Was Europe Saved?

Yesterday I found myself reading with great interest Jeff Madrick’s latest post to NYRBlog, “How to Save Europe.”  This morning the news was that the European leaders meeting in Brussels had come to an agreement on a plan to solve the European debt crisis.  BBC News managed to reduce the substance of this plan to three bullet points:

·      Banks holding Greek debt would accept a 50% loss

·      A mechanism to boost the eurozone's main bailout fund to about 1tn euros (£880bn; $1.4tn)

·      Banks must also raise more capital to protect them against losses resulting from any future government defaults

Note the “t” in that second bullet.  “Trillion” has now become the accepted unit of discourse in financial planning (but we are used to that on this side of the pond).

My guess is that Madrick’s thoughts did not have much impact on the eventual agreement.  On the other hand there was a throwaway line on BBC World Service radio yesterday that may have been more informative about sources of influence behind this agreement.  It turns out that Brussels was hosting a “parallel” conference of leaders of the major worldwide banks and that (to no one’s surprise) some of the European leaders (such as Angela Merkel) were spending more time listening to the banksters than negotiating with her geopolitical colleagues.

Thus, when European Commission President Jose Manuel Barroso reported the deal to the European Parliament, he concluded:

We are showing that we can unite in the most difficult of times.

This may not have given credit where it is most due.  I fear that these days heads of state, regardless of the countries they represent, are little more than sheep.  They only go where the sheepdogs herd them;  and the sheepdogs are, of course, the banksters.  Keeping the banks happy will always be more important than keeping the constituents happy.  That is the motivating force behind Occupy Wall Street and the now many parallel “Occupy” protests it has spawned.  The banksters, of course, wish to keep this “inconvenient truth” concealed;  and, for the most part, the mainstream media have put their best efforts into maintaining that concealment.  Now, however, the protests are starting to be met with ugly responses;  and, following the European lead, the response to those responses may well be a series of general strikes.

There is a popular thesis that the most important lesson of the First World War was that the European institutions of hereditary monarchies could no longer cope with the new global problems of the early twentieth century.  Perhaps this is true of any institution, that, no matter how popular or extensive it is, conditions arise under which it is no longer effective.  Unfortunately, as we saw in the last century, decrepit institutions do not give up their institutional status readily.  The only question that matters is that, when transition finally begins to occur, will it be achieved in a relatively painless manner?  After all, the banksters themselves are not going to resort to combat;  so what will they do when they discover that they cannot buy others to do it for them?