Since March 2010, the Jesuit 4th-Reich European Union (EU) and their International Monetary Fund (IMF) have applied 23 tranches comprising €206,9 billion to the so-called "Greek bail-out". They have however provided hardly any documentation on the exact usage of those huge amounts of public funds. ATTAC Austria has therefore put up an investigation on the issue: At least 77% of the bail-out money can directly or indirectly be attributed to the financial sector.
The results in detail:
- €58,2 billion (28,13%) were used to recapitalise Greek banks – instead of restructuring the too big and moribund sector in a sustainable way and letting the banks' owners pay for their losses.
- €101,331 billion (48,98%) went to creditors of the Greek state. €55,44 billion of these were used to repay maturing government bonds – instead of letting the creditors bear the risk for which they had received interest payments before. Another €34,6 billion served as incentive to make creditors agree to the so-called "haircut" in March 2012. €11,3 billion were used in a debt buyback in December 2012, when the Greek state bought back almost worthless bonds from its creditors.
- €43,7 billion (22,46%) went into the national budget or couldn't be definitively attributed.
- €0,9 billion (0,43%) were used as Greek contribution to the new bail-out fund ESM.
"The goal of the political elites is not the rescue of the Greek population but the rescue of the financial sector", Lisa Mittendrein of ATTAC concludes. "They used hundreds of billions of public money to save banks and other financial players – and especially their owners – from the financial crisis they caused."
POLITICAL ELITES DISTORT PUBLIC VIEW OF "RESCUE PACKAGES"
These findings refute the position publicly taken by European politicians that it is the Greek population who benefit from the so-called "rescue packages". They are rather the ones paying for the rescue of banks and creditors by suffering from a brutal course of austerity and its well-documented catastrophic social consequences.
BILLIONAIRES AND HEDGE FUND BENEFIT
Among those actually rescued is the multi-billion Latsis clan, one of the richest families in Greece, owning large parts of the state-rescued "Eurobank Ergasias". (1) Speculators benefited, too: During the debt buyback in December 2012, the hedge fund Third Point pocketed €500 million with the aid of European public funds. (2) "When Barroso, the President of the European Commission, labels the so-called Greek bail-out an act of solidarity, you have to ask: Solidarity with whom?", Mittendrein comments. (3)
ANOTHER €34,6 BILLION IN INTEREST PAYMENTS
A maximum of €43,6 billion (22,46%) of the so-called "rescue packages" went into the Greek national budget. However, this amount has to be seen alongside other state expenses during the same period which didn't benefit the general population. More than €34,6 billion were yet again paid to creditors as interest payments for outstanding government bonds (2nd quarter 2010 to 4th quarter 2012 (4)). Moreover, the Greek state put another €10,2 billion into military spending (2010 and 2011 (5)). According to insiders, the governments in Berlin and Paris pressure Greece not to cut military spending because that would affect German and French arms companies. (6)
NOT THE FIRST BANK BAIL-OUT
"The so-called Greek bail-out turns out to be another bail-out for banks and wealthy individuals", Mittendrein says. European banks have already received €670 billion of direct state support (not including guarantees) since 2008. (7) Still, the financial sector in Greece and all over Europe remains unstable. This is once again proven by the recent disbursement of two more tranches dedicated to bank recapitalisations comprising €23,2 billion since December 2012.
POLITICAL ELITES FAIL TO IMPLEMENT NEEDED REGULATIONS…
The Greek state's haircut hit local banks so hard that the state is forced to go into debt again to save them with a billion-euro bail-out. "In the five years that passed since the financial crash, Europe's politicians have failed to regulate the financial markets and adopt a bankruptcy regime for banks. So taxpayers are still forced to help out in case of losses, while the banks' owners are getting away scot free. The governments have to stop giving this kind of blackmailing opportunity to the financial sector", Mittendrein criticises.
…AND RESCUE CORRUPT GREEK BANKING SECTOR
What's even worse is that billions of bail-out money go to Greek banks even though some of them only meet the official conditions by resorting to dubious methods. In 2012, a Reuters report exposed the banks' scandalous practices of using a Ponzi scheme of offshore companies to shove unsecured loans on to each other. They did this to appear to still be able to attract private capital and thus meet the conditions for state recapitalisation. (8) "While the European and the Greek political elites demand blood and tears from the ordinary Greek people, they turn a blind eye to the secret deals amongst financial oligarchs, who are in fact the main beneficiaries of the bail out money given to Greece”, confirms economist Marica Frangakis, a member of the Athens-based Nicos Poulantzas Institute, and a founding member of ATTAC Hellas.
INTRANSPARENT HANDLING OF PUBLIC FUNDS
"Our results reveal that the main goal of our governments' crisis management policy since 2008 has been to save the fortunes of the wealthiest. The political elites accept tremendous unemployment, poverty and misery – to save a financial sector beyond remedy. The Austrian government has taken part in this inhuman course of action for years, too", Mittendrein adds. It is furthermore alarming that those in charge at the Troika and the EFSF are barely documenting their handling of public funds. "It is a scandal that the European Commission publishes hundreds of pages of reports but fails to specify where the money went to exactly", Mittendrein explains. "We call upon those responsible to impose real transparency and prove who is actually benefiting from the payments."
RADICAL CHANGE OF POLICY IS OVERDUE
A radical change of course is overdue in European crisis management policy. "Our governments save European banks and the wealthy with billions and billions of public funds while pretending to their voters that the money is transferred to the Greek population. This has to stop", Mittendrein and Frangakis demand. Banks "too-big-to-fail" have to be split and return to serving public welfare instead of private profits. Creditors and the rich have to pay their share of the crisis' costs while the financial sector must be severely regulated. "After three years of devastation caused by imposed austerity, Greece is in need of real rescue packages that actually reach the general population", Lisa Mittendrein concludes.
MORE BIZARRE DETAILS
Moreover, the investigation conducted by ATTAC brought to light several bizarre details of the so-called "Greek bail-out":
- Several times, EU and IMF reneged on their announcements and withheld promised disbursements by weeks or even months to put pressure on Greek democracy: in autumn 2011 to prevent a referendum on austerity policy; in May/June 2012 to raise the chances of Troika-friendly parties in the national elections. By withholding promised funds, the Troika forces the Greek government to issue short-term bonds to avoid imminent bankruptcy. Since those "treasury bills", maturing within a few weeks or months, carry a higher interest rate, this actually increases Greek government debt. This serves as further evidence that debt reduction is not the Troika's main interest, but rather a pretext to push forward the destruction of the welfare state and workers' rights.
- A tranche of €1 billion disbursed in June 2012 was primarily used to finance Greece's compulsory contribution to the EFSF-replacement ESM. Thus, the EFSF financed its own successor – yet not directly but by raising Greek government debt.
- Klaus Regling, managing director of EFSF and ESM, has switched between politics and the financial sector numerous times during his career. Before joining the EFSF, he worked in turn for the German government, the hedge fund Moore Capital Strategy Group, the European Commission's Directorate-General for Economic and Financial Affairs and the hedge fund Winton Futures Fund Ltd. Regling thus stands as a symbolic example of the intertwining between financial markets and politics which partly explains why the EU's crisis management policy is primarily aimed at saving the financial sector.
- According to its Annual Accounts, the EFSF's personnel costs amounted to €3,1 million in 2011. (9) According to media reports, 12 people worked for the EFSF in this year, (10) so an average €258.000 was spent per person. Managing director Klaus Regling allegedly earns €324.000 plus extra pay per year (11). People making these amounts of money supervise the reduction of the Greek gross minimum wage to €580 per month (€510 for youths) (12).
The other 23% went to top IMF executives, their negotiators, the Greek top government and the financial Institutions shareholders ranging from the GRAY Masters, the Black Nobility, Black Aristocracy (black as character not colour of their skin) and wealthy elites. Like 2008 crisis, the young working class foot the bill.
Start with the basics of their international financial system. This system, in which mere money, rather than physical wealth, is considered valuable, is reaching a limit to its ability to loot from the physical economy. The result of this is an enormous speculative bubble that is beyond bankrupt, totaling some $2 quadrillion in worthless financial assets that cannot conceivably ever be paid, a hyperinflationary growth of worthless debt that LaRouche originally warned in 1971 would be the inevitable consequence of the dismantling of FDR’s Bretton Woods system.
How in the world did we ever allow this to happen? With the end of the fixed exchange-rate Bretton Woods system in 1971, international financial interests unleashed global speculation on national currencies and futures markets, which left a wake of devastation across the Third World, in particular. Then in 1999, these same financial interests induced the United States to jettison FDR’s 1933 Glass-Steagall law, which had strictly separated commercial banks from speculative investment banks. That unleashed rampant speculation in derivatives, which came to represent some 90% of all world financial assets. Between the 1999 repeal of Glass-Steagall, and the 2008 blowout of the world financial system, total financial instruments soared from about $260 trillion to a staggering $1.4 quadrillion—a five-fold increase in a decade!
That was bad enough. But then, the “solution” put in place by Wall Street and London in 2008 to try to save their system, made everything far, far worse. Hyperinflationary “Quantitative Easing” (QE) was launched, which to date has added about $9 trillion in worthless money to the bubble, in an attempt to bail out the banks. This bail-out accelerated dramatically in 2013 and 2014, raising total world financial aggregates from about $1.5 quadrillion at the end of 2012, to nearly $2 quadrillion today—a 33% jump in only two years.
The hyperinflationary growth of total global financial aggregates over the period 1980-2014, measured in quadrillions of dollars. The vertical lines in 1999 and 2007 mark the repeal of the Glass-Steagall Act and the global financial crisis, respectively.
At the same time that they have fed the cancer relentlessly with every imaginable form of bail-out, the British Empire has also used its bail-in fraud, codified in the Dodd-Frank bill in the U.S., to loot the population to the bone, stealing everything—from people’s bank accounts, to their pensions, to their insurance, to their very livelihood. In Europe, youth unemployment has soared across the Eurozone, hitting over 60% in Greece and Spain.
The United States is no better: more than half of the states have real youth unemployment rates exceeding 30%. On Obama’s watch, the number of Americans below the official poverty line rose from 37 million to 48 million. The southwest portion of the country is suffering such devastating drought—aggravated by decades of neglect to build new infrastructure as well as the destruction of that which had already existed—that it is dying from lack of water.
In short, we are in the final phase of a general breakdown crisis of the economic system as a whole in which we are facing the simultaneous explosion of fictitious speculative financial values, while the actual physical economy, on which the lives of the population depends, has been intentionally shattered. Lyndon LaRouche’s “Triple Curve Typical Collapse Function” is the best representation of the deadly process now underway—and why it cannot continue.
An updated version of a heuristic graphic first developed by LaRouche in 1996 to
demonstrate the inevitability of the collapse of the speculative financial system.
The physical economy has been so decimated, that one would almost think that it is the result of an intentional policy of the British Empire to kill people off— which in fact it is. The stated policy of the British Queen, her consort Prince Philip, and their imperial spokesmen, is to rapidly reduce the population of the planet from some seven billion human beings today, down to one billion or less. Prince Philip himself has stated this policy unequivocally, when he bragged:
In the event that I am reincarnated, I would like to return as a deadly virus, in order to contribute something to solve overpopulation.