Greece: fighting an economic coup d’etat

Pin It

Update 6 July: Greece votes No to austerity

The Greek people have overwhelmingly rejected the austerity agenda of their European creditors. In a 61.31% ‘No’ vote on a turnout of 62.5%, the Greek people convincingly threw out the latest demands of the Troika. The result is an insubordinate two fingers up to the powerful and wealthy which will be welcomed by working class and oppressed peoples everywhere. Given the serious economic and media operation to secure a ‘Yes’ vote, including non-stop lying about the closeness of the vote, the shortness of preparation for the referendum and the fact that under Greek electoral law voting must take place in a voter’s home area, the Greek people are to be applauded for their bold stance against austerity. It is an important victory for all those fighting austerity and imperialism throughout Europe: the attempted economic coup failed.

Greek workers, the youth, the unemployed, the poor and pensioners are saying no more to poverty and insecurity, no more paying for the crisis of the bankers’ system. They will now face an onslaught. While the Washington-based IMF has called for 30% debt relief for Greece, as we write there is uncertainty as to whether the European Central Bank will extend any further liquidity to Greek banks through its European Liquidity Assistance programme. The uncertainty is deliberate and may be the precursor to forcing Greece out of the eurozone. Greece's finance minister Yanis Varoufakis has resigned in order to facilitate new negotiations with the Troika. German Chancellor Angela Merkel has said that there will be no new negotiations. This is not the end of struggle for the Greek working class – it is the beginning. We applaud them and send them full solidarity and pledge to step up our own battle against the heartless financial masters of European imperialism.

Michael MacGregor


‘Finance is a gun. Politics is knowing when to pull the trigger.’ – Mario Puzo, author of The Godfather.

‘We have nothing, no money, we cannot live like this any more. Enough is enough. Everyone must take to the streets now to stop this.’ – Thomas Yanakakis, 63, Greek pensioner.

On Sunday 5 July the Greek people will vote in a referendum either to accept or reject proposals from Greece’s creditors, the Troika (the European Union (EU), the European Central Bank (ECB) and the International Monetary Fund (IMF)), that represent the outcome of six months of so-called negotiations. Announcing the referendum on 26 June, Greek Prime Minister Alexis Tsipras called on voters to reject ‘this blackmail ultimatum’. Class lines have been drawn: the wealthy and better-off section of the middle class will vote ‘Yes’ to unending austerity for the mass of the people; the working class and poor will vote ‘No’ to achieve an end to debt bondage. The Syriza government has weakened its position, first by making significant concessions to the Troika during the negotiations, and second by failing to mobilise its political base among the working class and poor to provide a counter-balance to the pressure from European imperialism.

Syriza has always insisted that Greece could reject austerity and remain within the eurozone. This has been despite the evident fact that Europe and the IMF are waging a war against the Greek people. Their aim is to destroy the Syriza government through a coup of economic forces. On Friday evening, 26 June, the Greek government's negotiators walked away from talks in Brussels. All 26 finance ministers of the EU had convened the day before in summit discussion, preparing to accept the surrender of Syriza. At midnight on 26 June, Yanis Varoufakis, Greek finance minister, unsuccessfully sought a week's extension on the period of an IMF loan repayment of €1.6bn due on 30 June. Greece’s subsequent default was the first ever by an advanced capitalist country. On 1 July Tsipras stated that he was willing to concede to the bulk of the outstanding demands from the Troika on pension cuts and VAT increases if spread over a two-year period, only to be contemptuously dismissed by German Chancellor Merkel who said there could be no further discussions until after the referendum. Her intransigence prevented what could have been Greek capitulation.

One of the earlier compromises offered by Syriza was a proposal to modestly increase taxes on the rich in Greece. This was said to have incensed the wealthy blackmailers of Europe. Breaking their own rules of complete unanimity in agreements and statements, the European finance ministers and commissioners have excluded Varoufakis and Greece and consciously targeted the country for expulsion from the eurozone. Jean Claude Juncker spelled it out in relation to the Greek referendum: ‘It’s the moment of truth … the euro versus the drachma. This is the choice’. Germany, France, Italy and Britain united in defining Sunday’s referendum as a referendum on euro membership. Sigmar Gabriel, German Vice-Chancellor and president of the Social Democratic Party stated that if the Greeks voted ‘No’ on Sunday they were voting ‘against remaining in the euro’. European imperialism is determined to defend the euro whatever the social cost: it is key to its long-term survival in a world of growing inter-imperialist rivalries.

Class lines drawn in referendum

The Scottish referendum on independence in 2014 was an opportunity seized by the 1.6 million overwhelmingly working class ‘Yes’ voters to demonstrate their anger and opposition to the emerging consequences of austerity in Scotland: the explosion in food banks caused by welfare sanctions and low pay. The Greek referendum will also draw class lines, as Greek commentator Maria Margaronis points out. The ‘No’ voters who reject the terms of European imperialism, she says, will comprise the ‘urban and rural poor, the unemployed, those from the middle class who have fallen furthest’. Against them will be ‘…the wealthy people with business or professional links abroad, young graduates and entrepreneurs’. The working class of Greece, the people of Greece, must demonstrate now that it cannot be game-over in this real ‘life or death’ battle, by forcefully rejecting the endless poverty which will be imposed on them by continuing austerity. Capitalism offers the working class no choice but to fight back. The struggle against austerity must be turned into a struggle for socialism.

While accounting for only 2% of the European economy, Greece is being attacked economically for its government’s stance against austerity. German Chancellor Merkel is reputed to have stated in 2010 that Greece '... will get this so the others don't want it.' Merkel was referring to the memorandum signed then between the Troika and the Greek government. This committed Greece to a savage austerity programme, which has brought the country to its knees, in return for loan agreements to bail out the Greek economy worth €240bn, the vast majority of which has gone directly to private banks. The bailout package formally ended on 30 June, the same day as Greece defaulted on its IMF repayment. Totalling €35bn, this was the largest single loan the IMF had ever advanced. It is the odious and unelected Christine Lagarde of the IMF who is directing the cold-blooded banking operation against people she believes are not ‘adults’. From an institution which deliberately created mass hunger and poverty in Africa, Latin America and Asia in the 1980s, through its notorious Structural Adjustment Programmes, such chauvinist attitudes are to be expected. On 2 July, in a statement that exposed the complete failure of the 2010 and 2012 bailouts, the IMF conceded that Greece needs up to €60bn of extra funds over the next three years and large-scale debt relief to create ‘a breathing space’ and stabilise the economy.

Any review of the levels of deprivation in Greece reveals the complete failure of European imperialism’s austerity strategy. As The Guardian’s foreign correspondent Jon Henley points out, the crisis has left ‘… 26% of Greece’s workforce unemployed, 30% of its people below the poverty line, 17% unable to meet their daily food needs and 3.1 million without health insurance…’. To which can be added: the 60% youth unemployment rate, the 11,000 people who have taken their own lives since 2008, the 40% of children who live below the poverty line and the 2.5 million pensioners whose meagre incomes are the principal target of the European bankers. In a large number of cases these pensions are the sole source of cash for whole families. The austerity deal which Chancellor Merkel called ‘…a generous offer’ would only have worsened these conditions.

Economic war and media war

In the protracted meetings between Europe and the Syriza government, a spokesperson for Varoufakis described the eurozone leaders as ‘pathological liars’. This is indeed so, but the bankers’ representatives need a machine that will deliver and support the lies and critical omissions that form opinion and attempt to push the balance overwhelmingly in their favour. In this there is no greater accomplice than the British media. While the liberal Guardian newspaper contributes by describing Greek Prime Minister Alexis Tsipras as ‘abrasive’ and Athens as ‘belligerent’, the Financial Times editorialises Tsipras as ‘dishonourable’. Syriza is mocked as ‘… a mix of delusional fanaticism … a coalition of radicals, Maoists, former Stalinists and populists … more at home with their comrades in Caracas than in Brussels’.

Avoiding such crudeness, the BBC instinctively knows how to fine tune the media operation ranged against the Greek people. On Monday 22 June, when the European finance ministers were due to meet in Brussels to pass final judgment on the Greek people, the BBC’s Radio 4 Today programme promoted a doomsday scenario for Greece should a deal fail. The story began with news of an airlift plan by British holiday companies to return home thousands of people as cash machines empty, riots break out and vital medical supplies run short.

Yet sometimes the truth slips through. The previous day the BBC had set up a discussion between two significant figures on either side of the crisis: Artur Fischer, joint Chief Executive Officer of the Berlin Stock Exchange, and Sophia Tsikou, a pharmacist, who volunteers at a solidarity clinic in Greece. Fischer admitted to not knowing that people in Greece are already denied vital medicines for cancer and diabetes and that pregnant women have to find €700-800 to be able to give birth safely. Fischer knew the value of the euro, of stocks and shares, but knew nothing of the value of human life. These are the soulless ghouls of banking and business who are dictating even more brutal terms to the Greek people.

The truth is that there has been a health crisis in Greece ever since the Troika 2010 memorandum – five years ago. Numerous institutions, including the British Medical Association’s Lancet journal, long ago reported on the emergence of widespread malnutrition, tuberculosis, untreated HIV infection and severe depressive illnesses since bailout agreements were signed by the previous New Democracy and Pasok coalition government. In return for loans structural adjustments were demanded and delivered. Between 2009 and 2011, hospital budgets were cut by 25% while pharmaceutical spending was halved. 800,000 people were left without access to health services. Infant mortality rates have shot up. The programme, in savagely reducing spending on health care, saw staff striking, occupying and protesting at the cuts. Access to medicines, clinics and hospital care was severely restricted and charges introduced and increased.

As Sophia Tsikou pointed out to the German businessman, 90% of the €240bn Troika loan went straight back to private banks in repayments on existing loans. The Syriza government had extended the deadline for signing up to the banks’ demands – that pensions be reduced and the pensionable age be increased, that the privatisation of national assets goes ahead and that labour laws which give a measure of protection against redundancy be scrapped. Instead we heard from another businessman on the BBC, from the Greek Chamber of Commerce, telling us that ‘The party’s over. Reforms have to be made’. Some party! The status of the British banking system as the world’s foremost money laundering and tax evasion centre is not mentioned by the BBC while its corrupt journalists piously tell the Greek people to pay their taxes!

German Vice Chancellor Sigmar Gabriel, President of the Social Democratic Party, is losing patience. In a chauvinistic attack he attempts to set German workers against Greek workers: ‘Europe and Germany will not let themselves be blackmailed. And we will not let the exaggerated electoral pledges of a partly communist government be paid for by German workers and their families.’ In 1953 the London Debt Agreement relieved post-war Germany of 50% of its international debt. No such generosity is extended to the Greek people. Syriza has had no response to its request for some degree of debt relief. On 20 July, a €3.5bn ECB bond repayment is due. A covering loan of €15.3bn was offered but was made contingent on Syriza signing the austerity deal.

The financial wolves of Brussels, Berlin and the City of London are hunting as a pack. Back in January when Syriza was elected, the ECB unilaterally refused to accept Greek government bonds, knowingly exacerbating the crisis. Six months later, the ECB has frozen Greek access to vital liquidity funds forcing Greek banks to close, limiting daily cash withdrawals from ATMs and imposing capital controls on money leaving the country. The bankers of Europe, the shock troops of European imperialism, are calculating that driving up deprivation and discontent in an economic war of attrition will disrupt and break down the Greek people’s resistance.

The truth is that European imperialism, led by Germany, is the blackmailer here. Its strategy is a coup by stealth, firstly by seeking to divorce the Greek people from their own government and exploiting any equivocation by Tsipras and his government. Already there is a full-on economic and media operation to blame Syriza for the crisis, to undermine solidarity and to promote a ‘Yes’ vote on 5 July. The Greek ruling class and its political representatives in the pro-austerity parties are determined to ensure the defeat of Syriza and that the mass of the Greek people continue to pay for the crisis. Syriza is itself a coalition of different class forces, sections of which are willing to make compromises at the expense of the working class and poor who are the bedrock of a ‘No’ vote and any opposition to austerity. Mobilising the working class is the key to a ‘No’ victory. Tens of thousands of supporters have organised, calling for a massive vote to reject the imperialist austerity proposals on 5 July, and to demand that the Greek government refuse to step back. Millions must be mobilised. The Greek working class must prepare for battle. We stand with them in their fight against European imperialism.                                                                                                                

Michael MacGregor