BY ERIC WALBERG
Riots swept across Eastern Europe this winter. In Latvia over 100 people were arrested when they attacked the Finance Ministry with cobblestones from the restored tourist area, protesting unemployment, budget and wage cuts. Meanwhile in Lithuania, riot police fired rubber bullets and tear gas on the trade union protest march. In Sofia, in the Bulgarian capital the protests turned violent and led to the arrest of over 150 protestors. These three states are all members of the Exchange Rate Mechanism (ERM2), the European Union’s pre-detention cell. They must join.
The International Monetary Fund (IMF) calls for the devaluation of the currencies of their “economies”, which are not really economies at all after their de-industrialization over the past two decades, but the EURO-agreements prevent this. And even if they could do the IMF number, their huge mortgage debts contracted in Euros and Swiss francs over the past decade, would still be un-repayable.
Latvia’s government was trying to comply with the IMF-imposed measures to qualify for an emergency loan, much like Argentina did in 2001, when brutal cuts to education and social programmes sparked a general strike and radicalized the entire nation (except, of course those responsible for the crisis). The riots in Latvia brought the government down and its credit rating was lowered to junk status.
It’s no better inside the Euroland like Ireland and Iceland.
We haven’t even mentioned Greece, which is already considered a failed state, virtually in a state of civil war since last September. The very pillars of the European Union are crumbling. In January hundreds of thousands marched in French cities in the biggest protest in two decades. An ongoing month-long strike in far-flung Guadeloupe is now in the midst of a full-scale urban warfare, with many deaths including a trade union leader. The ruling white elite and tourists are at this very moment fleeing in panic. Martinique and Reunion have also joined in.
In Great Britain demonstrations are breaking out across the country protesting unemployment and the Bank bailouts. The British National Party shocked the establishment by winning a Council seat in Kent. Spain lost a million jobs in 2008 and the unemployment rate is expected to reach 25 per cent in this year. With Spain’s high debt levels this will get worse Wage deflation that is proposed is a recipe for revolution.
Marches and protests are expected to get bigger and more violent throughout Europe. Suddenly the specter of the end of the European Union (EU) and the end of this common currency, is being raised. This was the gimmick that was put into use in order to convince the ”free world” of the danger of Communism – now the domino effect is back with a vengeance.
The string pullers over the past two decades managed t transform t face if Europe, destroying the Soviet Union and expanding the EU and NATO rapidly eastward. But just as Napoleon and Hitler did before them, these over-confident conquerors moved too far and too fast, and now face the real prospect of losing everything. The marvel of this Euro zone is now derided as the VOLKER-KERKER (Prison of Nations), recalling the Austro-Hungarian Empire. Italian journalists have begun to talk of Europe’s “TEQUILA CRISIS”, referring to the collapse of Mexico’s peso in 1933, when the elite took their money to the US. A similar capital flight from Club Med could set off an unstoppable process and will bring the Euro down.
What is the EURO, except a fixed exchange rate agreement among its members? Europe is far from uniform. It mans that the national governments are restricted in their monetary and fiscal policies to deal with any crisis. It also means that any ripples in Europe become tidal waves, as the countries’ economic successes or failures happen together.
As the EURO begins to slide down against the worthless American Dollar (that’s right), no one is preparing for its immanent collapse and what to do about it.
It is vital for the West to keep this edifice afloat, after all. Virtually all of Eastern Europe is in hock to the Western Banks, and as they go bankrupt, their exchange rate plummets with respect to the Euro, and they represent bargain-basement fire sales for the West. The Polish Zloty plummeted over 50 per cent in the past six months, making it impossible to repay the countless Euro-Swiss loans that were contracted by the unwitting Poles, lures purposely by the low interest rates.
Western Banks have lent Eastern Europe about $1.7 Trillions, since “independence” and this must be saved from disappearing at all costs. The currently proposed $31 Billion to be pumped into the Banks is peanuts.
Lured into the Euro-clutches, these Eastern European orphans can now be squeezed. Integration with a vengeance on a par with WWII and post-WWII occupations. At least under post war Socialism (which most Eastern Europeans remember fondly) – the people were provided for. But if the unsupervised elites keep sending their ill-gotten money abroad, the pit becomes bottomless. Riots turn into revolutions! France will no doubt lead the way. President Sarkozy is very unpopular today at only 36 per cent.
The same can be said for the United States and President Obama, whose policies are directed by the Banking Elite and their cry of: “Bail us out, but leave us alone!” These Bankers are calling for an international banking institution, which of course they will control, and which, we are supposed to believe, will avert any further economic and financial crisis.
Eastern Europe risks now being eaten alive by the Western Banks. Western Europe risks economic stagnation and endless political unrest. This looks like the dead-end, and the only way forward is to break the hold that the present economic system has on both the East and the West.
Using this crisis to push through unpopular measures doesn’t work anymore, as the Greek and the Latvian people stated as well as their politicians also discovered. The streets are already ringing with the cry of:”We won’t pay for your crisis anymore!”
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