The recent events in Greece are just a foretaste and a threat of what can happen in the entire EU as a consequence of the international economic crisis that began in 2007. Even though initially the epicentre of the crisis was in the USA, there is no doubt that the most affected imperialist pole is now the EU, for the crisis exposes all the sore spots of their contradictions.
Objectives of its creation
The EU was born in the 1990s out of different international treaties. Currently it consists of 27 countries as a continuation and a deeper version of the European Economic Community (EEC), founded in 1957. In the year 2000 the Eurozone was created: 17 countries that adopted the euro as common currency controlled by the European Central Bank (ECB).
Far from being “an egalitarian union of countries” meant to allow for “progress and welfare of the peoples”, EU was born with two very clear targets. The first one was to defend an imperialist space of their own against USA. Akin to this first target, the second one was to join forces of these imperialist bourgeoisies in order to attack and try to eliminate the social achievements of what was called the Welfare State”, attained by European workers after II World War, when capitalist were force to make important concessions or else run the risk of losing everything to the socialist revolution that was approaching from the East.
A union of the uneven
Inside the Eurozone, very uneven countries with different economic and productive development (E.g.: Germany and Greece), flocked together. That is why their great beneficiaries were the main powers (Germany and France) especially their great corporations and banks that could expand their business and investments without major limitations. Weaker countries, such as Portugal, Ireland, Greece and even Spain suffered a strong process of deindustrialisation, with the disappearance or reduction of the “not competitive ones” actually they had to compete against enormous state grants that German or French farmers receive and the increasing penetration and domination of their banking and financial markets.
During the last period of peak of the world economy (2002-2007), this scissors-like development was concealed by the income that the weaker countries received from tourism, commerce and transport and the development of building industry. The circuit of euro income-expenditure was accumulating contradiction but it still worked. Even the economy of the Spanish State, supported by the benefits from their investments in Latin America lived a peak of growth. But the crisis cut this – fictitious up to a great extent – circuit and the contradictions burst with no disguise.
This relation of the weaker imperialist countries with the stronger ones is nothing new in history. In his well known book on Imperialism, Lenin pointed out, for example, that Portugal was simultaneously a colonial power and a country totally depending on England. The creation of EU and the Eurozone only made this type of relation much deeper and now, with the beginning of the crisis, is pushing the limits further out.
The crisis of the public debt
The international economic crisis affected the European economy as a whole and reduced the income of euros from weaker countries. States began do get indebted, be it to help directly to help banks or else to cope with the payment of public debts that kept on thriving with each re-financing due to the increasing cost of interests. The Greek and Irish bonds are already regarded as “junk”, the lowest rank down the scale.
This is how situations of “default” were reached; this means that a state cannot afford to pay it debts. That is where the need for “packet aid” on behalf of the EU and IMF to pay these “red balances” and prevent bankruptcy. In exchange there will come harsh and constant demands for cuts in wages and pensions, for higher taxes attacks on public health and education, orders for privatization, etc. In response to that, struggle of the peoples against such measures and further heightening the instability for the bourgeoisie.
The second crisis of the euro
The Greek crisis and its evolution is not a problem that affects that country alone. It is not even a crisis affecting only the PIGs. Analysing Greek crisis, the British weekly The Economist defines a “second wave of the euro crisis” as from 2008, because that country is the most visible part of a continental crisis. It is in Greece and in the way how the situation in that country is solved, that the future of a construction (the Euro system) that took the European imperialist bourgeoisie 50 years to build.
It is all about a “European crisis” for three reasons. The first one is the rigidity of the monetary system as a whole. The existence of a sole currency and a sole international authority makes the Eurozone member countries cannot have a capitalist monetary policy of their own, as could be, for example, a strong devaluation of their national currency, without breaking off from the euro. At the same time, all the “anti-crisis” measures of this European authority represent actual “intervention” and “imposition” over the affected counties. At the same time, the crisis of member countries, no matter how small, actually become a crisis of the Euro as a whole.
Secondly, today Greek banks are controlled essentially by foreign capitals, mainly German, with French and American coming in the second place. In other words, a bankruptcy of the Greek state and financial system (like in Argentina in 2001), would have extremely serious consequences for the entire European and world financial system.
Thirdly, even if the imperialist chain threatens to break at the thinnest part (the PIGs), the fiscal and economic crisis has also penetrated very deeply into bigger countries, such as Spain (considering the “size” limit that the EU could “help”) and Italy, that has recently suffered a speculative attack to which the Berlusconi administration responded – with full agreement of the opposition from the opposition in the parliament, voting unflinchingly a very tough adjustment. Even much stronger powers, such as Great Britain and France have been driven to put austerity plans into practice. If the EU chain snapped at the Greek link, the domino effect towards the other “links” could be very fast. And, according to what a former Nobel Prize in Economy, the American Paul Krugman, the fall of the euro could be “a catastrophe” for world economy and finances.
The euro pact
But European bourgeoisies, especially German and French, are prepared to defend the euro to the bitter end and their own imperialist space for their own benefit.´
On the 27th of June, in Brussels (EU headquarters) the so-called “The Euro Pact” was ratified; it is text signed by the 17 heads of the Eurozone in order to “respond to the crisis and increase competitiveness of Europe”.
In order to do so they will have to advance a lot in two aspects. On the one hand, the submission of the weaker countries and in return for “financial aid” demand measures and conditions of control similar to those of the Latin American countries in the 1980 and 1990. For example, the chairman of the Eurogroup, Jean-Claude Juncker, said explicitly that the sovereignty of Greece will be “enormously reduced” due to the plan of adjustments passed in order to release the aid from EU and IMF.
Secondly, the achievements, the living conditions and the rights of the workers will have to be attacked with increasing lack of considerations. From this point of view, Greece is the spearhead of the adjustment plans to be applied in the entire continent. Today the capitalist, imperialist system can no longer warrant the maintenance of any of these achievements (agreements on wages, labour conditions, decent retirement pensions, public health and education, etc.) and has to destroy them all in order to defend their own profit and unload the cost of the crisis onto the backs of the toiling masses.
Inter-imperialist contradictions
Banks, doubly responsible for the current situation, are those that most demand sacrifices from the weaker countries and the European toiling masses as a whole. But this is beginning to produce splits between the European imperialist bourgeoisies. While the top-notches of the EU and the ECB defend the posture of the banks, the German premier Angela Merkel defended the posture that banks should shoulder a part of the cost of the “aid” pack (when all is said and done, meant to “save them”) and so to tone down the impact on the people. Merkel certainly expresses the double pressure of the German industrial bourgeoisie, eager to avoid a new recession and provide an outlet to their exports and the German electorate that is against their state providing funds for this aid. At the same time, she fears popular reactions those “wild” packets may cause. The governments of France and Spain, who have lined up with the harshest measures of the ECB and possibly also reflect the close commitment of their main banks with the debts of the PIGs. Be that as it may, these divisions add to the general instability to the situation that is explosive as it is.
The accelerated crisis
The bourgeoisies of weaker countries (such as Greek) are willing to accept this submission in order to defend the minor part they perceive from the exploitation of the workers even if that means a clear retreat of their countries and the obligation to deliver tremendous blows on their peoples.
No European country is fit to help any other. Behind the Greek powder keg, Portugal, Ireland, Spain, Italy and England are queuing… They have already spent almost all the support ammunition by 200-2009. Even the USA is suffering their own economic and political crisis and their default is looming over the horizon… something unthinkable in the past.
But if the bourgeoisies accept submission, the toiling masses do not seem to be very willing to do so. In the Greek case, resistance has been rampant for the past two years and is developing heroic features: over a dozen general strikes that are now joined by occupation of squares in the Egyptian or Spanish style.
But if the Greek toiling masses are the vanguard, it is obvious that resistance is spreading all over the continent. There we have the struggle of the French workers and youth against Sarkozy last year; the demonstration of the “generacao a rascal” in Portugal; the Spanish outraged; the powerful general strike of civil servants and teachers in England…
This struggle produces wearing away and crisis in the right or “left” governments that apply the plans. And as the struggle continues, it is the regimes themselves that begin to show signs of crisis for the political mediations intended to brake or to digress the struggles. In Greece the social-democratic administration of PASOK is loosing strength very fast while the right (New Democracy) has not yet recovered from their electoral defeat in 2009. The representatives of both parties had to be protected by several police cordons to be able to enter the Parliament and jointly vote the measures of the latest packet. This wearing off of the regimes also became evident when young people of Portugal and Spain chanted for “real democracy” and exposed the close links of these political regimes and their parties with their imperialist parties.
Things are not even: the situation in Greece is not the same as in Germany, where the most powerful proletariat in Europe has not yet taken the centre of the stage. In spite of the fact that there have been great demonstrations against the nuclear plants and the Merkel administration is also suffering the consequences of the European crisis and a fall of Merkel’s political prestige.
To put it all in different words, European bourgeoisies must apply the worst adjustment plans and carry out the worst attacks in decades against their toiling masses and with no tranquility in the background but strong resistance and increasing political crisis that mires them even if they do manage to get these measures trough in the parliaments further boosting the economic crisis at international and continental scope.
What way out?
In spite of increasing resistance against the adjustment plans, especially in Greece, European workers and young people cannot envisage a way out of the crisis. This is so because trade union and political leaders, even if they often have to summon for general strikes and demonstrations, prevent the carrying out of real plans of struggle that would not only challenge the plans of adjustment but also defeat the governments that put them into practice and so open the possibility of imposing workers’ and popular administrations that would put into practice plans that are useful for the people and not for the bankers and monopolies. At the same time, even if the struggle goes against the same enemy, the EU and its policies, these leaderships divide the struggles in one country against those in another one and so they weaken the results.
This policy of the major leaders of workers has a common background: the defense of the EU and the Eurozone. A position that is shared by other trend further left, such as Bloco de Esquerda (BE) of Portugal according to whom it is all about creating – inside the EU – “an alternative for policies of creating jobs and democratic decisions against financial speculation” and to work out a “viable programme of struggles” for a “new architecture of the EU”. In other words: it is all about reforming the EU in order to make it “more human”. All these trends provide the chorus for their imperialist bourgeoisies because they tell – overtly or implicitly – the workers that even if the plans of adjustment may be bitter pills, it would be much worse to get out of EU and the euro.
The capitalist crisis has forced the EU to show its real face as a construction in the service of imperialism (German, and next to it French) to benefit their banks and multinationals, submitting such countries as Greece, Portugal, Ireland or Spain) and attacking fiercely the workers of the continent. There is no more room for the disguise demagogically as “European Social Model” or for democratic games guessing who takes all the decisions and where they are taken. There is absolutely no way if “reforming” the EU so as to make it more human just as there is no way of dosing so with capitalism as a whole.
That is why there is salvation for Greece, Portugal and Ireland provided they acknowledge the non-payment of their public debt, split away from the EU and adapt drastic measures such as expropriation of the banks, nationalisation of strategic companies under workers’, mobile scale of working hours so that there can be jobs for everybody and the establishment of monopoly of foreign trade. This is a programme which, sooner rather than later, will be posed for other counties, such as Spain and Italy.
We, the IWL are fully aware of the fact that the problems of Greece, Portugal and Ireland cannot be solved in isolation. That is what we propose is not a return to the old, capitalist, “national” isolation or to their old currencies, as several right trends on that continent propose.
Against the Europe of the Capital, represented by the EU and the Eurozone, our proposal poses the struggle of all the workers on the continent so as to reach our own unit of a proletarian and popular solution, with the prospect of the construction of the Socialist United States of Europe.
This is an immense task but absolutely necessary and it must be urgently done together and in live process of the struggles, with the emerging of new political and trade union leaderships, based on class independence of workers’ movement and their independence from all kinds of bourgeoisies and their governments.
