> A new currency issued by an indebted country exiting the euro, for > example, would likely suffer an immediate drop in value. But euro > denominated debts would still need to be serviced in euros but now > purchased by a non-euro currency. Rating agencies would likely further > downgrade the credit rating and the financial crisis would be > exacerbated.
Elmar concludes his 2012 Social Register essay: "If the eurozone is to have a decent future (to the extent that this can be achieved under capitalist conditions), it is a very new type of 'European statehood' that needs to evolve from the market-oriented one that its establishment proponents have always envisaged. Interventionist policies have to work towards reducing the real economic divergences that exist within the eourozone and the genuine construction this time of a social Europe. This goes beyond making the case that the European Union must become a 'transfer union', although we can see that even in Trichet's technocratic neoliberalism, the necissity for more fiscal cooperation is seen as irrefutable. It is a ridiculous by-product of the neoliberal warship of the market that the most unqualified, politically undemocratic and economic inefficient institutions in the form of the debt rating agencies sit in judgement on the creditworthiness of countries, on the quality of democratically elected governments and on the value of the currency. These monsters of the neoliberal financial market are more powerful than a state like Greece, with more than two thousand years of history and a population of more than 10 million. This intolerated state of affairs has to be changed." Replace Trichet with Draghi - and you have a very good brief comment on what is at stake today in Athens, Brussels, Berlin, and Frankfurt. By the way, Elmar is among the first sigatories of the following appeals: Change Greece – Change Europe – Change4all http://www.with-the-greeks.eu/ initial sigatories http://www.with-the-greeks.eu/initial-signers/ Greece after the election – not a threat but an opportunity for Europe http://wp.europa-neu-begruenden.de/griechenland-chance-fuer-europa/greece-after-the-election-not-a-threat-but-an-opportunity-for-europe/ initial sigatories http://wp.europa-neu-begruenden.de/griechenland-chance-fuer-europa/erstunterzeichnende/ Feel free to sign the petitions as well. Interestingly, in the Socialist Register's 2012 issue Altvater's article is followed by an article representing the contrary position, written by Costas Lapavitsas "Default and Exit from the Eurozoe - a radical left strategy", where he states: "Exit is an important component of a radical left strategy that could deal with austerity while restructuring economies in the interest of labour" (p. 295), and so on. Louis Proyect wrote: > > Socialist Register 2012 (behind a paywall) > > ELMAR ALTVATER, FROM SUBPRIME FARCE TO GREEK TRAGEDY: THE CRISIS > DYNAMICS OF FINANCIALLY DRIVEN CAPITALISM > > Conservative and neoliberal economists and politicians are toying with > the idea of splitting the monetary union into two or even more groups, > into a Europe of ‘different velocities’. A core Europe of Germany, > France and a few other countries would continue using the euro (or a > common currency with another name), while a European periphery might > have Greece reintroduce the drachma, Italy the lira, Portugal the > escudo, and so forth. > > There are also Left positions that point in this direction. In these > views, exit from the euro creates new space for political action; better > national conditions for overcoming the crisis can be enforced; and a > break from the neoliberal integration project becomes possible.28 But > what is likely to happen if the eurozone fails?29 Unlike the 1970s, > today we are dealing not merely with the equivalent of the > disintegration of the Bretton Woods regime of fixed exchange rates into > its component parts of national currencies with flexible exchange rates. > Instead, this would be a collapse of an actual monetary union that has > existed for nearly two decades. The component parts – national > currencies – would have to be reinvented. As conditions within the > eurozone vary widely, this process would be extremely controversial, not > the least because the ‘old’ economies existing within the borders of the > nation-state do not exist anymore. Sovereign territories as spaces of > regulation are no longer consistent with the reach of transnational > corporations or of financial speculators. > > A new currency issued by an indebted country exiting the euro, for > example, would likely suffer an immediate drop in value. But euro > denominated debts would still need to be serviced in euros but now > purchased by a non-euro currency. Rating agencies would likely further > downgrade the credit rating and the financial crisis would be > exacerbated. While the devaluation allowed by a non-euro currency would > increase monetary competitiveness, this advantage is limited if real > competitiveness does not increase as well. Many of the indebted European > countries lack the relevant export industries. On the other side, the > remaining eurozone will likely undergo currency appreciation. This > revaluation would limit the competitiveness of industrial capital and > further encourage financial capital to speculate on the euro. The > ‘equilibrium’ that would result across Europe, after such a period of > economic turbulence, is impossible to predict. > _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
