History proves Dick right. More than two hundred years ago, the American Revolution brought democratic government back to the world from a two-thousand-year exile, and ever since then people have been overthrowing kings, theocrats, and plutocrats across the planet—stealing back democracy. Most recently, it happened in 2011–12 in the Arab world.
During times of crisis, however, this happens in reverse—democracy is surrendered.
As mentioned in chapter 3, this happened in Chile when General Pinochet and the Chicago Boys took over and induced “shock treatment” economics that rapidly transformed Chile into a Royalist paradise.
Before that, it happened in Spain, Italy, and Germany during the last Great Crash. And it nearly happened in America, too, in 1935, had the Business Plot not been foiled.
After the Supreme Court’s Citizens United decision in 2010, our nation, just a few years removed from the 2007–08 financial panic, and on the precipice of the Crash of 2016, was thrust into a fight for its democratic life.
Like a blitzkrieg, the Royalists launched an unprecedented assault on democracy around the globe.
In the United States, they’d learned what had happened after the last Great Crash, when they were banished to the political wilderness for two generations. So this time, they reasoned, if they seized power of the means to enact political and economic change, then nothing would get in their way as they completed their harvesting of the middle class and the entire wealth of the nation.
They would become Masters of the Universe.
First, Greece
In October 2011, Greece’s democratically elected prime minister, George Papandreou, proposed a national referendum on the pending bailout package for his debt-ridden and bankster-conned nation.
Ten years earlier, Goldman Sachs secretly helped Greece hide billions of dollars of debt through the use of complex financial instruments such as credit default swaps.127
This allowed Greece to meet the baseline debt-to-GDP requirements to enter the Eurozone in the first place.128
Goldman made similar deals here in the United States, masking the true value of investments, then selling those worthless investments to customers while placing bets that those same investments would eventually fail. The most notorious example was the Timberwolf129 deal, which brought down an Australian hedge fund, and which Goldman Sachs banksters e-mailed each other about, bragging, “Boy, that Timberwolf was one shitty deal.”130
This sort of behavior by Goldman and other Royalist bankers through the “madness” period of the first decade of the twenty-first century helped inflate very profitable debt bubbles that all eventually popped, most notably the housing bubble in the United States.
The shock wave of the debt bubbles bursting then crossed the Atlantic, hitting Europe and turning Goldman’s debt-masking deal with Greece years earlier sour, thus deepening the crisis.
Always looking ahead, Goldman protected itself from this debt bubble by betting against Greek bonds, expecting that they would eventually fail.
But the main crisis that Greece and other members of the Eurozone faced is that they can’t print their own currency, unlike in the United States.
With only a finite amount of euros in the Greek economy, and hefty obligations to foreign and domestic bankers who’d saddled the Greek people with enormous amounts of debt, the government was facing a default crisis.
Some obligations simply could not be met. Greece either had to tell the bankers to take a hit or tell their own people—their public servants, their pensioners, and their most vulnerable—they have to pony up to pay off the debts run up by the bankers. This is known as “austerity” today, even though it’s the exact same sort of harsh shock economics that the Chicago Boys were perfecting in the 1970s and 1980s.
Greek Prime Minister Papandreou wanted to leave it up to the Greek people to decide if staying in the Eurozone, in exchange for harsh austerity measures, was in their national best interest.
Global bankers panicked, and in less than a week, fearing that the Greek people would tell their creditors to go screw themselves, the bankers at the European Central Bank and the IMF took away democracy in Greece. They forced Papandreou to scrap the idea of a national referendum, and even kicked him out of office for good measure. He was replaced by the former vice president of the European Central Bank, Lucas Papademos.
Even Italian Prime Minister Silvio Berlusconi, whose enormous wealth and national media empire ensured his reelection over and over again despite endless frauds and scandals, was no match for the European technocrats. Berlusconi, too, was forced out of office in 2011 to make sure Italy’s descent into austerity went off without any democratic hitches.
The people of Europe and the world were meant to believe that these nations faced a debt crisis and that radical measures needed to be taken to lower debt-to-GDP levels. However, in nearly every case study in Europe, nations that have endured austerity have actually seen debt-to-GDP ratios increase.
It’s simple to understand why. When you take money out of the hands of working people, as austerity does, then they don’t have as much money to spend in the economy, and everything slows down. When people have smaller paychecks, the government is then collecting even less revenue, thus making deficits worse.
The real reason why austerity was enacted is so that the finite number of euros left in places such as Greece and Italy, as well as in Spain and Portugal and others, would without a doubt wind up in the hands of the wealthy.
In Greece, they lost their health care system. In July 2011, the Royalists in technocratic suits put up some of their demands. They said they’d give Greece a bailout to ward off complete collapse, but in return they wanted a big chunk of the money that was being used to treat sick Greek citizens.
And for the first time, unemployed Greeks who had lost their health benefits now had to pay out of their own pocket for any medical care they needed.
As Dr. Kostas Syrigos, the head of Greece’s largest oncology department, told the New York Times, “We are moving to the same situation that the United States has been in, where when you lose your job and you are uninsured, you aren’t covered.”
Today, that’s the case for roughly half of Greece’s 1.2 million long-term unemployed workers.
One of those unemployed workers is a woman named Elena who was diagnosed with breast cancer a year ago, but under the new Greek law could not receive any medical care because her benefits had expired and she had no money. Without treatment, her tumor grew to the size of an orange and broke through her skin, leaving a gaping wound. At this point, any sort of medical treatment for Elena was hopeless.
After seeing Elena, Dr. Syrigos told the Times, “Things like that are described in textbooks, but you never see them because until now, anybody who got sick in this country could always get help… In Greece right now, to be unemployed means death.”
And these death sentences are ordered by technocrats, who are coldly overseeing massive transfers of wealth from the hands of the people to the hands of the Economic Royalists. They won’t settle until all of Greece is turned into Europe’s Disney World and the Coliseum and Parthenon are Lloyd Blankfein’s new mansions.
These events in Europe prompted New York Times editorialist Ross Douthat to make this observation about the theft of democracy in an op-ed in November 2011 titled, “Conspiracies, Coups and Currencies.” He wrote, “[F]or the inhabitants of Italy and Greece, who have just watched democratically elected governments toppled by pressure from financiers, European Union bureaucrats and foreign heads of state, it evokes the cold reality of 21st-century politics. Democracy may be nice in theory, but in a time of crisis it’s the technocrats who really get to call the shots [italics added].”131