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Greece’s center-left seeks stronger ties with the Nazi regime

NOVANEWS

He calls Jerusalem “historic capital” of I$raHell

Greece is looking to work with Nazi regime on developing the latter’s energy industry and transporting natural gas across Europe, Prime Minister Alexis Tsipras told reporters after a meeting with his Nazi counterpart, Benjamin Naziyahu.

“One of the main issues in our talks were the opportunities arising in the fields of energy, the fields of energy in the East Mediterranean,” said Tsipras. “We are considering ways on cooperation in research, drilling and transportation of gas from Israel to Europe,.”

The recent discovery of a large offshore gas reserves close to the city of Haifa could turn I$raHell from a consumer into a supplier of natural energy.

Tsipras also met with Nazi Reuven Rivlin during his first trip to I$raHell, with the two discussing the threat of terrorism.

“ISIS is not only in Syria and Iraq, but spreading to the whole western world, who must take responsibility and say that we cannot live in a world in which ISIS exists,” Nazi Rivlin said at a joint press conference.

While in Jerusalem for the meeting with Nazi Rivlin, Tsipras wrote in the president’s guest book that it was a “great honor to be in your historic capital and to meet your excellencies.”  The comment was significant given that most countries do not recognize Jerusalem as Nazi capital. A former Nazi diplomat called the move “unprecedented, especially for a European leader.”

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Lessons From the Greek Crisis: There Must be Some Way Out of Here!

NOVANEWS
by PETER BOHMER

Protesters-gesture-and-wa-004

I first visited Greece in fall, 2010 to give two talks at a major anti-authoritarian festival in Thessaloniki, Greece’s second biggest city. Anti-authoritarians are a significant political current in Greece. They believe in and organize for anti-capitalism, direct democracy, building non hierarchical economic and social institutions, and confronting austerity. They are very suspicious of electoral politics and political parties. The anti-authoritarians are similar to anarchists here but are a larger proportion of the Greek population. I visited Greece in summer, 2103 where I participated in a conference on the commons and on anti-privatization struggles on an island called Ikaria. I just returned from four weeks in Greece, two weeks on the island of Ikaria and two weeks in Thessaloniki and Athens where my partner and I met with many groups challenging the ongoing economic crisis, many of whom I had met previously in my visits to Greece. In addition, we went to a demonstration in Athens on September 12th, 2015 part of a European wide demonstration in solidarity with refugees entering Europe, and to a large popular assembly in Athens organizing direct action in support of the 300,000 refugees who have entered Greece this year, 2/3 of whom are Afghani, and another one quarter are from Afghanistan and Iraq. They arrive mainly on small boats from Turkey to the Greek islands and then go on to Athens before leaving for other countries, mainly Germany and Sweden.

I will summarize the Greek political and economic crisis, how the Greek government including the “leftist” party in charge has acted and reacted, and how social movements are responding. I will conclude with the current situation and a few thoughts on future possibilities.

I was once again reminded how important what is going on in is Greece when a Vietnamese friend who was very involved in the anti-Vietnam war movement called me in July, 2015. He said, “Just like in the 1960’s and early 1970’s, organizing in solidarity with the Vietnamese people was the right and most important thing to do for people around the world interested in liberation and creating an alternative to U.S, capitalism and imperialism; and acting in solidarity with the revolutionary movements in El Salvador, Nicaragua and Guatemala was central and right in the 1980’s; today learning about and standing up in solidarity with the struggle against austerity and for an alternative in Greece is equally important.

Greece: Recent Past, Present and Possible Future!

Greece has been part of the European Union (EU) and most important for this article, the Eurozone since 2002. This means it is one of 19 nations who use the Euro as their currency; they cannot print their own money.

Greece is one of the poorer nations in the Eurozone and one of the more unequal ones. While in Greece, I wrote a friend in prison who asked me about Greece. I said its income per person today is similar to African-Americans in the United States although Greece’s average income was significantly higher five years ago.

On December 6th, 2008, 15 year old, Alexis Grigoropolous was killed by police while graffittiing in central Athens. In response, a rebellion erupted all over the country, mainly by youths. The underlying issues included high youth unemployment, increasing temporary and low wage jobs, the low quality of education, police harassment and with not a promising future. This activism and rebellion by youths sparked a larger rebellion which has continued. The December 2008 uprising is a major factor in the growth in Greece of an anti-authoritarian political current.

By 2010, because of the evasion of taxes, especially by higher income people, and a growing government deficit and debt, Greece had increasing problems financing its government deficit and in borrowing to pay its debt even at higher and higher interest rates. The Greek government signed its first austerity agreement in 2010, agreeing to cut wages in public sector jobs, lowering the minimum wage and making it easier to fire people, and raising taxes particularly those that affected poor and working class people. This is what is called austerity: balancing the government budget and lowering wages so that Greek goods would be cheaper to produce which would increase Greek exports and decrease imports and spur foreign firms to invest in Greece. In return for agreeing to these policies, Greece got a loan of 110 billion Euros (about $140 billion) at moderate interest rates. Most of these loans went to pay off private banks in Europe who had lent money to Greek businesses, Greek private banks and the Greek government. The loan was extended by the troika—the European Union (EU), the IMF and the European Central Bank (ECB)–who negotiated the agreement. In 2012, Greece got a second loan of 130 billion Euros ($160 billion dollars) in an economy of only 11 million people.

Austerity doesn’t work at least for the large majority of the population as reduced government spending and raising tax rates leads to less income for consumers who then cut back on spending, and also less spending by businesses on new equipment and on construction. These cutbacks increase unemployment. So income and therefore tax revenues fall further, meaning a continuing or growing government deficit requiring yet further tax increases. It is like a dog chasing its tail.

Note: Austerity policies have been followed in the U.S. although not as extremely as Greece but there are ongoing attempts to cut government spending here, especially for social programs and infrastructure at the Federal, State and local levels.

Austerity policies, similar to what have been called structural adjustment policies in Latin America and Africa since the late 1970’s have also been followed by Portugal, Spain, Ireland and Latvia and others with results almost as devastating as Greece. Greece today has over 25% unemployment and an unemployment rate of 60% for people under 25, rates equal to or worse than the 1930’s depression in the United States. These numbers do not begin to explain the devastation in the quality of life in Greece. Much of the employment is part-time with reduced benefits. Poverty is becoming the norm. There are severe cuts in pensions for older people and people are losing their homes in large numbers as they can’t pay the mortgages and the growing property and utility taxes.

The Rise of SYRIZA

In 2012, a relatively new political party, SYRIZA, the Coalition of the Radical Left, campaigned on raising employment by increasing necessary government spending, ending privatization and government layoffs, and cancelling much of the debt owed by the Greek government to foreign lenders and also cancelling the debt of low income people. They came in a close second in the elections getting 27% of the vote where a few years earlier they had received only 4%. SYRIZA was a merger of various Greek groups including those active in the European and World Social Forum, Euro-communists, independent socialists, smaller Marxist groups, etc. The two major parties which had dominated Greek politics were compromised by their support for austerity. This was demonstrated by the sharp decline of PASOK, which has been the major party in Greece since the ending of the military dictatorship in 1974. A lesson for us in the United States is how quickly political parties that seem dominant like PASOK can rapidly decline. PASOK had claimed to be the major progressive party and an anti-austerity one. The same decline could happen to the   Democratic Party here. Austerity has been promoted in Greece and beyond by the international economic and financial institutions such as the IMF, by major banks and financial institutions, by the majority of mainstream economists in the U.S. and the rest of the world and by the mainstream media in Greece and globally.

What had excited me and gave me hope in Greece since I began studying and visiting it was a left political party, SYRIZA, that was connected to many of the social movements, e.g., the solidarity clubs, who are primarily poor people organizing to meet their needs. Also, SYRIZA has supported immigrant, women’s and labor rights. This combined with anarchists, autonomists and anti-authoritarians who were building alternative institutions such as the non-market production and distribution of needed goods and services, free health clinics social centers to meet and build community, creating book stores and alternate media, who were also involved in militant anti-austerity, anti-fascist and anti-mining actions, and who were putting direct democracy into practice seemed to have the potential to revolutionize Greece. To me, this inside–outside, electoral-social movement from below strategy was very promising and seemed to be growing in the period 2010-2014 even if both perspectives were somewhat critical of each other.

By late 2014, the continued decline in Greek national income, employment and tax revenues caused by the continuing austerity policies meant Greece again needed more loans to finance its deficit and its government debt, which was growing as a per cent of the declining national income. In addition most Greek banks were close to bankruptcy because of businesses and individuals not being to pay back the money they had borrowed. The ruling coalition government collapsed and new elections were called for January 25th, 2015.

In this election, SYRIZA ran on a strong anti-austerity although not an anti-capitalist program. It got a plurality of the vote, 36.3%, and under the leadership of Alexis Tsipras, formed a government in coalition with a small, nationalist and conservative but anti-austerity party. From January until the present, October 20th, 2015 most of the their energy has been put into negotiating with the Troika, the IMF, and the EU, especially the German government and the ECB for some debt relief and delays in repayment of the debt, and permission to increase government spending to stimulate employment. Little was done by the Greek government to improve the lives of Greek people or to deepen democracy. The negotiations were led in the winter and spring, 2015 by the Greek finance minister, Yanis Varoufakis, who was met by an unbending and neoliberal European Union who demanded even more cutbacks in government spending, especially of pensions for older workers, more privatization and further increases in taxes before they would extend new loans to Greece and help keep the Greek banks from collapsing.

No to Austerity But Then Yes!

In late June of this year, Prime Minister Alexis Tsipras called for a referendum on whether Greece should accept the terms offered by the European Union and European Central Bank. He called for a No vote, for a no to the further austerity demanded by the European Union. In spite of a near unanimous mass media hysterically promoting a yes vote for austerity; claiming that a no vote and rejecting the European offer would spell economic collapse, over 61% of the Greek people stood up and voted NO on July 5, 2015. This was truly inspiring. Sadly and surprisingly even after this massive rejection of these austerity policies and proposed agreement, Prime Minister Tsipras and most of the SYRIZA leadership said they had no choice but to accept the new austerity package for the promise of a $95 billion bailout that they had campaigned so strongly against.

The European Union than demanded an even worse package than they had originally offered with even more privatization, more control over the Greek government and even larger increases in tax rates and bigger cuts in government pensions saying they would kick Greece out of the Eurozone if they didn’t accept their latest offer. The European Union made an ultimatum of take it or leave the Eurozone. The European Central Bank (ECB) had already stopped sending Euros or making loans to private Greek banks. Greek banks were close to collapsing. Alexis Tsipras then forced this new, even more restrictive deal through the Greek parliament saying Greek had no choice but to accept it even as he called it blackmail. It passed on July 13th, aided by the vote of the more conservative parties. Over 30 SYRIZA members of parliament voted no and formed a new party, Popular Unity, who called for not paying most of the government debt, stimulating the economy, ending the use of the Euro and creating a new Greek currency, the drachma, which was name of the previous currency.

After getting the Greek parliament to pass this new austerity legislation in spite of major protests and the no vote, Tsipras resigned and called for new elections which took place exactly a month ago.

Turnout was reduced from 64% in January, 2015 to 55% on September 20th although SYRIZA got almost the same percentage vote, 35.4% as they had in the January election. Turnout and enthusiasm for SYRIZA were sharply down but SYRIZA is in charge of the government again although the European Union has the real power. Popular Unity, the left split off led by Panagiotis Lafanzis, the former Environmental minister, got only 2.9% of the vote and did not qualify for the recently elected parliament. Hopefully Popular Unity will grow. It needs to connect more with grass roots movements and particularly those involved in building a survival economy such as barter groups and cooperatives.  Fortunately, the fascist party, Golden Dawn, and the recently formed yuppie oriented neoliberal party, POTAMI, the River, did not grow.

The Future of SYRIZA!

I hope I am wrong but think SYRIZA is hopelessly compromised by its accepting of more austerity after campaigning against it in the January 2015 election and again in the July referendum. I had hope for SYRIZA as a part of the solution a year ago. Its youth wing has now left the party, at least temporarily. It will be very hard for SYRIZA to regain people’s trust; even though it still has impressive individuals in it with a history of principled struggle and resistance. SYRIZA has not kept its word and its promises to oppose austerity; it has become another electoral, compromised political party. It is less corrupt than the other main parties in Greece and more concerned about the poor but SYRIZA has lost its way. It was afraid and unprepared to take the anti-austerity leap. Alexis Tsipras and the leadership of SYRIZA feared a collapse of the banks and the Greek economy. SYRIZA will probably go the opportunist way of other social democratic parties. At the very least to regain its legitimacy and progressive role would require strong and honest self-criticism of its turn to the right, the resigning of its leadership, a democratic internal structure, a repudiation of the austerity agreements and a commitment and practice to overturn the accompanying austerity legislation.

I think Greece should have left the Eurozone and ended the use of Euro as its national currency in combination with a program of not paying most of its debt, cancelling the debt of low income people, increasing public production, stimulating domestic production, especially in agriculture and food, taking over the private banks and creating public or community banks to support worker cooperatives and employment creating production. Controls over imports would have been necessary to balance exports as would have and preparing for the use of a new currency. In addition and probably most important, neither SYRIZA nor other groups did the necessary educational work with the Greek population to explain what these alternatives such as leaving the Eurozone would mean and why they are necessary. From my observation and reading several polls, the majority of the Greek people strongly opposes austerity but do not support leaving the Eurozone or the European Union. Without popular education, what is called Grexit, Greece replacing the Euro with its own currency and leaving the Eurozone, becomes another technocratic policy from the top. These alternatives presented in this paragraph will again be relevant in the not too distant future.

Many in SYRIZA and many other Greek activists and left academics outside of Greece believe Grexit would be an economic catastrophe. As an alternative they advocate for a European left united across countries that can challenge the European Union’s right wing economics; that Greece cannot go it alone. Their solution is a more progressive European Union. At the present time, there is not a strong European left capable of effectively challenging the right wing economics of the EU and Eurozone. Greece leaving the Eurozone and having its own money together with the other reforms mentioned could have been a start towards a new participatory socialist politics and economics.

The Future!

There is a lot of fear by the economic and political elites inside and outside of Greece, of Greece demonstrating in practice that there is an alternative to neoliberalism and capitalist globalization. That is why they the leaders of most countries of the European Union were so unwilling to compromise. Greece staying in the Eurozone means continued economic depression, maybe a little more slowly at first than if they had left, but guaranteed to last.

It is easy to take as a lesson from SYRIZA accepting this extreme austerity package without even a promise of large debt relief– that political parties will always sell out. I still believe it is necessary, desirable and possible to develop visionary and radical and democratic (small d) political parties rooted in people’s daily life and in social movements; ones that are feminist and ecological and have an electoral component and are willing to take risks. Rather political parties that are primarily or totally electoral, where winning elections and taking control of the government becomes their be all and end all that are politically and morally bankrupt.

There is a lot of despair right now in Greece but as recently deceased baseball player, Yogi Berra said, “It is not over until it is over”. This cynicism in Greece towards participation in collective social change and political activism has grown for most of the population. Increasing time and focus is being put into individual and family survival but not collective survival, towards increased work in the informal labor market, in struggling individually and together with one’s family to survive on declining incomes and pensions, to trying to keep one’s home or planning to emigrate to other countries such as Germany. The decline of hope is also true from what I observed of activists in SYRIZA who are deeply angered by both the lack of democracy in recent decisions by the SYRIZA leadership and by the decisions they have made. This pessimism is also shared by grass roots movements and activists, many of whom had hoped for more from SYRIZA after their victory in January. Optimism about the future of Greece has markedly decreased as has activism across the left and radical spectrum. One positive sign is that there is a lot of support in action for the hundreds of thousands of refugees entering Greece even if the popular ideology is less welcoming.

Hopefully, it is the temporary lull before the storm. There is no way that the SYRIZA led government can meet the European Union and European Central bank requirements of government surpluses by 2017 and even bigger requirements for a primary surplus in 2018. So there will be likely be new demands in the not too distant economic future by the EU and international economic powers for even further cutbacks in government spending and more selling off of Greece to the highest bidder. There is likely to be mass resistance, it is already beginning to grow as more and more as the austerity package is being voted on piece by piece at the time of this writing. This economic depression in Greece is likely to continue for the foreseeable future unless there are new social movements and political parties of a new type, such as I have described, building the power and the vision and strategy to cause transformative change combined with needed solidarity from people around the world. The latter has been lacking.

Greek working people and students have an inspiring history of resistance to dictatorship and fascism, e.g., in World War II against the Nazi occupation, to the military junta from 1967-1974, and to demonstrating, striking, organizing, rioting and voting against austerity and for a liberatory although unspecified alternative. It can and will happen again. Si Se Puede!

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SYRIZA’s Pyrrhic Victory, and the Future of the Left in Greece

NOVANEWS
Global Research
SyrizaFlags

In the wake of the September 20 Greek election SYRIZA has once again formed a coalition government with a small right-wing party, ANEL. Both parties lost votes and seats but their standing, like those of most other parties, was not very dissimilar to the results in January, when SYRIZA was first elected.

SYRIZA’s 35.46% and ANEL’s 3.69%, combined, were sufficient to give them a majority of 155 seats in the 300-seat parliament under Greece’s electoral law, which gives 50 additional seats to the party with a plurality, in this case (as before) SYRIZA. However, voter turnout was at an all-time low, 44% of the electorate abstaining although voting is mandatory in Greece. This means that SYRIZA was supported by only 20% of eligible voters.

And this is a very different party, and government, than the one elected in January.

SYRIZA received the highest vote of any party in January on the basis of its promise to end the brutal austerity Greece has suffered in recent years at the hands of its creditors – the other countries that use the euro, the European Central Bank, and the International Monetary Fund (IMF), referred to collectively as the “Troika.” But this time neither SYRIZA nor ANEL could credibly promise opposition to austerity. They are committed to enforcing the harsh austerity terms imposed on Greece in July when Prime Minister Alexis Tsipras capitulated to the Troika only days following a national referendum in which 61% of the voters had strongly affirmed their opposition to austerity.

Moreover, SYRIZA will now govern without its left wing, which opposed submission to the new memorandum. The SYRIZA dissidents, previously grouped as the party’s Left Platform, joined recently with a number of small anti-austerity parties to found Popular Unity, a self-described “social and political front to overturn the memoranda, predatory austerity, the negation of democracy, and the transformation of Greece into a European colony by means of indebtedness.” However, Popular Unity, with only 2.86% of the popular vote, fell short of the 3% required for representation in parliament.

Troika the Big Winner

Yanis Varoufakis, the finance minister in the previous SYRIZA government,accurately described the election result:

“The greatest winner is the troika itself. During the past five years, troika-authored bills made it through parliament on ultra-slim majorities, giving their authors sleepless nights. Now, the bills necessary to prop up the third bailout will pass with comfortable majorities, as SYRIZA is committed to them. Almost every opposition MP (with the exception of the communists of KKE and the Nazis of Golden Dawn) is also on board.

“Of course, to get to this point Greek democracy has had to be deeply wounded (1.6 million Greeks who voted in the July referendum did not bother to turn up at the polling stations on Sunday) – no great loss to bureaucrats in Brussels, Frankfurt and Washington DC for whom democracy appears, in any case, to be a nuisance.

“Tsipras must now implement a fiscal consolidation and reform programme that was designed to fail. Illiquid small businesses, with no access to capital markets, have to now pre-pay next year’s tax on their projected 2016 profits. Households will need to fork out outrageous property taxes on non-performing apartments and shops, which they can’t even sell. VAT rate hikes will boost VAT evasion. Week in week out, the troika will be demanding more recessionary, antisocial policies: pension cuts, lower child benefits, more foreclosures.

“The prime minister’s plan for weathering this storm is founded on three pledges. First the agreement with the troika is unfinished business, leaving room for further negotiation of important details; second, debt relief will follow soon; and third, Greece’s oligarchs will be tackled. Voters supported Tsipras because he appeared the most likely candidate to deliver on these promises. The trouble is, his capacity to do so is severely circumscribed by the agreement he has already signed.

“His power to negotiate is negligible given the agreement’s clear condition that the Greek government must ‘agree with the [troika] on all actions relevant for the achievement of the objectives of the memorandum of understanding’ (Notice the absence of any commitment by the troika to agree with the Greek government.)”

It was the third promise – to fight the oligarchs who got Greece into this mess in the first place – that was key to Tsipras’s re-election, says Yaroufakis.

“Having accepted a new extend-and-pretend loan that limits the government’s capacity to reduce austerity and look after the weak, the surviving raison d’être of a leftwing administration is to tackle noxious vested interests. However, the troika is the oligarchs’ best friend, and vice versa. During the first six months of 2015, when we were challenging the troika’s monopoly over policy-making powers in Greece, its greatest domestic supporters were the oligarch-owned media and their political agents. The same people and interests who have now embraced Tsipras. Can he turn against them? I think he wants to, but the troika has already disabled his main weapons (for example by forcing the disbandment of the economic crime fighting unit, SDOE).”

Tsipras’s Election Maneuver

The September election was a consequence of fundamentally undemocratic maneuvers by Tsipras designed (in the words of the DEA, a Popular Unity component) to “confirm the balance of political forces and reestablish the viability of the SYRIZA-led government before workers and popular classes realize through their own bitter experience the actual content of the agreement that was signed with the creditors on July 13.” A second objective was “the purging of the left wing of his party, even if the price that he had to pay for that was the organizational disintegration of SYRIZA.”

Tsipras was supported fully in this by the vast majority of the mass media in Greece, “which played a decisive role in organizing and promoting a pre-electoral public discussion where there was almost complete silence on the issue of the new Memorandum – which is the main issue of the political struggle!” The media

“slandered the Left Platform ruthlessly, while hiding the extent of the wave of resignations and withdrawals of a huge number of activists who had built SYRIZA all those years – among them, the secretary of the party, half of the elected members of the Political Secretariat, a big part of the members of the Central Committee, and leading cadre from lots of local and working-place branches.”

“The main precondition for the success of the SYRIZA leadership’s strategy,” says the DEA in its post-election analysis, “was the spreading disappointment and weariness among the people who were active in the social movements, including SYRIZA’s base of political support.”

“That was the point and the goal of the ‘There Was No Alternative’ argument to justify the new Memorandum. This message was repeated constantly, like a mantra, by leading members of SYRIZA, along with the five-party coalition – including SYRIZA, New Democracy, PASOK, the Independent Greeks and Potami – that was built in parliament around the consensus to ratify the new shameful Memorandum….

“A large part of the population, seeing that the anti-austerity project of SYRIZA was collapsing, started to believe that the overthrow of the Memorandum is impossible. It has started to accept that trying to implement Memorandum policies ‘with a human face’ is the only realistic alternative.

“It was this retreat, along with the recent memory of the ferocity of the politics of New Democracy and PASOK while in control of the government, that produced the political and electoral victory of Alexis Tsipras on September 20.”

The events since mid-July mark “a change in the political mood and – at least temporarily – in mass consciousness,” says the DEA.

“Facing this prospect, our only possible response is the struggle from below: Strikes, demonstrations, occupations and more to defend workers’ rights and social rights. In order to crack the image of the SYRIZA government’s popular legitimacy created by the electoral result on September 20, these struggles must be decisively supported by activists of the left.

“Recent experience shows us that in order for such struggles to prevail, they will need a political expression. They must coalesce around a political current that aims to organize a challenge to austerity. In this, the section of the left that resisted and stood against the maneuvers of Tsipras has very special tasks.”

Popular Unity

In these difficult conditions, Popular Unity (PU) was founded in August to attempt to carry forward the best traditions of SYRIZA, the acronym for the original Coalition of the Radical Left. Popular Unity encompasses some 15 organizations ranging from left social democrats and social movement activists to far-left currents. They are described in the introduction to the Jacobintranslation of the Popular Unity election platform.

The PU platform, while adopted hastily for the snap election, illustrated the broad agreement among these forces on the “prerequisites for a radical alternative solution to the disaster of the memoranda.”

“The basic features of the alternative route have already been mapped out by numerous leftist groupings, radical movements, and progressive scholars. The alternative solution we embrace seeks to provide answers to all the key problems of the economy, society, the state, and foreign policy. Naturally it is not confined to monetary policy, as is asserted by the swindlers and slanderers who speak of a ‘drachma lobby’.”

And the platform modestly added:

“The problem with this alternative proposal is not its supposedly inadequate ‘technical’ elaboration but its inadequate political preparation: namely, the fact that it has not been discussed as much as it should have been among the people and the social organizations – among those, in other words, who will be called upon to put up a tough struggle against colossal vested interests in order to implement it. We plan to fill this gap immediately, through a great campaign of public dialogue….”

The platform goes on to propose a series of “immediate emergency measures”: abolition of the memoranda “and the accompanying loan agreements that mortgage our future”; suspension of debt repayments, “with a view to effecting an overall annulment of the debt, at least the greater part of it”; an “immediate end to austerity and implementation of a policy of redistribution of social wealth to the benefit of working people and at the expense of the oligarchs”; “support for wages and pensions, and social expenditures for free public education, popular health care, and culture”; nationalization of the banks and their operation under a regime of social control,” etc.

In addition, “radical reforms will be promoted to change the bankrupt developmental model and overturn the balance of social forces to the advantage of the people and to the detriment of the oligarchs of crony capitalism.”

These include

  • radical changes in labour legislation;
  • establishment of “a permanent, socially just, and redistributive taxation system”;
  • an end to “predatory privatizations”;
  • restoration of the national health system and public hospitals;
  • a new emphasis on industrial and agricultural production based on “democratic central and regional planning, with participation and joint decision-making from local communities and a distinct environmental dimension”;
  • strengthening of the social economy (cooperatives, self-managing enterprises that have been abandoned by their owners, solidarity networks, etc.);
  • and “a policy of solidarity and humanism for refugees and economic immigrants.”

The platform acknowledges that “cancellation of the memoranda in itself – and even more so the radical structural changes we have described – will face fierce resistance from the dominant forces in the EU.”

“They will immediately try to throttle our effort, using as their basic instrument the cutting off of liquidity to the banks by the ECB. We have already experienced this in the last six months, even with the much more moderate policies of the SYRIZA-ANEL government.

“Therefore, the question of an exit from the eurozone and of a break with the neoliberal policies and choices of the EU… will be placed on the agenda not as the product of some ideological obsession but in terms of basic political realism.”

The establishment of a national currency, the platform explains, is not an end in itself. “It is one of the necessary instruments for the implementation of the radical changes we have outlined, for which, indeed, the ultimate guarantor will be not the currency but the struggle of the popular classes.”

“Whatever the inevitable difficulties of the first months, nothing justifies the stance of those Cassandras who equate such a move with economic disaster and national ruin. In the course of the twentieth century, sixty-nine monetary unions collapsed on this planet without this signifying the end of the world. The introduction of a national currency as a prerequisite for implementation of a progressive program for reconstruction and a way forward is not only a viable option; it is an option of hope, with the potential to launch the country on a new developmental trajectory.”

Popular Unity orients toward

“a new independent multi-dimensional international relations policy, in the domains of energy, economics, and politics. International relations that will not be imprisoned in the straitjacket of the EU. We aspire to an energy policy of collaboration in the Mediterranean, the Balkans, and the Middle East. A policy that will take advantage of the new opportunities for mutually beneficial collaboration with the emerging economies of the BRICS nations, Latin America, and other regions of the planet.

“We are against the new ‘Cold War’ and a new division of Europe with the erection of new walls against Russia. We oppose the imperialistic options and the military adventurism of NATO. We are pledged to the exit of Greece from this coalition, a war machine that disintegrates states, tyrannizes peoples, and destabilizes the wider geopolitical arc of our region from eastern Ukraine to the Middle East. We campaign for the removal of the American-NATO bases, for non-participation of Greece in any imperialist organization.”

The platform also calls for termination of military collaboration with Israel, immediate recognition of Palestine, and opposition to the EU’s Transatlantic Trade and Investment Partnership (TTIP) “now being hatched.”

And it calls for radical transformation of the state, the judiciary and public administration, including disbandment of Greece’s notorious “riot police” (many of whom are Golden Dawn members or supporters).

“We will moreover launch wide-ranging social consultation for in-depth revision of the Constitution and the political system by a new constituent assembly to emerge from subsequent elections. A central objective of this new revision will be establishment of a new, much more advanced democracy, conjoining representative with direct democracy, with provision of a significant margin for popular initiative and self-activation, popular participation and direct popular decisions, on the basis of the international best practices and experience.”

Not a Finished Product

This was a strong platform, addressed to meeting the key challenges in the period ahead. But Popular Unity is not a finished project, says DEA leader Panos Petrou.

“The main objective at the moment for Popular Unity is to avoid the Italian scenario – that is to say, to avoid what happened to the Italian left after the collapse of the Romano Prodi center-left government and the subsequent collapse of the Party of Communist Refoundation that supported Prodi (PRC by its initials in Italian). PRC support for Prodi led to a fragmentation on the left, which continues to this day. Those who continue on in very small groups are trying to rebuild.

“We are trying to create, as we put it, a refuge for all left-wing activists betrayed by SYRIZA who want to keep up the fight that SYRIZA began. Our main objective is to keep the flame of resistance alive, especially for those who voted ‘no’ in the referendum and are now faced with a new Memorandum.

“We need a left voice to speak against this new Memorandum, just as we spoke up against the old ones. We need the left to continue this fight – a fight which was cut short by the SYRIZA leadership.”

In its post-election analysis, the DEA leadership drew attention to what it termed “important subjective, political mistakes” in the Popular Unity campaign.

“Faced with the pressure from our political opponents, who argued that obedience to the European leadership is obligatory, we overemphasized support for an exit from the eurozone. At some point, this necessary part of our overall argument was singled out and raised above a more general program of organizing a united class movement against austerity and an anti-capitalist program toward socialist emancipation. That was a gift to Tsipras and the mass media, who looked for every opportunity to slander us as ‘drachma left’.”

Overall, however, the analysis was positive:

“Despite all this, Popular Unity received 155,000 votes, and it has already rallied an organized layer of thousands of activists and experienced veterans of the working-class movement and the left. This gives us the strength, despite losing the first battle, to engage in the war that is coming.

“Of course, for this to happen, we need to resolve, in an effective and democratic way, all the organizational, political and programmatic questions about Popular Unity that were naturally left aside during the brief period before the elections.”

The Sectarian Left

The one left party that outpolled Popular Unity in this election was the Communist Party, known as KKE in its Greek acronym. Historically, it was the pro-Moscow CP that remained after a Eurocommunist faction broke to form Synaspismos, later a founding component of SYRIZA. (The Eurocommunist current, which developed in several southern European countries, generally held out the perspective of “democratizing the apparatus of the capitalist state, transforming it into a valid tool for constructing a socialist society without needing to destroy it radically by force.”)

The KKE vote increased marginally, from 5.47% in January to 5.55% this time. “But the fact that this happened in a situation where SYRIZA was in crisis and split, and after Tsipras had just signed a new Memorandum of harsh austerity, shows that there is no cause for celebration,” says the DEA.

“The politics of the leadership of the KKE failed to capitalize a rare opportunity. During the pre-election period, the KKE aimed its attacks almost exclusively against Popular Unity, in the hopes of claiming all votes of left-wing opposition to SYRIZA for itself. This tactic leaves all the promises on the front page of the party’s newspaper about initiatives to form some sort of popular alliance in doubt.”

As for the smaller anti-capitalist alliance ANTARSYA, its vote likewise increased marginally, from 0.64% in January to 0.85% this time.

“In its statement after the elections, the New Left Current (NAR), one of the main components of ANTARSYA, set as its goal ‘a broad militant front to overthrow the coming storm of anti-worker measures…the commitment to joint action from all the parts of the militant left, including the Communist Party and Popular Unity.’

“The problem is that this statement was issued a day after the election and not three weeks before it. In the electoral battle of September 2015, the ‘forces of the militant left’ failed to provide a common response, which was necessary.”

Had ANTARSYA overcome its refusal to join the Popular Unity (echoing its earlier sectarian refusal to join the old SYRIZA as a recognized platform), it is conceivable that Popular Unity could have won enough votes to be represented in parliament. Some currents within ANTARSYA did in fact join Popular Unity.

The Witch-Hunt Against Zoe Konstantopoulou

Among those “activists and experienced veterans of the working-class movement and the left” who joined Popular Unity, reports Panos Petrou, were well-known public figures, such as Zoe Konstantopoulou, a SYRIZA deputy “who served as president [speaker] of the parliament… before she resigned in protest of the new Memorandum, and Manolis Glézos, the 93-year-old Greek resistance fighter.”

Zoe Konstantopoulou was in my own opinion the authentic heroine of the first six months of the SYRIZA government. Among her progressive initiatives, she got the parliament to establish the Truth Committee on Public Debt, coordinated by Eric Toussaint, president of the Belgian-based Committee for the Abolition of the Third World Debt. Its preliminary audit, as I reported in my earlier article, provided documentary proof that most of Greece’s foreign debt claimed by the EU and IMF creditors should be considered illegitimate, illegal and odious, and its repayment unsustainable. It urged the adoption of a series of measures that could have been taken in response to the financial blackmail of the Troika, but were rejected by the Tsipras leadership.

When Tsipras moved to force the new Memorandum terms through parliament without even the minimal debate required, Konstantopoulou was one of the strongest voices in opposition and in defense of the institution’s own democratic procedures and the sovereignty of Greece. Since then, she has continued to fight austerity and the Troika’s violation of Greece’s sovereignty, both in Greece and abroad.

This has earned her the hatred of the mainstream media in Greece, described with appalling examples by Sonia Mitralias: See “In Greece, sexist rampage against resistance to memoranda – The case of the former President of the Greek Parliament and the new witch hunt.” Writes Mitralias:

“From the moment Zoe K. stepped up to become an important figure of the opposition to the Memoranda that have ruined Greece, she was denigrated, vilified, humiliated, slandered … in short, demonized by those that are on the Troika bandwagon. The attacks against her are so persistent, organized, coordinated and systematic that they can only be perceived as a real strategy of warfare aimed at her political elimination from the public arena.

“It would be wrong to attribute this ‘extremely sexist phenomenon’ to phallocratic or random individual behavior or anachronistic mentalities, as is claimed by the feminist politics section of the (old) SYRIZA in a statement entitled ‘The sexist attacks against Konstantopoulou are anachronistic stereotypes’. This is a modern-day witch hunt!”

And it is a foretaste of the campaign that will be waged with increasing ferocity in the media and in legislative repression against all movements fighting the implementation of the new austerity under the current Memorandum.

A Provisional Balance Sheet

Addressing a conference in Switzerland in mid-September, Popular Unity (and DEA) leader Panos Petrou summarized the experience to date in building a radical left alternative to capitalist austerity in Greece in the following words:

“Despite its bitter ending, the existence of SYRIZA itself was a victory for Europe and the Greek working class. It was this that opened the door to important advances in the Greek class struggle, of which the most important was the historic July 5 referendum – with the great victory for the ‘no’ vote of 61 per cent, despite all the blackmail and threats. That was a tremendous political moment in Greek history, and it would not have been possible without SYRIZA’s victory on January 25.

“The pain suffered during these seven months of government have also raised the political consciousness of a large part of the Greek working class in terms of how to fight for the end of austerity and against the limits of the eurozone. This rise in consciousness could not have been brought about without the years of revolutionary propaganda on the part of various groups. But then, it might not have happened with just the years of revolutionary propaganda alone – without the living experience of these seven months.

“This bitter ending was not predetermined. It was not a given. Things might have gone in another direction, and there were many other alternatives to the official line. We did not have the strength to impose a different course on the government. A different course depended on forces much broader than DEA and other left-wing currents – it required broader social forces from within the working-class movement. That is how we must evaluate the past months’ course in order to try to change the future course.”

And it required massive solidarity from the European left as a whole, a solidarity that was sadly lacking.

International Solidarity

In a recent article, Leo Panitch argues that the current crisis of world capitalism:

“has fully exposed how far the world’s states are enveloped not just in the American state’s internal contradictions but even more so in global capitalism’s deeper irrationalities. And it has also shown that the salient conflicts in the world today are class conflicts within states, including the American ones, rather than conflicts between them.”

In my opinion, the Greek events point us to a necessary caveat to the second sentence I have quoted. Panitch is correct to exclude the likelihood of national struggles by capitalist ruling classes comparable to the inter-imperialist conflicts of early 20th century imperialism; as he says, the rapid emergence of some of the largest countries of the formerly underdeveloped third world (such as China) “requires that their states [i.e. their national bourgeoisies] play a more active role in the management of global capitalism.”

But on the other side of the ledger, the radical left forces that develop within the individual capitalist countries – especially those that manage to form the government – are confronted not only with their national bourgeoisies but – as Greece’s recent experience shows so clearly – with the enormous economic, financial and political clout of the imperialist institutions that are so integral to the structures and management of global capitalism.

As a consequence, the class struggle within a country like Greece is not purely economic, and directed solely or even primarily against its ruling class (most of the working-class struggles Panitch cites are economic – strikes and labour mobilizations from China and India to the United States, struggles within these states), but also national, in defense of state sovereignty and thus profoundly international in content, dependent for their success on the active solidarity of working-class and progressive forces in other countries; in Greece’s case, starting within the European Union. This is a defining feature of anti-capitalist resistance in contemporary imperialism, as the Memorandum’s neocolonial trusteeship over Greece so egregiously illustrates.

Some Sage Advice and Solidarity from Bolivia

Speaking in Athens in June, shortly before the referendum on the Troika’s draconian terms, Bolivian vice-president Álvaro García Linera eloquently addressed this problematic.

There is an adverse correlation of continental forces, you are alone today, he told his audience. In Latin America in the 1980s, we were confronted with demands by the IMF and World Bank to pay external debts amounting in some cases to more than the annual GDP. But unlike you Greeks, we had multiple creditors and we were able to divide them, settling with some but not others. The major debtor countries were able to form a bloc strong enough to renegotiate our payments to the international agencies, often on terms as favourable as 10 cents on the dollar. Unfortunately, the countries with similar debt problems in Europe, such as Spain, Portugal, Italy or Ireland, have refused to support your effort.

But it is precisely in such difficult conditions, said García Linera, that the left can demonstrate its capacity to lead. Had they not managed to cope with an imperialist world war, famine, and similar problems, “Lenin and the Bolsheviks would have continued to be a group of semi-clandestine activists.”

“When everything is going well a left is not needed; when things go very badly, the left is needed and if we are not prepared to lead when things are going badly we are not leftists.”

Secondly, he said, all EU countries have lost their capacity to control their economy over the last 15 years. They have mortgaged Europe to a cloud called the European Union which is “basically a coalition of bankers and some firms that define the fate of the Europeans, and that is very sad.” He contrasted this with the situation of Bolivia, “where we are able to ourselves define the exchange rates, the monetary mass, to force banks to lend money to the state,” etc. But you can’t, because everything is under the control of the European Bank.

Thirdly, “the Troika want to destroy you, don’t have illusions that the Troika is acting in good faith, or that it is flexible.” They want to foreclose you as a good example for other countries. So you get “exemplary punishment.”

Acknowledging that the Greek people seemed to be showing signs of fatigue with the incessant stalemate in the negotiations with the Troika (“People have to work, look after their homes, attend to personal matters”), the Bolivian vice-president reminded his audience that the left, as Marx said, had to know how to measure the varying tempos of social mobilization, both collective action and retreat. This puts a premium on direct contact of the government and its leaders with society through the media, meetings with the unions, and with the various social movements. “A revolutionary government of the left must always ensure that its decisions are based on informed consultation and discussion with the people.”

In conclusion, he said, “I do not know how it can be done, but it is essential that the Greek government, the Greek people, have the minimal economic power to make decisions… a capacity for economic management, economic resources that allow you to gain more time, to adopt measures of a social character that benefit people, to resolve this or that problem independently of what the banks and the Troika do.”

And lastly, you need solidarity. “Europe must wake up.” In Latin America we are watching closely, and “we place our hopes of a rebirth of Europe in you, not the banks; in the Europe of the peoples, not the Europe of the Troika….

“People have to understand that Greece cannot be left alone. Greece cannot approach these negotiations as a purely administrative matter; it is a political question, a social question. Time is running against us, it is in favour of the Troika.”

European Responses

European left responses to the Greek events have varied widely. Gregor Gizi, outgoing president of the German left party Die Linke, has supported Alexis Tsipras and attacked Popular Unity. Similarly, Pablo Iglesias, the leader of Spain’s Podemos, gave full support to SYRIZA, even speaking at its closing election rally.

However, these parties are divided. The Die Linke section in Rhine-Westphalia, Germany’s most populous state, has sharply criticized the Greek government’s decision to sign on to the Memorandum and has characterized Popular Unity as the “best expression of the NO of the Greek people.” Sarah Vagkenknecht, who is expected to become co-chair of Die Linke, has called on the new Greek government not to apply the Memorandum.

Moreover, Oskar Lafontaine, the historic founder of Die Linke, has co-signed a statement calling for “A Plan B in Europe with Jean-Luc Mélenchon, co-founder of France’s Parti de Gauche, Stefano Fassina of Italy, and Zoe Konstantopoulou and Yanis Varoufakis of Greece. The statement, issued September 11, declares in part:

“We live in extraordinary times. We are facing an emergency. Member-states need to have policy space that allows their democracies to breathe and to put forward sensible policies at the member-state’s level, free of fear of a clamp down from an authoritarian Eurogroup dominated by the interests of the strongest among them and of big business, or from an ECB that is used as a steamroller that threatens to flatten an ‘uncooperative country’, as it happened with Cyprus or Greece.”

Most European governments, it says, “representing Europe’s oligarchy, and hiding behind Berlin and Frankfurt,” had a plan A: Not to yield to the European people’s demand for democracy and to use brutality to end their resistance…. and a plan B: To eject Greece from the Eurozone in the worst conditions possible by destroying its banking system and putting to death its economy.

“Facing this blackmail, we also need a plan B of our own.”

“Our Plan A for a democratic Europe, backed with a Plan B which shows the powers-that-be that they cannot terrorise us into submission, is inclusive and aims at appealing to the majority of Europeans. This demands a high level of preparation. Debate will strengthen its technical elements. Many ideas are already on the table: the introduction of parallel payment systems, parallel currencies, digitization of euro transactions, community based exchange systems, the euro exit and transformation of the euro into a common currency.

“No European nation can work toward its liberation in isolation. Our vision is internationalist. In anticipation of what may happen in Spain, Ireland – and potentially again in Greece, depending on how the political situation evolves – and in France in 2017, we need to work together concretely toward a plan B, taking into account the different characteristics of each country.

“We therefore propose the convening of an international summit on a plan B for Europe, open to willing citizens, organisations and intellectuals. This conference could take place as early as November 2015.”

An earlier joint statement, issued September 5, calls for an “Austerexit,” an exit from austerity, referencing the threat of a Greek exit from the eurozone. It is signed by Olivier Besançenot of the Nouveau Parti Anticapitaliste in France; Antonis Davanellos, a leader of Popular Unity in Greece, and Miguel Urbán Crespo, a Podemos member of the European Parliament.

“From this point forward, we know just how antithetical membership in the euro currency system is with a policy of emancipation in the Greek case.

“For us, what is most critical is to end the policy of austerity, be it within the framework of the euro if the situation permits it, or outside it, if the people cannot achieve their aspirations. We do not confuse the means with the ends – we are not partisans of this or that currency because the real question before us is to know who controls the monetary system. Whether the credit system is based on a national or European currency does not change much as long as either of these remain under the influence of the traditional groups of the financial speculators who make up their own banking laws.”

The signers likewise call for “the organization of a great European-wide conference of social and political resistance in the coming weeks… to debate the meaning we can give to this campaign for an ‘Austerexit’.”

It is to be hoped that the various leading activists of the European left can coordinate their efforts and reach agreement on common action in defense of Greece and for a far-reaching debate on a new approach to the European Union that points the way to “a new Europe” free of domination by capital.

Richard Fidler is an Ottawa member of the Socialist Project. This article first appeared on his blog Life on the Left.

Notes

1. SYRIZA is the acronym of the Coalition of the Radical Left, a reference to the combination of parties that founded it in 2004. ANEL stands for Independent Greeks-National Patriotic Alliance.

2. See also “Eurozone’s enforcer ready to keep Greece’s new leader in line.”

3. The International Workers Left (DEA, by its initials in Greek) was a main voice in the Left Platform within SYRIZA.

4. The earlier history is described in my article “Greece: Was, and Is There, an Alternative?

5. Spanish CP leader Santiago Carrillo in his book Eurocommunism and the State (1977). Quoted by Alan Thornett in “Greece & Europe: The capitulation of the Tsipras leadership and the role of ‘left europeanism’,” www.internationalviewpoint.org/spip.php?article4217.

6. See “The complete subordination of a democratic country to the will and demands of other governments is not an agreement,” cadtm.org/Zoe-Konstantopoulou-s-speech-in.

7. See “Zoe Konstantopoulou’s speech at the United Nations Headquarters in New York,” cadtm.org/Zoe-Konstantopoulou-s-speech-at.

8. See also “Greece: Violence against women, a strategic weapon in the hands of the rulers in a time of class war,” www.europe-solidaire.org/spip.php?article35890.

9. “Rethinking Marxism and Imperialism for the Twenty-first Century,” 23 New Labor Forum 2, 2014, pp. 22-28.

10. See “En Grecia se está definiendo la historia y el futuro de Europa,” Cambio, 21 June 2015, Discurso presidencial, pp. 24-32.

11. See SARAH VAGKENKNECHT: “I find it hard to congratulate SYRIZA.”

Posted in GreeceComments Off on SYRIZA’s Pyrrhic Victory, and the Future of the Left in Greece

Managing the Occupation: Syriza Wins Again, … on Behalf of the Banksters

NOVANEWS
Global Research
syriza

Greeks are the victim[s] of anti-democratic and criminal policies that carry with them the threat of a humanitarian crisis. Zoi Konstantopoulou, The Daily Beast, Sep 20, 2015

Alexis Tsipras of Syriza has clearly decided that the election is one of the best ways of sanctifying controversial programs. (Greece has had five in six years.) Earlier this year, having promised an anti-austerity stance, Tsipras gradually, then dramatically, changed his tune. Syriza, it seemed, was shedding its skin in government. They were becoming the very managing technocrats they had despised.

The Troika, breathing heavily down Tsipras’ neck, and the economic fundamentalists insisting that belt tightening, slashing budgets and imposed taxes were the way to go, got what they wanted: Greek capitulation. The stormy narrative of blackmail, giving Greek citizens the impression that a vote against any austerity measure directed by the EU and facilitated by the banking system would be a vote against Europe, had worked.

This message certainly got through to Tsipras, who started to veer erratically despite claiming to be a shining hope against the Troika’s financial vultures. While he did have the mandate to fall back on in July, loans were maturing and payments due. His justification for then accepting yet another bailout package, this time over three years totalling $97 billion, seemed like a total surrender. As he prevaricated, the economic situation worsened further, and banking restrictions were introduced to prevent a run.

The move by Tsipras was justified using the EU’s rhetoric: not accepting the very bailout he had campaigned against meant an effective withdrawal from the union. Tsipras was placing country above party, a curious term of reference given that his country was effectively being bargained away. This all seemed a cruel act of bandaging, a temporary suspension of chaos.

The anti-austerity advocates who insisted that a program without actual incentives for economic growth was no program at all, were shunted aside. The finance minister Yanis Varoufakis received what effectively were marching orders to pacify the stormy waters of negotiation and was left battling the bailout measures as a backbencher.

As Tariq Ali suggested, the date of “12 July 2015, when Tsipras agreed to the EU’s terms, will become as infamous as 21 April 1967.” One coup, effectively, entailed finance and the banksters; the other, tanks and the military junta.

This election, precipitated by Tsipras’ loss of a parliamentary majority, was effectively an attempt to quell the influence of the anti-austerity camp within Syriza itself. Some had left to form the Popular Unity party (LEA), though it fell short of the parliamentary threshold of 3 percent. “We lost the battle, but not the war,” claimed the new party’s head, Panagiotis Lafazanis, Tspiras’ disgruntled former energy minister.

Effectively, the anti-bailout grouping has been reduced to those among the extreme nationalist Gold Dawn and Communist Party within parliament, and Popular Unity from without. This is a far cry from January, when the austerity campers were given the fright of their lives with Syriza’s victory.

Opponents this time around were hoping that the coalition had been sufficiently weakened by the loss of its majority in July for New Democracy to take over, but there is, in substance, very little difference between the main parties. This was Tsipras in the realm of cosmetics and appearances, retaining some modified slogans, and still giving the impression that Syzira was the barnstorming party of old. It seemed an exhausted vote over terms people already knew would be implemented, irrespective of who won.Syriza got 35.5 percent to New Democracy’s 28.2, and Tsipras is now in a situation he was in before, negotiating with Panos Kammenos of the Independent Greeks Party, who should seriously consider renaming his party with the “Independent” tag dropped.

The language from EU ministers to this election result was certainly less hostile than it had been in earlier July, when Greek electors voted to repudiate the terms of the third EU bailout in the July 5 referendum. Tsipras was doing what was expected: shoring up support in parliament to keep the creditors happy.

EU Commission spokesman Margaritis Schinas represented the mood in purely financial terms. The EU, he claimed, was pleased at the “ample representation of pro-European political parties in the Greek parliament, defending the need for a strong Europe within the euro area.”[1] Never mind a weaker, unequal Greece – all was being done for the euro.

For all that, the leopards of EU administration have not changed their spots. Martin Schulz, the European parliament’s president, could not resist that habitual anti-democratic tendency from Brussels, calling Tsipras “a second time to ask him why he was continuing a coalition with this strange, far-right party.”

What this election result simply does is prolong the anti-democratic program of suffering, with an electoral gloss that gives the impression that Greece’s sovereignty has somehow been spared. Subjugation, in other words, will continue. The financial occupation of Greece must, after all, be managed.

Posted in GreeceComments Off on Managing the Occupation: Syriza Wins Again, … on Behalf of the Banksters

Greece — The One Biggest Lie You Are Being Told By The Media

NOVANEWS
Global Research
No to blackmail and austerity

First published in July 2015

By Truth and Satire

Every single mainstream media has the following narrative for the economic crisis in Greece: the government spent too much money and went broke; the generous banks gave them money, but Greece still can’t pay the bills because it mismanaged the money that was given. It sounds quite reasonable, right?

Except that it is a big fat lie … not only about Greece, but about other European countries such as Spain, Portugal, Italy and Ireland who are all experiencing various degrees of austerity. It was also the same big, fat lie that was used by banks and corporations to exploit many Latin American, Asian and African countries for many decades.

Greece did not fail on its own. It was made to fail.

In summary, the banks wrecked the Greek government, and then deliberately pushed it into unsustainable debt … while revenue-generating public assets were sold off to oligarchs and international corporations. The rest of the article is about how and why.

If you are a fan of mafia movies, you know how the mafia would take over a popular restaurant. First, they would do something to disrupt the business – stage a murder at the restaurant or start a fire. When the business starts to suffer, the Godfather would generously offer some money as a token of friendship. In return, Greasy Thumb takes over the restaurant’s accounting, Big Joey is put in charge of procurement, and so on. Needless to say, it’s a journey down a spiral of misery for the owner who will soon be broke and, if lucky, alive.

Now, let’s map the mafia story to international finance in four stages.

Stage 1: The first and foremost reason that Greece got into trouble was the “Great Financial Crisis” of 2008 that was the brainchild of Wall Street and international bankers. If you remember, banks came up with an awesome idea of giving subprime mortgages to anyone who can fog a mirror. They then packaged up all these ticking financial bombs and sold them as “mortgage-backed securities” for a huge profit to various financial entities in countries around the world.

A big enabler of this criminal activity was another branch of the banking system, the group of rating agencies – S&P, Fitch and Moody’s – who gave stellar ratings to these destined-to-fail financial products. Unscrupulous politicians such as Tony Blair joined Goldman Sachs and peddled these dangerous securities to pension funds and municipalities and countries around Europe. Banks and Wall Street gurus made hundreds of billions of dollars in this scheme.

But this was just Stage 1 of their enormous scam. There was much more profit to be made in the next three stages!

Stage 2 is when the financial time bombs exploded. Commercial and investment banks around the world started collapsing in a matter of weeks. Governments at local and regional level saw their investments and assets evaporate. Chaos everywhere!

Vultures like Goldman Sachs and other big banks profited enormously in three ways: one, they could buy other banks such as Lehman brothers and Washington Mutual for pennies on the dollar. Second, more heinously, Goldman Sachs and insiders such as John Paulson (who recently donated $400 million to Harvard) had made bets that these securities would blow up. Paulson made billions, and the media celebrated his acumen. (For an analogy, imagine the terrorists betting on 9/11 and profiting from it.) Third, to scrub salt in the wound, the big banks demanded a bailout from the very citizens whose lives the bankers had ruined! Bankers have chutzpah. In the U.S., they got hundreds of billions of dollars from the taxpayers and trillions from the Federal Reserve Bank which is nothing but a front group for the bankers.

In Greece, the domestic banks got more than $30 billion of bailout from the Greek people. Let that sink in for a moment – the supposedly irresponsible Greek government had to bail out the hardcore capitalist bankers.

Stage 3 is when the banks force the government to accept massive debts. For a biology metaphor, consider a virus or a bacteria. All of them have unique strategies to weaken the immune system of the host. One of the proven techniques used by the parasitic international bankers is to downgrade the bonds of a country. And that’s exactly what the bankers did, starting at the end of 2009. This immediately makes the interest rates (“yields”) on the bonds go up, making it more and more expensive for the country to borrow money or even just roll over the existing bonds.

From 2009 to mid 2010, the yields on 10-year Greek bonds almost tripled! This cruel financial assault brought the Greek government to its knees, and the banksters won their first debt deal of a whopping 110 billion Euros.

The banks also control the politics of nations. In 2011, when the Greek prime minister refused to accept a second massive bailout, the banks forced him out of the office and immediately replaced him with the Vice President of ECB (European Central Bank)! No elections needed. Screw democracy. And what would this new guy do? Sign on the dotted line of every paperwork that the bankers bring in.

(By the way, the very next day, the exact same thing happened in Italy where the Prime Minister resigned, only to be replaced by a banker/economist puppet. Ten days later, Spain had a premature election where a “technocrat” banker puppet won the election).

The puppet masters had the best month ever in November 2011.

Few months later, in 2012, the exact bond market manipulation was used when the banksters turned up the Greek bonds’ yields to 50%!!! This financial terrorism immediately had the desired effect: The Greek parliament agreed to a second massive bailout, even larger than the first one.

Now, here is another fact that most people don’t understand. The loans are not just simple loans like you would get from a credit card or a bank. These loans come with very special strings attached that demand privatization of a country’s assets. If you have seen Godfather III, you would remember Hyman Roth, the investor who was carving up Cuba among his friends. Replace Hyman Roth with Goldman Sachs or IMF (International Monetary Fund) or ECB, and you get the picture.

Stage 4: Now, the rape and humiliation of a nation begin. For the debt that was forced upon them, Greece had to sell many of its profitable assets to oligarchs and international corporations. And privatizations are ruthless, involving everything and anything that is profitable. In Greece, privatization included water, electricity, post offices, airport services, national banks, telecommunication, port authorities (which is huge in a country that is a world leader in shipping) etc.

In addition to that, the banker tyrants also get to dictate every single line item in the government’s budget. Want to cut military spending? NO! Want to raise tax on the oligarchs or big corporations? NO! Such micro-management is non-existent in any other creditor-debtor relationship.

So what happens after privatization and despotism under bankers? Of course, the government’s revenue goes down and the debt increases further. How do you “fix” that? Of course, cut spending! Lay off public workers, cut minimum wage, cut pensions (same as our social security), cut public services, and raise taxes on things that would affect the 99% but not the 1%. For example, pension has been cut in half and sales tax increase to more than 20%. All these measures have resulted in Greece going through a financial calamity that is worse than the Great Depression of the U.S. in the 1930s.

Of course, the ever-manipulative bankers demand immediate privatization of all media which means that the country now gets photogenic TV anchors who spew propaganda every day and tell the people that crooked and greedy banksters are saviors; and slavery under austerity is so much better than the alternative.

If every Greek person had known the truth about austerity, they wouldn’t have fallen for this. Same goes for Spain, Italy, Portugal, Ireland and other countries going through austerity.The sad aspect of all this is that these are not unique strategies. Since World War II, these predatory practices have been used countless times by the IMF and the World Bank in Latin America, Asia, and Africa.

This is the essence of the New World Order — a world owned by a handful of corporations and banks.

So, it’s time for the wonderful people of Greece to rise up like Zeus and say NO (“OXI” in Greece) to the greedy puppet masters, unpatriotic oligarchs, parasitic bankers and corrupt politicians.

Dear Greece, know that the world is praying for you. Vote NO to austerity. Say YES to freedom, independence, self-government, and democracy. Yes, democracy, the word that was invented by YOU!

P.S. (You can also watch this video where John Perkins – author of “Confessions of an Economic Hit Man” – talks about exploitation of Latin American and Asian countries using the same tools of debt-austerity-privatization. He used to do this for a living!  

Copyright Truth and Satire, 2015

 

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Business As Usual Triumphs in Greek Election

NOVANEWS
Global Research
greek-flag

It’s all over but the postmortems. Western bankers, large investors and other corporate interests triumphed on Sunday as expected – over fairness, equity and justice.

Greece remains Troika occupied territory, its sovereignty and soul lost, its people assured of greater suffering than already, its economy strip-mined for profit, its deplorable status the future of Europe and America, headed toward becoming thirdworldized ruler-serf societies unfit to live in.

SRYIZA retained power by a larger than expected margin – with nearly all votes counted, achieving a 7.4% margin over New Democracy (35.5% to 28.1%).

It’ll hold 145 seats in the 300 member parliament, majority control easily within reach with a coalition partner, likely Independent Greeks like before, expected to be announced on Monday or early in the week.

The Wall Street Journal said SRYIZA’s victory “confounded opinion polls (suggesting) a much closer race, and possibly even a defeat for Mr. Tsipras’ party.”

A record low turnout at less than 55% showed popular disgust with business as usual. SRYIZA effectively got 20% support from the electorate, far from a mandate, a stinging disapproval, showing popular opposition to its policies.

Alexis Tsipras lied claiming otherwise, saying “(t)he Greek people have given us a clear mandate to discard whatever kept us stuck in the past. It’s a crystal clear mandate to escape from the old, corrupt establishment that governed this country for so many years.”

He’s part of the same ugly system – pro-business, anti-populist, pretending to be otherwise, committed to harsher austerity than his predecessors, dismissive of millions of suffering Greeks, their needs and rights ignored so bankers and other corporate predators can profit from their misery.

Eurogroup president/Dutch finance minister Jeroen Dijsselbloem congratulated Tsipras, saying:

I now look forward to the swift formation of a new government with a strong mandate to continue the reform process in Greece. I stand ready to work closely with the Greek authorities and to continue accompanying Greece in its ambitious reform efforts.

The Financial Times explained, saying “(h)is first task as re-elected prime minister will be to implement more tough austerity measures demanded by creditors in return for a new €86bn rescue package.”

Breakaway SYRIZA Popular Unity party won a scant 2.8% support – below the required 3% threshold for seats in parliament. Its representation is as follows:

SRYIZA – 145 seats (five short of a majority)

New Democracy – 75 seats

Neo-Nazi Golden Dawn – 18 seats

Pasok – 17

KKE (the Greek communist party) – 15

Potami – 11

Independent Greeks (Anel) – 10

Union of Centrists – 9

On Monday, Greek media said SRYIZA and Independent Greeks will form a new government “as early as Mondayafternoon or Tuesday morning” – giving him a slim, potentially unstable, 155 seat majority.

Former SRYIZA finance minister Yanis Varoufakis calledSunday’s electoral results “the ‘legalization’ of the capitulation that followed the signing of the dead end, humiliating and irrational” bailout deal – unconditional surrender to Troika demands, spurning strong anti-austerity sentiment.

Dystopian harshness in Greece is a window on the future. We’re all Greeks now!

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“The Greek Tragedy Is A Textbook Debt Deflation”

NOVANEWS

The Matterhorn Interview with Michael Bernegger

Global Research
The Corrupt Practices of Financial Manipulation: The Meaning of the Greek Economic Crisis

Podcast interview: (32 mins)

Prior to yesterday’s Fed anti-deflation policy stance Lars Schall talked with Swiss financial analyst Michael Bernegger in an exclusive interview for Matterhorn Asset Management, about his paper “The Greek Tragedy and its solution“ that offers a counter-consensus analysis of Greece’s economic crisis.

Another topic in their discussion is the growing economic challenges for China.

 

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Syriza Before and After the Elections: To Fight Another Day

NOVANEWS
Global Research

Michalis Spourdalakis interviewed by Pavlos Klavdianos

Pavlos Klavdianos (PK): Will the elections bring about changes in the balance of power and on the political system?

Michalis Spourdalakis (MS): The historical victory of the Left in January marked a change in the system of political representation which outlines a new dynamic for the political forces. However, the way in which this victory was achieved and the difficulties that the first government of the left faced, led after the referendum of the 5 of July, to a big fallback, a big defeat. This defeat needs to be understood as a turning point in a long and large war for the victory of the left in the struggle for the control of state power. The government did not handle this well, it must be said, through the collective processes of the party, which resulted in totally justified emotional responses, mainly disappointment, and which in turn has created a general climate of disappointment and therefore centrifugal tendencies. It was a withdrawal and/or a defeat which however was not the result of a betrayal of a selfish or sneaky leadership. In my opinion, it was a manoeuvre in front of incredibly more powerful forces, in order to save strength and the ability to continue the war in the future. It is very important to see it in this way and not like an accomplishment the government is content with or even in terms of the simplistic logic that it now accepts the notion that there is no alternative.

Syriza and Society

BS: There is stern criticism being voiced against Syriza for calling this election.

MS: Syriza won the elections by promising a very specific program (the Salonica program), was forced to back down and so they are turning to the people for a decision, with a new political strategic proposal. There is of course the parliamentary dimension (loss of the majority), but this was not the defining factor. Syriza is guided by a different logic. It was founded and was developed on the basis of the promise that it would “bring society to the stage.” It also promised to do this with its action at the social level… it would go to the social movements, learn from them, and would form a government that would take into account not just the technocratic hierarchies but also the experience gained from the social movements. Moreover, for Syriza the prerequisite for this strategy was based on the call for the unity of the Left. This was its strategy when it said that it is not interested whether someone was coming from one or the other ideological or party background or movement and spoke of the “whole of the Left” in pluralistic way.

So, Syriza with its action on a social level and with its program which is based on this action attempted to engage the institutions [aka the Troika: European Commission, the International Monetary Fund and the European Central Bank]. It stands therefore with one leg in the society and the social movements and the other in a serious, systemic presence in the institutions: in the parliament, in the peripheral and municipal level and also in the unions, the co-ops, the various citizens’ movements etc. With these prerequisites, it gained the “right” to govern, to manage the state power, in a different logic from which had been imposed in the post-Junta years.

BS: It is difficult to be convinced that it honors the logic you presented. Isn’t this suggested by its fall in the polls?

MS: This weakness stems from the fact that Syriza reached 27 per cent in 2012, through the logic I described, but I fear that even the top cadre of the party, who had helped shape and were operating under this logic, had not fully understood the significance of this strategy. No theoretical or education work to ensure the consolidation of “the Syriza way” was conducted.

Thus, after 2012, Syriza gradually slid into somewhat “governmental” practices and hurried to ascend to power, “at all costs.” It gave much emphasis to the parliamentary game and the action in the social field seemed a routine. It ceased to take initiatives in the society, be inventive as it was in 2010 or 2011. This became apparent in the 2012 convention and even more clear in the 2013 founding conference where the issues discussed were mainly procedural in nature,  apparently isolated from the social field, concerned with only “party organizational matters.” Without any inspiration and creativity, the organization was unable to maintain and support this strategy of Syriza, which up until the 2012 election was more pure and fresh.

Absolute Naivety

BS: But there was popular pressure for Syriza to govern.

MS: The critical assessment we make, cannot simply be attributed to the deficit of the choices of leadership but is a response to real pressures and necessities, arising from the social dynamics and political necessity. It was a “mobilization” of Syriza from the popular classes, which required it to govern. So, the organizational problems of Syriza were not addressed, the necessary adjustments to the new situation were not made, which would require a better consolidation of the party’s strategy.

At the same time, there have been a series of naiveties, having to do with the action of Syriza within the country and the perception of the international environment. There is a perception that if we went to Europe and voiced our view in a well-documented and clear way, this will be heard and the “institutions” would subside. “Institutions” which, however, are filled by neoliberal logic and express very hard and inflexible interests. This was a huge naivety, which decisively influenced the negotiation. In respect to Greece itself, the major naivety had to do with the party. Since the electoral influence was expanding, the leadership implicitly seems to think that a vibrant, democratic, participatory party was not all that necessary. The theoretical work was ignored and the notion was if you take the government that will be enough to allow you to gradually change the domestic balance of power. The naivety of that view, was based on an instrumental conception of power and the state, led the government to tolerate key figures in public administration serving other goals or even appoint technocrats, who clearly had a different make-up and skill-set than the ones required to serve the social alliances with Syriza.

The social alliance that made Syriza comprises not only of the lower social classes (workers, precarious workers, the unemployed, etc.) but also the so-called petty bourgeoisie traditional class (shopkeepers, small traders, etc.), crushed under the austerity policies, as well as the new petty bourgeoisie (self-employed, the urban educated strata and so on). This is the alliance Syriza should have in mind and to strengthen, however slowly, with structural reforms to change the balance of power, despite the adverse conditions, and so to open roads for a broader social transformation.

BS: The idea that when we take the government everything will be done, it was a blatantly instrumental view.

MS: Exactly! Despite the theoretical achievements of the radical, “regenerative” left, standing against instrumental logic, the Syriza government did not follow this. It showed an absolute naivety. Thus the government ran into a wall. The left government proved more inefficient than what you expect, so the criticism is, I think correctly, stating that beyond the limitations of the memorandum, in other areas where it does not touch, the government was not as effective as it had to be.

BS: Do you think that the current difficulty of Syriza to rally, in the elections, its influence on January 25, and its new earned influence even despite the onerous agreement, has its roots in the post-2012 period?

MS: From 2012 onward, I think Syriza became more “governmental,” even before getting the government. It forgot, somehow, what had brought it to the fore, the protagonist of the developments in the country and in Europe, the alter-globalization democratic movement. However, after the retreat this July, the following risk presented itself: the management of that defeat would have heavier political effects than just those resulting from the continuing economic repression it required. First, it did not happen through the collective proceedings of the party, although many excuses given for this were to some extent understandable. It is, however, wrong to claim that the party had become a pro-memorandum, a pro-austerity one. Syriza is not that. We had a government, “with Syriza being its backbone” which in the face of “the EU coup” – we have to say this – was forced to retreat. This party was constructed and strengthened in a completely different orientation, as I explained earlier, drawing strength from distress and resistance struggles against austerity over the last five years.

BS: On what basis, then, can a political recovery be achieved?

MS: First of all, Syriza should reaffirm its pluralism, in terms of radical, regenerative Left. The party’s and the subsequent government’s character, has to take some lessons from the seven months’ tenure. Secondly, the people selected will have to mark this achievement. Thirdly, we need to appreciate the importance that the government has in managing the state. One cannot say “oh, it’s too difficult, I will leave the management of the state.” That is because the state resources are key for the left to strengthen the subordinate classes and change institutions and relations, from state centered to societal centered. Instead, it must manage them in an innovative way, especially under the restrictions put in place by the new agreement.

Something else that must be done, and I think Syriza does it to an extent, is put higher in its agenda the importance of renegotiation of the debt and to be connected with an investment program in the social sector. This will not only alleviate the difficulties imposed by this agreement in the social field, but will also at least give a vision, a positive look to the immediate future of subordinate classes. To promote its contribution to the new strategy, a new vision that we should give to Greek society is key in order to revive the hope that Syriza represented. We also need to overcome the not very democratic functioning of Syriza. The party should quickly proceed to a conference designed to mend the bridges with those who were disappointed, tired, totally justifiably, given how much Syriza had inspired so many.

BS: Syriza is a socially oriented political force; this is clear and those who believe that this was lost because of the forced agreement are wrong. However, there are two elements in its theoretical equipment that suffer, had not been assimilated and, unfortunately, we are going to need them now very much. The first one is that Syriza is not only an anti-memorandum party, but also a left one, which results in its having a great range of action, especially in the Greek society. The second one is the purpose – especially the ability to materialize it – of the transformation of the Greek society and economy. What has been revealed about Syriza’s deficiencies in terms of these characteristics is what this discussion is trying to underline.

MS: And this is the reason why I insisted on the need to renew, to retrieve, to recapture, to realize and systematize Syriza’s strategy. For a long time now, it has become clear that we needed to cast the anti-memorandum character off and insist that we are against austerity entirely and the internal devaluation that goes with it, and this requires that we must become actually anti-neoliberal today and, finally, somehow anti-capitalist. This has not been done and it must get done now; to be creative not only in fields that are not affected by the memorandum, but also in fields that are affected by the memorandum.

This tactic gives us another power, another perspective, knowing – and saying – that this is not the maximum that we want to manage, but that along with the debt reduction, recommit ourselves to the democratic goals we need to realize in terms of transparency, fighting corruption, upgrading local government, democratizing public administration, stopping tax evasion etc., all of which would substantially undermine the reproductive core of Greek capitalism. After all, corruption, or what is called here “interlocking,” is actually key for the reproduction of Greek capitalism, so it is not just a moral or merely a legal issue. The new strategic discussion required for this will need to be a long one, because such a transformation plan needs to involve all the forces of the party, and it should be recalled that Alexis Tsipras, even at the Central Committee meeting after “the coup” himself said that we want to start the procedures for the general social transformation. But for this to happen, all these strategic elements need to be discussed, and in a way that is always moving toward their verification.

BS: The problem we are discussing relates to one of the root causes of the split, in the sense of the non-consolidation of this strategy or maybe also of its non-acceptance by those comrades who formed Popular Unity (LA.E.)

MS: I would like to remind people that the majority of Syriza’s former members who are now connected with Popular Unity have also had an instrumentalist perception of the state, which the majority of Syriza itself does not espouse. Moreover, what Syriza used to say in its formal texts about social control was not absolutely understood by that tendency which is now Popular Unity, and which always gave great emphasis on state control. The understanding of socialism in terms of social control not state control is one of the key achievements of today’s radical and regenerative left which, as it seems, this tendency did not share. A third element is that this tendency could not fully understand the importance of solidarity networks and social movements and actually concluded in a refusal to participate. There was confusion, because it was thought that solidarity is charity.

What this reflects is that words in the party program had different meaning for different tendencies in the party, which led to many misunderstandings, but there were no procedures for real theoretical and political debate and discussion.

What this reflects is that words in the party program had different meaning for different tendencies in the party, which led to many misunderstandings, but there were no procedures for real theoretical and political debate and discussion. The “federal” nature of the tendencies in the party did not help; they functioned more or less as small or larger networks and even as movements or parties within the party, so that almost no common understanding was allowed. It was thought that through decisions from above, minorities and majorities in the founding Congress, things could be addressed. This is a tedious job, which requires a functional, living party, the organization of which will support the strategy of Syriza and that organizationally will be what is really the “new” about the “Syriza way.” The lack of this must be attributed, to some extent, to the split in the party that has now occurred and which costs so much energy, efficiency and votes.

Let me add one more thing. No one takes initiatives, which either force some people to the exit, or undermine the management of the state from the left, unless you have an instrumental conception of power. That is to say a perception that if I am in the government, I will make it. Or counter to that, that I cannot stay in government since I can readily implement the whole of my political project and so I retire. So, these two aspects have met at the same place. Can you criticize from either side of the management of the state and power, if you haven’t grounded what you want to do in the real social and political balance of power not only in our country but also in Europe?

We know from the history of the Left that no social transformation could happen in a single country, let alone today with the processes of global capitalist integration, and which also institutionally now due to the EU relates to the hard core of capitalist dynamics. You do not give up, however, the government for that reason. We shall retake the thread and through a “Syriza’s way” build the party, as we built it gradually since 2006, even without full knowledge of what we were up to. Anything else will be a tacit acceptance of post-democratic currents, that does not want collectivities, but sees management policy, more or less along the lines in which businesses operate. Instead, I believe that there are still resources in Syriza which if properly exploited will not only lead it to recover but will guarantee a real take off. Laying the ground for this positive outlook might be the best outcome of the election. •

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The New Colonialism: Greece and Ukraine

NOVANEWS

by JACK RASMUS

A new form of colonialism is emerging in Europe.  Not colonialism imposed by military conquest and occupation, as in the 19th century. Not even the more efficient form of economic colonialism pioneered by the U.S. in the post-1945 period, where the costs of direct administration and military occupation were replaced with compliant local elites allowed to share in the wealth extracted in exchange for being allowed to rule on behalf of the colonizers.

In the 21st century, it is “colonialism by means of financial asset transfer.” It is colony wealth extraction by colonizing country managers, assigned to directly administer the processes in the colony by which financial assets are to be transferred. This new form of colonialism by direct management plus financial wealth transfer is now emerging in Greece and Ukraine.

Behind the appearance of the recent Greek debt deal is the reality of European bankers and their institutions — the European Commission, European Central Bank, IMF, and European Stability Mechanism (ESM) — who will soon assume direct management of the operation of the  economy, according to the Memorandum of Understanding, MoU, signed August 14, 2015, by Greece and the Troika. The MoU spells out direct management in various ways. In the case of Ukraine, it is even more direct. U.S. and European shadow bankers were installed by U.S.-Europe last December 2014 as Ukraine’s finance and economic ministers. They have been directly managing Ukraine’s economy on a day to day basis ever since.

The new colonialism as financial asset transfer takes several practical forms: as wealth transfer in the form of interest payments on ever rising debt, in firesales of government assets sold directly to the colonizer’s investors and bankers, and in the de facto takeover the colony’s banking system and bank assets in order to transfer wealth to shareholders of the colonizing country’s private bankers and investors.

The Case of Greece             

The recent third debt deal signed August 14, 2015, between Greece and the Troika of European economic institutions adds another $98 billion to Greece’s debt, raising Greece’s total debt to more than $400 billion. Nearly all the $98 billion is earmarked for debt payments and to recapitalize the Greek banks. Wealth is extracted in the form of Greeks producing more, or cutting spending and raising taxes more, in order to create what’s called a primary surplus from which interest and principal is to be paid.

The Greeks aren’t going to have their goods produced and sold cheaper to Germany to re-export at higher price and profit — i.e. 19th century colonialism. Multinational corporations aren’t going to relocate to Greece so they can pay cheaper wages, lower costs, and then re-export to the rest of the world for profit — i.e. U.S. late 20th century colonialism. The Greeks are going to work harder and for less in order to generate a surplus that will return to the Troika institutions in the form of interest payments on the ever-rising debt they owe. The Troika are the intermediaries, the debt collectors, the State-Agency representatives of bankers and investors on behalf of whom they collect the debt payments. They are supra-state bodies and the new agents of financial wealth extraction and transfer.

The Greek-Troika MoU defines in detail the direct management as well as what and how the wealth will be extracted and transferred. The MoU begins by stating explicitly that no legislation or other action,  however minor, by Greece’s political institutions can be taken without prior approval of the Troika. The Troika thus has veto power over virtually all policy measures in Greece, all legislative or executive agency decisions, and by all levels of government.

Furthermore, Greece will no longer have a fiscal policy. The Troika will define the budget. It will oversee the writing of a budget. The MoU calls for a total restructuring of Greek taxes and spending that must occur in the new budget. Greece gets to write its budget, but only if that budget is the budget the Troika wants. And Troika representatives will monitor compliance to ensure that Greece adheres to the Troika’s budget. Every Greek agency and every Greek Parliament legislative committee will thus have its ‘Troika Commissar’ looking over its shoulder on an almost daily basis.

The MoU states the Troika also has the power to appoint “independent consultants” to the Boards of Greeks banks. Many old bank board members will be removed. Troika appointees will now manage the Greek banks on a day to day basis, in other words. Greek bank subsidiaries and branches outside Greece will be “privatized,” i.e. sold off to other Euro banks. The Greek banks are thus now Greek in name only. They will become appendages and de facto subsidiaries of northern Euro banks working behind the veil of the Troika and at the shoulder of their Greek banker counterparts.The several tens of billions of dollars allocated to recapitalize the Greek banks will reside in Luxembourg banks, not in Greece. Greece no longer has a monetary policy; the Troika has.

The World Bank will redesign the Greek welfare system and a new social safety net system. New appointees to run the Labor Ministry, after approved by the Troika, will “rationalize the education system” (i.e. teacher layoffs and wage cuts). The new, Troika vetted Labor Minister will implement the proposals of Troika “independent consultants” to limit “industrial actions” (i.e. strikes) and collective bargaining  and will, following consultants’ recommendations, institute new rules for collective dismissals (i.e. mass layoffs).  Pensions will be cut, retirement ages raised, workers’ health care contributions increased, Local governments made more efficient (layoffs, wage cuts), and the entire legal system overhauled.

The $50 billion Privatization of Greek Government Assets Fund will remain in Greece. However, it will operate “under the supervision of the relevant European institutions,” according to the MOU. The Troika will decide what is to be privatized and sold at what (firesale) price to which of its favored investors.  In the meantime, privatization sales in progress or identified will be accelerated.

The Case of Ukraine           

In Ukraine’s case, only once U.S. and Euro bankers were installed as Ministers of Finance and Economics last December 2014, were more loans promised to Ukraine. The U.S. and EU put in another $4 billion in January, and the IMF quickly announced the new $40 billion deal in February. After the $40 billion, Ukraine’s debt rose from $12 billion in 2007 to $100 billion in 2015. The new $100 billion debt will mean a massive increase in financial wealth extraction in the form of interest payments on that $100 billion.

Another form of transfer will occur in the accelerating of privatizations. No fewer than 342 former government enterprise companies are slated for sale in 2015, including power plants, mines, 13 ports, and even farms.  The sales will likely occur at firesale prices, benefiting U.S. and European “friends” of the new US and European ministers.  So too will the sale of Ukraine private companies approved by the new Ministers. One of every five are technically bankrupt and unable to refinance $10 billion in corporate junk bond debt. Many will default, the best scooped up by U.S. and EU shadow bankers and multinational corporations. What both Greece and Ukraine represent is the development of new more direct management of wealth extraction, and the transfer of that wealth in the form of financial assets.  In past government debt bailouts, the IMF and other institutions set parameters for what the bailed out country must do. But the country was left to carry out the plan. No longer. It’s now direct management to ensure the colony does not balk or delay on the transfer of financial assets enabled by ever rising debt.

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Whitewashing the IMF’s Destructive Role in Greece

NOVANEWS

Image result for IMF LOGO

By Michael Hudson

This autumn may see anti-austerity coalitions gain power in Portugal, Spain and Italy, while Marine le Pen’s National Front in France presses for outright withdrawal from the eurozone. These countries face a common problem: how to resist the economic devastation that the European Central Bank (ECB), European Council and IMF “troika” has inflicted on Greece and is now intending to do the same to southern Europe.

To resist the depression and debt deflation that the troika seeks to deepen, one needs to bear in mind the dynamics that make the IMF un-reformable. Its destructive role in Greece provides an object lesson for how southern Europe must shun its horde of ideologues, as Third World countries learned to avoid it by May 2013, the year that Turkey capped the world’s extrication from IMF “advice.” Already in 2008, Turkey’s prime minister Recep Tayyip Erdogan announced: “We cannot darken our future by bowing to the wishes of the IMF.”[1] Greek voters have now said the same thing.

To soften resistance to the IMF’s austerity demands, a public relations drive is being mounted to rehabilitate the myth that the Fund can act as an honest broker mediating between anti-labor finance ministers and the PIIGS – Portugal, Italy, Ireland, Greece and Spain. On Friday, August 28, three Reuters reporters published a long “think piece” trying to show that the IMF is changing and that its head, Christine Lagarde, has seen the light and seeks to promote real debt relief.[2]

The timing of this report seems significant. The IMF got “back in business” in 2010 when its head, Dominique Strauss-Kahn, overrode its staff and many Board members in order to join the troika and shift the country’s bad debt from French and German bankers onto the Greek people. That is the story I tell in Killing the Host, which CounterPunch published in an e-version last week. (The hard-print and Kindle versions are now available on Amazon.)

President Obama and Treasury Secretary Tim Geithner insisted that Angela Merkel and French President Sarkozy pressure the IMF to go against the opposition of its own staff and 2KillingTheHost_Cover_rulejoin the European Central Bank’s hardline demands that Greece impose austerity. Geithner and Obama warned that if Greek bondholders were not paid in full, some giant U.S. banks would lose heavily on the default insurance contracts and derivatives they had written, and their losses could spread “contagion” to Europe.

It was at this 2011 G8 meeting that Merkel told Greek PM Andreas Papandreou that he had to cancel his proposed referendum on whether Greece should surrender to austerity to help foreign bondholders. As the late Frankfurt Allgemeine Zeitung editor Frank Schirrmacher observed at the time, this meant that “Democracy is Junk.”

Papandreou’s acquiescence led his PASOK party to be swept utterly away, having lost all credibility – the same credibility that the IMF has lost. Papandreou was replaced by a pro-bank puppet. Italy’s Prime Minister suffered the same fate later that week, in a continent-wide crisis turning the eurozone into an economic dead zone.

It took until last July, four years later, for Greek voters finally to be given their say in a referendum. And just as Merkel, Sarkozy and Obama feared, they voted by an overwhelming 61 percent (a 3:2 margin) to reject austerity.

The Reuters piece quotes the same complaints by IMF insiders that my book records – as if this is a revelation that has just came out in their “examination of previously unreported IMF board minutes.” Actually, the information has been out for a year. So the question is, why is this information being reported as if it were new?

The aim seems to be to distract attention from the political dynamics that actually were going on and the conflicts of interest that were at work – and still are. In addition to my own book published last week, former Greek finance minister Yanis Varoufakis has gone public with his own sad experience with Lagarde and the European Central Bank (ECB) demanding further austerity and mass privatizations.[3] “If you were a fly on the wall watching our negotiations,” he reports, “you would see as well as I saw that Ms Lagarde, Mr Draghi, Mr Juncker, certainly Dr Schäuble, were interested in one thing: In dictating to us ‘terms of surrender’. Terms that put an end to the Athens Spring.”

By comparison, the Reuters whitewash distorts history, dumbing it down and censoring the U.S. role of Obama and Geithner, while trying to depict Christine Lagarde as urging an alleviation of Greek debt and austerity.

The world needs to know the whole story, because it will show the degree to which the IMF is under the thumb of Wall Street and European banks, and of U.S. political leaders backing hardline creditor interests. This in turn shows the impossibility of reforming the IMF (or World Bank, whose presidents traditionally are drawn from the U.S. Defense Department or its Cold War supporters).

Killing the Host discloses complaints leaked by angry IMF officials who became whistleblowers and published their complaints at Canada’s prestigious Center for International Governance Innovation (CIGI). These same quotes were just cited breathlessly by Reuters. What the wire service did not report was the point that the IMF’s former economists made.

Lagarde continues to insist that Greek debts can be paid by “extend and pretend,” lowering the interest rate and stretching out the maturities. This is her definition of “writing down Greek debts.” Most peoples’ definition would mean writing down the debt principal. Reading Reuters’ selective quotes, it is almost as if the seemingly detailed report was written to counter the political points Varoufakis, I and others have been making.

What Reuters excluded from its report that provides the key to unlock what is most politically embarrassing: The behavior of Obama and Geithner in protecting Wall Street’s casino bets that Greece could be arm-twisted to pay. Dominique Strauss-Kahn had two conflicts of interest: He wanted to run for the presidency of France, gaining favor by protecting French banks; and he wanted to get the IMF back into the austerity advice business, by joining the Eurozone troika. When Christine Lagarde started to repeat his refusal to back the recent IMF staff report endorsing write-down of Greek debt, the staff leaked it this spring, much to her embarrassment when the IMF signed onto a troika program with no real debt relief.[4]

The Reuters report throws up a cloud of disinformation saying that she backs debt relief, as if this means backing a writedown of unpayably high Greek debt. Quite the contrary, Lagarde has said again and again that her idea of debt relief is simply to extend and pretend – to stretch out the maturity of Greece’s debt, to lower the interest rate charged.

The real story is not simply the warnings that Reuters published so breathlessly from IMF staff members and board members that Greece could not pay its debts and that attempting to do so would bring on depression. The real story is why Strauss-Kahn overrode them in 2010. The IMF officials who resigned blamed his action on his political ambitions in French politics and his opportunism in trying to finally get the IMF “back in business” rather than being left out by the ECB for not being sufficiently pro-creditor. To override the fact that the IMF was violating its own directives, the Fund introduced a “contagion” escape clause that nullified the demand that it not endorse loans that could not be paid. (I describe the small print in Killing the Host.)

Lagarde is still adhering to the demand that Greece must repay all the debt principal, including what IMF staff members urged to be written off four years ago. Like Strauss-Kahn, she was about to override her own staff when they leaked their report on Greece’s inability to pay. An indication of her position was her statement at a May 2012 IMF meeting in Riga, where they came to celebrate Latvia’s punishing austerity model that could be exported to “serve as an inspiration for European leaders grappling with the economic crisis.”

The fact that the IMF’s head has to be a French pro-bank, pro-austerity ideologue, taking orders from Washington officials wield veto power on behalf of Wall Street bankers and bondholders, makes the IMF hopelessly compromised. The icing on the cake is its recent loan to Ukraine, money that Ukrainian President Poroshenko has said will be spent to wage war on Russian-speakers in eastern Ukraine where most of the export industry was located.

By no stretch of the imagination can Ukraine pay this debt. It already has negotiated a 20 percent writedown of its debt to private bondholders, and both Poroshenko and “Yats” insist that they will default on their $3 billion debt to Russia’s sovereign wealth fund falling due this December. That alone will require the IMF to withdraw, because the terms of its Articles of Agreement prevent it from lending to countries that unilaterally default on debts owed to official institutions. (The original idea had in mind the United States, not Russia or China.)

Yet the IMF has not warned that Ukraine must either pay or see itself turned into a financial pariah Greek-style. The Fund has been pulled into the New Cold War in addition to the financial war against labor and against government ability to resist austerity.

Past Reuters reports (and those of the New York Times and other neoliberal press) have popularized the trivializing idea that the reason China, Russia and other BRICS countries have created their own alternative development banks and international currency institutions is merely because they don’t have a large enough vote within the IMF. (Congress has blocked new U.S. contributions to the IMF, preventing a renegotiation of quotas.)

This is not what the BRICS countries say. Their disagreement is that the development philosophy of the IMF and World Bank is to promote austerity to pay bondholders and sell off the public domain to U.S. and other foreign financial investors. No matter how large the foreign quota, the U.S. Government retains veto power to enforce these U.S.-centered rules. The BRICS want a different development philosophy, an alternative to austerity economics and IMF “stabilization plans” whose effect is to destabilize countries submitting to their austerity.

The tragic Greek experience should stand as a warning of the need to withdraw from the rules that have turned the eurozone into an economic dead zone, and the IMF and Troika into brutal debt collectors for European, U.S. and British banks and bondholders. This is not a story that the mainstream press is happy to popularize. And as for the academic economists trotted out as talking heads, they still don’t get it.

Notes.

[1] Delphine Strauss, “Turkish politicians argue over need for IMF help as crunch bites,” Financial Times, October 28, 2008.

[2] Lesley Wroughton, Howard Schneider and Dina Kyriakidou, “How the IMF’s misadventure in Greece is changing the fund,” Reuters, Aug. 28, 2015, http://www.reuters.com/investigates/special-report/imf-greece/

[3] Introduction: Our Athens Spring, https://varoufakis.files.wordpress.com/2015/08/frangy-2-23-aug-2015.pdf

[4] Jack Ewing, “I.M.F. Report Shines Uncomfortable Light on Greece’s Financing Gap,” The New York Times, July 15, 2015, and Peter Spiegel and Shawn Donnan, “IMF raises doubts over its bailout role,” Financial Times, July 15, 2015.

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