Newsgroup: it.politica
Titolo: Varoufakis spiega (2011) gli enormi costi di un'uscita dall'euro

http://yanisvaroufakis.eu/2011/11/27/abandoning-a-sinking-ship-a-plan-for-leaving-the-euro/
 
 
Abandoning a sinking ship? A plan for leaving the euro
 
As regulars of this blog know, I am of the view that the eurozone’s 
collapse will be a harbinger of a postmodern 1930s. While virulently 
opposed to the eurozone’s creation, in its time of crisis I have been 
campaigning for saving the euro. Of course, as Alain Parguez wrote aptly 
here, it is impossible to save someone, or something, that does not want 
to be saved. In this post, while not going back on my personal 
commitment to keep trying to save a monetary union bent on 
self-destruction, I shall relate to you an idea on how a peripheral 
member-state could try to minimise the (huge) socio-economic costs of an 
exit from the eurozone forced upon it by the latter’s steady disintegration.
 
The said plan was put together with Ireland in mind. Its authors are 
Warren Mosler (an investment manager and creator of the mortgage swap 
and the current Eurofutures swap contract) and Philip Pilkington, a 
journalist and writer based in Dublin, Ireland. Their starting point is 
a (perfectly spot on) diagnosis: “austerity programs” are “an abject 
failure and yet European officials continue to consider them the only 
game in town. So, we can only conclude at this stage that, given that 
European officials know that austerity programs do not work, they are 
pursuing them for political rather than economic reasons.”
 
For reasons that I have also put forward repeatedly, unless overturned, 
this political project will, perhaps unintentionally, lead to the 
eurozone’s collapse. Should a country like Ireland wait until the bitter 
end or should it prepare for an exit before the final nail has been 
hammered into the euro’s coffin? Mosler and Pilkington argue for an 
exit. But how can Ireland, or for that matter Portugal or Greece or 
Italy, exit without the sky falling on our heads? Here is what they 
propose. For the complete text click here:
 
1. Upon announcing that the country is leaving the Eurozone, the 
government of that country would announce that it would be making 
payments – to government employees etc. – exclusively in the new 
currency. Thus the government would stop using the euro as a means of 
payment.
 
2. The government would also announce that it would only accept payments 
of tax in this new currency. This would ensure that the currency was 
valuable and, at least for a while, in very short supply.
 
And that is pretty much it. The government spends to provision itself 
and thereby injects the new currency into the economy while their new 
taxation policy ensures that it is sought after by economic agents and, 
thus, valuable. Government spending is thus the spigot through which the 
government injects the new currency into the economy and taxation is the 
drain that ensures citizens seek out the new currency.
 
The idea here is to take a ‘hands off’ approach. Should the government 
of a given country announce an exit from the Eurozone and then freeze 
bank accounts and force conversion there would be chaos. The citizens of 
the country would run on the banks and desperately try to hold as many 
euro cash notes as possible in anticipation that they would be more 
valuable than the new currency.
 
Under the above plan, however, citizens’ bank accounts would be left 
alone. It would be up to them to convert their euros into the new 
currency at a floating exchange rate set by the market. They would, of 
course, have to seek out the currency any time they have to pay taxes 
and so would sell goods and services denominated in the new currency. 
This ‘monetises’ the economy in the new currency while at the same time 
helping to establish the market value of said currency.
 
My reaction to this plan is simple: It is a  blueprint for anyone who 
thinks that the euro system is past the point of no return. Once that 
point has been and gone, it is perhaps essential to move into this 
direction swiftly. However, I do not believe that the eurozone is, 
presently, past the point of no return. It is still possible to salvage 
the common currency by means of something akin to our Modest Proposal. 
It may take more intervention by the ECB than the Modest Proposal 
envisions (courtesy of the awful delay in implementing a rational plan, 
continuing instead on the present unsustainable path) but it is still, I 
think, feasible.
 
The reason why I am adamant that this is not, yet, the time to abandon 
ship, is the huge human cost of the eurozone’s breakdown. Consider for 
example what will happen if we, indeed, adopt the exit plan proposed above.
 
All contracts by the government to the private sector (abroad and 
domestically) will be renegotiated in the new currency after the initial 
depreciation of the latter. In other words, domestic suppliers will face 
a large haircut instantly. Many of them will declare bankruptcy, with 
another large lump sum loss of jobs.
The banks will run dry and will not be kept open by the ECB. Which means 
that the only way Ireland or Greece or whoever adopts this plan can keep 
its banks open is if they are recapitalised in the new domestic currency 
by the Central Bank. But this means that bank account deposits will, de 
facto, be converted from euros to the new currency; thus annulling the 
beneficial measure of no compulsory conversions of bank holdings into 
the new currency (see above).
The authors claim that the above ill effects will be lessened by the 
government’s new found monetary independence which will enable it to 
discontinue austerity programs immediately and adopt counter-cyclical 
fiscal policy, as Argentina did after its default and discontinuation of 
the pesos-dollar peg. This may be so but all comparisons with Argentina 
must be taken with a large pinch of salt. For Argentina’s recovery, and 
associated fiscal policies, was far less due to its renewed independence 
and much more related to a serendipitous rise in demand for soya beans 
by China.
While it is true that the weaker currency will boost exports, it will 
also have a devastating effect: The creation of a two tier nation. One 
nation that has  access to hoarded euros and another that does not. The 
former will acquire immense socio-economic power over the latter, thus 
forging a new form of inequality that is bound to operate as a break on 
development for a long while – just like the inequality that sprang up 
in the post 1970s period did enormous damage to our countries’ real 
development (as opposed to GDP growth numbers) in the second postwar phase.
Last, but certainly not least, even if one country exits the eurozone in 
this manner, the eurozone will unwind within 24 hours. The European 
System of Central Banks will break instantly down, Italian spreads will 
hit Greek levels, France will turn instantly into a AA or AB rated 
country and, before we can wistle the 9th Symphony, germany will have 
declared the re-constitution of the DM. A massive recession will then 
hit the countries that will make up the new DM zone (Austria, the 
Netherlands. possibly Finland, Poland and Slovakia) while the rest of 
the former eurozone will labour under significant stagflation. The new 
intra-European currency wars will suppress, in unison with the ongoing 
recession/stagflation, international and European trade and, therefore, 
the US will dive into a new Great Recession. The postmodern 1930s that I 
keep speaking of will be a tragic reality.
In summary, this plan may end up being the only way out of a vessel 
heading for the rocks. We must keep it in mind given that our European 
leaders’ bloodymindedness has put, and keeps, a whole Continent on the 
rock-bound path. But it is not time yet to adopt it. For it will come at 
an incredible human cost; a cost that can still be averted (assuming 
that I am right in saying that the point of no return has not been 
reached – yet). We still have a chance to storm the bridge and change 
course. Failing that, a plan like that by Mosler and Pilkington may be 
the equivalent of our lifeboats. We should, however, always keep in mind 
that our lifeboats will be launched in icy seas and, while stranded on 
them, many will perish.
-- 
Namib
---
Cesó todo, y déjeme (Juan de la Cruz)
 
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 and the current Eurofutures swap contract)
 
and best economist on the whole planet earth according to great journalist...
....
DRUMBEAT....
.....
Paolo Barnard
 
AHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHAAHAHAHAHAHAHA

 Paolo Barnard
 
Non hai letto il testo, vero?


 Non hai letto il testo
 
cazzate del genere che "se si bloccano i conti, ci sarebbe un bank run"? Io sì, tu evidentemente no, altrimenti ti saresti reso conto di aver appena postato la dimostrazione del perchè Veroufakis sarà una sciagura per la Greica