By Bill Wilson — Were it not so deadly serious, the spectacle in Europe would be a sure bet for the top slot on Comedy Central’s fall line-up. With each passing day, the twisted machinations of the “Eurocrats” and their underlings in the banks become more absurd.
But now, true to form and precedent, “Europe” has come up with a scheme that might pull their collective chestnuts out of the fire; send the tab for decades of waste, soft-socialism and outright fraud to other people including the taxpayers of the United States. I guess you can take the Europeans out of the business of imperialism but you can’t take imperialistic impulses out of Europeans.
The situation is well known. Nations throughout Europe borrowed huge amounts of money they had no way to pay back. Just as with the sub-prime mortgage crisis in the U.S., these nations took on far more than they could handle. Even with tentative moves to rein-in spending, their debt is simply not sound. In a well-ordered free-market world, they would default and negotiate with the people who gave them the credit for a pay-off plan, reduce the amount owed and begin with a fresh start.
But in the case of Europe, that would mean the big banks would have to suffer large losses. And since these same banks have bought insurance from each other and from U.S. financial institutions, there is no way to know which banks would fail and which could survive. Now it’s one thing for a country to be in trouble. But when the banks are threatened all the Masters of the Universe come to the rescue.
After many failed attempts to prop up the banks, we have come to a crisis point. So, here is the plan the hucksters have come up with. The Europeans set up a “financial rescue fund” (EFSF) and put €440 billion in it. But that is not near enough to bail out the banks of the consolidated debts of Portugal, Italy, Ireland, Greece, and Spain (PIIGS), which total more than €3 trillion. To get enough, the idea is to have the EFSF set up a special investment fund that will sell bonds, take the money received for the bonds and then use it to prop up the nations so they can pay the banks.
By doing it this way the European elites can side-step their own law and still get the funding they want to pay the bankers. But there is a rub. Where does the money come from for this special investment fund?
That is now the open question. China maybe. Perhaps Brazil. Germany has ruled out the use of the European Central Bank (ECB). So the odds on favorite is the International Monetary Fund (IMF). And that is where US taxpayers get hosed. The United States pays 17.7 percent of IMF funding.
A consensus is building that the special investment fund will need at least an extra €1 trillion euro — or nearly $1.4 trillion. Should the IMF be the vehicle for this scam, that would mean they would be holding the €1 trillion in debt that is only backed by the debt of Greece and the rest of bankrupt Europe. We, the taxpayers of the United States, would be on the hook for 17+ percent of that, or more than $235 billion.
Beyond the money, this approach would be saddling hardworking American taxpayers with the debt of foreign nations on top of the obscene $14.940 trillion debt of the U.S. government. Were such a thing ever put to a vote of the American people the defeat would be of historic proportions.
So, breaking this down, the Europeans are doing what they always do — shirk their responsibility. Bankers are doing what they always do, stick someone else for the bill to cover their own bad bets. The globalist One-Worlders do as they have always done by looking to use the crisis to expand the power of their international groups. The politicians in Washington can be counted on to do as they always do; hide until they think it is safe to do what the bankers and the elites tell them to do.
The only open question is what the American people will do. They can allow themselves to be diverted by bread and circuses and not raise an eyebrow over yet more debt piled onto their backs. Or, they can put a stop to it and demand Congress forbid the IMF from using one penny of American tax money to bailout Europe’s banks. This saga is far from being resolved.
Bill Wilson is the President of Americans for Limited Government. You can follow Bill on Twitter at @BillWilsonALG.