Thursday, June 16, 2011

Greek Meltdown: People vs Banks

Forget the riots in Vancouver by angry hockey fans, things are really on the boil in Greece. After a year of austerity measures that have all but killed the economy and which have driven down living standards substantially, the government is coming back for more. Not surprisingly, people are pissed. And when Greek workers get pissed, they have a way of letting you know.

Yesterday there was a 24-hour general strike against the new round of austerity measures. Those measures will certainly pay down some of the debt - or, rather, transfer it to the working class - but at the price of so damaging the economy that it is likely tax revenues will fall in the medium term, making further debt repayment difficult. Greek workers know this and so tens of thousands of them descended upon the Greek Parliament to vent their anger and frustration, calling politicians "traitors", "thieves", and "liars" and making the obvious point (obvious to everyone but the media) that it wasn't workers who caused the debt, so why should they pay for it?

I suspect that the European ruling classes fully understand the limitations of the austerity measures they are proposing but see no other way out. They will know that opening a full frontal assault on the most militant working class in Europe risks destabilizing the EU more generally, as resentment seethes against the various forms of austerity being wheeled out from Spain to the UK. Following on from the Tahrir Square movement in Egypt - and similar movements in other countries just across the Mediterranean Sea - youth and workers in Spain have occupied central squares that are shaking up politics in their country. In Greece, protestors are reported to be setting up tents in squares there as well. In the UK there is a planned strike by half a million public sector workers against attacks on pensions on June 30.

If the Greek working class can bring down the increasingly shaky Greek government in protest against austerity, that could have a serious, European-wide knock-on effect. For a moment yesterday, it looked like the government might collapse, as the Prime Minister offered to resign in order to form a cross-party government of national unity with the Greek Tories - New Democracy. New Democracy refused for opportunistic reasons and PM Papandreou was, instead, forced to turn back to his own restive Socialist Party. He will now hold a confidence vote in his leadership in order to whip them into line for the next round of slash and burn. It is, nonetheless, a sign of weakness on the part of the government, which is why markets slid around the world overnight.

But even if the government can defeat the working class in Greece, there is still the problem that austerity is unlikely to work in the short term. Russia is still recovering from the austerity of the early 90s, and has only done so because of vast natural resources and an authoritarian government that clamped down on the oligarchs who were stripping down the economy and socking away their cash in foreign banks. The Russian government also clamped down on civil rights and restored something like called Stalinism lite, killing independent journalists, crushing movements for autonomy and independence in former Soviet republics and preventing the emergence of any real political or economic opposition. In other words (limited) economic recovery through dictatorship. Hardly an attractive model to most Europeans, used to several decades (at least) of political democracy and civil freedoms.

The only thing that can save the European economy, and the living standards of the vast majority of the population, is for the Greek working class to soundly defeat the austerity package with such militancy that it puts the fear of good into the broader European ruling classes. That will open the possibility of a different response to the crisis for millions who are told there is no alternative. And the ruling classes will be forced to take on the real bandits and scroungers - the parasitic bankers, investors, currency traders, and speculators, not to mention the under-taxed and over subsidized private corporations - in order to avoid a worse fate at the hands of their own restive populations. Don't think that's possible? Neither did Mubarak and Ben Ali. As Karl Marx once wrote: "all that is solid, melts into air..."

Global markets shaken by Greek debt crisis - Europe - Al Jazeera English
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