World View: EU Moves Forward With Greece Debt Default

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This morning’s key headlines from GenerationalDynamics.com:

Muslim-Christian clashes in Cairo kill 10

Egypt’s cabinet is in crisis talks after clashes between Muslims and Christians killed 10 people (6 Muslims and 3 Christians, according to state television) and injured 186 and set a church ablaze in a working class neighborhood of Cairo. (AFP.)

EU officials contradict Friday’s denials on Greece debt meeting

On Friday, Greek and EU financial officials were denying that any unscheduled meeting would occur in Luxembourg, that the meeting had nothing to do with Greece, that Greece would be defaulting on its debt, and that Greece would be exiting euroland. ( “7-May-11 World View — Greece denies the rumors that it’s leaving euroland”)

On Saturday it turns out that all of those claims were lies. The only thing that they’re still denying is that Greece will be leaving euroland. But they lied about everything else, so why should we believe that? And politicians wonder why they’re held in such contempt, and why they’re never believed. The old joke that you can tell if a politician is lying by whether his mouth is moving is supposed to be just a joke, but it’s far more true than false.

According to statements made on Saturday, EU officials discussed a further bailout of Greece, either by extending the bond redemption dates, by imposing a “haircut” of around 50%, or by lending the country more bailout money. There would almost certainly be debt default in one form or another. (Kathimerini)

However, one German MP says that Berlin should do everything possible to help Greece leave the euro currency, and reinstate its old drachma currency. Many MPs in Chancellor Angela Merkel’s opposition believe that Greece’s debt trajectory is unsustainable and action needs to be taken sooner rather than later before the long-term cost becomes far greater. (Reuters)

Palestinian unity government moves toward ‘nonviolent resistance’

Following the reconciliation agreement between Fatah and Hamas, Palestinian president Mahmoud Abbas wants to project to the world that the future unity government will be committed to the same plan as the current government, which is legitimized by Western countries. Although Hamas continues to believe in its right to “armed struggle” against Israel, Hamas officials accept nonviolent resistance, at least for now. (Jerusalem Post)

Russia sees vindication of its North Caucasus policies in bin Laden killing

Russian officials reacted favorably to the killing of Osama bin Laden, but the flow of contradictory statements from the White House about the details of the killing soon changed the mood in Moscow from praise to mockery to concern. The greatest concern is that western forces will withdraw sooner from Afghanistan, leaving it to Russia’s faltering army to defend the secular Central Asian dictatorships from Islamists. However, Russia sees the bin Laden killing as a vindication of its own anti-terrorist activities in the North Caucasus provinces. (Jamestown)

Iraqis humiliated over cancellation of Arab League summit

Iraq’s mostly Shia government has sided with the Shia protesters in Bahrain, and against the Sunni rulers. This has angered the Gulf Arab countries, who are committed to using as much force as necessary to crush the protests in Bahrain. The result is that an Arab League summit that had been scheduled to be held in Iraq this year has been postponed until March 2012. Iraq had been hoping that the high prestige summit would restore Iraq’s prestige among its neighbors after years of war and economic isolation, and had spent $450 million in preparation, planting palm trees along highways, re-paving roads and restoring Saddam Hussein’s palace so that it could be used as a hotel for the Arab League delegates. Iraqi citizens are complaining that the money should have been spent on things like water, electricity, and more food. (Reuters)

California’s public pensions cost three times as much as private pensions

A study released on Thursday found that the state government spends three times as much on pensions and other benefits for retired persons as the state’s large private corporations. (Reuters)