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

The big fraud behind the outrageously high natural gas prices revealed

globinfo freexchange   Speaking at the Greek radio broadcaster Real FM 107,1, the Greek economist, Yanis Varoufakis, revealed the real reason behind the outrageously high natural gas prices, which can't be justified only by the war in Ukraine and Putin's actions to cut supplies to Europe.    As he pointed out, the biggest part of the rise of natural gas prices is due to the stock market games. Prices should rise by 80% at most, not 800%. The rest of this hyper-profit is because big companies have already bought quantities of natural gas for the next two years. So, they don't sell it now in order to boost its price and sell it later at much higher price.    Yet, the worst part of the story is that these financial games often create bubbles - similar to the Lehman Brothers bubble in 2008 that led to the Wall Street collapse - so we are now to the point where the German government is forced to subsidize big companies with billions, exactly because they play these risky financ

Greek ‘Watergate’: Mitsotakis’ authoritarianism cannot be tolerated anymore

Greek Prime Minister Kyriakos Mitsotakis is a “destabilising factor” for the country and citizens cannot stand his “authoritarian” attitude, senior socialist lawmaker Michalis Katrinis told EURACTIV after it was unveiled that the secret services bugged the phone of Greek socialist opposition leader and MEP Nikos Androulakis.   by Sarantis Michalopoulos   Part 2 - ‘Protecting’ the company which bought Predator   In July, the European Parliament services also found that there was an attempt to bug Androulakis’ phone with the illegal Predator spyware. A couple of months earlier, it was revealed that journalist Thanasis Koukakis was targeted by Predator, another nail in the coffin of the country’s dismal media freedom record under Mitsotakis. For Katrinis, the government is “protecting” the company that purchased the illegal surveillance spyware. “ A month after the scandal was revealed, no search has been made at the offices of the company that trades Predator, ” Katrinis said, adding tha

Day 1243: Julian Assange still in prison and under slow-motion execution by the Anglo-American imperialist criminals

failed evolution   On 11 April 2019, the Ecuadorian government of traitor Lenin Moreno, invited the Metropolitan Police into the Ecuadorian embassy in London, and they arrested Julian Assange . Since then, Assange is kept in Belmarsh high security prison in London, without actual charges.   The real reason world's number one political prisoner is still kept in this high security prison, is because he exposed horrendous war crimes carried out by the US imperialists and their allies.   The ruthless Western imperialist regime wants to punish the No1 real journalist in the world and make him an example for any Whistleblower or real journalist who will attempt to expose its big crimes in the future.   And the Anglo-American axis has now become officially a fascist coalition , framed by the rest of its Western pets. UK's Home Secretary Priti Patel, one of the most ruthless ever, decided to extradite Julian Assange to US. No surprise of course. The only question we had in mind is

One more Greek lawmaker files complaint over attempted phone hacking

A lawmaker in Greece's main opposition party filed a complaint with the top court's prosecutor on Friday over what he said were repeated attempts to infect his mobile phone with the Predator malware, the latest incident in a phonetapping scandal. Last month, Greek lawmakers voted in favour of setting up an inquiry commission to probe the phone tapping of a political opposition leader that led Prime Minister Kyriakos Mitsotakis to sack the head of the country's intelligence service (EYP).   The scandal over the wiretapping of Nikos Androulakis, leader of the socialist PASOK party, Greece's third-largest political party, has turned up the heat on the conservative premier who brought EYP under his control after taking office three years ago. On Friday, Christos Spirtzis, a former minister and close associate of SYRIZA party leader Alexis Tsipras, said that last November two attempts to hack his phone were made via suspicious text messages prompting him to click on links. 

Greek ‘Watergate’: Mitsotakis’ authoritarianism cannot be tolerated anymore

Greek Prime Minister Kyriakos Mitsotakis is a “destabilising factor” for the country and citizens cannot stand his “authoritarian” attitude, senior socialist lawmaker Michalis Katrinis told EURACTIV after it was unveiled that the secret services bugged the phone of Greek socialist opposition leader and MEP Nikos Androulakis.   by Sarantis Michalopoulos   Part 1   The Greek “Watergate” as described by international media caused a political earthquake in the Mediterranean country, sparking resignations from the prime minister’s secretary general and nephew, Grigoris Dimitriadis and secret services chief Panagiotis Kontoleon. “ Also, the resignation of the PM’s nephew and closest associate raises many questions since it was not done for reasons of avoiding the toxic atmosphere, as was initially said. The sacrifice of Mr. Dimitriadis probably hides a lot and remains to be investigated, ” Katrinis noted. Mitsotakis, however, is hanging on for dear life. “ Mitsotakis is now a destabilising f

The Queen and her legacy: 21st century Britain has never looked so medieval

by Jonathan Cook   Part 1   Anyone in the UK who imagined they lived in a representative democracy – one in which leaders are elected and accountable to the people – will be in for a rude awakening over the next days and weeks. TV schedules have been swept aside. Presenters must wear black and talk in hushed tones. Front pages are uniformly somber. Britain’s media speak with a single, respectful voice about the Queen and her unimpeachable legacy. Westminster, meanwhile, has been stripped of left and right. The Conservative, Liberal Democrat and Labour parties have set aside politics to grieve as one. Even the Scottish nationalists – supposedly trying to rid themselves of the yoke of centuries of English rule presided over by the monarch – appear to be in effusive mourning.  The world’s urgent problems – from the war in Europe to a looming climate catastrophe – are no longer of interest or relevance. They can wait till Britons emerge from a more pressing national trauma. Domestically, t

Liz Truss: worse than Margaret Thatcher?

failed evolution UK ruined the opportunity to elect one of the best PMs that would really work for the people: Jeremy Corbyn. Instead, the country got now one of the worst PMs ever: Liz Truss.

Congressional Democrats shun Ukraine peace campaign

The Grayzone   Veteran antiwar activists Medea Benjamin and Tighe Berry speak to Max Blumenthal about Code Pink's new campaign for negotiations between the US and Russia over Ukraine and a halt to billions in military aid. Benjamin and Berry discuss the chilly reception their advocacy received from even some progressive Democratic members of Congress and critique "America First" Republicans that claim to oppose the Ukraine proxy war. Benjamin and Berry also discuss the state of the US antiwar movement and the arbitrary post-1/6 restrictions which prevent the public from entering the US Capitol building to lobby members of Congress.

Day 1253: Julian Assange still in prison and under slow-motion execution by the Anglo-American imperialist criminals

failed evolution   On 11 April 2019, the Ecuadorian government of traitor Lenin Moreno, invited the Metropolitan Police into the Ecuadorian embassy in London, and they arrested Julian Assange . Since then, Assange is kept in Belmarsh high security prison in London, without actual charges.   The real reason world's number one political prisoner is still kept in this high security prison, is because he exposed horrendous war crimes carried out by the US imperialists and their allies.   The ruthless Western imperialist regime wants to punish the No1 real journalist in the world and make him an example for any Whistleblower or real journalist who will attempt to expose its big crimes in the future.   And the Anglo-American axis has now become officially a fascist coalition , framed by the rest of its Western pets. UK's Home Secretary Priti Patel, one of the most ruthless ever, decided to extradite Julian Assange to US. No surprise of course. The only question we had in mind is

The Chris Hedges Report: Ukraine and the crisis of media censorship

The Real News Network   Throughout the Ukraine war, Western news outlets have mindlessly parroted the opinions of a ruling elite and overseen a public discourse that is often unhinged from the real world.   Patrick Lawrence was a correspondent and columnist for nearly 30 years for the Far Eastern Economic Review, the International Herald Tribune and The New Yorker . He is the author of Somebody Else's Century: East and West in a Post-Western World and Time No Longer: America After the American Century .