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December 2, 2014

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review May 12, 2010 / 28 Iyar 5770

Better to let Greece go broke

By Robert Robb


http://www.JewishWorldReview.com | The Greek national government doesn't have the cash to service its debt and private parties aren't willing to lend it any more. The natural solution would be for Greece to default and restructure its debt. Those who imprudently lent to Greece would incur a loss. The Greek government would have to curtail its spending to match what it could raise in taxes and from more demanding lenders.


Instead, euro zone countries cobbled together a $145 billion bailout package, designed to relieve Greece from the need to raise private capital for a couple of years.


Rather than calm anxiety about euro zone sovereign debt, rate spreads between fiscally shaky countries (such as Spain, Portugal and Ireland) and sounder ones (principally Germany) increased sharply.


So, euro zone countries cobbled together a $955 billion bailout fund over the weekend for all euro-denominated sovereign debt.


The rationale is supposedly to prevent contagion. There are two fears. One is that the default of any euro zone country on its public debt would have cascading effects on the economies of other countries. The second, more profound, fear is that the default on any euro-denominated sovereign debt would adversely affect all euro-denominated sovereign debt and the euro itself.


These fears would seem grossly overwrought. Banks and other private parties in other countries hold Greek debt, but not in the sort of concentrations to represent serious contagion risk.


The euro is a currency, a medium of exchange. The default of one borrower in a particular currency doesn't reflect upon the creditworthiness of other borrowers using that currency or the soundness of the currency itself. Indeed, as Greece was finding it more expensive to borrow, Germany was finding it less expensive.


These bailouts will have serious adverse consequences, for Greece and the euro zone's future.


Greece has to undergo a severe austerity program. If the spending cutbacks were because Greece defaulted on its debt and couldn't borrow any more money, the Greeks would have no one to blame but themselves.


Instead, the austerity program comes as a condition of the bailout funds from other euro zone countries and the International Monetary Fund. So, there are strikes and riots in Greece, claiming that the spending cuts are unnecessary and are being foisted on Greece by nefarious outsiders.


Some think that this is good, allowing local officials to take painful action while outsiders get the blame. But that does not make for a healthy democracy or more prudent future political choices.


Rather than contain contagion, these bailouts actually institutionalize it. Basically, the euro zone countries have said that we are no longer independent political economies that share a common market and a currency. Instead, if any of us are sick, then all of us may have to pay the hospital bill.


And they increase doubts, rather than alleviate them, about euro zone public finances and the soundness of the euro.


Most of the larger $955 billion bailout package takes the form of off-budget borrowing that nevertheless will be guaranteed by euro zone countries. So, the solution to too much government borrowing is even more government borrowing, only less transparent and secure.


And for the first time, the European Central Bank will buy dodgy sovereign debt private investors are shunning. The ECB says it will offset these purchases with the sale of other assets to avoid expanding the monetary base. But that means that the ECB will be trading good securities for bad ones. Regardless, monetizing sovereign debt isn't a path toward either fiscal discipline or a sound currency.


Prior to the bailouts, Greece's fiscal indiscipline didn't really jeopardize the euro zone enterprise. Now it does.

Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

JWR contributor Robert Robb is a columnist for The Arizona Republic. Comment by clicking here.

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