Spanish public debt reaches 77.4% of GDP

By LUIS MIRANDA | THE REAL AGENDA | DECEMBER 14, 2012

Government debt in Spain grew another 1.55% in the third quarter with respect to the second quarter to reach 817.164 million euros, or the equivalent to 77.4% of GDP. This is the highest level ever since the cork popped out of the crisis bottle in 2008.

According to data released by the Bank of Spain, the rise is a result of the increased debt of the central government, which has added 2.24% more to the total reached before this quarter, 695.519 million euros, and that represented 65.9% of the gross domestic product (GDP).

Meanwhile, state government debt declined by 0.48% to 167,460 million euros, or the equivalent to 15.9% of GDP, while the debt of municipalities fell 2.65%, to 43.802 million euros, which is equal to 4.1% of GDP.

Along with the release of data for the third quarter, the Bank of Spain has also updated the second to include the impact of the debt payment plan to Spanish lenders, although the changes do not affect the total amount.

Thus, at the end of the second quarter sovereign debt had grown by 14.9%, placing the burden of debt on GDP at 15.9%, the highest in history and two points over the previous quarter.

Additionally, local businesses increased their debt by 22% in the second quarter, raising the ceiling to 4.3% of its debt to GDP margin, a level that had not been seen before. When it comes to autonomous communities, Catalonia is the most indebted in absolute terms, with 45.754 million euros of debt at the end of the third quarter, followed by Valencia with 25,574,000 million and Andalusia with 18,495,000 million.

In relative terms, Castilla-La Mancha ranks first as an indebted community, with a debt equivalent to 5.7% of GDP, and is followed by Valencia (25%), Catalonia (23%) and Baleares (20.3 %). At the end of the third quarter, public companies owed 55.973 million euros or 5.3% of GDP, which means 0.81% more than in the previous quarter.

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The Immorality Crisis not lack of Transparency caused the Financial Collapse

By LUIS MIRANDA | THE REAL AGENDA | DECEMBER 5, 2012

The European Union countries most affected by the global economic and financial collapse are also some of the most corrupt. But the highest levels of immorality and corruption are not seen at the national level, but on the international stage.

A recent publication by Transparency International which assesses the perception of corruption through a well established index, calls the results ”disappointing” in the sense that countries, especially those hit the hardest by the current financial collapse, are corrupt at heart, indeed.

The Index 2012 Corruption Perceptions from Transparency International shows that Greece obtained the worst result of all the European Union with a score of 36 out of 100, in 94th place out of 174 countries in the table. The Hellenic country is below Bulgaria and Romania.

Among the members of the European Union, Spain is in 13th place, after Denmark, Finland, Sweden, the Netherlands, Luxembourg, Germany, Belgium, UK, France, Austria, Ireland and Cyprus. The report from TI shows the stagnation of Spain, the second country in Europe on its way down the cliff. Spain shares the 30th position with Botswana in the latest report of the corruption index.

“Among the countries hardest hit by the crisis are Italy and Greece — both join Spain on their way to total collapse — as corruption in the public sector is a major problem,” said Corbus de Swardt, spokesman for the NGO. He then added that ”the fight against corruption is one of the keys so that Greece can emerge from the crisis. True point, although the type of corruption that pulled Greece down to the abyss, did not necessarily originate inside the  country. As it happens in most nations, the bureaucrats who manage the destiny of countries and their people are front men and women whose work is to be ‘YES MEN’ and who represent the interests of the European oligarchy; where the highest levels of corruption emanate from.

In Germany and France, De Swardt believes that “one of the main problems is the relationship between politics and business.” The report reveals the existence of interest groups and a culture of secrecy. He is particularly concerned about the funding of political parties in Germany. Interest groups of course are not limited to women’s rights groups or unions, but to large conglomerates of companies that operate locally and outside the countries and who dictate the policies that the governments follow.

At a press conference Wednesday in Madrid, the President of Transparency International Spain, Jesús Lizcano, innocently advocated for giving good training to staff. He also called for issuing punishments to institutions that do not comply with transparency.

In this context, Antonio Garrigues Walker, executive committee member of IT, reminded people that in the past 18 years, corruption has increased gradually but forcefully mainly because, he said, that most countries do not have transparency laws in place. But reality shows otherwise. Countries with significant rules and regulations about transparency also suffer the consequences of corruption mainly because the rules on transparency are written for the people, not for the corrupt politicians in government and the corporations, who always manage to find back doors and legal windows to get away with cheating the system. Therefore, the crisis is not one of corruption, but of morality. Corruption is just the direct result of a society whose morality has been removed.

“Transparency is an absolute obligation of institutions and an absolute right of citizenship,” said the lawyer, who also lamented that countries like Spain have a civil society that is “weak and dependent.” In his opinion, corruption is “a true leukemia” especially in the economic system and transparency is the instrument to combat it.”

The agreement among most of the attendees is the ”truly alarming” intensification of corruption worldwide. The highest levels of corruption speakers said have been seen during the current global financial collapse caused by the corrupt financial system upon which the world functions and which is managed by a few powerful elites.

Since the first Corruption Perceptions Index was published in 1995, both Anglo-Saxon and Scandinavian countries remain at the top of the corruption ladder, even though the index does not always shows it. That is not a surprise as many of the oligopolies that are the source of corruption are established there. Outside Europe, countries such as Afghanistan, North Korea and Somalia are three of the most corrupt in the world.

Although the Transparency International Index is just a main stream kind of thermometer which superficially gauges the levels of corruption around the world, it is a good starting point. Its results however contrasts with the reality of corruption and transparency. It is important to remember that in the case of the TI Index, it only reports the “perception” of corruption and not the real, factual levels in a country. That is why in its 2012 edition, countries like the United States, Uruguay and Germany hold distinctive positions, despite the fact these countries are submerged deeply into a sea of corruption. Another caveat is that the TI Index only includes the perception of corruption in the public sector and leaves out its twin out-of-control unregulated corporations.

Do we need a global index to know how bad corruption is in a determined country? Not likely. A more faithful gauge would be an honest look around the city and country where we live.

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Portugal Approves Polemic Budget Amid Massive Public Protests

By LUIS MIRANDA | THE REAL AGENDA | NOVEMBER 27, 2012

If anyone wants to understand how much disregard governments have for their people, it will suffice to look at Portugal. The country is one of the European nations in worse condition, which caused massive public protests on the streets of the capital Lisbon as well as other cities. Despite the protests and the Portuguese government approved an ever more austere budget after 224 members of Congress discussed and voted for it.

Meanwhile, outside the Congressional building, thousands of people called by the unions and various civic associations, screamed and protested peacefully against the same budget in a desperate attempt to stop it, or at least to voice their anger. Eventually, enough votes from the coalition government conservative CDS-PP PSD decided to approve the text. All opposition (Socialist Party Portuguese, Portuguese Communist Party, the Left Bloc and the Greens) spoke against it.

The multitude of protestors included unionists, housewives, unemployed, students and others. One of these protesters carried a banner with a simple and powerful message: “Get me out of this film.” In one corner, a young man seemed to use a cardboard stand to solicit that people signed his petition against the upcoming move to privatize the water supply.

Everyone is convinced that the newly approved budget is going to make life worse yet some more. It’s true. The text includes, among other measures, a brutal tax increase described by the opposition as a genuine “tax bomb” aimed at wiping the government’s debt and to achieve the goals imposed by Portugal’s new owners, the Troika. The Government argues that a budget is conditional and that its scope to develop another one is very low given the need to adjust spending to meet its commitments.

The cuts are affecting many and especially the Portuguese salaried middle classes, which already carry the enormous weight of the economic downturn in a country that was ‘rescued’ in April 2011 to avoid bankruptcy.

So, starting next year, several sections are taken out from Portuguese Income Tax to raise more revenue in addition to a 3.5% general tax on everyone that will start in January. The hardest hit groups under this new tax scheme are retired people, those who receive unemployment benefits and others who get government subsidies for health benefits. In general, higher taxes, fees and surcharges will all increase for the  Portuguese population and such increases will equal a complete full salary. Government workers and those who are retired will continue to live without their yearly bonuses paid to them once a year, but that was cancelled by the government a year ago.

Indeed, 2013 will be much tougher for the Portuguese people. The economy, according to the government, will fall by 1%, consumption will drop by 2.5% and unemployment will climb to 16.8%. There will be cuts, yet without specifying if they will reach Health and Education. Everything will work a little worse. It is expected that the country achieves a tiny sign of a recovery in 2014, if anything at all, said today the Finance Minister Vitor Gaspar.

The problem is that last year, Gaspar said the same thing referring to 2013, which has made it less likely that people and experts believe what Gaspar says.

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Greek government imposes more Austerity

By LUIS MIRANDA | THE REAL AGENDA | NOVEMBER 8, 2012

The same worn out ineffective policies that have done nothing to help Greece come out of the dire situation it has been for years have found more support at the highest levels of the Greek government. Congress in that country had the guts to adopt more of the same hunger causing measures that took Greece from being in a bad recession to a complete and open economic depression.

The Greek government managed to give new impetus to the austerity policies demanded by the EU and the International Monetary Fund but that were again rejected on the streets and partially in Parliament, where the new austerity measures were approved with a very small majority. For Greece, however, this late awakening by some of its congressional leaders, may be too little, too late.

On Wednesday the Greek Parliament approved the latest round of austerity measures with 153 votes in favor, 128 against and 18 abstentions. One congressman was absent during the voting.

The so-called coalition government led by banker accomplice and Prime Minister Andonis Samaras, gained control of 175 of the 300 seats in Congress which facilitated the approval of the measures, despite the last-minute challenges issued by some opposition leaders.

The new austerity package includes, among other goodies, the dismissal of about 25,000 government employees by the end of 2013, reduced pensions and health co-payment.

“We voted to remain within Europe or return to the drachma, international isolation, social insurrection and civil war,” Samaras said in Parliament during the debate period previous to the approval of the list of demands written by bankers in Brussels.

“Some of the measures included in the bill that we voted today should have been adopted years ago. Others, such as wage and pension cuts are unfair and that is something we should not hide,” confessed Samaras. During the debate, which was hoarse and thick with shouts and interruptions, the opposition branded the new austerity package as “unconstitutional” in both its content and the procedure for approval.

As in many other countries, the artificial sense of emergency, gave Congress little or no time to actually read the 279 pages of the proposal that did not get to Parliament until late Monday. The same has been done in countries like the United States, when George W. Bush and the American Congress approved the TARP legislation and when they decided to bailout banks and General Motors.

Congressman Dimitris Papadimulis, warned after the vote that the new measures “will hurt seriously the Greek society and the economy” and called on the population to “prevent it” fighting against a government which he said had experienced significant losses. The rejection of the new austerity measures, both before and after the approval was clearly felt on the streets of Athens, as people participated of a general strike of 48 hours.

Before the vote was taken, anywhere between 100,000 and 200,000 people showed up to Syntagma Square, just outside Congress to demand the rejection of the legislation. Although the protests remained largely peaceful, the approval of more austerity resulted in riots between protesters and police. The disturbances spread along the avenues and squares nearby, where protesters resorted to burning garbage containers and destroy barricades placed along the streets.

Police actions against the protesters rendered at least 70 people arrested. Most of the Greeks who tried to put some pressure on Congress to reject the new austerity policies remained outside Parliament premises while they shouted and demanded that their voice be heard. As in all other occasions, the Greek leadership did exactly the opposite; they listened to the bankers and not their people.

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Greece ‘unlikes’ freedom of the press

Journalist arrested for disclosing a list of tax evaders

By LUIS MIRANDA | THE REAL AGENDA | OCTOBER 29, 2012

Investigative journalist Kostas Vaxevanis will go on trial for publishing the so-called ’Lagarde list’, which contains the names of 2,059 Greek people with bank accounts in Switzerland. The document, whose authenticity the government in Athens refuses to confirm, includes at least three politicians, two of them from the New Democracy, the party of Prime Minister Andonis Samaras. These people have accounts at the HSBC bank. The journalist appears Monday in court accused of publishing confidential data.

Vaxevanis was arrested Sunday morning at a friend’s house in Athens, amid a security deployment that he called a “fascist militia” in one of his Twitter messages. This Saturday, Hot Doc, who runs the fortnightly magazine where Vaxevanis made the documents public, ran the headline “All the names of the Lagarde list”.

The story is not new. In autumn 2010, six months after the first bailout of Greece, the then French Finance Minister, Christine Lagarde, gave his Greek counterpart, George Papaconstantinou, a list of 2059 names of Greek citizens with accounts in Switzerland as documentary evidence of the inveterate habit of evading taxes by professionals and entrepreneurs in Greece.

The fight against tax fraud was one of the flags of the socialist government of George Papandreou, along with a clamorous demand from international lenders, the troika form by the European Commission, the European Central Bank and the International Monetary Fund (the latter currently headed by Lagarde).

But the ‘Lagarde list’ apparently fell into oblivion and did not surface until earlier this month when Papaconstantinou’s successor as head of the Ministry of Economy and now leader of a party adrift, the socialist Evánguelos Venizelos, surrendered the list to authorities. Both declared that they had no information on the whereabouts of the list, but gave conflicting testimonies, said journalist Michalis Samozraki a Hot Doc hournalist during a phone conversation.

“In recent months there has been much controversy over the matter. Papaconstantinou and Venizelos were summoned by a special parliamentary committee, but told a different story from their previous one, that they had no knowledge about the existence of the ’Lagarde list’; while later, they said they could not publish it because it was confidential … They used this as an excuse. But the Greeks began to feel cheated. That is why the fact that his colleague was arrested for publishing the list, is seen by Samozraki as an “act of total censorship. “

Sources say the magazine received a copy of the ‘Lagarde list’ anonymously and Vaxevanis himself vindicated his obligation to disclose it, despite the threat of legal action: “I have done nothing but what a journalist is obliged to do: reveal some hidden truth “, says in a video sent to Reuters. “If anyone should be prosecuted, those are ministers who hid the list, the ‘lost’ list that they said it didn’t exist. I just did my job. I am a journalist and that’s my job. “

In the list published by Hot Doc there are the names of at least three politicians, including two former ministers of New Democracy, one of them is dead, and a current is a director for Samaras. The former Minister Giorgos Voulgarakis denied having money in Switzerland, despite being on the list.

The potential arrest of Vaxevanis was known since Saturday after it was issued by a Greek prosecutor. Vaxevanis has under his belt investigations that include the scandal known as  the Vatopedi case — one of the largest corruption scandals in the last five years and also collaborates as a journalist on the website Koutipandoras.gr (Pandora’s Box). “They entered the house with a prosecutor,” said Vaxevanis on his Twitter account. ”They are detaining me. Please spread the word.” Pictures of the outside of the building where he was showed a large police operation which included a strong checkpoint.

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