Crisis and the bankruptcy of Greek economy

In the last five years, a steep deterioration in the condition of the Greek economy has been observed – a destructive course that has eventually led to bankruptcy, contrary to the completely unsubstantiated claims of both the big bourgeois and the Khruschevite parties.

Side by side with the objective economic laws, the implementation of the most extreme neoliberal financial policy by the reactionary government of Karamanlis intensified even further the already existing problems of the Greek economy, aggravating basic economic indicators.

In 2009, the condition of the Greek economy became aggravated to the very extreme point that the government of Karamanlis was not able to work out the state budget – an economic situation characterized by very high inflation and successive waves of high prices, rise in mass unemployment to around 15% and rising rapidly, a drop in industrial and agricultural production, a tremendous deficit increase to over 14% of GDP (more than 30 billion Euros), an increase of the external debt to an overwhelming level, around 120% of GDP (more than 300 billion Euros).

The problems of the Greek economy have deepened even more with the outbreak of the global financial crisis. However, it has to be noted that the crisis of the Greek economy preceded the global financial crisis, since it had already hit, first and foremost, the construction sector, which, as it is known, is linked to a series of industrial branches.

The overwhelming external debt and the very large deficit led the Greek economy to bankruptcy, resulting in the country becoming the “weak link” of the imperialist European Union (EU) and the object of concerted attacks of international speculative and usurious capital – attacks related not only to the Greek economy, but also to the Euro, in the context of the Euro-Dollar antagonism.

In 2009, the terrible financial condition and bankruptcy of the Greek economy led to the “changing of the guard,” initially the removal of Karamanlis’s government and subsequently the defeat of his party in the elections as well as the entry of the country into supervision, initially by the organs of the imperialist EU, and subsequently by the triple austerity plan of the Commission-European Central Bank (ECB)-International Monetary Fund (IMF), that is, it led the country to a new occupation, without military presence.

The new measures consisted in unprecedented decrease in wages and pensions, increase in indirect taxes, etc. and attack on social security rights (an increase in retirement age limits, low pensions, etc.) by the “troika” of the Commission-ECB-IMF, in agreement with the new social-liberal Papandreou government, which deepened the proletariat’s absolute degradation to the extreme and annihilated in one night all the gains of the working class. In response, the working people participated in strikes and massive demonstrations, even though the reformist leaders of GSEE-ADEDY (General Confederation of Greek Workers-Civil Servants’ Confederation) declared the first general strike very belatedly, the first on May 5, and the second one on May 20.

Yet, despite the massive participation of working people in the strikes, there has not been UNITY on the level of gatherings and demonstrations during strikes, resulting in the obstruction of their MASSIVENESS and the undermining beforehand of the working people’s struggle against these unprecedented measures. The UNITY of strike rallies is a presupposition of MASSIVENESS. MASSIVENESS cannot be achieved without UNITY, an issue directly connected to the strikebreaking role of the reformist leaders of PAME (the trade union controlled by the “Communist” Party of Greece-“K”KE).

The strike-breakers-reformist leaders of PAME – through the permanent fragmentation of strike rallies with their separate gatherings – in the past helped the government of the monarcho-fascist party of Nea Dimokratia, with C. Karamanlis as prime minister, to promote and implement all the anti-popular and anti-worker measures; today, by continuing the same disruptive tactic in strike rallies, they are in the service of the government of the big bourgeois PASOK, and they are helping-enabling it to pass the present annihilating measures. For it is not possible for the reformist leaders of PAME to not understand that with their disruptive tactic they immediately break the UNITY of strike rallies, obstruct their MASSIVENESS and thus render the strike rallies INEFFICIENT beforehand.

The new, even more annihilating measures, that were taken and “sucked dry” the poor, that it are being planned to be passed for the social security slaughter of workers’ rights with the further looting of THEIR OWN MONEY, with the elimination of provisions in health and pensions (the class callousness of cutting two pensions per year had already preceded this), those that the extortions of the imperialists will continually demand, cannot be repelled by the working people if there is no MASSIVE UNITY, which are the qualities that can make strike rallies EFFICIENT, that is, capable of defeating or holding back the attacks of capital. This was evident in the case of the great strike rally of the reformist GSEE-ADEDY, which was the only efficient one, forcing Simitis’s government to withdraw the draft of the bill for Social Security in 2001. Now, the messages of the spontaneous worker and popular response are the same. The great strike of May 5, with a gathering of 250.000 people in Athens alone, smashed in practice the rationale of isolationism, disruption of unity and strike-breaking. The participation en masse of working people within the union blocs, the gathering was UNIFIED and showed the way for the working class to win demands: the way of militant unity. The militant voice and action of the working people, the unemployed, the youth, the pensioners, was overshadowed by the throwing of a Molotov cocktail into a Marfin Bank branch office, which, regardless of the intentions of those who threw it, caused the death of three young working people: this is a reactionary criminal act, completely alien and hostile to the workers’ movement. The responsibilities of the banker Vgenopoulos and Marfin Bank, who must be brought to court, are also tremendous (since they blackmailed the workers to go to work, they “locked” the door of the bank while the workers were inside, etc.).

The working people showed once more the way to confront the crisis:

• Capitalist industrialists and bankers must pay from their fabulous profits, along with all tax evaders
• Business taxation must be increased from 20-25% to 35-40%, with a further increase in taxation when businesses fire workers and do not invest productively
• The fabulous landed and other property of the Church, which does not belong to it, must be taxed in its entirety
• Indirect taxes hitting exclusively the broad lower masses must be decreased
• Direct taxation must place the burden on the capitalists, also natural persons, without affecting the tax exemption of the poor
• Military expenses must be decreased drastically

We demand unilateral suspension of usurious debt payments – Withdrawal from the EMU-EURO with an immediate prospect of withdrawing from the EU

In contrast to the fabrications of the government and bourgeois politicians that “the country has not gone bankrupt, along with the Khruschevite social-democrats “K”KE (Khruschevite-Brezhnevites) and SYN (Coalition of the Left of Movements and Ecology – Euro“communists”), who are also disputing the existence of bankruptcy (Papariga – “K”KE: “they are bringing back the scarecrow of bankruptcy,” “Rizospastis” April 23, 2010, p. 6, Tsipras – SYN: “the tale about the dragon of bankruptcy is nice,” “Eleftherotypia” March 14, 2010), bankruptcy is a concrete and painful fact.

An analysis of the relevant economic data can only reach the conclusion that the figures show indisputably the bankruptcy of Greek economy:

1. an overwhelming external debt of more than 300 billion Euros, or about 120% of GDP (with a minimal to nonexistent industrial production, while even the “production” of waiters decreased with the fall in tourism since last year),
2. a huge deficit of more than 30 billion Euros or 14% of GDP,
3. a usurious 7-10% interest rate with spread of 500-700 bps (an interest rate that only bankrupt countries borrow at),
4. inability to service the external debt,
5. the triple austerity program by the Commission-ECB-IMF and designation of financial politics not by the elected government but by the delegations of the imperialist organizations, and
6. recourse to the so-called EU-IMF “support mechanism” for a further loan of 5%.

The ND was the party that had been leading and led the country’s economy to bankruptcy with mathematical precision, by doubling the external debt (more than 300 billion Euros) and multiplying the deficit by five (more than 30 billion Euros), leading to the country’s triple supervision by the Commission-ECB-IMF, and has the first and major responsibility for this reason. But the then-opposition parties, the big bourgeois PASOK, and “K”KE and SYN (the Nazi-fascist LAOS had identified with the politics of ND), are tremendously responsible as well for not revealing to the Greek people this destructive financial course, which, for at least the final two years of ND’s governing, was completely clear to the naked eye.

The condition of the bankrupt Greek economy of today is bleak, and its prospect within the framework of EMU-EURO is at an impasse. The current bleak condition of the Greek economy has obviously led to the exposure of a series of bourgeois and revisionist myths (old and new) about the relationship between Greece and the EU, regarding 1) “equal participation in the EU,” 2) “permanent growth within the EU,” 3) “convergence of the EU member states’ economies,” 4) “permanent prosperity,” 5) “decrease in interest rates,” 6) “safeguard from bankruptcy,” etc.

With these negative developments in the Greece-EU relationship, the current complete deadlock of the bankrupt Greek economy, along with the fact that the big bourgeois PASOK government will not only multiply the annihilating anti-popular and anti-worker measures, but with the “gospel” of neoliberal financial politics in its hands, it intends to satisfy even more the lust of the speculators and loan-sharks and the IMF for the total looting of any remaining profitable sectors and savage looting of the country’s overall wealth with the proportional destructive consequences, known to tens of other countries that fell into their clutches. The working class and the people must fight for the country’s withdrawal from the EMU-EURO and the declaration of unilateral suspension of external debt payments (an issue discussed in “ANASYNTAXI” No. 313, January 1-15, 2010), in combination with the general struggle for Greece’s withdrawal from the imperialist EU, a withdrawal that for the social-democrat Papariga (general secretary of “K”KE), at this moment “is not a solution in itself” (“Rizospastis” March 5, 2010, p. 10) (it is the first “unwary”(?), but delightful and characteristic strip-tease by Papariga in favor of Greece staying in the EU, since the leadership of “K”KE claimed until now, of course for reasons of demagoguery, that they were in favor of the country withdrawing from it).

The working class, the youth, the city and village poor, must fight everywhere, in each workplace, each space of education, residential area, and gathering place against the awkward Khruschevite social-democrats “K”KE-SYN, who deny the existence of bankruptcy and say not even one word about the tasks that derive from it, for the creation of a broad antifascist and anti-imperialist front, which will unite in the aforementioned goals of confronting the anti-worker whirlwind and in the struggle against suppression, the curtailment of democratic gains, the fascistization of public life, which are the necessary “tools” of capitalists and their political representatives in order to pass the measures of sordidness.

June 2010

Movement for the Reorganization of the Communist Party of Greece 1918-55