A serious outbreak of malaria, and a sudden and uncontrolled increase in HIV infections, due to a health system in collapse. Rural children passing out during classes due to malnutrition, and classes suspended in winter months because no adequate heating can be provided. An official rate of unemployment that is over 21 per cent (over 50 per cent for the youth). This may sound like a description from the 19th century, or a a third-world country, but this is taking place in the European Union, in the cradle of “western civilization”. This is the situation in Greece today.
These problems are not a legacy of pre- European Union times. They are the fruits of 31 years membership of the EU, and 11 years of being in the eurozone and following the economic policies of the European central bank.
WHY HAS GREEK ECONOMY SUNK?
There seems to be a common sense idea in Britain that this crisis was caused by Greek carelessness. Even in countries that were already hit hard by crisis and austerity plans, such as Portugal, people say, “this is happening because Greeks are lazy”, don’t pay taxes, or pay little when compared to other EU countries. This is promoted by the media, and repeats what was said by the technocrats in the Troika (the European Commission, Central European Bank and the IMF) and their puppet-statesmen.
For Y. T., a young Greek working in tourism, this argument makes no sense.
“Of course we are reluctant to pay our taxes. We already earn little because of recent cuts in wages” (wages went down 22 per cent in general and 32 per cent for those who are 25 or younger). “And what’s more important, we never saw this money being used in our favour. We have to pay for our own health, because the public health system was never any good… the same with public education, where we have to pay for private complementary classes in order to have a chance of getting into the university. In Athens we have a small, expensive subway system to handle more than 4 million people. I lived in Berlin for some time, and I wonder how the Germans would feel about paying their taxes if they had just three subway lines”. It is worth noting that the German capital has about the same population as Athens but nine subway lines. Taxes are on the rise for workers and small business-owners but all revenue incomes from ships and shipping (one of the few important industries left in Greece) are exempt from taxes.
The catastrophic Greek situation cannot be blamed on cultural issues. Its roots go deep into the European crisis.
WHAT ARE THE REASONS BEHIND THE GREEK CRISIS?
When Greece joined the eurozone, in 2002, in spite of a sudden rise in the cost of living, the economy grew – from 2002 to 2010, according to the World Bank, Greek GDP increased 51 per cent. But GDP is calculated through a formula that adds private consumption, capital investments (both internal and external), government spending, and the commercial balance, that is, the sum of all net exports minus the imports. Government and private spending was encouraged by easy loans provided by French, German and Swiss banks, creating an illusion of growth.
While the Greek economy seemed to expand, the commercial deficit went from $17.8 billion in 2001 to more than $39 billion in 2011, with obvious benefits for Germany and France, as they accounted for more than 25 per cent of Greek imports. Germany pays interest rates of around 1.3 per cent in a 3-years loan, while the ‘cheap’ loans now offered to Greece by the European Bank are around 5 per cent and were previously far more expensive. So with the EU and the single currency Germany and France could invest their capital with high interest rates, and this money would quickly return to them through the uneven commercial balance of Greece. This part of what allows the German economic ‘miracle’ to continue. While Greece’s GDP went down sharply in the last years the German economy still grows, and its unemployment rate is still stable.
Cheap products from the central European countries, produced with better machinery, led Greece to double its imports while specializing in ‘services’ – like tourism. This made the country dependent on the rest of the EU and its economic fluctuations to provide for the living needs of the population.
All this fragility has now surfaced. With the crisis and the risk of a default, the real masters of the European “Union” want to make sure the government can keep paying its public debt, out of which great profits have been made. Their recipe is simple: force Greece to privatise what is left of its public services and attack workers’ rights. This would keep Greece’s tax revenues flowing into German and French coffers, while allowing foreign companies operating there to extract even higher margins of profit. Youth despair, mass poverty, and suicides are the result of this ‘rescue plan’.
PARLIAMENT IN CRISIS
Greek workers are bravely resisting the attacks and refusing to see their lives destroyed by austerity plans. Since 2010 the country has had a series of general strikes with mass participation. The most radicalised mobilizations such as those on February 12th, have been organized independently from the trade-union bureaucracies. They have been led by a strong movement of workplace committees and neighbourhood assemblies. They arose from the need to organize and defend from police attacks, spread information about fascist bands, root out provocateurs in their ranks and organize barricades. The Communist Party and trade-union bureaucrats abandoned this movement in all but words.
Their struggle has taken more spontaneous forms, too. Recently a retired man committed suicide in Syntagma square in front of Parliament. This created a wave of sympathy and outrage in Athens. He left a letter which stated that he’d rather take his life before he “would have to resort to rooting through the garbage” for food, because of pension cuts. His assassination by a government who annihilates all hopes of old and young to please its Troika masters, brought about a wave of protests and clashes with the police, further discrediting the ‘national unity’ government.
This pressure has led to many splits in the main political parties of Greece, such as PASOK and New Democracy, as many politicians who backed the cuts try to dissociate themselves from their consequences. There has also been a rise in the left-wing vote. According to polls, the left-wing and extreme left groups may obtain almost 40 per cent of the popular vote. PASOK, who previously held 43 per cent of the legislative votes, is expected to have no more than 11 per cent in the elections, the same as the Greek Communist Party.
Many in the left believe a ‘progressive government’ might come as a result of the elections – one that would go against austerity but not advance with other measures such as the non-payment of the public debt, the departure from the EU and the eurozone, and the nationalization of the banks. However, such a government would be untenable. The Greek debt is unpayable, and the only way to postpone its explosion is with more loans. These can only be obtained by convincing Germany and France that the next Greek government will continue imposing austerity.
There are only two paths to choose from: radically reorganizing the economy, breaking off from the eurozone and mustering the social strength of the Greek and European workers, or accepting the plundering of Greece by austerity in the name of the profits of a few.
A WAY OUT OF THE TRAP
The Greek people have been the victims of a giant scam perpetrated by the central European countries, with full compliance from Greek bankers, big business-owners and politicians.
The “siren’s song” of the single market and single currency have led the Greek economy towards sharp reefs and the few who profited from this crisis in Greece are jumping overboard with all the money they made during the ‘years of prosperity’. It is up to the Greek working class, the only one seriously interested in saving the country, to take the steering wheel of the nation and institute a real rescue plan of the workers and Greek economy.
Workers in Greece and across Europe must unite to stop the cuts. These cuts make the workers pay for a crisis that is not of their making. This will mean the obliteration of Greece’s remaining productive sectors and its political and social submission, with catastrophic costs to the people. Only the unity of the european working-class can defeat the austerity measures.
To restore its economy and create jobs, Greece must urgently leave the eurozone and the EU. With the overpriced euro suffocating Greek exports and production, and with the uneven c o m p e t i t i o n from France and Germany due to the free trade area, any efforts to restart the productive sector will fail.
It is also necessary to immediately stop paying the debt to the bankers, both foreign and national. This ‘debt’ was forced by the Troika and the government upon unsuspecting Greeks against their will. And most of it has already been paid by years of overpriced interest rates. As of 2010, Greece paid an annual 5 per cent of its GDP in interest rates alone.
To prevent those bankers from fleeing the country with their stolen wealth, the banks must be nationalized under workers’ control, using this money to restart the Greek economy, providing badly-needed jobs and rebuilding the country’s health and education services, as well as transport and energy infrastructure.
Remaining in the EU will only mean that it will be easier for the Troika to disrupt any attempt at solving Greece’s structural economic problems and to suppress workers fighting against austerity. If this ship is not to sink, the Greek people must immediately remove the pirates that are leading it to the abyss, and change its course immediately towards a socialist economy. In this struggle, they can count with the solidarity and help of the working-class revolutionaries around the world, in the fight against this common enemy of the workers, the EU.
