The Highest Stakes Game of Poker in the World

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Tyler Cowen writes that we’re way past the time when modest measures might save Italy and the eurozone:

Why should another two percent inflation a year turn the tide? The inability to implement any kind of credible rule means that the “in the moment” solution has to be all the stronger. So the “answer,” if that is the right word, is ten percent inflation a year for the eurozone — plus the firehose to Rome — to get the real value of those debts down and quickly. Maybe twelve.

I don’t feel like debating whether this would be better or worse than the status quo; I am content to suggest it probably won’t happen, not even if German and French leaders understand the gravity of the situation, which I suspect they do….It’s a common meme these days that the German leaders “don’t get it,” but I view it in reverse: they’re the ones who understand how grave a problem it is, and how truly hard to fix it would be, which is why they are not doing more. They don’t see the point in pulling out the peashooter against the elephant, and the blunderbuss is not yet available, if it ever will be.

Perhaps. Public statements from various German worthies have been contradictory enough that you can reasonably draw a lot of different conclusions about what they do and don’t understand. But Tyler may be right. One plausible interpretation of German actions is that they’re simply playing a very high-stakes game of poker. They know it’s inevitable that they’re going to go all-in at some point, but they want the periphery countries to commit as much as possible to the pot first. After all, even a blunderbuss won’t work unless there’s a pretty serious willingness to accept substantial fiscal reforms among the folks getting the bailouts.

In a way, the dynamics here are similar to TARP. The serious objection to TARP isn’t that we should have just let the banking system collapse, it’s the fact that we bailed out our banks with too few strings attached. We should have nationalized them, or broken them up, or insisted on major compensation clawbacks first. This is my guess about what’s going on in Germany. They’re going to bail out Italy and the others eventually, but they want to have plenty of strings attached. And that won’t happen until the level of panic is considerably higher than it is right now.

That’s the optimistic view, anyway.

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WHO DOESN’T LOVE A POSITIVE STORY—OR TWO?

“Great journalism really does make a difference in this world: it can even save kids.”

That’s what a civil rights lawyer wrote to Julia Lurie, the day after her major investigation into a psychiatric hospital chain that uses foster children as “cash cows” published, letting her know he was using her findings that same day in a hearing to keep a child out of one of the facilities we investigated.

That’s awesome. As is the fact that Julia, who spent a full year reporting this challenging story, promptly heard from a Senate committee that will use her work in their own investigation of Universal Health Services. There’s no doubt her revelations will continue to have a big impact in the months and years to come.

Like another story about Mother Jones’ real-world impact.

This one, a multiyear investigation, published in 2021, exposed conditions in sugar work camps in the Dominican Republic owned by Central Romana—the conglomerate behind brands like C&H and Domino, whose product ends up in our Hershey bars and other sweets. A year ago, the Biden administration banned sugar imports from Central Romana. And just recently, we learned of a previously undisclosed investigation from the Department of Homeland Security, looking into working conditions at Central Romana. How big of a deal is this?

“This could be the first time a corporation would be held criminally liable for forced labor in their own supply chains,” according to a retired special agent we talked to.

Wow.

And it is only because Mother Jones is funded primarily by donations from readers that we can mount ambitious, yearlong—or more—investigations like these two stories that are making waves.

About that: It’s unfathomably hard in the news business right now, and we came up about $28,000 short during our recent fall fundraising campaign. We simply have to make that up soon to avoid falling further behind than can be made up for, or needing to somehow trim $1 million from our budget, like happened last year.

If you can, please support the reporting you get from Mother Jones—that exists to make a difference, not a profit—with a donation of any amount today. We need more donations than normal to come in from this specific blurb to help close our funding gap before it gets any bigger.

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