European Pushback Against Bailouts

While the US markets are rockin’ and rollin’, I wanted to follow up a small NYTimes piece that might have slipped by unnoticed: Populist Advance in Finland Could Endanger Bailouts.

This seems to be the pattern. In nations where bankers and their creditors were allowed to go belly up, the populace seems to be more satisfied with the outcome, and the politicians are mostly managing to retain their jobs. Tiny Iceland seems to be the only country that got this right.

Ireland went the wrong way, but now seem to be having second thoughts. The UK went the wrong way, and then imposed austerity. The US not only went the wrong way, they made Congress a wholly owned subsidiary of the banking sector.

Now comes more signs that some of the Europeans are having further doubts: With 19% of the vote, the True Finn Party — highly skeptical of bailouts for countries like Greece, Ireland and, most pertinently, Portugal — are now odds-on favorites to become coalition partners:

“The True Finns ran on a platform that was hostile to the recent financial bailouts of Ireland, Greece and the agreement reached this month to aid Portugal. Those bailouts were meant to put an end to a sovereign debt crisis that has threatened the future of the single currency zone and raised questions about whether the disparate economies in Europe could ever be successfully integrated . . . their election gains came in the wake of advances by populist parties on the right across the European Union, including in the Netherlands, France and Sweden.”

Europeans are slowly figuring out they got royally screwed by bankers. Assuming bank debt, taking responsibility for bankers’ recklessness — is simply not in the public’s interest. I wonder when Americans will reach the same conclusion . . .


Forget Nationalizing: An Irish Renege on Bailouts? (March 31, 2011)

Advice to Irish: Prepackaged Bankruptcy for Banks (April 4, 2011)

Populist Advance in Finland Could Endanger Bailouts
NYT, April 18 2011

After the Bailouts, Cracks Are Showing
Richard Barley
WSJ, APRIL 19, 2011

Icelanders Reject Depositors Bill, Forcing Year-Long Fight
Omar R. Valdimarsson
Business Week April 11, 2011

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