On Europe

In a detailed exploration of Ukrainian history and philosophy, The New York Review of Books asks questions about the future of Europe that go beyond simply dealing with the current crisis in Greece: 

No one can know where this vision of Europe might lead; that is, in some sense, the point. But we do know that for Europe to exist as such it must also exist in broader institutions. Many Ukrainians understand this, which is why they made their revolution about Europe itself. These institutions must be improved, which is why we are all talking about Greece. Europe can fail in both Greece and Ukraine, which is why the Russian media in these weeks abounds in prematurely celebratory visions of a collapsed European Union. The underlying message of Russian propaganda is that working for Europe, whether inside the European Union or beyond it, makes no sense, since democracy and freedom are nothing more than the hypocrisy of a doomed order, and history has no lessons other than those of power. Russian nihilism cheers on European narcissism.

The European Union will no doubt survive both crises, at least for a time, but in neither has it provided much of a response to its existential and democratic problems. Ukraine deserves help but is largely ignored because it is not a member of the European Union; the Greek prompt for institutional reform is going unheeded. As European leaders struggle to define what Europe is, it is more useful, or at least more heartening, to read the grim universalists in Kharkiv than to watch the gleeful provincials in Moscow. 

The New York Review of Books: Edge of Europe, End of Europe, July 21, 2015

After leaving the Greek cabinet, former finance minister Yannis Varoufakis gives an insight into how the negotiations within the Eurogroup worked: 

It’s not that it didn’t go down well – it’s that there was point blank refusal to engage in economic arguments. Point blank. … You put forward an argument that you’ve really worked on – to make sure it’s logically coherent – and you’re just faced with blank stares. It is as if you haven’t spoken. What you say is independent of what they say. You might as well have sung the Swedish national anthem – you’d have got the same reply. And that’s startling, for somebody who’s used to academic debate. … The other side always engages. Well there was no engagement at all. It was not even annoyance, it was as if one had not spoken. 

New Statesman: Yanis Varoufakis full transcript: our battle to save Greece, July 13, 2015

And Tropics of Meta with a historic perspective on German economic thought and why Keynesianism never took hold there: 

In Germany, though, Keynesianism never really took hold. During the years of the so-called Wirtschaftswunder, or “economic miracle” of the postwar years, West Germany only occasionally employed Keynesian policies. Indeed, the only real period of Keynesian influence in the economy was during the Grand Coalition government (1966-1969) and during the early years of Willy Brandt’s government (1969-1974). According to the political scientist Christopher S. Allen, “Keynesianism in Germany was effectively preempted by another set of policies, oriented toward the supply side and the social market economy, that was progressively reinforced—both institutionally and ideologically—over succeeding stages in the postwar period.” 

Tropics of Meta: Why German Economic Thought Made the Greek Crisis Inevitable, July 10, 2015

And the New York Times on Alexis Tsipras' struggle between being the head of a party with a leftist platform and pursuing pragmatic policies that were voted down by the electorate and members of his own cabinet (which he has now ousted), with new elections looming. 

This essay in openDemocracy criticises the current left trend to consider the European Union as an inherently neoliberal project rather than calling for institutional overhaul and reform. 

It might be tempting to put austerity down to the EU being a supranational structure and assume an alternative economic model is only possible once states break free of this international association. What this ignores, however, is how the current structure of the EU and its brutal imposition of austerity on the less competitive states of its periphery, reflects its failure to go beyond nation-states, not its success in doing so. 

openDemocracy: If we abandon the ideal of European unity, the only winner will be neoliberalism, July 22, 2015

Meanwhile, Paul Krugman: "The only big mistake of the euroskeptics was underestimating just how much damage the single currency would do."

More perspectives on Greece

“The advantages far outweigh the disadvantages,” Chancellor Angela Merkel of Germany told a news conference, explaining her decision to accept the deal and recommend that the German Parliament also grant its approval.

“The country which we help has shown a willingness and readiness to carry out reforms,” said Ms. Merkel, who was referring to Greece.

Ms. Merkel said a fund would be created to use the proceeds from privatizing parts of the Greek economy to help pay down its debt. That fund would be “to the tune of” 50 billion euros, or about $55 billion, she said without elaborating. 

The New York Times: European Leaders Reach Deal to Resolve Greek Debt Crisis, July 13, 2015 

The widening gulf between eurozone hawks and doves paves the way for an acrimonious summit on Sunday, with France and Italy lining up against Germany and the northern and eastern Europeans. Matteo Renzi, the Italian prime minister, is expected to tell chancellor Angela Merkel that enough is enough and that Greece should not have to put up with any more humiliation.

Merkel is under intense pressure from the Americans not to “lose” Greece and is worried about her own legacy. But Greece fatigue is becoming endemic in Germany, and she faces growing unrest in her party ranks where Schäuble’s hard line is popular. She was said to have endorsed Schäuble’s tough position. 

The Guardian: Greece nears euro exit as bailout talks break up without agreement, July 12, 2015

The Left Platform of Syriza with an alternative plan that includes leaving the eurozone, huck on how degrowth might ensure the future of Europe, bookforum with an extensive list of links about What Makes A Good European?, Germany floating the idea that Greece might take a time-out from the Euro for five years revealed a rift between France and Germany, Paul Krugman calls the Eurogroup's list of demands "madness", and the negotiations are breaking up Syriza (and what does it say about the European Union if the outcome of all of this is a regime change, considering that Syriza had a mandate for its policies?).  

Perspectives on Greece

This brings us to the crux of the matter: Tsipras and the former finance minister Yanis Varoufakis, who resigned on 6 July, talk as if they are part of an open political process where decisions are ultimately “ideological” (based on normative preferences), while the EU technocrats talk as if it is all a matter of detailed regulatory measures. When the Greeks reject this approach and raise more fundamental political issues, they are accused of lying, of avoiding concrete solutions, and so on. It is clear that the truth here is on the Greek side: the denial of “the ideological side” advocated by Dijsselbloem is ideology at its purest. It masks (falsely presents) as purely expert regulatory measures that are effectively grounded in politico-ideological decisions. 

New Statesman: Slavoj Žižek on Greece: This is a chance for Europe to awaken, July 6, 2015 

Europe is a big place, and there are a lot of interesting policy issues that European policymakers could be talking about. There is Russian aggression against its neighbors, for example. There's demographic stagnation in Germany. There's youth unemployment in France. There's what to do about Swiss tax havens. There's trying to form a trans-Atlantic free trade zone with the United States.

But it's hard to focus on anything other than Greece as long as Greece's old debts are perpetually throwing the continent's financial arrangements into turmoil. 

Vox: 5 reasons the eurozone could be stronger without Greece, July 8, 2015

The Guardian: Greece's proposals to help end talks deadlock, July 10, 2015

The New York Times: Paul Krugman: Debt Deflation in Greece, July 7, 2015

The Guardian: Yanis Varoufakis: why bold, brash Greek finance minister had to go, July 6, 2015

Links 1/7/15

Politics: 

On Greece: 

And, sure enough, what we are seeing now, 16 years after the eurozone institutionalised those relationships, is the antithesis of democracy: many European leaders want to see the end of prime minister Alexis Tsipras’ leftist government. After all, it is extremely inconvenient to have in Greece a government that is so opposed to the types of policies that have done so much to increase inequality in so many advanced countries, and that is so committed to curbing the unbridled power of wealth. They seem to believe that they can eventually bring down the Greek government by bullying it into accepting an agreement that contravenes its mandate. 

The Guardian: Joseph Stiglitz: how I would vote in the Greek referendum, 30 June 2015

No side bears sole blame for the current mess. From the very start, the idea of a common European currency was built on a logical flaw. Put at its crudest, monetary union all but requires fiscal union, which in turn requires political union. Yet when the euro was launched, there were no such institutions or mechanisms, just the perennial but vague hope of ever closer union. What’s more, the world’s largest currency area was run on two unsustainable economic motors: Germany exporting ever more to southern Europe and the rest of the world, and southern Europe relying on cheap credit. That fragile system was crushed under the rubble of the financial crisis. 

The Guardian: The Guardian view on the Greek crisis: the European project itself is at stake, July 1, 2015

Brookings on what we do know and what we don't know about the potential outcome of the crisis, Quartz on what's next after the end of the ECB assistance, openDemocracy argues that Greek defaulting might not be so bad after all and compares to the Argentinian experience. 

openDemocracy on how utterly the international community failed Syrian civilians.

The US after Charleston: 

It may seem odd, decades after the civil-rights movement, to note that for a sitting President to say that the Confederacy fought for the institution of slavery—and that doing so was a moral wrong—is a radical statement. Yet it is, and shortly after making it the President fell silent. It appeared that perhaps he had lost his way, but then, in a remarkable moment, he began to sing “Amazing Grace,” a hymn that is at once a lament, a prayer, and a hope—written by John Newton, a onetime slave trader who became an abolitionist. Immediately after the speech, people began debating whether the song had been part of the prepared text or whether the President sang it out of an impromptu spiritual imperative. In either case, he was likely hoping to see in the national culture precisely the transformation that Newton had experienced in himself, one that facilitated his first truthful accounting of the evil of slavery. 

The New Yorker: Last Battles, July 6, 2015

Salon on why Republicans fail to acknowledge that right-wing terrorism is a more serious threat than Islamic terrorism, and Bree Newsome's statement after removing the Confederate battle flag from the South Carolina state house. 

Chris Christie has joined the growing field of Republican contenders for the Presidential candidacy but might be more successful in ruining Jeb Bush's day than winning it for himself. 

The US Deputy National Security Advisor on which region drives the Obama administration's foreign policy. 

Pop Culture: 

Ellen Page on her life after coming out, a portrait of Cosima Herter, the science consultant of the outstanding Orphan Black, Claire Denis will direct a science fiction film written by Zadie Smith. 

On Greece

She [Christine Legarde] was offering not a solution but a narrative: the Greeks were in this situation because they were bad people. They wanted a beneficent state, but they didn’t want to pool their resources to create one. The IMF was merely the instrument of a discipline they dearly needed. This line has broadly held – the debtors are presented as morally weaker than the creditors. To give them any concessions would be to reward their laziness and selfishness. The fact that debt is a two-way street – that the returns on debt exist because of the risk that the money might be lost, and creditors have their own moral duty to accept losses when they arise – is erased by this telling of the events. 

The Guardian: The moral crusade against Greece must be opposed, June 29, 2015

A “Yes” vote means that Greece will continue the grinding era of austerity that has caused so much pain to its citizens over the last five years, in exchange for keeping the euro currency and the monetary stability it provides.
A “No” vote almost certainly means that the country will walk away from the euro and create its own currency (which will surely devalue sharply), bringing financial chaos in the near term but creating the possibility of a rebound in the medium term as the country becomes more competitive with its devalued currency. 

The New York Times: The Next Few Days Have the Potential to Transform Greece and Europe, June 28, 2015

Foreign Policy mentions the role that Russia may play in the future which might cover Greece's IMF debt in exchange for the country's support against Ukraine, and openDemocracy offers a geopolitical perspective on the crisis.

Quartz: Everything you need to know about this unfolding Greek tragedy, July 29, 2015

"The deepest recession in living memory"

"It's a very tough economic situation. It's taking longer than anyone hoped to recover from the biggest debt crisis of our lifetime. The one thing that would make the situation even worse would be to abandon our credible plan and deliberately add more borrowing and even more debt," said the chancellor.

David Cameron admitted at Prime Minister's Questions that the return to recession was "very, very disappointing". "There is no complacency at all in this government in dealing with what is a very tough situation, which frankly has just got tougher," he said. "It is very difficult recovering from the deepest recession in living memory, accompanied as it was by a debt crisis." 

The Guardian: UK sinks into double-dip recession, April 25, 2012

"A collective trance"

By many indicators, Greece is devolving into something unprecedented in modern Western experience. A quarter of all Greek companies have gone out of business since 2009, and half of all small businesses in the country say they are unable to meet payroll. The suicide rate increased by 40 percent in the first half of 2011. A barter economy has sprung up, as people try to work around a broken financial system. Nearly half the population under 25 is unemployed. Last September, organizers of a government-sponsored seminar on emigrating to Australia, an event that drew 42 people a year earlier, were overwhelmed when 12,000 people signed up. Greek bankers told me that people had taken about one-third of their money out of their accounts; many, it seems, were keeping what savings they had under their beds or buried in their backyards. One banker, part of whose job these days is persuading people to keep their money in the bank, said to me, “Who would trust a Greek bank?” 

NY Times: The Way Greeks Live Now, February 13, 2012

Linkliste unbehandelter Themen

Dark Dark Dark - Wild Goose Chase (Elephant Micah Cover)

Relevant because of reasons (and yes, I do realize that I've posted this pretty much exactly a year ago - it made things even weirder BECAUSE IT'S NOT EVEN THE ORIGINAL VERSION OF THAT SONG).

Politics: 

Both the Atlantic and Die Zeit have essays on Guantanamo which, after ten years, still exists. 

It is the legacy of a country, known for its civil liberties, which allowed government power to exceed reason or justice or morality. So long as the place remains open, so long as men are detained there, the wound we opened but refuse to close cannot meaningfully heal.

Jon Huntsman withdrew from the Republican race this Monday, leaving Perry, Gingrich, Santorum and Paul to pretend like it isn't decided yet.

Today I dreamt about having an argument over why Austria lost its S&P AAA rating and Germany didn't (the banks' exposure to volatile Eastern European, especially Hungarian and Rumanian, market? The inability of the governing coalition to find a majority to enshrine the debt ceiling in the constitution?). It was weird. Also someone made me listen to Elisabeth - The Musical, and there's this line in a song that describes (or over-dramatises, we'll see) the lack of action following: "Wir sitzen im Kaffeehaus rum und erwarten gähnend die Apokalypse." But hey, look, at least Germany has low borrowing costs now that it's a safe haven!

In the same vein: 

“Mathematics is mathematics, and one plus one has to equal two and not five,” he said, describing how, even with a significant restructuring of its debt, the Greek government’s deficit would still be too large and its economy not competitive enough to put the country back on a sound footing.
That sense can be self-reinforcing as well, making it even harder for Mr. Papademos to push through the changes Greece needs to survive the current crisis.
Greece’s dire economic condition can hardly be overstated. After two years of tax increases and wage cuts, Greek civil servants have seen their income shrink by 40 percent since 2010, and private-sector workers have suffered as well. More than $75 billion has left the country as people move their savings abroad. Some 68,000 businesses closed in 2010, and another 53,000 — out of 300,000 still active — are said to be close to bankruptcy, according to a report issued in the fall by the Greek Co-Federation of Chambers of Commerce.

NY Times: As Reforms Flag in Greece, Europe Aims to Limit Damage, January 15, 2012

Foreign Policy has an photo essay comparing the most iconic pictures of the Haiti earthquake with how these sites look now, two years later. 

A couple of days before Wikipedia and other sites went black to remind users of the looming threat that is SOPA (and its Senate counterpart, PIPA), the Obama administration announced that any attempt to battle the threat of online piracy "must guard against the risk of online censorship of lawful activity and must not inhibit innovation by our dynamic businesses large and small." This is not actually a promise to veto the act should it eventually pass.

Pop Culture: 

io9 has an interview with Caroline Skinner, who joined the production team of Doctor Who and oversaw the making of The Fades (which is still waiting to be renewed for a second season and has just started its run on BBC America - you know what to do!). 

If you want to potentially spoil yourself for the first episode of Skins and possibly subsequent ones, Digital Spy has interviews with Dakota Blue Richards and Jessica Sula. 

Here's a trailer for Mad Men's fifth season, which is scheduled to premiere on March 25! In the meantime, may I point out that Justified has just started its third season.

New Santigold! (Big Mouth). Still a big fan of Go, the co-op with Karen O. 

Last bit of good news for a while, probably...

With his formal resignation, which was confirmed by the presidential palace on Saturday night, the 75-year-old billionaire brought down the curtain on a government that has played a significant role in taking the European single currency and the global economy to the brink of catastrophe. The dramatic end of Berlusconi's 17-year domination of Italian politics came as the lower house of parliament approved a package of savage cuts and stimulus measures demanded by the European Union to trim Italy's massive €1.9 trillion debt. 

The Guardian: Silvio Berlusconi bows out after Italian MPs vote for savage cuts, November 12, 2011 

«Tritt ab, geh nach Hause», lauteten Sprechchöre gegen Berlusconi, als dieser das Abgeordnetenhaus durch den Hintereingang verließ. Rufe wie «Hau ab, Mafioso» hatten den umstrittenen Ministerpräsidenten bei seiner Abfahrt aus seiner Villa Grazioli auf dem Weg zum Quirinalspalast begleitet. Ein Sturm der Entrüstung «Hanswurst, Hanswurst» empfing ihn, als er - schwer eskortiert - dort eintraf. 

Die Zeit: Die Ära Berlusconi ist beendet, 12. November 2011

cont.

Heretofore, the countries that joined the euro zone did so with the understanding that they could have the best of all worlds — the convenience of a common currency without the economic and political integration that would inevitably be needed if the countries did not pursue similar economic policies. That understanding was wrong.

For Greece, no alternatives look good. The latest European bailout package does make some gestures toward promoting economic growth, like a program of loans for smaller businesses, and it allows Greece to escape paying some of its debts. But mostly it calls for sacrifice and austerity for years and years. The alternative, with a loss of European support, could be worse. Greece would have to get by on its own resources. It could default on its debt and devalue its suddenly resurrected currency, the drachma. Eventually, that might lead to economic growth, but in the meantime there would still be austerity. Without access to outside capital, Greeks might have to pay for their own government, through taxes. 

The New York Times: Why Not Give Greeks Their Say?, November 3, 2011

The Economist: Greece’s woes, November 5, 2011

Die Zeit: Um Mitternacht entscheidet sich Papandreous Zukunft, 4. November 2011

The Guardian: Greece may leave euro, leaders admit, November 3, 2011

NY Times: Greek Leader Calls Off Referendum on Bailout Plan, November 3, 2011

NPR: What Would A Greek Default Mean To Europe?, September 21, 2011

Behind the strip malls the tree tops are burning.

The big fear is that a decisive turn against the bailout package in Greece could undermine European efforts to enforce deep budget cuts in other heavily indebted European countries, especially Italy, which is mired in its own political crisis and has a far larger economy and much more debt than Greece.

Political analysts and several advisers to Mr. Papandreou said the prime minister had decided to announce a popular referendum on Monday night as his last best hope to shore up his eroded political standing. They said he wanted to put Greece’s fate back in the hands of the Greek people and to force his many opponents — both inside his government and in the opposition — to coalesce around the idea that what is at stake is Greece’s membership in the euro zone. 

NY Times: Greek Cabinet Backs Call for Referendum on Debt Crisis, November 2, 2011

The Atlantic: Will the Greece Referendum Send the Eurozone Spiralling?, November 1, 2011

The Guardian: Greek government teeters on brink of collapse in wake of referendum plan, November 2, 2011

Die Zeit: In Brüssel wächst die Wut auf Athen, 2. November 2011

The Economist: A Greek Drama, November 1, 2011

Linkliste unbehandelter Themen

Politics: 

Germany's Bundestag voted for the enlargement of the European Financial Stability Facility yesterday, the Austrian Nationalrat is currently debating the issue (a positive outcome is very likely, both ruling parties will vote for it, so will the Greens). The enlargement needs to be approved by all 17 euro zone countries.

NY Times: In European Crisis, Experts See Little Hope for a Quick Fix, September 29, 2011

NY Times: Germany Approves Bailout Expansion, Leaving Slovakia as Main Hurdle, September 29, 2011

Pakistan... if the upcoming Presidential elections eventually include foreign policy questions, the question of Pakistan will probably come up. 

NY Times: Pakistanis Tied to 2007 Border Attack on Americans, September 26, 2011

The Washington Post: U.S. sharpens warning to Pakistan, September 21, 2011

The National on the role of the United States in the changed political landscape after the continuing Middle Eastern uprisings. 

Palestine's bid for statehood was moved to a council that could take weeks to decide. 

Pop Culture: 

A previously unreleased track by James Blake and a quote about the current state of dubstep (aiming for the "frat-boy market").

Nevermind was re-issued (and re-mastered) on its 20th anniversary. 

R.E.M. disbanded. 

An interview with Alex Kingston before the season finale of Doctor Who - as much as I didn't enjoy the way Amy's arc was written this season, I am still looking forward to finding out about River and the Doctor. 

A list of pilots I've watched so far this season: 2 Broke Girls, Suburgatory, Ringer, Prime Suspect, Homeland, The Secret Circle, Pan Am, The Playboy Club. A list of shows I'll continue watching: Homeland. 

Also, The Fades is getting really good (I like all the characters, but Mac is such a scene-stealer). After only two episodes, all the characters are complicated and conflicted! "There is nothing more pathetic than needing someone!" (from the writer who wrote "I think you need someone to want you" about a character also played by Lily Loveless!)! It's genuinely scary and beautifully filmed. 

To counter vague theories with anecdotal evidence

As a sort of answer to the theory that the European Social Democrats are losing elections because all those smart educated people have realized that the true reason for the crisis was government regulation of the financial industry (wow, you say, why DID I NOT THINK OF THAT?), I very much recommend the most recent This American Life Podcast that describes how all those wacky mortgages (like "no income, no assets" - NINA) could happen, and what kind of geniuses were earning thousands of dollars and blowing them on champaign.

Everything is FINE now? Do you hear me? It's OK NOW. You can start to look somewhere else.

"The most hopeful jobs report since last summer suggested Friday that the recession was ending, but the recovery will be marked by a still-rising unemployment rate and tens of thousands of job losses each month until next year.
The American economy shed 247,000 jobs last month, the smallest monthly toll since last August, the government reported on Friday. While businesses are expected to keep cutting positions through the rest of the year, the Labor Department’s latest figures offered hopeful signs for the American worker and a measure of relief to the Obama administration, which has faced rising criticism as unemployment blew past its earlier projections."

NY Times: Job Losses Slow in July, Signaling Shift in the Economy, August 7, 2009

Along the same lines:

Salon: Things are worsening more slowly, August 7, 2009
Economist: Glimmers of Hope, August 7, 2009
Financial Times: US unemployment rate drops to 9.4%, August 7, 2009

But how do things look in Europe, you ask? Possibly comparable to the headlines above, at least in Western Europe.

It seems to be too late for that, now

After Bernie Madoff's trial and life sentence, it seems that the discussion on personal responsibility for the crisis has vanished, and the only thing still talked about are occasional shocking figures of (un)employment and one company after another reporting to let go employees. But hey, we're still doing OK, so why worry, right?

"As Pecora relentlessly grilled the most famous names in finance, the nation relived the 1920s boom in a collective act of national remembrance. The hearings started in a modest committee room, but as the public was swept up in the drama, they shifted to a stately caucus room, illuminated by chandeliers and flashbulbs. As it gained momentum, the inquiry expanded until it shined a searchlight into every murky corner of Wall Street. Pecora exposed a stock market manipulated by speculators to the detriment of small investors who could suddenly attach names and faces to their losses.
Bankers had been demigods in the 1920s, their doings followed avidly, their market commentary quoted with reverence. They had inhabited a clubby world of chauffeured limousines and wood-paneled rooms, insulated from ordinary Americans. Now Pecora defrocked these high priests, making them seem small and shabby. "

NY Times: Where Is Our Ferdinand Pecora?, January 5, 2009

...and a smaller, less shiny but possibly more sensible Phoenix rises from the ashes.

"On Monday June 1st, putting an end to weeks of expectation, General Motors filed for Chapter 11 bankruptcy protection. The idea is that the 100-year-old carmaker will be stripped of debts, other obligations and unsaveable parts and will then emerge from the bankruptcy court ready to perform like a sleek racer. The risk, however, is that it instead emerges as an old crock with a dodgy respray.
Bankrutpcy [sic] will certainly ensure the emergence of a smaller firm. The car company is being remade to cope with operating in a North American market with sales of 10m vehicles a year, roughly the number that will find buyers in 2009. GM might expect to get a little over a fifth of that market. To get into shape, more than 12 of its American plants will close and four brands—Pontiac, Saturn, Hummer and Saab—will be sold out of bankruptcy or will disappear for good. Hummer, apparently, already has a buyer. A significant proportion of GM’s dealers will go too. The end result will be over 21,000 GM workers out of a job."

Economist: Bankruptcy, at last, June 1, 2009

The Planet Money Podcast mentioned the argument that there are simply too many cars (about 1/4th too many) produced. The natural course of the market would be: when less people buy cars, less are produced to keep up the prices, also it doesn't really make sense. The downside: thousands of jobs at stake, and in the case of the car industry, at least in Germany and the US, jobs in specific regions of the country that are otherwise lacking business to employ the people there. GM disappearing would have meant an economic depression, not just a recession, for the "Rust Belt". On the other hand, intervention doesn't solve the underlying problem. Finding short-time solutions doesn't answer the real question: how can all these people be provided with jobs that will last longer than this short-term rescue operation?

NY Times: G.M.’s Chief Promises Full Details of Restructuring, June 3, 2009
NY Times: In Overhaul, G.M. May Look to Its Far-Flung Arms, June 3, 2009
Slate: Which Side Are You On, June, 2, 2009
Slate: A New Chapter, June 1, 2009
Wall Street Journal: New Era in Autos as GM Set for Bankruptcy, June 1, 2009
NY Times: G.M. to Seek Bankruptcy and a New Start, May 31, 2009

Für Pröll ist die Sache damit erledigt.

"Der Internationale Währungsfonds hatte sich, wie „Die Presse“ berichtete, bei der Berechnung des Kreditrisikos osteuropäischer Staaten – sehr zum Missfallen Österreichs – „verrechnet“ und musste aus diesem Grund seinen im April veröffentlichten „Global Financial Stability Report“ korrigieren. IWF-Chef Dominique Strauss-Kahn hat sich dafür in der Vorwoche bei einem Wien-Besuch entschuldigt, für Finanzminister und Vizekanzler Josef Pröll (ÖVP) ist die Sache damit „erledigt“.
Zumindest Letzteres könnte eine etwas voreilige Aussage gewesen sein. Denn Strauss-Kahn fügte seiner Entschuldigung hinzu, dass der „menschliche Fehler“ die Analyse der Situation in Osteuropa und im Rest der Welt nicht verändert habe. Das Risiko bleibt hoch."

Die Presse - IWF-Berechnung: Schulden erdrücken Osteuropa, 18. Mai 2009

Aaaaah, stop with all the information-sharing, it will turn into an evil self-fulfilling prophecy monster!!!!!

Also, we should consider bunnies as a solution

"For the better part of half a century after World War II, democratic capitalism built its modern framework against the backdrop of its death match with totalitarian Communism. In the two decades since the fall of the Berlin Wall, the American model of capitalism, largely unchallenged by ideological alternatives and increasingly dominant around the world, drifted toward what conservatives viewed as a more pure form of economic liberty and what liberals came to view as misguided free-market fundamentalism.
But now, as the United States and other nations look for lessons in the wreckage from the excesses of that period, political leaders are confronting uncertainty about what economic structures and values should define capitalism’s next chapter. Even before the current crisis, there were calls to rethink basic assumptions about the economy. Growth during the Bush presidency was slower than in any decade since before World War II, and incomes for most families have been growing slowly for much of the last three decades."

NY Times: Redefining Capitalism After the Fall , April 18, 2009

"After the Fall" seems to me another example of hyperbole for the sake of attention (it is, accidentally, also the name of the comic-season 6 of "Angel", just to tie this in with the general focus of this month) - but I guess part of the problem here is the lack of an alternative that has worked. We can look in the past and dream of the classic Central European welfare state, but then, it seems that this possibility is long gone. While critics of Obama use the S-word very frequently and creatively, that just looks nice on paper, much like the whole hip "we know how to use the internet now" (though a couple of months too late, suckers) teabagging thing (which they still use unironically, despite the first definition that comes up when you wiki it). Usually, the lines "This article is about the sexual practice. For the protests in the United States, see 2009 Tea Party protests" don't fare well for the conservative movement.
My prediction: everybody is going to have a little less, also security, and some will have a little more, but probably live with the possibility of having their residences and cars demolished more frequently, but nothing basic is going to change (at least for those under 30 who weren't really counting on retiring or receiving the same kind of health care as their parents).

It has stopped now.

Over the weekend I've had a discussion with my dad about the controversial Krugman-comment that sparked a series of newspaper articles on the subject with a number of Austrian economists and politicians critisizing him. Now, the reason why I felt a bit squeamish about the whole affair at first was because he admitted that he had not looked at the numbers specifically, and then there was the thing where he talked about Eastern Europe as a block rather than a number of individual countries with their specific problems.
What was not mentioned, or at least not prominently, was the fact that this actually started a couple of months ago with an IMF-report warning about the risks resulting from the engagement in countries that seem to be struggling. Whatever Dominique Strauss-Kahn meant when he spoke about a "silver lining on the horizon", he also said that he believed Austria was not in greater danger than other countries engaged in the CEE-region (yet failing to mention that Austria's exposure is considerably higher than that of any other country).
"Bankrupcy" was certainly a very nice and attention-grabbing term to throw around in this particular situation, but what surprised me about the reaction was how far it deviated from a simple "it is not that bad". Actually, it sounded more like an "Everything is just fine. And even if it wasn't, we would not say so because that would be bad for the country." Here is part of finance minister Pröll's reaction:

"Was hinter solchem "Bashing" stehe, könne er nur indirekt ableiten: Der Finanzminister erinnerte daran, mit welchem Argwohn und Neid in den vergangenen zehn Jahren die Osteuropaexpansion der Österreicher beobachtet worden sei, gerade von Ländern, die selber diese Entwicklung verschlafen hätten. Das könnte da mitschwingen."

Die Presse: Pröll: "Wirtschaftskrieg am Rücken Österreichs", 15. April 2009

Assuming that Krugman's comment was sparked by his jealousy at Austria's economic success over the past ten years seems quite ridiculous to me. In the discussion, my dad likened this to the situation of a patient in a hospital: a doctor who only gives the most realistically negative prognosis isn't really helping the relatives. In economics, talking about a down-turn is like a self-fulfilling prophecy as investors run like little children from the evil monster. But over the past months, while all those horrible numbers rolled in, I felt as if the public in Austria was still cushioned from reality, lulled in calming comments and the cheerful optimism only a bank executive can have days before accepting billions of bail-out money, while doing so basically saying "we didn't really need it, but since it was up for grabs, we took it anyway". I am not saying that we should all lie awake and fearfully wait for the next catastrophe to happen (I can do that on my own, without being part of a crowd), but it might just be a good idea to demand to be told about what might happen if things get worse. Krugman called that fuzzy feeling of nothing bad is ever going to happen to us "undeserved contentment". Damaging this would not necessarily be a sacrifice to the goddess of pessimism, but a bit of down-to-earth realism.

Something about reading those two names in one headline seems just wrong

Not that I'm an expert on Austria's exposure to the East European market, but somehow, after years of hearing that this country profited most from the expansion and reading spectacular headlines of Austrian banks making high profits in these new market, the notion that there would be no consequences at all from the catastrophic situation unravelling there (mostly Hungary, where the financial crisis has already turned into a political one) seems ridiculous to me. And calling Paul Krugman unqualified to make statements about the economy - I don't know, coming from the man whose previous engagement was in the Orwellian named "Lebensministerium", I'm just thinking about that glasshouse-stone thing.

"Ein Halbsatz eines Wirtschaftsnobelpreisträgers über Österreich sorgte für Zurückschießen auf breitester Front: "Island und Irland geht es ziemlich schlecht, Österreich könnte sich dieser Liga als drittes Land anschließen", sagte der Princeton-Ökonom, New York Times-Kolumnist und Buchautor Paul Krugman in einem Gespräch mit Journalisten Anfang dieser Woche. "Absolut absurd" nannte diese Aussage Österreichs Finanzminister und Vizekanzler Josef Pröll daraufhin am Mittwoch im Klub der Wirtschaftspublizisten in Wien. [...] Wirtschaftskammer, Industriellenvereinigung und Gewerkschaftsbund reagierten verschnupft. WKO-Präsident Christoph Leitl ließ etwa wissen: "Ich habe die Ferndiagnosen über Österreich langsam satt." Pröll nannte Krugmans Aussagen weiters "unqualifiziert"."

DerStandard: Pröll an Krugman: "Absolut absurd", 15. April 2009

I'll take any diagnosis coming from the distance over whatever a CEO of a bank has to say about it. A good example for that rule:
Die Presse: Erste-Chef Treichl: "Keine Krise und keine Panik dauert ewig", 18. Februar 2009

And Paul Krugman's blog is here, just in case that you don't agree with the Austrian finance minister's opinion that his Nobel-prize-valued analysis is uninformed.