Would posters agree with the analysis of the collapse of the Greek and Italian governments presented in the following article in Time magazine? I post the first three paragraphs - the full article can be read online.
http://www.time.com/time/world/article/0,8599,2099350,00.html?iid=sl-article-mostpop1
The voice of the people isn't something the markets seem to want to hear these days. First there was Greece, the cradle of democracy itself, where early this month, the merest mention of a referendum offering its citizens a say in a series of severe austerity measures was enough to send the markets into a tailspin. The ultimate result: the collapse of Prime Minister George Papandreou's ruling coalition, the rejection of any notion of bringing the proposal before the people, and the installation of a caretaker government under the leadership of Lucas Papademos, a former vice president of the European Central Bank and, until earlier this week, a visiting professor at Harvard.
Then came Italy. As Athens threatened to go under, Rome found itself under pressure not so much for its level of debt — which though high is generally considered within the limits of sustainability — as much as for the erratic behavior of its flamboyant prime minister, Silvio Berlusconi. On Monday, investors seemed to make the collective decision that he could no longer be trusted at the helm of the euro zone's third largest economy and sent Italy's cost of borrowing up towards crisis levels. By the end of the week, not only was Berlusconi finished, so was the very idea of holding a vote to replace him. The markets had spoken, and they didn't like the idea of going to the electorate. "The country needs reforms, not elections," said Herman Van Rompuy, president of the European Council on a visit to Rome Friday.
Indeed both Papandreou and Berlusconi had been respectively berated and belittled by Angela Merkel of Germany and Nicolas Sarkozy of France. It is almost as if Franco-German displeasure combined with the disapproval of the markets was enough to bring about regime-change. As in Athens, the plan in Rome is to replace the outgoing prime minister with somebody from outside the political class. Mario Monti, a neo-liberal economist and former EU commissioner who seems designed with the idea of calming the markets in mind, is expected to take over from Berlusconi after he resigns Saturday. For many in the two battle-scarred capitals, the fact that Papademos and Monti aren't directly accountable to the public isn't a problem. It's the reason they're being called in. Both countries have been tasked by the EU to attempt to restore confidence through deep cuts, sharp tax hikes and painful restructurings of the economy. The two technocrats have been tapped to lead because no politicians wants to face the electorate after doing what the markets have decreed needs to be done. "Democracy has very serious limitations." says Roberto D'Alimonte, a professor of political science at Rome's LUISS University. "It has the ability to kill itself, to self-destruct. [Bringing in a technocratic government] is not good or bad. It's necessary."
Actually it's not so long, so I'm going to post the rest of it:
In Greece, the political class lost its credibility with the blowout over the referendum, says George Pagoulatos, a professor of European politics and economy at the Athens University of Economics and Business. Though the vast majority of the public is not eager to undergo the unpopular austerity measures, the probable consequence of not passing them — abandonment by the EU and a chaotic exit from the euro — is seen with even more distaste. Papademos, a respected economist untainted by the political slugfest, is thought to have the credibility and legitimacy to see the program through, allowing the two main political parties that have agreed to support him to renounce responsibility when the reforms start to pinch. "Theoretically, he has the capacity to apply policies that are politically costly," says Pagoulatos.
In essence, what a technocratic head of government allows a country's elected officials to do is disperse the cost of passing unpopular legislation. By carefully hewing to the middle of their country's political spectrums, and pulling together packages of cuts that spreads the pain as evenly as possible among all sectors of society, Papademos and Monti, neither of whom would likely ever stand for election, have a chance to pass reforms that would otherwise be impossible. "The key in Greece and Italy and everywhere else is fairness," says D'Alimonte. "And that can only be done by a government that is not responsive to a single electoral base."
Of course, neither economist will be able to push anything through if there isn't a consensus that something must be done. And the lack of direct voter buy-in heightens the risk of populist dissent down the road. But, until now, the motivation has been provided by the threat of a market meltdown and a subsequent economic collapse. In Italy, Mario Monti was greeted with applause in the Senate Friday, a day in which the country's stock exchange gained 3.68% as stability seemed to be at hand.
Yet, until the moment he's sworn in, Monti's ascension is far from a done deal, and it didn't take long after the markets had closed for the weekend for it to start to come under fire. Though Monti, a former advisor to Goldman Sachs, is heavily championed by the country's respected president, many in parliament have spent the week whispering that Berlusconi's ouster amounts to a "banker's coup." "Yesterday, in the chamber of deputies we were bitterly joking that we were going to get a Goldman Sachs government," says a parliamentarian from Berlusconi's government, who asked to remain anonymous citing political sensitivity. With less than 24 hours until Berlusconi's expected resignation, other names, closer to the outgoing prime minister, were beginning to be floated. If the markets object, the world will find out as soon as the opening bells ring on Monday.
Originally posted by TeinosukeI don't really see anything hugely controversial in those paragraphs, but I will remark on the author's seeming disapproval of the adoption of austerity measures against the wishes of much of the populace.
Would posters agree with the analysis of the collapse of the Greek and Italian governments presented in the following article in Time magazine? I post the first three paragraphs - the full article can be read online.
http://www.time.com/time/world/article/0,8599,2099350,00.html?iid=sl-article-mostpop1
The voice of the people isn't something the ma ...[text shortened]... ringing in a technocratic government] is not good or bad. It's necessary."
Of course the people aren't going to want to face cutbacks, but if a government is running a huge deficit with no prospect of reducing it, it has no choice but to force cutbacks. The inability or unwillingness of politicians to do this is a major concern for the sustainability of western prosperity today.
Originally posted by sh76Uh, it could raise taxes on the rich.
I don't really see anything hugely controversial in those paragraphs, but I will remark on the author's seeming disapproval of the adoption of austerity measures against the wishes of much of the populace.
Of course the people aren't going to want to face cutbacks, but if a government is running a huge deficit with no prospect of reducing it, it has no choic ...[text shortened]... politicians to do this is a major concern for the sustainability of western prosperity today.
Originally posted by sh76In your opinion, how are draconian austerity cuts compatible with the notion of western "prosperity"? Who, exactly, is prospering under this arrangement? The bankers?
I don't really see anything hugely controversial in those paragraphs, but I will remark on the author's seeming disapproval of the adoption of austerity measures against the wishes of much of the populace.
Of course the people aren't going to want to face cutbacks, but if a government is running a huge deficit with no prospect of reducing it, it has no choic ...[text shortened]... politicians to do this is a major concern for the sustainability of western prosperity today.
Originally posted by sh76Well, cutbacks are one of a few possibilities to achieve a balanced budget. You could also, as rwingett suggests, raise taxes. You could withdraw from the euro and introduce a new currency, hoping that devaluation will stimulate the economy in the long term. You could default.
Of course the people aren't going to want to face cutbacks, but if a government is running a huge deficit with no prospect of reducing it, it has no choice but to force cutbacks. The inability or unwillingness of politicians to do this is a major concern for the sustainability of western prosperity today.
All these are possibilities that have been discussed in the context of Greece and Italy. Don't the people have a democratic right to decide which option they prefer?
Originally posted by TeinosukeFor a couple of decades I've been reading the recommendations of progressives for the United States to follow the lead of Europe. The only thing I can say now is that we are probably following the European models too closely.
Actually it's not so long, so I'm going to post the rest of it:
In Greece, the political class lost its credibility with the blowout over the referendum, says George Pagoulatos, a professor of European politics and economy at the Athens University of Economics and Business. Though the vast majority of the public is not eager to undergo the unpopular ...[text shortened]... he world will find out as soon as the opening bells ring on Monday.
Originally posted by normbenignI think it is they who are following our model a bit too closely.
For a couple of decades I've been reading the recommendations of progressives for the United States to follow the lead of Europe. The only thing I can say now is that we are probably following the European models too closely.
Originally posted by normbenignYeah, GWB is such a socialist weasel.
For a couple of decades I've been reading the recommendations of progressives for the United States to follow the lead of Europe. The only thing I can say now is that we are probably following the European models too closely.
Originally posted by rwingettI guess you can still find social democrats in Northern Europe. You know, that place where the economy is doing fine and public debt is under control.
What does it even mean to be a socialist anymore? The European socialists all seem to take their marching orders from the bankers these days.
Originally posted by rwingettFirst of all, I agree with your point about raising taxes on the rich, at least under the US rates. I don't know if the European rates aren't already high enough.
In your opinion, how are draconian austerity cuts compatible with the notion of western "prosperity"? Who, exactly, is prospering under this arrangement? The bankers?
You can rip the system as much as you like, but common people are more prosperous in the last 50 years than they ever were in history.
Originally posted by TeinosukePeople have a Democratic right to vote for the people they want to handle the situation.
Well, cutbacks are one of a few possibilities to achieve a balanced budget. You could also, as rwingett suggests, raise taxes. You could withdraw from the euro and introduce a new currency, hoping that devaluation will stimulate the economy in the long term. You could default.
All these are possibilities that have been discussed in the context of Greece and Italy. Don't the people have a democratic right to decide which option they prefer?
Throwing every fiscal question out to a popular referendum so that people who don't understand the issues make every micro decision is absurd.
Originally posted by sh76Every fiscal question? How about just one fiscal question? Even that was too much for the bankers.
People have a Democratic right to vote for the people they want to handle the situation.
Throwing every fiscal question out to a popular referendum so that people who don't understand the issues make every micro decision is absurd.