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writing for godot

Greece: A People's Backlash Against Austerity

Written by David Starr   
Wednesday, 25 February 2015 11:53

For the past six years, Greece has been pummeled by austerity measures, making it a financial basket case.

This Greek tragedy has resulted in cuts in social programs, privatization and a $360 billion debt. It was inevitable that tens of thousands of Greeks would take to the streets in protest, and voting for the radical left Syriza Party to lead the government.

The new Greek government is now in a struggle with the main perpetrators of austerity, the Troika, comprised of the European Commission, the European Central Bank and the International Monetary Fund. Greek Prime Minister Alex Tsipas tried to remain positive, saying that "altogether, we can find a mutually viable solution" in dealing with Greece's debts. But he didn't mean continuing the same austerity measures as part of the negotiations. It must stop.

The Troika, of course, has other ideas, or more likely the same ones if it can get away with it. Its bottom line attempts to impose austerity could drive Greece out of the Eurozone. The populations of other Western European countries like Spain, Portugal, Italy and Ireland no doubt feel inspired by the Greek example, and thus may vote for leftist parties or coalitions. Those countries may also then opt out of the Eurozone if austerity continues.

The monetary conflict between Greece and the Troika has stalled negotiations. Greece wants to renegotiate its debt to the European Union and IMF. The Troika, however, is trying to play "hardball," e.g., refusing to allow Greece to sell government bonds to raise money.

Historically, austerity has been a general failure for the masses in Latin America (where it started), as well as for Ireland, Portugal and Spain. It has weakened workers' ability to bargain for a fair wage and fuels economic inequality. The latter is shown by the top 1% controlling 48.2 % of the world's wealth, according to the credit suisse Research Institute.

Further proof that Greece won't go along with business-as-usual is in the person of Finance Minister Yanis Varoufakis, who takes a tough stand against austerity. "Anybody who is tempted to think it possible to amputate Greece from Europe should be careful. It is very dangerous. Who will be hit after us? Portugal? What would happen to Italy when it discovers it is impossible to stay within the austerity straitjacket?"

Varoufakis takes the position that "if you are already in a [financial] hole, stop digging." Stop going further into debt by accepting predatory loans.

Tsipras, Varoufakis and Syriza would accept loans, but not if they are onerous. The goal is to actually get Greece out of debt, not have it further sink into economic quicksand.

David Starr writes on various issues, both national and international.
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