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The Greek general strike

May 14, 2010

The ongoing economic turmoil in Greece has continued to raise tensions in a country that has historically been home to revolutionary ferment.  There are growing signs that this tradition is experiencing a resurgence across Greek society.  The past few years have seen the revolt of a large portion of the youth of the country, set off by the events that lead to the killing of a teenager by Athenian police.  More recently the right-wing government was replaced by the Socialists with promises of protection of workers and the social-democratic state.  The results thus far have been a far cry from the campaign promises.  After only a few months in office the Socialist are attempting to implement austerity measures ton par with the neo-liberal mantra of the IMF and World Bank that has brought misery to so many third world countries over the past 30 plus years.

Faced with a mounting debt crisis and the prospect of insolvency the new government felt the need to push the costs of the world economic crisis and the bank bailouts on to the working population of Greece.  This has proved highly unpopular with the Greeks and has resulted in a general strike and other mass protests.

As mentioned above, Greece has a long tradition of a working class movement, although it has almost always been met with violent reaction from the ruling class, particularly through their arm of power in the military.  Although there have been setbacks for the left and the workers over the years, often very bloody setbacks, the current attempt by the ruling class in Greece (and across the EU for that matter) to save the profit system by pushing the costs from capital on to labor is having a galvanizing effect in the masses.  Popular discontent in Greece is raging at very high levels and from reading the reports coming from Athens and elsewhere one gets the sense that Greek society is simply not going to take the fall for the rich in the name of ‘saving the country’.  The fact that the left has been crushed time and again by reaction before reaching a truly revolutionary situation, while certainly important, is less fundamental than the traditional basis of resistance, solidarity, and organization from which a working class movement can draw from and build upon.

As Alex Latiner writes:

The international significance of the Greek strikes is now widely acknowledged. Citing the Greek protests, New York Times columnist Thomas Friedman warned: “Nothing to do with us, right? Well, I’d pay attention to the drama playing out here. It may be coming to a theater near you.” He added that, as in Greece, US workers “will have to accept deep cuts to their benefits and pensions…”

As in the US and other European countries, much of Greece’s state debt comes from the €28 billion bailout Athens voted for its banks. Now, while the Greek ruling class aims to extract €30 billion in yearly cuts from workers, governments throughout Europe and in the US are preparing to cut tens or hundreds of billions from their budgets.

This winter, the banks bid up interest rates on Greek debt, hoping to make large profits from interest payments while giving Papandreou an excuse for the social cuts he aimed to carry out. This plan has now backfired, however.

As workers protested the cuts and European powers clashed over the terms of a bailout, interest rates climbed so high that the banks for all practical purposes bankrupted Greece. Even if Greece adhered to the three-year, €110-billion European-IMF bailout, it would be shattered—by some estimates, the European-IMF cuts would collapse its economy by 30 percent. By then, however, it would owe even more than the roughly €300 billion it owes today.

The Greek crisis has snowballed into a European crisis, threatening the global economy. The banks are increasingly nervous about lending to Portugal, Spain, the UK, and other countries. Given Greece’s role as a lender and export market for Bulgaria, Romania, and Serbia—and as an employer of immigrant workers—the crisis also threatens to devastate the already impoverished and unstable Balkans.

As they worry that European governments will go bankrupt and that banks will lose enormous sums of money, bankers are also increasingly refusing to lend to each other. This threatens a new credit crunch. European Union monetary affairs commissioner Olli Rehn warned, “Consequences from Greece’s insolvency would be similar if not worse” than the Lehman Brothers collapse of 2008.

The Greek bailout, paid to Greece’s creditors among the banks, will be extracted from the workers twice: first, from workers in countries funding the bailout, and then from workers in Greece, who will have to pay back the loans making up the bailout. In both cases, they will be used as the pretext for massive cuts.

As social conflict mounts and the global capitalist crisis deepens, the ruling class will resort to ever more open forms of dictatorial rule. While such measures have been justified so far on the basis of the “war on terror,” they will increasingly be directed at mass social opposition.

Greece has the potential to be a powder keg for a renewal of class struggle in the EU.  This would be a welcome occurence.  For far too long the historical homeland of the workers’ movement has been devoid of any promising political alternatives or struggles.  It remains to be seen how the Greek working class will respond to the attack on wages, jobs and social programs. What is clear is that in their attempt to maintain their privileged position, the ruling class is taking a risk in producing a social and political situation that will only serve to bring the workers together in opposition against them.

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