Saturday, January 29, 2011

How the Monsters at Goldman Sachs Caused a Greek Tragedy by Jim Hightower

This is a great article which full explains the on-going Greek economic crisis.  I cite the section of the article on the Greek crisis.

From the site:

Perhaps he was referring to one of the Greek gods. It turns out that, for the past decade, Goldman has also been practicing its ethical flimflammery in Greece, a nation long mired in a sea of debt.
In 2001, Goldman's financial alchemists formulated a scheme to allow the Greek government to hide the extent of its rising debt from the public and the European Community's budget overseers. Under this diabolical deal, Goldman funneled new capital from super-wealthy investors into the government's coffers.
Fine. Not so fine, though, is that, in exchange, Greek officials secretly agreed that the investors would get 20 years' worth of the annual revenue generated by such public assets as Greece's airports. For its part, Goldman pocketed $300 million in fees paid by the country's unwitting taxpayers.
The financial giant dubbed its airport scheme "Aeolus," after the ancient Greek god of the wind -- and, sure enough, any long-term financial benefit for Greece was soon gone with the wind. By hiding the fact that the government's future revenues had been consigned to secret investors, Goldman bankers made the country's balance sheet look much rosier than it was, allowing Greek officials to keep spending like there was no tomorrow.
Last month, however, tomorrow arrived. Greece's crushing debt has exploded into a full-blown crisis, with its leaders disgraced and the country on the precipice of the unthinkable: the default of a sovereign nation.
So, who is getting punished for the finagling of Greek politicos and Goldman profiteers? The people, of course -- just like here! Greeks now face deep wage cuts, rising taxes and the elimination of public services just so their government can pay off debts the people didn't even know it had. Meanwhile, Greece's financial conflagration is endangering the stability of Europe's currency and causing financial systems worldwide (including ours) to wobble again. All of this to enrich a handful of global speculators.

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