Greece

[pongo]

Coming soon to a Eurozone near you.......Romania, Lithuania, Latvia, Turkey.....

 

Stable, growing economies each and every one.

 

They are unlikely to join the € though they may choose to adopt it (which is a different issue) - therefore so what really ? With or without the EU, national and regional govts are anyhow increasingly irrelevant in the face of borderless corporatism which sets its own agenda.

[Cambon]

They are unlikely to join the € though they may choose to adopt it (which is a different issue) - therefore so what really ? With or without the EU, national and regional govts are anyhow increasingly irrelevant in the face of borderless corporatism which sets its own agenda.

 

Exactly - systematic asset stripping of smaller, less powerful nations, until there is one, indomitable power - Germany!

[When Skies Are Grey]

Exactly - systematic asset stripping of smaller, less powerful nations, until there is one, indomitable power - Germany!

 

So they will get where they wanted to get...just 70 years late.

[La_Dolce_Vita]

Spook - The issue of whose debt it is dependent on the political structure of country and where the money has been spent.

 

For third world countries with very little or no democratic element, they don't owe a penny of the debt their countries end up with.

 

But the degree to which that is true of liberal democratic countries is obviously much less, because they have more democratic elements into the political make-up of the country and there is a certainty a good proportion of the funds have been spent on the public.

 

For public expenditure, it is the people's debt. But for any debts that do not directly pay for public services, there is no question that it is not their debt.

 

Moreover, although they have a representative government, they only ratify an existing system. The public do not make those debts.

It's a matter of political opinion, not fact, whether the public should shoulder any IMF lending giving the lack of democracy in their political system.

 

I do think the best option is for them to default on all their loans. The impact will be less harsh on the people in doing so.

[SJR]

Spook - The issue of whose debt it is dependent on the political structure of country and where the money has been spent.

 

For third world countries with very little or no democratic element, they don't owe a penny of the debt their countries end up with.

 

But the degree to which that is true of liberal democratic countries is obviously much less, because they have more democratic elements into the political make-up of the country and there is a certainty a good proportion of the funds have been spent on the public.

 

For public expenditure, it is the people's debt. But for any debts that do not directly pay for public services, there is no question that it is not their debt.

 

Moreover, although they have a representative government, they only ratify an existing system. The public do not make those debts.

It's a matter of political opinion, not fact, whether the public should shoulder any IMF lending giving the lack of democracy in their political system.

 

I do think the best option is for them to default on all their loans. The impact will be less harsh on the people in doing so.

You really are stark raving mad !!

[La_Dolce_Vita]

Well debt is a subject that fundamentally rests on WHO takes out the debt, WHO makes use of the funds, and WHAT it is spent on. When you talk about national debt the matter rests on the strength of the democracy and the proportion of funds spend on things that benefit the public. The fewer the democratic elements in a political structure and less money spent on public services, such as hospitals, social care (and the more spent on business support, military contracts, and what could be termed 'corrupt' spending, etc.) then less responsibility the citizen has for any debt that government incurs.

[Evil Goblin]

I understand the point LDV is making and he has a good point. It is not unusual for the banks to lend money to a country (where it is a charge on that country, which is legally responsible to repay) and for corrupt governments to syphon off at least part of the funds to themselves and their pals i.e. the country and its' people do not get the benefit of part (or even all) of the loan but nevertheless are responsible for repayment. There was a celebrated case in the 60s where Citibank lend something like $60m or $80m to the Congo, where it was a charge on the country, its' people and resources - the actual cash went straight from Citibank to Mobutu's Swiss Bank account and none of the money ever reached the country itself.

Many loans to Latin America in the 70s never conferred any benefits on the countries concerned because the $ loan proceeds were simply used for the wealthy to shift their money out of their own countries to banks in the USA.

[Newty]

[spook]

Spook - The issue of whose debt it is dependent on the political structure of country and where the money has been spent.

 

If money has been loaned to a country and the rulers have diverted that cash to themselves there is a weak argument that it iis not a national debt on that country. It is not an argument that I would support because the lenders made funds available in good faith to the country, not its rulers. If crime has taken place in that country then that is the responsibility OF that country, not the misjudgement on the lenders part and so the debt should remain on that country.

 

Look on it this way. You loaned a thousand pounds to a family down the street that you thought were in a good position to repay you but Grandma ran off with the cash. What do you do? Tell them “Oh never mind, you weren't to know” or go after them to repay the loan because the family owe you your thousand pounds back?

 

For third world countries with very little or no democratic element, they don't owe a penny of the debt their countries end up with.

 

YES THEY DO. Good grief we give enough such places hand outs (that we have had to borrow in the first place, sheer insanity but that's another matter)

 

But the degree to which that is true of liberal democratic countries is obviously much less, because they have more democratic elements into the political make-up of the country and there is a certainty a good proportion of the funds have been spent on the public.

 

For public expenditure, it is the people's debt. But for any debts that do not directly pay for public services, there is no question that it is not their debt.

 

Right. Let's deal with that. How about mortgage advancements to people or loans made by banks and other institutions to people? Those monies form part of the gross national debt of a country and it is the servicing of debt in both the public AND private sector that must be considered. On that bassi, and it is absolutly rock solid a basis, it DOES come down to public debt. The public got the cash either way, the public must now pay their debts.

 

Moreover, although they have a representative government, they only ratify an existing system. The public do not make those debts.

 

Nonsense.

 

In any case the public benefit (?) from those debts ergo the public are responsible to repay them and must take their lumps in order to do so.

 

It's a matter of political opinion, not fact, whether the public should shoulder any IMF lending giving the lack of democracy in their political system.

 

No, it's a matter of FACT that the public must repay the debts. Governments have no money of their own. They only have tax receipts and loans. These monies are spent by government on behalf of (and all too often as handouts to) the public. The public get the cash or the effects of that cash and it's payback time. The public must pay the price in every sense.

 

I do think the best option is for them to default on all their loans. The impact will be less harsh on the people in doing so.

 

Less harsh? You must be joking! Imagine going in to see your bank manager for a loan having just been declared bankrupt! Or trying to open a credit acount in order to buy food from across that we can't grow, or grow enough of here? Less harsh? What planet are you on!

 

I happen to believe that Greece should be kicked out of the Eurozone along with Spain, Portugal, Ireland, and possibly Italy and the people then face the cold harsh reality of fending for themselves. They've been parasitic on Europe for far too long and now are objecting to repaying what was loaned to them. They should, no MUST be made to pay.

 

After all, that money they have had and now demand is money that must come from someone else working properly and not sitting in the sun or retiring well before they should. Or from someone else taking on debt because they have a better reputation than the lazy Greeks. Why SHOULD those who work hard and save hard and live within their means be expected to subsidise them?

[La_Dolce_Vita]

If money has been loaned to a country and the rulers have diverted that cash to themselves there is a weak argument that it iis not a national debt on that country. It is not an argument that I would support because the lenders made funds available in good faith to the country, not its rulers. If crime has taken place in that country then that is the responsibility OF that country, not the misjudgement on the lenders part and so the debt should remain on that country.

It's not a weak argument at all. And nor am I talking about crime.

Say you have a country with an autocratic or tyrannical regime (as our extreme example), it is that government that requests the debt for WHATEVER reason. And the credit (other governments or IMF) provide that loan.

 

It matters not what the lendor has intended the money to be for. The issue entirely rests who accepted the loan and where the money went.

 

If the Burmese or Central African Republic governments were given £6,000,000,000 for whatever reason (say drought causing problems, on the verge of bankrupty and needs propping up, or to be put to use for humanitarians uses). At that point, before any money is spent, the debt is NOT the public's debt.

You are talking about a regime where there is no democratic government. There is only a government that enforces its rule. Were ALL money to get spent on the military and for the benefit of a few rich folk, then not a penny should be paid back the workers and peasants of those countries for example.

 

You back up your argument by some idea that you have only implicitly made reference to that the government IS the people or that any government equates to the voice of the public. But this is obviously not the case. Not even in liberal democracies. Certainly not for dictator regimes.

 

Look on it this way. You loaned a thousand pounds to a family down the street that you thought were in a good position to repay you but Grandma ran off with the cash. What do you do? Tell them “Oh never mind, you weren't to know” or go after them to repay the loan because the family owe you your thousand pounds back?

But the different with what we are talking about is that the arrangement was made by Grandma. It is simply the case that the lendors thought it would go to the rest of the family.

 

For third world countries with very little or no democratic element, they don't owe a penny of the debt their countries end up with.

 

YES THEY DO. Good grief we give enough such places hand outs (that we have had to borrow in the first place, sheer insanity but that's another matter)

Doesn't matter how much is given. You can make a case for responsibility for the debt WERE it to have been spent on the public, but this is rarely the case for poorer countries.

 

But where this is little or no democratic element, you have a government that has no justification to enforce its rule offering very little to the people of this money and creating a worsening situation for them by tieing them into debts they made no agreement for and which they haven't received a penny.

 

Any Third World Debt incurred by these poor countries and received by the governments ought to be written off. And much has.

 

I'll answer the rest of your post later.

[gazza]

to be honest greece is just a grain of sand next to the usa,

 

with $500 billion to be repayed by the end of aug, a vote on the rasing the debt celing takes place on the 2nd aug,

if its not raised then all hell will decend on the usa that will make greece look like a walk in the park,

 

and with the Republican said they won’t raise the debt limit unless the Obama administration first agrees to big spending cuts or to steps to lower the debt over the long run

it is not 100% that they can raise the debt lvl to avoid bankruptcy.

this would crumble the world to be honest

 

intrsting times we are entering

[pongo]

gazza - appx 2/3 of US debt is held by the US public and US institutions. Nearly 20% is held by the Social Security Trust Fund. Looked at from that perspective US debt may not be quite the big issue that some say it is.

 

See here for chart and analysis.

[gazza]

that may be true pngo,

but the fact it is the USA govenment that has to pay back 500 billion at the end of aug or it will defualt is the main point.

[spook]

I'll answer the rest of your post later.

 

Don't bother.

 

LDV, you obviously live in a different reality to the rest of us.

[spook]

that may be true pngo,

but the fact it is the USA govenment that has to pay back 500 billion at the end of aug or it will defualt is the main point.

 

By going down the QE path, aka printing money, the USA already IS in default.