The 13th Labor of Hercules

That fire-bomb attack we mentioned yesterday … that’s only the beginning. It’s just a taste of what’s in store for the global community.

Tony Bonsignore, writing in “City Wire” on May 7th, asks; “Would You Put Up With What Is Being Asked of the Greek People?”

“Want to know exactly why public anger in Greece is running at such explosive levels? Then take a look at the austerity measures currently being debated by the Greek parliament.

“The BBC reports that as part of the IMF/EU bailout, Greek leaders are proposing the following measures:

– Public sector pay to be frozen till 2014;
– Public sector salary bonuses – equivalent to two months’ extra pay – to be scrapped or capped;
– Public sector allowances to be cut by 20%
– State pensions to be frozen or cut, with the contribution period up fro 37 to 40 years;
– The average retirement age raised from 61 to 63, and early retirement restricted;
– VAT to be increased from 19% to 23%;
– Taxes on fuel, alcohol and tobacco raised to 10%;
– A new one-off tax on profits to be introduced, plus new gambling, property and green taxes.

“On their own, any one of these measures would probably be enough to prompt significant political disquiet; taken together they represent a catastrophic setback to the financial aspirations of the average Greek.

“It certainly isn’t what the Greek population voted for when they entered the EU in 1981 and adopted the single currency two decades later.

“The country’s government argues that it has no choice if it is to avoid an even greater catastrophe.

“‘We are all responsible so that it does not take the step into the void,’ prime minister Karolos Papoulias argues, warning that the country is on the ‘brink of the abyss.’

“Others, though, argue that Greece is being held for ransom by the EU and the IMF for ideological reasons, and that there are other more equitable options available.

“Leave the single currency, for example, or nationalize Greece’s banks.

“Or even default or restructure, and leave those German and French banks with massive holdings of Greek debt to deal with the consequences of their own investment folly.

“More broadly, protestors argue that they are being made to pay for a crisis they did not cause, and which wealthy speculators are still profiting from. That is inherently unfair, they say, and it must not be allowed to pass.

“It all adds up to a huge dilemma for the Greek government …

“Put simply:” the writer asks, “Would you put up with what is being asked of the Greek people?”

Forewarned is forearmed, and as we said, it’s just the beginning. Sunday’s NY Times had this:

“Greek Debt Woes Ripple Outward, From Asia to U.S.”

“The fear that began in Athens, raced through Europe and finally shook the stock market in the United States is now affecting the broader global economy, from the ability of Asian corporations to raise money to the outlook for money-market funds where American savers park their cash …

“‘It’s not just a European problem, it’s the U.S., Japan and the U.K. right now,’ said a bond fund manager in London. ‘It’s across the board.’

“The crisis is so perilous for Europe that the leaders of the 16 countries that use the euro worked into the early morning Saturday on a proposal to create a so-called stabilization mechanism intended to reassure the markets. On Sunday, finance ministers from all 27 European Union states are expected to gather in Brussels to discuss and possibly approve the proposal …

“In Spain Saturday, Vice President Joseph R. Biden, Jr. underscored the importance of the issue after meeting with Prime Minister Zapatero. ‘We agreed on the importance of a resolute European action to strengthen the European economy and build confidence in the markets,’ Mr. Biden said. ‘And I conveyed the support of the United States of America toward those efforts.’…

“‘Up until last week there was this confidence that nothing could upset the apple cart as long as the economy and jobs growth was positive,’ said the managing director of Pimco, the bond manager. ‘Now fear is back in play.’…

“‘It seems like only yesterday that European policy makers were gleefully watching the U.S. get its comeuppance, not appreciating the massive tidal wave coming at them from across the Atlantic.’ said Kenneth Rogoff, a Harvard professor of international finance who also served as the chief economist of the International Monetary Fund.”

Except for that “jobs growth was positive” baloney, not once is there a mention of the joblessness that’s sinking the global economy. In their ivory towers these politicians and analysts can’t seem to realize that the real problem is the unemployed man on the street – not unprofitable markets.

As we said, “Forewarned is forearmed.” It’s either jobs or fire-bombs. Take your pick.

Believe it or not, it will all come down to a U.S. Emergency Shipbuilding Program … as we said.