Greece

The euro will survive for now — but only because working people in Greece and other European countries face greater suffering. That’s the not-so-hidden agenda behind the new US$227 billion bailout of Greece organised by the most powerful countries of the European Union, mainly France and Germany.

As rocks fly and tear gas wafts through the streets of Athens, Greece’s Prime Minister George Papandreou has warned of a coming crackdown on protesters and striking workers. Meanwhile, a new bailout for the banks is being prepared in the halls of power in Europe. Papandreou was able to secure breathing room for the Greek government with another round of emergency loans that saved it from the immediate prospect of default — the state failing to pay back some or all of its debts.

The Greek parliament defied huge popular opposition, including a 48-hour general strike, to pass the latest set of extreme austerity measures demanded by the “troika” (the European Union, the European Central Bank and the International Monetary Fund) in return for fresh loans. However, many commentators have pointed out it is one thing to vote up the measures and another to force them on an increasingly discontented populace.

The Greek parliament defied huge popular opposition, including a 48-hour general strike, to pass the latest set of extreme austerity measures demanded by the “troika” (the European Union, the European Central Bank and the International Monetary Fund) in return for fresh loans. However, many commentators have pointed out it is one thing to vote up the measures and another to force them on an increasingly discontented populace.

Greek Prime Minister George Papandreou and his PASOK party government survived a June 21 confidence vote in parliament. This came ahead of a parliamentary vote scheduled for a week later on the austerity measures demanded of Greece in return for new loans from the European Union (EU) and International Monetary Fund (IMF). Greece is in the grip of a desperate economic crisis. The government bailouts, engineered by the EU and IMF, have come with demands to slash spending, cut the wages and benefits of workers, and privatise public enterprises.

It’s been a year since the “memorandum of understanding” between the International Monetary Fund (IMF) and the Greek government was signed. It is now clear it has failed to deliver the country’s promised economic recovery. As confirmed by the treasury data, Greece’s debt has risen rather than fallen. At the same time, the impact on Greek people of the austerity measures demanded by the IMF has been devastating. Official unemployment has reached about 16% — an all-time high. There are 787,000 people unemployed — 181,000 more than last year.

The standard of living for the people of Greece has dropped dramatically since the signing of the first “memorandum” — the agreement signed by the Panhellenic Socialist Movement (PASOK) government with the IMF and European Union (EU) representatives last May. The agreement has meant — among other things — unprecedented salary cuts, a rise in the allowed number of dismissals and a reduction in termination pay, and a cut in the minimum wage for those entering the workforce.

Greece’s government intends to bump up sales taxes for the third time this year and slash spending on health care. The new measures were included in the 2011 budget it submitted to parliament on November 18. Prime Minister George Papandreou’s Panhellenic Socialist Movement (PASOK) government has already raised the sales tax twice this year. Papandreou had pledged not to introduce any measures that would cause more hardship for ordinary Greek citizens — such as new taxes.

An unprecedented high abstention rate of 39% marked elections for municipal and regional authorities for 13 region governors and 325 mayors in Greece. The second round of the elections took place on November 14. The regions are newly created local authorities. Their formation is closely connected to the austerity program imposed on Greece by the International Monetary Fund (IMF) and European Union (EU). The new bodies conform to the “Kallikratis” plan, a hasty reform of the administrative structure of the country.

Greek workers staged their sixth general strike this year on July 8. The strike halted public transport, stopped ferry services, and closed schools, newspapers, courts and public hospitals. About 100,000 people took part in protest rallies in Athens and Thessaloniki, chanting: “Workers, answer the war declared by capitalists with war” and “Let the oligarchs pay for the crisis”.

In early March, after a three-month media bombardment about the country’s economic crisis, the Greek government — backed by conservative opposition parties, the European Union (EU)and the International Monetary Fund (IMF) — announced harsh austerity measures for ordinary people. These included unprecedented salary, pension, job and public services cuts and large-scale privatisation. The government offensive entails an enormous income transfer from workers and pensioners to big business and the State Revenue Office.

Resistance is building in Europe against government attempts to force ordinary people to bailout the failed financial system of “casino” capitalism. After four general strikes in Greece this year, and two more planned, strike action is beginning in Spain against planned attacks on public services and welfare.