THE LEFT YOU THINK IT IS POSSIBLE TO END The AUSTERITY AND MAINTAIN THE EURO BUT 'A TRAGIC ERROR (PROF. NINO GALLONI)

Sunday, June 29, 2014

Professor Nino Galloni, economist, former lecturer at the Catholic University of Milan and the LUISS University of Modena, tells what developments await Europe after the election, but most importantly, what will happen in Italy, the crock pot is the Old Continent.

Extraordinary interview. Read.

A month before the European elections does not seem to have changed much, except for the fact that the EPP and PES have thrown the mask of fake opposition they have had in recent years and will begin to govern together also in Brussels. What are your predictions, economic and political, for the next few months?

The recent case of Libya proves, beyond any reasonable doubt that in recent months the European Union has made ​​giant steps back, at least for those who believed in the project, and tend to a geopolitical isolation and compared with the major strategies being carried out by the United States, Britain and Saudi Arabia on the one hand, both the new realities of the emerging countries (China, Russia, India, Brazil ...), on the other.

Europe has lost all trains potential and the release of Alfano as interior minister proves it: "you bombed Libya and now leave us alone." It 'a serious situation. From the storm in the glass of water to the European elections has emerged as the vast majority, over 80% l'', the electorate is against austerity. But, prevails, especially in the PES, the idea that we should go out dall'austerity, but remain in the euro, so in this Europe. This position presents irresolvable contradictions, without prejudice to the recent interventions of the ECB. In the short and medium term, in other words, I predict an increase in the social conflict that will not explode in uncontrollable levels only if the monetary measures of the ECB will have an effect on the real economy, as it hoped Dragons. If this does not happen, the crisis will go behind the current Italian government and the main party of the PES in Europe, in both cases, the PD Renzi.

What are the choices to be made immediately in the emergency current company?

Making a public bank in Italy to collateralize loans of public administration that would be, for what I read in the press of the ECB eligible. It may well manage in time about 600 billion Euros with which to make plans for hydrogeological, school construction, a real working plan, the income of citizenship, research and development. Without these resources, it is obvious that we can not really get out of the crisis. The euro has been done to the austerity and austerity for the euro: If you are unable to remedy this contradiction, reducing the conditioning of the Treaties, not if it comes alive.

The emergency I have studied at the national, rather than European. And in Italy you can immediately issue of paper money, the State may issue vouchers, vouchers, certificates of credit erariali to pay its debts denominated in Euros but they are not legal tender, after which this fiduciary money goes to circulate among individuals, restarting the economy and then the state accepts it in payment of taxes and duties. If this is done at the beginning of the accounting year and has an effect on GDP will not increase the deficit. If Italy could invest in this way, 50-100 billion a year of its claims processed in Euros to make investments, then certainly that would incorporate competitiveness and efficiency.

At European level, everything remains at the theoretical level: impose the fact that investments are outside of Maastricht would be a great step forward, but in theory, as it is theoretically also say leave the euro to return to currency devaluations, because the 'EUR was just done to prevent Italy devalued. A bill are the theoretical discourses of esteemed colleagues, I share the analysis and also the solutions, but only at the level of theory and academia. In practice, however, we must confront the fact that the single currency was created to prevent Italy from being too competitive.

In the present context, what is the country that could put a short ultimatum for participation in the euro zone?

If you do not thinks so it comes out: save us all if we accept the same rules and the same logic for the next. If Germany wants un'austerity Limited for themselves and for all the other Europeans (without selecting for the East) and France wants to protect itself, but not for the others it comes out. The real change of views, attitudes, mentality: selfishness leads only to destruction, wars, violent social conflict, barbarism.

Believes, however, that there is a country where the situation is most at risk?

Certainly in France, where social tensions are at breaking point and even Marine Le Pen could prove to be suitable for the leaders to get out, despite his statements altogether moderate and somewhat acceptable. The risk is that other forces take over. Even in Italy can be seen in both M5s on the bright side, ie you have moved a whole series of new energies, but as well the same Grillo said, the fact that he had appeased the degeneration of the protest still potentially out of control ready to ignite. If the 5 Star Movement talks with Nigel Farage, the scenario is post-European, vice versa, the paradox is that with Le Pen may come to a confederation of sovereign states invoked even by Putin. This presupposes, in my opinion, at least a dual circulation. Virtual currency, accounts and offsets and international money real, popular, nationwide.

Interview conducted by Alessandro Bianchi for Antidiplomatico. It - thank you.

ANALYSIS: WHAT WILL HAPPEN 'AFTER THE EUROPEAN MARKETS? THREE SCENARIOS WITH A POINT IN TOWN

What happened Monday on the financial markets - with the surge of violent and spred BTP -Bund falls on the Stock Exchange in Milan - can be seen as the appetizer of what we could expect the next European elections scheduled for Sunday, May 25 .
In risk management it is always wise to do the so-called "what if ", or predict all possible scenarios and possible countermeasures . This discipline abroad is used not only to predict potential disasters , but also in the political and economic , and that's what we'll do in this article.
So let us understand what scenarios we can expect as a result of the European elections , going in descending order of probability.
A) The movements and anti anti EUR u get a clear statement in the individual countries . Under the proportional electoral system with pure electoral threshold , they could obtain a relative majority in parliament in Brussels. According to the projections , these movements are given between 20 and 32% depending on the country . Exceptional results , but may not be sufficient to secure an absolute majority of seats. In this case most likely would become a sort of " big crowded " between PSE and PPE (the two EuroGroups historians) in the name of saving the eu. That 's great (and we might add shameful ) piled up a scenario is already expected and hoped for an old tool of politics as Romano Prodi , who never speaks at random. The union between the PPE and PSE would serve to block any project of democratic reform of the EU and the mechanism of the single currency , thus ensuring the status quo of a predator Germany welfare at the expense of the rest of Europe and a domain unchallenged the interests of banking groups to meet the needs of the people.
To be able to digest in this authentic monster undemocratic European citizens , we expect a number of stock market crashes since Monday, May 26 , perhaps in conjunction with the explosion of the spread between Italian and Spanish government bonds and German ones . At that point, it would trigger the media screaming at risk of collapse of the European Union and the euro with transmissions of apocalyptic future of misery , destruction and wars in Europe ( do not believe us ? Try to look the commercials that go on today Rai in favor of ue) . At that point, the only salvation is precisely the grand coalition to save the eu and the euro , assuring a future of poverty and despair , yes real , in all European citizens . A hint of this is seen Monday, May 19th , with heavy falls in the stock market and tweaking up the spread. The reason ? The result against the traditional parties in favor of u and Greece, with the distinct Advanced Siryza and Golden Dawn .
B) The movements and anti- u and anti EUR exceed all expectations and achieved an absolute majority of seats in the European parliament. In this case it would open a scenario totally new and unexpected for the entire continent . Such a statement would mean a profound rethinking not only of the single currency , but also the very concept of u . Please note: this does not mean return to pre-war nationalism dangerous , but to a more democratic vision of u and , above all, a return to national sovereignty and therefore of democracy. It is a scenario feared by Germany, which would see the threat to its hegemony on the continent about the policies of austerity that has been able to impose on all nations. At this point it is very likely that German banks could start making speculation on sovereign bonds of the countries most in trouble for " break the bank " attributing to others the responsibility . The exchange rate euro dollar threshold is a more than acceptable for the "new mark " , while it is completely untenable for the rest of Europe . What Merkel does not want to , you assume responsibility for the end of the euro ( it never assumed a responsibility in the first person throughout his political career ) or the exit of Germany from the single currency. German banks have been the subject of speculation programmed to force the resignation of the then Prime Minister Silvio Berlusconi , so they would not have problems to make the same play . With spreads risk and skyrocketing debt and a European Parliament hostile to the new policies of austerity, Germany would be " forced " to go out to save its citizens and its businesses from disaster one vote " populist ." At the same children who do not accept the defeat and throw away the toys , Germany could make a mock offense and leave because they " forced " .
C) One of the traditional parties , the EPP or PES, manages to get a majority in the European parliament. E ' scenario less likely , but also the most dangerous of the possible ones. Beyond the statements of the facade , the two EuroGroups historians are actually two sides of the same coin subservient to the interests of big banks and Germany. Their victory would mean a continuation , indeed, the policy tightening austerity imposed by Merkel and the satellite countries , condemning the entire continent to decades of poverty and unemployment. The bags may respond well, as the great economic powers would feel reassured by a similar election results . However this is not certain : the financial markets are largely overestimated , they may decide to give a strong correction indices , sparking a sell-off , however, justifying it with the limited growth prospects of the countries participating in the single currency .
Have you noticed ? All three scenarios include the possibility of heavy stock market declines . The reason ? Simple: the election regardless of the outcome , the indexes are " swollen " and the bubble is ready to burst . What is missing is the motivating factor , but the European elections are the perfect primer : regardless of their outcome , will offer sensible reasons to start the downward wave of speculation .
This means that the voters have voted completely ignoring the signals that are coming from the markets : the threats of " the market wants " are blunt weapons . The market, understood as a rational operator , does not exist except in the minds of economists. There is speculation and the horse park , a third way is not currently scheduled .
What matters , therefore, is going to vote and vote for the model of Europe that you want for the future: on the one hand of the peoples of Europe , where the market has managed to bring the well-being of the people ( the European social model pursued until the fall of the Berlin Wall . remember ? a pension acceptable , a health service , worthy of the name , social safety nets can give peace to the people ) , on the other that of a continent subject to the requirements of finance, where the welfare is reserved to a few thousand people and millions of individuals are condemned to a life on the edge of subsistence. Think it's too pessimistic? Go and ask the millions of Greek citizens without heating and health care.
On May 25 , however, goes, will be a watershed era for Europe