Europe is facing a new treaty on economic governance and a common fiscal policy. It is a treaty that is in reality an authoritarian way of dealing with the debt crisis, which has been imposed in order to support the interests of European elites. Putting the Fiscal Treaty into practice will mean an intensification of neoliberal policies and austerity for ever more. In Greece this won’t have so much impact, as the treaty follows the same economic model that has been applied here for the last two years. Greece has turned into a test lab for the rest of Europe in terms of challenging labour rights, social and women’s rights, for challenging the rights of people and particularly the exploited.
The economic crisis has shaken the world. It has driven the politicians from the ruling classes to bail out the banks and the speculators, which led the developed world into a serious so-called debt crisis. Greece’s economy stands at the epicentre of this within the eurozone and is already applying stringent austerity measures which will have serious long-term consequences for society and which will reduce the government’s capacity to pay back its spiralling debts, making the debt completely unaffordable.
Greek capitalism is also experiencing the largest crisis in its history. The Greek elite and the political parties which support it cannot control the contradictions and the crisis of the system. In less than two years, the crisis and the way it was dealt with has caused such a level of economic and social disaster that, despite European and international financial support, a selective default has not been avoided. The most optimistic (although completely unrealistic) prognosis is that provided everything goes well, the debt will be 120% of the GDP in 2020 – equal to what it was in May 2010 when Greece received the first ECB-IMF-EU loan. This loan was conditional upon a harsh austerity programme and profound structural reforms of the Greek economy (known as the Memorandum), which involved lowering wages and undermining labour and social rights. All this indicates that the crisis of Greek capitalism is of historical proportions, that it is existential in nature and that it will last for a long time.
The implementation of harsh austerity measures on the one hand, combined with the savage attack against the working class and against labour and social rights on the other have created great injustices. The official level of unemployment is at a record high of 21%. It’s higher for women (24.5%) and far higher for young people (48%). Pressured by its EU “partners” the Greek government has cut the minimum wage by 22% to around €490 (net) per month, while for those under 25, it will be cut by 32%, to around €440 (net) per month – this in a country with price levels comparable to those in the rest of the eurozone.
Further public sector redundancies are planned, and collective agreements have simply been eliminated. Over the past two years, wages and pensions have suffered dramatic cuts, taxes have been increased, public spending has been reduced, and drastic cuts will also be made to the public health and education budgets. The cuts of the last two years have more than halved average incomes, while Greek banks are being given millions to stay afloat and big corporations are paying less and less taxes. On top of all that, a privatization programme for the nation’s assets has been announced, which is to bring in 50 billion euros. This year alone, the government wants to sell off parts of its holdings in telecommunications (OTE), the Public Electric Power Company, the gas provider, the railways, the postal and water services, the ports of Piraeus and Thessaloniki, the state lottery (OPAP) and land as well.
This social injustice has spurred new modes of resistance. The experience of Greece as the weakest link in the eurozone and its contribution regarding the resistance movement is very important.
Initially, resistance took a traditional form; dozens of general strikes were called by the leadership of the big bureaucratic trade unions. The main highlight was a mass demonstration on 5 May 2010, the largest for years, sparked by plans to cut public spending and raise taxes. Unfortunately, these general strikes provided little more than an outlet for people’s rage and indignation, as they lacked both political leadership and a political plan to overthrow the government.
We entered a new phase of the movement from May 2011 when it became clear that the traditional modes of struggle were not enough and would no longer work because the social consensus had been systematically destroyed. The movement of the Greek indignados was born. It was a new reaction and an expression of the anger and the indignation of people which signified a turning point from the economic struggle to the political one as well. The indignados’ movement was directly related to the country’s deepening economic crisis and the harsh austerity measures and it swept through Greece for almost three months. Without the umbrella of any political party, or trade union, the movement managed to attract far more numbers than could have been expected, united under three main demands: (1) refusing the debt which the people had not run up; (2) overthrowing the government which accepted the conditions of the ECB-IMF-EU loans in the so-called “Memorandum” (harsh austerity, lowering wages and other ‘reforms’); and (3) real democracy right now. This period was also marked by two very important dates: the general strike of 15 June and the 48-hour general strike of 28 – 29 June.
From autumn 2011 until the fall of the Papandreou government, the movement went through a new transformation. The political strikes continued, combined with massive civil disobedience, challenging the power of the state as represented by the police, who tried to stop the protest. During the biggest demonstration against the Memorandum, on 19 October, there was a clear political demand: it was a strike against the government with a clear call for it to be overthrown. Ten days later, on 28 October spontaneous, country-wide, popular demonstrations during the military parades brought the political struggle against the regime to a head, ending the legitimacy of Papandreou’s government and leading to its collapse.
The rebellion took different forms. Around the country people threw yoghurt at the government’s MPs in a sign of protest, demonstrating their indignation and anger. In Athens, the power of the people was shown in the way in which large numbers of citizens endured the clashes with the police and reoccupied Syntagma Square again and again over a 48 hours period in June. And the huge demonstration on 19 October, and the protests at the parades on 28 October, again showed that Greek society was ready to rise up and reject the government and its plans. Although the Greek indignados movement didn’t succeed in overthrowing the government and the medium-term fiscal plan, it nevertheless had a profound impact on the political situation and left a legacy for the next stage of the protest movement.
As the crisis deepened and the austerity measures condemned Greek society to deplorable living conditions, large numbers of working people started refusing to pay a debt that they had not run up. Under the slogan “we don’t pay”, this movement has refused to pay motorway tolls, bus fares, electricity bills that include a new property tax and bank debts.
Even more elaborate and more radical forms of struggle appeared, with workers taking on self-management. The striking workers at Eleftherotypia, one of the most prestigious Greek daily newspapers (privately owned) that is currently going through a bankruptcy procedure are one example. At the end of December 2011 the workers at the newspaper, who hadn’t been paid for several months, went on strike. At a general meeting they decided to publish their own newspaper with a democratically-elected editorial committee. So far they have published two issues.Striking workers at the ALTER TV channel have decided to manage the TV channel themselves, transmitting petition messages against the media owner, but which show support and solidarity to other workers that are on strike as well.
The strike at the Hellenic Steel factory in Athens, which started on 31 October 2011, is now entering its sixth month. It erupted when a quarter of the factory’s 400 steel workers were sacked and the rest were told they had to accept reduced hours for lower wages. The strikers have called for the reinstatement of the sacked workers and a return to normal hours and pay, arguing that the company is profitable and that the management is taking advantage of the austerity policies to increase company profits at the workers’ expense. The struggle of these steelworkers is exemplary of the struggle of all Greek society fighting for dignity against unemployment, poverty and exploitation.
A new reaction and expression of the latest stage of the resistance appeared with the popular assemblies in the squares and neighborhoods of Athens and other Greek cities. Using a broader political framework in order to include and secure the participation of larger sections of society who want to fight against the implementation of the austerity policies and reforms imposed by the ECB-IMF-EU ‘troika’ since May 2010, against the troika and for the overthrow of the government, these popular assemblies extend self-organization into people’s lives by creating solidarity networks, by occupying public buildings, by creating community grocery stores, social clinics, byexchanging services and products without using money, and more.
But behind the spectacle of the burning and the fires, there was a deeper process going on in society, a patient construction of a different way of doing things, the creation of social cohesion and mutual support. This process could eventually lead us to an alternative path, it could lead to us creating institutions of democratic counter-power in every neighbourhood. That Sunday was in fact the point at which the Greek people lost their fear. The economic elite, the political parties and the mass media which supports them, are aware of this now and as a result try to criminalize these social struggles.
Moreover, the new Memorandum doesn’t only support the profits of the banks and the speculators, but is an important gift for the economic elite. The huge cuts to the minimum wage in the private sector have led to a redistribution of income on a historical scale which makes the craziest dreams of the Greek capitalists come true. The management of the debt crisis and the creditor-led selective default are the absolute weapons of capital in overcoming the crisis of capitalism and they entail smashing wages, pensions and the welfare state. Even the creditor-led selective default within the eurozone will not last for long, because the single currency will lose its credibility because, following the involvement of the private sector and the exchange of Greek bonds (PSI), the debt has become transnational. The next step will be a selective default outside of the eurozone.
The new Memorandum and the new treaty underline in the most obvious way the dividing line between the two sides: on one side there is capital, the Greek elite, the Greek bankers and industrialists who made profits and speculated over public spending, those who sent their money to Swiss banks, those who presented their own interests as the troika’s demands; and on the other side there are the working people, Greek workers and migrants, and the poor layers of society who are paying for a crisis they didn’t cause and whose rights and gains are destroyed.
The administration of the Greek crisis is obviously being run by an international system that fully respects and supports the interests of the Greek elite and of international capital. Therefore, the ceding of national sovereignty is a conscious method of imposing class interests against the “internal enemy”, the working class, and because of the international importance of the crisis, they need to be confronted internationally. That is why this concession not only has to do with Greece but also with Portugal, Ireland, Spain, Italy, etc. The new European Fiscal Pact is another version of the abandonment of sovereignty rights for all European countries.
The wave of solidarity with the Greek resistance movement that is sweeping the world, with demonstrations under the banner “we are all Greeks now”, creates hope and moreover reflects a realization that the austerity policies imposed by the EU leadership, the ECB and the IMF in order to save the banks and make the rich richer will be imposed on other EU member states. For this reason, cross-border coordination is crucial for the austerity policies to be stopped in Greece, before they spread and burn the whole of Europe. If the neoliberal model prevails in Greece, the markets will move remorselessly to the next weakest link.
We need to understand that solidarity is a weapon in our hands that can help us get rid of a failed system. Campaigning against the bailout package for Greece could be a very practical act of solidarity from other countries as that money doesn’t go to serve social needs, but rather to save the banks and service the debt. A citizen-led default, even if it brings rupture with the EU and the eurozone, followed by public control of the economy, socialization of the banks under worker-control and redistribution of wealth through the taxation of the rich is for Greece the only alternative path towards a democratic society with social justice and equality. It would need a government of the Left to implement such a programme, ripping up the memoranda and the austerity policies and thus opening the way forward for people to take control of their lives.