Vail Daily letter: Worried about Greek debt
Vail, CO, Colorado
Americans should be concerned and informed about the current situstion in Greece.
First because it is a salutary lesson in the desire to establish policies and entitlements unsupportable by individual or national income.
Second, because there are a number of other countries that are in similar straits: Spain, Portugal, and Ireland, for example. These countries may very well require the same type of bailout.
Third, because while this administration may say they will not participate in the bailout of Greece and other countries, the American taxpayer is already committed to do so.
Readers may want review several excellent articles in Wednesday’s Wall Street Journal: Bob Davis’s “Who’s on The Hook for the Greek Bailout” and the op-ed piece “The Greek Bailout Flop.” Davis notes that our participation is relatively modest but still undefined. The International Monetary Fund is lending $39 billion to Greece as part of the Greek package. The United States stakes about 17.1 percent of the International Monetary Fund, while the next largest stakeholders, Japan and Germany, contribute 6.12 percent and 5.98 percent respectively.
But because of the the concept of “usable currencies,” which essentially says some stakeholder countries’ currencies, like Zimbabwe’s, are useless, countries like the United States actually contribute more than the stake percentages reflect.
So the answer is yes, the American taxpayer is on the hook. The efficacy of the IMF loans depends on the Greeks accepting austerity measures like pension and salary cuts, to which the Greeks have responded with rioting and now murder.
I believe there is no such thing as negligible costs. While some who deal in trillions consider millions as round-off errors, I do not. I expect my representatives to be cautious stewards of American’s tax dollars. To date I am sorely disappointed.
John A. Valersky