The decent stance of Syriza’s government indicated its intention not to betray the people, and the effect on the government of the mass rallies held in all major cities of Greece with the key slogan: “Not a step back!”.
Germany’s intransigence is grounded in the fear among sections of the ruling elite that if they relent on austerity for Greece, then they will encourage anti-austerity movements in Spain, Portugal, and Italy.
German finance minister Wolfgang Schäuble claimed that he “pities” the Greek people for the “irresponsible” government that they have elected. He demanded that the Greek Government humiliate itself by signing a statement to waive the application of its social program.
The driving force here is not so much arrogance and a sense of power, but fear and a nervousness lest developments tend to escape their control. The wave of solidarity with Greece shocked Berlin. German neoliberal hegemony in Europe has begun to show symptoms of deterioration.
The Syriza government proposals have watered down its commitment to the Thessaloniki declaration and the programmatic decisions of Syriza’s conference. The government has abandoned the claim for the cancellation of the majority of the debt and is restricting its proposals to techniques for the relief and lowering down of the annual cost of debt repayments. The Greek banking system remains controlled by the Troika and its major shareholders, and not the slightest initiative has been taken for its transfer under “public control”. In the field of privatisation also, the abolition of the privatisation agency Tayped has been “frozen”.
So far the government appears adamant on its adherence to the Thessaloniki declarations; but when negotiating with the creditors has been prepared to make concessions which may practically undermine its own commitments.
This is a reflection of the contradiction in the logic of pursuing an agreement that would be “mutually beneficial” for the Greek working class people and popular strata and their creditors.
A short-term “bridge” deal cannot be neutral. It will either be a “bridge” towards the acceptance of cuts and neoliberalism, or it will be a “bridge” to overturn the policies of austerity. Conflict is inevitable: it looks like it will come early and be very hard.
But the mood and confidence of the working class and the mass of the people has been uplifted and is defiant. In Greece, support for the government, provided that it maintains a hard negotiating stance, is now a majority!
That mood is filling the streets and the squares, with four rounds of rallies so far all across Greece, and over 30,000 people in Syntagma square on Sunday 15th.
Not a step backward from the goal of overturning the austerity! We are not negotiating for a limited “relaxation” of the rate of the imposed austerity, but to overthrow austerity.
No to any “bridge” which incorporates memorandum commitments, regulations and policies. The only “bridge” we’re discussing is a financial deal to cover the negotiating period.
The symbolic test will be the choice of the President of the Republic. Syriza should avoid a choice from the memorandum politicians of the centre-right, and should select a personality that will symbolize the democratic struggles and the cultural influence of the workers.
If the Germans insist on an ultimatum this Friday (20th), we see no way out other than Syriza’s government calling a referendum within few days with the question whether the Greek people, empowers the government to insist at all costs (including the risk of Greek expulsion from the euro) on the implementation of its programmatic commitments endorsed by the Greek people and approved by the Greek parliament.
The government should also disarm the “internal” allies of the Troika. Immediately place under public control the FSF and the Bank of Greece. Socialise the assets of the tax evading-oligarchs. Immediate establishment of workers’ control in enterprises. Every large company that evades taxes should be socialized.
Cease privatisation immediately and initiate the process of recovery of public ownership and control over public infrastructure, goods and servicess that were privatized.
Fight against corruption and wastefulness in the state, through a thorough control across the range of the state apparatus by the unions and elected committees of workers in government agencies and businesses. The army and security forces should pass under the democratic control of the mass organizations of the workers and for the riot police should be disbanded.
Socialisation of Church and monastery property to finance the necessary social policy.
Reduction of working hours without loss of pay, and a public works program against unemployment.
Call on European workers for joint struggle for the United Socialist States of Europe.
The last few days have shown clearly that the only true partners and allies of the government of Syriza are the Greek and European workers. With dozens of gatherings and acts of solidarity, workers show that they see Greece not as an isolated country, but as a people that dares to go first against the rules imposed by capitalism and the financial oligarchy.
Without the militant and massive activation of Syriza’s rank and file organizations without the democratic operation of the collective bodies of the party, the government policies will become uncontrollable, and the politicisation and coordination of the movement, the organisation of international solidarity and a united front of the Left will become unattainable.
It is the duty of the revolutionary Left in and outside Syriza to reconnect with the rank and file of Syriza and with the combative working class movements and other movements from the last five years.
They should not wait passively for the implementation of the Thessaloniki platform by the government, but mobilise to guarantee implementation. They should organise in their unions or create new unions where there are none; conduct meetings and create struggle committees in each area and neighbourhood.
The continuation of the struggle of the ERT workers, the demonstration in Skouries Chalkidiki, and the two-day open conference of the self-organised factory of BIOME are steps towards the right direction.
In parallel, Greek workers should make a clear and specific call for workers across Europe, to support actively their class sisters and brothers in Greece and to fight together for the United Socialist States of Europe.
The Greek government has called for “bridging finance” while a new agreement is worked out following the expiration of existing arrangements at the end of February.
It proposed to the Eurogroup:
•Scrap 30% of the bailout programme in exchange for ten new reforms agreed with the OECD (meaning 70% would be kept).
•Reduce Greece’s primary surplus target from 3% of GDP to 1.5% this year, and keep it around this level for the medium term (as opposed to increasing it to 4.5% as currently planned).
•A swap plan for the loans to Greece to ease repayments. This is likely to focus around the previous proposals of turning Eurozone loans to Greece into GDP linked loans or bonds and asking the ECB to swap its current holdings of Greek bonds for “perpetual bonds” (bonds which are never repaid.
•Allow Greece to tackle its humanitarian crisis.
•Funding from the transfer to Greece of €1.9bn in profits on Greek bonds held by the Eurosystem and an €8bn increase in the short term debt issued by the Greek government of .
•Other potential funding lines include tapping into the €7.2bn tranche of EU/IMF/ECB Troika funding waiting to be released or using the €11bn leftover in the bank recapitalisation fund.
•The plan would run until September and allow time for negotiations over a “new deal” on Greece’s debt.
Following the “unsuccessful” meeting of European finance ministers on 11 February and the EU leaders’ summit on 12 February, the German government made a tactical manoeuvre. The German government appeared willing to consider the proposals of the Syriza government for the part of the Memorandum that accepts, under a diplomatic formula of a combination of the existing memorandum program with the “bridge” that the government is asking for.
On this basis, a common “technical” committee was established (which worked till Sunday night) aiming to investigate the possibility of a political agreement for Monday 16th.
However, as Alexis Tsipras correctly stated, a technical agreement requires first of all a political agreement. And we don’t have that. The new Greek government, despite some hiccups and setbacks, mainly due to Dragasakis and Varoufakis, held to their red lines: reversal of austerity, eliminating Memoranda, and evicting EU/ECB/IMF Troika from the country. So there was no agreement on 16 February.
The German government used the statement by Greek finance minister Yanis Varoufakis that “70%” of the Memorandum was “non-toxic”. Of course, how much you count as 70% is open to definition: we can guess Varoufakis thought he was being clever. Nevertheless, Varoufakis’s statement went outside all Syriza’s programmatic and pre-election commitments. And there was no deal.
The German government and all the other bourgeois governments wanted to send a political message: the rules of austerity and “structural reform” (neoliberalism, reduction of workers’ rights, privatisation) must be respected, regardless of whether they violate the democratic will of the Greek people.
The eurozone finance ministers’ draft document put as priorities for coordinated action a new attack on labour and insurance-pension rights and the selling off of public property. They wanted commitments such as: “to successfully complete the current memorandum program,me taking into account the new Greek government plans... commitment to refrain from unilateral actions and to work in close coordination with European and international partners, particularly in the area of tax policy, privatisation, labour market and pensions reforms and reforms of the financial sector”.
The Eurogroup gave Greece until Friday 20 February to request an extension of Greece’s current program, stating that “there is no alternative” and the next move must come from Athens. Dutch finance minister Jeroen Dijsselbloem, head of the Eurogroup of finance minister, stressed that the extension of the program involves commitments from the Syriza’s government. He said that there was “some scope of flexibility within the programme”, but it had to be “without unilateral actions or cancellation of measures already undertaken”. He also said that every new proposed measure by Syriza’s government should be fully costed and funded.
“Syriza’s government has one week to decide, but that’s all,” he stressed.
The Greek government stated that they could not accept a document which was in stark contrast to the will of the Greek people:
“It seems that certain circles do not want negotiations and insist to support a program that has failed... Throughout European history democracies rejected the ultimatums. European democracies neither blackmail nor accept being blackmailed”.
Finance minister Yanis Varoufakis stated that he was confident that within the next 48 hours the deadlock would be broken and there would be a “fair deal”. He revealed that before the start of the 16 February meeting he was ready to sign a document presented by the European finance commissioner Pierre Moscovici but eventually withdrawn.
This document was talking about extending the loan agreement for four months as a bridge to a new program. “Unfortunately this good document was withdrawn” by Dijsselbloem, and “an alternative document which talks solely about the extension of the memorandum was presented”.
The European Central Bank will decide on Wednesday 18th whether to maintain emergency lending to Greek banks. Greece faces some heavy loan repayments in March. Deposit outflows in Greece have picked up. J P Morgan bank says that at the current pace Greek banks have only 14 weeks before they run out of collateral to obtain funds from the central bank.
The ECB has allowed the Greek central bank to provide emergency lending to the banks, but a failure of the debt talks could mean the imposition of capital controls. Eurozone member Cyprus was forced to close its banks for two weeks and introduce capital controls during a 2013 crisis. Such controls would need to be imposed when banks are closed. Greek banks are closed next Monday, 23 February, for a regular holiday.
As Paul Krugman correctly points out, the Eurogroup persists on the aim of the primary surplus of 4.5 percent of GDP, which is unrealistic within the context of a country with a shrinking GDP. Krugman reckons “they’ve decided to push Greece over the edge.
Rather than give any ground, they prefer to see Greece forced into default and probably out of the euro, with the presumed economic wreckage as an object lesson to anyone else thinking of asking for relief”.
A worrying sign is the Greek government’s choice of people for the “national negotiation team”.
Dimitris Mardas has been made deputy finance minister. He comes from Pasok, and up until recently was a high-up member of Potami. There are articles signed by him on Potami’s site from as recently as 19 January. In his articles he has often criticised the policies of Syriza as “cheap and easy anti-memorandum populism”.
In a radio interview after assuming his ministerial duties, he stated that he had been assured that the government would follow a prudent and modest route during the negotiations with the EU.
The Greek delegation in Brussels also included Elena Panariti, former Pasok MP and special adviser to George Papandreou. She worked for the World Bank on the “rescue” of Peru under the Fujimori dictatorship in the 1990s.
These are not just a few technocrats who are used, under strict governmental supervision, as an interim emergency solution.