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| International Monetary Fund (Photo credit: Wikipedia) |
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| Board of Governors - International Monetary Fund (IMF) (Photo credit: Wikipedia) |
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| IMF Headquarters, Washington, DC. (Photo credit: Wikipedia) |
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| English: The European Central Bank. Notice a sculpture of the euro sign. (Photo credit: Wikipedia) |
I don’t know anything about economics --- to put it another
way, I agree with the Amory Lovins perception that “economics is a brain
disease” --- but I find the current crisis confronting the left-wing government
of Greece endlessly fascinating, and I have been reading up on everything I can
get my hands on, to try to keep on top of what is happening. However much the guardians of economic
orthodoxy in the Western world chunter on about the sacred duty to repay loans,
nothing can disguise the fact that what they really have in mind is to crush
any credible uprising of left-wing politics within the European Economic
Community, and they have no hesitation about using bully-boy methods to carry
out this aim.
From my point of view, these
arguments about international finance are all about funny money. It is
well-known that for all the aid poured into Africa and Latin America from
Western sources, still those continents repay more every year than they receive
in aid, and they repay it to banks of one kind or another. In other words, the set-up is a monstrous
hypocrisy. This system has been entrenched over the years by such institutions
as the International Monetary Fund and the World Bank, both controlled and
mostly funded by the United States (which today is the world’s leading
oligarchy, whose government seems to be completely in the control of Big
Money), and whose primary purpose seems to
have been to ensure that capitalism governs the affairs of the whole world. In
other words, they don’t lend money unless the receiving countries agree to do
away with such nonsense as nationalized industries, high wages and liveable
pensions. In one country after another,
they have not only tied receiving countries into knots but have in the process ruined
indigenous industry and agriculture and made it simple for Western companies to
flood their markets with lower-priced goods. This is the basic understanding
from which I approach this Greek crisis because it seems to fit the same
parameters as those described.
Any whisper of opposition, as
in Greece, and the country is fast brought to its knees by massive withdrawals
of funds heralding the likelihood of a banking crisis from which the local
government could probably never recover. The terms of the loans granted to
Greece have been that they should follow a rigid programme of economic
austerity, which has immeasurably worsened the condition of the Greek people,
plunging them into massive unemployment
and forcing what is widely described as “a humanitarian crisis.” The troika --- sixty
per cent of Greece’s debt is owed to European Union governments, 10% to
the International Monetary Fund (IMF) and 6% to the European Central Bank
(ECB), which are collectively known as the troika --- have insisted Greece
privatize everything that is publicly owned, reduce wages and pensions, and so
on until the populace is literally on its knees.
“(Since the election) we’ve seen that these European institutions
are not receptive to the kind of political or democratic argument, which says ‘we’re
an elected government with a mandate to carry out, and you’re our central bank,
and we can expect you to do your work and let us do what we were elected to
do,’ ” said Stathis Kouvelakis, a
member of the central committee of Syriza, who
teaches political theory at King’s College, London, during a recent
fascinating analysis of the whole crisis in conversation with a French philosopher
Alan Badiou. The conversation is published in Jacobinmag.com, which describes
itself as “a leading voice of the American left.”
He added: “All left-wing governments in the world who were determined to change
things ended up faced with this kind of obstacle. At the heart of this
question, is (the) decision (of Syriza’s leadership) to break with austerity
within the framework of the European institutions, and, more particularly,
within the terms of the eurozone. This was the basis Syriza was elected on, and
this has been its line throughout the last three years in particular.
“Now
we can say that we’ve seen the limits of this strategy. This is not at all what
it is about. These institutions are there in order to lock in extremely harsh
neoliberal policies, to lock in the troika supervision of entire countries. And
that’s exactly what they’ve set out to do, forcing the Greek government into
making very serious retreats …. Indeed… at this very moment the teams of
troika experts are in Athens scrutinizing Greece’s accounts.”
If this is what it is about,
one would have expected the European leftists to have taken to the streets. For
a time the French unions obliged, with a huge march of support. But the French
so-called Socialist government leader, President Hollande, launched a ferocious
attack on Syriza and its pretensions. This did no more than confirm that the
European leftist parties have become paper tigers, totally overcome by the
neoliberalist cant coming from the big battalions.
A great deal depends on what
kind of an outfit Syriza is. Until fairly recently it was a small party, and
even today, its ministers mostly are drawn from intellectuals, many of them
being professors who have been working away in universities in various
countries until drawn back to their homeland to serve in its hour of need. In
the months before the election, however, a mobilization of the population
occurred that gave the party its momentum to carry it into office, and soon
thereafter the Prime Minister Alexis Tsipras called for more mobilization, more
street action, more study of the situation as a means of building support. The participants in this round table agreed
that the party’s support within Greece today is now higher than it was before
and at the time of their election. So
much will depend on which strain of the party’s membership gains the upper
hand. Faced with similar situations in the recent past, socialist movements within
Europe have come to power talking a good game, but have collapsed at the first
whiff of powder from the bosses in the citadels of economic power.
Badiou made reference to the
Mitterand government as an example. When the name of Mario Draghi, now the
leader of the European Central Bank was mentioned, with a hint that he might be
considering himself as an internationalist in this situation, Kouvelakis
responded very sharply, saying, “I would say that the European Central Bank has nothing to do with
internationalism, I don’t see the slightest hint of internationalism in Mr.
Draghi, and I think internationalism is on the side of those who are now
opposed to (him), his politics, and everything he embodies — including him
personally, physically.” He might well
say so: Mr. Draghi is just another one of the army of banking operatives
trained and employed by the infamous U.S. firm Goldman Sachs, who have been
sent out around the world to make sure that global financial management remains
in the safe hands of the bankers. The ubiquity of these Goldman Sachs guys
really has to be seen to be believed --- they are everywhere, hundreds of them,
making decisions for more governments than anyone would have believed possible,
and when their bank and others got the world into the crisis of 2008, one of
them was appointed as the U.S. government’s point man to steer the way out of
the crisis while preventing the banks from paying for their mistakes and greed.
On the BBC today, the former
leader of the European Central Bank, Jean-Claude Trichet, told his interviewer,
Stephen Sackur, that the argument was not about repayment of loans. That was
subsidiary to the Greek government agreeing to “a credible recovery programme.”
He repeated this numerous times, as if no one could argue with its irrefutable
logic. But Sackur, though he did try to
press the man on a number of issues --- particularly on Greece’s inability to
repay any sum of money, however large or small--- never asked him what was his
definition of “credible.” If he had he
might conceivably have gotten the answer that to be credible a recovery package
would have to bow to the austerity programme insisted on by the troika, as if
it were the Bible.
Syriza was a small party until a few years ago, and would never have
come to power if not for the emergence
of popular mobilization and social movements before the election, which Badiou
described as without a doubt greater in scope than anything seen in Europe since the 1970s.
As against the dictates of this
“masters of the universe” troika, Tsipras in his appeal to the Greek
people following his election asked them to uphold the constitution, and
invoked its final article which specifies that the constitution resides in the
people and their patriotic right to rise
up. When the negotiations showed the
determination of the European elites to be inflexible, Tsipras gave an interview
to a Greek paper, and when asked if he had an alternative, he replied: “Of
course, we have an alternative plan. Greece does not do blackmail, but nor will
we accept blackmail from others. The country has a lot of possible options; of
course we don’t want to reach such an impasse, but . . .”
Kouvelakis added: “So that’s where we are at the moment, in sum. In my
view, there’s no other way…. For Europe’s political elites, and the economic
forces they represent, it’s vital not only to force Syriza into a retreat, but
to humiliate it politically. Such a political humiliation would also be a shot
across the bows of Podemos and all the social and political forces in Europe
that challenge austerity policies: ‘See what happened to the Greeks? That’s
what’s in store for you if you try and do the same.’ ”
Confirmation that the issue is politics, rather than economics, seems to
come from an article in the Wall Street Journal on April 8, entitled “The case for letting Greece go.” The writer points out that the problem is not
“financial contagion”, since more than 80 per cent of the country’s debt is
held by governments or “official creditors” who “could absorb default-related
losses.” Private Eurozone banks last
September were owed just over $18 billion dollars, one-third of the level in
2012, and much of it in short-term or speculative loans, so that the total
today is probably even lower. If that is so what is the problem?
The Wall Street Journal confirms
the answer in straight language: “If creditors
allow Athens to increase government spending while reversing labor-market
liberalization and privatizations, they’ll encourage anti-reform movements
elsewhere. Spain’s left-wing Podemos party has polled well since Syriza’s Greek
victory in January as Spaniards consider whether it might offer an alternative
to painful reforms, and the party won 15 seats in the regional parliament in
Andalusia last month. Ireland’s Sinn Fein is gaining support for its
anti-reform platform…A
serious Greek government would offer to press ahead with privatization and
deregulation in exchange for some leeway to cut tax rates along with government
spending cuts. But Syriza has insisted on a return to something like the status
quo ante, with higher spending, anti-growth tax policies and delays or halts in
deregulation….Accommodating Syriza’s agenda now would be a severe blow to a
eurozone that urgently needs faster growth….”
This is what M. Trichet meant in his BBC interview, no doubt, by “a
credible recovery package”. A veritable gallery of right-wing economic mantras:
Privatizations. Deregulations. Lower taxes. Government spending cuts. The very
policies that landed the world economy in the mess of 2008.
Some choice!
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