Michael Hudson on The Euro Without Germany

Conor: Germany’s swift demise reminds me of the German intelligence agent Bachmann in “A Most Wanted Man.” He’s led to believe he’s operating on an equal level with CIA and British intelligence only to realize too late he was being played the whole time.

Hudson gets to the bottom of what Germany’s downfall will mean for the euro and what the options are for Global South and Eurasian countries as they try to stand up to US hegemony.

By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is The Destiny of Civilization.

The reaction to the sabotage of three of the four Nord Stream 1 and 2 pipelines in four places on Monday, September 26, has focused on speculations about who did it and whether NATO will make a serious attempt to discover the answer. Yet instead of panic, there has been a great sigh of diplomatic relief, even calm. Disabling these pipelines ends the uncertainty and worries on the part of US/NATO diplomats that nearly reached a crisis proportion the previous week, when large demonstrations took place in Germany calling for the sanctions to end and to commission Nord Stream 2 to resolve energy shortage.

The German public was coming to understand what it meant that their steel companies, fertilizer companies, glass companies and toilet-paper companies were shutting down. These companies were forecasting that they would have to go out of business entirely – or shift operations to the United States – if Germany did not withdraw from the trade and currency sanctions against Russia and permit gas and oil imports to resume, and presumably to fall back from their astronomical eight to tenfold increase.

Yet State Department hawk Victoria Nuland already had stated in January that “one way or another Nord Stream 2 will not move forward” if Russia responded to NATO/Ukrainian accelerated military attacks on the Russian-speaking eastern oblasts. President Biden backed up U.S. insistence on February 7, promising that “there will be no longer a Nord Stream 2. We will bring an end to it. … I promise you, we will be able to do it.”

Most observers simply assumed that these statements reflected the obvious fact that German politicians were fully in the US/NATO pocket. They held fast in refusing to authorize Nord Stream 2, and Canada soon seized the Siemens dynamos needed to send gas through Nord Stream 1. That seemed to settle matters until German industry – and a rising number of voters – finally began to calculate just what blocking Russian gas would mean for Germany’s industrial firm. 

Germany’s willingness to self-impose an economic depression was wavering – although not its politicians or the EU bureaucracy. If German policymakers were to put German business interests and living standards first, NATO’s common sanctions and New Cold War front would be broken. Italy and France might follow suit. That nightmare of European diplomatic independence made it urgent to take the anti-Russian sanctions out of the hands of democratic politics and settle matters by sabotaging the two pipelines. Despite being an act of violence, it has restored calm to international diplomatic relations between U.S. and German politicians. 

There is no more uncertainty about whether or not Europe will break away from U.S. New Cold War aims by restoring mutual trade and investment with Russia. That option is now out. The threat of Europe beaking away from the US/NATO trade and financial sanctions against Russia has been solved, seemingly for the foreseeable future, as Russia has announced that as the gas pressure falls in three of the four pipelines, the infusion of salt water will irreversibly corrode the pipes. (Tagesspiegel, September 28.) 

Where do the euro and dollar go from here?

Looking at how this trade “solution” will reshape the relationship between the U.S. dollar and the euro, one can understand why the seemingly obvious consequences of Germany, Italy and other European economies severing trade ties with Russia have not been discussed openly. The “sanctions debate” has been solved by a German and indeed Europe-wide economic crash. To Europe, the next decade will be a disaster. There may be recriminations against the price paid for letting its trade diplomacy be dictated by NATO, but there is nothing that it can do about it. Nobody (yet) expects it to join the Shanghai Cooperation Organization. What is expected is for its living standards to plunge.

Germany’s industrial exports were the major factor supporting the euro’s exchange rate. The great attraction to Germany in moving from the deutsche mark to the euro would avoid its export surplus from pushing up the D-mark’s exchange rate to a point where German products would be priced out of world markets. Expanding the currency to include Greece, Italy, Portugal, Spain and other countries running balance-of-payments deficit would prevent the currency from soaring. And that would protect the competitiveness of German industry.

After its introduction in 1999 at $1.12, the euro did indeed sink to $0.85 by July 2001, but recovered and indeed rose to $1.58 in April 2008. It has been drifting down steadily since then, and since February of this year the sanctions have driven the euro’s exchange rate below parity with the dollar to $0.97 this week. The major factor has been rising prices for imported gas and oil, and products such as aluminum and fertilizer requiring heavy energy inputs for their production. And as the euro’s exchange rate declines against the dollar, the cost of carrying its US-dollar debt – the normal condition for affiliates of U.S. multinationals – will rise, squeezing their profits.

This is not the kind of depression that “automatic stabilizers” can work “the magic of the marketplace” to restore economic balance. Energy dependency is structural. And the eurozone’s own economic rules limit its budget deficits to just 3% of GDP. This prevents its national governments supporting the economic by deficit spending. Higher energy and food prices – and dollar-debt service – will leave much less income to be spent on goods and services. 

It seems curious that the U.S. stock market soared – 500 points for the Dow Jones Industrial Average on Wednesday. Maybe it was simply the Plunge Protection Team intervening to try and reassure the world that everything was going to be all right. But economic reality raised its ugly head on Thursday, and the stock market gave back its phantom gains.

It is true that the end of German industrial competition with United States is ended on trade account. But on capital account, depreciation of the euro will reduce the value of U.S. investments in Europe and the dollar-value of any profits that these investments may still earn as the European economy shrinks. So reported earnings by U.S. multinationals will fall.

As a final kicker, Pepe Escobar pointed out on September 28 that “Germany is contractually obligated to purchase at least 40 billion cubic meters of Russian gas a year until 2030. … Gazprom is legally entitled to get paid even without shipping gas. That’s the spirit of a long-term contract. … Berlin does not get all the gas it needs but still needs to pay.” It looks like a long court battle before money will change hands – but Germany’s ability to pay will be steadily weakening.

For that matter, the ability of many countries’ ability to pay already is reaching the breaking point.

The effect of U.S. sanctions and New Cold War outside of Europe

International raw materials are still priced mainly in dollars, so the dollar’s rising exchange rate will raise import prices proportionally for most countries. This exchange-rate problem is intensified by the US/NATO sanctions forcing up world prices for gas, oil and grain. Many European and Global South countries already have reached the limit of their ability to service their dollar-denominated debts, and are still coping with the Covid pandemic. They cannot afford to import the energy and food that they need to live if they have to pay their foreign debts. The world economy is now exceeding its debt limits, so something has to give.

On Tuesday, September 27 when news of the Nord Stream gas attacks became known, U.S. Secretary of State Antony Blinken shed crocodile tears and said that attacking Russian pipelines was “in no one’s interest.” But if that really were the case, no one would have attacked the gas lines.

I have no doubt that U.S. strategists have a game plan for how to proceed from here, and to do so that indeed is in what the neocons claim to be in the U.S. interest – that of maintaining a unipolar neoliberalized and financialized global economy for as long as they can. 

They have long had a plan for countries that are unable to their foreign debts. The IMF will lend them the money, conditional upon the debtor country raising the foreign exchange to repay the (increasingly expensive) dollar loans by privatizing what remains of their public domain, natural-resource patrimony and other assets, mainly to U.S. financial investors and their allies.

Will it work? Or will debtor countries band together and work out ways to restore the seemingly lost world of affordable oil and gas prices, fertilizer prices, grain and other food prices, and metals or raw materials supplied by Russia, China and their allied Eurasian neighbors? 

That is the next great worry for U.S. global strategists. It seems less easy to solve than was done by the sabotage of Nord Stream 1 and 2. But the solution seems to be the usual U.S. approach: something military in nature, new color revolutions. The aim is to gain the same power over Global South and Eurasian countries that American diplomacy wielded over Germany and other European countries via NATO.

Unless an institutional alternative is created to the IMF, World Bank, International Court, World Trade Organization and the numerous UN agencies now biased by U.S. diplomats and their proxies, the coming decades will see the U.S. economic strategy of financial and military dominance unfold as Washington has planned.

The problem is that its plans for how the Ukraine war and anti-Russian sanctions have worked out so far have been just the reverse of what was announced. That may give some hope for the world’s future. The opposition and even contempt by U.S. diplomats to other countries acting in their own economic interest and social values is so strong that they are unwilling to think through just how these countries might develop their own alternative to the U.S. world plan.

The question is thus how successfully these other countries may develop their alternative new economic order, and how they can protect themselves from the fate that Europe has just imposed upon itself for the next decade.

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  1. Darthbobber

    I’m reminded of the term “Copenhagenization”, current back in the aftermath of the British actions against Denmark during the Napoleonic wars, when the Danes, with a significant fleet of their own, were interested in using it to enforce their rights as neutrals. The Brits sailed into Copenhagen harbor and destroyed that fleet. Danes were miffed, since they were at peace with Britain, but what were they going to do?

    1. digi_owl

      Brits not giving a rats ass about North Sea neutrality, surprise surprise.

      do wonder if they are more willing to lend some ammunition these days.

        1. logosApplied

          I acquired an illustrated, large, German old book. About the perfidious Albion. The book was published sometime after 1933, propaganda item. W. Putin might have use several examples from this book in his latest excellent exposes.

    2. Soredemos

      Pretty sure the actual British motivation was fear that ‘neutral’ Denmark would offer its fleet up to Napoleon.

      1. CalDre

        Just like the UK savages to murder and destroy because of the possibility someone might resist their endless aggression and unprovoked violence. Heck there may be just one or 2 countries on the planet these barbaric monsters haven’t invaded. Hopefully someone will soon sink their entire navy and these invaders will finally have to stay on their own island, in the abject misery of knowing they can’t mass murder, destroy and plunder the world as is their custom.

        1. Count Zero

          Really? Is this vicious and empty rant meant to contribute to understanding or debate…or to anything at all? Devoid of knowledge, devoid of thought. Get some help!

          1. CalDre

            Truth is not vicious, the British are vicious savages though.

            Devoid of knowledge? it’s full of knowledge and truth. You are probably British – so in addition to being the world’s most barbaric savages, you constantly spread malicious lies to accuse others of fabricated crimes or British crimes, so you can feel good about murdering them. Brits obviously love nothing more than murdering, destroying and plundering, 500 years of constant devotion to these pursuits prove there is a genetic disposition to Brits that makes them incompatible with civil behavior.

            Stay on your island you murderous savages.

            1. Perra Verde

              Oh don’t be so hyperbolically ridiculous. While true that the colonial mind set is barbaric, the average brit is no more vicious and/or murderous than anyone else.
              (OK, except for the football hooligan meatheads.)

            2. darkool

              The funny part is, Brits will say precisely the same things you’re saying, only about Yanks.
              “O wad a gift the giftie gie us
              To see oursels as ithers see us!”

              I’d say it’s a northern European thing, mostly, this compulsion toward piracy and pillage. King Leopold II comes to mind. And the Crusades.

          2. Martillo

            Pirate Rock is built on democide. Truly the evil that the anglozionazi hybrid has spawned is astounding. There has never been a collection of thugs more evil and more full of hubris than that of Pirate Rock and then the current abomination in Washing town.

        2. White Russian

          Nowadays the state of the British navy is pathetic. Case in point – HMS Prince of Wales, which couldn’t sail past the Isle of Wight before breaking down!

          I doubt it would take much to render their whole fleet inactive :D

      2. berit

        Denmark-Norway sided with Napoleon, went to war against Britain, against Sweden too, lost, forced to sede Norway to Sweden, which angered prominent Norwegians, who considered themselves as equal citizens under the Danish Crown. Angered commoners too, as the British blockade and bad harvests led to massive hunger and suffering – which in due course led up to hammering out the Norwegian Constitution of1814, election in 1905, by referendum, of a new monarch, the Danish prince Carl, named Haakon VII, married to the British princess Maud. Neutrality was declared at the start of both world wars, not respected by Britain, entering and mining Norwegian waters – April 9 1945, Narvik – to prevent Nazi-Germany doing what had been planned anyway. Since that war, no neutrality, firmly USA/NATO/Stoltenberg propagandized allied. Good grief. Thank you, NC, Yves, Lambert, commenters, for daily breaths of sanity/truth.

    3. Egidijus

      Next city to be used as a verb will be Shanghai. And we’ll see Olaf Scholz waking up with a huge hangover on the deck of USS and captain yelling at him, “Start to arbeit, you @@#$%^!” :)))

    4. S

      The Brits sailed into Copenhagen harbor and destroyed that fleet.

      Russian disinformation! It was in no one’s interest to destroy that fleet. The British Empire, renowned throughout the world for its kindness and humility, would never commit such a heinous deed. On the day the Danish fleet was destroyed, the British were there to protect it! Do you understand? They were trying to help! Unfortunately, the darn Russkies got the upper hand—all because the civilized nations of Europe simply couldn’t conceive of such a barbaric act as sinking a fleet of a neutral country and thus weren’t prepared for it. Anyway, the British are currently helping the Danes in their search for the culprit. It’s too soon to tell who did it. Probably Russkies. In any case, it was in no one’s interest to destroy that fleet.

      1. worldblee

        That’s well played and made me chuckle – Tony Blinkin would probably be proud of your words since he doesn’t understand sarcasm.

      2. Cato the Uncensored

        Lulz … now do the British sinking of the French fleet at Mers-el-Kébir in 1940.

        They do seem to have a history.

  2. Matthew G. Saroff

    I have maintained for some time that Germany is the predatory exporter fox in the metaphorical henhouse in the Euro Zone, and that much of the problem with the Euro Zone can be fixed by kicking Germany out of the Euro.

    Nice to see Mr. Hudson expressing the same views.

    One does wonder if the upcoming economic catastrophe will result in German hegemony over the EU ending.

    1. Mel

      I dunno. It had seemed to me that German manufactured goods were a big reason for spending Euros, hence a big reason for having Euros. True, Germany exploited this with its invidious policy of collecting all the Euros there were.
      Without Germany as a member, Eurozone would have to find Deutschmarks somewhere, at whatever cost.
      Prof. Hudson points out that, if non-Euro Germany insisted on selling, then they would be pressed to devalue the Deutschmark … but what if it was the Eurozone that insisted on buying?

      1. digi_owl

        The problem is that Germany has long, before the Euro even, been using wage suppression to make its exports cheaper than they perhaps should be.

        But before the Euro, other nations could respond by adjusting their exchange peg or similar.

        1. CBBB

          Yes this is something I never hear mentioned by commentators, Hudson included.
          Unfortunately it’s treated as some kind of mystery why Germany has decided to “kill its industry” by participating in sanctions or its just blamed on “out-of-touch, Anglophile elites”.
          What seems to go constantly unmentioned is that Europe and Germany especially chose long ago to pursue a mercantilist economic policy and the consequence of being a mercantilist is you have no independent foreign policy. The Europeans need Russian gas but they also need foreign (ie US) consumer demand to an insane degree.
          For all Germany’s industrial might it’s economy is NOT self-sustaining — it needs foreign demand it cannot generate domestic demand to a sufficient degree given current tax and spending policies.
          The fact that Germany spent the 2010s free riding off US and to an extent Chinese demand using austerity and wage suppression to keep exporters happy is just never mentioned by commentators like Hudson.

          With the US and Russia Germany is caught between a rock and hard place but it is totally the German’s fault. Their mercantilism was pointed at for years and they just laughed it off.

          1. Whiteylockmandoubled

            Can’t speak for commentators from other countries but in US-based media, the entire notion of German “wage suppression” is considered either ludicrous or else long overdue medicine for pampered workers.

            In recent years, you’d see occasional stories about Merkel painstakingly doing a tiny bit of what need to be done, but the entire US political class operates on the assumption that European workers are overpaid and luxuriate in almost comically generous welfare states.

    2. digi_owl

      Back when NC was new, i think there was a video posted of a German economist, formerly with their finance ministry, that voiced a similar take. And one that predated the Euro by decades.

      1. vao

        You are probably thinking about Heiner Flassbeck. He has been publicizing his position many times since, and videos of his talks can be easily found in Yo*T*be.

    3. greh804

      It was always going to end because of demographic change and structural shortcomings in preparing for the future in Germany. This has only accelerated that change so much, that no other countries will be able to step up and keep the EU afloat financially

    4. CalDre

      “German hegemony over the EU” – a joke, right? Germany is an occupied vassal of the Empire and has been since WW II. The EU itself is run by the same oligarchy that has run Europe for centuries/millenia.

      I would suspect you buy into the entire “democracy” sham but by claiming “German hegemony” at least you have shown you don’t buy into that fraud. But go a step deeper … There are many more layers to the onion.

  3. ambrit

    The reaction of the populations of Europe this winter, and especially next spring will tell the tale. ‘EuroSpring’ anyone?
    The example of YouTube removing a speech by the newly elected prime Minister of Italy shows some of the “game plan” for the near future for the Neo-liberal Dispensation. Doubling down on running a ‘managed’ Public Discourse seems to be the plan.
    Russia needs to look back at it’s own history and work from a page that did quite well a century ago and resurrect the Comintern.

    1. fresno dan


      from the article: What is expected is for its living standards to plunge.
      It seems to me that what will happen in Germany is not any different from the “deindustrialization” of the US and the willful moving of American jobs to China. And did the American political system do, or even was it, capable, of doing anything to stop it? And by capable, I don’t mean that economics is some force of nature that can’t be stopped, but that the choice offered by the 2 parties is really no choice at all – the jobs were going to China. The German politicians or elites, call them what you will, also offer the German people no choice (we are IN the anti Russia coalition), and they have decided that the suffering of the masses is irrelevant to their goals.

      1. Tom

        The jobs went to foreign slaves because the Labor Movement was hacked to death by anti-Union BigShot Labor Porkchoppers.

  4. dingusansich

    Stockholm syndrome may need a reboot as Berlin syndrome.

    The remark on the calming effect of taking cheap energy off the table reveals that the true “ne’er the twain will meet” is between Western leadership and the public it pretends to serve and protect, between the rhetoric of democracy and reality of imperial diktat foamed by manufactured consent.

    Garland Nixon improvs an entertaining take on the Nord Stream whodunit.

  5. Beachwalker

    How history repeats! Around 1903 Germany began building the Berlin-Bagdad railway, which far-sighted Anglo-Saxon “realists” saw as a threat to their hegemonic ambitions. So instead of finishing the railroad, they had a nice little diversion or fracas called WWI.

    1. Michael Hudson

      Yes, that catalytic role of the Baghdad railroad is what I was taught by Prof. Jolles (who translated the great German general Clausewitz) at U/Chicago in 1956.
      This is indeed the perfect parallel.

    2. Soredemos

      That seems like a pretty ludicrious stretch. They stopped a railroad by contriving a war eleven years later? Anyway, we know that no singular nation or individual started WW1. It wasn’t some grand plan. Real history is seldom a grand plan; it’s usually much dumber than that.

      1. digi_owl

        I think it was more that said railway had to go through the Balkans to get to Bagdad. So they turned the Balkans in to an endless political powder keg to stall progress. Except that in the end that keg ended up blowing up in the most spectacular fashion, kickstarting WW1.

        Blowback is a term after all.

        Just as the Germans how well it worked to smuggle Lenin into Russia.

      2. petergrfstrm

        Read Jim Macgregors and Gerry Docherty, Hidden History The secret orins of the first world war(2013) to get updated about the facts that there was indeed a well prepared 100% British plan for WWI by the British enabling the establishment launched by Cecil Rhodes
        And the sequel Prolonging the agony, how the angloamerican establishment deliberately extended WWI by three and a half years(2017/2018) in order to get updated also about how true history was buried by grabbing national archives and how Britain sometimes deliberately lost in order to manage the perception of Russia so they wouldnt make a separate peace with Germany.
        Perception management at the cost of a hundred thousand souls in rough numbers. Churchill and Kitchener saw it through.
        In addition to such detailed and revealing historical accounts there is the role of freemasonry and the fact that for a century anglosaxons held the most powerful positions.
        This meant all the difference and explains the worldwide unrest that Lord Henry Temple Palmerston was able to unleash.
        Edward VII, as the prince of Wales, from 1874 was the grand master of the mother lodge and from 1901 was the grand patriarch of freemasonry, with all masonic financiers being his subordinates.
        This in all likeliness means that his ultimatum to the bankers in 1907 was decisive and eliminated the alternative of win win and peaceful development with trade expanding on the continent out of reach for Britains navy.
        The establishment of the FED made it possible for the financiers to stay lojal to the anglosaxon establishment but this meant war was a necessary requirement.
        And there was more.
        Britain had prepared the ground by encouraging antijewish currents in Germany.
        It began from within Palmerston’s circle in the 1830s and was completed when Hitler rose to power a century later.
        This was in all likeliness deemed necessary to convince the financiers that they had no better alternative than to remain close to the British turned angloamerican empire.

        1. Paula

          I go up against “Perception management” daily among friends, family, church, and state and I come out the loser. Just today I was called a conspiracy theorist by some of my UU church members because I told them outright not to trust MSM and that digital currency may be implemented and to move their finances to a local bank that will not allow the taking of their finances.

          Most Americans don’t know history like I do, and not that I know all, but I am being educated by the comments on this and other sites. I am ordering all the books suggested in this link and will read them and bring them to church as well. Americans are notoriously deficient on actual history, and I am bent on rectifying that lack as much as I am able. It is not their fault. What they lack is what they have not been taught in public schools and how interesting why government sponsored public education exists in first place, but of course to promote their own narrative of history. Powerful stuff found on this website. Thank you.

    3. Paula

      Beachwalker: It is easy for me to believe your history, but please give a source. I will google it but google is so unreliable that when I put in things like “Berlin-Bagdad railway,” I get little or no information. Yes, I think it possible something in the DNA of anglo saxons makes them think themselves destined to rule the planet, let alone countries. We might begin with the myth of Jesus who is always displayed among anglos as white when, if he did exist, would have been impossible considering where he supposedly came from. Narrative, narrative, narrative. Too many believe the narratives of the anglo Saxon empire.

      1. Villa

        Just don’t use a Google. Use duck, duck, go as a search tool. The results will provide more alternative sources of information.

    1. JBird4049

      But for how long? I think that the Germans have far more control over their fate if they are willing to pay the price needed.

      As for the Elites, especially the American, being all in control, I am reminded of the Southern leadership pulled out of the Union once their dominance of the federal government was ending due to the Northern population growth. The Slavocracy and its supporters in the Northern elites including the banks and in government had slavery permanently and very profitably enmeshed in American society with the legal and legislative systems firmly in support using corrupt and violent means. Many people believed that the North would just let it happen with no violent opposition. To be fair, many people believed that the South would quickly cave. Historically, plenty of leaders thought that they were in complete control until they weren’t.

      So, I read all the comments by those much, much better informed than I, and I have to accept their judgement, but..

      No heat in winter. No money to buy food. Shortages of everything. Even in the de-industrialized, thoroughly corrupt, United States, food and heat has been readily available, but that is looking to change. If you have nothing left to lose, that is just another word for freedom, yes?

      It is one thing if this was unavoidable or was the result of invasion or bad weather, but it was not. So, while the short term (and probably correct) wisdom is that “they” have won, what happens next spring in 2023 once the acceptability and trust of the current system has gone away? As one economist likes to say the Hamptons are not a defensible position.

    2. CBBB

      Germany gave up control of its future and foreign policy when it decided to pursue mercantilist policies full force in the early 2000s. When 50% of your GDP is exports that means 50% of your economy is directly built on foreign demand and you there have NO independence and NO control. You require insane inputs of foreign demand to keep going.
      Germany was warned many times about this extreme imbalance but they simply clapped like seals and chortled “Wir sind Export Weltmeister!!!”

    3. Hugh Fowler

      One suspects the German politicians sacrificed their “independence” the moment they decided to power their export orientated industrial base mainly on Russian natural gas. They compounded that error by decisions such as shutting their nuclear power plants. The reality became apparent the moment Russia invaded the Ukraine and Putin started to “weaponise” the gas supply to try to gain diplomatic leverage. The truth is that the way things were set up they were either going to have dance to the Russian or the US/NATO puppet master. Germany’s energy vulnerability is nothing new as it was one of the factors driving German foreign policy before both of the 20th century World Wars

  6. The Rev Kev

    ‘Despite being an act of violence, it has restored calm to international diplomatic relations between U.S. and German politicians.’

    Yeah, the politicians may be happy but does anybody care much about ones like Habeck and van der Layen and Schulz? The scum at the top of this particular cauldron may be settled but there are some fierce currents starting to stir up below. Has anybody considered for example the Law of Unintended Consequences? Most people know who was responsible for this sabotage so how will this play out in the coming months in places like Germany alone? What if massive support swings behind the AfD or any party for that matter than does not bleat the Russiadidit line. What if some resentful hackers decide to spread the joy in the countries that initiated this attack? Will there be terrorist attacks? How much support will there be for the EU seeing the economic disaster they they have lead the continent into? Give me a cup of coffee and I could come up with a coupla dozen other possible consequences. That is why they talk about the Law of Unintended Consequences. And something so spectacular(ly stupid) will take years to have the consequences to play out. I mean, this is like burning down your neighbour’s grain silos so that he can’t compete with you when you go to the markets. You don’t do something like that without a price to pay down the track.

    1. Michael Hudson

      Re your last sentence, Kev, America LOVES Germany. “And love means never having to say you’re sorry.”

      1. Henry Moon Pie

        “And love means never having to say you’re sorry.”

        For the young whippersnappers who don’t get the reference, here’s a movie clip from the movie made from the book that was the source of the quote. And no, all Cliffies do not look like Ali MacGraw.


    2. anon02

      I think you mistakenly equate the German/EU bourgeoisie with the German/EU people. As Borell stated, their goal is to continue to be among those who rule the world. Throwing their own people under the bus is small price to pay to achieve that. The only hitch is that the “people” might trow them over, so here come the US to help. People, especially outside Europe, often make the mistake of imagining or expecting a split between the EU and the American elite. They are one and the same.That is why NATO won`t split; they are the military arm of the western bourgeoisie.

      1. Paula

        anono2: Same is true of a great deal of Americans, misled by corporate arm of MSM. US will and has already begun to throw their own people under the bus, only they do it slowly so they think we will not notice. And they are right; few Americans notice.

    3. Ghost in the Machine

      I think there will be serious unintended consequences too. It is obvious who initiated the attack. Maybe Poles or someone else carried it out, but I am pretty sure it was a US brainchild. I can imagine a suffering German population turning against the American soldiers stationed there for instance. I have heard Germany was a nice place to be stationed. Maybe not much longer.

    4. vao

      What if massive support swings behind the AfD or any party for that matter than does not bleat the Russiadidit line.

      Irrelevant. The gilets jaunes were ultimately defeated by relentless police and judicial brutality; the concessions granted by Macron were limited and have been swamped since by the consequences of the pandemic and the sanctions against Russia.

      Governments have been learning from the gilets jaunes events how to deal with massive popular movements, and have since geared up for that (also in terms of legal tools). I notice that the German police is already on the offensive against the AfD, raiding its headquarters.

      Will there be terrorist attacks?

      Irrelevant. Historically, no terrorist movement, be it the best organized and supported by foreign countries, ever represented a truly existential issue for governments. The Rote Armee Fraktion in Germany, Action Directe in France, Brigate Rosse in Italy, Cellules Communistes Combattantes in Belgium, ETA in Spain — they were all crushed.

      Nowadays, the security and surveillance apparatus is way more developed and capable than in the 1970s-1980s. For governments, terrorism will be an annoyance, not a peril. Just like Al Qaeda.

      How much support will there be for the EU seeing the economic disaster they they have lead the continent into?

      Irrelevant. Remember what happened in Greece, where there was a massive popular push against the EU? It was choked by the tentacular EU institutional framework that controls such vital economic elements as banking, money and budgets.

      If things go as planned, the EU will have even more power to thwart any opposition to its policies — e.g. with the end of unanimity rule for EU decisions, or the introduction of a “digital central bank currency”.

      Basically, you are presuming that “voice” will be the major reaction to the disaggregation of European economies. I do not see any chance of this having a transformatory impact — short of an actual pan-European revolution.

      I have the feeling that “exit” is actually what will happen — for instance: emigration to Canada and Australia, or to oil&gas producing countries; massive increase in moonlighting and black market; abandonment of legal recourses and official State structures in favour of mafia networks (already happening in Italy); rampant adoption of extra-European currencies in preference to an unremittingly devaluing Euro. Perhaps Russian-speaking minorities in the Baltic States and Wolgadeutsche in Germany will return to Russia. In short, people will give up on Europe as we know it.

      1. vao

        I forgot to say that “loyalty” is the last attitude that can be adopted — but the dwindling economic power of European countries will increasingly restrict the set of people whose loyalty can be rewarded by States. I expect those rewards to concentrate more and more on security services, and that will leave behind a large part of the middle classes (and ultimately the PMC).

      2. Peter Duncan

        >Historically, no terrorist movement, be it the best organized and supported by foreign countries, ever represented a truly existential issue for governments.

        Your understanding of the American Revolution needs some work.

        1. vao

          There was no American Revolution, but a War of Independence — similar to the various wars of Independence in Central and Southern America against Spain (these actually abolished slavery, so…)

          The fight was not based on terrorism — the assassination of British people or destroying official buildings was neither the predominant, nor the preferred, not even a frequent modus operandi; rather, the fight was predominanly traditional pitched battles and sieges by organized armies, and guerrilla warfare.

          The insurgents were not just supported by foreign powers; the foreign powers — France and Spain — were fighting for them, on the seas and on land.

          So what happened in Northern America during the last quarter of the 18th century is irrelevant in the present situation.

          As an aside, it is not the terrorism of the Socialist Revolutionaries and the Anarchists that overthrew the Tsarist regime — but a coup, followed by a bolchevik revolution (communists disapproved terrorism and were for organized mass actions to seize power), which eliminated the SR and anarchists.

          An undoubtedly terrorist organization that managed to establish a realm were the Tamil Tigers; they were eventually annihilated.

          Arguably, the FLN in Algeria ultimately won — but its (urban) terrorist arm with its proponents had been wiped out by 1958, leaving the (countryside) guerrilla branch to continue the fight against the French. Similarly, it is not the terrorist Irgun or Stern gangs that won the Israeli independence — but a Jewish militia army. Ireland is perhaps the only case where a terrorist organization achieved success, but even then guerrilla was a major component of the fight against the British. The exclusively terrorist movements in Northern Ireland, just like those in Spain (ETA, GRAPO), whittled away and ultimately had to settle without achieving their declared objectives.

          So no, terrorism in Europe will not endanger existing governments — just like it never endangered them in the past. It may be a costly, painful, frightening annoyance, but nothing existentially critical.

            1. Paula

              There’s no mention of the USA being the most powerful covert terrorist in the world, but I guess everyone on this site recognizes that and it doesn’t have to be stated?

          1. JBird4049

            There is often not a very clear divide between terrorism and guerrilla warfare with the only real difference being how much support is given by the general population. The tactics are often very much the same with terrorists, resistance, and armies often using them.

            I would suggest looking at the reactions of the local people. If even the victims shrug off the deaths as due to a war, then it will be a problem for the government no matter what the media says and what kind of repression that be applied. Moreover, if the police refuse to seek out the opposition either because they don’t want to die or agree with them, arguing that drones are going to easily solve the problem will be incorrect.

  7. digi_owl

    German politicians likely has a bit of an inferiority complex going on.

    After all, Germany as we know it was not unified into a nation until 1871.

    As such they are an upstart even from the perspective of USA, who had been going for nearly a century by that time.

    It’s claim of fame was it’s rapid industrialization, helped in part by lax copyright legislation that made access to engineering textbooks etc cheap.

  8. Carolinian

    Thanks as always. But perhaps one should caveat that the financial domination by the US is supported not so much by our military dominance as by the bluff of our military dominance. The US may have blown up a defenseless pipeline but taking on the Russian military is another matter. This may be the point that Putin is making with his invasion–calling Nato’s bluff. From what I read on this blog and elsewhere he seems to be succeeding.

    1. Michaelmas

      financial domination by the US is supported not so much by our military dominance as by the bluff of our military dominance.


      Tell me one war besides Grenada that the US has fought since WWII where it won and achieved its war aims

      1. Revenant

        If its aim was to remain in power, then it has succeeded to date.

        Wars are not public examinations. You don’t have to answer every question. You don’t even have to hand in the paper. You can set fire to it and the exam hall and declare yourself the winner if nobody is strong enough to stop you….

        1. juno mas

          …and since Russia is fighting on home turf it certainly appears they are “strong enough” militarily. And as a purveyor of essential natural resouce a coveted friend for China and others. (Gasoline is back to ~$7/gal. in Calif.)

        2. Kouros

          The thing is, nobody contested US’s power. The US just tried to remind everyone of its power and impose its will. And they succeeded in Granada and Panama. Everything else has been a mess and a strife and wanton destruction and killing, with no end in sight.

          It seems closer to reality that they might be reaping the storm that they have seeded in the form of a couple of Sarmat missiles heading to the continental US, east board and west board…

          1. Starry Gordon

            There is no reason to bomb the US at this time. It is true that the latest adventure is disturbing, but so far only Germany and those dependent on it, that is, the EU, are going to suffer, and we all know what Victoria Nuland said.

        3. Bsn

          “Wars” have turned into mere battles. You may win/lose the battle but lose the war. This will be interesting yet dangerous. The US will have trouble maintaining a fear inducing or dominating military because of soldiers being overweight, male/female hybrids, full of spike protein and intimidated by the spanking they are getting in Ukraine. The US will need many robots to replace actual soldiers.

    2. NotTimothyGeithner

      Part of me thinks the long term effects of propaganda are responsible. Western elites outside of actual logistics types see wonder weapons like the F35 and can only see striking with impunity anywhere at all times. Against guys in beat up Toyotas, this is true, but these elites really don’t grasp where the fighting is, where air bases are, how many planes we would need, and so forth.

      NATO would likely crush a hypothetical invasion of Poland due to forces, but unless Russia extends itself, it’s all wishful thinking on behalf of the Western imperialists. Deployed missiles in countries like Iran means the US can’t lob Tomahawks without risking retaliation or significant escalation. It scared Obama in Syria.

      1. fresno dan

        Against guys in beat up Toyotas, this is true
        You know you are my favorite. So maybe literally true, a F35 is immune from a Toyota, but not existentially true – the guys in Afghanistan won.
        What I think is that the premise may be backwards: NOT financial domination by the US is supported not so much by our military dominance as by the bluff of our military dominance
        BUT military domination by the US is supported not so much by our financial dominance as by the bluff of our financial dominance.
        What happens when country after country starts THINKING and realizing that dollar hegemony is making them poorer? For a long time, TINA, but now it looks like there may be other alternatives…

        1. Jams O'Donnel

          US weapons are generally designed for profit – not for effectiveness. See for example:- The F-22 – in Syria its usage capacity was reported as being one flight per week per plane, and it is being withdrawn from service. The ‘Littoral’ naval ships, which are literally falling apart and being scrapped. The F-35 which has very limited capability in comparison with other 3rd generation planes, has hundreds of ongoing problems and is still not certified for full use. The new carrier class which similarly has large scale problems with lifts and catapults. The Abrams tank which has performed very poorly when opposed by Afghan militias. The UK is in a similar position.

          This can be confirmed at ‘Military Watch Magazine’ website.

      1. Kouros

        What about Lyman? Let’s assume Ukraine Army takes Lyman, which is now part of Donetsk Oblast which is part of the Russian Federation. How many weeks or months will be until Russia is done beefing up its forces and brings the brunt of them upon Ukraine?

        And the brunt of its fire power on Ukrainian infrastructure, now that Ukraine has attacked Russia?

        1. KD

          The Duma hasn’t ratified the treaty yet, so not officially part of the Russian Federation. As far as what will happen when the full effects of mobilization come to bear, who knows? Not huge “success” at this time in Lyman, which is an important transport hub, and northern Lugansk is pretty wide open if you are passing through in a tank division. It would seem pretty embarrassing to Russian army–its not like the build up in the vicinity of Iyzum wasn’t noticed and commented on at the end of August–so they’ve had a month to get their act together. It doesn’t mean that the Russians won’t triumph in the end, but it certainly costs less in Russian lives if you don’t kill a bunch of soldiers taking territory, then kill them retreating, then kill more again re-taking it. Probably demoralizing as well.

          Also, looks like the Ukrainians are operating at night and that is impeding the Russian’s ability to target them with artillery and air support.

          1. Kouros

            Hopefully Russians will learn and adapt.

            Also, they are now unshackled from their self imposed legal bindings, so full steam ahead.

        2. Greg

          “Lyman is falling and will end Russian warfighting capability in Ukraine” is the current Ukrainian psyops line. Twitter and telegram is full of fresh faces with similar lines. It appears to be an attempt to lower Russian morale.

          Liman stopped being consequential to Russia once they moved their lines to the river. Not sure why they even still have troops there, unless its another “draw Ukrainian troops into the open” move.

          1. Bsn

            “Twitter and telegram is full of fresh faces with similar lines”. Exactly. I wonder who is promoting and installing all of these new faces? Can anyone spell BOT with three different letters? USA perhaps.?

    3. digi_owl

      Speaking of military dominance. I read recently that China has plans for no less than 8 carrier groups. I’m starting to wonder if i should take the time to learn Mandarin.

  9. spud

    you have to remember the free trade cult, is a multi-generational movement that is two hundred years in the making.

    these creatures will never give up. colonialism failed, they had a back up plan, fascism, fascism at the point of a gun failed, so now its fascism using economics, as that has been failing, its back to the gun.

    but the dim witted creatures free traded away their ability to innovate, so now cannibalism is part of the free trade cults mix, and europe will pay the price.

    i doubt that will work in the long run either.

    people wonder how this happened. carter was a bad president, a jerk, and should have paid a price for his assault on working americans, so should reagan.

    but both of them were not dangerous to americas democracy. the one that scared me came into power in 1993. a real bonifid died in the wool full blown fascist, willing to do what ever was necessary to further the goals of the free traders.

    attack and conquer other countries, no problems, kill millions to educate a country, no problems.

    sign over our technology, factories, skills, standard of living, no problems, its done. gut our sovereignty, no problems, its done, reverse the new deal and drown government in a tub, no problems, its done.

    this is the free traders last stand, colonialism and war did not work, so they will leverage this to the end, the leverage of course under minds their positions, but that is how free trade laissez faire economics works.

    wood ticks, mosquito’s and other types of parasites never worry about tomorrow, its right now that counts. in the end, the parasites feed themselves to death.

    1. Milton

      Free traders, neoliberals, neocons enforcing Chicago/Vienna school of though–whatever or whoever they are… Is a mostly sociopathic way of formulating society and its proponents are incapable of seeing an alternative way, for they, as is my view are not human. The following clip best encapsulates this school of thought.


  10. LawnDart

    Re; “Germany is contractually obligated to purchase at least 40 billion cubic meters of Russian gas a year until 2030. … Gazprom is legally entitled to get paid even without shipping gas. That’s the spirit of a long-term contract.

    Russia may receive up to $17 billion in compensation for undermining the Nord Stream-1/2 pipelines
    September 29, 2022

    …According to experts, both pipelines were insured, and operators will be able to count on huge compensation. The amount of 17 billion euros is called (today the euro and the US dollar are almost identical), but legal proceedings stand in the way. First of all, Nord Stream 2 cost $9.5 billion, while Nord Stream 1 cost $7.5 billion. Lawyers believe that currently it is not worth counting on payments, since there are too many parties interested in sabotage. First of all, the United States and Germany can refuse the proceedings, which means that it will be impossible to establish in court whether it was sabotage. Usually, such cases are sent to international arbitration, but even if it is possible to prove that sabotage was committed, Western insurance agencies may refuse to pay compensation to the Russian side at all.

    Representatives of the Russian Federation plan to participate in the trial, but so far it seems that the West has chosen to put the brakes on the case. Experts believe that a dangerous precedent has been set. In recent months, Western politicians are increasingly talking about the nuclear threat, but the reality is that there are no less painful injections in the direction of a potential enemy. As you know, today the ocean floor is dotted with cables connecting different countries using the World Wide Web. Until recently, pipelines and cables were considered untouchable, but things can change dramatically.

    Source: overclockers[dot]ru

    Any notion of compensation via courts would be a pipe-dream, as the lawyers have noted. Two world-powers have been directly injured by this act: Russia and Germany– Russia brused and Germany crippled. I don’t see how the current German government will survive once the citizens of that country get over their shock and realize what was done to them. And new generations of Germans have no direct experience of the Marshall Plan, or how USA assisted in the rebuilding of that country after WWII, so I’d be inclined that any favorable views that Germans have of USA could diminish over this Winter as well.

    As noted, Russia could easily “get back” at the West with acts of similar fashion, but “crossing that line” and “hitting below the belt” doesn’t seem their style. They may do nothing in response, and allow this act to stand as an example (with Germany’s plight being the example) to the world of what may happen if you partner with the West.

  11. John Wright

    Please correct “Victoria Newland” to “Victoria Nuland”.

    It will make it easier for those unfamiliar with her body of work to find information via an internet search

  12. Revenant

    Is the Druzhba pipeline still delivering oil to the Schwedt refinery in Germany? Its close cousins NS1 and NS2 have died and I just wonder how the rest of the family is doing…?

  13. .Tom

    I don’t understand this bit “And as the euro’s exchange rate declines against the dollar, the cost of carrying its US-dollar debt – the normal condition for affiliates of U.S. multinationals – will rise…”

    Does it refer to European firms that need to borrow USD to their business?

    1. djrichard

      I’m surmising that the logic must be that affilates of US companies in foreign countries don’t go to the local debt markets to raise capital. Instead they rely on the home company in the US going to the US debt markets and swapping that for the necessary foreign currency, to get the foreign affiliate stood up and for subsequent capital investments. That foreign affiliate is basically generating a yield on that investment. As the dollar gets stronger, that yield goes down. Compared to if they went to the local debt markets in the foreign countries to raise capital. And even then the yield goes down as they still need to repatriate profits back into the USD.

  14. Eureka Springs

    Why would Germans move industry to the U.S.? If we will choke um over there we would surely do it over here. Private equity immediately comes to mind. As for any EU country being dumb enough to step up to the IMF there’s no such things as society wood chipper, I suppose they might considering the level of lunacy demonstrated this year. Boggles the mind. So does remaining in NATO. And still, I don’t see how or where Germany, Italy and others get enough gas to stay warm and such. The shivering and hunger will continue until morale improves is not an acceptable TINA.

    As for all of this on the western front, there is no such thing as democracy. Nobody came close to presenting this grand scheme to any electorate for a vote. Quite the opposite.

    1. KD

      This is a great opportunity to be free of the shackles of social democracy once and for all, privatize the health care system, education systems, cut all the vacation time, break the unions turn it into the USA and cut taxes on capital gains and high income. What is not for elites to like?

      Perfect crisis, budget deficits, austerity, patriotic war effort. . plus, cheap villas for the super-wealthy and cheap assets for investors. Civil unrest? You have technology, mass surveillance, social media monopolies, education system, domestic infilitration by security services, all designed to keep people under tabs and politics within the rails. Hitler and Stalin would be jealous at the new and improved social control. Probably Soma is next.

    2. Phenix

      German and European firms will relocate to the US because American natural gas is cheap and plentiful. American labor is also cheaper.

      I really do not understand why Powell is increasing interest rates if one of the goals is to repatriate American manufacturing (or steak what you can)

      The US is a oil and petrochemical exporter now. Market shocks (Opec+ decreasing supply) do not hurt the US but it does hurt the US global system….empire.

      1. KD

        Because the purpose of the Fed is to the bidding of commercial banks, and they don’t care about manufacturing, they care about inflation turning their loan portfolios upside down.

  15. ex-PFC Chuck

    As prep for a presentation on the Ukraine SMO I gave to a discussion club I belong to I realized the so-called “Rules Based Order” is basically a rebranding of the Super Imperialism Dr. Hudson writes about in his 1972 book. That led me toward looking into the origins of the IMF and World Bank, which in turn turned up a sort-of biography of Harry Dexter White who was the USA’s chief negotiator at the Bretton Woods conference at which the two institutions were authorized, to be stood up after the war was over. The White book is entitled Treasonable Doubt: The Harry Dexter White Spy Case, by R. Bruce Craig.
    Craig asserts the de facto USA veto power enshrined in the charters of the two institutions was put there in order to prevent the European colonialist countries from using the institutions from using them to inhibit decolonialization after the war. The institutions were not finally stood up until January 1, 1946, and by that time Roosevelt had been dead for 8 months, Morgenthau had been out of office since the summer and White was losing influence. Also, by that time Truman’s mind was in the final stages of being captured by anti USSR hardliners. Although White was appointed as a USA member of the IMF board, he was disturbed about the extent it was being used in ways biased toward the USA instead of the impartial manner envisioned by Roosevelt, Morgenthau and himself during the preparations for the Bretton Woods conference. I haven’t yet found a source that describes the full story of how he lofty ambitions of the Bretton Woods conference were perverted into the regime for kicking the ladders to prosperity down that Dr. Hudson and John Perkins described respectively in Super Imperialism and Confessions of an Economic Hitman.

    1. Lester Arbusto

      The World Bank: A Critical History by Eric Toussaint. New edition to be published by Pluto in a few months. See cadtm.org.

  16. Dennis

    Dr. Hudson – is it possible that in fact the financial empire is preparing to stealthily move out of New York and back to Europe? Crash Germany then buy up all the hard assets, land and engineering expertise at rock bottom prices with soft cash created by the financial engineering and arbitrage that has occurred since the 2008 bailouts. Then let the American people either absorb the Fed balance sheet liabilities that have skyrocketed in the last 20 years, or just default now that they bought up all the real assets of Europe at rock bottom prices.

  17. Another Anon

    Scientists go where the money is, mostly not so much to get rich, but because it is essential for satisfying their curiosity. Fancy laboratories, observatories, research stations and field trips all require big bucks. I know, for I speak for myself and of the many colleagues I have known in the physical sciences.
    This research does lead once in a while to spectacular technological developments which will make a few scientists wealthy, but this is a relative rarity and few scientists orient their research for the goal of striking it rich.

    The digital camera you are holding in your hands, the smart phone in your pocket and the MRI machine at the medical center, are all based on quantum physics, a theory which was pretty much developed by the early 1930’s. Note also that all these technological advances happened decades later.

    The point of all this, is that even reasonably successful scientists are a mobile lot. When the laboratory gets cold, the power goes out ruining some experiment that required years of work, many will think, screw this, I am going to somewhere else. A place that has the money so I won’t have to worry about staying warm or my experiment getting ruined or not getting that new, super duper equipment which will make everything faster or better. It looks like Europe will no longer be one of those places and any resultant earth shaking technology will also come from elsewhere.

    The US and Japan have some of that money, but if the Chinese economy gets to be bigger than anyone’s else, then it might be that place. Already I have seen more and more Chinese research staff members with western names.

    For decades before the second world war, one needed to read German to keep up with the latest research. Afterwards, English became that language. Quite possibly, within a decade or two, it would be recommended that scientists learn Mandarin.

    In addition, international research may be harder to finance as Europe often plays an important role. For example, around 40 percent of the scientists involved withe the James Webb telescope are European. Then there is the CERN high energy physics facility. It is very international involving one way or another thousands of people, and it uses enough energy to power a smallish size city, what happens then when black outs make work impossible. I read that China wants to build a facility that is at least as powerful.

  18. Republicofscotland

    I foresee the rise of new anti-Nato European political parties in the future, but not until Europeans have suffered greatly, the Europeans have allowed the US to control their future via European politicians going along with US plans for Europe.

    For the time being costs will rise in Europe for food and energy, as will unemployment as many European firms close their doors or head out of Europe to manufacture elsewhere.

    Worse still Third-World countries will suffer the most, and Europe won’t be in a position to help them.

  19. Milton

    Dr Hudson. I’ve held asking but cannot wait any longer. I’ve read Forgive them their Debts Bronze Age… going on 3 times now. When is your volume 2 (antiquity to ??) going to be available? What you’ve touched on with this series is one of the most fascinating subjects I’ve read and can’t wait to get the ensuing volumes. Thanks in advance for your brilliance. (little overboard but you get the gist) :)

  20. Rodger Malcolm Mitchell

    In June 2005, Professor Randall Wray asked me to speak at the UMKC. The text of the speech can be summarized thus: “Because of the Euro, no euro nation can control its own money supply. The Euro is the worst economic idea since the recession-era Smoot-Hawley Tariff. The economies of European nations are doomed by the euro.”

    The euro nations voluntarily surrendered the single most valuable asset any government can have: Monetary Sovereignty. They have locked themselves into a perpetual fiscal crisis. They rely wholly on taxes, exports, and the mercy of the European Union, which itself is Monetarily Sovereign.

    But taxes punish the people, and not every nation can be a net exporter. And the EU demonstrates its mercy by lending euros to its nations rather than giving them, which it easily could and should.

    In this, the euro nations resemble the American states, which also are monetarily non-sovereign and rely on taxes, exports, and the mercy of the Monetarily Sovereign U.S. federal government.

    By contrast, England was wise enough to maintain its Monetary Sovereignty. It kept the pound. It can pay any debt denominated in pounds. It can create pounds at will. It never can run short of pounds.

    Sadly, the value of Monetary Sovereignty has not been learned even in America, Here, here politicians wring their hands about federal debt and deficits, both of which are easily affordable and in fact, necessary for economic growth.

    I’ve tried to impart that bit of knowledge for 25 years, as have my MMT friends. We’ve been singularly unsuccessful. Shortly, Congress again will debate about continuing to fund America, a classic case of the ignorant leading the blind.

    1. Judge Arrow

      >federal debt and deficits, both of which are easily affordable and in fact, necessary for economic growth<
      Oh you mean the easily affordable US 31 trillion (and hurray, rising exponentially) that will blossom economic growth by, uh, interest payments – or maybe that needn't be paid – and the States can issue their own Monetary Sovereignty and why stop there, Municipalities can do the same, we will have City-States and the Medici's in the form of Corporate crypto and soon local butchers will be issuing fiat. It's all just so simple if the ignorant would just get out of the way of the blind. Harpo, where are you?

  21. RobertC

    The question is thus how successfully these other countries may develop their alternative new economic order, and how they can protect themselves from the fate that Europe has just imposed upon itself for the next decade.

    Perhaps I misunderstand but I think Michael Hudson’s intended (desired) audience was a call to action by the “Global South and Eurasian countries.”

    It’s Which Side Are You On? time.

    Russia has committed and China is almost there but India probably won’t (and can’t). Africa seems to be learning quickly — I was heartened by Sudanese-British billionaire businessman Mo Ibrahim accused developed countries of hypocrisy in warning Africans against developing natural gas reserves while also eyeing such investments in response to the energy crisis in Europe.

    Don’t scab for the bosses
    Don’t listen to their lies
    Us poor folks haven’t got a chance
    Unless we organize

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