Beltway Insider: Obama Opens Cuba; Greece Bank Crisis; Brazilian Partnership; The Grateful Dead

Details

Category: Beltway Insider

Published on Sunday, 05 July 2015 19:56

Written by Janet Walker

President Obama, German Chancellor Angela Merkel and Italian Prime Minster Matteo Renzi have continue to communicate, watchful of the precarious financial situation facing Greece and the voter referendum presented today to the people.

According to Gallup, President Obama's job approval, over the past week, decreased two percentage points to 45% of those polled who approve of his effectiveness as President and those who disapprove of his effectiveness as President increased one percentage point to 50%.

Obama Opens Cuban Embassy

In what can be considered the first anti-Kennedy era reform, Obama has ended policy that was initiated by then President John F. Kennedy, in response to the deployment of Russian ballistic missiles in Cuba.

"More than 54 years ago, at the height of the Cold War, the United States closed its embassy in Havana.  Today, I can announce that the United States has agreed to formally re-establish diplomatic relations with the Republic of Cuba, and re-open embassies in our respective countries. This is a historic step forward in our efforts to normalize relations with the Cuban government and people, and begin a new chapter with our neighbors in the Americas," the President said.

Greek Banking Failure Reverberates

President Obama has remained in continued communication throughout the week with Prime Minster Matteo Renzi of Italy regarding developments in Greece. 

The leaders have agreed on the importance of all parties to work to put Greece back on a path of reforms and financing that leads to growth and debt sustainability within the Eurozone. 

In the week since Greek leaders decided to put the vote before the people, quick grass roots groups championing both sides of the referendum have sprung up urging the nearly 10million eligible voters to understand, in theory, the reasons they should vote "Yes" or "No."

The future is not smooth for either side. To vote "yes" is to accept the bailout offered and its restrictions, which affect deeply certain members of society, or "no" and face the subsequent repercussions from the choice.

"The leaders noted that their teams are in close contact and are monitoring economic developments in Greece as well as broader financial markets," the President said in a released statement.

The financial risk to United States economic markets, in terms of direct exposure and shockwaves, is slim. Greece does not pose a major direct risk to the United States banking system and it directly effects the European allies. The minor swings the market endured throughout the week are reactionary and not indicative of permanence. 

However, the robust growth and economic stability in Europe is clearly within the U.S. economic interest and as well as the national security interest.  

"We do continue to urge all sides to contribute to a pragmatic discussion in pursuit of the goals that I described earlier, both because it's in the economic interest of our country but also in our broader national security interest," said Josh Earnest, White House Press Secretary.

Banking Failure

With a precarious and concerning financial situation unfolding, historians refer to the American Banking failure which ushered in the Great Depression of the 1930's.

As banks remained closed across Greece, cash machine withdrawals, a sign of some solvency, were limited, although still dispersed, to €60 (Euro) per day.

Banks have remained shut throughout the past week triggered by the European Central Bank's refusal to provide more emergency funding for the floundering Greek nation.

The country, best known for its remnants of ancient civilizations, modern Santorini and the Greek Islands, is defaulting on its loans missing a crucial €1.6bn (£1.1bn) payment to the International Monetary fund.

Leaders of the beleaguered nation took the decision to the people initiating a voter referendum to allow the people to determine the next step as the outcomes will directly affect the population for at least a decade.

"It is in the interest of the United States for Europe to continue to be closely integrated and strong and effective.  And that is the view that we have expressed in the past, and that is what gives us some confidence that the kinds of challenges that are currently being confronted by the negotiators can be expressed through a package of reforms and financing that will allow Greece to return to a path of economic growth and debt sustainability," Earnest said.

Run on the Banks

The closest American reference to the "Capital Restrictions" facing the people of Greece would be the government imposed restrictions after September 11, 2001 when all banks were closed and transportation halted.

The Grecians are patiently waiting, in very long lines, daily, to slowly retrieve their money from the failing banks. Banking officials have related the information, which may be limited in Greece, to the international community which indicates the banking system is "days" from collapse.

This pebble in the pond will reverberate throughout the Mediterranean nation first, with the first bands touching employment as workers will have to make the choice to work without wages, face cut backs or face lay-offs or cut backs.

As banks run out of money, the government may, through law, compel government employees and service workers, to remain on duty to keep the infrastructure from total collapse and the nation without a defense.

The Numbers

Greece, as a nation, owes €323bn to various banking institutions and funds in place to stabilize Europe and assist European nations continue to modernize infrastructure and stabilize the necessary macro-economic factors, unemployment, economic output, inflation, savings and investments, which have suffered greatly through the most recent global economic meltdown of which not all nations have recovered.

Greece is one of the many nations, albeit the most civilization European nation to face financial bankruptcy and a banking crisis. When the United States was facing 10% unemployment, nations like Greece were facing 40% unemployment. Even the financially stable citizens are facing financial hardship.

Those depending on the government, the disenfranchised, the long term unemployed, the retiree, are among the targeted population, the financial institutions who have offered the government more loans to cover the debt have placed the harshest restrictions on assistance.

Nearly 60% of the debt Greece currently owes is to the European Financial Stability Fund [€141.8bn] and the Greek Loan Facility [€52.9bn]. International Monetary Fund is owed 10%, European Central Bank, 6%; Greek Banks 3%; Foreign Banks 1%; Bank of Greece 1%; other bonds, 15%; and other loans 3%.

The Ballot

"What we've indicated is that there's a democratic process that is underway in Greece, and that's a process that will be determined by the Greek people.  As it relates to Greece and their continued membership in the European currency union, I would merely note for you that the public opinion that's expressed by everyone who's sitting around the negotiating table right now -- the Greeks, leaders of the EU, the IMF and the ECB -- have all indicated that it's their view that Greece continue to remain part of the currency union there," Josh Earnest, White House Press Secretary.

The Outcome

The people of Greece have overwhelming voted down the bailout offer from European banks and leaders.

The vote sends politicians back to the negotiating table stronger, with the country behind the reform package, as the people rejected the very strict lending deals offered by the European landers.

While the people have spoken and in reality have stopped the yoke of tax burdens and government cuts to be placed on their necks for mismanagement, the European Union and other authorities are now faced with the decision on what to do with the situation.

Brazilian Partnership

President Obama played host this week at the White House to Brazilian President Dilma Rousseff. The two met to underscore the continued strengthening of each nation and to build further economic support.

The agenda discussed, and points reviewed and agreed upon include Expanding Economic Growth and Prosperity, Leading Together on Global, Multilateral and Regional Issues, Strengthening Defense and Security Cooperation, Deepening People-to-People Ties through Education, Energy, Science and Technology, Health and Innovation.

Issuing a joint communique the two presidents reiterated the points discussed in the bi-lateral meetings and presented a unified and aligned position on several issues including curbing the rising tide of extremism and violence and terrorism and each expressed deep and continued concern or several global plagues including the continued drug problem that the South American nation suffers with daily.

Terrorism, and in particular ISIS and Boko Harum, and strongholds throughout the world have been condemned in the strongest terms. Countering violent extremism that fuels this scourge requires a comprehensive approach to address communities that may be at risk of radicalization and recruitment by terrorist groups.

The ongoing and recent violence in Iraq and Syria as well as recent attacks by terrorists in Tunisia, France, Kuwait, and yesterday in Egypt, the Presidents agreed that violent extremism can take many forms and often targets some of the world's most vulnerable populations. 

Leaders in every nation must work together to implement comprehensive approaches and to prevent violent extremist ideologies from being planted and growing into strong and permanent insidious roots.

The Presidents stressed the priority given to the effort in fighting this scourge with an emphasis on public health and respect for human rights. As such, they decided to expand the exchange of national experiences, particularly those aimed at reducing drug use and providing treatment and social rehabilitation for addicts.

Grateful Dead Reunites

Attention all Deadheads, the counter-culture underground hippie band, The Grateful Dead founded by the late Jerry Garcia, ended the last of five "Fare Thee Well" concerts celebrating a time, and season, when loved ruled and peace reigned.

Fare Thee Well: A Tribute to the Grateful Dead, celebrating 50 years of The Grateful Dead has Cutting a swath across the population, The Grateful Dead, set record numbers in each venue with more than 70,000 loyal fans packing Solider Field in Chicago,

The reviews have been astounding as the core four, Bob Weir, Mickey Hart, Bill Kreutzmann, Phil Lesh along with guest artist Bill Hornsby and Trey Anastasio began a five show tour starting with two shows in Santa Clara, California and ending with three shows in Chicago, the site of the band's final show in 1995.

The Dead, as they are affectionately known, began in Palo Alto, California in 1965, at the beginning of the deep rooted counter cultural changes in American society.  

Touching a cord within people, even unknown to them, The Grateful Dead, created a style of rock and roll music that kept the folk history of America past and the likes of Pete Seegar, marrying the bluegrass sound with the 1960's folk rock that brought people together in peaceful gatherings, before sets, play times, and business ruled the day.

The assassination of President John F. Kennedy, the Vietnam War, which would eventually kill more than 58,000 American soldiers, university and street protests the height of which had not been seen, the tightly sealed lifestyle of American civilization was splitting apart and all peoples, the youth, the Negros of the south, were fighting regimes held in place by cemented and singular opinions.

Then there was The Dead, still through the 1970's drawing a loyal following of Dead Heads, who back in the early days would follow the band from city to city, camping out, dropping acid, smoking pot calling it enlightenment and freedom.

And here finally over the last week, reformed Deadheads, Wall Street bankers, L.A. Exec's, Chicago politicians, hippies, peace lovers, counter culture throwbacks donned the psychedelic, sunburst Grateful Dead with silk-screened trademarked skeleton, T-Shirt, ready for to dance and sing along to "One More Saturday Night," "Shake down Street,"  "Sugar Magnolia," "Casey Jones," "Truckin'," and other Deadhead favorites.

For more information on President Barack Obama: www.whitehouse.gov

Sources: Whitehouse.org, Wikipedia.com