Skip to main content

ECB's economic hitmen

globinfo freexchange

What was the trend in the last decade of the 20th century that ensured the dominance of neoliberal doctrines of capitalism across the planet? If your first response is the collapse of the former USSR and the Eastern bloc, think again. Behind the celebrations and observations about the alleged domination of liberal bourgeois democracy, one of the biggest attacks was held on peoples' rights to control even falsified, through representatives, the economy of their country.

Sawing off the branch on which it sat, the political establishment across the world began to offer different levels of independence to central banks. The political establishment obeyed to the dominant view among market participants, according to which, politicians through the provision of benefits to the people, cause extreme cyclical fluctuations in the economy, which only an independent central banker could balance. In fact, politicians, apart from the twig on which they sat were also sawing the tree of democracy. "The independence of central banks", Naomi Klein explained to me a few years ago, "is the mechanism by which markets explain to the politicians that they cannot play with their toys. It is the most important evidence that the markets are in an open war with democracy."

The European Central Bank not only could not be an exception in this situation but soon became the most ruthless "economic killer" who acted on behalf of commercial banks of countries such as Germany. Using the central bankers of member countries as a "fifth column", ECB managed to impose its positions in parliaments of weak countries when needed to overrule the governments that did not cooperate.

The fact that the European Union lacks political control mechanisms on such institutions, leaves ECB completely uncontrolled. In the US, where the FED enjoys the same "independence", would be considered unthinkable for the central banker to come into conflict with the interests of the federal government, for example by refusing to buy Treasuries to help the national economy to emerge from a crisis. Unlike in Europe, the ECB has refused several times to listen to the wishes of even the Eurogroup, declaring allegiance only in Berlin, or, in specific financial institutions.

As Barroso's former advisor Philippe Legrain revealed to the Greek Truth Commission for Public Debt, the refusal of ECB's previous president, Jean-Claude Trichet, to consider any potential restructuring of Greek debt in 2010, was aimed solely at rescuing certain French and German banks which were particularly exposed to Greek debt.

As the debt crisis deepened, leading the economies of the European region in hostage under the respective central banker of the eurozone, the ECB clearly took the role of an "economic hitman". While Washington had access, during previous decades, at CIA to ensure its dominance in South America, Berlin began in 2008 to entrust 'destabilization' operations to the ECB. The dress rehearsal held in Ireland in 2010, when Trichet openly threatened the government that it would cut funding of the banking system, forcing Ireland to exit eurozone in case it would not accept the "offer" loans from the EU, IMF and the cruel austerity measures imposed. The total amount that the Irish tax payers called to pay for this agreement was EUR 64 billion, or about 14,000 euros per Irish citizen.

This silent "coup" was successfully repeated in Cyprus when Berlin decided to get over with regional economic havens and gather control of black money into more controlled regions in Europe. And of course the same threats from the ECB were repeated several times in Greece, every time that the terms of the new loan agreements had to be set.

The ECB mechanism, in close cooperation with the central bankers of the eurozone members, was now completely out of control, interfering in the internal politics of sovereign states. The next step, namely the overthrow of an elected prime minister, it was just a matter of time to occur and was first tested in Italy.

In the summer of 2011, through a simple letter-ultimatum to Silvio Berlusconi, Trichet and Draghi called for implementation of harsh austerity measures in order for the ECB to buy bonds of the Italian state and save the country from imminent bankruptcy. Serving specific sections of the bourgeoisie in Italy, which were suffocating under the monetary policy of Berlin, Berlusconi spoke openly about the possibility of exit of Italy from the eurozone and several bankers within and outside Italy were requesting his "head on a plate".

As the Financial Times revealed last year, the summer of 2011, Italian President Giorgio Napolitano called the technocrat, former employee of Goldman Sachs, Mario Monti, in his office under absolute secrecy and asked him whether he would be ready to replace the elected prime minister. According to the Financial Times, the message given to Monti, was that he would be called to govern, as soon as the spread of the Italian bonds, which at that time ranged at 200 units, exceeded 300. The soaring spread and the precipitation of Italian bonds was done through a series of skilful movements by the ECB president Mario Draghi (coincidentally or not, another former executive of Goldman Sachs).

The ECB was sending a clear message that those governments who do not follow the orders were risking to be thrown in the dustbin of history, just in a few weeks.

The work of ECB could not, of course, mark such a success without the active support of the central bankers of the EU member states, which in most cases act as agents of the decisions taken in the central headquarters in Frankfurt. This, of course, does not have to do with some personal treason, but with a reflection of the prevailing balance between the economic elites of the eurozone countries with the powerful economic centers of Europe. The more dependent and parasitic is the bourgeoisie in a eurozone country, the more the man who puts as central banker will express his allegiance to the ECB. His "independence" actually ensures that he is unaccountable to any democratically elected institution, and thus attached to the strongest (and most lucrative) piece of the economic elite each time.

There were of course a few times when the government of a country which for various reasons decided to deviate from the mandate of the ECB, preoccupied with the local central banker. The right-wing government of Hungary gave a battle for months to force the central bank governor András Simor to leave his position, through which functioned essentially as a representative of the country's creditors. The EU and the ECB used their entire arsenal to prevent the removal of Seymour, going so far as to threaten Hungary even to suspend country's right for voting in all institutions. At that time they remembered government interference in the freedom of press, a case which until then, no one in the corridors of Brussels bothered to investigate.

Ιn order to force the central banker to resign, the Hungarian Government cut his salary by 75% and put its own people in many posts of the central bank. In vain. The central banker left only when his term ended and only after the "independence" of the central bank gave him the opportunity to fight the interests of his own country in one of the most critical posts of the Hungarian economy.

The government of Cyprus was also in open war with the central banker. With the outbreak of the crisis in 2012, the coldness of relations between President Christofias and the central banker A. Orphanides evolved into an open war as the former realized suddenly that he does not control the country's banking system during one of the most crucial moments of the modern Cypriot history. Once again, Frankfurt of course stood openly on the side of its own man, who exerted pressure to impose new austerity measures. Christofias was forced even to refer him to the general prosecutor (accused for the manipulation of official data) to achieve his removal, when it was already too late.

The question naturally arise: After all this, why did the SYRIZA government in Greece, permitted Yannis Stournaras to continue be in charge of the Greek economy?

Translated from the original source:


Related:


The new big trick of neoliberal bankdebtocracy

Comments

Popular posts from this blog

US-backed counter-revolution coup against Cuba blatantly fails

globinfo freexchange   Since at least early 2018, the US imperialists were setting the stage for another coup against Cuba in the form of a "color revolution".  As reported back then:   The US State Department announced a new program called 'The Cuba Internet Task Force'. The Task Force will consist of the US government and non-governmental representatives to "promote the free and unregulated flow of information in Cuba". It is part of the National Security Presidential Memorandum of "strengthening the policy of the United States toward Cuba", that was issued by President Trump in June 2017.   This policy seeks "advancing Cuban human rights; encouraging the growth of a Cuban private sector independent of government control; enforcing final orders of removal against Cuban nationals in the United States". The US has sought to overthrow the Cuban government ever since the 1959 revolution. This is not the first time the US has attempted to

Chris Hedges on Assange, Donziger, & the US prison state

Redacted Tonight   Chris Hedges joins Lee Camp for a conversation around his latest book about teaching in American prisons. They also discuss corruption in the media and the U.S. System of Justice. The persecution of Julian Assange and Steven Donziger have garnered attention over the last few weeks for their egregious displays of judicial corruption in service of the world’s most powerful people. Hedges provides context for your outrage in their cases. He then reveals his experiences teaching prisoners in maximum security facilities and expresses support for incarcerated people who have chosen to protest their living conditions.

Alert: US imperialists prepare counter-revolution coup on November 15th to take over Cuba!

globinfo freexchange   On November 1st, Lee Camp appeared astonished by the fact that the State Department essentially announced a US-backed coup against Cuba in advance!  And not only that. The US imperialists revealed the specific method and the exact date of the counter-revolution coup! The method is the typical one that we've seen in various cases the last decade or so, which involves a type of "color revolution". The date: November 15th. On November 2nd, cadenagramonte.cu website gave the details and the key players of the operation.   On November 3rd, TeleSUR reported that:                                A Cuban government representative said that Cuba has probably been facing up the largest and most complex cultural warfare operation orchestrated by the Central Intelligence Agency (CIA), promoting a new type of counterrevolution. On Twitter, Cuba's Deputy Foreign Minister Anayansi Rodríguez posted a U.S. plan to bring Cuba's political system down, whic

Οι ολιγάρχες ετοιμάζουν το Plan B που είχαν στο συρτάρι: Συγκυβέρνηση ΝΔ-ΚΙΝΑΛ και επιστροφή της γαλαζοπράσινης λαίλαπας

globinfo freexchange   Το άκρως φιλοκυβερνητικό Βήμα , κομμάτι της συστημικής προπαγάνδας της εγχώριας ολιγαρχίας, έδωσε χθες το σύνθημα για το Plan B των ολιγαρχών που είχαν στο συρτάρι ως εναλλακτική, καθώς δεν χρειάστηκε να το θέσουν σε εφαρμογή, λόγω της αυτοδυναμίας που πέτυχε η Μητσοτακική δεξιά στις εκλογές του Ιουλίου του 2019.    Πρόκειται το σενάριο συγκυβέρνησης ΝΔ-ΚΙΝΑΛ.  Όπως είχαμε γράψει τον Ιούνιο του 19, η ΝΔ (με ή χωρίς δεκανίκια), έχει ως μοναδική αποστολή να συνεχίσει το "λαμπρό" της έργο από εκεί που το άφησε. Βέβαια, η "Αριστερή παρένθεση", που η Τρόικα εσωτερικού και εξωτερικού φρόντισε έτσι και αλλιώς να κουρελιάσει, κράτησε λίγο παραπάνω απ'ότι υπολόγισαν τα "μεγάλα αφεντικά". Τώρα, ήρθε η ώρα να ξεκουμπιστεί, διότι υπάρχει κίνδυνος να θυμηθεί τις Αριστερές της καταβολές και να καταστρέψει το "θεάρεστο" σχέδιο του νεοφιλελεύθερου ιερατείου. Απ'ότι φαίνεται, υπάρχουν πρόθυμα δεκανίκια, για παν ενδεχόμενο. Από τότ

Visionary realism: A green future beyond capitalism - Yanis Varoufakis, Ann Pettifor & Noam Chomsky

DiEM25   "There is no alternative", "it's the end of history" in the shadow of the 2008 crash, the environmental crisis and ongoing COVID19 pandemic, never has the hubris of these words been more striking. Nevertheless if we are in fact at the end of an era, what comes next? Join us in uncovering the exciting possibilities that the future can hold with public intellectual Noam Chomsky and economists Ann Pettifor and Yanis Varoufakis. 

The most important battle for Press Freedom in our time

If he is extradited and found guilty of publishing classified material it will set a legal precedent that will effectively end national security reporting.   by Chris Hedges  Part 1 For the past two days, I have been watching the extradition hearing for Julian Assange via video link from London. The United States is appealing a lower court ruling that denied the US request to extradite Assange not, unfortunately, because in the eyes of the court he is innocent of a crime, but because, as Judge Vanessa Baraitser in January concluded, Assange’s precarious psychological state would deteriorate given the “ harsh conditions ” of the inhumane US prison system, “ causing him to commit suicide .” The United States has charged Assange with 17 counts under the Espionage Act and one count of trying to hack into a government computer, charges that could see him imprisoned for 175 years. Assange, with long white hair, appeared on screen the first day from the video conference room in HM Prison Belm

Top 1% of US earners now hold more wealth than all of the middle class

by Alexandre Tanzi and Mike Dorning  After years of declines, America’s middle class now holds a smaller share of U.S. wealth than the top 1%. The middle 60% of U.S. households by income -- a measure economists often use as a definition of the middle class -- saw their combined assets drop to 26.6% of national wealth as of June, the lowest in Federal Reserve data going back three decades. For the first time, the super rich had a bigger share, at 27%. The data offer a window into the slow-motion erosion in the financial security of mid-tier earners that has fueled voters’ discontent in recent years. That continued through the Covid-19 pandemic, despite trillions of dollars in government relief .   Rise of the Super Rich   Middle-class Americans now hold less wealth than the top 1% by income.   While “middle class” has different meanings to different people, many economists use income to define the group. The 77.5 million families in the middle 60% make about $27,000 to $141,000 annually

Top media company demands reporters write pro-US/EU/Israel propaganda

The Grayzone   The major media company Axel Springer SE, which owns Politico, Business Insider , and top German newspapers, was exposed for forcing its employees to write pro-US/EU/Israel propaganda. It has also been accused of being funded by the CIA. 

US govt-backed social media companies meddle in Nicaragua's elections

The Grayzone   Remember Russiagate claims of "Kremlin meddling"? Well, the US government is blatantly interfering in Nicaragua's elections. Ben Norton and Max Blumenthal discuss how, mere days before Nicaragua's November 7 elections, Meta/Facebook/Instagram, Twitter, and Google/YouTube purged thousands of pro-Sandinista journalists, activists, and media outlets. Meanwhile, the US Congress voted for more crushing sanctions.   They address the gaping holes in Facebook's bogus report falsely claiming the Sandinistas it purged were " government-run troll accounts, " which was written by former Pentagon-funded NATO press officer Ben Nimmo, a symbol of how social media corporations have effectively merged with the US government. 

Assange appeal day 2: Extradition decision update

acTVism Munich   A report on the second day of the appeal hearing in the extradition proceedings of WikiLeaks founder Julian Assange. The defense rebutted claims by the US government arguing that the assurances provided can be revoked at any time and are thus unreliable. Additionally, the court heard evidence that US intelligence plotted to assassinate Assange. A decision on extradition will be delivered in the coming weeks.