Saturday, February 28, 2015

AXIS: Carnage #1

A good indication of the direction of a society is how the bearers of privilege are popularly depicted. Always a tried and true foil, the elite, because of the toxic and deepening nature of U.S. inequality -- the 1% versus the 99% -- along with the attendant plutocratic capture of the political system, are now more and more perceived as worthy of slaughter.

What makes AXIS: Carnage #1 interesting is that it classes factotums of the Fourth Estate, in this case talking-head newscasters, with the 1%. Very timely given the professional difficulties of Brian Williams and Bill O'Reilly.

AXIS: Carnage is an AXIS crossover tie-in. The idea, as in AXIS: Hobgoblin, is that the bad are now good. Red Onslaught, née Red Skull, is using the super-powerful brain pilfered from Charles Xavier's corpse to spread hate telepathically around the planet. It apparently has the opposite effect on super-villains, making them perform acts of selfless heroism.

Carnage, introduced in The Amazing Spider-Man in the early 1990s, is serial-killer sociopath Cletus Kasady possessed by the offspring of the Venom alien symbiote. In AXIS: Carnage, Carnage, suddenly compelled to do good, locks horns with Sin-Eater, another super-villain with a Spider-Man origin.

Why Sin-Eater isn't reverse engineered to suddenly do good like Carnage is not explained. Unless the explanation is that Sin-Eater is doing good by blasting the heads off newscasters.

The Sin-Eater character seems to be heavily influenced by Marvel's original Foolkiller. Created by the great Steve Gerber, Foolkiller is an insane, homicidal vigilante that appeared in the pages of Man-Thing during the Watergate era. I loved those comic books as a kid. They seemed to capture what was really going on in the country during the demise of Nixon, the Ford stewardship and the confusion of Carter.

Below you will find scans of the first ten pages of AXIS: Carnage #1. The writing of Rick Spears, the art of German Peralta and Rain Beredo's colors are all workmanlike and adequate to the task at hand, which is to depict a world where heroes are villains; villains, heroes; and the people at the top of the pyramid keep getting more powerful.

Friday, February 27, 2015

Hippies vs. Punks: Velvet Underground's Loaded (1970)

Recently I watched a documentary, The Sacred Triangle: Bowie, Iggy & Lou 1971-1973about David Bowie's Glam/Glitter zenith during his Ziggy Stardust (1972) period and the influence he had (or lack thereof) on the careers of Lou Reed and Iggy Pop.

Several things struck me in watching the documentary, one of which was how totally Lou Reed had surrendered after leaving the Velvet Underground in August 1970. He had gone back home to live with his parents on Long Island, and he was working as a typist at his father's tax accounting company.

It made me want to go back and listen to the last Velvet's album, Loaded.

Reed leaves the band right after recording Loaded the summer of 1970. The album is released November of that year; by that time I imagine Reed is already sleeping in his boyhood bed.

Loaded was one of the first albums I acquired in college after I purchased a new Marantz stereo system. My friend and musical mentor Oliver no doubt insisted that I have a copy. Oliver was a champion of "Sweet Jane"; he thought it was one of the most perfect rock 'n' roll songs ever recorded. I was in agreement. I turned my buddies onto it. They were still in high school back in Southern Oregon. They became mesmerized; taught themselves how to play guitar by listening to it; and eventually formed their own band while still in high school, going so far as warming up for Shockabilly when they rolled through town.

Velvet Underground had been purged by MGM Records after The Velvet Underground (1969). Atlantic Records signed the band to its Cotillion subsidiary with the directive that the Velvets produce a record "loaded with hits"; hence, the satirical title and album cover. But, based on the impact that Loaded had on me and my friends, I would have to say it is an accurate title.

What I have always felt is amazing about the record is that there are all these powerful, flawlessly constructed songs that make up an album that is shot through with a fin de siècle sadness and failure, the sadness of a consciousness standing outside of and commenting on its own corporeal husk.

Just listen to "I Found a Reason" or "Oh! Sweet Nuthin'." Time has run its course on the Hippies 1960s social revolution. With Loaded's repeated send up of country rock ("Lonesome Cowboy Bill," "Train Round the Bend"), Reed saw the end of the Hippie dream several years before the Hippies began filling stadiums to see Lynyrd Skynyrd. The target might not have been Southern Man rock, more likely the San Francisco Sound of the Grateful Dead. But when you hear Doug Yule beautifully sing "Oh! Sweet Nuthin'/You Ain't Got Nuthin' At All" you know the end has come.

Thursday, February 26, 2015

Wisconsin Set to Pass Right to Work, Union Leadership Looks Forward to a Juicy Retirement

The last couple of days the Gray Lady has run stories ("Word of Threat Cuts Short Hearing on Right-to-Work Measure in Wisconsin" by Mitch Smith and "Scott Walker Is Set to Deliver New Blow to Labor in Wisconsin" by Monica Davey and Mitch Smith) about the Republican-controlled Wisconsin legislature moving quickly to pass a right to work law.

The stories are framed in terms of Scott Walker -- a governor who rose to national prominence in 2011 when he supported and signed a law curtailing collective bargaining rights for Wisconsin public-sector workers (with an exception for police and firefighters) -- and Walker's 2016 presidential run.

But the atmospheric backdrop of the two stories is a defeated labor movement. Monica Davey covered the 2011 battle in Madison. Organized labor mustered its troops at the capital but to no avail. Walker prevailed, he signed Act 10 into law, which gutted Wisconsin's public-sector unions, and in so doing he built a national profile for himself.

Davey and Smith open and close their report today accentuating the beaten nature of the unions:
MADISON, Wis. — It was a flashback to 2011: Hundreds of union members in hard hats and work boots waved signs under falling snow, denouncing Gov. Scott Walker and his fellow Republican lawmakers outside this Capitol building on Wednesday. Yet this time, their numbers were smaller, their chants softer. 
As Mr. Walker builds a presidential run on his effort to take on unions four years ago, he is poised to deliver a second walloping blow to labor. After saying for months that an effort to advance so-called right-to-work legislation would be “a distraction” from dealing with larger issues like the state’s economy and job growth, Mr. Walker is now preparing to sign a measure — being fast-tracked through the Republican-held State Legislature — that would bar unions from requiring workers to pay the equivalent of dues.
The State Senate passed the bill, 17 to 15, mostly along party lines, Wednesday night after about eight hours of debate. As the results were announced and senators left the chamber, protesters chanted “Shame” from the balcony. The State Assembly is expected to take up the measure next week. Where Mr. Walker’s earlier high-profile strike against labor cut collective bargaining rights for most public-sector unions, this one is aimed at workers in the private sector. And where Mr. Walker led the drive in 2011, he has taken a far less publicly forceful role this time, saying only that he will sign a bill. Yet the political effect will be the same, burnishing Mr. Walker’s record as an unafraid foe of Big Labor, who has been able to prevail in a state where Democrats have won presidential elections.
Before a crowd of demonstrators that spilled out around the Capitol on Wednesday, Phil Neuenfeldt, the president of the Wisconsin A.F.L.-C.I.O., called out, “We’re back.” He promised, to cheers, “We’re not going to forget about it.” Cold weather, short notice and work schedules may have diminished the crowds, some protesters said, but there was also a sense of inevitability — and of weary déjà vu.
“From day one,” Mr. Finkler, the retired university worker, said, “Walker was all about running for president.” About two hours into the debate on Wednesday afternoon, protesters inside the Capitol had dwindled to several dozen.
Davey and Smith give a succinct definition of right to work:
The measure would allow private-sector workers who choose not to join unions to avoid paying the equivalent of dues, known as “fair share” payments, which union leaders say are reasonable for anyone who benefits from union contracts. The widely protested 2011 law gave most public employees that same right. Neither provision would apply to police officers and firefighters.
Make no mistake, right to work destroys union density wherever it is passed. And with the loss of union density goes any hope of a political force for working people. Wisconsin is set to join Michigan and Indiana, two states of the nation's former industrial heartland that have recently passed right to work. Jimmy Hoffa's spirit is weeping.

And where is the push back from the AFL-CIO? Where is a declaration of resolve, a plan of counterattack, a mass mobilization of all members and political allies? There isn't one. And there won't be one.

Union leaders at the national and local level make six-figure incomes. Their overriding concern first and last is not to upset the apple cart. They can't do mass mobilizations; they can't do large organizing drives. The only thing they can do is turn members out for staged protests on the steps of capital buildings, like they did in Madison in 2011 and the other day, and like they do in Olympia in my home state of Washington. And what Walker has shown along with the Republican legislature in Wisconsin is that this theater can be ignored at very little electoral cost.

Organized labor's failure in Wisconsin should have been a wake-up call to upend business as usual. The fact that it did nothing of the sort is proof that unions are dead men walking, old white guys who are hoping to quietly muddle through for the next few years until they can retire with multiple fat pensions.

The answer -- which is no answer -- that will be forthcoming from the marble halls of the AFL-CIO will be to elect Hillary, no friend of labor. Members will be called on to man the phones and hit the doors. But the members in all their ignorance know better and the turnout for Hillary will be anemic.

Coming down the pike in 2016? Scott Walker, elected POTUS.

Wednesday, February 25, 2015

"Thankful N' Thoughtful"

The end of summer 2012 I was thoroughly immersed in two great Sly and the Family Stone albums from the Nixon-era, There's a Riot Goin' On (1971) and Fresh (1973).

These records -- heavily produced, seamless, narcotic, visionary -- can be played repeatedly.

The end of summer 2012 was very warm. People were sleeping out in the open on patches of grass. I was fit.

I heard "Thankful N' Thoughtful" last week, and I realized the Owl of Minerva has flown. The end of summer 2012 might as well be ancient history let alone as near distant as Nixon-era America.

Neoliberalism Triumphant

The post-mortem on Greece's clash with eurozone finance ministers, the International Monetary Fund and the European Central Bank over terms of its bailout is either a wash (Jim Yardley, "In Greek Crisis, Rare Moment of Consensus") or a loss for Greece (Yves Smith, "ECB and IMF to Greece: No Escaping the Austerity Hairshirt."

Both agree that the can has been kicked down the road and now the Syriza-led government of prime minister Alexis Tsipras has very little room to maneuver, caught as it is between promises to restore pension benefits, collective bargaining rights and undo privatization while it has just signed on the dotted line to implement the troika's structural adjustment which is predicated on cutting pension benefits, rolling back labor laws and fast-tracking privatization.

The collapse of the eurozone, as I had hoped for, does not seem to be in the offing. Neoliberalism remains the dominant paradigm. Despite the planetary crisis of climate change and the spread of war, a forty-year-old paradigm (a decade older than the social-democratic consensus that governed the West following World War Two) shows no sign of giving way to something different. There is no significant rival ideology in the West to neoliberalism. Syriza, a throwback to what would be considered a standard social democratic party of the 1950s and 1960s, had its momentum killed in Brussels.

The only counter to neoliberalism is the epiphenomenon of Wahhabism. One begets the other, a yin and yang thing.

But there is always the problem of overreach. The U.S. overreached in Ukraine. And it can't seem to admit defeat. Next up is Iran, the conclusion of negotiations on its nuclear program and Netanyahu's coronation in Congress.

Tuesday, February 24, 2015

"Willie Mays Aikens" Muttered To Myself After Waking

For some reason I woke up last night after being asleep for only 30 minutes. The name on my lips was Willie Mays Aikens, the former Kansas City Royals slugger who served 14 years in prison for selling cocaine (and possessing a loaded gun at the same time).

I have absolutely no idea how Willie Mays Aikens dropped into my consciousness at that moment. I think I must have been dreaming about the time that George Brett went apeshit during a game at Yankee Stadium in 1983, what has come to be known as the "pine tar incident." That year Aikens had a career-high 23 home runs for the Royals.

Who knows what sort of neural chemistry belched forth that memory, and from that memory to the name "Willie Mays Aikens." It is something akin to magic.

Syriza's About-Face and Why We Should Stomach It

Yesterday, a Monday back at work to begin another week in a series of weeks that will lead eventually to May and Memorial Day, the sense of hopelessness and fatigue was palpable. I kept checking for signs of life from Brussels, wishing that Syriza had discovered a path forward to foil the eurogroup of finance ministers and their neoliberal austerity.

But no such luck was mine. The reporting was sparse and eventually, I think it was late morning Pacific Standard Time, it was reported that Greece would submit her proposals Tuesday morning, today.

First reports (James Kanter and Niki Kitsantonis, "European Lenders to Review Greece Overhaul Plan") this morning are not encouraging:
Jeroen Dijsselbloem, the head of the Eurogroup of finance ministers, that he could not yet give a “positive assessment” of the list submitted by Athens, as the overhauls first needed to be reviewed for their effects on the Greek budget. A conference call among the 19 finance minister of the Eurogroup was set for Tuesday afternoon.
“I think they are serious,” Mr. Dijsselbloem, referring to the attitude of the government in Athens, told lawmakers on an influential economics committee at the European Parliament during scheduled testimony on Tuesday.
Among the overhauls are plans to improve management of the national budget, and to enact changes to Greece’s taxation system, including changes to the collection of sales taxes “with a view to limiting exemptions while eliminating unreasonable discounts,” according to a letter that Yanis Varoufakis, the Greek finance minister, submitted to Mr. Dijsselbloem.
The government also committed not to reverse existing privatization plans and said it would review planned sell-offs with a focus on bolstering “the state’s long-term benefits.”
In addition to streamlining the public sector, the government will review public spending at every level and will modernize the pension system in an effort to end “an excessive rate of early retirements.”
The country still plans to raise the minimum wage, one of the government’s pre-election promises, but pledges to do so in a way that safeguards competitiveness, the letter said.
The opportunity for Greece to submit the proposals was one of the few concrete concessions it won in an accord reached with its creditors late on Friday in Brussels. That accord brought to an end the bitter standoff that began when Prime Minister Alexis Tsipras pledged to redraw or scrap the bailout agreement after he came to power in January.
European and Greek officials spent much of Monday exchanging drafts of the proposals to pare back austerity measures while ensuring that Greece can still meet fiscal obligations.
The government of Mr. Tsipras had an opportunity to put its “political stamp” on a bailout plan if it respected budget targets, Mr. Dijsselbloem told the parliamentary committee.
The deal to extend the country’s bailout program with European creditors by four months is subject to the approval of the Greek Parliament, where members of Mr. Tsipras’s radical-left Syriza party have called the plan a capitulation after the party’s anti-austerity campaign promises.
Also on the list submitted by Mr. Varoufakis are plans to crack down on the smuggling of fuel and tobacco, which cost the Greek economy billions of euros a year, to address tax arrears and nonperforming bank loans, and to support struggling homeowners who are unable to meet their mortgage payments.
The overhauls will also address what Syriza has described as Greece’s “humanitarian crisis,” referring to the need for food stamps and other assistance to poor families, but Athens said the measures would be mostly “nonpecuniary” and would have “no negative fiscal effect.”
You will recall shortly after Syriza's victory at the end of January the consensus opinion was that Tsipras would be unable to crack the troika's austerity diktats; that the best Greece could hope for was a few scraps of social-welfare spending tossed from the master's table. Then Syriza's finance minister Yanis Varoufakis went on the offensive against the cruel fiction of neoliberal austerity and the fantasy that governments can cut their way to growth. Commentators zipped their lips. Maybe little Greece was going to shake up the neoliberal consensus.

Well, it appears the original conventional wisdom is going to be proven true.

The commitments to existing privatization plans and streamlining the public sector (highlighted in red in the Kanter and Kitsantonis story above) are truly ominous and confirm the view that Tsipras and Varoufakis have indeed performed an about-face. In a post yesterday, "Eurogroup to Review Greek Reform Proposals; Meeting Set for Tuesday (Updated)," Yves Smith is troubled by the Greek proposal's commitment to EU "best practices" on labor:
“EU best practices” on labor is very disconcerting, since it implies a forced embrace of “labor flexibility” as in further reduction of labor protections and bargaining rights. That would seem to be inconsistent with earlier reports, including a government announcement, that Greece was seeking an increase in the minimum wage. Perhaps that section is more of a mixed bag than the headline for that section suggests.
After the work day was done yesterday, a co-worker, the only one who really pays attention to the news, offered me a ride to the train station. I tried to explain why I felt that even though it would be damaging to us -- because our retirement is in the form of a 401(a) defined contribution pension plan that floats along the waves of the market, and the markets would most likely freak out in a bearish direction upon Greece's leaving the eurozone -- and damaging to the citizens of Greece I wanted to see the eurozone come tumbling down.

I don't think I was very articulate. What I said was something to the effect that if the eurozone cracks then U.S. hegemony is diminished. For instance, the ability of the United States to stampede the EU into Cold War 2.0 by sanctioning Russia becomes much more difficult. And this has to be considered a desirable outcome. No one wants to be incinerated in a nuclear war.

But is this true? If Greece is forced to leave the eurozone -- which I don' think is going to happen, unless Syriza MPs revolt -- does this necessarily mean Greece leaves the European Union? I don't think it does. But even if it does, and Greece is cast out entirely from all European institutions, how does this lessen U.S. foreign policy leverage on the remaining European Union states? It doesn't.

Rather, Syriza can exert more influence, even if only as a "fly in the ointment," if Tsipras and Varoufakis keep Greece in the eurozone and the EU. The EU operates by consensus. Greece can block the TTIP and future Russian sanctions, two big pieces of juicy fruit.

For a not very effective apologia of Syriza's about-face there is Mike Whitney's "Varoufakis Keeps Greece in the Eurozone, by its Fingernails: A Valiant Effort." Whitney brings up an argument I have seen elsewhere: that Varoufakis' negotiations with the eurogroup will be enormously successful so long as he is able to keep the Greek primary surplus target frozen at 1.5 percent:
The new deal also allows Greece to decide its own reform package rather than the troika dictating what government expenses to cut or which publicly owned assets to sell.  Here’s another excerpt from Haring’s post:   “Most important change of the whole document: Addition of 'The institutions will, for the 2015 primary surplus target, take the economic circumstances in 2015 into account.' Excessive, self-defeating austerity is off.  Only the target for 2015 is mentioned, because everything further out would have to be part of a new arrangement, still to be negotiated.”
So Varoufakis has achieved his goal of reducing austerity. Not only is there greater flexibility operationally but, also, Greece will control the levers of decision-making  in the “field of tax policy, privatisation, labour market reforms, financial sector, and pensions”. Naturally, the lower the primary surplus, the more fiscal stimulus is available for economic growth. (Running a surplus during a depression is absolute madness, but this is the lousy hand Varoufakis was dealt.)
Haring’s final comments are a good summary of Varoufakis’s achievement:
“Was it worth the hassle to reject the draft of 16 February, just to accept the statement four days later? For Athens it most certainly was. It got the promise that no self-defeating, excessive austerity would be asked of it any more, the assurance that it could devise its own economic and social policies, as long as they did not impact negatively on the interests of its partners, rather than having to execute and leaving in place all the measures accepted by the former government and strongly rejected by the people. These are huge improvements for Athens, with no significant counterbalancing downside compared to 16 February.”  (“Was it worth it? Concessions to Greece relative to the rejected draft of 16 February”, Nobert Haring)
A reduction in the primary surplus is a big win, no doubt. But we need to wait and see if that is something that Varoufakis really achieved.

For the time being, I am keeping my eyes focused on the veto power a Syriza-led Greece will hold over operations in Brussels going forward. "Better to run away and live again to fight another day."

Monday, February 23, 2015

Grexident vs. Kicking the Can Down the Road

Since Friday the Syriza-led government of Greece has suffered a blow to its public image; it was then, despite weeks of avowals to the contrary, that Greek finance minister Yanis Varoufakis signed a troika memo committing his country to the creditor-dictated austerity program accepted by previous Greek governments.

While there was confusion and despondency in the blogosphere over Syriza's capitulation, there was some gloating in the mainstream prestige press. The opening to "A Deal That Preserves Greece’s Place in Eurozone, and Fiscal Restraints" by Andrew Higgins (well known to readers who have been following for the last year the U.S.-engineered coup in Kiev and the subsequent civil war in the Donbass as a reporter who will parrot the grossest of lies) provides a good example of "There Is No Alternative" schadenfreude:
BRUSSELS — Just a month ago, after being propelled to power by a wave of anger at Greece’s economic miseries, Alexis Tsipras declared his left-wing Syriza party’s election victory the start of a Europe-wide revolt against austerity. “Europe is going to change,” he said before setting off on a tour of European capitals to rally support for a more relaxed new direction. 
The “anti-austerity revolution” proclaimed by Syriza and its fans elsewhere, however, has now fizzled, its passions doused by the political reality that leaders in the rest of Europe do not want to join or, more important, finance the Greek-led revolt.
Yves Smith of Naked Capitalism has been pessimistic from the very beginning regarding Syriza's chances of re-working the troika's austerity program. Her Saturday "morning after" assessment, "Benchmarking the Greece/Eurogroup Bailout Memo and Process," was grim:
General Observations
There is no way of putting a pretty face on this document [the memo released yesterday by Greece and the europgroup]. It represents a huge climbdown for Syriza. Despite loud promises otherwise, they’ve agreed to take bailout funds, and the top and the close of the memo confirm that the baillout framework is still operative (emphasis ours):
The Eurogroup notes, in the framework of the existing arrangement, the request from the Greek authorities for an extension of the Master Financial Assistance Facility Agreement (MFFA), which is underpinned by a set of commitments. The purpose of the extension is the successful completion of the review on the basis of the conditions in the current arrangement, making best use of the given flexibility which will be considered jointly with the Greek authorities and the institutions…
We remain committed to provide adequate support to Greece until it has regained full market access as long as it honours its commitments within the agreed framework.
Even writers who take a positive view of what Syriza accomplished are under no illusion as to how far short Syriza has fallen relative to its lofty promises. From Paul Mason’s blog:
I asked Dijsselbloem in the press conference: “What do you say to the Greek people, whose democracy you’ve just trashed.” He replied that he did not think that was a very objective question. We’ll have to agree to differ.
There is also language in the memo that looks to authorize the return of the Troika monitors: “In this context, the Greek authorities undertake to make best use of the continued provision of technical assistance.” The Financial Times reads it the same way:
It also leaves the IMF and EU institutions — the European Central Bank and European Commission — in control of evaluating Greece’s economic reform measures and the disbursement of bailout funds, despite Mr Tsipras’ vow to rid Greece of the hated “troika” of bailout monitors.
Mind you, despite the foregoing, it is doubtful that Greece could have done much better, particularly in light of the way the ECB had worked to intensify the already-in-progress bank run and boxed the Greek government in by giving it only a thin increase in the ELA limits. A contact told me the Greek government would have had to impose capital controls over the weekend in the absence of a deal; the Financial Times reported close to the same thing by stating that Greece was on track to hit the limits of the ELA on Tuesday (the day after a long holiday weekend). And let us not forget that the Greek government is also slotted to run out of cash by February 24.
Then her conclusion:
In sum, it looks very likely that the top priority of the Troika will be to get Syriza to delineate in detail what they intend to do in the way of the 70% of the structural reforms that Varoufakis said that they and his counterparts already agreed to, and only throw a few bones on the humanitarian front out of the other 30% that Varoufakis wants. And if you’ve ever been party to legal agreements, more specific commitments operate to the disadvantage of the party making them.
Moreover, Syriza has already shown a propensity to overpromise and underdeliver. That would be likely to happen independent of what looks like an optimism bias among the leadership team merely by virtue of inexperience, as in underestimating how long it takes to change bureaucracies and design and launch programs.
As I have said, I would be delighted to be wrong, but even if the ambiguities in the memo language all resolve in Syriza’s favor, they have a mammoth task in what is achieving what is set forth in it, and an uphill battle in meeting the Troika’s and the Eurogroup’s reform expectations. I wish them the Greek government the best of luck.
Varoufakis yesterday submitted a draft proposal of reforms that his government plans to implement. The deadline for that proposal is today. Yves Smith comments this morning, "Troika Not Happy with Initial Draft of Greek Reforms; Eurogroup Reported Still in the Mix," that Varoufakis was wise to get his list in early because the troika is not satisfied by its level of specificity; she raises the possibility that the deal could still unravel, giving way to a sloppy "Grexident," though she sees the European Central Bank, the institution that has been steering negotiations behind the scenes, as exerting force on the eurogroup to accept Greece's proposal:
In any event, there is still the possibility that we could see a disorderly Grexit, or what one account called a “Grexident,” an exit triggered by mistakes rather than design.
However, with the ECB not afraid to invoke the Market Gods to beat the Eurogroup into line, the odds favor them using the same approach even if the Greek draft is not up to Troika working staff and/or Eurogroup standards, pushing them to sign off despite reservations.
But if that is how things play out, it would be a mistake to consider it a Greek win. Remember this is only the first step in an interim deal where Greece has to meet other Troika and Eurogroup targets, as well as work on the even more important task of negotiating what happens when other debt matures over the summer. The more that the Troika and Eurogroup continue to think that Syriza is not willing or capable of meeting its demands, the more any ambiguity in the memo will be resolved against Greece, except in those instances where a favorable resolution for Greece happens to coincide with what the Troika wants to do regardless. Similarly, the less smooth the process over the non-bailout baillout period, the less likely the creditors, which includes the Eurogroup, will be likely to be accommodating in negotiation over longer-term arrangements.
Reasonable or not, Greece has been put in the unfortunate position of having to appease its creditors to get any further breaks. They thus need to be good austerity designers and enforcers over the near term. That also means that remarks by Greek officials to the international media that look to be attacking the Troika or fomenting opposition to austerity in other debtor countries with governments that are making their citizens wear the austerity hairshirt would also be treated as demerits.
Thus, unless there is a serious procedural mishap on Monday and Tuesday, Varoufakis is very likely to be proven correct that his revised list of reforms on Monday will be accepted. But how bumpy that process turns out to be has significant implications for the long-term success of his effort to keep Greece in the Eurozone. The flip side is that there is the potential that even if this week is rocky, the Greek government could recover ground with its official minders once it does get control of the government, but it will need to be cognizant of how far it needs to go.
Thus no matter how you look at it, the new Greek government has a gauntlet to run between now and June. And as much as we’ve stressed that a Grexit is almost certainly an even worse outcome than acceding to the Troika’s demands, it is important to recognize that the best cases scenario for Greece is getting austerity lite as opposed to austerity regular. Even Varoufakis’ target of a primary surplus of 1.0% to 1.5% is still contractionary. Bill Mitchell estimates that Greece will need to run budget deficits of 10% of GDP to restore its economy to a semblance of normalcy. The US had unemployment levels in the Great Depression that were comparable to Greece’s now and have to run a much higher lever of deficit spending to pull the economy out of the ditch for good. 
Thus all of these hard-fought efforts by the Greek government are to eke out gains that don’t even begin to reach the level of intervention that Greece needs. So it isn’t simply that last week’s memo is yet another example in a long series of the European elite’s fondness for “kick the can” solutions to pressing problems. It appears that if Greece is indeed the recipient of new and improved flavor of austerity, it’s a higher-order delaying tactic meant to buy years more of sullen acquiescence from long-suffering citizens in periphery countries. 
This analysis sounds correct to me. Dominant neoliberalism survives by maintaining the paradigm at all costs. That is why Syriza has to be crushed even though what Varoufakis has been telling anyone who is willing to listen -- that paying off Greek debt by means of austerity is a cruel fiction -- is widely acknowledged to be true. Better to kick the can down the road and pretend that everything is going to work out.

One scenario that Yves Smith does not entertain, but one taken up by James Kanter and Niki Kitsantonis, "Greece’s Leaders Face a Revolt at Home as They Try to Appease Creditors," is that Syriza's parliamentary majority will fracture over the deal with the troika:
The deal reached Friday allows Mr. Tsipras to ask to drop austerity measures to which the previous government committed but never enforced, such as further cuts to pensions, an increase in a special value-added tax on the Greek islands and the relaxing of restrictions on mass dismissals in the private sector.
In return, Mr. Tsipras and his government are expected to propose other, chiefly structural changes, including some actions that the previous government failed to deliver on, such as a crackdown on tax evasion and corruption.
Such changes, if accepted, might ease the burden on the majority of Greeks who have been hit by austerity over the years, and shift more of it to the rich and privileged who have emerged from the crisis relatively unscathed and who, creditors insist, should shoulder part of the solution.
Indeed, many now expected that the government would propose changes aimed at helping those hit hardest by years of austerity in Greece, perhaps by raising low-income pensions. On Sunday, the changes seemed to be headed in the direction of focusing on a crackdown on tax evasion and corruption, and an overhaul of the public sector, a government official said.
If Greek lawmakers do not like the deal, they can vote it down. The coalition government in Athens has 162 seats in the 300-member House.
Even as government officials scrambled to complete the list and an accompanying analysis demanded by creditors, there were indications of internal dissent, with many prominent members of Syriza saying Athens should not give in to creditors.
Giorgos Katrougalos, the minister for administrative reform, told Greek television he would resign if “our red lines were not respected.” He said several of the pre-election pledges that brought Mr. Tsipras to power were not up for negotiation, including the rehiring of thousands of dismissed civil servants.
Manolis Glezos, a veteran Greek leftist, denounced backtracking by Syriza and suggested that the party’s leadership had deceived voters by bending to demands by Brussels and by agreeing to prolong the previous program.
"I apologize to the Greek people because I participated in creating this illusion,” Mr. Glezos, a member of the European Parliament, wrote on a blog, Active Citizens Movement, run by a group within the Syriza party.
Mr. Glezos called on “members, friends and supporters of Syriza” to “react before it is too late” by holding emergency meetings at all levels “to decide if they accept this situation.”
A government official responded that Mr. Glezos “may not be well-informed on the tough and laborious negotiation, which is continuing.”
Another group within Syriza, called Communist Tendency, on Saturday described the Eurogroup deal as “submission to the blackmail of the troika” and called on lawmakers to oppose it in Parliament.
Sofia Sakorafa, another member of the European Parliament for Syriza, wrote on her Twitter account on Sunday, “The people gave a mandate for the memorandum to be annulled” and “we have no political justification to do the opposite.”
Clearly not good for Syriza. Whether a Syriza-led government can survive I don't think is the question. I think it can, even if there are some very acrimonious resignations and public recriminations. The question is what kind of government Syriza is going to be. Another Obamaesque "Hope & Change" charade or a popular movement to crack the neoliberal paradigm?

Hugo Dixon of Reuters has a piece today, "Greece Needs to Embrace Radical Reform," urging Tsipras to go all in fulfilling the troika's demands for structural reform, going back to the voters again if need be:
Mr. Tsipras now has to present his own list of reforms by Monday evening. He must resist any temptation to come up with half-hearted proposals that might appease his extremist colleagues.
Instead, Athens should propose radical reforms that the previous conservative-led government was too conflicted to embrace. It should surprise its eurozone partners with its zeal and so help restore their trust.
Mr. Tsipras has long said he wants to combat tax evasion, corruption and special privileges, as well as rein in the oligarchs who control swaths of the economy and stifle enterprise. Now is his chance to prove he means business.
At the top of Athens’ list should be the creation of a genuinely independent tax authority. The last government, led by Antonis Samaras, sacked the authority’s boss. Buttressing it with strong legal safeguards would show that Mr. Tsipras was serious about tackling tax evasion.
The prime minister should also promise to remove tax and social security privileges enjoyed by the rich. For example, judges, generals and senior civil servants should have to wait for their pensions as long as ordinary people.
Similarly, the Greek Orthodox church should lose its exemptions from the country’s unpopular property tax. Nor should the government continue to pay for priests’ pensions and salaries. The church should offer to fund them itself.
Mr. Tsipras should also revive an idea, discarded by Mr. Samaras, to tax the country’s rich ship owners. It is astonishing that they slip through the tax net.
Next on Athens’ list should be liberalizing markets, which are still gummed up by restrictive practices. This would attract investment and give consumers a better deal. 
Mr. Tsipras should also set up a “bad bank” along the lines of what Spain and Ireland have done successfully. Separating nonperforming loans would not just free the banks to provide credit to the economy, it could also help clear up corruption, as many of the bad loans are provided to oligarchs who are clever at pressuring the banks not to foreclose on them. 
There is understandably some fear that a bad bank could end up as a backdoor means of helping corrupt businesses, by writing down their loans while letting their current owners stay in control. 
Greece’s creditors have the country on a short leash. They have not said how they will provide Athens with the money to stop its going bust next month. They have dangled the possibility of relaxing the punishing fiscal austerity but haven’t said by how much. 
If Mr. Tsipras can surprise his eurozone partners with radical reforms, they will be more willing to find Athens the cash to avoid bankruptcy, probably by letting it sell more short-term treasury bills to its banks. They will be more likely to relax the fiscal squeeze, allowing the government to fund some of its more pressing antipoverty policies. They will also be more amenable to relieving Greece’s vast debt burden, an idea currently on the back burner. 
It will not be easy for Mr. Tsipras to do all this, both because of his far left colleagues and vested interests that support his party. But he is popular enough to do this, especially if he secures a new mandate with a referendum or a second election. Now is the time to break with factions and side decisively with the Greek people.
This is the classic "triangulation" move from the neoliberal playbook perfected by both Bill Clinton and Tony Blair. Run against your own party. It is not going to work here. Syriza, like Podemos, is a recent political formulation, which means it is still connected to the rank and file. Tsipras couldn't split his own party without it collapsing.

Which means a Grexident is not out of the question at this point, though, like Yves Smith, I don't see how the neoliberal can does keep getting kicked down the road.

Sunday, February 22, 2015

The Colt 45 Chronicle #86

There is frost on the rooftops this morning. It might be the first time we have had frost in 2015. It has been a bizarre year so far weatherwise. Warm and relatively dry.

The frost is keeping me indoors when normally I would be out on the road by now. I'll wait until the sun warms things up before heading out for a run.

In the meantime, here is the follow-up letter to the one posted last week that described the drinking bout between me, my friend Erik, my wife and Erik's temporary girlfriend; it is just a little thank you note.

These old letters are almost finished. I should be doing a better job of summing up what I think now looking back on them over 25 years later they all mean.

Certainly, one might say, "primarily," these letters reveal a young man in the thrall of alcohol. Hence, the title of these posts, an homage to the malt liquor I drank while I typed.
Summer 1989
Thanks for the card. They were cheetahs, right? I guess that's why CHEETOS CHEESE PUFFS uses a cartoon cheetah in its TV advertisements (because of the "chee-" similarity). Anyway, I'm popping off this tiny epistle to say that we should stay in touch, that I had a good tine when you guys were up, and that I look forward to touching base in the future.
The truth probably boils down to the fact that the Earth rotates and we die, or, in different words, we're always already getting a touch closer to the tomb. That's why memory is so important. It gives you a nice spot of lawn to rest on while you journey to the big spanking. That's why I liked your visit so goddamn much -- because it was memorable. I don't know if it was the malt liquor or the wet boots or my lack of work. Whatever it was, it was good.
Hope to see you again and pretty soon.

Saturday, February 21, 2015


As far as I know AXIS is the latest, and yet to be succeeded, Marvel crossover event. It has already run its course. But I am just catching up with it. Last weekend I got as far as AXIS #2. Rick Remender, who I often rave about on this page, takes his shot at scripting the hub storyline of a crossover. Adam Kubert provides the art. The narrative, as recapitulated in the second scan, seeks to tie up the AvX crossover, which concluded with the death of Professor X and a spontaneous outbreak of new Mutants. Red Skull has pilfered the super-powerful brain from Professor's X's corpse and used it to spread hate globally with the intention of wiping out Mutantkind. In AXIS, the Red Skull is reborn as Red Onslaught, a colossal mind-controlling telepathic demon.

All the action in AXIS #1 & AXIS #2 takes place in the Mutant homeland of Genosha, an island off the coast of Africa north of Madagascar. It has the feel of the climax of a Hollywood action blockbuster where the final fight scene always seems to take place in an abandoned warehouse.

To make a long story short, AXIS is a big disappointment. Maybe it will improve. I don't know. But the first two issues are extremely weak. Adam Kubert's art is juvenile; Remender's writing, exhausted.

Marvel's crossovers seem to be multiplying and getting weaker with each new iteration. The heyday, what really drew me back to reading comic books, was the strength of Brian Michael Bendis' Secret Invasion, Dark Reign and Siege crossovers as each led organically into the next. The storytelling was inventive and impactful.

And while there were one or two nice installments in Matt Fraction's Fear Itself, it has become increasingly apparent with AvX and Age of  Ultron that a commercial format is preceding any meaningful substance. Now Marvel appears to be committed to running two crossover simultaneously -- for instance, AXIS and Original Sin --  something which I don't think can be sustained.

The executives of Marvel seem to be of the mind that they can do it all: the crafty, compelling, fresh features of All-New Marvel NOW! as well as the bloated big ticket blockbuster like AXIS. I am doubtful. Eventually the reader's allegiance will evaporate.

In the scans below from AXIS #2 Iron Man battles Sentinels he secretly designed to exterminate all his brother and sister superheroes. Red Onslaught has acquired control of the Stark Sentinels.

Friday, February 20, 2015

Hippies vs. Punks: The Clash's Combat Rock, Pt. 3, "Overpowered by Funk"

Something has been lost. My first year of adulthood, my first year living alone was my freshman year at the university. The year was 1982, the year The Clash released Combat Rock.

Combat Rock is widely accepted today to be the beginning of the end of a great band. Conventional wisdom holds that the album is a radio-friendly sop to commercialism.

What cannot be denied is that Combat Rock is the last record featuring the band's main lineup -- Strummer, Jones, Simonon, Headon. The final studio album of The Clash, the universally panned Cut the Crap (1985), is minus Mick Jones and Topper Headon. The former, sacked by Strummer and Simonon over creative differences; the latter, because of his drug addiction.

I think dismissals of Combat Rock are off the mark. I think appraisals that class the record below the band's eponymous debut or the double album London Calling (1979) are largely due to Combat Rock's massive popularity and crossover appeal. For the most part, smart-set taste-makers eschew anything that has mass-market appeal.

But back to this idea that something has been lost. Last October I wrote about sitting in Dwinelle Plaza next to gridiron star Ron Rivera (now head coach of the Carolina Panthers) at the beginning of the 1982 school year and listening while he sang "Should I Stay or Should I Go" to himself. If one compares the Congressional midterm elections that year, 1982, with the midterms that transpired shortly after the Ron Rivera post, 2014, one sees a country that is no longer a Democratic Party majority.

The Democratic Party swept the 1982 midterms in the popular vote 55% to the Republicans 43% owing to the unpopularity of the Reagan Recession. In 2014 the Republicans won a bare majority of the popular vote, 50.9% to the Democrats 45.3%. But the Republicans actually have a greater majority of House seats now -- 247 -- compared to what the Democrats had in 1982 -- 243.

So in the 32 years of my life as a voting, tax-paying adult citizen of the United States, the nation has done a flip. We are no longer an egalitarian-minded, working-class nation, or at least that is what a reading of the poll results tell us.

Another way to look at this loss is by the results of the radical leftist 1960s-spawned Peace and Freedom Party. The Peace and Freedom Party, which was ubiquitous in my lower division years as an undergraduate at the University of California at Berkeley, a presence I lazily took for granted, won 34,422 votes in 1982 and competed in numerous California Congressional Districts; in 2014, the Peace and Freedom Party polled 9,192 in the midterms.

The Peace and Freedom Party from its inception has been concerned with racial justice. The party planned to support Martin Luther King, Jr. for president in 1968 but chose Eldridge Cleaver instead because of MLK's support for mustering the National Guard to handle the Detroit riots.

The Clash as a band always acknowledged the influence of Black artists, for instance the collaboration with Mikey Dread.

One of the tracks that adds depth to Combat Rock is "Overpowered by Funk," The Clash's homage to early hip hop artists Grand Master Flash and the Furious Five and Sugarhill Gang. Joe Strummer raps "Funk Power" with graffiti artist Futura 2000.

Combat Rock is basically released the same time as Grand Master Flash and the Furious Five's The Message (1982). I owned both. Popular music was never the same after "The Message":

To me, listening to "Overpowered by Funk" again, it reminds me less of "The Message" and more of Tom Tom Club's "Wordy Rappinghood," which preceded Combat Rock by one year. Both showcase Punks (in the case of Tom Tom Club, the husband and wife rhythm section of Talking Heads) taking a stab at hip hop:

There was a lot of sunshine and hope back in the first few years of the 1980s, even with the tentacles of neoliberalism taking hold amid the Reagan Recession.

Undoubtedly we were naive. Look we were are now with money power all but completely victorious.

But for that moment there appeared to be enough time and space where racial harmony was possible.

Thursday, February 19, 2015

Grexit + Serious Trouble in Kiev

Greece has asked for a six-month extension of its loan agreement with the troika (Niki Kitsantonis and James Kanter, "Greece Requests Extension of Loan Agreement and Meets Resistance From Germany"). A meeting will be held tomorrow afternoon in Brussels between eurogroup chief Jeroen Dijsselbloem and Greek finance minister Yanis Varoufakis. They will attempt for the third time to arrive at an understanding.

The question, as explored in depth this morning by Yves Smith, "Obama Administration Throws Greece Under the Bus; ECB Leak Recommends Capital Controls; Greece Weighing Capitulation," is whether Greece's six-month extension request is a capitulation to the troika's austerity demands. Smith sees it as such:
Things are not going well for Greece. It appears Syriza has largely capitulated to the demands of the Troika. Greece has submitted a request for a loan extension that the Eurogroup will consider Friday. From ekathimerini:
Government officials on Wednesday worked until late finalizing a proposal…
Specifically the government is expected to seek an extension to the so-called Master Financial Assistance Facility Agreement, the official name for the European Financial Stability Facility’s loan contract. That contract stipulates, however, that the dispensation of financial assistance is dependant on Greece honoring the terms of the so-called memorandum, which contains the economic reforms that the previous government committed to and which the current SYRIZA-led coalition has contested. Indeed, former Prime Minister Antonis Samaras had made the same request in December last year when he sought to extend the European part of Greece’s bailout program, from the end of the year to February 28. Kathimerini understands that Samaras’s request had then used the words “technical extension to the existing Master Financial Assistance Facility Agreement,” the same phrase that the new government was said to be considering last night.
The compromise is expected to satisfy both sides as it would mean Athens can avoid using the phrase “extension of the existing program” and the creditors can avoid using the term “loan agreement.” In substance, however, there would be little difference from the extension sought by Samaras as the terms of the memorandum would have to be respected in order for rescue loans to be disbursed.
This means that Greece is effectively asking for an extension of the bailout, which is what it had refused to do. And that means keeping the “conditionality” as in privatizations and labor-crushing structural reforms, intact. Greece is still fighting to keep some flexibility there but it is not clear they will obtain much. Again from ekathimerini:
The European Commission’s vice president for eurozone affairs, Valdis Dombrovskis, said efforts were under way to reach a compromise by finding “common ground for an extension of the current program.”
He insisted that “the best way forward is to extend the existing program with its conditionality.” Dombrovskis noted, however, that if Greece wants to substitute some of the existing measures in the memorandum with alternatives, it could do so.
In other words, this is a “peace with honor” solution.
Smith then goes on to list what led to the presumed capitulation: 1) the Syriza-led government was abandoned by the United States (no surprise there); 2) Greece is going to run out of a cash February 24, much earlier than originally anticipated; and, most importantly, 3) the European Central Bank (ECB) is fanning a bank run and then restricting the amount of Emergency Liquidity Assistance (ELA) that Greece could tap (basically, the ECB has been working to crater the Greek banking system to force Tsipras and Varoufakis to kneel).

The problem for the troika is that clearly Greek's Syriza-led government has no intention of implementing the austerity diktats contained in the loan memo. Can you imagine a situation in Athens (approval for Syriza is sky high) where Tsipras starts taking bids on publics assets and issuing pink slips to government workers? It is not going to happen.

If there is any wiggle room in the six-month extension document, Dijsselbloem will try to eliminate it. For one, Greece insists that the troika's auditors will not be welcomed back to Athens to oversee implementation of the diktats. According to Yves Smith,
[I]t may be that even the concessions that they are apparently prepared to offer will not be deemed sufficient. For instance, it does not appear that Syriza has agreed to let the Troika monitors back in, one of the five demand seen as critical by the Germans. And even though the European Commission spokesperson Valdis Dombrovskis said there might be some negotiating room on specific conditions, that is also inconsistent with the FAZ description of the German stance. Recall that it was a European Commission trial document that Varoufakis said Greece was willing to sign but was firmly nixed by the Eurogroup. 
So it may be that this last round of concessions is meant not as a capitulation but to demonstrate how much Greece was willing to give in the face of implacable Eurogroup demands and was still rebuffed. We’ll know the outcome either way shortly.
This has been my feeling all along about the underlying strategy of Syriza. Syriza is a pro-EU party. Varoufakis spoke eloquently and sincerely -- and in an impromptu manner -- about European unity during his Monday press conference. But if Syriza can prove that the status quo is irrational, which Varoufakis has made some headway communicating over the last several weeks, then a Grexit and the resulting turmoil will not be blamed on Syriza but on the troika.

Kitsantonis and Kanter are reporting that Germany is opposed to Greece's six-month extension request:
Germany is probably the central eurozone member in [Friday's] proceedings, and a German Finance Ministry spokesman, Martin Jäger, said in a statement on Thursday that the letter from Athens was “not a substantial proposal to resolve matters.” He added: “The written document does not meet the criteria agreed in the Eurogroup on Monday.”
Germany's intention is to break Syriza, de-legitimize it. Smith said the German ambassador to Greece requested that Varoufakis be replaced as finance minister. Germany sees Greece as a serf in bondage, and Germany will not accept an outcome that places the nations on equal footing.

The temptation in the West to interpret every relationship as one of lordship and bondage is on display in Ukraine. The junta's loss in Debaltseve is clearly a turning point. The Ukrainian Army which was cracking prior to Debaltseve (to the point that the Gray Lady was reporting plans floated in Kiev to create a brand new army) will probably not be able to recover from the rout it suffered this week. The Saker outlines the Debaltsve turning point as follows:
The real problem for Kiev is that more or less all of the current line of contact can become a potential counter-offensive point for the Novorussians who, by the way, have never concealed their desire to get back all of the historical Novorussian lands. So while the current (relative) cease-fire is all nice and dandy, I think that by this spring, when the Novorussians will have reinforced their infantry with up to 100'00 more men the situation for the Kiev regime will become absolutely horrific and no amount of US weapon deliveries will change that. This might well be the beginning of the end for the Nazi experiment in Kiev. 
The implications for the AngloZionist empire are rather clear: if the 1%ers have any kind of sense of reality left, they should toss out Poroshenko and the rest of the crazies and foster some kind of government of technocrats in charge of drafting a new constitution and organizing a referendum on federalization simply because the folks in Kiev better negotiate while there still is something left to negotiate then to way to be hiding in a surrounded bunker like their hero Hitler did. Alas, I don't think Uncle Sam or the Eurocretins have any common sense left in them. 
Whatever may be the case, by the ballot or by the bullet, but we *are* winning.
With the Ukrainian Army mortally wounded, Poroshenko is trying to get UN peacekeepers introduced to Donbass. Russia has nixed the move.

Would the U.S. try to piece together a "coalition of the willing"? I don't think so; such a move would invite an enormous Russian response.

No, Kiev's days are numbered, and so too apparently the eurzone's.

Wednesday, February 18, 2015

Germany's Reaction to NAF's Victory in Debaltseve Bad Sign for Greece

Debaltseve has fallen to the Novorossiya Armed Forces (NAF). What is interesting about David Herszenhorn's story, "Ukraine Forces Withdraw From Debaltseve, a Strategic Town," is he doesn't let on to where the Ukrainian Army is planning to retreat. 
Andriy Lysenko, a spokesman for the Ukrainian national security and defense council, confirmed the retreat at a briefing in Kiev, the capital, on Wednesday afternoon, and said that the pullout was nearly completed. 
“Today, the armed forces of Ukraine are conducting the organized, planned retreat of units of forces of the antiterrorist operation from the city of Debaltseve,” Mr. Lysenko said. “At the moment, almost 80 percent of the Ukrainian units have retreated from this sector, and this operation is to be completed soon.”
Herszenhorn doesn't mention in his story that Debaltseve is encircled by the NAF. There is nowhere for the Ukrainian Army to flee. But in a story yesterday by Andrew Kramer, "Despite Ukraine Truce, a Battle That Continues," it is clear Poroshenko's troops are surrounded and in deep trouble:
As many as 8,000 Ukrainian soldiers are holed up in the city, a rail hub connecting the capitals of the two rebel regions, Donetsk and Luhansk. Rebels have reportedly sent text messages to phones in the town, telling the soldiers that they have been abandoned and should surrender.
The Ukrainian government maintains that the town was not surrounded before the cease-fire took effect, and that European monitors of the truce should insist that the separatist forces halt their offensive and open a corridor to evacuate the wounded.
The main rebel group, the Donetsk People’s Republic, has said it will not observe the agreement in Debaltseve, saying that it was encircled before the cease-fire began and that it is therefore now an internal region in its enclave, not a section of the front.
The only resupply road into Debaltseve is mined, in range of rebel artillery and at times held by pro-Russian infantry. On Friday, eight Ukrainian soldiers reportedly escaped on foot through the fields, and on Sunday, a dozen or so made it out in a truck [one of the soldiers on the truck said it was dumb luck that they made it out alive]. 
On Tuesday, however, Ukrainian rocket-launching trucks and tanks were barreling down the resupply road toward the fighting, though the cease-fire required both sides to withdraw heavy weaponry starting at midnight Monday.
The Saker explains in a post yesterday, "Yet another monumental failure for the junta," that worse is yet to come for Kiev:
All my sources confirm that Debaltsevo is mostly in Novorussian hands and that the junta forces are in full retreat to the south of the pocket. All the top Novorussian brass was on hand today, including Kononov, Motorola, Givi, Mozgovoi and Zakharchenko as were many tens of Ukrainian prisoners. It appears that the junta forces were unable to provide the kind of resistance they showed in Peski, and that make sense because in Peski they were not surrounded and they had the fire support of Ukrainian forces just north and west of them. This time the cauldron is too deep and the "lid" too strong.
You can see that the cauldron "lid" has now closed on Debaltsevo from the north and that the junta forces are either surrendering of fleeing south where there is quite literally nothing for them to do then to wait until they run out of food and ammo. Bottom line: it's over for the Ukie forces in the Debaltsevo cauldron.
Amazingly, the freaks in Kiev as still insisting that there is no cauldron but only a "bridgehead". The good news is that apparently nobody buys that nonsense any more and the mothers and wifes of the men caught in the cauldron are trying everything they can to force the Ukie high command to accept the Novorussian offer of an evacuation corridor. The try to protest in front of the General Staff building in Kiev, then the blocked traffic. In a particularly poignant moment one of these women put a megaphone next to a cellphone to amplify the voice of her son/husband calling from the cauldron and announcing that they had for about 3 hours of supplies left.
All this is truly catastrophic news for the junta in Kiev. First, their policy of denying the issue made it impossible for their forces to get out while it was still possible. According to Russian military experts, about half of all the (comparatively) combat capable units of the Ukrainian military have been surrounded in this cauldron and that means that 50% of the Ukrainian army is now gone. Second, while Poroshenko and the junta freaks tried as hard as they could to completely deny the very existence of the cauldron, thanks to the Internet and the Russian TV channels most folks in junta-controlled Ukraine know that they are being lied to. That, in turns, means that the regime is loosing the very little credibility it might have had with the general public. Last and not least, now there will be a lot of very ugly recriminations from all sides of the political spectrum about who is guilty for that latest disaster. I would not be surprised one bit if the Ukrainian death-squads (aka Azov battalion & Co.) decided to storm Kiev for two reasons: a) to take out their rage on the regime and b) because it is safer to storm Kiev than Donetsk. Poroshenko better watch his back now. By the way, rumor (unconfirmed!) has it that he already evacuated his family to Germany.
Novorussian intel is reporting that the junta is trying to assemble three battalion tactical groups and numerous MLRS north of the cauldron to try to rescue the surrounded forces, but this will be too little too late. The Novorussians are used to Ukie artillery and they don't fear their armor or, even less so, infantry. Besides, I bet you that now that they are inside Debaltsevo, the Novorussians will deeply dig in. When is the last time that the junta forces succeeded in an urban assault operation? Exactly.
Bottom line: yet another brilliant victory for the Novorussian forces and yet another humiliating defeat for the junta in Kiev.
Judging from the reaction to Debaltseve by various participants at Minsk last week, The Saker is on the money: This is another titanic blunder by the junta which bodes ill not just for Kiev but for the West and Russia as well.

First, Herszenhorn reports Putin's reaction as follows:
[Poroshenko's] comments [asserting bizarrely that Ukrainian troops had accomplished their mission in Debaltseve], however, came after the separatists boasted of controlling the town, and after President Vladimir V. Putin of Russia suggested on Tuesday in Hungary that Ukraine should accept its defeat at Debaltseve by separatist forces he described as “underdogs.”

“Life is life; it just goes on,” Mr. Putin said. “No need to dwell on it.”
Germany's reaction is troubling: more sanctions, more blame for Russia. According to Herszenhorn:
Ms. Merkel’s office condemned the separatist offensive, calling it a clear violation of a cease-fire. 
At a regular government news conference, Steffen Seibert, Chancellor Merkel’s spokesman, said Europe was prepared to support a new round of sanctions against Russia if the situation in Ukraine continued to deteriorate. 
“There has been a massive violation of the cease-fire which took effect on Sunday,” Mr. Seibert said, according to Reuters. He said it was too early to say whether the Minsk peace deal had collapsed. 
“The hopes linked to the Minsk agreement have been seriously damaged,” he said. “We must push for the implementation of the package of measures.” 
“We see the U.N. resolution as an impulse in this direction, and in the coming days, we will work with the possibilities that we have,” he said.
To blame the NAF solely for a violation of the Minsk 2.0 ceasefire is not credible. Even the extremely biased Gray Lady reports that the Ukrainian Army violated the ceasefire. All indications are that the West is going to continue to back the junta. Hopefully, The Saker is right and Kiev will collapse from within either due to a new Maidan uprising or another Right Sector putsch. Because of the lifeline the West keeps extending to Poroshenko, change will have to come from within, and that appears to me to be a longshot.

Germany's insane behavior -- doing the same thing (sanctions) and expecting a different result (surrender of the NAF) -- does not bode well for the outcome of loan negotiations between Greece and the troika. Germany's institutional obtuseness has to be factored in.

On the other hand, one might argue that what determines German behavior is what Washington wants. Germany did not want a civil war in Ukraine, but Merkel has gone along with the disastrous U.S.-backed ATO in the Donbass. Washington supports some flexibility for Greece (see today's NYT unsigned editorial, "Give Greece Room to Maneuver"); Obama has voiced support, albeit meekly, for the Syriza-led government being allowed to implement some of its pro-growth policies. The idea here, as expressed in an "Upshot" today by Neil Irwin, "A Possible Day of Reckoning, Again, for Greece and Europe," is that eventually Germany will capitulate in favor of European unity:
If Greece ends up dropping out of the euro currency zone entirely, with unpredictable ripple effects across the Continent and the world financial system, the events of the last few days will look like a turning point that led to that moment. As of Tuesday, to be clear, markets were predicting nothing of the sort. European stock markets were down only slightly, and the value of the euro was actually up a bit. In effect, markets have seen this show before: the sturm und drang of threats and counterthreats that end in a last-minute deal.
The hedge fund manager Mark Dow offered on Twitter a way to think about the tense negotiations: “EZ bears underestimate the short-term resolve of EZ policy makers. EZ bulls overestimate the long-term viability of the exchange rate system.” 
Here’s what Mr. Dow is saying. We have seen again and again that this generation of European leaders, who built their careers on the altar of European unity, will eventually do what it takes to prevent the common currency from ripping apart. If this recent history is a guide, then the drama of the last few days is merely the theatrics required to get these finance ministers to arrive at a deal. 
On the other hand, Mr. Dow also points out, Europe really does have a big and plausibly unsolvable macroeconomic problem.
One more way to look at it is if Germany goes against her interests in Ukraine by supporting the Washington war drive then she earns the right to lead in negotiations with Greece. This means that the Moscovici document that Varoufakis was willing to sign but that was withdrawn at that last moment by Jeroen Dijsselbloem at Germany's behest will not be recycled. There are reports in the media that this is what is in the works.

Right now, given Germany's reaction to the fall of Debaltseve, it looks like continued impasse between the troika and Greece.