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Jul. 28th, 2009|10:18 am |
Thanks for replying (I'll do this in English - I'm supposed to be working;):
Understood - but not all banks took part in this frenzy. Those who did, I would argue, should be just as exposed to the consequences of what they did as those who speculators who took credit (Not forgetting my proletarian roots, I hesitate to include families who bought a flat where they would simply try and live). As it is, it looks like the majority will be bailed out -
Which, especially in relation to Latvia, is where it gets confusing (for me -I am a bear, it seems, of little brain). The money from international lenders is primarily going to prop up the lat and to parex (as I understand half of the 1.2 billion from the EU is set aside for the financial sector). The beneficaries of this are:
banks - thus for a while protected from the mass defaults that would most likely take place with a devaluation;
those who took credit - at least as a 'by product' - AK bank, for example has shown its teeth to those clients who haven't even missed a payment;
parex bank creditors (and who else benefits from that is anyone's guess.)
So, I would argue, the obsession with slashing the wages of low-paid public sector workers and pensioners is immoral. They do not benefit directly from this tactic of saving the banks' hides, and should not have to pay the cost. That's really my main point in all of this - the fixation with the corruption and inefficiency of the public sector/Latvian govt (although not without foundation, believe me - I understand) has lead to it being a convenient scapegoat for the current ills. |
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