Greece: Austerity makes the poor pay

Fight Racism! Fight Imperialism! 238 April/May 2014

The devastating social consequences of austerity in Greece are plummeting incomes, massive unemployment, malnutrition and disease, with rising levels racism and fascism. A recent survey by the organisation representing Greek small businesses and professionals showed that 95% of all families had suffered from the effects of six successive years of recession. In the face of this, workers and youth have maintained their fight for a decent future. In January police banned demonstrations during the ceremony when Greece took over the EU Presidency. The defiant crowds were beaten and tear gassed. School students have occupied hundreds of schools to protest at lack of heating and teacher redundancies. The police are approaching school heads for names of those involved and arrests and interrogations have followed.

The Greek coalition government is trying to retrieve a delayed vital tranche of money from the Troika of the European Union, the European Central Bank and the International Monetary Fund. The Troika’s methods are sheer gangsterism. Greece was given access to a massive bailout loan of €240bn in 2010 and has received up to now about €200bn, almost exhausting its credit. Payments are dependent on meeting the severe austerity and budgetary targets set by the Troika. From the end of 2013, strains in meeting the Troika’s vicious deadlines were becoming apparent. Government cuts of €3bn were not enough, the Troika was demanding that a further 11,000 government and local jobs be slashed in 2014. A study by the Organisation for European Co-operation and Development identified over 500 business regulations as restrictive: any impediments to capitalism’s rampage have to be abolished.

Opposition to the Troika’s financial throttling has emerged from an unlikely source. Wage cuts imposed on the Greek army and the fascist-infected police force in 2012 were challenged under fair pay regulations in the Greek constitutional court in January. The government argues that funding these wages will mean further cuts in other areas to balance the 2013-14 budget which is already showing a deficit of €4.5bn. Since assuming the EU presidency the government has had to maintain its crackdown on the Golden Dawn fascist movement. This makes it all the more vital to buy the brute loyalty of the armed defenders of a discredited state and economic system.

The Greek state is concerned that further austerity measures will bring uncontrollable instability and undermine all efforts to make the working class pay for the bankers’ crisis. Governing parties will have to oppose Troika demands during municipal and European elections that are due in May if they are not to lose heavily.

At a meeting of European leaders at the end of January there were loud complaints about Greece’s slowness to meet Troika targets. International financial consulting group Eurasia expressed its alarm that the country was ‘slipping on all of its fiscal and structural targets’. German finance minister Wolfgang Schauble insisted that ‘more efforts are required’.

While Germany is considering a meagre direct loan to Greece and its cruder populist newspapers demand the direct sale of Greek islands to raise cash, Greece remains mired in debt. Greek sovereign debt, at €340bn, has grown to 176% of GDP. And while that debt has grown, GDP has fallen by 25% since 2008. So much for the Troika’s assistance.

Average family incomes in Greece have fallen by 40% over the last three years. Spending on the basic necessities of life: food, clothes, heating and transport has fallen for almost all families and individuals. State benefits are only available to one in ten of the two million unemployed. Those benefits entitle the poor to limited access to the failing national health system.

The German organisation Doctors of the World recently found that over 2,000 Greeks are being excluded from that system every day, with 2.3 million people now uninsured for basic health care. This has meant the virtual elimination of free health care for 90% of the unemployed. They have likened the devastation to ‘a war zone’. Spending on hospital care fell by 26% between 2009 and 2011. Troika measures have demanded the savage reorganisation of what remains of health care, the outpatient system has been suspended and wages cut. Redundancies are planned for thousands of administrative and direct care staff. Fees for outpatient visits are set to rise from €3 to €5, while the cost of medicines has also risen. Rates of HIV infection, tuberculosis, suicide, infant mortality and malnutrition have all risen as a consequence of the austerity measures. Truly the poor are paying for the bankers’ crisis.

As the May elections approach there is growing concern that SYRIZA which almost won the 2012 general election on the popular, militant rejection of the austerity measures, is retreating from this defiant stance. Researchers for the US bank JP Morgan have noted recent polls which approve this development and are optimistically courting a new coalition of SYRIZA and New Democracy ‘…to become a credible and responsible government’. Careerists from the last austerity government of PASOK have been selected as candidates for SYRIZA, including Odysseas Voudaris who was a member of the Papandreou government which signed the first Troika agreement. Alexis Tsipras, leader of SYRIZA, stated in early February that: ‘Our position is to try and find a consensus solution’. SYRIZA is now in the active process of re-formulating the debt where it had previously completely repudiated it. One SYRIZA spokesman has described 90% of Greece’s €340bn debt as ‘…traditional, public debt of the markets, in other words bonds. There is no legal process to challenge this.’ New Democracy or SYRIZA, the promoters or apologists of austerity will face judgment.

Michael Macgregor


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