Mike Whitney — Big Finance moves in

Greek Prime Minister Georgios Papandreou and Italian Prime Minister Silvio Berlusconi have both been forced from office and replaced by representatives of big finance. Mario Monti, who will replace Berlusconi, was formerly the European Chairman of the Trilateral Commission and a member of the Bilderberg Group. He is also listed on Goldman Sachs board of international advisers.

Lucas Papademos, who will replace Papandreou, was formerly the Vice President of the European Central Bank (ECB), and served as Senior Economist at the Federal Reserve Bank of Boston in 1980. He’s also been a member of the Trilateral Commission since 1998.

It’s also worth noting that the ECB’s new president, Mario Draghi, is a trustee at the Brookings Institution, a Fellow of the Institute of Politics at the John F. Kennedy School of Government at Harvard, a former member of the Board of Directors of the Bank for International Settlements, and a former Managing Director at Goldman Sachs.

Global banking is an incestuous business where pedigree is everything. One’s personal history indicates their commitment to the system and whether they can be trusted to implement the policies that directly benefit finance capital.

This new group of so-called “technocrats” will use their power to impose harsh austerity measures aimed at crushing the unions, dismantling the pension system, and privatizing public assets. Their belt-tightening policies will intensify the slump, shrink government revenues, increase unemployment and foment social unrest. As more of the eurozone’s leaders are replaced by bank hirelings, opposition to further eurozone integration will appear in the form of nationalist groups demanding a withdrawal from the 17-member monetary union. Peaceful protests will turn in pitched battles with police and state security forces as working people fight to have their voices heard. These confrontations will grow more commonplace as the economy deteriorates and desperation increases.....

Read the rest at Counterpunch

Big Finance Moves In
by Mike Whitney

(h/t Kevin Fathi via email)

If you don't read the full post, Whitney's conclusion is worth pondering:

Professors Markus Brückner and Hans Peter Grüner have explored the relationship between economic crises and political extremism, and presented their findings in an article titled “The OECD’s growth prospects and political extremism.”

Here’s an excerpt:“Higher per capita GDP growth is significantly negatively linked to the support for extreme political positions. While estimates vary between specifications, we find that roughly a one percentage point decline in growth translates into a one percentage point higher vote share of right-wing or nationalist parties….

"Our results therefore make clear that countries should not expect right-wing parties to get majorities unless growth declines quite as much as in the 1920s. Nevertheless, even with a less significant fall in economic growth rates, a rise in support for extreme parties is likely to change political outcomes – for example through their impact on incumbent parties’ political platforms….

"Our results lend support to Benjamin Friedman’s view that economic growth determines the direction in which a democracy develops. This also implies that solving Europe’s growth problem may have important consequences that lie outside the purely economic sphere.” (“The OECD’s growth prospects and political extremism”, VOX EU)

If Professors Brückner and Grüner are right, then we can expect to see a steady rise in right wing groups sprouting up in countries across the south. Their popularity, in large part, will depend on their ability to rekindle nationalism and to pin the ongoing depression on the troika’s policies. If they succeed, then their ranks will swell and their demands –of an immediate withdrawal from the 17-member monetary union and a restoration of national sovereignty–will lead to a splintering or, perhaps, breakup of the eurozone.