Monday, August 22, 2011

EuroCrisis: Hocus Pocus--Focus!

Instead of relying on the unending stream of bad news to comment upon, I took some time to read some of the articles being written about the EuroCrisis.  I’m not sorry I did.

The EuroCrats are discussing solutions.  They are focusing on the unpopular solutions.  We used to believe that if medicine tasted bad, it was good for you.  Now we believe that the unpopular solution is always the best solution. 

The solution that no one likes is imposing sanctions on nations that do not improve their circumstances after receiving a bailout.

Your economy was in bad shape.  We gave you money to pay your national debts.  That was to help you while your economy improved.  Your economy did not improve.  Now we are going to punish you.  We are going to do this to help you. 

Some things require no additional comment.  The above paragraph is an example of that.

Another solution on the table is to create another layer of bureaucracy.  This is the toothless watchdog.  You feed the dog, walk the dog, listen to the dog bark, and blame the dog when your home is burgled.  My cat came up with that analogy.  Self-serving?  Yes.  Valid none-the-less.

The EuroNations currently staggering downhill economically do not need governance.  They need leadership.  Moreover, however, the leaders are in need of leadership.  All we have now is gratuitous management.

What has caused this flurry of activity?  I am embarrassed to say this.  Analysts.  Why am I embarrassed to say this?  I admittedly have only two skills.  An analytical mind and the ability to speak in metaphors.

Analysts are predicting the recession in Greece will continue.  They are basing their predictions on the fact that their assumptions failed to materialise.

Here is what happened.  The € 110 Billion Bailout to Greece was apparently predicated on the assumption that growth would return to Greece after some austere fiscal and economic changes.  When growth failed to arrive (Deus ex machina, I assume. Or Deus non machina for that matter.), the analysts predicted that the recession would continue.  Apparently, the Analysts never read Horace’s Ars Poetica.  Now, I never read it either. Still, here is the analogy.
Instead of putting 10% of your income into your retirement fund each year, I want you to put 5% of your income into your retirement fund each year.  This based on the assumption that your rate of return is going to double.

Instead of crunching the numbers, grasp the concept.

Thus far, there seems to be no solution.  There is no short-term solution to the problem.  There is no long-term solution to the problem.  What we do have, however, are steps being taken in the hopes that things will get better. 

This, we do, by calling the people trying to solve the problems, experts.

“Early to bed and early to rise, does not make you Ben Franklin.”—Slim Fairview

What is most startling about this situation is that there is little discussion about projects.  Cutting spending to the bone certainly gives the appearance of a better financial position.  It gives you the feeling of being in better financial shape.

You can also improve your circumstances by focusing on increasing the revenue.

Now, as I said elsewhere:

If you are unemployed, a government job is a job.

If you are an economist, a government job is a transfer payment.

However, we need a scapegoat.  There is, after all, a global economic crisis.  What happened?  Let’s blame it on John Maynard Keynes.  John Maynard Keynes may have as much to do with the problem as Maynard G. Krebs, but it will give us the opportunity to sell new ideas.

This in analogous to the decline in reading skills in the United States. 

With no evidence to suggest that Phonics caused the decline in reading scores, we began down the path of coming up with new and better ways to teach reading.  Each new way of teaching reading was embraced to solve the problem of declining test scores caused by the previous solution.  Ultimately, we blamed the test.  When that didn’t work, we began to demand testing the teacher.  The only ones who benefited were the ones who wrote and sold books explaining the new and better way of teaching youngsters to read.

The only people who got rich from Get Rich Quick books were the people who wrote them.  The only people who felt better from Self-Help Books were the people who made money writing them.

Thus it is with the EuroCrisis.  Everyone is in the same situation, it would seem.  Everyone has a solution.  The only people benefiting from the solutions, however, are the experts who make money selling their theories to the EuroCrats.

I once said in jest, “Put me in charge.  I can do just as bad a job, but I can come up with much better excuses.” Now I will say it not in jest.  "Put me in charge.  I can do just as bad a job, but I can come up with better excuses."

Let’s be honest, isn’t the feel-good course of action the one that helps us to show everyone that it was someone else’s fault.

Sincerest regards,


PS.  I am not Paul Harvey.  However, I am open to becoming a paid commentator, columnist, or blogger. If you’ve found anything I said to be helpful, please don’t hesitate to send me one of those tricked-out laptops and to tuck a few dollars into the envelope along with the thank you note.



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