Greece and Democracy

The voters of Greece are heading to the polls as I write this and results should be in by 9 PM tonight. Ironically, despite the exercise of democracy in voting for or against the continuation of EU imposed austerity, the Greek people are not really voting on the details of public policy . Rather they are voting for or against a particular direction to deal with the issues of economic health that have plagued Greece since its entry into the Euro Zone. In short Greece has been asked by their government to support further austerity, in the form of higher taxes and lower spending (all of which has already happened in the past few years) or to point in a new direction by rejecting the calls for further austerity and charting a future navigated by the Greek people and their elected government rather than bankers and politicians from the European core.

As James Galbraith writes in The American Prospect and elsewhere ... The challenge in Europe is the narrowness of vision of the European elite. Centered in the governments of the core and bureaucracy of Brussels, these narrow minded leaders, not worthy of the word, have forced the continent into deflation and depression and threatened the whole European project. Achieving nothing but broader smiles in the face of David Cameron and the like who are bound and determined to blowup the entire structure.

All countries knew when they joined the EU they were sacrificing some sovereignty. The hope was the trade off resulted in more peace and more prosperity. And so it did as long as the bubble of trade deficits/debt/housing continued. When that popped the house of cards came tumbling down and with it the vision of Calvanistic punishment for incorrectly perceived profligacy. In the case of Greece, the price of relief from the commercial bankers was a regime imposed by The Troika. Today's vote is a chance for the Greek public to say No!

Yet their democratic choice has been complicated by the interference from the core. It is sadly funny to hear German politicians lecturing the Greeks about responsibility. The bottom line is that Greece should be free to make its choice and move ahead with its direction even if that means leaving the Euro Zone. Greece couldn't join Europe until it through off the shackles of dictatorship and moved to democracy. Why should Europe be demanding a step back when it benefitted from the policies that brought Greece to this point? Obviously leaders like Germany's Merkel are worried about the precedent of Syria in Greece leading to other anti-austerity tendencies like Podemos in Spain (who have elected Mayors in Madrid and Barcelona), the SNP in Scotland and the exciting emergence of Jeremy Corbyn as a candidate for Labour Party leadership in the UK. So they are saying let's rupture democratic processes so we can hang onto our jobs, continue the disastrous conventional wisdom and teach a harsh lesson in moral hazard.

Greece please, Just Vote No. #oxi

Posted with Blogsy

Good news from President Obama ... OT Edition

This week the Administration announced a change of rules which will significantly expand the eligibility of wage earners for overtime pay. This is the type of action that will help the economic fortunes of working families. This is the type of action that the President should concentrate on to secure his legacy. Peace and prosperity should be the watch words for the next 18 months.

With the unemployment rate falling but the workforce participation rate and median wages still stagnant, the long steady recovery from the crisis of 2007 to 2009 has only begun to reach into the homes of working families. With the refusal of Congress to take aggressive action to promote job creation it falls to the President to use his executive authority to move forward a family friendly economic policy. Oddly enough the President pushed hard for fast-track approval to further the trade agenda with the pacific rim. Actions that will lessen the wages and employment prospects of American workers.

Important economic actions are outstanding ... the surface transportation bill has survived on short term renewals; the reauthorization of the Export-Import Bank languishes and we are about to go through another budget drama ... all of which contributes to economic instability at a time when the economy needs help to boost the fortunes of workers. The aggressive actions of the President will pay off with higher approval ratings. And with that perhaps he can drag Congress along in the right direction.