The dictatorship of the Market

29.06.2011 - Atenas - Mariano Quiroga

George Papandreou, the US born Prime Minister of Greece has put together a majority to impose a “rescue” plan and extreme austerity measures on the Greek people. Legislators voted by a majority to accept the 17 billion euros that the European Bank is proposing and that is part of a series of adjustment plans that surround a total loan of up to 100 billion euros if they follow to the letter the dictates of the European Union.

It is calculated that these new debts, added to the current debt of 160% of GDP will lead to indebtedness of several generations and will reach 300% of GDP. In other words Greeks will have to confront a debt three times higher than what the country produces in one year.

The people have rallied to show their discontent at the series of proposed cuts. 138 members of parliament have heard them but it hasn’t been enough and this has unleashed fury in the centre of the Greek capital. In the midst of a 48 hour general strike, a few hundred demonstrators confronted riot police leaving hundreds of injured and dozens of detained.

It should be remembered that Greek politics of repression have been repeated in recent years. A youth uprising following police killings produced strong fighting mainly in Athens and Thessaloniki. Then tense and large demonstrations were led by unions demanding non-payment of foreign debt, the age of retirement not be extended and taxes not be raised; all unpopular measures which have generated an increasing hardship.

As a counterpart to this impotence channelled into violence and aggression towards politicians and the police, several thousand Athenians joined the Spanish Movement of Outraged people wanting to resolve this conflict situation with the government through nonviolence, persistent denunciations and social organisations. The 29th of May as well as the 19th of June have been key dates for this Movement in all the places where it has spread to, but above all in Athens, bringing together 25 thousand people.

We must not confuse general outrage and contained anger with this explosion of impotent violence which does no more than further strengthen repressive state policies. The tear gas launched by the police caused health problems and suffocation in the midst of devastation. The threats of the President of the European Union should not be forgotten when he told Greece, “either you will accept the adjustment plans for good or for bad.”

The adjustment plans include a 25% salary reduction for public employees, a strong increase in taxes, reduced investment in Health, Education and Social Security. A number of grants are abolished at the same time as a programme of privatisation starts, including ports, water companies, airports, banks, mining rights, property, refineries, electricity companies and the state gambling and lottery system. The valuation of these adjustments is more than 70 billion euros. What the plan doesn’t explain is how the income generated for the state by these businesses will be replaced.

The people are responding with anger to this abrasive discourse that benefits the large European banks who will be assured of substantial repayments over 30 years and on top of this the European Union plans to continue selling weapons to the Greek government, one of its best clients. This is the irritating paradox for the Greeks: Europeans lend them money for them to buy weapons and then they have to pay the interest.

Many predict that the country will explode like Argentina did in 2001. The danger is that the luck of the Greeks will also affect other countries in a situation of imminent danger (Ireland, Spain, Italy and Portugal). If these countries are also dragged down, the European Union may have to let go and the Euro, as a currency could be replaced in these countries, causing turmoil in the world economy. The fact that everyone is in the same boat will be no consolation.

Categories: Economics, Europe, International

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