EUROPE: HOW LONG WILL SHOCK THERAPY WORK?
VENICE, Italy, July 15, 2011 â€“ In an abstract way Italyâ€™s economic troubles are a stand-off
between international speculators hollowing out Europeâ€™s economies one by one and a
public no longer willing to see their countryâ€™s â€˜privatizedâ€™ public assets and
services snapped up by foreign investors buying well below real value.
The saga began with the results of a referendum on June 14 this year when
Italians, not always the wisest in choosing their leaders but sometimes endowed with great
foresight, voted a resounding â€˜noâ€™ to their governmentâ€™s intention to introduce
nuclear energy and privatize public services. Few noticed that only three days later Moodyâ
€™s Investor Service and Standard and Poor, the self-appointed arbitrators of a nationâ
€™s economic standing, warned international investors that Italyâ€™s debt was heading
the way of Greece, Spain and Portugal as well as Ireland (whose bonds the agency now
The aim of this warning was obvious. By pointing the finger at Italy as the next
victim in Europe, Moody and its associates hoped to send a strong message to the rest of
European nations which, perhaps with the exception of Germany, struggle with the same
deficits and debts as Rome. The message was simple: â€œTake note. If you donâ€™t
embrace privatization and budget cuts as recommended you too can be targeted, just like
With its stagnant government, its political inertia and its ballooning deficit, Italy
was vulnerable to â€˜attack.â€™ Yet the irony is this: Italy and the rest of European
countries have been happily running deficits for the last two decades. So why this sudden
demand to balance their books in a global economy based, so it seems, on virtual trust and
confidence easily manipulated?
The Italian referendum results, combined with the protests in Greece and Spain,
apparently jolted the cabal of American and international investors who, no longer able to
reap huge profits from developing countries, have turned their game on the developed
world, picking off the weakest of the European nations in an EU whose strong Euro
currency has been replacing the US dollar.
(Strangely enough Moody and its associates have so far failed to downgrade the
United States, whose national debt is monstrous and the worldâ€™s largest or Britain
which has an equally bad debt record)
Italy, run by a coalition of bunglers and boasters, the BBs, was an easier target.
Italy is the third largest economy in Europe shackled to a 1.8 trillion Euro debt run for years
like a private fiefdom by media tycoon Silvio Berlusconi who has become increasingly
unpopular but can still buy the votes of parliamentarians. He must hang on to power at any
cost to stave off a score of trials, ranging from bribing a judge to having sex with a minor.
Berlusconiâ€™s coalition was badly buffeted by the June plebiscite which was a de facto
vote of confidence the government badly lost.
Enter the cabal. As usual it disguised all demands as free market economics
though the stipulations are obviously tailored to make vast profits - at the cost of making
the victim poor. The prerequisites for this profit-making formula is presented to the targeted
nation by a consortium of European banks and financial committees who inevitably
prescribe the same antidote against bankruptcy: Dramatic budget cuts, salary cuts,
pension cuts, employment cuts, the sale of government bonds below current prices but
most of all privatization not only of public services like electricity, public transport, health
and water but public assets like palaces, parks, waterways and anything else the sharks of
the free market economy may deem worthwhile to possess, exploit or eventually resell at
vast profits â€“ in short a free hand to ransack anything of value at knock-down prices.
Ironically, as in the United States, these â€˜officialâ€™ condition-makers
come to their posts in government (or the European Union) from the private finance
industry - which they continue to represent indirectly - and to foster. It is these lackeys of
the cabals who present â€˜what you must doâ€™ to targeted nations.
Today Italyâ€™s Berlusconi-led coalition has the tricky task to pacify the
cabal by acceding to its demands. Yet at the same time the government is handicapped by
a referendum that makes it unconstitutional to privatise public assets and services until
As ministers and legal advisers scramble to find ways to wriggle around the
plebiscite the real issue emerging in Europe is the publicâ€™s right to enjoy what belongs
to all and the public services it pays for in taxes. For decades these services and assets
have been expropriated or slyly sold off by unscrupulous politicians to finance their own
greed or cover corruption and mismanagement.
It was, after all, an Italian political philosopher, Antonio Negri, whose book â
€œCommonwealthâ€™ warned that capitalism, in its last gasp, would rob the public of
what belongs to all, starting with intellectual copyright, patented seeds and human genes.
And it was Naomi Kline with her book â€˜Shock Therapyâ€™ who pointed to the
methodology of the cabal in forcing countries to bow to its will with the same scare tactics
of financial meltdown now being practiced in Europe. (At political level governments use
the scare of â€˜terrorismâ€™ to justify war expenditures and new laws).
In an Italy run for years by rogues, philanderers, liars and politicians more
famous for their stupidity than their creativity the common peoplesâ€™ battle to save what
belongs to all has just begun.
Uli Schmetzer was foreign correspondent for Reuters and the Chicago Tribune for nearly
40 years. He is the author of â€˜Times of Terrorâ€™ â€˜Gazaâ€™ and â€˜The Chinese
Juggernautâ€™ all available on www.amazon.com