The situation in Greece seems hopeless, no matter how its citizens vote on an emergency referendum Sunday, and the rest of the world seems in pretty sorry shape as well.
Apparently nobody in Greece can understand the 72-word question being put to the voters, assuming that the government is able to print up enough ballots and get them distributed to all the polling places on time, and it’s certainly Greek to us. So far as we can gather, however, a “yes” vote is for accepting the European Union’s seemingly generous offer to continue the loans that have been keeping the Greek economy barely afloat, although in exchange for draconian budget cuts and other austerity measures that will almost certainly be painful to the already pained average Greek, and a “no” vote likely means a Greek exit — or “Grexit,” as it’s become known — from the EU and its onerous demands as well as extravagant promises of continued government largesse, although in reality it will more likely cause the complete collapse of the Greek economy and start causing all those ample government checks to bounce right out of the last of the country’s failing banks.
The very young and stupid Greek Prime Minister and his socialist party are backing the “no” vote, on the argument that it will allow him to negotiate an even more generous deal with his EU creditors, but only the most rash would predict how that might turn out. Germany’s Chancellor Angela Merkel and that the rest of the EU elite would obviously prefer not to lose a charter member of their club, which might bolster the growing number of Eurosceptics in Britain and other important countries as well, and make it embarrassingly clear that their essential organizing policy of a one-size-fits-all currency for a fissiparous coalition of 28 countries that still stubbornly cling to some sense of national interest and have very differently-sized economies was unworkable all along. On the other hand, Greece has become so unproductive and such a pain in the EU’s economic posterior that the club might well decide it is best rid of it, and that if Greece instead becomes a client of Moscow that it would be a small victory for what remains of the West in the renewed Cold War.
In any event, the Greeks will still wind up broke and rioting in the streets against the reality that they can’t forever keep on sending out retirement checks to 50-year-olds and unemployment checks to the more than 50 percent of the 20-somethings who are without jobs and taxing the in-betweens to such an extent that they’ve all stopped paying taxes and produce children and future taxpayers at a dwindling rate and have it all total up to about half the country’s gross domestic product, even if has seemed to work just fine up to now. These schemes always work out for while, and it’s so great when they do that the mean-spirited fuddy-duddies who warned that it would all come to a bad end are thoroughly discredited, but eventually reality intrudes and it does come to bad end and there’s nothing for the idealistic and generous to do but riot in the streets. One is tempted to shake his head in pity and disgust at the Greeks, who once upon a long-ago time gave the world Plato and Aristotle and Euripides and Aristophanes and Sappho and all sorts of intriguing ideas about human nature, but those same long-ago Greeks have taught us to notice that such weakness to temptation is by no means a uniquely Greek thing.
While the Eurocentric American media has mostly paid attention to Greek’s travails, a few stories have leaked out that Puerto Rico is also on the verge of default and bankruptcy. The same sort of extravagant promises made by politicians, and eagerly believed a majority of the country’s voters, have led a large portion of the island’s residents to take advantage of its immigration relationship with the United States and move mainland, which of course has contracted the economy and increased the need for government relief and raised the debt and further hindered the economy and forced more people to flee. Greeks and Puerto Ricans are relatively minor players in the world economy, but Chicago, the third-largest city of the first or second largest economy depending on your accounting methods, whose municipal bonds are now rated as junk, is finding that the promises made to and believed by its vast number of its public servants were a few billion dollars more extravagant than its dwindling number of taxpayers could keep. Similar situations prevail in numerous other American cities and counties and states, as well, and of course the the debt of the federal government is keeping a relative pace with that of Greece. Unlike Greece in its post-Drachma days the United States can keep printing greenbacks to service that debt, and unlike the Euro or the Drachma the greenback is the world’s reserve currency, which seems to be working up to now, but only the rash would predict how that’s likely to turn out.
Lest we sound unduly pessimistic about America so soon before the Fourth of July, we would also note that China, which is the first or second largest economy in the world depending on which accounting method you believe, also has its debt woes. Even in the still more-or-less Communist country felt obliged to make extravagant promises to the people, the people were eager to believe, and now they’re stuck with the gargantuan tab for giant ghost cities and other ambitious make-work projects. Similar examples of human beings succumbing to human nature be found all over the globe, and probably in at least one of the countless tax jurisdictions where you live, and at various points throughout human history.
In between those various points of human history when the clash extravagant promises and economic reality turned out very badly, there were periods of prosperity and the self-sufficiency of citizens and the resultant improvement in human achievement that resulted from the lessons that had been so painfully learned. They all ended when enough time had past that the lessons were forgotten and the extravagant promises became all the more enticing, but the process tends to repeat itself.
There’s some faint hope, we suppose, that here in America these lessons will be re-learned from the examples of Greece and Puerto Rico and China and Chicago and the rest of the bankrupt parts of the world, and that perhaps the inevitable crisis can be forestalled until the next presidential election when the people will choose correct course. Only the most rash would predict how that might turn out, though. Our guess is that the next presidential election will more likely be about homosexual marriage and the latest celebrity’s sex-change operation and subsidized condoms the Confederate battle flag and whatever shiny objects the media might find, and of course the extravagant promises that politicians always make the people are always eager to believe. For now, at least, it all seems to be working out, or at least well enough to make those further extravagant promises sound plausible.
— Bud Norman