Thomas Piketty: “Germany has never repaid.” • Hacker News Board

Re: Thomas Piketty: “Germany has never repaid.”

#261

Post by vidarh » Mon, Jul 06, 2015, 9:22 AM UTC

tjradcliffe wrote: post #203

Lecturing Germany on its own history is just about the most useless contribution to this debate possible. Germany and everyone else who foolishly loaned Greece money in 2010--and before--wants to get paid. There is nothing wrong with that. Dredging up the irrelevant past? Not so much. Or: if I owe someone money, it doesn't matter if they are a nice person or not. I still owe them money, and must suffer the legal cons…

He's not engaging in moralising. The entire point is that while there's nothing wrong with wanting to get paid, it's entirely irrational to try to force payment no matter the consequences. Especially when both historical examples of similar steps and numbers from the last few years in Greece demonstrates that such a policy is likely to make matters worse, not better, not just for Greece but for the creditors as well.

Re: Thomas Piketty: “Germany has never repaid.”

#262

Post by DasIch » Mon, Jul 06, 2015, 9:23 AM UTC

andy_ppp wrote: post #119

Everyone always seems to forget in these discussions how fantastic for German exports having instability in the Eurozone is...

Exports have been an important part of the German economy for decades. People aren't buying German products because they happen to be cheaper now and the won't stop buying them should they get more expensive.

Re: Thomas Piketty: “Germany has never repaid.”

#263

Post by junto » Mon, Jul 06, 2015, 9:24 AM UTC

justincormack wrote: post #255

junto wrote: post #243

Earlier quoted context omitted.

Although I agree with you, the situations are a bit different. In the case of post WWII it was widely recognised that Germany's debt and war reparations were a major cause of WWII and helped with the rise of the National Socialist Party in Germany. Greece doesn't have a modern history of military aggression. Germany did. What the Allies put in place was in their own interests. The Allies didn't want to make that mist…

Greece did though have a military coup in the 1960s[1] [1] https://en.wikipedia.org/wiki/Greek_military_junta_of_1967%E...

They did, but domination of Europe and beyond wasn't really really in their scope.

Re: Thomas Piketty: “Germany has never repaid.”

#264

Post by usrusr » Mon, Jul 06, 2015, 9:30 AM UTC

Chinjut wrote: post #223

Atropos wrote: post #222

Earlier quoted context omitted.

Oh but the current generation of Germans has a moral responsibility to help the current generation of Greeks because Germany got debt forgiveness 60 years ago ???

The idea isn't that Germans have incurred a special moral responsibility (which they otherwise would not have) because Germany received debt forgiveness 60 years ago. Rather, the idea is that the debt forgiveness Germany received 60 years ago ended up working out quite well, most of us would agree. Thus, we would do well to learn from this history, instead of dogmatically keeping debt forgiveness off the table.

What I see missing in those analogies between historic debt forgiveness events and a possible approach to the current Greek situation is that those historic cases all happened in the context of a complete reboot of the debter state right down to the constitution. Ironically, the one that happened within a democratic framework is the kind of reboot you absolutely don't want to see repeated anywhere.

Re: Thomas Piketty: “Germany has never repaid.”

#265

Post by dan00 » Mon, Jul 06, 2015, 9:31 AM UTC

lorenzfx wrote: post #245

HSO wrote: post #59

At the risk of being a moralizing bore, may I remind everybody that "Germany", "Greece" etc. are not people, and that people are not countries? I am surprised by the national coloring, however faint, of some comments here and there https://news.ycombinator.com/item?id=9834721 . "I am a German" or "Greek here" should have no relevance to the ideas put forth. "Your money" and "your banks" are not really "my money" and…

What really gets me going is how "we" helped the banks fill their coffers and socialize the losses. Again. Lending Greece money went along with earning (comparably) a lot of interest exactly because of the high (perceived) threat of Greece defaulting. And now that it has (nearly) come to that, all the risk has been moved to the EZB, etc. I called my local elected representative about it, SPD (social democrat), and "v…

> I called my local elected representative about it, SPD (social democrat), and "voiced my concern", but only got met with talk about chain reactions and responsibility. Perhaps I shouldn't have shouted.

I think the problem is, that nobody really knows what had happened if we've let the banks die.

The fear that the results might be a lot worse than the current situation is perhaps the driving force of politics of the last years.

Re: Thomas Piketty: “Germany has never repaid.”

#266

Post by pjmlp » Mon, Jul 06, 2015, 9:33 AM UTC

luso_brazilian wrote: post #152

HSO wrote: post #59

At the risk of being a moralizing bore, may I remind everybody that "Germany", "Greece" etc. are not people, and that people are not countries? I am surprised by the national coloring, however faint, of some comments here and there https://news.ycombinator.com/item?id=9834721 . "I am a German" or "Greek here" should have no relevance to the ideas put forth. "Your money" and "your banks" are not really "my money" and…

OK, I'll try to shed some light on why this subject tends to inflame some of the europeans nationalistic sentiment with a concrete example: 1. Meet Portugal (my country). Some may know us derisively as the P in PIGS because of our financial problems (much similar to the Greek one in nature and extent). In 2010 and 2011 as one of the 14 member states of the EU that were part of the Greek loan facility Portugal contrib…

As Portuguese you should also be honest and mention how we tend to have similar corruption cases like Greece.

How people avoid asking for bills when going to the doctor to avoid the extra 20 euros being added to the bill.

How people get things done, because someone has a friend that knows a guy... Of course without anything written and payed in cash.

How many small businesses closed down because they couldn't afford the new computer systems required by IRS.

How Portuguese are fleeing the country to countries like Angola, Mozambique and south American ones in the hope of finding a job that helps pay the bills to those that stay back.

Lots of many other cases that don't make us far from the Greek situation.

Yet, the Portuguese media has the outrage to call us a success case?!

Re: Thomas Piketty: “Germany has never repaid.”

#267

Post by vegabook » Mon, Jul 06, 2015, 9:33 AM UTC

alexqgb wrote: post #129

Tehnix wrote: post #86

I feel sorry for the Greek people, but I personally favour throwing them out of the Eurozone if they default on the debt. It will be a very dangerous signal to send that you can borrow money, and not pay it back without any retribution. This is particularly important since more countries are going in the same direction as Greece (I think Spain and Puerto Rico are close, but I might be wrong). Besides that, it also hu…

What you don't understand is that a debt represents a risk to the lender , not a guarantee. If a debt were a guarantee, then there would be no basis for charging interest. In a well regulated system, the people who make bad bets are not entitled to retribution. They are "entitled" (read: expected) to go out of business. At the very least, they suffer embarrassing losses that they must explain to their shareholders. "…

Well put. Yet all our banks who have been reckless lenders have simply been led to the trough of unlimited QE to short circuit this healthy mechanism that you cite. We'll pay more in the end because of it.

Re: Thomas Piketty: “Germany has never repaid.”

#268

Post by muro » Mon, Jul 06, 2015, 9:38 AM UTC

craigyk wrote: post #189

muro wrote: post #168

Earlier quoted context omitted.

In "The Economic Consequences of the Peace", there is argument that the original reparations were make-believe and impossible. The 1929 revision was probably closer to reality and Germany did recently repay them. [at least according to news articles from 2010]

Germany was _forgiven_ over 50% of it's post war debts. By my rough calculation, 35B+ in today's dollars.

Yes, it was "forgiven" 50%, but at least in that book, the author explains that the process of how the original sum was calculated was that France asked for an unreasonable sum in the first place.

Re: Thomas Piketty: “Germany has never repaid.”

#269

Post by twobits » Mon, Jul 06, 2015, 9:46 AM UTC

mattmcknight wrote: post #180

rtpg wrote: post #150

Earlier quoted context omitted.

And austerity has been shown to be a remarkable failure for any form of economic recovery not just the first, but pretty much every time any country has tried it Why would you try it on Greece then?

How would you define austerity for the Greece? To have public spending at 58% of GDP?

I'd define it as me paying 90% taxes last year, while my country is still getting worse.

Re: Thomas Piketty: “Germany has never repaid.”

#270

Post by rustynails » Mon, Jul 06, 2015, 9:57 AM UTC

Chinjut wrote: post #223

Atropos wrote: post #222

Earlier quoted context omitted.

Oh but the current generation of Germans has a moral responsibility to help the current generation of Greeks because Germany got debt forgiveness 60 years ago ???

The idea isn't that Germans have incurred a special moral responsibility (which they otherwise would not have) because Germany received debt forgiveness 60 years ago. Rather, the idea is that the debt forgiveness Germany received 60 years ago ended up working out quite well, most of us would agree. Thus, we would do well to learn from this history, instead of dogmatically keeping debt forgiveness off the table.

I apologise if this sounds bad, because it is. Maybe there's some truth to the "Germany should show compassion like the allies did".

To quote, "he Allies also confiscated large amounts of German intellectual property (patents and copyrights, but also trademarks).[27] Beginning immediately after the German surrender and continuing for the next two years the US pursued a vigorous program to harvest all technological and scientific know-how as well as all patents in Germany"

Reference here, https://en.m.wikipedia.org/wiki/Allied_plans_for_German_indu...

If you do the research, the U.S. Leveraged a similar deal over the UK to obtain all patents royalty free as an incentive to enter WWII.

There may be some leverage that can be applied. These corporate and IP raids netted the U.S. hundreds of trillions of dollars.

I was first devastated when I first found this out. It reminded me that the line between the "goodies" and "baddies" was not so clear.