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Yanis Varoufakis
Yanis Varoufakis
A New Versailles Treaty is haunting Europe - I used that expression back in the Spring of 2010 to describe the first Greek 'bailout' that was being prepared at that time. If that allegory was pertinent then it is, sadly, all too germane now.
Never before has the European Union made a decision that undermines so fundamentally the project of European Integration. Europe's leaders, in treating Alexis Tsipras and our government the way they did, dealt a decisive blow against the European project.
The project of European integration has, indeed, been fatally wounded over the past few days. And as Paul Krugman rightly says, whatever you think of Syriza, or Greece, it wasn't the Greeks or Syriza who killed off the dream of a democratic, united Europe.
Comment: Who is regulating the regulators in charge of the "living wills?" And, who can hold them to it? At this point it is naive to believe there are any honest and trustworthy agencies connected to law or money, let alone ones that have the clout to enforce compliance. The arms and tentacles of the banks' various and extensive banking mechanisms are so intrenched in this incestuous system that even one bank failure could unravel the whole banking caboodle. Dodd-Frank or no Dodd-Frank, unpayable debt always creates some kind of financial crisis. Your bank account has been legally collateralized against the derivatives debt, thanks to the Bankruptcy Reform Act of 2005, where derivatives counter-parties are given preference ("super-priority") over all other creditors and customers of the bankrupt financial institution. Someone else has first rights to your money.
We all know, in reference to a boat, the idea of a "bail-out" to save the boat. Think about the consequences, in this context, of a "bail-in."