Tensions Rise in EU Deficit Battle

What is the difference between a turtle and the European economy? The turtle is moving fast forward. There are no lights in the tunnel either, especially when we take into consideration the situation in the big French economy. The socialist government came into power on promises to get the economy going, turn the tide on employment and get the austerity dementors from Brussels off the back of the French people. They have not delivered on a single one of their promises, and even though it takes time for new economic policies to sink in, the French socialist government is closing in on two years in office and should at least be able to produce some credible signs of recovery. But that is not the case. On the contrary, whatever blip on the radar they have been able to produce is succumbing under their tax increases and even more stifling regulatory incursions into the private sector:

GDP Growth French

The rather tepid growth record of the French economy is having a real impact on its government’s relations to Brussels. With the tax base (GDP) barely growing at half a percent per year, it is arithmetically impossible for the government in Paris to close its budget gap. As a result, Euractiv.co, reports:

France is again seeking an extension from the EU on the deadline to reduce its national deficit. European Parliament President Martin Schulz supports the idea but the German government is insisting on adherence to the guidelines of the European Stability Pact. EurActiv Germany reports. In a speech earlier this week, French President François Hollande made it clear he would attempt to renegotiate Brussels’ demands to reduce the French deficit to under 3% of GDP by 2015. The new finance minister, Michel Sapin, also intends to renegotiate the timeline with the European Commission. “The government will have to convince Europe that France’s contribution to competitiveness, to growth, must be taken into account with respect to our commitments,” Holland said on 31 March. But the EU has already given the country two extra years to comply with the Stability Pact’s deficit limit of 3% of GDP.

This is raising tensions over the Stability and Growth Pact, effectively the legal deficit-cap instrument in the EU constitution:

On Thursday (3 April) in Frankfurt, ECB President Mario Draghi again stressed how important it was for eurozone countries to honour their fiscal commitments within the EU. On Friday morning, European Parliament (EP) President Martin Schulz, spoke in favour of meeting French demands. Schulz is the European Socialists’ candidate in the upcoming European elections. Speaking on BFM-TV in France, he said the country must be given more time to comply with the Maastricht criteria. The rules of the Stability and Growth Pact, with its debt limit of 3% must “be reconsidered”, said Schulz. Norbert Barthle is Bundestag spokesman on budgetary policy for Merkel’s Christian Democratic Union (CDU). In his view, another postponement of the deadline should only take place under clear conditions which state that France will really put its budget back on course. The chairman of the Bavarian Christian Social Union (CSU) political group in the EP, Markus Ferber strongly criticised Schulz’s demands to soften the terms of the Stability and Growth Pact: “While the CDU and the CSU have been acting as a fire brigade to extinguish the euro debt-crisis, Martin Schulz is adding new fuel to the growing fire.”

Schulz is the socialist candidate for president of the EU Commission, with a strong statist agenda in his hand. His desire to water down the Stability and Growth Pact has nothing to do with concern for the French economy – it is primarily motivated by a desire to give government the room to grow without any real limits.

Secondarily, Schulz is vehemently against the austerity policies that the EU-ECB-IMF troika has been forcing on some EU states. I share his resistance, but for entirely different reasons. While Schulz sees austerity as an impediment on government growth, I view it – or at least its European iteration – as a macroeconomic poison pill. It is a good idea to stop austerity policies, but the replacement should absolutely not be more government. The French government is way too big, but this is also the case in Europe in general – which is why there is no recovery in sight. On the contrary, stagnation is the new normal. In the last quarter of 2013, industry activity in the EU-28 and euro-18 areas were as follows in key sectors, measured in gross value added (one of three ways of measuring GDP):

  • Manufacturing grew 1.7 percent over the same quarter in 2012; 1.3 percent in the euro area;
  • Construction declined 0.4 percent, the 11th quarter in a row with declining activity in this sector; in the euro area the decline was 1.7 percent, the 22nd negative quarter in a row!
  • Finance and insurance contracted 0.9 percent in EU-28, 1.1 percent in euro-18.

Measured as employment, the numbers do not look better:

  • Manufacturing employment contracted 0.7 percent in the fourth quarter of 2013, the eighth straight quarter with a decline; the decline was 1.2 percent in euro-18;
  • Construction saw employment shrink by 1.4 percent, the 22nd straight negative quarter; the decline was a notable 2.9 percent in euro-18, marking the 23rd quarter in a row with declining construction employment;
  • The financial-insurance industry basically stood still at +0.1 percent (-0.3 percent in euro-18).

(All numbers are from Eurostat.)

Things may turn around when we get the numbers from Q1 of 2014, but I see no substantial reason to expect a sustained recovery. On the contrary, everything points to continued stagnation, in France as well as in Europe. This does not bode well for the future of the continent – perhaps the EuropeanS should get used to scenes like this one:


Nazis Strike in Sweden

The liberal welfare-state paradise is crumbling. My Fox New York has yet another glimpse of the destruction under way:

Swedish police detained 28 people Sunday after a group of neo-Nazis attacked an anti-Nazism demonstration in a Stockholm suburb by hurling bottles, torches and firecrackers. Two people were hospitalized and a policeman was injured in the back after being hit by a heavy object, police spokesman Sven-Erik Olsson said. Olsson said around 200 people participated in the planned, peaceful demonstration in the suburb of Karrtorp when they were attacked by a smaller group of about 40.

The “smaller group” consisted entirely of members of an openly Nazi group called Swedish Resistance Movement. It is a dangerous, militant organization that does not shy away from violence. On the contrary, they have demonstrated on many occasions that they are not only ready to use violence but also train for violence-based tactics. On previous occasions when they have resorted to violence, it has been at their own public rallies, in response to provocations from radical leftists, and their response has always been well coordinated and intimidating.

However, this is the first time they have actively sought out their opponents’ public event and launched an attack. My Fox NY again:

Those detained are suspected of rioting and various assault charges. The demonstration was organized by a local citizen group as a protest against increased neo-Nazi campaigning in the area. Video footage published by state broadcaster SVT showed families with baby carriages escaping the scene as firecrackers exploded in the middle of the crowd and people were heard screaming. Later, the crowd moved toward the attackers chanting anti-Nazism slogans and forcing them to retreat. A neo-Nazi group called the Swedish Resistance Movement claimed responsibility for the attack on its website.

For more of the real picture of a Sweden in decline, check out my other articles on Sweden or go to Dispatch International.

Sweden: The Raw Image

Europe is, as we know, stuck in an economic crisis that is increasingly looking like a permanent crisis – a new normal. On top of that, there are more and more signs of deeper social disintegration, including rising tensions between Europeans and immigrants. Contrary to common sense, many political leaders in Europe are actively promoting high levels of immigration in the midst of a deep economic crisis. While there is a growing resistance to these policies in many countries, there is one place where immigration is basically spinning out of control, namely Sweden.

Over the past decade immigration levels in Sweden have hovered around 50-60,000 per year, and that counts only the inflow of people of workforce age. For most of the past ten years immigration has exceeded the number of new jobs created in the economy, leaving us with one important clue as to why Sweden currently has a youth unemployment rate of 26 percent (as reported by Eurostat). This is ten percentage points higher than, e.g., the United States.

As a libertarian I am strongly in favor of cross-border migration – it is an essential part of individual and economic freedom. However, when governments restrict, regulate and interfere with the economy to the extent they do in Europe, it becomes socially and economically problematic to allow people to move as they please. The most acute problem is the massive system of entitlements provided by welfare states in Europe: when there are no jobs to come look for (as evidenced by the high unemployment rates and paltry job-creation numbers from across the EU) immigrants come for entitlements.

From an economics viewpoint this is entirely rational: if you can live better on work-free income in country X than on income from work in country Y, then why would you choose to remain in country Y? However, this reasoning excludes the broader consequences of immigration based on entitlements. Since people do not have to work to live, their incentives to integrate and assimilate with the prevailing culture are weak. This paves the way for parallel-culture societies where the norm systems of minorities become just as established as the norm systems of the majority culture. It is inevitable that this leads to conflicts and clashes.

Such conflicts would be manageable if immigration levels were reasonable. But it is virtually self evident that immigration levels such as Sweden is currently experiencing are exacerbating conflicts; imagine 50-60,000 workforce-aged immigrants coming to New Jersey each year, bringing just as many family members; imagine there were no jobs for them and that most of them ended up living on welfare. Imagine this going on year in and year out for a decade.

It would inevitably create socially explosive tensions between various groups of Jerseyites.

However, there is one more ingredient to the Swedish immigration problem. According to several leaks from the government agency responsible for immigration, up to 90 percent of immigrants have no papers as they get to the Swedish border.

Yes, up to 90 percent. Despite this, the vast majority are given residence status. Currently every Syrian – or, rather, every person who claims to be from Syria – who can make it to Sweden is given permanent residence status!

This unimaginably naive, not to say reckless, immigration policy is a recipe for enormous social tensions, conflicts and confrontations. The lack of background checks opens the Swedish borders to criminals, terrorists and people who are no longer wanted in their own countries. Needless to say, this builds up to a destructive situation that threatens the very survival of Sweden as a country. A recent report in Dispatch International offers a great insight into this enormous problem:

In 1975 the Swedish parliament unanimously decided to turn homogenous Sweden into a multicultural society. Thirty-eight years on the dramatic consequences have become apparent. Whereas the population has grown by 16.2 percent, violent crime has gone up by 320 percent.

A note of caution. The spike in crime began before the current levels of immigration. The deep, destructive economic crisis in the ’90s brought with it a surge in various types of crime. As immigration accelerated after the turn of the Millennium, there was yet another rise in crime rates.

In other words, not all of Sweden’s crime problem has to do with immigration, but the relation that DI points to is definitely present in the statistics. And the situation is getting worse as anonymous immigration continues from, e.g., war-torn Syria – yet Swedish authorities are doing their best to ignore or even deny the problem:

Every week we read in the mainstream media about murders, robberies, rapes and other serious crimes. Nevertheless criminologists insist that there is no increase in crime. In fact, they maintain that it is subsiding. But from the homepage of the Council for Crime Prevention (Brottsförebyggande Rådet, Brå) you can generate your own statistics on the number of reported crimes. Interestingly, the statistics start in 1975. If one looks at the whole period from 1975 to 2012, a completely different picture emerges than the one we are usually presented with. It turns out that the criminologists are lying and that the number of violent crimes has not only increased but completely exploded. But Brå doesn’t feel like discussing these figures.

You got this right. The government agency in charge of researching crime, the Council for Crime Prevention, is actively participating in a campaign to blur, sometimes outright distort, crime statistics. I have myself interacted with officials of the council, with the exact same experience as DI reports:

Statistician Anton Fernström tells Dispatch International that it is not enough to look at the statistics; they must be ”interpreted”. One must compare the number of reported crimes to what people answer when asked by the National Survey of [Safety] (Nationella Trygghetsundersökningen, NTU) what crimes they have been exposed to and in addition consider that people’s propensity for reporting crime has gone up.

The last point is actually a staple of the council’s “research”. Every time they get a chance to, they claim that the reason why crime rates are as high as they are in Sweden is that Swedes, for some reason, have started reporting crimes in droves over the past 6-8 years. Yet there is not a shred of evidence – not a single research paper or opinion poll or any other piece of information – that crime reporting has gone up in Sweden. On the contrary, with major cuts in police presence and interaction with the public, it is entirely plausible that crime reporting has fallen.

Anyone prone to rely on common sense would ask at this point why on God’s green Earth a government agency in a supposedly democratic country would resort to such recklessly deceptive behavior. The frustrating problem is that there is no other explanation than a long tradition of government culture, uniquely Swedish in many ways, that has been fostered by three generations of politicians and bureaucrats. In a way, you could think of it as Sweden trying to live up to an un-attainable self image.

DI again:

But the fact remains that however one ”interprets” the figures, the number of reported crimes has increased dramatically. … If we assume that the statistic actually reflects a real increase, we must ask why. Have Swedes in general become extremely more violent and criminal or have immigrants brought with them a violent and criminal culture? The latest survey of crime among Swedes and immigrants (from 2005) shows a general overrepresentation of people born outside the country by 2.5. The number is even higher when one looks at serious crime: Concerning deadly violence, the overrepresentation was 4.2 and the same was true for attempted murder or manslaughter. For rape or attempted rape, it was as high as 5.0.

As troubling as these numbers are, there is no denying the grave message they convey. A country simply cannot permit more immigration than it can assimilate – and you certainly do not allow immigration levels that add 1-1.5 percent to your workforce every year when there are no jobs. It does not matter if you are a dedicated libertarian, as I am, and thus for the free mobility of people – your principles cannot change the fact that immigration that piles onto unemployment is socially and economically destructive.

The lack of jobs in Sweden, combined with unchecked identities allowing droves of criminals into the country, could explain the troubling trend of a rising share of immigrants:

These figures don’t tell us much about immigrants’ share of criminals. But numbers from Statistics Denmark for 2011 indicate that two-thirds of those arraigned in court were of foreign extraction – and that the percentage had been going up for the previous five years. For juvenile delinquents, 15-17 years, it was even worse. In this category three-quarters had a foreign background with a clear overrepresentation by second-generation immigrants from non-Western countries.

DI also mentions Sweden’s horrifying rape statistics, pointing to the internationally well established fact that Sweden is one of the world’s worst countries when it comes to sexual violence against women. The article concludes:

Based on Brå’s own statistics, one cannot avoid the conclusion that Sweden has become much more violent and dangerous than before parliament decided to transform us into a multicultural society.

Again, this trend started during the economic crisis of the ’90s, before the mass immigration that Dispatch International refers to. However, the large waves of immigrants correlate well with the second surge in crime in the 2000s; one statistic often mentioned at the time was that the number of violent crime victims at the ERs in big cities increased by 75-90 percent from 2000 to 2010. The geographic proliferation of no-go areas is also very disturbing – when I grew up in Sweden back in the ’70s the phenomenon was unknown. It slowly emerged during the ’90s: from 1991 to 1993 I lived in the housing project of Rinkeby in north-west Stockholm; only five years later the place was de facto a no-go zone for ethnic Swedes, especially those who did not live there. Today I would risk my life if I went there.

Today, Sweden surpasses the United States in almost every violent crime category. The only reason why there seems to be a higher murder rate in the United States is prosecutorial: Swedish law enforcement authorities are much more prone to prosecute at a lower level – manslaughter or lower – or even drop charges, than their U.S. peers.

I would warn anyone considering a visit to Sweden to be cautious and careful where you go, and when, in the same way as people were in pre-Giuliani New York or in London, Sao Paulo or any other big city in the world that is or has been plagued by high crime rates. The difference is that in Sweden, this is no longer a trend isolated to the big cities. It is relentlessly spreading to all corners of the country.

The High-Risk Greek Nazi Crackdown

Nobody in his right mind wants Nazis to have a say in how a country is governed. Despite all its flaws and failures, the (Western) European parliamentary system has been good at keeping Nazis out of legislative influence over the past six or so decades. However, thanks to the current, depression-style economic crisis popular faith in the parliamentary system has suffered, especially in very hard-hit southern European countries. In Greece, of course, this led to the rise of the Golden Dawn Nazi party, and 2012 marked the first year since the Third Reich when Nazis once again set their feet in the halls of a European parliament.

For a while, Golden Dawn showed some restraint and did not overtly behave like Nazis. There have been scattered reports of them harassing illegal immigrants and engaging in confrontations with Communists. But it has been hard to distinguish the two groups since European Communists – who by the way have held parliamentary representation in almost every Western European country since World War II – themselves are prone to extra-parliamentary, violent behavior.

Needless to say, none of this excuses any violence committed by any member of the Golden Dawn, especially if it is in the name of his party’s ideology. But this does not seem to concern the Greek Nazis, whose penchant for street-level violence seems to be growing stronger. The EU Observer reports:

Greek officials are considering banning the ultra-nationalist Golden Dawn party after a member is said to have fatally stabbed a prominent left-wing musician at an anti-fascist rally in Athens. Greek public order minister Nikos Dendias told reporters in Athens on Wednesday (18 September) that the government would table emergency legislation seeking to outlaw the group, reports the Guardian. … Dozens of Golden Dawn members chased the 34-year old musician, Pavlos Fyssas, and his friends, from a cafe late on Tuesday evening. Fyssas was then stabbed in the chest, sparking anti-Golden Party demonstrations throughout Athens the next day. Witnesses of the attack said it appeared to be premeditated because the killer suddenly emerged from a vehicle during the assault.

This would essentially mean that Golden Dawn would have to meet the equivalent of American RICO standards, namely that the organization itself can only exist if its members commit crimes on a continuous bases. If that is so, then it makes sense to outlaw Golden Dawn. However, that is unlikely to stop the violence, especially since there is widespread problem in Greece with politically motivated violence from socialist groups, exemplified by the deadly firebombing of the Marfin Bank in 2010 and the Athens Mall bombing in January of this year. None of the leftist groups that carry out terror attacks on almost a regular basis in Greece is, after all, legal.

Furthermore, it is fair to question what Golden Dawn activists and voters will do if their party is abandoned. Evidently, their ideas, beliefs and ambitions have been solidified to such a degree that they can form a presence both in the Greek parliament and in Greek society overall. The EU Observer again:

Prime Minister Antonis Samaras and socialist Pasok party leader Evangelos Venizelos are said to have convened a special meeting to discuss how to strip the party of its influence and voter appeal … the leaders want the government to adopt a two-pronged approach using criminal law to help dismantle the group and techniques to efface its popular “anti-system” image among supporters. … The party, which saw members voted into the parliament in June, has been known to use violence and intimidation against those critical of its views. Last week, a group of 50-or-so Golden Dawn activists also used iron bars to beat up Communist party campaigners putting up posters in the Greek capital.

According to the EU Observer, Golden Dawn is the third largest party in Greece now (they came in fifth in the June 2012 election). This is ostensibly based on opinion polls, and if this is indeed true, the Greek government has a formidable task on its hands. Furthermore, Golden Dawn seems to have strong support among the ranks of the military and the police, and although there are allegations that the party has infiltrated the police, that may very well have happened with the tacit approval from the top of the police hierarchy.

Any action by the legitimately elected prime minister and his cabinet against the Golden Dawn would be morally right, given the party’s ideology and proneness to violence, but it would only make sense if they took similar actions against leftist groups whose long streak of political terrorism dwarfs what Golden Dawn has done thus far. If the issue is politically motivated violence to promote a totalitarian ideology – a worthy reason to act – then it has to be consistent across the board. Otherwise the Greek parliamentary democracy is in grave danger.

That said, the clock might have run out on Greek democracy anyway. If Golden Dawn indeed enjoys strong support among military and police, it is not inconceivable that they may bet on seizing power on a wave of anti-EU, anti-austerity sentiments. That would be disastrous, especially if the result would be a Nazi-leaning dictatorship. But as with the perennial economic crisis in Greece, which has carved away one quarter of the nation’s GDP and put its prosperity beyond rescue, it is entirely possible that the train to save Greece’s democracy has already left the station.

I pray to God I’m wrong. The Greek people has suffered enough already. But if I am right, then may this modern Greek tragedy be an alarming wake-up call for leaders of all welfare states: when the current economic crisis reaches the Greek boiling point, you must choose between the welfare state and democracy. You cannot have both.

Portugal in Peril

As those Europeans who still have a job return after their summer vacation, they find a news feed that increasingly looks like it did before the summer – and last fall, and the spring before that…

In short: the European crisis continues. Today we get an update from deeply troubled Portugal, courtesy of EUBusiness.com:

Portugal’s creditors arrived back in Lisbon Monday to assess the country’s progress under its 78-billion-euro bailout as Brussels signals it will not cede to a request for the country’s fiscal targets to be relaxed. Payments of the next tranche of bailout loans to Lisbon will depend on a successful review by Portugal’s “troika” of lenders — the International Monetary Fund, the European Commission and the European Central Bank — of its progress in implementing economic reforms agreed in exchange for the financial aid.

“Reforms” is a code word for draconian tax hikes and panic-driven spending cuts that are facing fierce legal challenges all the way up to the Portuguese Supreme Court. The higher taxes obviously won’t help the economy one iota – on the contrary, they add extra weight to the private sector and will very likely put the Portuguese GDP growth rate well below Eurostat’s predicted 0.9 percent, on average, for 2013 and 2014.

The efforts to cut spending are obviously failing under legal challenges. This tells us two things: they were ill designed and they were forced through under sheer fiscal panic. Cutting government spending is a very good idea, but it has to be done right. In addition to avoiding legal challenges, the cuts must be structural in kind and designed so that they easily and quickly let private entrepreneurs step in and replace terminated government programs. None of this has happened in Portugal, primarily because the Eurocrats pushing the Portuguese government into destructive austerity are not interested in structurally sound reforms. All they want to do is preserve the welfare state and make it fit a smaller, tighter tax base.

So long as the same motives are behind the same austerity measures, we should not expect any change in the outlook for the Portuguese economy. The big question is what happens next year when the current bailout program ends. It is very unlikely that Portugal has even come close to meeting the budgetary requirements under the current bailout program. As the EU Business article hints at, this may lead to a new bailout program in 2014:

The rescue programme is scheduled to expire in mid-2014. Portugal is struggling to meet its deficit target of 5.5 percent of gross domestic product for this year as government reforms aimed at streamlining the government repeatedly get bogged down by legal challenges. Portugal’s Constitutional Court last month struck down a reform allowing civil servants to be laid off if they fail to requalify for a new job. It was the third time that the court has restricted the scope of a government austerity measure. The ruling has helped push Portugal borrowing costs to levels near which it was forced to seek international aid two years ago. The yield on Portuguese government 10-year bonds stood at 7.4 percent on Monday.

This is the level that caused utter panic in Greece and Spain. And so for good reasons: if Portugal had to refinance its entire government debt at 7.4 percent interest, at the current debt level, then its annual payments on its debt would be equal to 9.1 percent of the country’s GDP!

This is not a road to serfdom. It is worse than that. This level of uncontrollable government paves the way to political chaos, economic instability, social turmoil and very likely the destruction of Portugal as a parliamentary democracy.

That point is closer in time than most people think. EU Business again:

Deputy Prime Minister Paulo Portas last week urged Portugal’s international lenders to ease its 2014 public deficit reduction target from 4.0 percent to 4.5 percent of GDP. The appeal got a cool response from Brussels, with the head of eurozone finance ministers, Dutch Finance Minister Jeroen Dijsselbloem, saying Lisbon should stick to the deficit reduction targets already agreed. … “Someone has to explain to us how we are going to be able to go from a deficit of 5.5 percent in 2013 to a deficit of 4.0 percent in 2014. We have never seen such a strong reduction in the deficit,” said Antonio Saraiva, the head of the Portuguese Industry Confederation, after meeting with Portas on Monday.

Since legal challenges successfully prohibit or reduce the amount of spending cuts, there is a growing risk that the Portuguese government will choose to rely on tax hikes instead. Tax increases earlier this year have already robbed Portugal’s taxpayers of a month’s salary, on average, in part through a rise in income taxes from 24.5 to 28.5 percent. More tax hikes would plunge the country’s economy into a full-blown depression.

Perhaps the current prime minister, Mr. Coelho, is aware of this. This would explain why he tries to push yet more austerity measures on the economy, including, EU Business reports…

an average 10 percent cut in the pensions of most government workers, which have been loudly opposed by unions.

Imagine the federal government slashing Social Security payments by ten percent across the board. That alone would be unthinkable in the United States, yet unless we start getting serious – very serious – about the federal debt, we are heading in that direction.

As for Portugal, the future is very uncertain except for one thing:  we can surely expect the country’s tumultuous political climate to remain. Radical leftist parties hold a larger share of the parliamentary seats in Portugal than in most other European countries. Their strong presence in the legislature is a formidable hindrance to any effort at rolling back government, eliminating entitlements and massive tax cuts. As a result, political instability, economic decline and social stress will continue to escalate.

What will this lead to? I have said it before, and I will say it again – the one word that captures Europe’s fatal decline:


Greece and the Perpetual Crisis

After years and years of bone-crushing austerity; after having lost 25 percent of its GDP; with six out of ten young and three out of ten of all workers unemployed; you’d think Greece would be out of its crisis, right? That is, if austerity was the right kind of medicine for their crisis.

That is a pretty big “if”, and it grows bigger for every year. As I have reported repeatedly, austerity is not the right medicine for the European crisis in general, and certainly not the right remedy for Greece. It has now been five years since the crisis broke out, and nowhere in Europe has a government been more devoted to spending cuts and tax hikes than in Greece (with the exception, perhaps, of Sweden in the ’90s). Alas, as the English-speaking Greek news site Ekathimerini reports, the result is a still-uncontrollable budget deficit:

Greece will not be able to return to bond markets next year to help plug an estimated 11-billion-euro financing gap that will start to open up, market sources said this week, contrary to earlier suggestions from the government and its European partners.

Greece has not been able to sell its treasury bonds on the open market for a long time. Its bonds were tossed on the financial junk yard more than a year ago when the country de facto – though not formally – went into bankruptcy. The EU-IMF-ECB troika rescued the Greek government with cash loans and demanded a continuation of austerity. They believed that such measures would reassure the bond market enough to let Greece return as a credible borrower.

The problem is that Greece has not accomplished any of the objectives sought by means of austerity:

  • GDP growth forecast, adjusted for inflation, for 2013 and 3014 is -1.2 percent and -0.4 percent, respectively;
  • Private consumption is expected to decline by the same numbers;
  • From 2009 to 2012, government revenue increased as share of GDP from 38 to 45 percent of GDP, yet during the same time government spending has remained at 54-55 percent of GDP;
  • In 2012 the Greek budget deficit was at ten percent of GDP for the third year in a row.

The fact that Greece has not seen a decline in government spending as share of GDP is sometimes taken as an indicator that they have not made any serious efforts at cutting spending. But they have, as data for government consumption shows. Here are the changes in percent, adjusted for inflation, in government consumption from 2010, including forecasts for 2013 and 2014:

2010 2011 2012 2013 2014
Greece -6.0 -6.2 -1.6 -2.6 -1.3

There are two reasons why, despite these numbers, government spending does not fall as a share of GDP. The first is plain macroeconomics: even though government spending is the most inefficient way to get anything done in our economy, it is an indisputable fact that government-funded hospitals, schools and other services do produce some services. When we cut those services we also cut the number of people on payroll, the purchases of inputs (think medical instruments for hospitals and food for school cafeterias) and spending on other, related items.  These cuts are felt, especially by local economies, where small businesses lose some demand and thus have to shrink their activities.

The second and more important reason is that the other part of government spending, namely financial transactions (welfare, unemployment benefits and similar income-security items), actually increases when the economy is in a decline phase. As people lose their jobs they go from being paid for work to being paid not to work. People who are paid for work, whether private or public employees, spend money in their local communities, pay taxes on their consumption and property, etc. Unemployed people spend a lot less (unless unemployment benefits cover 100 percent of your previous income which I don’t think is the case anywhere in the free world) and typically pay no income taxes on the benefits they receive.

In other words, as unemployment goes up government has to spend more money through its cash entitlement programs. This is one big reason why the Greek government is unable to close its budget deficit. It is also a major reason why there is again, as Ekathimerini reports, rising desperation in Europe over the black hole also known as the Greek government budget:

With pressure mounting on eurozone officials to find a solution to the 4.4-billion-euro shortfall the International Monetary Fund projects will kick in from August 2014, and widen by a further 6.5 billion euros in 2015, more debt relief now seems all but inevitable for Athens. “The troika will not likely be able to avoid new bailout discussions before the end of 2014 in order to plug the gaps, and is very likely to decide on an extension,” said Barclays in a research note. “We do not see how Greece could possibly return to the markets next year, even if recent developments have been very positive.”

Again: the troika has failed in achieving any of the objectives behind its relentless austerity policies.

As if to highlight the desperation mounting over the Greek economy:

European Union officials – who believe the size of the gap next year is somewhat smaller at 3.8 billion euros – see the issuance of short-term bonds as an option to make up the shortfall, alongside utilizing unused funds earmarked for the country’s bank recapitalizations and/or new loans. Bankers, however, say the country will struggle to convince investors to buy its bonds, especially given that further restructurings are not out of the question.

By “restructuring” they mean debt write-downs. Or, in plain English: the borrower unilaterally declares that today he owes his creditors less than he did yesterday.

But the threat of a new debt write-down is not the only problem in the way of utilizing the bank recapitalization funds. Many Greek banks are not in a shape to absorb the loss of recapitalization funds, and the reason has to do with the country’s terrible real-estate market. Behold another article at Ekathimerini:

Government and opposition MPs have reacted to suggestions that the coalition is considering lifting the restrictions on the repossession and auctioning of people’s main residence if they are not able to keep up mortgage repayments. Repossessions have been suspended in Greece since 2008. It is thought that the sale of some 200,000 homes has been prevented so far.

That is 200,000 homes that banks have invested money in – money that they in turn borrowed from someone. While the banks have to pay their loans back, mortgage defaulters are not paying them, and when the banks are prevented from selling the defaulters’ houses they lose big money. The banks, which lost enormous amounts on the government debt write-down, are slowly but steadily bleeding to death. Without recapitalization and without access to its assets on the real estate market they will inevitably go the way Titanic did.

As Ekathimerini explains, there seems to be little understanding of the exceptional consequences of a full-scale bank collapse in Greece:

Deputy Development Minister Thanasis Skordas suggested on Thursday that there could be a partial lifting on the ban from next year … New Democracy MP Sofia Voultepsi said there was no way she would discuss the auctioning of reposed [sic] homes. [Social Democrat party] PASOK deputy Paris Koukoulopous said Parliament would never accept such a measure. Opposition parties also raised concerns about the possibility of such a measure being introduced.

Long story short, the situation in Greece is as bad as it has ever been during the current economic crisis. The EU has failed to provide adequate help, the Greek governmetn is on i ts last straw of popular credibility and the banking sector is destined for collapse.

So long as Greece remains in the EU and the euro zone its government will be forced to continue to depress the economy with the same kind of measures that have turned the country into an economic wasteland. So long it continues with its austerity policies, the Greek government is undermining the last few pillars of support among the Greek people for the parliamentary system of government. Last year four in ten voters supported more or less totalitarian parties, which opens a frightening perspective on what may very well happen if the country does not very soon regain its fiscal and monetary freedom.

Europe and Its Young at Drift

Look at these unemployment rates for young Europeans in 2012:

Country 2012 Hungary 28.1
Greece 55.3 Cyprus 27.8
Spain 53.2 Poland 26.5
Croatia 43.0 Lithuania 26.4
Portugal 37.7 France 24.3
Italy 35.3 Sweden 23.7
Slovakia 34.0 Romania 22.7
Ireland 30.4 United Kingdom 21.0
Latvia 28.4 Estonia 20.9
Bulgaria 28.1 Slovenia 20.6

Now look at these long-term trends (averages per decade) for youth unemployment in the worst-hit European countries:

80s 90s 2000s
Belgium 18.76 20.52 20.46
Ireland 22.65 14.35 16.82
Greece 30.83
Spain 30.4
France 17.27 20.85 21.74
Italy 27.85 27.37 25.19
Luxembourg 5.24 6.92 15.74
Portugal 15.27 13.45 23.75
Sweden 6.89 17.45 21.76
United Kingdom 15.24 13.95 16.12

It is not very hard to figure out where these numbers come from. Europe has been on a long-term path to slow growth and economic stagnation. The Great Recession wiped away a thin layer of economic activity that superficially gave the impression of a solidly performing European economy. Now that the Potemkin facade has fallen off, the next question is: what kind of damage does high youth unemployment do to a country?

To answer that question, let us go all the way back to 2004 and an article in the British daily newspaper The Guardian:

For most people, the suggestion that a sizeable number of British teenagers has a neet problem will prompt images of strong hair lotions and fine-tooth combs. A Japanese team of researchers that came over to Sheffield recently knows different, because their nation has neets too. The number of young Japanese not in education, employment or training – the neets – is now [ in 2004] an estimated 600,000. The scale of Britain’s neet phenomenon is difficult to gauge. Bridging the Gap, a report by the Social Exclusion Unit five years ago, found that “at any one time, 161,000, or 9%, of the age group [16-19] are outside of education, training and work for long periods after the school-leaving age of 16”.

In 2004 Britain’s youth unemployment was at 12.1 percent, a historically low number for that country. So how is this number associated with the NEET problem? A researcher on the delegation to Britain explains the situation they faced in Japan a couple of years out of the Millennium recession:

“Until 1997 or 1998 there were no neets, but in the last few years many young people have become too wealthy to have to work – there is no need, no urgency. It is a rich country’s problem.” The neet group in Britain, on the other hand, tends to be from the lower socio-economic groups, says Dr Liza Catan, who directed Youth, Citizenship and Social Change, the largest research programme into young people’s lives yet undertaken in the UK … Though the causes are different, there is no doubt that the symptoms can be similarly worrying and damaging.

Before the recent spike in youth unemployment in many corners of Europe, the phenomenon of unemployment among the young was apparently different in character. The Guardian again:

… but what about a related and slightly longer-standing problem among young Japanese: the “freeters”? (The word was concocted by combining the English word “free” with the German word for worker, “arbeiter”.) This term was coined in the late 1980s, during Japan’s bubble economy. It referred to young people who deliberately chose not to engage in regular work, despite the large number of jobs available at that time. It came to include people aged between 15 and 34 who do not make use of their qualifications to embark on careers, but remain only casually involved with the labour market in a series of temporary jobs, usually in the sales and service sector. Freeters often intend to have a steady job one day. According to government statistics, there are more than 4 million freeters. They are not necessarily from deprived backgrounds, and increasing numbers are high-school and university graduates. The Japanese Institute for Education Policy Research identifies three main groups of freeters: “Those who desire freedom and ease – the tarrying type; those who attach importance to doing what they want to do – the dream-chasing type; and those who cannot find their desired regular employment – the no-choice type”.

These are all examples of people who can ostensibly make enough money on casual employment to get by, pay their daily expenses and afford themselves the physical and social freedom that comes with non-regular employment. But this is not the situation in an economy where one in four, one in three or even a majority of young people cannot even find a job if they want to.

In other words, the Japanese “freeter” is the face of youth unemployment when the economy is doing well; the question is what happens when the “freeter” decides that he wants a job, or is forced by higher cost of living to look for a job, but cannot find one.

Obviously he will be joined by large groups of non-freeters, whose sole desire from the get-go is a steady job, and for each new class that graduates high school or college into a bad economy the pool of unemployed young changes character. It gradually becomes dominated by those who would never slack like freeters but want the regular type of life, like their parents had.

A more formal approach to the youth unemployment problem with reference to disenfranchisement from society and the economy, is taken by the International Labor Organization in a new report called Global Employment Trends for Youth. The report begins by pointing to the alarming trend in youth unemployment:

Since 2009, little progress has been made in reducing youth unemployment in the Developed Economies and European Union as a whole. The youth unemployment rate in 2012 is estimated at 18.1 per cent, the same rate as in 2010 and the highest level in this region in the past two decades. If the 3.1 per cent discouragement rate is taken into account, the discouragement‐adjusted youth unemployment rate becomes 21.2 per cent. The youth unemployment rate is projected to remain above 17 per cent until 2015, and decrease to 15.9 per cent by 2018.

We’ll see about that forecast. There is a slow but steady downward trend in the United States, where youth unemployment has fallen from over 17 percent to below 16 percent in the last two years. But not only is that a very slow recovery, it is also a marked difference compared to Europe where unemployment generally is stable or rising.

The difference between the United States and Europe makes life a lot tougher for Europe’s young, who involuntarily are pushed into a NEET lifestyle.

Here is an important observation by the ILO report:

The youth unemployment crisis in advanced economies is also reflected in longer job search periods and lower job quality. In the majority of OECD countries, one‐third or more of young jobseekers are unemployed for at least 6 months. In Europe, an increasing proportion of employed youth are involved in non‐standard jobs, including temporary employment and part‐time work, and evidence shows that a significant part of the increase is involuntary rather than by choice. Youth part‐time employment as a share of total youth employment in Europe was 25.0 per cent in 2011. Another 40.5 per cent of employed youth in the region worked on temporary contracts.

This means that in some countries practically every person 25 or younger is only casually attached to the labor market. Their opportunities to support themselves are slim to non-existent, which means they do not build the same kind of loyalty relations to the society they are going to inherit as their parents did.

Which brings us back to the NEET’ers. Young people who are not in education, not in employment and not in job training build no crucial economic ties to the rest of society – except for what they receive in the form of welfare or unemployment benefits. When government cuts those benefits and the involuntary NEET’ers have nowhere else to go, they eventually become social dynamite.

Even if young unemployed, non-student Europeans are not going to start a violent revolution, the longer they go unemployed and unattached to the economy they will drift away from it. They feel no loyalty to do their fair share in growing, or even preserving the prosperity that is withering away in the Old World. A similar disconnect relates to parliamentary democracy.

It is difficult to say at this point what the actual consequences will be of this growing lack of loyalty ties between the young and the society they live in. We do now one thing, though: a society of fragmented individuals is a society in decline.

Europe’s Alarming Jobless Problem

Recent numbers from Eurostat reveal that youth unemployment in Europe is still on the rise. This is bad news in itself, but with social unrest simmering across the continent this is slowly turning into political dynamite. The worst part is that Europe’s political and economic leaders are entirely clueless as to what to do about the problem. They call on the European Central Bank to cut its interest rate, somehow believing that it is the sword that will cut the Gordian knot.

It is not, of course. Europe’s problems are much too big to be solved by a simple interest rate cut.

Let’s start with a report from EU Business:

Eurozone unemployment hit a fresh high in April for the 24th month, deepening the plight of the jobless young and raising analyst calls for a cut in interest rates.

A rate cut by the ECB is the same thing as an expansion of the supply of money, or liquidity as it is known in an advanced monetary economy. The problem for the ECB is that it has already expanded money supply handsomely over the past year in an effort to save credit-defaulting welfare states like Greece, Spain, Italy and Portugal.

There are other, real-sector related reasons why the European economy is not moving forward. We will get to those in a minute. First, back to EU Business, which paints a grim picture of a continent in permanent decline:

The latest picture from the Eurostat data agency offered little hope of a quick exit from recession for Europe’s “lost generation” of under-25s. As the economy struggled and 95,000 more people joined dole queues between March and April across the 17-nation eurozone, the unemployment rate edged up to a record 12.2 percent, or 19.3 million people, the Eurostat data agency said. The data brought more bad news for young people who overall are especially hard-hit by the sluggish economy, nearly three times more likely than older people to be unemployed.

Imagine the devastation that this is doing to an entire generation. Unemployment is slowly growing, not shrinking. In more and more European countries, it is more common for a young person to be unemployed than to have a full-time, steady job. In yet another group of countries it is more common for young people to be unemployed than to have any job at all. Here are Eurostat’s youth unemployment numbers from 2012, and these are only the EU member states that have a higher-than-20 percent rate of unemployment among working-age citizens 25 or younger:

Greece 55.3
Spain 53.2
Croatia 43.0
Portugal 37.7
Italy 35.3
Slovakia 34.0
Ireland 30.4
Latvia 28.4
Bulgaria 28.1
Hungary 28.1
Cyprus 27.8
Poland 26.5
Lithuania 26.4
France 24.3
Sweden 23.7
Romania 22.7
United Kingdom 21.0
Estonia 20.9
Slovenia 20.6

In order to keep their welfare states afloat these countries typically need a workforce participation rate way above 70 percent. In fact, over time they need that rate to increase to compensate for expanding demand for welfare-state entitlements and services. (One aspect of this is that high immigration, putting more demand on the output side of the welfare state, only accelerates the need for workforce participation.) How are these countries going to maintain a workforce participation rate high enough to keep their welfare states afloat if as many as one quarter to one half of their young generation cannot even find a job – never mind a job that will pay well and put them on a successful career track?

The EU Business article concurs:

The eurozone is in its longest recession ever and concern is mounting over the growing numbers of jobless youth amid fears they will never get on the careers ladder. In the 12 months to April, almost 200,000 young people joined dole queues in the eurozone and 100,000 in the full 27-nation European Union. Total youth unemployment was at 5.6 million (23.5 percent) in the full EU and 3.6 million (24.4 percent) in the eurozone. But in Greece in April two out of three youngsters were without jobs, one out of two in Spain and two out of five in Italy and Portugal.

This is bad. Very bad. The European economy has entered a new phase, one of permanently lower standard of living, because the cost of the welfare state over the past two decades has weighed down so heavily on the private sector that it has stopped evolving. Taxes and labor market regulations – the former feeding the welfare state and the latter designed to protect it from even higher unemployment costs – have caused the private sector to stop evolving, stop rejuvenating, innovating and keeping up with global competition.

With a stagnant private sector came a stagnant economy. With a stagnant economy came a stagnant tax base and stagnant tax revenues to feed the welfare state. But demand for the services and the entitlements of the welfare state has been rising steadily, especially (but not exclusively) at the lower end where more and more people need unemployment benefits and poverty relief. This forces the legislators of these countries to cut benefits down to a bare-bones level, something they will do very reluctantly. But after having maxed out taxes (partly during the austerity phase they are now in) they will have no other choice.

The unemployed generation will inherit the ruins of the welfare state, the crumbs from the last supper that the generation of their parents enjoyed before voting to turn Europe into an economic wasteland. Rather than structurally and predictably phasing out the welfare state, they chose to stay the course all the way to the edge of the cliff.

The European economy is in such bad shape that it can’t be saved with an interest rate cut. Anyone willing to borrow money at low interest rates will not invest it in starting or expanding businesses. He will instead buy Spanish treasury bonds which still pay almost seven percent interest rate per year. That rate, and the very investment in the bond, is guaranteed by the European Central Bank, the same institution that is pushing lending rates through the floor. By guaranteeing all money back on Spanish bonds the ECB has eliminated the market-based risk assessment of treasury bonds, and therefore artificially inflated the return on that investment.

As a result, anyone with two cents worth of credit will go to a bank in Europe, borrow one million euros at two percent and buy Spanish treasury bonds at seven percent. With an ECB-guaranteed investment, he is cashing 50,000 euros per year without doing anything more than eat, breathe, sleep and walk his dog.

What reason does he have to risk it all by investing in productive activity for an economy that is stagnant or shrinking?

If the ECB let go of the Spanish, Greek, Portuguese, Italian and French welfare states, they could return to reasonable monetary policies. The problem is that you cannot just shut down a welfare state – the hundreds of millions of Europeans who depend on it for their daily lives would suffer undeservedly, and for a long time. The only way to get rid of the welfare state is through structural reforms that gradually transfer the responsibility for operating and funding entitlements to the private sector.

Such reforms will take quite a bit of hard work on behalf of Europe’s elected officials, work that I seriously doubt they would ever want to put in. They seem to be chronically unable to think with the long-term perspective in mind. But if they don’t do anything to save Europe from its transformation into an economic wasteland, they will find themselves faced with much uglier problems than a stagnant economy. Der Spiegel gives us a hint:

Thousands of “Blockupy” protesters gathered in Frankfurt on Friday, surrounding the European Central Bank to air their concerns about euro-crisis policies. Both the banks and police were reportedly well-prepared for the anti-capitalist demonstration. An estimated 2,500 supporters of the anti-capitalist group “Blockupy” demonstrated in the German financial capital of Frankfurt on Friday, blocking access to the European Central Bank (ECB) in protest of euro-crisis austerity policies. Banging on drums and carrying signs that read slogans such as “Block the ECB — Fight Capitalism and Austerity” and “Humanity before Profit,” the demonstrators cut off roads leading into the downtown financial district.

Those of us who saw the “Occupy” movement up close were amused at its transient nature and its disdain for hard work. They were too lazy to even put together a concerted message on what they were for – or against, for that matter. The demise of the “Occupy” movement was inevitable, in good part because this is still America. You can voice your disdain for hard work and self determination all you want, but those values still build the backbone of this country (Obama’s effort to the contrary notwithstanding).

Similar movements in Europe have much stronger political potential. The Europe that emerged from the ruins of World War II put more and more of its economic resources into building a welfare state. Gradually, whatever sentiments of pride in self determination that Europeans had honored, dissipated and were replaced with equally strong sentiments of entitlement and complacency.

The political equivalent of that combination is called “social democracy” or “democratic socialism”. This also became a defining political movement across Europe with dozens of parties with thousands of elected legislators all across the continent. It has now fostered two generations into believing that it is a law of nature that man shall be dependent on government.

When a radicalized youth movement protests “Capitalism” and “banks”, it resonates with millions of young, unemployed and very frustrated Europeans. There is a great deal of potential for radical movements to capitalize on the disenfranchisement that comes with mass youth unemployment, stagnant economies and an overall depressing outlook on the future.

The rhetoric of the German protesters may sound awkward to an American, but they strike a dangerous tone with Europeans:

“The business operations of the ECB have been successfully hindered,” a spokeswoman said, according to the German news agency DPA. “We are making Europe-wide resistance to devastating policies of poverty visible.” The European Blockupy movement … is critical of euro-zone leaders’ approach to the debt crisis. Forcing struggling countries to raise taxes and implement tough austerity measures has only served to deepen the Continent-wide recession, they allege.

This is a correct analysis – nothing to be afraid of in other words. What should have everyone worried is the underlying antipathy for the forces of the free market, Capitalism and economic freedom. To get a glimpse of what these people are aiming for, consider this paragraph from one of the blog articles at Blockupy Frankfurt:

While the German state and media like to portray Germany as a strong economic example, as a “profiter of crisis”, and indeed a broad section of German society identifies with this talk, a closer look reveals other realities. The labor market reform pushed through in Germany in 2004 – slashing long fought-for workers’ rights and securities and resulting in a massive precarization of the workforce – serves as the model for the neoliberal reforms that the German government and European financial elites try to push in all of Europe. Real wages have declined in Germany for the past ten years, while the financialization of ever more spheres of life and the privatization of ever more common goods and spaces lead to a drastic increase in the cost of living. We are struggling against increasing precarity and its constant stress and social destruction.

It is easy for the “right” kind of political movement to turn this frustration into political energy. Let us hope that does not happen. Europe does not exactly have a stellar track record in respecting democracy and economic and individual freedom.

The Lebanization of Sweden

Every time I bring up the decline of Sweden with my libertarian American friends, they smile and say that there are no problems in Sweden because they just visited the posh, upscale shopping malls in downtown Stockholm and everything was so nice and quiet and clean. And besides, they say, their American cell phone worked on the commuter train to the airport, so Sweden is very modern and advanced and sophisticated.

Little do they know – because they don’t want to know – that 4-5 subway stops away from the fancy-pants hotels, art galleries and restaurants in downtown Stockholm, cars are being burned, rescue workers are being stoned by rioting thugs, schools are set on fire, police stations firebombed and mass transit suspends service because bus drivers fear for their lives driving through those neighborhoods.

I don’t think anyone would judge New York, let alone America, by taking a walk from Battery Park to Fulton Street on Manhattan, yet that is basically how superficially America’s libertarian intellectual elite “analyzes” Sweden.

At the end of the day it really does not matter how America’s libertarian pundits view Sweden. What really matters is how politically influential people decide to use the terrifying experience of Sweden’s slow-progressing collapse to save their own countries from going down the same path. But it would help, of course, if all friends of freedom would open their eyes to reality as it unfolds around them. We need all hands on deck to restore individual and economic freedom.

I recently reported on the riots that for more than a week engulfed Stockholm’s rundown, over-crowded, crime-ridden housing projects. I have also reported on the escalating, politically motivated violence that is now becoming a credible threat to the very democratic form of government in Sweden. I have also explained how the large, costly Swedish welfare state attracts tens of thousands of welfare immigrants every year, immigrants who flock to the housing projects and raise their children in virtual isolation from the rest of Swedish society.

Not to mention that the Swedish state is de facto capitulating before an onslaught of serious organized crime.

Today I will let two other Swedish voices present their views of the terrifying decline of our native country. Unlike me, they still live there and are trying to do what they can to delay the inevitable. First, here is a report from the blogger Cavatus, whom I have known for a few years now as an astute yet often restrained observer of Swedish politics and public policy – when Cavatus speaks up, it is for very compelling reasons:

Sweden has disgraced itself internationally because of the riots last week. But don’t believe that it all has ceased by now. Every night there are cars on fire and other subversive mischief in the immigration suburbs. In the wake of the first riots, in all 70 [housing projects] have been struck so far by the consequences of Sweden’s downright failured immigration policy.

Please note what Cavatus is reporting. The week of eye-catching riots did not end. The destruction, which included but was not limited to attacks on shopping centers, police stations, child care institutions, schools and mass transit (including an arson attack on a commuter train station), did not end when media turned their cameras elsewhere. They scaled down but continued and have in fact spread to more cities than Stockholm, Gothenburg, Malmo, Uppsala, Linkoping and Orebro, those hit during the first week.

High-intensity social unrest has been replaced by a low-intensity outpour of anti-social behavior.

Where does this anti-social behavior come from? As I explained in my article on welfare immigration, it is never a good idea for a society to import large numbers of people from culturally, socially and economically very distant countries, put them on welfare and expect them to assimilate into your cultural and social traditions. When unemployment is high – as it has been in Sweden for a good two decades now – and welfare benefits are endless; when the immigrants rarely have more than a few years of elementary education (many who come to Sweden only report two years of Koran school) the stage is set for social disintegration rather than integration.

Despite this alarming problem unfolding under their very noses, the Swedish political establishment fail to see what is going on. Cavatus gives a very telling example:

A politician, member of one of the ruling parties (Olle Engström in Borås), had a letter to the editor published yesterday in the newspaper Borås Tidning, in which he rejected the uncontrolled immigration policy and dreaded that Sweden shortly would fall into a religious civil war if nothing is done, like Lebanon and such countries.

Here is what this long-time politically active, elected official said (my translation – click here for google translation):

In Sweden, we have since the 1950s and ’60s opened our country to hundreds of thousands of people from other countries who have fled from oppression, unemployment, war and starvation, who have been given a new homestead here.

Yes, this guy does put on equal footing escaping from war and “escaping” from unemployment. Typical Swede… But let’s continue to listen to him – it does get interesting:

Over the past week we have read in the papers about the ramifications of overly optimistic and unrestricted immigreation to Sweden. Society [referring to government] is losing control over the situation. Today, vandals and rioters are subjecting our entire social structure to enormous pressure which, over time, can have very serious consequences. As a citizen and politician I mourn today over what is happening. … Those who instigated and participated in these riots don’t understand what profound damage their so called pastime has done to the efforts to build bridges of understanding and empathy between people from different cultural backgrounds. … Where is Sweden heading? I see before me a Sweden that in 20-30 years has totally lost control over the situation, with frightening consequences.

Dear Mr. Engstrom – that is going to happen in much less time than that, perhaps as little as 2-3 years.

Terrorism, violence and crime will increase in Sweden. and maybe we might also, down the road, see a full-scale civil war between religious groups, similar to what has been and is happening in Lebanon, Iraq, Nigeria and other places.

 A local elected official, long-time member of the ruling Moderate party, fear for the future of his country. The day after his letter to the editor was published, the former mayor of his hometown, Boras, wrote a rebuttal claiming that Mr. Engstrom was completely wrong on all accounts. Anyone familiar with Swedish political culture can immediately identify this rebuttal as an official declaration from the Moderate party that Mr. Engstrom is no longer a member. He was expelled for speaking up against mass immigration and for voicing his concern regarding the social and economic future of his country.

Cavatus confirms this:

Today, he was excluded from his party, Moderaterna (“the Moderates”). A fellow party member had today a letter to the editor published in the same newspaper, where he maintained that “it is not the immigration that gives frightening consquences for the society; it is the blind criticism without nuances of it”. I mention this just to show you how completely impossible it is to talk about the quantity of immigrants that Sweden can embrace and the results of the quantities received so far. So despite nationwide riots, we are still not allowed or able to talk about it, unless we want to be labelled racists, foremost by the media and the journalists. This is, in fact, an indication of Sweden’s severe predicament.

Cavatus is absolutely right. In Sweden today it is akin to political suicide to speak up about the riots and their relation to the very large immigration that has taken place, especially during the past decade. But it is in fact worse than that: as my article on political violence explained, critics of immigration are targeted by violent political mobs, their homes and other property being attacked and they themselves being victims of harassment and even assault.

This video gives a glimpse of what is happening (the man interviewed is chairman of the National Democrats, a party with a nationalist agenda that I do not support – nevertheless, the commentary of the interview is worth taking seriously):

For a more in-depth commentary and an interview with brave journalist Ingrid Carlqvist, take a look at this video.

As the Lebanization of Sweden progresses, we will hear more from there. Stay tuned.