Friday, 11 May 2012

11 May 2012

I've managed to get my hands on the transcript of a conversation between a European voter and a major international lender. I should warn you that I can't vouch for its accuracy -- indeed, it may for all I know be a piece of total fiction -- but I thought I'd share it with you anyway … "Voter: I'm going to spell it out for you nice and simple, Mr Lender: we've had enough, we won't take any more, you can take your austerity and stuff it. And we'll get rid of any government that makes the mistake of signing up to your nonsense conditions. We've booted out 10 governments so far, I think, and we're not done yet. "Lender: That's fine by us, Mr Voter. But there's something you need to understand as well. Debts have to be paid, and if you fail to pay up, there will be consequences. If you don't believe me, ask your mortgage lender what'll happen if you default on your mortgage. "Voter: Wrong, Mr Lender. They're not my debts. I'm not the one who invented ridiculously complex financial products so that billions of dollars could swill about the banking system without anyone understanding what was going on. And while we're at it, I'm not the one who's getting paid astronomical salaries and bonuses while our economy disappears down the plughole. It's your problem, buster, not mine. "Lender: I don't think you quite get it, Mr Voter. You happily ran up your credit card debts, didn't you, and merrily borrowed vast amounts to buy a home that you couldn't possibly afford? I don't remember you complaining when you borrowed to buy your outsize plasma TV screen, or to extend your home, or buy your gas-guzzling 4x4. Where do you think all that cash came from? Did you really not stop to think for a single second that one day it would all have to be paid back? "Voter: Now just hang on a minute. If banks lent out far more than they should have done, that's their problem, not mine. I refuse to accept that welfare benefits are cut, pensions slashed, and government spending hacked back, just because you guys screwed up. I'll say it again: your problem, not mine. "Lender: OK, fine. Here's what's going to happen. You want a government that tears up your hated "austerity" plans. You want it to go on spending; in other words, you want it to go on borrowing. But if you think I'm going to go on lending, you can think again. Sure, I could lend -- there's still plenty of Chinese cash swilling about -- but I'd charge so much in interest, it'd make your eyes water. Is that what you want: more debt, at higher interest rates? "Voter: No, that's not what's going to happen. Because you know as well as I do, Mr I've-got-all-the-answers Lender, that you don't want the whole system to collapse any more than I do. Riots on the streets? Thousands of homeless? Parties of the extreme right and extreme left gaining millions of votes? I'm not sure that's going to do your bonuses much good. Remind me: what happened to all the financiers in Moscow in 1917, or Berlin in the 1930s? "Lender: Oh for goodness sake. You're being ridiculous. Let's try to agree that this is a problem we both need to sort out. Yes, I know you're angry. And we lenders aren't being unreasonable. Of course we don't want to see societies fracture -- but the financial system is built on trust. Debts have to be paid, whoever's responsible for them. If they're not, you go bankrupt, and that't not nice, I can assure you. "Voter: Oh yeah? Well, from where I'm sitting, going bankrupt doesn't look much worse than what we've got at the moment. And it has the one big advantage that it hurts you guys as well as the rest of us. What I really can't stomach is the way you sit there in your mansions and your air-conditioned limousines, lecturing me on why I have to suffer while you argue over your bonuses. "Lender: Look, I understand why you're angry. All I'm saying is that you need to understand the consequences of saying No to austerity. We all got things wrong in the past; and now we all have to try to put them right. Believe me, the short-term pain of higher unemployment and lower government spending will pay dividends eventually. You just need to be patient … "Voter: You just don't get it, do you? We've run out of patience, and we don''t believe a word you say. You've proved that you don't have a clue what you're doing; all you care about is your wretched bonuses. You think you have more power than us voters? You think you can force us to bail you out while our jobs disappear? Watch this space …" And there the transcript ends. As I say, it may not be entirely accurate; it may even be an utter invention. But I can't help feeling it has the ring of truth to it.

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