It's Payback Time!

Christine Lagarde, president of the IMF, in an interview in the Guardian, bluntly told the Greek people that "it's payback time and not to expect any sympathy."The real question in this looming "game of chicken" between financial interests and societies is who is going to pay the ultimate price? There is an abundance of recently produced documentaries and stories that point in the same general direction, namely that we are heading to the precipice in a "game of chicken," as societies are asked to account for decisions that political and economic leaders made, while playing a game of monopoly.
From Nick Dunbar's Goldman, Greece and a troubling tango to the more recent documentaries
Crisis Guide: The Global Economy – Council on Foreign Relations, The Financial Crisis Like Sangia? – Frontline Documentary,it is abundantly clear that a higher stakes game is afoot. Unfortunately, it appears that there will be payback, and if history is any indication the outcome will be disastrous for all. One doesn't have to search the annals of history as Peter Frankopan, New York Times, did with the Bankers at the Gates to understand the calamity ahead.

Closer Integration or Bankers at the Gates?

As the President of the European Central Bank, Mario Draghi calls for closer integration in order to deal with the Euro Crisis, there is another sentiment that is historically based. In today's New York Times, Peter Frankopan, director of the Center for Byzantine Research at Oxford, reminds us that the situation in Greece and the European banking system has its roots in a Crusade of 800 years ago. The Bankers at the Gates sentiment resonates among the Greek people today and it's a sentiment that has been re-enforced throughout modern Greek history and the history of the eastern mediterranean among the people of the region. From the Fourth Crusade of 1204 to the building of the Suez Canal to the capitulations extracted for economic and geopolitical interests, are these failed attempts of integration and flattening the world along economic structures facilitating global markets, information and technology transfer or flattening people and cultures?

The more things change...

On Saturday as the G8 leaders met at Camp David, MD, they watched the UEFA Champions League championship game between Chelsea of London and Bayern Munich. The picture taken after the final penalty kick is very telling as a cheering British PM, a supportive American president, an envious French president, a concerned Iberian leader, and a defeated German chancellor all watch the outcome. 2012 or 1945?

Governance versus Leadership?

Leadership and global governance become increasingly important as the globalized international system continues to be at the throes of a prolonged crisis. This weekend as leaders of the G8 are meeting in Washington, and NATO leaders are meeting in Chicago the agenda is dominated by topics related to the global trouble spots including: regional and political developments and security issues; economic and global issues; energy and climate issues; food security; economic transition of Afghanistan; transition in the Middle East and North Africa.

At the top of the agenda is the Eurozone crisis and the situation in Greece, which beyond anything else and regardless of perspective is indicative of the lack of policy buy-in by citizens in advanced democracies in dealing with the current crisis. On one level the global institutional network, which includes among others, the G8 and G20, the IMF, the World Bank, the EU, NATO defines global governance from the top. As the policy output fails to address the issues and in fact the crisis spreads, the effectiveness of the institutions are questioned and leadership is sought elsewhere. The frontrunners in the upcoming Greek and Mexican elections are indicative of the popular dissatisfaction with current policies to address chronic political dysfunction. The main challenge that Mr. Tsipras in Greece and Mr. Peña Nieto in Mexico will face is the ability to immediately while convincing  a disillusioned citizenry that the road from perdition is long. 

As a recent Washington Post article indicates, "Of the 14 crisis-hit European countries that have elections since 2009, nine have new leadership. Effective governance, democracy, and ultimately ability to inspire toward long-term common goal while delivering short-term benefits,  defines leadership. 

       

Selective Memory....

"Leaders today do not believe their job is to restrain popular will. Their job is to flatter and satisfy it. A gigantic polling apparatus has developed to help leaders anticipate and respond to popular whims. Democratic politicians adopt the mind-set of marketing executives. Give the customer what he wants. The customer is always right."

Although I agree with David Brooks' point, I don't agree with his underlying premise of human nature! It is convenient to argue on the basis of a Hobbesian view of human nature, when what's at the basis of the current crisis, the worshiping of neoliberal reforms since the early 1970s. The selective memory loss of commentators such as David Brooks who in the past praised Milton Friedman's arguments of taking the state out, can not blame human nature for the fact that the economy dominates society. Michael Sandel’s new book, “What Money Can’t Buy: The Moral Limits of Markets,” is a good counterpoint as argued by Thomas Friedman's column from last Sunday, This Column Is Not Sponsored by Anyone .

In the Steps of Thucydides

In the Steps of Thucydides: Cretan Studies Association has inaugurated a program of educational partnership with Emmanuel College of Boston, hosting a group of students from Emmanuel College who have been attending the seminar 'In the Steps of Thucydides'

Is the canary about to die?

Since 2008 and as the economic crisis in Europe has led to fiscal austerity and increased taxation, the national citizenries throughout Europe have felt in varying degrees the pain of those policies, and have come to realize that the economic criteria were much stronger. The political and social dimensions of  citizenship had become secondary to economic terms of efficiency, productivity, and competitive within a global market. So as the financial pressure is getting greater national citizenries are demanding from the national politicians greater relief and support which they can't deliver as the political elite are bound by their European integrationist limitations.
I have argued that in fact the Maastricht Treaty, which defines the European integration and the creation of the Eurozone has killed Social Democracy in Europe. In this context the change in administration in France and the inability Greek politicians to form a government following the May 6th elections means very little.  The austerity prescription that the European Central Bank and the German-French axis will continue, since the forces that are driving this policy have not been persuaded. As far as Greece is concerned, the situation there is more dramatic since the anemic social and political Greek system is feeling the pressure of the Maastricht economic straitjacket. Unfortunately Greece is the "canary in the coal mine" and as such nothing will change until the canary dies.

A Land Without a Rudder - By Joanna Kakissis | Foreign Policy

A Land Without a Rudder - By Joanna Kakissis | Foreign Policy The current Greek situation is indicative of the vision gap between the elite and the people of Europe as to the overall project called European Union. For European leaders since the mid 1980s the European Union and the creation of the eurozone was an attempt at creating a competitive bloc within an emerging global market, while for the people of Europe the post-Cold War unification meant fulfillment of humanistic qualitative aspirations which included political and social rights, labor rights, gender equality, economic equity,  and ecological sustainability. These two divergent visions were compromised in the years following Maastricht through access to cheap money due to lowered interest rates,  increased consumption, and partisan politics that were able to postpone touch decisions through a predatory financial sector. The ability by national political elite to postpone fiscal responsibility by refinancing debt into the future though inventive financial instruments was exposed after 2008. In Greece and soon in Spain and Portugal we are experiencing the complete collapse of the interest articulation structures that has underwritten political and social stability for the last four decades.

The New Math of Geopolitics: Does It All Add Up to G-Zero? - Interview By David Rothkopf | Foreign Policy

The New Math of Geopolitics: Does It All Add Up to G-Zero? - Interview By David Rothkopf | Foreign Policy