WAKE UP CALL

Jun 18, 2009

What is this beat-up on swine flu all about, other than to distract the attention of “Joe Public” from much more serious matters?
I wish to draw attention to a small country in Eastern Europe called Latvia. Last year I enjoyed the privilege of living there from July to early September.

It’s a lovely country but the poor bloody Latvians just can’t take a trick.
It was this week in 1940 the Soviet Union occupied Latvia. Just over a year later it was the turn of Nazi Germany to move in; the capital city Riga was captured on July 1, 1941.
The Soviets re-took Latvia in a protracted struggle to the last day of World War Two in Europe, and stayed there until the collapse of the Soviet Union in 1991.

Latvia (along with Baltic neighbors Estonia and Lithuania) was abandoned by the free world to its fate at the hands of the two cruellest regimes ever conjured up by humanity.
When freedom finally came in 1991, all of Eastern Europe began to enjoy the fruits of democracy and free enterprise that we in the West take so much for granted.
When I arrived in Riga in July last year, Latvia had experienced a year or so of almost the fastest economic growth in Europe. Confidence was sky-high, and so was credit-fuelled debt.
I flew back to Alice Springs via Darwin in early September, just before the world’s economy started to go into a tailspin.

Latvia’s economy has fallen off a cliff and it’s still plunging, the worst in Europe.
GDP has collapsed by nearly 20 percent in the first three months of 2009; exports have plummeted by 40 percent; unemployment has soared to 16 percent and is rising; most Latvians still in work (especially public servants, like teachers and nurses) have had a series of pay cuts by at least 20 percent; and real estate value has dropped as much as 60 percent.
This is worse than an economic recession; it is a full-on, full blown depression. Latvia faces the prospect of national insolvency in a matter of weeks.

If Latvia goes under, it is expected to trigger a rash of economic meltdowns across Europe. Swedish banks are most heavily exposed to Latvian debt, and there is some exposure in Germany, too.
The situation is dire. It seems that Latvia, abandoned by the West in 1940, is inadvertently repaying the West in kind with a vengeance.
Google ‘Latvia news’ and you will find recent coverage of Latvia’s woes in Europe is almost seismic; but in Australia there is barely a ripple.

One wonders what the journalists in Australia are doing. Wake up, you drongos, the alarm is ringing! Forewarned is forearmed, and the public has a right to be properly informed.
No-one here should think a little faraway country you’ve never heard of is of no concern to us. If swine flu has made it to the Northern Territory all the way from some pig farms in rural Mexico, I can’t see how we won’t be affected by a far more ominous contagion that may spread to us from Europe. Latvia is small but so are detonators.

Europe is collectively the world’s largest economic power, let’s not forget.
We are not out of the woods yet by a long shot.

Alex Nelson
Australia

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