Friday, May 7, 2010

The Arrogance and Ignorance of the Political Elite: A Case History

German Chancellor Angela Merkel clearly understands what the financial crisis fight is about, but she is severely overestimating her chances of wining. Given that she is a member in good standing of the global political elite, it is fascinating to analyze how absurd her arrogant and economic illiterate comments are about the ongoing crisis.

Merkel said on Thursday:
In some ways, it’s a battle of the politicians against the markets. I'm determined to win. The speculators are our adversaries. That’s why we have to weigh our words more carefully than ever and stand united.
Could she possibly understand the impossibility of what she is saying? She is going to fight the markets, she says. Does she understand that "the markets" are millions of people transacting business for their mutual benefit? Does she really believe that politicians have the power to reverse markets? Does she understand that throughout history governments have attempted to stop market activity, but have only succeeded in distorting market activity, but never killing it. From price controls to drug laws, the history books are filled with attempts by governments to move markets in a way they do not want to go. The history books are also filled with the failure of these attempts. Yet, the Chancellor tells us that by politicians weighing their words and standing united that they are going to somehow beat "the markets."

 Let us look at  the current crisis where the Chancellor wants to battle ""the"markets.". Specifically, let's look at Greece. The government of Greece does not have enough money to pay all its bills. As this becomes more and more obvious, fewer and fewer people want to hold Greek debt. Thus, the interest rate on Greek debt continues to climb to attract buyers of that debt, who are willing to bet that Germany and other countries are going to be  bailed out by Greece and others. How is the Chancellor going to battle this by weighing her words? What does standing united mean? Other countries either pony up to pay the Greek government's tab or they don't and Greece defaults. Those are the options. To speak of battling "the markets" in this situation, pretty much means that by "weighing her words" she thinks she is going to convince investors to buy Greek debt without Germany, or anyone else, ponying up and paying the difference that exists between what Greece owes and what it has available to pay its debt.

Looked at it from this perspective, the Chancellor sounds like a short-game con artist. She will say or do anything to keep the con going one more day. That is the long and short of what she really means when she talks about weighing her words. It's a con, a not very sophisticated con, but a con none the less.

It is only a supreme arrogance and ignorance that could result in the Chancellor declaring that it is politicians against the markets and that she wants to win. She doesn't have a chance. At the end of the day, she and her political global cronies are going to have to either pony up with more money or they will see some defaulting PIIGS.


  1. Really good insight; truly bizarre statements by Merkel. Does the political elite really believe market forces are some sort of imaginary foes? I can't believe they're that ignorant, but perhaps so.

    I'm pessimistic enough to think that their end game is more regulations and taxation, so perhaps this is part of the groundwork for establishing more control by girding for the 'good fight'; all noble causes require sacrifice, you now.

  2. German Chancellor Angela Merkel also said: "First the banks failed, forcing states to carry out rescue operations. They plunged the global economy over the precipice and we had to launch recovery packages, which increased our debts, and now they are speculating against these debts. That is very treacherous," ... "Governments must regain supremacy. It is a fight against the markets and I am determined to win this fight".

    If ever there was a clarion call for global government -- universal regulation of banking, government spending, and economic activity globally by a statesperson, Merkel's statement was it.

    On May 7, 2010, a federalized Europe emerged as a region of global government, as the EU Finance Ministers announced unspecified sovereign debt contagion, fiscal and competitive measures to preserve banking capital and maintain financial institution stability. This at a time when the German Parliament approved seigniorage aid for Greece in exchange for its Parliament approving austerity measures.

    These actions go beyond the EU Currency Treaty and the Lisbon Treaty, as well as German Constitution Law to establish an economic and political union of Eurozone countries in a region of global governance fulfilling the mandate of the The Club of Rome called for in February 1974.

    Brent Jessop in Global article The Transition To A Totalitarian World Government relates that the Club of Rome is the premier think tank comprised of approximately 100 global leaders including scientists, philosophers and political advisors which envisioned totalitarian regional governance, and a unifying global ethic -- a paradigm -- a world consciousness to solve interlocking world problems; and it relates this through published material such as 'Mankind at the Turning Point', and 'The First Global Revolution'

    Time Magazine in article Environment The Club of Rome Act Two, reports that the authors of Mankind At The Turning Point, call for ten interdependent regions of global governance ...

    The ASEAN Nations is yet another one of the ten regions of global governance -- it was announced into existance January 1, 2010 ...

    The North American Continent was the first one of the ten regions of global governance called for. This region of global governance was announced by George Bush, Vincente Fox and Stephen Harper at Baylor University on March 23, 2005; this triumvirate committed the continent to global principles of security and prosperity and created a home, that is a homeland for the continents's people.

    All three of these cases, demonstrate that national sovereignty is a principle of a bygone era. Sovereign nations fell May 7, 2010, to a region of global governance which is led for now by EU Finance Ministers and Leaders of State such as Mrs. Merkel.

    The age of sovereignty is over; the age of global governance has commenced.

    The EU Finance Ministers have effected a bloodless coup.

    Sovereign national governments and their constitutions are now superceded by framework agreements such as the Euro Stability Pact, where regional leaders meet in summits, and then appoint councils, working groups and stakeholders, who work in global government principles and policies of security and prosperity; they set the rules, and the people follow.

    The government leader's efforts will fail to preserve economic stability ... a worldwide financial collapse is at hand. Wealth can only be preserved and maintained by personal ownership of gold.

  3. It looks like a codespeak. By "markets" she's apparently referring to the small group of people who like to identify themselves with the debt market and are more ambitious and at least as powerful as the German chancellor, hence the battle.