Too Weak to Fail

George Will on the bailouts of GM and Greece:

To understand the pertinence to America of events in Greece, notice General Motors' most recent misbehavior. A television commercial featuring CEO Ed Whitacre demonstrates the institutional murkiness and intellectual dishonesty that result when the line between public and private sectors disappears. . . .

Under crony capitalism, when government and corporate America merge, both dissemble.

"Crony Capitalism" (AKA "Corporatism") is a big part of what this book (published pre-Obama) is all about. And with the addition of "The Chicago Way", Crony Capitalism becomes an even bigger feature of American politics.

Will continues:

Now American taxpayers also own a little bit of a small nation. They provide the U.S. contribution of 17 percent of the assets of the International Monetary Fund, which is giving Greece $39 billion (the IMF also is contributing $321 billion to a "stabilization" fund for other eurozone nations with debt problems). So the U.S. government, which would borrow 42 cents of every dollar it spends under the president's 2011 budget, is borrowing to rescue Greece and others from the consequences of their borrowing.

Greece, whose gross domestic product is below that of the Dallas-Fort Worth metropolitan area, is "too big to fail," meaning too inconveniently connected to too many big banks. Bailing out Greece really rescues European banks that improvidently bought Greek bonds. . . .

Read the whole thing for details concerning the idiocy of current European borrowing patterns, and comparisons to the situation in America. Plus the dopiness of the current position of the Greek communist party. And the uselessness of the value-added tax, which is a big feature in the finances of the "PIIGS", the European countries currently in the worst financial shape.

Germans are furious about being the biggest bailers in this bailout of a nation where tax evasion is pandemic. . . .

Why accept "austerity" (as that is understood in Greece -- no more annual bonuses of two months' salary, no more retirement at 53)? Suppose, after pocketing some of the bailout, we just threaten to collapse and make a mess of "Europe"?

Greece now knows the terrific strength of weakness. Beware of Greeks -- or any other people -- receiving gifts.

There are a few predictions out there that the entire world economy could collapse in the next few years --- REALLY collapse. Perhaps the examples of GM and Greece show us how this might become possible.