Mario Monti, Italy’s new unelected technocrat Prime Minister announced his government’s planned harsh austerity measures. He said we must take these measures not to become another Greece. However he got it the wrong way around.
That is, unfortunately Signor Monti, if you DO take these austerity measures that is what will make Italy ‘another Greece’.
We hear that the neophyte ex communist countries of the EU, Poland, The Czech Republic, Slovenia etc are going bananas at all that money being thrown at Greece, for which they say they have to foot the bill!
But all those billions thrown at Greece do not go to Greece. They go straight to the banks to prop them up. In fact the EU is ‘laundering’ money through Greece to keep the insolvent banks afloat. Greece is not being ‘given’ this money by anyone, least of all by German and Czech taxpayers. On the contrary this recycling of the Greek debt has proved a nice little earner for the lending countries, particularly Germany. These lenders are charging a higher rate than the IMF with spreads in the region of at least 4%.
And the second and worst aspect of this is that not only is none of this money going to the Greek economy but the price for this money is the complete draining of the Greek economy through austerity, extortionist taxation, slashing of social benefits and welfare creating a recession of enormous proportions and rising unemployment. In short the destruction of the Greek Economy.
That is what will happen to Italy if it insists on imposing the Merkozy punishing austerity program.
The Italian Minister Elsa Fornero was right to burst into tears.
We thank her for it.