Kevin O’Rourke gets it just right
I'm not one for really long quotes on this blog, but O'Rourke's post today deserves to be clipped and remembered. The comments are not worth reading. O'Rourke quietly, but angrily, gets it just right: capital walks away scot free."[T]he real cleavage in Europe is between European taxpayers and bank creditors (with the ECB being a third interested party, as another body which could help to fill the holes which have emerged in the European banking system). But since the powers that be are ruling out bondholder haircuts and quantitative easing, the only cleavage we are left with in practice is the one between core and periphery taxpayers.
Of course ordinary French and German taxpayers are going to be angry at lending their money to an insolvent state with lower tax rates than their own. Why wouldn't they be? Of course ordinary Irish taxpayers are going to be angry at having to pay for high interest loans designed to bail out foreign banks. Why wouldn't they be?
And while ordinary Europeans get angry with each other, with unpredictable political consequences, capital walks away scot free."