Home principle was supported by one of the leading Greek statesmen of the time, Eleftherios Venizelos.
As we know, the United Kingdom received a mandate from the League to foster development of the Jewish National Home. But the UK betrayed that commitment, most notably in the 1939 "Palestine White Paper."

Greece too was betrayed by its World War I allies, most notably France and the UK, who had promised Greece that it could take back Greek-populated territories in Anatolia, such as Smyrna and its hinterland, in return for supporting the Western Allies, the so-called Entente powers, in their war with Germany, Austria-Hungary (the Habsburg Empire) and the Ottoman Empire. The Supreme Allied Council dominated by the UK & France --two of the Principal Allied Powers-- hobbled Greece in its military operations in Anatolia so much that Ataturk's Turkish nationalists were able to defeat the Greeks after an intial Greek advantage and then drive out of Anatolia not only the Greek army but the ethnic Greek population of several million people [see "Smyrna" toward the bottom of the post] (1922). This was one of major instances of ethnic cleansing in the 20th century before WW2.

In another case of betrayal of promises, the EU claims that Judea-Samaria is "occupied" by Israel and constantly vilifies Israel's presence there. The EU also insists incorrectly that Geneva Convention IV 49:6 forbids Jews from moving into Judea-Samaria area because it is "occupied," as they allege. This racist, anti-Jewish policy has been most recently manifested in the call on EU member states to insist that products from Israeli/Jewish settlements in Judea-Samaria be labeled as such, that is, as products of an "occupied territory." This means that the EU wants to foreclose any need for Palestinian Arabs to negotiate with Israel what the future borders between Israel and a Palestinian Arab state will be. They want to force Israel to accept the PA/PLO's demands that Israel retreat to the 1949 armistice lines that were never borders, in order to have peace with the PA/PLO. And the EU wants to use the EU consumers to pressure Israel to submit, by not buying products from supposedly "illegal settlements". But no such pressure on Turkey is visible. Greece realizes that it cannot rely on the EU.

Greece set to oppose EU settlement labeling

Greek Foreign Minister Nikos Kotzias has sent a letter to Prime Minister Benjamin Netanyahu informing him of Athens’s opposition to the EU guidelines on the labeling of goods produced in Israeli settlements, The Times of Israel learns.

Kotzias’s message to Netanyahu came three day after Greek PM Alexis Tsipras visited Israel on Wednesday of last week.

Other than Greece, the only countries to break ranks on the measure are Hungary, which has declared its opposition; and Germany, which has yet to say whether it will implement it.

— Raphael Ahren Times of Israel
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More on the Greek position [here]. PM Tsipras also recognizes Jerusalem as Israel's "historic capital."

The Greek Crisis Shows the Stupidity of the Euro Currency Itself

Just a few thoughts that I have about the Greek debt crisis which is a crisis of the euro currency and the Eurozone itself.

Greek mismanagement of its state finances was a problem. But the main problem is the notion of the single currency itself. The euro was a bad idea whose time had come. The economic disparities between the member states of the eurozone were great, not to mention lack of a common tax system, pension system, state budget, labor laws, etc etc, plus Greece's special defense needs vis-a-vis Turkey, etc.

What happened to Greece was inevitable and could have happened to other eurozone states. After the Greek debt crisis became known in 2010 it was handled all wrong by the Eurozone which insisted on reforms --due to German domination--- rather than debt relief which at that time could have taken the form of eurobonds at a low interest rate which Greece could have paid at that time. Instead Greece was left to borrow for regular needs --as many countries, including the USA, do-- on the open market where interest rates on Greek debt inevitably shot up, and that should have been foreseen. So the Greek debt is much higher today than 5 years ago. And that is the fault of the eurozone, especially Germany/Schaeuble/Merkel etc.

Reforms yes, but not without an easy credit facility plus funds for investment in growth. Lebowitz is right but does not go far enough. Greece has offshore energy resources which Europe needs and could have invested in in order to help both Greece and the EU as a whole. But instead of funds for growth there was excessive austerity which destroyed rather than creating conditions for growth and getting out of the debt straitjacket

Germany benefitted from debt relief but it is ruled out when for Greece's benefit

UPDATING 7-13-2015 at bottom

The Greeks are still voting on the referendum whether or not to accept proposals by the creditor institutions for getting another tranche [slice] of loan money to pay off previous loans. Note that Greece was not offered money to finance growth, such as in developing Greece's off shore hydrocarbon deposits. Greece is being offered money to pay previous debts to those who are offering new loans. So Greece is in a vicious circle or trap.

The help that Greece needs is debt relief and funds to aid growth and development. Indeed, former Italian Prime minister Berlusconi --interviewed yesterday [by TG com 24]-- wished Greece to have a future of growth and sviluppo [= development]. But the creditor offers to Greece did not include aid for growth, without which Greece cannot pay off old loans in the future. Instead, they insist that old loans be paid. Debts must be paid is the principle that they pretend to uphold. But how short are their memories, especially those of the Germans!!!

After the general destruction caused by WW2, a German war, in all the countries attacked, and in Germany itself as well, West Germany, occupied by the USA, UK, and France, was loaned $15 billion in Marshall Plan money when a billion dollars was worth much more than today. All but a small part of that loan was forgiven and the rest stayed in Germany as so-called counterpart funds which were used by the USA to finance projects in Germany to help Germany. Moreover, under US leadership, the formerly German-occupied countries agreed to forego reparations payments. They gave up on their demands for compensation from Germany for material damages. Peter Coy describes the spirit of US policy:

On Sept. 6, 1946, U.S. Secretary of State James Byrnes gave a speech in Stuttgart, Germany. A movement was afoot to penalize the Germans for their role in World War II by deindustrializing the country. Byrnes opposed anything resembling economic spite and promised the country a fair chance to rebuild. “Germany is a part of Europe,” Byrnes said, “and recovery in Europe will be slow indeed if Germany with her great resources of iron and coal is turned into a poorhouse.” It became known as the Speech of Hope. [Peter Coy in BloombergBusinessWeek]

Greece too was led by the US to give up its demands for compensation as well as for return of gold reserves and forced loans taken by the German occupation army from the Greek state central bank.
Hence, we see that Germany enjoyed and benefitted from debt forgiveness after the vast destruction caused by WW2. But today Greece must not benefit from debt forgiveness nor even from debt restructuring to extend pay back periods and/or to reduce interest on old debt.

What's more nobody seems to want to recall that after WW One, also a German war, Germany agreed to pay reparations to France. The sum was huge and it seemed so to the German governments in the 1920s.  So what did the German govts of the time do to alleviate their debt, that is, to get debt relief?
They devalued their own currency, the deutschemark, and the French were paid off in cheap, nearly worthless deutsche marks. Greece cannot do that since its debt is denominated in euros and Greece's govt does not control the value of the euro which it cannot devaluate by its own decision.

Here is another example of how Germany benefitted from debt relief which it rules out when it is for the benefit of Greece. And the other major countries in the Eurozone go along with the present absurdity of creditors trying to squeeze blood from a stone.

Can Israel expect any humane treatment from diamond-hearted, self-righteous hypocritical Europeans?
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Also see links below:
European Union knows what is best for everybody else but cannot or does not want to solve some of its own problems. [here]
Eurozone is stingy with Greece, generous with Arabs claiming the Land of Israel [here]
Eurozone betrays its Greek Eurobrethren. What would they do to the Jews? [here]
Why Greece should vote No [here].
Was it deliberate policy to impoverish Greece by putting it into a debt straitjacket? [here]
See analysis by Committee for Abolition of Third World Debt towards bottom of link [here]
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UPDATING 7-13-2015 Investment fund manager David Einhorn sees political motives in the
Eurozone working to have Greece fail even if it hurts the rest of the Eurozone.

David Einhorn, founder of Greenlight Capital, said Europe’s leaders are prepared to let Greece fail to discourage other countries from electing populists.
“Europe is unwilling to allow Syriza a face-saving compromise, even if that means Greece collapses and the rest of Europe suffers” [Bloomberg here]

The Eurozone Put Greece in a Debt Straitjacket - Was It Deliberate?

It's obvious to almost everybody that the Eurozone never "rescued" or "bailed out" Greece from its debt crisis in 2010. Instead, the Eurozone or Eurogroup put Greece into a debt straitjacket or debt trap in which Greece's state debt soared because it was left to borrow on the open market where the interest rates demanded by private investors/lenders were sure to rise fast. Later, but too late, it was openly realized  --about 2012-- that Greece needed to borrow on easy terms because its state debt was soaring. But Greece was already in the debt straitjacket or trap from which it cannot get out. Someone estimated that it would take 180 years for Greece to pay off the debt mountain.

Now evidence has emerged that suggests --not absolute proof to be sure, which is not likely to emerge for many years-- that putting Greece into a debt trap may have been deliberate German policy. The purpose seems to have been to use the Greek example as a whip to scare other economically weak Eurozone member states. German finance minister Wolfgang Schaeuble is quoted as telling US secretary of the Treasury, Timothy Geithner, as reported by Peter Coy of Bloomberg Businessweek:

The upshot is that events are unfolding roughly as foreseen by the wily German finance minister, Wolfgang Schäuble: The disaster befalling Greece is scaring other European nations into following the straight and narrow. According to former Treasury Secretary Timothy Geithner in his book Stress Test: Reflections on Financial Crises, Schäuble told him in 2012 that—in Geithner’s words—some people were arguing “that letting Greece burn would make it easier to build a stronger Europe with a more credible firewall.”

This surmise of mine explains a lot, if true. Why do Germany and the Eurozone keep on insisting that Greece pay off debts made at inflated interest rates, debts which it cannot pay off for more than a century?
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Also see here, and below --
The economist Paul Krugman pointed out that Greece was in: "a vicious circle, with fears of default threatening to become a self-fulfilling prophecy."  here. Interestingly, former Italian prime minister, Silvio Berlusconi, also pointed out that Greece was in a "vicious circle" that it should be helped to get out of. He favored mutualization of state debt within the Eurozone.
European hypocrisy about human rights according to Michael Rubin on the Commentary blog, "The Lie that Europe Cares about Human Rights"  [here]

More European Greed, Failure & Hypocrisy: The Greek Case

We are all familiar with the moral pretensions and pretenses of Europe, particularly the European Union which embodies Europe's flaws quintessentially. They seem to know what is right for everybody else in the world, especially for Israel and the Jews. Just listen to us and you will have peace, they tell us. Why we should listen to them is beyond me, since I am old enough to remember that the Nazi Holocaust was perpetrated not just by Germans and Austro-Germans but was aided by most of Europe (by Arabs too but we're not talking about Arabs). Think of Quisling Norway and Vichy France and so on and so forth. Europe's world championship in hypocrisy is solid and unchallenged, as this Irish example bearing on Israel demonstrates. But even more striking is how the European Union  treats some of its own who appear to belong to a lesser class of Europeans.

The EU has never threatened Turkey with any sort of boycott for its occupation of northern Cyprus, whereas Cyprus, predominantly Greek ethnically, is a member of the EU itself. But there is obviously a lot of business to be done with Turkey or maybe the Greek Cypriots are just Europeans Grade B. Their brothers and sisters in Greece, also an EU member and a NATO member, suffer from counterproductive Eurozone schemes for settling their debt crisis. The Eurozone, a subsidiary comprising most EU members, imposed on Greece a terribly dysfunctional austerity plan that guarantees to keep most Greeks in poverty and does not encourage growth.

Anyhow Philippe Legrain in Foreign Policy updates some of the things that I and many professional economists have been saying for years [although I am not a professional economist, some big flaws in the "remedy" for Greece have been much too obvious]. Whatever the flaws in the economic plans to "help" Greece, their proposals for the Middle East  would work just as badly or worse if Israel adopted their plans to "help bring peace" to the Middle East. Here is Legrain:

Why Greece Should Reject the Latest Offer From Its Creditors

Debt bondage is destroying the country — for no good reason.

• BY PHILIPPE LEGRAIN
• JUNE 12, 2015
• 

Reform — Greece sorely needs it. Cash — the government is running desperately short of it. So it is time for Prime Minister Alexis Tsipras to do what’s best for Greece and accept its creditors’ reform demands in exchange for much-needed cash. That is how the Greek situation is usually framed. It is utterly misleading.

Imagine you’re in prison for not being able to pay your debts. (You’re right, it’s almost unthinkable — civilized societies no longer lock up bankrupt individuals. But bear with me.) After five years of misery, you lead a rebellion, take control of the prison, and demand your release. The jailers respond by cutting off your water supply. Should you back down and return to your cell, perhaps negotiating for slightly less unpleasant conditions, in order to obtain a little liquidity? Or should you keep fighting to be free? That, in essence, is what the standoff between an insolvent Greece and its eurozone creditors is really about.

For months, Greece has had “only days” to agree a deal with its creditors before it runs out of cash. Eventually that will be true. But even if Tsipras accepted the creditors’ demands, Greece would still have “only days” before it ran out of cash. The 7.2 billion euros on offer right now wouldn’t even cover the Greek government’s debt repayments until the end of August. And for a measly two months of liquidity, Tsipras is expected to surrender his democratic mandate: break his election promises, agree to yet more tax increases and spending cuts that would depress Greece’s economy further, and relinquish his demands for debt relief.

Then the wrangling would start again. Because so long as Greece remains in its debtors’ prison, it will be dependent on its jailers for liquidity and therefore expected to comply with whatever additional conditions they impose. Tsipras should not submit to this debt bondage.

Nine of every 10 euros that eurozone governments and the International Monetary Fund (IMF) have lent to the Greek government since 2010 have gone torepay its unbearable debts, which should instead have been restructured back then. But from now on, every last cent of additional funding would go to pay back debt. The Greek government now has a small primary surplus: It doesn’t need to borrow, except to service its debts of 175 percent of GDP.

Yet in exchange for additional liquidity, Greece’s creditors are demanding a return to the failed austerity policies of the past five years, which have shrunkthe economy by 21 percent and thrown one in four people — and one in two youth — out of work. The hypothesis that austerity can cure insolvency has been tested to destruction. Another dose of it would be perverse.

As Martin Sandbu of the Financial Times points out, further austerity isn’t even in the creditors’ interests. They are demanding a fiscal tightening of 1.7 percent of GDP in the second half of this year alone. Since raising taxes and cutting spending would depress the economy — shrinking tax revenues and inflating social spending, thereby unwinding some of the budget tightening — a fiscal squeeze twice as big would be required to achieve the creditors’ target, if the past five years are anything to go by. According to Sandbu, that would crunch the economy by 5 percent, perversely raising the ratio of debt to GDP by some 9 percentage points. To achieve a primary surplus of 3.5 percent of GDP by 2018, as the creditors are demanding, would require a fiscal squeeze of 8.3 percent of GDP, depressing the economy by 12.5 percent and increasing the ratio of debt to GDP by around 22.5 percentage points. Far from bringing Greece’s debts down to more sustainable levels, further austerity would cause them to soar.

Why would eurozone authorities be so cruel and foolish? Because they don’t really care about the welfare of ordinary Greeks. They aren’t even that bothered about whether the Greek government pays back the money they forced European taxpayers to lend to it, ostensibly out of solidarity, but actually to bail out French and German banks and investors. German Chancellor Angela Merkel and other eurozone policymakers just don’t want to admit that they made a terrible mistake in 2010 and have lied about it since. So they want to be seen as standing up for eurozone taxpayers’ interests, and they want Greeks to put up and shut up until Merkel and her minions are comfortably in retirement, and it is someone else’s problem.

Further austerity isn’t the only consequence of leaving Greeks languishing in their debtors’ prison. Contrary to claims that Greece shells out scarcely any interest, it pays an average interest rate of 2.5 percent on its debts, according to Joakim Tiberg of UBS, a Swiss bank — 4.5 percent of GDP in total. With prices falling by 2.1 percent over the past year, the inflation-adjusted interest rate is 4.7 percent. Worse, the debt overhang creates crippling uncertainty about how the crisis might be resolved — including whether Greece might be forced out of the euro — stunting consumption, investment, and growth. Having creditors breathing down your neck to raise taxes is a further deterrent to investment. And the debt overhang also causes deflation, making the burden even more unbearable.

The creditors’ insistence on reform is also disingenuous. Greece has been run by the institutions known as the Troika — the European Commission, the European Central Bank, and the IMF — since May 2010. They have had every opportunity to insist on the reforms they are now demanding. Yet they kept on funding Greece because all they cared about was the fiscal targets (and wage cuts to boost “competitiveness”). The sudden focus on reform is primarily about forcing Tsipras to break the promises that got him elected in January.

Let me be clear: Greece urgently needs reform. Its economy is underdeveloped, hidebound, and dominated by oligarchic families who monopolize markets and suborn politics. Its public administration is corrupt and inefficient. Its legal system is dysfunctional, its tax system full of holes. Tsipras may or may not be willing to reform Greece. But ultimately, it ought to be up to Greeks whether and how they do so.

Indeed, the main sticking points between Athens and its creditors aren’t really reforms, they’re fiscal measures. While improving the collection and administration of value-added tax (VAT) is desirable, the creditors are also demanding a tax hike of 1 percent of GDP. That is wrong-headed, since it would hit the country’s main export sector, tourism, which accounts for 18 percent of GDP.

Pension reform is also necessary as Greeks live longer and fewer workers have to support more retirees. But the country’s social safety net is so threadbare that a single-slashed pension is often supporting a whole family of jobless people. So, while encouraging healthy people to continue working is desirable, pension cuts are not.

Some argue that Tsipras should sign up to what the creditors want, take the cash to pay off the looming bond payments to the IMF and the ECB, make a show of reform, and then press again for debt relief. But the notion that the creditors would then be more flexible is fanciful. In 2012, eurozone governments promised Greece debt relief once it achieved a primary surplus, but they still haven’t delivered it. The Greek government has now put forward sensible plans for restructuring its debts. Unless its creditors are willing to start negotiating meaningful debt relief, Tsipras should reject any deal on offer.

Merkel ought to be as magnanimous with Greece as the United States was with post-Nazi Germany, when Washington forgave half of the West German government’s debts in 1953 [this is not what was most important about the Marshall Plan money: None of it went back to the United States. All of it stayed in Germany-- Eliyahu m'Tsiyon]. But if eurozone authorities won’t be reasonable, unilateral default — and even euro exit — is preferable to debt bondage. 
[emphases are mine, likewise I supplied the link in the sentence above "Merkel ought to be as magnanimous. . . ."- Eliyahu] 

High Eurozone Official Attacks German Policy of non-Solidarity with Euro Brethren -- Juncker Is First

Since last October, we have been criticizing the Eurozone's handling of its debt crisis, and more recently, especially the German role. The crisis started two years ago in Greece, and then spread to other eurozone countries because the Greek problem was not handled rightly. Some prominent Euros now recognize that German policy, which other Eurozone states have been acquiescing in, is the wrong way to a solution. Germany insists on austerity and rejects any debt-sharing [mutualization of debt]. Germany doesn't want to give up a single pfennig of its own money, forgetting that after all the destruction of WW2 --in Germany and the rest of Europe, in a war started by Germans-- Germany was enabled to rebuild and recover only thanks to the approx. $ 15 billion that America gave to Germany through the Marshall Plan [some of the money was given as loans but the loans were forgiven and all the money was kept in Germany]. The extreme austerity forced on Greece is ruining the Greek economy but Germany --with the acquiescence of its Eurozone partners-- insisted on more austerity, on a solution that doesn't work. The Euros are like a drunkard with a hangover who drinks more in order to relieve the discomfort of his hangover. The euro addiction to austerity is like a craving for the hair of the dog that bit ye. But most of the discomfort is being suffered in the countries with a high state debt, and is not yet felt in Germany.

Eurozone policy, dominated by Germany, that is by German finance minister, Wolfgang Schäuble, is leading the world into a worldwide recession, if not a deep depression. That may have motivated the new criticism of Germany that hasn't been publicly heard at high levels before. Now the chairman of the Eurozone, Jean-Claude Juncker of Luxembourg, states that "there is no more time to lose" [«non c'è più tempo da perdere»] to stabilize the monetary union and adds the accusation of Germany being at fault. Juncker may foresee the possible collapse of the Euro if no major steps are taken and views Germany as an obstacle to needed measures. Collapse of the euro currency and the Eurozone states would have major world wide repercussions greater than the incoming world recession. Here is Juncker:

JUNCKER ATTACKS BERLIN IN THE SZ [suddeutsche zeitung] -- A very harsh Jean-Claude Juncker accused Berlin, meanwhile, of bending EU interests to internal political motives: "Why does Germany allow itself the luxury of constantly doing internal politics on questions that have to do with Europe [= the whole EU]? Why does it treat the Eurozone like its subsidiary?, the chairman of the Eurogroup [eurozone countries] asked in an interview with Süddeutsche Zeitung. [qui]

JUNKER ATTACCA BERLINO SULLA SZ - Un durissimo Jean-Claude Juncker ha accusato intanto Berlino di piegare gli interessi dell'Ue a ragioni di politica interna: «Perchè la Germania si permette il lusso di fare continuamente politica interna su questioni che riguardano l'Europa? Perchè tratta l'eurozona come una sua filiale?», si è chiesto il presidente dell'Eurogruppo in un'intervista alla Süddeutsche Zeitung. [qui]

But maybe Juncker didn't wise up enough. In the same interview he proposes that German finance minister Wolfgang Schaeuble should be made finance minister for the whole Eurozone --or maybe the whole EU. "Schäuble has all the characteristics." [«Schäuble ha tutte le caratteristiche»]. But would other Euro states, other Eurozone members want their economies to be dominated even more closely than before by one the chief architects of the failures since the first mistaken Greek "rescue"? In any case, do they want to be more tightly controlled by German policy? On the other hand, maybe by proposing Schäuble as a super Eurozone finance minister, Juncker means just to throw a bone to the Germans in order to soften the blow of his criticism. Maybe. But it would be best to put Schäuble in retirement or let him criticize from a seat in the German parliament where he would not directly make policy.

Lastly, although there is little enough solidarity among Eurozone and EU member states, the EU continues to fund the PA/PLO as well as all sorts of lying, anti-Israel so-called "human rights" & "peace" NGOs, even as the EU's own funds run low, let's bear in mind that we must not allow the Euros to decide Israel's future. They are fools at best, if not consciously hostile.

[Altri servizi su Il Sole-24 Ore e Il Giornale]
[data on EU funding of fake "human rights" and "peace" NGOs can be found in abundance on the site of NGO Monitor --see link on our blog roll]
[If they're funded by the EU, can they really be considered "non-governmental organizations"?]