Greece's new Communist Prime Minister, Alexis Tsipras, set his government on a collision course with the country's creditors. In a speech on Sunday, Tsipras declared an end to a regimen of budget cuts and tax increases and said he would push for a short-term loan to give the country and its creditor’s time to negotiate a new arrangement to replace its bailout program. The terms of the original bailout were extremely generous to Greece. Tsipras said prior to his party gaining 149 seats with 151 seats need for a majority that he would do exactly what he is doing. Today the financial worlds expressed concern about the Greek situation. The chances of Greece leaving the Euro and defaulting on its commitments are very likely. What is not known is how much of a financial crisis this cause.
Spain also had a major financial crisis shortly after the bailout of Greece due to the same type of spending policy Greece had. Today the Spanish people are looking to Greek type leadership. “Tick-tock, tick-tock”, chanted the huge crowd in the centre of Madrid last Saturday as they marched in support of the new Podemos (“we can”) party. Counting out what they – and many others around Europe – expect to be the last days of the existing Spanish political order, Podemos supporters take heart from recent polls and the Syriza victory in Greece. Like Syriza in Greece, Podemos is often pigeon holed as “anti-austerity”, “radical left” and “Marxist”.
These situations have been likened to the collapse of Leman Brothers with the same type of ramifications. The collapse of Leman Brothers happened quickly. We have had warning on all three of these fronts for several years. The economic and social affects will be felt beyond the shores of South America and Europe, and yet little or no preparation is being taken. We do know that it was this type of fundamental transformation Marx said was necessary. This would appear to be the intended future for us, the United States, by our Marxist leaders.