JP Morgan Recommends Fascism, Theft of Savings to Cure Europe's Ills
JP Morgan, the bank so impossibly intertwined with governments that it can hardly be called a business enterprise, published a scolding report to European nations. JP Morgan tells them that banks stealing people's savings is normal and should be expected, the crisis wasn't their fault, and that southern European nations need to install fascist governments and dump those pesky civil rights.
You can read it here, but if you don't feel like reading 18 pages of Banksterese, you can read this summary.
Your Money was Actually Our Money All Along
After a turgid introduction, we get a glimpse into the minds of men that feel the theft of private property is not just acceptable, but essential. You see, according to JP Morgan, if the government/bank cartel doesn't have enough money, it can start hunting around in the pockets of private citizens since everything belongs to them anyway.
"Many thought that the Cyprus bailout represented a sea change in the way the crisis was being managed. But, this was not true, in our view. Prior to Cyprus, Euro area sovereigns entering EU/IMF programs had to bear the burden of sovereign deleveraging, bank recapitalization and structural reform, themselves. This pattern continued with the Cyprus bailout, but with the extension that when the respective sovereign’s shoulders were not broad enough to bear the burden of recapitalizing its banks, bank creditors would be bailed in. The Cyprus bailout simply reinforced the message that national legacy problems would be dealt with at the national level."
Let's have a look at that last line again:
"...when the respective sovereign’s shoulders were not broad enough to bear the burden of recapitalizing its banks, bank creditors would be bailed in."
I will translate:
"If the government won't cover our losses with your taxes, we'll take your savings."
Remarkably, JP Morgan assumes as a matter of fact that recapitalizing private banks is the responsibility of the taxpayer, and should be done so at all costs. My only regret is that I'll never know if the authors of this blather wrote it with a straight face.
It's Not our Fault!
JP Morgan has a remarkable bit of gall in the next few paragraphs, when they drop this doozy:
"In the early days of the crisis, it was thought that these national legacy problems were largely economic: over-levered sovereigns, banks and households, internal real exchange rate misalignments, and structural rigidities. But, over time it has become clear that there are also national legacy problems of a political nature. The constitutions and political settlements in the southern periphery, put in place in the aftermath of the fall of fascism, have a number of features which appear to be unsuited to further integration in the region."
"At first, we thought we blew it by loaning all this money to the Greeks, Italians and Spanish at stupidly low rates. However, that makes it sound like we caused the problem, so we're blaming their political system and those darned fascism-haters."
I'll be the first to admit that Southern Europe is no business model I'd like to emulate, so I thought maybe they were on to something there. Maybe they could suggest some wise political changes. Think again.
Our Prescription: Totalitarianism
Instead of recommending a freer economy for calcified Southern Europe, JP Morgan sees their goals best served by totalitarian fascism. Rather than complain about southern Europe's rigid labor laws that make it impossible to get a real job or their Draconian tax schemes, they find fault with the following:
"The political systems in the periphery were established in the aftermath of dictatorship, and were defined by that experience. Constitutions tend to show a strong socialist influence, reflecting the political strength that left wing parties gained after the defeat of fascism. Political systems around the periphery typically display several of the following features: weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems which foster political clientalism; and the right to protest if unwelcome changes are made to the political status quo. The shortcomings of this political legacy have been revealed by the crisis."
The quick translation is as follows:
"It's a shame these guys had such a bad experience with fascism, because these guys really need to install a political strongman, dump those labor rights, and suspend their civil liberties and the democratic process. In a word: fascism."
It is remarkable to hear an apparently sane person regard the right to protest as a shortcoming. I certainly hope no one in the EU feels like they need to listen to this drivel, much less enact it as law. However, given the cozy relationships of sovereign governments and the megabanks, these recommendations may be coming to a dictatorship near you!