Greek nation to vote on austerity

An event of great importance is scheduled for Sunday, July 5, in Greece. On that day the people of Greece will be in a referendum on a bailout deal proposed by Greece’s creditors, a referendum which is, in fact, a vote on the entire neo-liberal agenda.

Recent developments in the U.S. – decisions of the U.S. Supreme court, its support of the healthcare initiatives of President Obama and its defense of same-sex marriage, as well as the developments around the confederate flag, (note – the former flag of the pro-slavery forces in the U.S. civil war) — have thrown the right wing in the U.S. into disarray. The question for us is whether or not they will be able to regroup in time for the election or if the people’s movement can keep them on the defensive, not just in the U.S. but worldwide. In this context, the Greek referendum is critical.

On June 26, as was originally reported by Anastasios Papapostolou in the “Greek Reporter,” Greek Prime Minister Alexis Tsipras announced that Greece will hold a referendum to ask the Greek people if they approve of a bailout deal with the country’s creditors, a take-it-or-leave-it deal that he characterized as a violation of the rules of the European Union and common decency. In his address to the nation Tsipras said that, “After five months of tough negotiations, our partners unfortunately resorted to a proposal-ultimatum to the Greek people.” He called on the Greek people to reject the “blackmailing ultimatum” that would mean, “strict and humiliating austerity without end and without prospect.” For her part German Prime Minister Angela Merkel, who many see as a leading force in this latest drive to humiliate Greece, urged Greece to accept the deal.

In concluding his address Tsipras expressed the confidence that the Greek people would honor their nation’s history and would reject the ultimatum.

In a demonstration of solidarity with the working people of Greece, the AKEL party of Cyprus has called for a major demonstration on July 4 outside the House of Europe in Nicosia.

In contrast to the anti-social, neo-colonialist policies of the IMF and the EU, policies that have been called authoritarian, blackmailing, and anti-democratic the Syriza government of Greece has proposed a package of pro-people reforms, including measures to limit foreclosures, protections for working people, measures to eradicate bureaucratic impediments to doing business in Greece. These are reforms that attack parasitic and non-productive activities rather than measures that raised tax rates and reduced the benefits of the working people.

On June 19, Yanis Varoufakis, the Greek finance minister, formally reported on the proposals he had made before a meeting of the Euro group to end the crisis. In their effort to turn peoples of one country against another the pro-austerity forces in the Euro group have been saying that the Greeks have been irresponsible and now want the peoples of other countries to pay their debt. Varoufakis said, however, that Greece will never, “… ask you to subsidize our state, our wages, our pensions, our public expenditure. The Greek state lives within its means.”

In any case, the attempts by previous Greek governments to bow to the demands of austerity have plunged Greece into a six-year-long uninterrupted recession.

In his report Varoufakis made clear that first off and overall any agreement must render the Greek debt sustainable. Further, Varoufakis outlined some of the devastating consequences for the Greek people. Wages have fallen 37 percent, pensions 40 percent, official unemployment is at least 27 percent and unofficially is likely much higher. Overall the aggregate real GDP has fallen by 27 percent

While the austerity hawks of the Euro group are demanding more cuts aimed at labor, pensioners and the Greek state in general Varoufakis said that there should be no more pension cuts but rather a reduction of early retirements and elimination of pension fraud, fund consolidation and the reduction of operating costs. Varoufakis also proposed reforms that would target the traditional oligarchs – such things as more efficient collection of taxes and anti-corruption measures. He also proposed a deficit “brake,” a mechanism that would force a reduction in all monetary outlays based on the nations week-to-week budget (deficit or surplus).

Despite rumors circulating to the contrary all statements by the Greek government insist that there will be no “Grexit,” a shorthand expression for a Greek exit from the Euro zone, dropping the Euro currency and returning to the Drachma. Nothing of the sort has been proposed or is planned. Indeed it is quite likely that more terrifying to the German and other bankers then the prospect of a “Grexit” is the threat of a “bad example.” If the vote on the referendum shows that it is possible to resist the neo liberal agenda – if the Greek people can do it – then why not the Spanish, the Portuguese and the Irish in short all the other European peoples who now are suffering under the yoke of austerity.

In a June 5 interview with Yiannis Bournou, a member of the Political Secretariat of Syriza, contrasted the neo-liberal agenda to the proposals made by the Greek government. He pointed out that at this time the Syriza government is the only left government in Europe and for the time being they are standing alone against the neo-liberal agenda.

In the interview he made clear that the present Greek debt is unsustainable and must be restructured but that the government was not asking for new loans. Instead money can be taken from already exiting funds of the European Investment Bank to create a “growth fund.”

He said that several months ago Syriza had sent a 45 page document to the IMF (the International Monetary Fund), rejecting austerity measures, in fact anything that would tend to increase the burden on working people, pensioners and the poor. The document proposed reforms of the tax system and taking other measure to ensure that the rich paid their fair share.

The IMF responded in May 2015 with a 10-page document sent to Prime Minister Tsipras ignoring the prior Syriza document and instead demanding more austerity. In view of this on June 5 of this year, the Syriza government intentionally did not pay its monthly installment on loans that previous governments had gotten from the IMF saying that they would delay until the end of the month (along with any June payment), if an agreement was reached. Well, June ended without an agreement and now the Greek government has decided to put the issue to the public in the form of a referendum.

Speaking of related developments, Bournou mentioned the last local election in Spain, in which the anti-austerity grouping Podemos did well. Bournou said that this result had come at the best possible moment sending a message to the both the leadership of Spain and the right wing leadership of the EU, blunting Neo Liberal designs to contain the contagion. Certain circles very much fear what is happening in Spain because Spain is a much larger economy than Greece.

Given the real prospect of greater Podemos victories in Spain, one can see why the right considers it so important to force the Greek public to accept austerity and resign themselves to the fact that there is no alternative. Otherwise the end of the neo liberal project may be in sight.

A ‘No’ vote on austerity would also greatly strengthen the anti-austerity agenda of Sein Fein in Ireland. Like Podemos, Sein Fein was a mass movement before it became a political party, and thus it likely has an even stronger and deeper base then does Syriza. On the other hand, if the citizens of Greece vote to accept austerity then, even if Podemos comes to power, they will be forced to bow to the will of the European Central Bank and to accept the austerity agenda also.

Photo: Pensioners chant slogans during an anti-austerity protest in Athens, June 23. (AP Photo/Petros Giannakouris)