report it's next right here on our to. welcome to the kaiser report ties are you know there are more ways to skin a cat than choking with butter and there are more ways to kill a dog then hang it but let's face it some ways are a lot better than others. max the cat we're going to skim in this episode is the debt cat and that is iceland gets tough with foreign creditors the failed banks iceland is the nordic free market democracy with glacier covered volcanoes and hyperactive geysers if you're into mind bendingly complex own lyrics there's bjork and sigur ros and the rarefied world of global finance iceland is also where local palms and central bankers trample on the interests of bond holders like

a herd of marauding reindeer at least that's the perspective of foreign bondholders and distressed asset hedge funds hoping to recoup their investment of three icelandic lenders led just banking geitner bank and coutts and banks that defaulted on eighty five billion dollars of debt in two thousand and eight so they have elections in april twenty seventh of the re-elected these parties independence party and progressive party and their platform they both ran on an anti austerity platform of lower taxes and home mortgage relief to be funded in part by forcing overseas creditors to accept losses on the three point eight billion dollars in krona denominated assets are owed by three failed lenders also in place eight billion dollars in deposits in loans owed to overseas creditors that have been trapped in iceland thanks to capital controls imposed in two thousand and eight so their unemployment rate has declined to five point eight percent from nine point three percent part of the way they've done a as well is that their krone as the article points out they've paid for it with

a forty percent decline in the krona but if you compare that to here sterling has declined by forty percent against the chinese yuan in the last since two thousand and seven. countries like greece can only look enviously at iceland who was able to devalue and take out the banks so that's a two way to put prong approach to recover from the excesses of banking catastrophe devalued so at the banks there's iceland paved shows away. greece unfortunately is locked into the euro and they're just they've been taken over they've become a vassal state from the i.m.f. and the m.f. and the troika and these global institutions so they unfortunately lost their sovereignty and that now this article in business week warns that oh iceland what maybe shut out from the global bond market nobody will buy their debt if they fail to pay back this three point eight billion they owe these foreign unsecured creditors well the fact is junk bonds are trading at less than five percent right

now people with medieval of the wherever it is best to just propaganda that's put forward by the entrenched kleptocracy that a country like iceland just because they got their house in order is somehow going to be shut out from the global wholesale market or bond market that's never been true wasn't true for argentina it wasn't true for any country that had to go through bankruptcy they come out with it and people will buy their bonds because if you've got a yield on a piece of paper people will buy as you point out they're paying so high up for junk bonds the yield are now down to five percent which is where treasuries were less than five or six years ago so people will pay up for yield it doesn't matter where it's coming from in iceland is an actual in credit now you mentioned to greece and we're going to look at their debt situation where they're being forced to pay secured an unsecured creditors no matter what at all costs including over sixty percent youth unemployment well here's the headline and i'm going to try to

read it it's in dutch. greek can lie on direct mech to work camp vor select bella's balor as well basically max the according to google translate that reads greece threatens labor camps for poor taxpayers so if you owe back taxes and you don't have any money to pay it well the government is looking for an army camp in the attic or region to people who have debts to the tax authorities serving their sentence confirms the deputy minister for justice and the greek parliament now he's saying this is a more humane solution because they're building these unique death camps debt camps . at a former army base but there won't be any rapists and murderers and other sorts in there so it'll just be these bad debtors but i seriously are going up this is compare and contrast here's a country like iceland maintain its sovereignty number one and then recapitalized and their smooth sailing toward growth period with their currency intact unemployment is looking good where is greece because as part of the i.m.f.

the troika the international global banking terrorism network they are now being asked to be shipped off to death camps or as you kind of made a boo boo by saying death camps of course you'd have to go back sixty years in european history to find a similar incident where one country decides to scapegoat individuals and send them to death camps here in greece the victims are being victimized and scapegoated and shipped off to debt camps i mean how long before there's i plan b. i can only imagine that that will be forthcoming now i think they're still planning on possibly building these and perhaps make the unsecured creditors happy goldman sachs happy we know they already operate these debt camps basically in america they're sending poor people to prison for debts they owe but now let's look at staying in europe what spain has done with their collapse this is the option they

took rather than the icelandic solution they chose the spanish solution also at the behest of the troika new bank shares tumble wiping out family savings in spain nationalized giant has now lost ninety nine percent of its stock exchange value since it was listed twenty two months ago so when bank key of the biggest bank in spain collapse of course they government handed out these new shares a new bank and eleven billion of those shares were first able to trade just this past. tuesday and what happened of course they tumbled billions of euros of savings were wiped out from families across spain you know this reminds me of something george osborne came up with recently where people are going to exchange rights workers' rights for shares and companies and the shares of those companies will like bank you shares collapse by ninety percent in value this is a george osborne look alikes game but i understand you're saying as

a third option people had to deal with the crisis the icelandic version of the greece first and there's a spanish version where they wrapped up all these debts into a public offering they suck people into the public offering using the propaganda of financial media and then offering collapse by a huge amount just wiping out or transference of wealth from the many to a few of the financial gestapo well also i mean basically these were preferred shareholders a lot of them prior to the collapse and the banking system there had pushed them in as the banking system was collapsing the population itself did not understand that the banking system was about to collapse they were being pushed into these preferred shares the story for example highlights one family who sold their family business shortly before the collapse they six hundred thousand euros in savings now they have a few bucks. if in fact they're treated it with a dollar is the preferred shares are like getting preferred seating on the titanic

in this case and yes you much preferred seating here wonderful view of the iceberg yet there's flying in the bottom of the atlantic right now well then we could move on to what has happened in the u.k. now the preferred option here was sure they did bail out some of the banks but they're inflationary because of course europe as we've just covered greece and spain they cannot do the inflationary option because the boom just bank which runs the e.c.b. the germans do not want inflation so household income. lowest for three years hard pressed families left with one hundred fifty five pounds a week after bills and taxes household spending power slashed by five hundred forty four pounds each week in food utility transport bills and taxes despite an improving economy rising living costs are outstripping salaries so wages only rose by point eight percent versus that which is only

a third of what inflation as official inflation is here inflation is a cowardly way to strip people of their wealth simply you would expect us from what george osborne he doesn't have the strength to do the deutsche bank i.m.f. german way of outright death i mean death camps and extermination no no he's going in the hyperinflation way by simply starving people to death by allowing prices to skyrocket and in this country of course you see it in subtle forms like horsemeat mills on reduced portions for things that the store has so really the adjusted rate of actual real inflation in the u.k. is not running at two point eight percent like the government says it's running at over nine and a half percent real inflation in real terms now again of course also tied in with this is that there's no new plan being introduced iceland is radically real altering their economy away from banking and banks are schemes here the article

points out that chancellor george osborne will find little comfort in the findings as they suggest families may not be able to spend the economy out of trouble or have enough free cash to absorb any increase in interest rates this. is doubling down on fraud goes into the end of the derivatives casino and he sees a big roulette will and instead of red there's fraud and a sort of black there's double fraud and there's a little green called triple frog and he spins the will you own little double fraud that's my policy for the next three years so. and then finally we have this you know european summit earlier this week about a new deal for the youth unemployment which is shocking across europe some of the numbers in spain half of the under twenty five star jobless forty percent in portugal greece has sixty four percent they also say that you know italy and france have over twenty five percent now the you it compared to the u.s.

which has official rate of seventeen percent but the u.s. has one of the highest if not the highest in the world of non employment because of course america doesn't count the unemployed but if you look at the number of those employed you'll find out that the situation in america is just as bad as europe but germany sees revolution if welfare model scrapped germany's finance minister wolfgang schauble warned on to say that failure to win the battle against us unemployment could tear europe apart while abandoning the continent's welfare model in favor of tougher u.s. standards would cause a revolution we would have revolution not tomorrow but on the very same day there's going to be a revolution anyway i just feel me and question is timing there's looks like this summer in france so it's going to be a bloody and sort of action there's going to be a similar kind of insurrection elsewhere in the world probably not in the u.k. because they'd have to be sober first. all that's not going to happen as our i say

as ever thanks so much for being our guys are in for it thank you max so true for the second half we'll be speaking with george galloway. he did this in the summers with. her. clear image of iraq after inflation. twenty day taxi trip through the country. the road full of. clear evidence

from north to south. the roots of iraqi tragedy. after the war waiting for peace. taxi on our t.v. . news today violence is once again flared up. these are the images cobol has been seeing from the streets of canada. china operations rule the day. welcome back to the kaiser report imax geyser time at a target george galloway

a member of parliament here in the u.k. george galloway welcome to the classroom part all right george galloway i got to get to this right away you're against scottish independence tell us the economic and monetary reasons for your position for first of all it wouldn't really be independence we'd still be in the european union and we'd still have an unelected monarch as our head of state and of course the question of which currency we would use is a moot one. bank of england the treasury would surely not allow an independent country to operate the punt because that would be giving the scottish government power without responsibility and the westminster or thought it is in the city it would have no authority over what the scottish government the newly independent squatter state was doing with the currency doing with rates of tax doing with interest rates and so on so that's an impossibility so the possibility

a marriage is of joining the euro well how's that going who in scotland will be persuaded to go quietly into that good night there have been occasions when the scottish independence movement has floated the idea of scotland does iceland and as i don't know the republic of ireland before it sank and of course the republic of ireland is in the euro but the icelanders are not and we know the ash that enveloped the currency and indeed the economy in the whole society so the question of which money the independence quarter state would use is a moot one. but of course the more serious problems are that an independent scotland would trigger a race to the bottom for. working people why because without seventy one anti conservative m.p.'s coming from scotland which is precisely the number seventy

one on to conservatives one conservative there would be perpetually a right wing conservative government in england and in england the government would ensure surely the rates of corporate taxation personal taxation public expenditure levels etc were so low that the scottish government would have no alternative even if they were enthusiastic about doing so which they are of following them to the bottom which point what price the so-called progressive even socialist independent scotland that's projected by supporters of the s.n.p. what price that you would have to. free market friedman night monetarist governments chasing each other to the bottom and i think the time would come quite soon that the scottish people would rue the day that they had broken up this country in my last point is less powerful now than it once was but it remains

i think a fact that in these storm tossed times to get out of an ocean liner and get into a rowing boat which is why our country of five million with the only population in western europe that's actually falling which has four thousand miles of coastline oil and gas fast running out and huge tracts of the country empty. that would be a very perilous choice for the scottish people to make i mean understand a pragmatic approach but how do you does your heart kind of map which are had a saying or is there any kind of oh my heart really does i'm against breaking up countries i've been against the breakup of virtually every country i think the partition of india and then it's report fission was a mistake i think the breakup of the former u.s.s.r. the breakup of the former yugoslavia have all been the arctic. slovakia no into two states has all been a big mistake in this world that we have were huge powerful economic forces at work

that democratic states have to come together no splinter asunder and of course it all goes wrong what happens is a rise in ethnic sectarian tensions national tensions because if it didn't work out the way the scots hoped that it would would be to blame who should be blamed for the fact that the elysium fields promised by the independence movement have not been idle that interregnum countries are against the kind of idea bring up countries that without this kind of recourse for countries to to revolt as it were there is a consolidation of power always and at the top of the hierarchy and we a spouse democratic principles but they're feeling far between and power tends to corrupt but i want to ask you about a comment you make regarding independence that socialism won't workers in positions kalidas would be socialist and that socialism doesn't work through some of them in

one country didn't work even when the country concerned stretched from the utils to vladivostok the u.s.s.r. failed as a socialist country with all those people those resources scotland as few resources hardly any people and would be attached four of our organically to a permanently tory england so the idea of an independent scotland could emerge as a kind of cold water cuba which is how it's sold by some on the left in scotland is frankly absorbed and when it became clear that it was absorbed as i say this would be on for the scapegoats but let me address if i made the point you just made because you're right i'm not suggesting that instead of breaking up countries we have a kind of so. e.u. run on the current lines there are many many serious problems fundamental problems about the model but the answer to that is to democratize the model not to atomize

us all into independent states every state will have an army and navy and air force the chain of embassies around the world will have bureaucracies will have a flag and a border and the temptations with borders is that you stand out the shouting blue johnny foreigner that's what's wrong with the farache ukip perspective for the u.k. and it's what's wrong with the alex um and s. and p. perspective for so let's talk about this idea of socialism for a second because if again if i'm understanding correctly you're saying you're suggesting or what i'm hearing is that in scotland case it wouldn't necessarily work but you're not saying us that sort of blanket condemnation of socialism as such because of course there's the way that people view the world typically as they and they break it into two opposing ideologies socialism and capitalism i don't think you could i could safely put you in the camp of a capitalist know so under the very crude definitions that we are forced to live

with unfortunately in this day and age there's usually that split socialism capitalism if you're not capitalism you're kind of socialism they saying that it would definitely work for scotland you're just saying it just in scholars case because you're not saying socialism as such is a word because i mean or venezuela or hugo chavez big supporter there that's a socialist model so you've got some had how do you find to it yeah i mean socialism as a concept is not a busted flush but it can only work where you have a critical mass of population resources and the ability to actually act independently scotland has none of these three things we would not be acting independently because we'd still be tied to the english currency if the english agreed and they would only agree if we signed over any. independent tools of changing the quantum me let me jump in because. as a tactician you're saying this is not necessarily

a great idea and less roll of the fence to ear or ear an m.p. for the respect party in the house of commons and obviously the respect party wants to increase its influence and you want to bring in other m.p.'s out of the respect party when you look you measure nigel frost for a second here's a guy who was really on the outlying force ukip started on the french and they've really made their way into mainstream that as a party leader for respects as any lessons learned from that number one just as a from a tactical point of view putting aside the politics for a second as as a mere tactician nigel horizons like he's done a good job up he has tried to do the same kind of thing be honest be street be real be a human being not speak your whip machine see what you mean mean what you say for aaja is perceived in the country to be all of these things and i try to do the same of course selling right wing nationalist ideas to the simple minded is easier to us than selling leftwing progressive socialist ideas especially in the sea

of media power all around us which is deeply hostile to the kind of things we talk about let me ask a question it seems a night of popularity is not really homegrown it came from foreign media nigel fries is a star on our team because he's been on our t.v. shows and this were raised as global awareness to the point where the u.k. media couldn't ignore him any more this speaks to the fact that a huge institution like the b.b.c. very centralized autocratic institutions in the u.k. still losing its grip murdoch's out of the picture certainly in israel is global media now alternative media i know you're big on facebook and twitter how's that playing into your political ambitions i. oh yeah i mean i think you're right there comes a point at which the mainstream so-called live stream british media cannot ignore

the phenomenon as the phenomenon the rising in in the country one of them is a detestation of the british in scotland of the european union in england others are over what i call the three cheeks of the same box three rulers of the mainstream parties who have an ironclad consensus behind war privatization or still are to. the media the privilege also doctor dr johnson said the the grimmest dictatorship of the mall is the dictatorship of the prevailing orthodoxy and the prevailing also doxie would have prevailed whether or not foreigners use the foreign media the existence of twitter facebook the internet the cyber wars ideological wars that are going on they have climbed over the walls of the prevailing orthodoxy now of course on the foreign media side your parents before congress in america just a few short years ago testifying where you slammed the gentleman you are

who is and who is asking you the questions. and i wanted to ask you something as i'm watching that event and it seems to me that it was a great example of how education in the two countries are vastly different because in this country of course people grow up debating and in the house of parliament debates are key to any see question time every wednesday in the us there's no such tradition at all it was a watching mohamed ali go after a net i don't remember the guy's name you were debating in a tone norman coleman etc environment coleman but it was so one sided and it's done i mean you're brilliant order in your own right but this this is a system that produces a lot more in the house of commons a lot more debate well how would you. we have about a minute left i'm just curious either you know the system so well how would you contrast the two was a good point senator coleman made george w.

bush would say he misunderestimated me he thought i was just working class son of immigrants from scottish city how could i stand up to the princes of the senate and therein lies the point these senators regard themselves as princes and other people treat them as if they were princes no one goes into the court of the soul and speaks the truth to them i go up close personal and punch the living daylights out of them it's good you made the mama dolly analogy i'm a former boxer myself grokking masi onil was the model i purposefully set out to follow on that day i decided not to be mama dolly not to be mike tyson a punch just to be rocky marciano remorselessly punching punching punching but as a boxer i can tell you that you see in the other guy's eyes the point at which he wishes he was no longer they are boxing you can throw in the towel but in politics

in front of live t.v. come from all over the world you simply cannot and there was no escaping he could run but he couldn't hide look up on you tube it said george galloway versus norm coleman who is long gone but george galloway of course on the on the ascent thanks so much for being on the kaiser report pleasure all right i'm going to do it for this edition of the kaiser reform with me max kaiser and stacy herbert i like to thank our guests george gorgeous galloway a member of parliament for the respect party if you like to send us an e-mail please just so a kaiser report r t t v dot are you into next time x. guys are saying bye off.

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