Focal Points Blog

Fukushima: Which Is It? “Certain level of success” or “crisis still not resolved”?

Yukiya Amano, the director-general of the International Atomic Energy Agency, reports CNN, isn’t too sanguine.

“The crisis has still not been resolved, and the situation at the Fukushima Daiichi nuclear power plant remains very serious,” Yukiya Amano, the director-general of the International Atomic Energy Agency, told its board of governors Monday after a visit to the site. “Buildings have been damaged by explosions,” he said. “There has, for the most part, been no electric power. Radiation levels are elevated. It is no exaggeration to describe the work of the emergency teams as heroic.”

Still, reports the Wall Street Journal, to Chief Cabinet Secretary Yukio Edano, their success bringing down the temperature in the reactors represents “a certain level of success.” WSJ agrees.

Japan appears to have turned the tide in its battle to stave off nuclear disaster, restoring power to parts of the Fukushima Daiichi plant and bringing down radiation levels with a marathon water-spraying operation. . . . Fighting its way through rubble in heavy protective gear, the [Tokyo fire department’s] Hyper Rescue Squad poured [the] equivalent to dumping an entire Olympic-size swimming pool on the No. 3 reactor’s area for spent fuel. . . . From the start, the battle at Fukushima Daiichi was about water. Without a way to pump large quantities into the plant, Tepco suffered a daily parade of disasters in the early days.

Why the wait? As I posted earlier

Last night on MSNBC’s Hardball with Chris Matthews, former head of the U.S. Nuclear Regulatory Commission Jeffrey Merrifield mentioned that the Japanese made a critical mistake in overlooking the evaporating pool problem while attending to more pressing matters (presumably the explosions). As a consequence what seems like the simplest task — keeping pools filled with water after the pump has broken — has snowballed into a national emergency.

To give the Japanese their due, even though it was just water — with which the region was, of course, inundated — supplying it to the reactors proved was more difficult than one would think.

Officials later learned that Tepco had already sought to borrow some of the squad’s vehicles. According to Mr. Ishihara, squad members drove up to Fukushima but had to come back to Tokyo after it became clear that the vehicles were too complex for Tepco’s in-house firefighters to operate.

At a news conference, Tokyo Gov. Shintaro Ishihara said “It’s such a shame we had wasted a lot of time.”

Americans might gloat that such inefficiency in the face of a disaster could never happen here. But, as many have already pointed out, six years ago our tardy and fragmented response to Hurricane Katrina — George Bush or no — gave the lie to that national myth. Anyway, a hyper, hyper hooray to the Hyper Rescue Squad.

In the End, Fukushima a Gift to the Nuclear Energy Industry?

At Pro Publica, in an article titled Even In Worst Case, Japan’s Nuclear Disaster Will Have Limited Reach Abrahm Lustgarten

. . . spoke with seven top nuclear engineers and scientists to at least establish some boundaries for the disaster’s potential health and environmental impacts. The rough consensus: The long-term and most severe effects from radiation at the plant, where four of six reactors are in crisis and hundreds of tons of spent fuel is a risk, will be largely contained to the area around the plant, affect a relatively limited population and will likely not spread outside Japan.

So what, as Reuters reports, if the

. . . unprecedented multiple crisis will cost the world’s third largest economy nearly $200 billion and require Japan’s biggest reconstruction push since post-World War II.

Uncovered by insurance because it was an act of God (however Old Testament)? No problem.

The highly specialized German Nuclear Reactor Insurance Association (DKVG) partially insured Japan’s Fukushima nuclear plant to the tune of tens of millions of euros. But the Cologne-based insurer won’t be paying anything.

“We do have a stake in the risks in Japan, generally speaking. But the property insurance and liability insurance policies exclude damages from earthquakes, tsunamis and volcanic eruptions,” DKVG chief executive Dirk Harbrücker told Deutsche Welle.

Never mind that when it comes to building new reactors, the Independent reports that “some estimates suggest extra safety will add at least another 10 per cent.”

The case will be made that the Fukushima reactors, despite how old they were, survived both an earthquake and tsunami with attendant explosions, fires, and loss of water to spent fuel rods with minimal (by some standards, anyway) leakage of radiation into the atmosphere. Fukushima could turn into the gift that keeps on giving for nuclear energy advocates.

Except for one small stumbling block: because neither Fukushima’s nor any other reactors have been attacked by terrorists, it remains to be seen how one would stand up to subversion from within, assault by ground troops, or a plane loaded with explosives crashing into it.

Will Libya Become a Second Iraq?

Since the United States performed an abrupt about-face on Libya, supporting a U.N. resolution that authorizes “all necessary measures” to counter Qaddafi’s assault on the rebels, military intervention appears likely. Opponents of intervention urge their audiences to recall the Iraq invasion—also launched, in part, on humanitarian grounds—and keenly insist on drawing parallels with that disaster.

But are comparisons with Bush’s attack on Iraq accurate?

The argument for invading Iraq was couched in the context of fighting terrorism and made by political forces who sought to capitalize on that context. Neoconservatives, who saw the political climate as an opportunity to advance Israeli interests by subsuming them under the “war on terror,” avidly pressed for war. Republicans, eager to exact revenge for September 11th and aggrandize power, cared little whether the Arabs selected for destruction were perpetrators of the offending crime.

As for Iraqis, while many hoped for Saddam’s demise, few supported American invasion. The most zealous Iraqi advocates of war were opportunists who lived abroad in posh self-imposed exile. And while hawks sounded the appropriate noises about “liberation” now and again, that rhetoric saturated the discourse only after—and only because—the earlier pretexts of WMDs and al-Qaeda “links” vanished.

Today, the political mood could scarcely be more different. The revolt that now sweeps the Arab world stands as a devastating rejoinder to neoconservatives, who painted Arabs and Muslims as innately fond of terror and despotism. Authors of yesterday’s events, neoconservatives are now desperate just to appear in the footnotes. They have vacillated wildly, with some decrying the Egyptian revolution only to urge help for Libya’s rebels.

Whatever their opinion, it is the Libyans and the Arabs themselves who have most urgently raised the call for intervention. Libya’s rebel commanders and the transitional government in Benghazi have for weeks demanded a no-fly zone and air support. The Arab League, an ossified organization nervous over the prospect of further roiling the masses, reflected popular Arab opinion by stamping its seal of approval on the rebels’ pleas. Indeed, when the UN passed the resolution inviting air strikes, Benghazi erupted in euphoria.

The differences in both the political climate and the balance of forces on the ground clearly differentiate Iraq from Libya. But they do not “disappear” the possibility that Libya may end up like “post-war” Iraq: a nation deeply divided not by sect and language but by geography and tribe. For Western warplanes may shield rebel enclaves and cities, but what role will the French, British, and Americans play when the rebels try to advance westward and capture or recapture areas run by Qaddafi? Though the choreographed displays of “support” suggests Qaddafi’s base may be broad rather than deep, he still retains the support of his tribe and other allied tribes.

As one civilian in Tripoli opined after learning of the U.N. resolution’s passage, “Civilians holding guns, and you want to protect them? It’s a joke, We are the civilians. What about us?

This complicated reality blunts the persuasive force of the interventionist position, but also dampens the appeal of the non-interventionist one. Action today may pose risks for tomorrow, but inaction today poses risks for today as well as tomorrow: can we truly tell Libyans, “I don’t support intervention because I know better than you and, believe me, it’s better if you are crushed by Qaddafi than rescued by air strikes that may pose risks down the line?”

That is one of many questions that both sides of the debate will need to pose, and answer, in the coming days and weeks.

M. Junaid Levesque-Alam blogs on Islam and America at his website, Crossing the Crescent.

Chevron’s Outlandish Fraud Charges Deprive Ecuadorians of Justice

Ecuador TexacoJust weeks after an Ecuadoran court handed down its landmark decision against American multinational Chevron, the oil giant has filed an appeal to prevent having to pay billions in environmental damages wrought in the Amazonian rain forest. The court had ruled that Chevron pay a $9.5 billion fine for the destruction Texaco—which merged with Chevron in 2001—inflicted on the Amazon through its operations, a decision the company dismissed as corrupt. In a statement released last Friday, Chevron reported that it’s prepared to demonstrate “the pattern of fraud by the plaintiffs’ lawyers, supporters and others that has corrupted the trial, as well as the numerous legal and factual defects in the judgment.”

The appeal comes as no surprise. Chevron moved immediately before the verdict last month to initiate proceedings in The Hague designed to block the enforcement of any ruling against the company and extend arbitration. The oil multinational also filed papers in the United States to affect a similar outcome and, according to the BBC, accused “the claimants and lawyers in the case of racketeering, tampering with witnesses and obstructing justice.”

Whatever the result, Chevron’s challenge spells the indefinite suspension of justice for local Ecuadorians suffering decades-old environmental and human rights abuses.

The roots of the case can be traced back decades. Texaco, now owned by Chevron, first prospected for oil in the Amazon in 1964, quickly finding enormous reserves and contracting with national oil companies to extract their find. In the process, the multinational reportedly dumped nearly 20 billion gallons of toxic sludge in the jungle and was responsible for another 16 billion gallons of oil spilled over the course of its twenty-five year presence in the country. The damage sustained was extensive, poisoning the region’s soil and water and, according to plaintiffs in the case, causing a spiking rise in cancer deaths and birth defects. In 1993, lawyers representing a group of 30,000 affected Ecuadorans brought suit against Chevron in a US court to seek damages.

Chevron’s claim that it didn’t receive a fair shake by the Ecuadoran legal system is questionable in the extreme, seeing as the company fought tooth-and-nail at the start of proceedings to have the case removed from US jurisdiction and tried in South America. Nevertheless, US District Judge Lewis Kaplan ruled last week in New York that plaintiffs in the case could not seek reparations from Chevron in the United States due to “abundant evidence before the court that Ecuador has not provided impartial tribunals or procedures compatible with due process of law.” Kaplan’s decision effectively nullifies the ruling in Ecuador, where Chevron no longer operates or possesses any assets.

The company also defends itself with the flimsy argument that Texaco had previously invested in cleanup efforts and toxic removal to a tune of $40 million. Put in perspective, the Exxon Valdez spill—which amounted to less than a third of the oil damage suffered by the Amazon—cost billions to clean up, and the US government heaped a whopping $5 billion fine on the company for its malfeasance and irresponsibility. Moreover, the poorly funded efforts by Texaco to clean up its mess proved inadequate to the task. Dozens of spillage sites throughout the Amazonian region still exhibit “concentrations of carcinogenic chemicals at hundreds and sometimes thousands of times higher than US acceptable standards,” according to the Inter Press Service.

So what’s next? Years of continued deliberation in various courts, in all likelihood, with little chance of just resolution. Speaking with the Associated Press in February, Wall Street analyst Fadel Gheit cynically noted that the plantifs “thought they could get something, but it’s not going to happen. If so, it would be unprecedented. Companies like Chevron have been accused of polluting for decades” in resource-rich, underdeveloped countries without any consequences.

Meanwhile, local populations that do not have the luxury of simply picking up and moving on after plundering the land of its resources continue to suffer. Rates of cancer, miscarriages, birth defects, and leukemia diagnosed in children continue to register at significantly higher rates in oil-infected areas throughout the Amazon. But the impact of the toxic contamination isn’t witnessed purely through statistics. According to the activist group Amazon Watch, even the basic routines of everyday life offer reminders of Texaco’s legacy of irresponsibility. Beyond the startling “epidemic of these deadly health problems, far more people suffer from frequent illness of a more minor type. Those who bathe in contaminated rivers report skin rashes. Those who drink the water report diarrhea. In this way, oil contamination has become a constant, oppressive, inescapable fact of life for thousands of residents” in the Amazon.

For Clue to How U.S. Would Respond to Its Own Fukushima, Look at Financial Crisis

At the Bulletin of the Atomic Scientists, Hugh Gusterson writes, “As an anthropologist, I am always interested in what humans learn from their mistakes. . . . what lessons will we learn from the nuclear accident at Fukushima, an accident thought to be impossible just two weeks ago?”

More to the point, what will be the United States’s “takeaway” from this crisis? Gusterson:

A good way to think through this question is to look at how the United States responded to its last meltdown — the meltdown of its banking system in 2008. To prevent a future recurrence of this disaster, the US government should have broken up banks that were “too big to fail,” restored the Glass-Steagall Act’s prohibitions on the commingling of investment and depository banks, and moved aggressively to regulate credit default swaps and financial derivatives. It did none of these things because the banks did not want it to, and the banks now run the show. . . . Our democracy and our regulatory agencies are husks of what they once were.

Free Trade’s Winners and Losers in Latin America

Cross-posted from Other Words.

President Barack Obama is traveling to Latin America, seeking refuge from budget battles at home by promoting increased trade with countries across the region. During his trip to Chile, Brazil, and El Salvador, he’s expected to highlight the benefits of so-called “free trade” to U.S. and Latin American businesses.

While the U.S. Chamber of Commerce and many conservatives in Congress will cheer him on, the truth is that free trade has been a curse for farmers and the poor throughout Latin America for years. It’s time for a better approach.

Avid free-traders will tell you trade between the U.S. and Mexico has grown nearly five-fold since NAFTA was enacted in 1994. They’ll say two-way trade between the United States and Central America and the Dominican Republic was $37.9 billion in 2009, a significant expansion thanks to the CAFTA-DR free trade agreement.

While free trade can dramatically increase exports–and boost corporate profits–its impact on the working class and poor isn’t so rosy.

Examining the impact of NAFTA–the hallmark free-trade agreement among the United States, Canada, and Mexico–provides a glimpse at free trade’s impact on Latin America’s poor. Research has shown that the 1.3 million jobs created in Mexico during the peak period of the maquiladora industry between 1994 and 2001 only provided a small portion of the jobs needed to cover the millions of workers pushed off their farms or forced out of Mexico’s devastated domestic industries.

Researchers have found that only 10 percent of Mexicans have seen any rise in their incomes or standard of living thanks to NAFTA. In fact, the vast majority are far worse off.

Mexican corn farmers–the cornerstone of Mexico’s agricultural economy before NAFTA–have been hit the hardest. Some estimates suggest millions of Mexican corn farmers were driven off their land, unable to compete with highly mechanized U.S. corn imports. Left with no job options at home, many have come here.

Now Obama wants Congress to ratify a free-trade agreement with Colombia signed during the Bush administration. This deal won’t just turn a blind eye towards egregious labor rights violations in Colombia, where more union leaders were assassinated in 2010 than the rest of the world combined. Most likely, it will push more farmers into producing coca, the raw material for cocaine.

A free-trade agreement with Colombia would devastate that country’s small farmers–just as NAFTA did in Mexico. The escape valve for Mexican farmers has been emigration to the United States, with an estimated 30 crossing the border every hour. The escape valve for Colombian farmers will be farming coca.

Colombia is already the world’s leading cocaine manufacturer and a top producer of coca, the drug’s main ingredient, with an estimated 120,000 hectares in production. It’s slightly more profitable than farming food crops. A free-trade agreement that floods Colombian markets with cheap U.S.-produced grains would put poor farmers in an unenviable position: fall deeper into poverty or switch to coca production.

That’s why the Chamber of Commerce isn’t the only group salivating over the prospect of Congress ratifying the U.S.-Colombia free-trade agreement. Drug traffickers would welcome the surge in coca production that tariff-free trade with that South American nation would trigger.

Jess Hunter-Bowman is the Associate Director of Witness for Peace, a nonprofit organization with a 30-year history monitoring U.S. policy in Latin America.

Commentary Urges Congress to Investigate PBS for Linking to Right Web!

CommentaryOn March 13, 2011, Commentary magazine’s Contentions blog published an entry from Michael Rubin, a scholar at the American Enterprise Institute, in which he attacked Right Web for employing standards “embraced by conspiracy theorists like the LaRouchies, 9/11 revisionists, and Birthers.” He also criticized Right Web’s director and editor on the basis of a stark mischaracterization of a correspondence between the two from November 2009.

Rubin went on to suggest that Congress should consider investigating PBS for having published articles on Frontline’s Tehran Bureau website that link to Right Web profiles, writing that “congressmen might want to ask PBS’s Frontline about the editorial decision to substitute these fake, conspiracy-riddled biographies for the real thing.”

Go to Right Web itself to read the rest of the story:
Commentary Smears Right Web

Libya Needs Cancer of Gaddafi Removed, But U.S. More Slasher Than Surgeon

Gaddafi

(Pictured: The tyrant as a young officer.)

The Security Council voted late Thursday by 10 votes to zero, but with five abstentions, for a resolution that authorized military action to protect civilians. The resolution included many understandable reservations and cautions, bearing in mind the US record. Not least it precluded foreign occupation.

We can accept that a patient with a brain tumour might desperately need surgery, but there is still cause for alarm if Jack the Ripper offers to operate. Both method and motive are open to question.

So while no person with a conscience wants Gaddafi to win his sanguinary battle of repression against his own people, there are more than enough doubts that the US is the appropriate specialist to call. However, like Jack the Ripper – they do have the knives. We should avoid the reflexive binary positions both of those who support any intervention in an Arab country and those who equally obdurately oppose any intervention by any Western power, anywhere.

In fact, ever since the 2005 General Assembly when Kofi Annan steered the UN General Assembly into accepting that that the Security Council’s remit over threats to peace and security extended to what was happening inside sovereign nations, there is legal grounds for Security Council intervention.

There is clearly present need, unless the world is prepared to stand by and watch massacres of disloyal Libyans. And of course, one of the problems with the US as a self-appointed instrument in this case is that Washington seems neutral about not dissimilar events in Bahrain, Yemen or even in Gaza, preferring to arm the perpetrators and provide some measure of diplomatic protection. The sudden US rediscovery of Libyan tyranny is also somewhat problematic, as indeed are its previous military attacks on Libya.

Susan Rice, the US Ambassador to the UN spoke eloquently, and from her previous record, probably sincerely, about the need for intervention. However, a few weeks before she had with deep insincerity cast a veto expressing her own and American opinion on Israel’s repression and breaches of international law in the West Bank!

Even accepting the motive, method is a problem. Consistently in Iraq, Afghanistan and elsewhere, the US has shown a predilection for high technology ariel warfare and shown a propensity to risk civilian life rather put its own military at risk. Even in Kosovo, which most of the locals consider gratefully to have been a “good” war, President Clinton’s refusal to countenance ground forces or risk American casualties by bombing from below 15,000 feet incurred unnecessary casualties and eroded international support, while not frightening Serb leader Milosevic in the slightest.

In Libya, it might be different. Clearly identifiable columns of government forces trailing along the few passable roads along the coast would make an easily identifiable targets. But US over-caution, in wanting to take out Libya’s negligible air defences before acting could easily involve serious mistakes and casualties. No one who saw the WikiLeaks video of the helicopter gunning down journalists in Baghdad is going take the sensitivity of the US military for granted. We do not want Benghazi destroyed to save it.

On the positive side, decisive intervention would send a clear message to Gaddafi’s forces, largely one might presume motivated by fear of reprisals from the regime that there were speedier and worse consequences than that, or indeed an eventual trip to International Criminal Court in The Hague.

As to motive, one of the reasons that Russia has been reluctant to consider a military option, apart from its own bugbears like Chechnya, has been Foreign Minister Sergei Lavrov’s personal experience of American arrogance in times past. Moscow supported intervention against Iraq after the invasion of Kuwait, and then as UN Ambassador he was consistently snubbed and humiliated by the US and UK as they pursued the resolutions, the sanctions, the air strikes and the rest, far beyond the intention of the resolutions or the will of the majority of the Security Council.

So, immediate surgery is needed. It would be best to find a more trusted surgeon, but if Jack the Ripper has the only scalpels, what do you do?

Just before the vote I suggested that there are two elements that should be considered in any such UN resolution, both to get Russian and maybe even Chinese support, and to reassure many others around the world.

The first is to ensure a sunset clause. Any mandate for military action should have precise limitations both about the nature of operations and a time limit. It should return to the Council within days or weeks for a renewal of authority. Secondly, there is a need to ensure that there is some element of shared control over operations. After the Rwanda and Srebrenica debacles no one, including the UN Secretariat itself, would or should entrust this task to international civil servants. But a subcommittee of the Security Council, or even a revival of the long somnolent UN Military Staff Committee, of representatives of the Permanent Five members should provide some reassurance against irrational exuberance on the part of the Pentagon. The machinery is there just waiting reactivation. Indeed the Pentagon has a Military Staff Committee whose purpose is to liaise with the UN body.

It is possible that these might have averted some of the abstentions, but certainly the language of the resolution, invoking constant reporting to and monitoring by the Security Council and the Secretary General, averted the otherwise inevitable vetoes. Ban Ki Moon’s principled stands on the region’s regimes over the last few months, for which he has had insufficient credit, suggests he will certainly take the job seriously.

Those who are opposed to intervention on principle will of course continue to do so. But the Libyan opposition, who have asked for help, are the ones who will pay the price for others’ high-mindedness. Pragmatic mandates could help.

Fukushima: How Can It Be So Hard to Keep Water in a Pool?

One of the most useful sources of information on Fukushima is Barry Brooks’ Brave New Climate, where he reports on the cooling tanks for spent rods:

The problem is that as these ponds heat, their deep covering of water (which acts as a radiation shield and a cooling mechanism), starts to evaporate. If they reach boiling point, because of lack of operational maintenance systems, the evaporation rate will accelerate. If exposed, there is a potential for these old fuel rods and their zirconium cladding to melt, and radiation levels will rise considerably. . . . The spent fuel pool temperature has been rising gradually since last Friday due to the loss of cooling pump (presumably no power source).

Sure, the pump may not work — ’cause a vandal (known as The Tsunami) took the handle. But why is it so difficult to keep a pool refreshed with water? It’s not as if it’s Olympic-sized.

The Japanese finally brought in firefighting vehicles to douse the rods. Then, in a desperate, if dramatic move, the Japanese used helicopters to fetch water from the ocean and bombard the plant with it.

Last night on MSNBC’s Hardball with Chris Matthews, former head of the U.S. Nuclear Regulatory Commission Jeffrey Merrifield mentioned that the Japanese made a critical mistake in overlooking the evaporating pool problem while attending to more pressing matters (presumably the explosions). As a consequence what seems like the simplest task — keeping pools filled with water after the pump has broken — has snowballed into a national emergency.

Europe’s Austerity: Like Something Out of the Brothers Grimm

Greek protest(Pictured: Greek protest.)

* In the Greek town of Aphidal, people have stopped paying road fees. In Athens, bus and metro riders are refusing to cough up the price of a ticket. On Feb. 23, 250,000 Greeks jammed the streets outside the nation’s parliament.

* The Portuguese nominated the protest song “A Luta E’ Alegria” (The Struggle is Joy) for the Eurovision song contest and, when judges ignored it, walked out in protest. They also put 300,000 people into the streets of the country’s major cities on Mar. 12.

* Liverpool bailed from a Conservative-Liberal scheme to supplement government funding with private funding when it found there wasn’t any of either, and the British Toilet Association protested the closure of 1,000 public bathrooms across the country.

In ways big and small, Europeans from Greece to Portugal, from Britain to Bavaria are registering their growing anger with the relentless assault inflicted by government-imposed austerity programs.

Wages, working conditions and pensions that unions successfully fought for over the past half century are threatened by the collapse of banking systems caught up in a decade-long orgy of speculation that the average European neither took part in, nor profited from. Even the so-called “well off” workers of Bavaria, Germany’s industrial juggernaut, saw their wages, adjusted for inflation, fall 4.5 percent over the past 10 years.

The narrative emanating from EU headquarters in Brussels is that high wages, early retirement, generous benefits, and a “lack of competition” has led to the current crisis that has several countries on the verge of bankruptcy, including Ireland, Greece, Portugal and Spain. Now, claim the “virtuous countries”—Germany, the Netherlands, and Finland—it is time for these spendthrift wastrels to pay the piper or, as German Chancellor Andrea Merkel says, “do their homework.”

It is an interesting story, a sort of Grimm’s fairy tale for the 21st century, but it bears about as much resemblance to the cause of the crisis as Cinderella’s fairy godmother does to the International Monetary Fund (IMF).

While each country has its own particular conditions, there is a common thread that underlines the current crisis. Starting early in the decade, banks and financial houses flooded real estate markets with money, fueling a speculation explosion that inflated an enormous bubble. In climate and culture, Spain and Ireland may be very different places, but housing prices rocketed 500 percent in both countries.

The money was virtually free, with low interest rates on the bank side, and cozy tax deals cut between speculators and politicians on the other. That kept the cash within a small circle of investors. While Bavarian workers were watching their pay fall, German banks were taking in record profits and shoveling yet more capital into the real estate bubbles in Ireland and Spain. The level of debt eventually approached the grotesque. Ireland’s bank debts, if translated into dollars, would be the equal of $10 trillion.

The Wall Street implosion in 2008 sent shock waves around the world and popped bubbles all over Europe. While nations on the periphery of the European Union (EU) tanked first—Iceland, Ireland, Latvia, Romania, Hungary, and Greece, economies at the heart of the EU—Britain, Spain, Italy, and Portugal—were also shaken. According to the Financial Times (FT), total claims by European banks on the Greek, Irish, Italian, Spanish and Portuguese debts alone are $2.4 trillion.

The European Union’s (EU) cure for the crisis is a formula with a long and troubled history, and one that has sowed several decades of falling living standards and frozen economies when it was applied to Latin America some 30 years ago. In simple terms, it is austerity, austerity and more austerity until the bank debts are paid off.

There are similarities between the current European crisis and the 1981 Latin American debt crisis. “In both cases debts were issued in a currency over which borrowing countries had no control,” says the FT’s John Rathbone. For Latin America it was the dollar, for Europe the Euro. Secondly, there was first a period of easy credit, followed by a worldwide recession.

Bailouts were tied to the so-called “Washington Consensus” that demanded privatization, massive cuts in social services, wage reductions, and government austerity. The results were disastrous. As public health programs were eviscerated, diseases like cholera reappeared. As education budgets were slashed, illiteracy increased. And as public works projects vanished, joblessness went up and wages went down.

“It took several years to realize that deflating wages and shrinking economies were inconsistent with being able to fully pay off debts,” notes Rathbone. And yet the “virtuous” EU countries are applying almost exactly the same formula to the current debt crisis in Europe.

For instance, the EU and the IMF agreed to bail out Ireland’s banks for $114 billion, but only if the Irish cut $4 billion over the next four years, raised payroll taxes 41 percent, cut old age pensions, increased the retirement age, slashed social spending, and privatized many public services. When Ireland recently asked for a reduction in the onerous interest rate for this bailout, the EU agreed to lower it 1 percent and spread out the payments, but only on the condition of yet more austerity measures and an increase in Ireland’s corporate tax rate. The newly elected Fine Gael/Labor government refused.

To pay back its own $152 billion bailout, however, the Greek government took the deal. But the price is more austerity and an agreement to sell off almost $70 billion in government properties, including some islands and many of the Olympic games sites.

But the “deal” will hardly repay the debt. Unemployment in Greece is 15 percent, and as high as 35 percent among the young. Wages have fallen 20 percent, pensions have been cut, and rates for public services hiked. Growth is expected to fall 3.4 percent this year, which means that Greece’s debt burden is projected to increase from 127 percent of GDP to 160 percent of GDP by 2013. “Your debt will continue to increase as long as your growth rate is below the interest rate you are paying,” economist Peter Westaway told the New York Times.

Austerity measures in Portugal and Spain have also cut deeply into the average person’s income and made life measurably harder. In Spain, more than one in five workers are unemployed, and consumer spending is sharply off, dropping by a third this past holiday season. Portugal is actually in worse shape. It has one of the slowest economic growth rates in Europe, a dead-in-the-water export industry, and a youth unemployment rate of over 30 percent.

In Britain, the Conservative-Liberal government has cut almost $130 billion from the budget and lobbied for what it calls the “Big Society.” The latter is similar to George H.W. Bush’s “thousand points of light” and envisions a world in which private industry and volunteerism replaces government-funded programs. The actual result has been the closure of libraries, senior centers, public pools, youth programs, and public toilets. The cutbacks have been most deeply felt in poorer areas of the country—those that traditionally vote Labor, as cynics are wont to point out—but they have also taken a bite out of the Conservative Party’s heartland, the Midlands.

Conservative voters have organized demonstrations to save libraries in staid communities like Charlbury and to protest turning public woodlands over to private developers. According to retired financial officer Barbara Allison, there are 54 local voluntary organizations that run programs like meals on wheels in Charlbury. “We’re already devoting an awful lot of our time to charity and volunteers,” she told the FT. “Am I not doing enough? Is [Conservative Prime Minister] David Cameron going to volunteer?” In any case, as Labor Party leader Ed Milliband points out, how does Cameron expect people “to volunteer at the local library when it is being shut down?”

U.S. Treasury Secretary Timothy Geithner strongly endorsed the Cameron program last month and said that he “did not see much risk” that the cutbacks would impede growth. But even the IMF warns that the formula of treating debt as the central problem in the middle of an economic recession has drawbacks. This past October an IMF study concluded “the idea that fiscal austerity stimulates economic activity in the short term finds little support in the data.”

But a massive program of privatization does mean enormous windfall profits for private investors and the banks and financial institutions that finance the purchase of everything from soccer fields to national parks. Those profits, in turn, fuel political machines that use money and media to dominate the narrative that greedy pensioners, lay-about teachers, and freeloaders are the problem. And austerity is the solution.

But increasingly people are not buying the message, and from Athens to Wisconsin they are taking their reservations to the streets. The crowd in Charlbury was a modest 200, and the tone polite. In Athens the demonstration drew 250,000 and people chanted “Kleftes,” or “thieves.” But the message in both places is much the same: we have had enough.

A bus driver in Athens told Australian journalist Kia Mistilis that his wages had been cut from 1800 Euros ($2,500) a month to 1200 Euros ($1,660). “There are more cuts coming into effect in the next three months, that’s why the protests are heating up. I am worried that my wages will be cut to 800 Euros ($1,110) a month, and if that happens I don’t know how I will survive.”

But he has a plan. “The situation is reaching a climax,” he told Mistilis, “because working people know that the austerity measures go too far, and with the final rollout, they can’t survive. So there is nothing to do but protest,” adding, “You wait until next summer. The situation in Greece will explode.”

It is unlikely that Greece will be alone.

More of Conn Hallinan’s work can be found at Dispatches From the Edge.

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