What actually happened in Cyprus?

What happened?   It's hard to say.  One big bank saved, one on its way to dissolution.  The smaller banks, it seems, will be left to their own devices.  Did the Teutons get their way?  Partly.  Are the Cypriots actually saved?  Not likely.  Greek style depression looks inevitable

Here's the good stuff: the insured deposits remain insured.  Those with up to €100,000 will not suffer losses, but those with larger (some very much larger) accounts will take a hit.  The Russians, needless to say, are not happy.  Amusingly enough, they are talking about starting their own bank, someplace in Asia, where they can avoid paying (presumably Russian) taxes.

What we never hear, though, are what (if any) consequences accrue to the bankers who created the mess, and the bureaucrats who facilitated their activities.  Is it cynical of me to think they might have kept their own wealth someplace other than Cyprus — someplace where the banks were not gambling on long shots like Greek bonds?

Eric Holder seems to believe that American bankers are "too big to jail," and hasn't pursued any prosecutions for malfeasance — but somehow, someplace in the world, I'd like to see some bankers behind bars.

Compromises

The chained consumer price index, as a measure of inflation, makes a certain amount of sense.  It certainly is true that consumers will substitute cheaper goods for more expensive goods when prices increase.  Old people like me, whose Social Security payments are not the greatest part of our income, can cut back from shell steak to pork tenderloin; or from 85% lean chopped meat to 70% lean chopped meat; or from fresh asparagus to canned string beans.

The substitution effect makes sense, up to a point.  If you're already eating cat food as your primary source of protein, what in hell do you substitute?  People actually trying to live on Social Security cannot survive a chained consumer price index.

If Social Security were means tested, I could survive it — but if it were means tested, Social Security would be eroded down to nothing.  Nobody really gives a shit about the people who depend on it for their survival.  The most important thing about Social Security is that everybody gets it, so even rich people get it (and generally more than poor people do.)

So, if a "grand bargain" comes about, and it includes a chained consumer price index, you should be aware that Obama has sold you out to the fucking plutocrats.  Okay, he's looking for a deal.  I don't care.  We don't need a grand bargain.  We need justice.

Yay, Cyprus!

How very nice that the Cypriot Parliament decided that abdicating the guarantee on deposits under €100,000 was unacceptable.  Take that, fucking Angela, and if you have political problems with your anal retentive base, that's your problem.

Stop and think about it.  One of the greatest contributions of the Roosevelt administration was the FDIC, the government guarantee of deposits into saving and checking accounts.  Europe emulated the Roosevelt initiative, and banks suddenly felt a hell of a lot safer.

The German recommendation for how to bail out Cyprus strips away that depositor confidence.  I can't be any happier that the Cypriot Parliament told the Germans to go fuck themselves.

Short Subjects for March

CPAC
 This year's Conservative Political Action Conference teaches us an important lesson: we no longer can contrast crazy wack job Republicans with "mainstream" Republicans.  The crazy wack jobs are the mainstream of the party.  Despite the straw poll they took, I don't anticipate Rand Paul getting the presidential nomination for 2016, because he can't have made the military contractors too happy.  Ted Cruz, on the other hand...

Francis
Unlike his predecessor, Pope Francis actually seems to show some human characteristics.  It's a nice change, I suppose, from Benedict, and it's nice that Francis seems to be concerned about the poor.  Still, I wonder if he has the administrative skills to clean up the Curia and the Vatican Bank.  Well, Jesuits often are pretty sharp — so, maybe.  Women, though, will have to wait for the next Pope or, more likely, the next century.

Bradley Manning
The Obama administration's pursuit of "aiding the enemy" charges against Bradley Manning is unconscionable.  How far we have descended from the era of Daniel Ellsberg and the Pentagon papers!  The Obamists pursue whistle blowers with the same vehemence they pursue undocumented aliens — and in both cases, that's a great deal harder than W ever did.  If Obama sometimes looks like a liberal, it's only by comparison with contemporary wack job Republicans.

Cyprus
There probably is enough loose change under the couch cushions of European plutocrats to bail out Cypriot banks, but most of that money would be going to Russian oligarchs using Cyprus to launder money obtained in ways that might not be exactly legitimate.  I'd suggest dropping the insurance level on deposits to, say, €50,000 and just letting them fail.  Would it shake up the Eurozone?  Uh huh.  Would it be catastrophic? Maybe, but the Euro was a catastrophe from day one.

Smoke Signals

Why is there so much interest in the next Pope?  Every single Cardinal in the Conclave was appointed either by John Paul or Benedict, so every single one of them is a conservative.  Since they are the candidates as well as the electors, it's inevitable that the next Pope will be a conservative.  European, Latino, North American, or African, it won't make a damned bit of difference in the theological (hence, social) direction of the Church.

No, we're not likely to see anybody like John XXIII again, just in case any of you might be old enough to remember him.  There won't be any liberation theology — that's for sure!  The Church will remain ossified, secretive, and determinedly anti-woman.  Will the occasional boy diddler be outed and prosecuted?  Probably, but only at the lowest levels.  Will there be any structural changes at the Vatican Bank?  Doubtful.

What the Cardinals have to be thinking about most right now is damage control.  They don't dare to elect a Pope who might support married priests, much less female priests.  Even though "Papal infallibility" only dates back to the 19th century, they don't want to mess with it.  It's nice to be infallible, especially when you're wrong.

Adiós, Hugo

Hugo Chávez was not, by any means, perfect, but his care for the poor was at least as powerful as that of any modern leader.   Okay, his ego was more than a little outsized, which led him to make decisions about matters in which he had no particular expertise.  Venezuela's economy is a mess.  Inflation is crazy, the oil industry is thoroughly mismanaged, and crime is encouraging those who can afford it to join the other wealthy Latino bourgeoisie in South Florida.

Hopefully, Nicolás Maduro — or anybody else who eventually succeeds Chávez — will have the good sense to bring in some technocrats to do some problem solving, and not try to make every decision himself.  Personally, I think the Bolivarian Socialist model can succeed, but not run as a one-man show.

More on sequestration, yawn...

Senate minority leader Mitch McConnell, who never fails to remind me of an elderly Foghorn Leghorn, has been crowing for a couple of days now.  Like a lot of other roosters, he doesn't restrict his crowing to the early morning hours, but keeps up the noise all day long.

Most recently, he's been going on about how how the sequester is no big deal, because it's just a tiny slice of the federal budget.  Yes, too bad it's kind of haphazard, but what the hell.  Budget's gotta be cut, ya know!

Personally, I don't at all mind the cuts to Defense although I feel sympathy for the people who might lose their jobs with defense contractors if the sequester goes on long enough.  The Department of Defense (they really should go back to calling it the Department of War) enters into contracts that typically last for years, and no existing contracts will be cancelled — not even for the most useless weapons systems the military doesn't even want.

Foghorn Leghorn is right in that we probably can survive the sequester, although it will further slow economic growth and prolong what for many people feels a hell of a lot like a depression.  The main hope I see for easing the gridlock in Washington is, believe it or not, Karl Rove.  Rove has mounted a new campaign to push Tea Party wack jobs out of the Republican Party, and replace them with ordinary conservatives.

We'll see how successful he is in 2014.