The limits of flexibility
At the end of 1996, Moody's Investors Service awarded Greece its BAA1 credit rating.' This will make it easier for Greek capitalists to borrow money abroad. The rating is also a pat on the back for Yannos Papantoniou, Socialist Party Minister of Finance and Economics. For ordinary Greeks, these "rigorous" economic policies have brought misery. Ilyas Altinoglu reports on the waves of protest which have swept the country. Greece has suffered ten years of austerity policies, and most people have seen no improvements in their situation. On the contrary, unemployment is rising and the standard of living falling.
True, Greece is every day more "European" But only in the sense that misery, violence and begging are increasingly visible in the streets. A social fracture is widening, just like in the main European nations.
Most Greeks comfort themselves with illusions. Conversations are dominated by a strange mixture of aggressive nationalism and a cosmopolitanism reinforced by emigration, links with the diaspora, and the internationalism of Greek capital. Everyone agrees that economic backwardness is the cause of our misery. Some say we must tighten our belts to catch up with the rest of Europe. Others say our underdevelopment condemns us to domination by the mandarins of the European Union.
Contradictory, of course. But hardly surprising, given the country's very limited weight within the European Union, and the determination of the Euro-capitalist elite to unravel all the social advances made by the workers over the last 100 years.
Reality is beginning to shake Greece's curious ideological consensus. The country now has one million, mainly "illegal" foreign workers (Albanians, Kurds and Poles), in a total population of 10.3 million. Meanwhile, wages fell 20% in real terms between 1985 and 1996, and sharp cuts were made in social spending
More is to follow. The OECD says Greece has "one of the most generous retirement pension systems in the European Union." And unemployment benefits (less than 50% of the minimum wage, paid for 512 months) are, apparently, a barrier to "labour market flexibility". "
In the old days, Greece had a dense social tissue. Family and village solidarity helped absorb private sector "rationalis-
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HUELGA ations" and the resulting unemployment. But after 10 years of "modernisation," these mechanisms are less and less responsive. Rather than finding a job in a family business or through kinship contacts, young people stay unemployed. Nor can people move back to their village of origin so easily.*
The "underground" economy, and the mass of small companies which characterise the Greek economy are booming, on paper. One in three members of the workforce are "self-employed" , compared to one in seven in the EU as a whole. But in reality, most of these "self-employed" workers are paid on a piece-work or daily basis. With 30-50% of economic activity in Greece undeclared for tax, social security and workplace safety purposes, these marginalised workers, Greek and immigrant, experience "labour market flexibility" in its most modern, infernal forms.
The unemployment rate now fluctuates around 10%, depending on the contraction or expansion of the European Union heartlands.
As in the rest of the European Union, most of the pain is concentrated among young workers, women, immigrants, and the long term under-employed. Vulnerable consensus
Greece is the only EU country which no-one expects to meet the Maastricht convergence criteria, and adopt the new common European currency. Inflation is 6.5%, the public sector debt is 113.4% of GDP, and the government predicts a 1997 budget deficit of 4.2% (assuming GDP growth of 3.3%).
The impossibility of meeting the Maastricht criteria has not prevented the government from trying its best. The combination of domestic cuts, and the knock-on effects of the slowdown in the larger European states,
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RÇ4004 NAUH stifled the signs of economic upturn in 1994, and will probably do the same this year.
Already handicapped in the race towards Maastricht convergence, the Greek bourgeoisie must implement even harsher cuts than in the dominant member states. The Maastricht Treaty was signed by a conservative government, but even the Socialist Party (PASOK) which dominates Greek politics has been won over to the values of neoliberalism. A "modernist" and "European" leadership has superseded the "nationalist" PASOK bosses of the Papandreou period.S The new PASOK leadership has not hesitated to confront its own social base - as striking farmers and teachers have recently discovered
Consensus on the importance of the Maastricht convergence criteria could win majority support, or at least acquiescence, as long as the only alternative was a retreat into nationalism. Though it is striking that the nationalist explosion of the 1980s, when Greece became obsessed with its Turkish, Macedonian and Albanian neighbours, and with the major European powers, did not lead to an isolationist or autarkic strategy within the country's elite
On the contrary, the pro-European wing took control of the PASOK, and steered the party to victory in the September 1996 elections. The conservative right is now entirely oriented towards Europe, without the "national sovereignty" ruptures visible in Britain and some other countries.
On the left, only the Communist Party continues to blame "foreign powers" for all the country's problems. The Synaspismos (Left and Progressive Regroupment) coalition has reinforced the pole of trade union and communist militants who are convinced that "there is no salvation outside Europe."
May 1997 #288 9
* Greece The other left party, the Democratic Social Movement (DIKKI, formerly part of PASOK) criticises the Maastricht Treaty, but does not suggest that Greece renounce its signature on the document!
Greece is probably the only European Union where the bourgeoisie as such is marginalised in public political life. PASOK wins most of the elections and, in September 1996, the Communist Party, DIKKI and Synaspismos each won about 5% of the national vote. The conservative New Democracy Party has been out of power for nearly 20 years, apart from a brief taste of power in 1990-93, when the party tried to run parliament with a majority of one vote.
People only voted for PASOK because they knew the right would attack even harder. During the campaign it was virtually impossible to find a party worker who agreed with PASOK leaders. Waves of protest
Nevertheless, the election results were seen by the working population as a victory for left currents in society. And there was a bitter response when the "socialist" government began to cut spending and increase revenue. The first to demonstrate were mothers of large families, threatened with a reduction in their benefits. Then retired people, who were told that they would have to pay more tax.