“There will be blood on the streets” Austerity and Democracy in Greece + The Eurozone

[Reuben]

Ok Apologies for the slightly social democratic perspective. This is a piece I just wrote for The Third Estate:

“There will be blood”: Austerity and Democracy in Greece and The Eurozone

It is rare to hear government ministers predicting revolt. Yet in recent days, the Minister for Labour in Greece’s social-democratic government has done just that. Mr Lomberdos has warned that the package of austerity measures that his government are poised to implement will lead to “blood”. Already Greece has seen strikes and occupations.

Like Britain, Greece is faced, on the one hand, with deteriorating public finances, and on the other hand with a situation which seems to necessitate serious deficit spending. In situations such as the one we face now, the ability of governments to to run budget deficits – to tax less and to spend more – represents perhaps the most substantial tool by which the economic pain felt by ordinary people can be mitigated. For all of their faults, the Labour government have, through spending far more and reducing certain taxes, been able to prop up demand, and ensure that unemployment – while huge and immensely damaging – has risen relatively slowly compared with previous recessions.

Greece too is running a huge fiscal deficit. Yet the situation it faces is rather more severe. This is in part because it is seen as a less reliable borrower, making it costlier and more difficult for the government to keep up its borrowing. Yet it is also because the Greece is part of the single currency. Whereas the UK Government plans to reduce the deficit relatively slowly – so that in 5 years time it will still exceed 5% of National Output – Greece plans to rapidly reduce its deficit to from 12.4% to under 3% of GDP. Why? Because the rules mandate that it must. Membership of the Eurozone officially obliges governments to keep budget deficits beneath 3% of GDP.

Such a course of action will be disastrous for the economy and for social welfare. When one considers the level of cuts, privatisations, and public sector job losses necessary to conjure up one tenth of GDP from the public purse, it is possible to imagine why even government ministers are fearing blood on the streets. To offer just one illustration, the governments to hire just one civil servant for every 5 that retire.

Yet this situation also illustrates the impact of the EU and the Euro upon democracy. Hundreds of thousands, if not millions, of jobs will depend upon how quickly and how much the Greek government cuts public spending. It would seem obvious to anybody with the most basic democratic instinct that such decisions should be taken by elected politicians, by people accountable to those who stand to suffer. Yet in the Eurozone these decisions are mandated by a set of semi-permanent rules, and enforced by unelected EU commissioners. The conversations that Greek politicians should be having with Greek people about how to move forward, they are instead having with bureaucrats in Brussels. That membership of the Euro is supported people who claim to be democrats, and indeed people of the left – for whom economic democracy represents the most important form of public power – continues to amaze me.

[FSL]

If you're also getting your news from http://libcom.org/news/there-will-be...epens-26122009 then some remarks about its accuracy are made here http://www.revleft.com/vb/showpost.p...75&postcount=7.


Firstly, this is hardly a "slightly social democratic perspective". Labor governments for many decades now spend mainly to support capitalists. The only tax that is being reduced is the tax on business profits. Besides, it was not a labour but a conservative government that ran the deficit so high so you might want to include something on how neoliberals care for the poor.

Also, I don't support EU at all. I want it to burn. Literally, if possible. But to say that what's wrong with is just a certain lack of democracy, that too much power lies in the hands of Brussels bureaucrats, where is this leading to?
The mightiest among those dreaded bureaucrats are mere puppets of european capital. They take all the beating so that capitalists can continue to be the succesful rolemodels that bring jobs to everyone and put food on our tables.
When did elected bourgeois politicians honestly discuss economic policy with their voters? Maybe only to make sure they don't go too far, that their actions won't cause a massive reaction. But only up to that point. Because otherwise they're very fond of just leaving things to the local bureaucrats who will decide how much will the workers pay for the capitalist's wellfare. Their only concern after the decisions are made is to put on a nice smile and a matching tie and present the much needed reforms to the people.

So, generally, I don't really know if you simply wanted to know if your article is well-written. I don't really know whether your blog is left, left-leaning or just progressive. It's not ground-breaking but it seems like something one could stumble upon while reading their paper.

[Revy]

If we're to battle over symbolism, something larger would be a battle over one of the two national mottoes, In God We Trust. The other one is E Pluribus Unum, which is very meaningful. While In God We Trust is just a blatant pandering to religion. It's also the state motto of Florida.

[Bitter Ashes]

It's also the state motto of Florida.

Unless I'm mistaken, it's also on all your bank notes too.