- Created: Thursday, 12 June 2014 14:58
- Written by Michael MacGregor
Fight Racism! Fight Imperialism! 239 June/July 2014
As we go to press, the results of the first round votes in the 18 May local and regional elections show success for the Coalition of the Radical Left, Syriza. In Athens and its region of Attica (which includes 40% of Greece’s electorate) Syriza candidates are leading, while New Democracy and PASOK candidates, representing the governing coalition, have failed to reach the second round of voting on 25 May. Continuing advances for Syriza in second-round votes and European elections on the same day may create serious instability, given the government’s parliamentary majority is only two.
Syriza presented these elections as an opportunity for the people to reject the austerity agenda of the Greek government, as dictated by the Troika of the European Union, European Central Bank and the International Monetary Fund. In return for massive bailouts, binding agreements were signed – the Memoranda – radically restructuring the economy. Syriza leader Alexis Tsipras has called the election results so far ‘the referendum that was never done in Greece for the loan agreements.’ Those agreements have meant an acute descent into poverty and insecurity for millions of Greeks. Unemployment is the highest in Europe at 28%, with youth unemployment at least 60%; real wages have fallen on average by 25% and the economy has cumulatively contracted by 25% since 2010.
In the 2012 general election Syriza campaigned on a principled position of repudiation of the debt arising from the Troika’s Memoranda. Such an openly rebellious stance brought it near to success. By effectively mobilising millions to vote – the youth, the poor, the unemployed and politically progressive voters across all parties – Syriza powerfully challenged the brutal austerity agenda of the Troika. This positive development shook the Greek ruling class, but did not undermine its determination to attack the working class. Class war has continued to be waged relentlessly by the powerful in defence of their system.
While the Troika is concerned to promote an image of Greece steadily moving toward economic recovery, it has responded to desperate pleas from the Greek government to extend the period of loan repayment to 50 years by stating that it expects full repayment of the €172bn bailout and strict adherence to the Memoranda of the last four years. The Troika insists that Greece remains on course for meeting its ‘agreed goals’. Christine Lagarde, director of the IMF, considers that ‘Greece is heading in the right direction’. April saw the first issue of Greek government bonds since 2010 with €2.5bn-worth offered at 5% interest. The Athens stock exchange has risen 175% since reaching a 22-year low in June 2012. However, other opinions in Germany contend that figures showing a recent rise of 0.6% in GDP were got up to falsely suggest an approaching Greek exit from recession. There is talk of a further bailout of €16-17bn to tide Greece over until 2016.
The Troika released the last €9bn tranche of its latest bailout in early April. As ever, the transaction was only approved after the Greek parliament passed another bill consolidating the position of the Greek working class as a pool of cheap labour for international capital. It furthers the massive deregulation of small businesses such as bakeries, petrol stations and pharmacies. It authorises the sale of more government property to the tune of €500m under the supervision of three European banks. 4,000 workers are to be placed on the notorious ‘mobility schemes’ on two-thirds salary, to be dismissed if no other public sector jobs are found. Mass sackings will inevitably follow, given that 25,000 public sector jobs are due to go this year. New laws will limit workers’ salary increments and benefits for the unemployed. Protest will be controlled by new limitations on the right to strike.
Greek, European and international capital is carefully assessing the sustainability of the Greek economy in the light of these measures and the elections. There are differing views reflecting the instability of the situation: Fairfax Financial Holdings has expressed ‘optimism’ in the Greek economy and is ‘impressed by government efforts to improve conditions in the country’. Local capitalist Andreas Taprantzis, executive director of the Hellenic Republic Asset Development Fund, claims that ‘there has been a huge shift in sentiment... investors are anxious to dig up Greek opportunities’. Citigroup is more cautious in recognising the ‘critical dangers’ of political instability arising from continued austerity – critical, that is, for their profits.
Since Syriza’s popular and electoral rise from 2012, there has been much speculation in the bourgeois media as to its present programme. The markets need to know whether they still face a serious challenge to their interests, given Syriza’s previous threats to tear up the Memoranda and unilaterally cancel the debt. The recent formulations of Syriza suggest a less direct opposition to the sources of austerity and a turn to a left social democratic approach to solving the capitalist crisis at a national and European level. On 6 May, Tsipras called for a ‘European New Deal’ and argued for a ‘coordinated reflation of all the European economies’. He wants to ‘reform the public sector, avoiding the across-the-board cuts ... focusing on targeted interventions’. Most significantly, he is now circumspect about the debt: it is no longer to be cancelled but ‘renegotiated’. The debt is divided into payable ‘good’ debt and unpayable ‘unjust’ debt. A statement in January 2014 from Syriza MP and economist Giorgos Stathakis estimates that only 5% of the debt could be described as ‘unjust’. Tsipras now appeals for the ‘write-off of a large amount of the outstanding debt to make it sustainable’.
Syriza is correct, at least, in recognising the elections as a referendum on the austerity measures, and any advance even in its trimmed programme of reform may cause the New Democracy/PASOK government to fall. In these circumstances the central interests of the working class remain the complete and absolute repudiation of Troika-imposed austerity and debt.