Greek precedents Post author By Kevin O’Rourke Post date February 7, 2012 Rui Esteves discusses nineteenth century Greek debt crises here. Categories In Economic history 22 Comments on Greek precedents ← More on the Fiscal Compact → Septic tanks 22 replies on “Greek precedents” That was very interesting. Excellent piece. Greece was strategically important then as a bulwark against Turkey. It’s not as important now. That’s the reckoning anyway. Turkey ‘accidentally’ turned off the gas supply to Greece this morning. @Kevin O’Rourke Very interesting. History can be very instructive to those with a mind to learn its lessons. Of course if the New Europe were really about a celebration of heritage, culture and difference, then the Greek debt would have been written off long ago. And the New Europe would have assisted the New Greece to get up and running again. But the new Merkozy driven Europe will have its pound of flesh. It looks like the New Europe is ready to lose Greece in order that the bankers continue to feast royally. It is a narrow, stupid position worthy only of present day European ‘leaders’. Europe sacrificed for the sake of a few hundred billions. The people making that decision should be forced to watch videos of the aftermath of World War 11 as a lifetime penance. study history, in deed http://www.businessspectator.com.au/bs.nsf/Article/Greece-default-eurozone-monetary-union-soverieng-d-pd20111017-MQ2GW?opendocument&src=rss Greece was already kicked out of the latin monetary union 1908 for endless stealing, same thing as ever. More details to be seen in the refuted PhD thesis of koch-mehrin http://www.europeanvoice.com/article/2011/may/koch-mehrin-resigns-over-plagiarism/71068.aspx has there been any kind of positive news from Athens in the last 2300 years ? Greeks insist today that their social minimum must be 29% higher than the German ? after defaulting harder than Argentine ? Greece should be ejected from the European Union, now ! Maybe we need another Sulla, the only man to conquer and purge both Athens and Rome : – ) Genaeur. “Greece was already kicked out of the latin monetary union 1908 for endless stealing, same thing as ever” Is it wise for a German to visit the sins of a past generation on the current one? tullmcadoo, I see you as a typical example of racist anti german discrimination, that some folks can bring up all kinds of strange stories what allegedly could be learned from history, but as a German I am not allowed to state simple facts, without discriminating comments like yours. There were many years when this recipe worked to blackmail another few billions out of Germany, but this is coming to an end. Joseph Ryan’s crime proposal to steal from the debtors of Greece and especially the european tax payers, who came to the rescue of Greece just 2 years ago, “writing off” in order to “celebrate heritage” displays the same character trait. Europe is built on the rule of law and property rights. From the mouth of the Polish Foreign Minister, Sikorski (http://www.economist.com/blogs/easternapproaches/2011/11/polands-appeal-germany citing Kant’s categorical imperative “the entire practice of lending money presupposed at least the honest intention to repay. If this condition were universally ignored, the very idea of lending and sharing wealth would be undermined. For Kant, honesty and responsibility were categorical imperatives: the foundation of any moral order.” @Genauer There is no more Europe in the eyes of the common man – its a elites plaything. European taxpayers as you put it did not spend more of their money in Greece………. the money was recycled back into the banks without it getting spent into the Greek economy via stuff such as structural funds & the like. I have no problem with yee guys dispensing the rule of law withen your own borders but projecting a monopoly of violence outside that legal barrier is a bridge too far. My advice is to give up on projecting moral orders via discredited eurotrash Imperial mechanisms – its a dangerous game. @ Genauer As you admitted before on a different thread you’re out of your depth. You don’t even know the difference between a creditor and a debtor. It’s not because you’re German. It’s because you seem stupid. @genauer The Allies cancelled over 60% of Germany’s debts after WWII, but I suppose you don’t regard that as Germany “stealing” from the Allies. And the Allies allowed Germany’s debts to be paid back in D-marks, not dollars or sterling. And they set low interest rates. And they set a ceiling on the amount to be used for annual debt servicing so that it would not exceed 5% of export revenues. And they spread repayments over 30 years and allowed principal repayments to be deferred for years. And this was after Germany went on a borrowing binge in the 1920s at all levels – federal, state and municipal, and then treated this foreign debt irresponsibly for many years, and defaulted many times. You seem pretty clueless about the debt history of your own country, while sitting up there on your high horse. So it’s not because you’re German. It’s because you seem stupid, and hypocritical. @ Dork of Cork When I cite the Polish foreign minister about “moral values”, and that some folks fail to even pretend to ever pay their debt back, you answers that with absolutely wild slander of Germany aspiring “Monopoly” “violence”. @Eureka Spreading communist lies like your claim that the like expectancy of poor Germans would be shrinking, is done easily and fast. I spent the time to find out about your obscure (an in Germany completely unknown) claim and where that came from. And I did a thorough fisking of all the other claims as well: http://www.irisheconomy.ie/index.php/2011/12/17/draft-treaty/#comments Well, that kind of diligence cant be done in 5 seconds, but for you that is “out of your depth”. I spent some time to show you that most things you assume and say about Germany are not true, and this and insulting me is your way to repay me on this effort. You should be ashamed of yourself. @ Bryan Maybe you read John Maynard Keynes 1919 The economic consequences of peace, to understand that the Versailles treaty terms were meant to be impossible to meet, and were that in deed. And that another war was the logic consequence of that. Understanding that, the US gave Germany credits as late as 1932, even after the Hoover Moratorium. With the Exception of Finland no European country repaid the US after 1933 (e.g. http://www.futurecasts.com/Depression_bottom-1932-1933.html) in full Maybe you lookup at wikipedia “Young Plan”, “Hoover Moratorium”, “Lausanne Conference”, “London Agreement on German External Debt”. There was this one conference where everybody agreed on realistic payments, and those were paid in full and on time (last tranche just a year ago, 3rd Oct 2010), and not every 4 months asked for the next 30 % to be cut off. To accuse a war torn Germany in the 1920ties of a “spending binge” while delivering 5 % of GDP per year (originally designed as 12 % plus), that takes quite some insolence. Greece got a plan over 7 or 10 years, to reduce their overconsumption of 15% GDP p.a. during peace times to neutral. This is a little different. And what is the duration of the proposed bonds ? Since the Deutschmark appreciated after 1953 (http://en.wikipedia.org/wiki/Bretton_Woods_system), paying in Deutschmark made it actually more expensive. But you insult me as “clueless about my history” and “stupid”. Just look at yourself @ Geneur “To accuse a war torn Germany in the 1920ties of a “spending binge” while delivering 5 % of GDP per year (originally designed as 12 % plus), that takes quite some insolence.” Eh, ever thought that one led to the other? ie like in Ireland? You should also probably recall that in WW2 Germany took a rather substantial amount of wealth out of Greece, including where they forced the Greek central bank to give a loan to Germany which has never had a penny repaid. Food for thought. Hi Bond. Eoin Bond. 1. Germany was handing over an export surplus at that time. I am not sure what you mean otherwise in comparison to Ireland today. 2. I would also like you to be a little bit more specific on a) your wild claims about things back in history (names, dates, numbers, references, ….., you know, …… the usual), and b) why that matters today ? Do you wanna sue the US on My Lai, the English on the concentration camps in South Africa 1905, the corn laws in 1844 ? How far goes that back? e.g. Eureka provided a specific link, which I refuted carefully and totally, in polite terms, http://www.irisheconomy.ie/index.php/2011/12/17/draft-treaty/#comments and I was able to maintain the public belief “Eureka [ …] I do not blame them, [….] Their problem is, they drink from a poisoned well, the Spiegel/ international. ” back on 12/21/2011 Well, that was then, ……, but I still hope that I could say something similar about you in a few days. Soooo, according to public sources like wikepedia http://en.wikipedia.org/wiki/Agreement_on_German_External_Debts and references therein, Germany got in London 1953, nearly 60 years ago, a treaty, http://184.108.40.206/au/other/dfat/treaties/1954/17.html, including all western WWII enemies (even neutral Ireland, Northern Ireland (what did we do to them again ?)) AND Greece. Especially considering Article 5 (Claims excluded from the Agreement) I wonder on what basis nowadays Greece would base any demands towards Germany. If the extortion never ever stops, why did we pay in the first place, or why should Germany not in 40 years reopen the agreements of today with Greece, and demand old payments ? Soo either you back up your claims, back off, or how should I call you then ? @Genaeur All States are defined by a monopoly of violence withen their own borders(its called the law) , I was not referring directly to Germany. You are clearly a bit slow. I personally don’t think the pseudo legal structure built around the aspiring European Super Whatever has much poltical legitimacy. Greece can always vacate the premises. @ Dork, are you Irish ? Does any Anglo use that terrible translation “monopoly of violence”of the German “Gewalt Monopol”. I find that hard to believe. And that is definitely not identical with the rule of law. Well, http://www.youtube.com/watch?v=KpsBM1rmx-M&noredirect=1 the POTUS says it, in carefully chosen words and thoughts. Until yesterday I have opposed the ideas of a two-speed Europe, with a faster core. But I begin to see the merit in your proposal for Greece to “vacate the premises”, with which I assume you to mean exiting the European Union, and not the territory they live on, which would be the American interpretation. On that I would in deed recommend to go a bit slow, although it would help with their national debt. Voluntary Exits would set us apart positively from the US, fighting civil wars to keep States in. My German friend, There is not a lot of moral equivalence between Mai Lai , the Boer War and the behaviour of the German male population from 1939-45. After the holocaust you got debt forgiveness and Marshall Aid. A little generosity of spirit towards fellow Europeans would be nice. @ genauer The amount that Germany actually paid in reparations was about $5bn USD, about half of what Keynes himself thought Germany could reasonably pay, and a fraction of the headline figure. Germany itself imposed huge reparations on France in 1871, of 25% GDP, which France quickly and fully paid. Germany ran up huge debts before 1918, and then ran up even more debt in the years immediately after 1918, mostly unrelated to reparations, and then made a conscious decision to try and inflate away those debts. A Von Mises paper estimates that the amount of foreign-owned German debt wiped out by hyperinflation in this way was $3.5bn USD. Blaming Germany’s fiscal irresponsibility on Versailles doesn’t match the facts. For many years Germany did its best to avoid paying in full all classes of debt, using inflation, defaults, secret buy-backs etc. as mechanisms. But that economic and political history interferes with your self-righteous and chauvinistic pontificating about German morality on debt repayment. And I’m not surprised that debt write-offs for Germany were just “realistic agreements”, whereas write-offs for Greece amount to “stealing”. And you attack others as “racist” and “communist”, for pointing out that people in glass houses shouldn’t throw stones. Rather than “clueless about your history” I should just have stopped at “clueless”. @ genaeur It wasn’t so long ago the German military blew about twenty innocent civilians to kingdom come in Afghanistan, but as long as the money comes into German banks which made poor investments ye’ll be all right Johann Lessons from history: -Nations defaulted in the past and the world did not end. -Unpayable debts won’t be repaid. -Defaulters get debt relief but go through a period of austerity. Are people here arguing that German taxpayers should pay the debts and government spending of Greece? If so, why? Private investors decided to invest their money by lending it to Greece. It does seem like their decision was not a good one. Covering their losses by socialising the losses would be an even worse decision. I’m not sure why Germans and Greeks are expected to be at odds. I can understand if both nations were angry with the financial industry. Then again, I don’t understand why an organisation that both nations are part of (the EU) is acting against the interests of citizens of both countries: Austerity without debt relief for the citizens of Greece & If there is such a thing as odious debt then that is what the citizens of Germany would be stuck with. Crikey, I came back into this thread to see if there were any witty comments on quite an interesting article and I seem to have stumbled into the German-bashing corner. @ Genauer 6 million jews burnt in ovens. 6 million. And that’s not including the Poles and the Gypsies. 6 million. 6 million human beings murdered in the most awful way imaginable. Your attitude, your way of describing others suggests to me that you would have quite happily worn the uniform, and fired the bullets into the backs of the lesser mortals’ heads. This is not pc but it has to be said. Your country lacks the moral authority to do anything @ Genauer may i remind you what was included in your original post on this thread?? You brought up past indiscretions and baseless insults about the Greeks, so Germany’s history would appear to be fair game. And for the record, Ireland has had a trade surplus for the last 25 years or so. Germany got a massive amount of debt forgiveness in the past, as well as massive aid (rightfully so), despite stealing from Greece and inflicting war on most of Europe, so why is the suggestion that Greece gets a debt haircut, some aid, and remain in the EU so strange to you?? “Greece was already kicked out of the latin monetary union 1908 for endless stealing, same thing as ever.” “has there been any kind of positive news from Athens in the last 2300 years ?” “Greece should be ejected from the European Union, now!” “Maybe we need another Sulla, the only man to conquer and purge both Athens and Rome : – )´” There were many years when this recipe worked to blackmail another few billions out of Germany, but this is coming to an end. You are completely in the wrong here. No-one is asking Germany to fork over anything. Europe is asking Germany to get off of OUR printing press. The only way out of unsustainable debt is a) Debt write offs or b) inflation. Option c) Austerity is a proven failure everywhere it has been applied. Option a) (which is actually the best one) has been ruled out by everyone due to fears of losing their pensions, but option b) has already been applied in the US, the UK, Japan, and in many other economies. It has not been applied in Europe because one nation has vetoed the process. That nation is Germany. Germany has vetoed quantitative easing in the eurozone for one reason and one reason only: because this crisis has been an bonanza for that country. Jobs, wealth, and political power have flowed into Germany from across the continent. So what we have in Europe, is one nation’s interests being put over the other 26, the exact opposite of what the EU is supposed to be about. That is why we are seeing such caustic comments such as the above in this thread. Because the principles of european solidarity have been abandoned in favour of narrow national interests. The euro is not a German currency. It is a European currency. No one nation has the right to decide how the other 16 should be run. If that offend the principles any nation, then it should leave the euro and return to its own national currency. That is the right and indeed the duty of all sovereign states who value their own freedoms and principles over the economic demands or dictates of others. Comments are closed.