Grexit

There is much speculation regarding a Greek default and its exit from the Euro currency.  Much of the rationale for keeping Greece in the system is of the kick the can down the road variety where contemplation of withdrawal is too hard to think about.  But its denouement is inevitable because too much money is owed so that servicing the debt sucks the life blood out of the Greek economy at a faster rate than it can make and replace it.  Uki Goni's editorial in the New York Times:  “What Greece Would Face in a Default” is correct in drawing the similarity to Argentina renunciation of its debt in 2001 to the country’s indifference to reality.  Greece joined the Euro currency on a fiction and it will have to leave on the fact that it can’t hack being part of a developed economy with costly government.

First lets recognize the inevitable.  The Greek economy can’t service its debt because it requires more resources than what it generates.  An economy depends on the circulation of money, an economic lifeblood that nourishes and oxygenates the organs that produce.  Greece is in a similar position as Germany after World War I when the Versailles Peace Treaty required it to pay huge war reparations.  These payments took the lifeblood out of Germany’s economy which created the economic instability of the Weimar Republic and finally the metastasises to Hitler and Nazism. Greece is loaned money by the EU so that the money and more is taken to service debt.  Austerity makes the problem worse by reducing economic activity which reduces income and finally the ability to repay.   Its not logical that they stay in such a loss position and the longer they do the more radicalised the country becomes.

Greece and Argentina are countries that deny economic reality.  Various articles about Greece in the New York Times over years bring up a very meddlesome government hindering economic activity.  One article from memory recounted the travails of a Greek American trying to start a beer company in Greece only to be held back by a government bureaucrat beholden to Heineken beer of Holland.  Another article detailed an online Olive Oil start up with company executives required to submit stool samples to a Greek Health bureaucracy in order to sell third party oil never touched by any of these executives.  And finally a railroad built because money was made available by the EU but with no market demand.  The final determination of the project was that billions would have been saved if the government had just subsidized the taxi ride of the few riders using it.  These are decisions of a non-market entity, government, making wasteful asset allocations that are difficult to recover from even given a bountiful economic environment. Greece can’t afford a large meddlesome government similar to what prevails in the more developed regions of the European Community.

As long as Greece is part of the EU and its currency the meddlesome large government bureaucracy exists.  Until a default there is no possibility of a dis assembly of this uneconomic structure so that it can rebuild logically in a marketable manner.  There is no guarantee that it will.  Its likely course would be the same myopic one as Argentina with dismal result but there is always hope that it will not go there.  Currently without a default there is absolutely no hope.

Justice is Achieved when In-Justice is Absent

Its from Frederic Bastiat The Law 1850 and is part of my curriculum at Cato University.

My Congressman Jim Himes

Held a meeting yesterday at Norwalk Community College regarding the framework for a nuclear deal with Iran.  While the gathering was ostensibly to get local public reaction to the negotiations I was pleasantly surprised by his lucid presentation of his position on the matter.  I feel comfortable with his representation.

Poor Mixed Up County Magistrate John G. Kallan of North Carolina

Options Few for Opponents on Marriages shows a very forlorn John G. Kallan who decided to step down rather than conduct same sex marriages.  I can't understand his position when he acts in a government official's capacity to issue a marriage certificate so that a couple enjoys legal rights afforded to them.  On the other hand Mr. Kallam's pastor the Reverend Steven Griffith of the Osborne Baptist Church in Eden, North Carolina is completely in his right not to perform same sex marriage ceremonies which sanctify the union religiously.

Rhetorically Slick but Substansively Weak

Cruz Shows Eloquence and Limits as Debater describes Ted Cruz's ability to argue any point pro or con at a moment's notice.  Its not a positive political characteristic.

Spontaneous Order

Reading David Boaz The Libertarian Mind and found the term I have been searching for.  Adam "Smith's contribution to Libertarian theory was to develop the idea of spontaneous order."

July 25th note from Cato University:

It turns out "Spontaneous Order" comes from Friedrich Hayek.

No Progress in Syria

My Post of February 28th:
Because Syria does not have a prosperous, and therefore moderate, Sunni political union it requires that the allies build one from scratch before thinking of funding rebel groups to counter ISIS and Assad. The U.N. Syrian refugee hunger aid program is a non partisan vehicle of distribution of funds with a debit card process that lets families decide for themselves what goods and services to buy.  Allied policy should be to make the Syrian refugee camps in Northwestern Jordan attractive to those desirous of peace and prosperity so that they gravitate to South Syria.  Providing this sanctuary also alleviates the desperate migration of Syrians to Europe and other countries.  The benefit of direct distribution of funds to consumers is its moderating effect which forms a market economy within the camps so they self organize governing bodies that secures the people and adjudicates fairly.  Camps could organize along ethnic lines of the various sects of Islam and Christianity which eventually federalize into a moderate political union.  Generous aid to Jordan creates an infrastructure to service the refugees and eventually construct city states across the border in the South of Syria; cities protected from Assad’s helicopters with American and Jordanian air power, by the way a much better use of Jordan’s air power where Sunni’s are supported rather than innocents killed as in its current lashing out in reprisal to ISIS’s immolation of a Jordanian pilot.  The Syrian city states swell as they accept more and more refugees so as to expand northward.  The disaffected Sunnis of Damascus vacate and force Assad to retreat with his Alawite Shia tribe to Syria’s western shore.  Over time moderate governance would expand northward displacing ISIS’s from hollowed out cities in Syria and possibly in Iraq as well.  Generous aid sounds as if it would be costly but it is certain to be one tenth the cost of funding the carrier fleet in the Eastern Mediterranean for example,  and with a much more productive result in pacifying the region.

Apparently no one of influence sees the need to make a pacifying zone in southern Syria along the Jordanian border that invites Syrian refugees to come and develop communities and political unions that can displace Syria's dysfunctional political regions. So instead of real progress in Syria we just have a growing problem in Europe, Turkey and North America as reported in Tide of Refugees, But the West Isn't Welcoming.

Three-way Tug of War

Tensions Flare Between Allies in U.S. Coalition, duhhhhhhh.  Its a Shia Sunni civil war and the U.S. is trying to get good behaviour out of irrational players.  Stop it!  Let Iraq and Syria separate into its factious regions and fund with humanitarian aid to with those with political unions that serve its people and leave the rest alone.

Marco Rubio?

Marco Rubio is a younger version of Jeb Bush.  He over-thinks just like Jimmy Carter did.

Rules to Disaster versus Insisting on Skin in the Game

Rules Aims to Prevent Offshore Rig Disasters is a reaction to the "Deepwater Horizon" rig explosion of 2010 which begs the question what rule was missing that would have prevented the rig's manager from short cutting safety to meet a schedule?  Currently it's the loss of $50 Billion of BP's shareholder value that prevents BP and other Major Oil Companies from risking disaster.  The article doesn't mention whether the $75 million liability cap on offshore drilling companies is still in place but if it is then good luck trying to get a really limited LLC to clean up a mess similar to BP"s rig explosion.

The Baker in Colorado

The Baker in Colorado video makes clear that some businesses are an art form.  I support this baker's decision to avoid expressing himself in a manner contrary to his beliefs.  It would be Authoritarian to force him.

The Heavy Hand of Government

Lets not have the heavy hand of government keep people from exercising their religious belief is a paraphrase of what Governor Bobby Jindal expressed today on “Meet the Press.”  It’s ironic then that Louisiana has a Religious Freedom Restoration bill in the legislature trying to work out the specifics.  Why bother writing the RFR that will ultimately get watered down and duplicate the federal version? Attitudes are changing at a different pace in various locals, slower in rural than in metropolitan areas, so any law setting specifics is behind or ahead of the issue.  Let it resolve itself in the various communities at their pace and not dictate the same result in New Orleans where LGBT’s celebrate openly while in rural areas there is no willingness to celebrate openly nor desire to force participation.  As attitudes change and rural America catches up good people will express themselves without the heavy hand of government.

April 23rd Bobby Jindal Editorial in the New York Times Holding Firm Against Gay Marriage appears to favor the Heavy Hand of Government.

Arkansas too?

Listening to Jim Dotson, at least I believe it to be him since he said he was the Arkansas State Legislator from the district that includes Bentonville, Walmart's headquarters, on NPR who struck me as being clueless about mass distribution businesses that can't personally interact with their customers.