How the IMF Broke Greece
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a) a sensible devaluation of the ―new drachma,‖ which would be introduced in place of the euro ―something that would make tourism and exports (particularly of agricultural products which are now suffering from an expensive euro) cheaper, and, at the same time, would make imported commodities more expensive ―a development that would give significant protection to the local agricultural and manufacturing production. Imported basic necessities could be subsidised (so that the lower social strata would not pay higher prices to cover their basic needs) and the subsidies could be financed by the revenues generated through a heavy additional tax on imported luxury commodities, while strict price controls could prevent any unnecessary rise of prices,
b) a renegotiation of debt (under the threat of an immediate stoppage of payments in case this is not accepted), aiming at a significant lengthening of the period of its repayment and a corresponding reduction of the present exorbitant amount,
c) a gradual repayment of the renegotiated debt, through extra revenues generated mainly from a new and highly progressive tax on wealth, on any kind of property with a total value exceeding, for instance, €1m. The calculation of the tax to be paid could be based on the results of a general census of property located in Greece, as well as of deposits in foreign banks, etc., with the state proceeding to confiscate any property of a corresponding value to the estimated tax in case property owners declare inability to pay within a reasonable short period of time,
d) a parallel introduction of strict controls on capital movements, so as to stop any movement of speculative or non-speculative capital abroad (only in recent months the outflow of capital has exceeded 10 billion euros[54]), and protect the new currency from speculation.
The combination of these measures would mean the generation of more jobs and incomes, as well as a decrease in the hugely unequal distribution of income, in place of poverty and the greater inequality to which Greeks are condemned by the European and the local elites. However, given that the European and local elites show no intention of allowing a referendum to take place, as they are very well aware of the fact that ―despite the massive propaganda campaign to create a kind of Orwellian truth, where ―war is peace,‖ or, in this case, ―unemployment and poverty is freedom‖― the result would surely be humiliating for them, the question is: what are the prospects for the future? To my mind, there are two possible scenarios ―scenaria‖: a) the Latin-Americanisation of Greece, and b) the setting of the preconditions for economic democracy, as part of an Inclusive Democracy.
The prospects for the future of Greece
a. The scenario of Latin-Americanisation of Greece According to the first scenario, the elites will push forward, no matter what, the present (and worse to come!) measures, which will lead to the LatinAmericanisation of Greece, a kind of Mexico within NAFTA, both at the political and the economic levels. In fact, there are indications that this process had already begun and it is funny indeed that some ―critics‖ of my proposal for an exit from the EMU already stressed that such a step would mean the ―Argentinisation‖ of Greece!
Thus, at the political level, Papandreou already behaves accordingly, and when for instance recently in Germany, begging Merkel for support, he had no qualms to respond as follows when asked to take a stand on the very offensive proposal made by German newspapers that Greece should sell some of its islands or national treasures to pay off its debt: ―There are more imaginative and effective ways of dealing with the deficit than selling off Greek islands,‖ and then he went on to explain these ways in terms of German investors investing on the ―green growth‖ of the islands! Clearly, this is a response that no self-respecting leader will make, apart perhaps from the Prime Minister of a Latin American banana republic. And then again, when a few days later he was begging Obama for support, he declared, full of admiration like the district governor of a poor region, his complete support for the US‘s ―fight against any form of tyranny and oppression‖ —i.e. to the mass crimes of the empire in Afghanistan and Iraq and the planned new crime in Iran!
At the economic level, implementation of the present measures will mean the continuation of present policies, rubber-stamped by PASOK, which is determined (despite the theatrical grumbling of some MPs) to vote on any bill proposed by the Leader, even a bill declaring that ―pigs could fly,‖ as long as they are kept in power, with all the financial and social benefits this secures for them. On this they will have the help of the docile trade union leaders close to them, who are ready to declare as ―illegal‖ any strike which creates problems to the elites, and, also, the decisive help of the mass media, particularly the TV channels, with the state-owned channels playing a leading role in distorting the truth in a Goebbelian way and in praising the ―Leader,‖ in a not too dissimilar way to the role of their counterparts in praising Ceausescu! And, of course, with the crucial help of the security forces in suppressing any kind of annoying dissent against the predatory measures.
Inevitably, poverty will grow as a result of the implementation of the ―stability program,‖ as the direct result of the severe cuts in civil servants‘ salaries and in public spending, which will be complemented by the indirect negative effects on income (through the multiplier) that, according to the Deutsche Bank predictions, would mean a decline in the GDP by 4% this year alone, whereas the total decline of GDP during the implementation of the program in the next three years would be in the range of–12% up to – 20%. Consequently, unemployment will become massive, as the already dismantled private sector has almost a null capability to absorb extra labour, whereas the traditional labour-absorbing sector, i.e. the public sector, will also become completely ineffective to continue this function in the future, as a result of the new measures. The combination of poverty and unemployment with the uneven effects of the increases in indirect taxes on low incomes will create even bigger inequality, in a country which is already among the most unequal countries in the Eurozone. The inevitable result would be the creation of a number of oases for the rich (locals and foreigners) in the midst of huge deserts in monster cities like Athens, where street gangs will shoot each other in drug wars ―exactly as it happens in similar cities all over Latin America at the moment! Of course this does not mean, as a Castoriadian put it recently, that ―the economic problem in Greece is political and is due to the corrupt and useless politicians, as well as to the institutional framework which promotes them‖ [55] with not a single word uttered about the socio-economic system, globalisation, and the EMU/EU ―presumably because it is just the imaginary significations of the Greek people which have to be blamed for the present crisis! Similarly, the exit from the crisis cannot of course be achieved through ―disobedience,‖ as the supposedly ―anarchist‖ Howard Zinn used to declare. Disobedience by itself could only lead to some improvements of the system or, at best, to easily suppressed insurrections but it would never lead, not it has ever led, to systemic changes. This brings us to the second possible scenario.
b. The scenario of setting the preconditions for an economic democracy as part of an Inclusive Democracy
According to this scenario, once the present measures are rejected through a referendum, and the immediate measures proposed above are implemented through the exit from the EMU and the Eurozone, a mass movement of self-organisation from below could develop and set the preconditions for self-reliance and economic democracy. Citizens could self-organise in every village, or neighbourhood, and begin building new institutions ―outside the internationalised market economy― and increasingly rely on them to meet their needs.[56] It is only through the general assemblies of the citizens in such institutions, that the real public interest could be expressed, in contrast to the existing institutions, within which only the special interests of political and economic elites, and the social groups dependent on them, could really be expressed ―an arrangement which has led to the current deep multi-dimensional and everworsening crisis.
Such a movement could proceed to the creation of: a) new politi
cal institutions where all the important decisions are taken by the assemblies of the demos, i.e. the citizens‘ body assemblies in a highly decentralised society (decentralisation needs to be only administrative in the first instance) , which could send recallable delegates (not ―representatives‖), with specific mandates, to regional and confederal assemblies for implementing the principles and values decided at the local level in relation to regional and confederal problems (Political Democracy),
b) new economic institutions based on the collective ownership and control of the means of production and distribution, which will be leased free to the ―demotic‖ enterprises (i.e. the enterprises which will be under the overall control of the demotic assemblies and will be self-governed through the assemblies of the employees in each enterprise). Such assemblies could implement the decisions included in a confederal plan for meeting the basic needs of each citizen, according to the principle ―from each according to ability to each according to need‖. Freedom of choice as regards the satisfiers for basic needs (the means to satisfy the basic needs) as well as the non-basic needs themselves and their satisfiers could be secured through an artificial ―market‖ (based on vouchers or on a demotic credit card system) that will replace the present market system (Economic Democracy),
c) new institutions for running each place of work or education based on self-management and the abolition of any differentiation of people according to gender, race, nationality or cultural and sexual identity (Democracy in the social realm) and, last, but not least,
d) of a society which will be reintegrated with nature, through the replacement of the present growth economy based on an eco-catastrophic consumerism by an economy geared to meet the real needs of the people in ways that do not put at risk the quality of life, if not life itself, as at present (Ecological Democracy).
The combination of these four essential components of democracy (political democracy, economic democracy, democracy in the social realm and ecological democracy) constitute what we call an Inclusive Democracy.
In conclusion, it is imperative that the anti-systemic Left, in Greece and in Southern Europe as a whole (the so-called PIGS!), directly challenges the present European integration in terms of markets and capital and establishes instead a new confederation of European Inclusive Democracies, as a model for the integration of European peoples as a whole, within a pan-European confederation of Inclusive Democracies, which consolidates the equal distribution of political and economic power among European peoples, and among all citizens within each part of the confederation.
[1] See Takis Fotopoulos, ―A systemic crisis in Greece,‖ The International Journal of Inclusive Democracy, Vol. 5, No. 2 (Spring 2009). http://www.inclusivedemocracy.org/journal/vol5/vol5_no2_takis_systemic_c risis_greece.htm
[2] See T. Fotopoulos, ―The global 'war' of the transnational elite,‖ Democracy & Nature, Vol. 8, No. 2 (July 2002).
http://www.democracynature.org/vol8/takis_globalwar.htm
[3] See Takis Fotopoulos, Globalisation, the Left and Inclusive Democracy (in Greek) (Athens, 2002), Ch.9, ―The consequences of the internationalisation of the Greek economy‖; see, also, T. Fotopoulos, ―Economic restructuring and the debt problem‖, International Review of Applied Economics, Vol. 6, No. 1 (1992).
http://www.inclusivedemocracy.org/fotopoulos/english/brvarious/restruct_ir ae_92.htm
[4] See, T. Fotopoulos, The Pink Revolution in Iran and the ―Left‖ (IJID, 2009) Ch. 5. http://www.inclusivedemocracy.org/journal/ [5] See Takis Fotopoulos, ―The end of the Green movement as a liberation force?‖ in ―The First War of the Internationalised Market Economy,‖ Democracy & Nature, Vol. 5, No. 2 (July 1999).
http://www.inclusivedemocracy.org/dn/vol5/fotopoulos_balkans_2.htm
[6] See Takis Fotopoulos, Dependent Development: the case of Greece (in Greek) (Athens, 1985 & 1987). [7] See my article ―Iran: The campaign for regime change in its last phase‖ (in this Issue).
http://www.inclusivedemocracy.org/journal/vol5/vol5_no4_takis_iran_last_p hase.htm
[8] Mats Persson , ―The real expenses scandal is in Brussels,‖ The Guardian (27/5/2009).
http://www.guardian.co.uk/commentisfree/2009/may/27/expenses-mepseuropean-parliament
[9] T. Fotopoulos, ―The myths about the economic crisis, the reformist Left and economic democracy,‖ The International Journal of Inclusive Democracy, Vol. 4, No. 4 (October 2008).
http://www.inclusivedemocracy.org/journal/vol4/vol4_no4_takis_economic_ crisis.htm
[10] T. Fotopoulos, ―A systemic crisis in Greece,‖ The International Journal of Inclusive Democracy, Vol. 5, No. 2 (Spring 2009).
http://www.inclusivedemocracy.org/journal/vol5/vol5_no2_takis_systemic_c risis_greece.htm
[11] T. Fotopoulos, ―Economic restructuring and the debt problem,‖ op. cit.
[12] ibid., Table 1
[13] ibid., Table 4
[14] ibid.
[15] Wolfgang Münchau, ―Greece can expect no gifts from Brussels,‖ The Financial Times (30/11/2009).
[16] The Financial Times (25/11/2009)
[17] OECD, Economic Surveys: Greece (1990)
[18] World Bank, World Development Indicators 2008, Tables 2.10 & 2.15
[19] As it is shown by a comparison of the Gini coefficients, ibid., Table 2.8
[20] T. Fotopoulos, Drugs: beyond the demonology of penalisation and the ―progressive‖ mythology of liberalization (in Greek) (Athens, 1999).
[21] Helena Smith, The Guardian (3/12/2007).
[22] Barnaby Phillips reporting in Al Jazeera (28/8/2009).
[23] Helena Smith, The Observer (27/9/2009).
[24] See e.g., Simone Troller, The Observer (25/1/2009).
[25] See the Athens daily Eleftherotypia (29/8/2009).
[26] See T Fotopoulos, The Global Crisis, Greece and the Antisystemic Movement (in Greek) (Koukkida, 2009), Part on [27] See the Greek ID network brochure on ―Racism as the inevitable symptom of hierarchical structures and relations‖ (in Greek) (July 2009). http://www.inclusivedemocracy.org/brochures/2009.7__ratsismos_antiratsi stiko_festival.htm
[28] Peter Mair, ―Huge influx of immigrants has changed Dutch society forever,‖ The Independent (5/3/2010).
[29] T. Fotopoulos, ―The myths about the economic crisis, the reformist Left and economic democracy,‖ op. cit. [30] See A. Carassava, ―Greece running out of patience with anarchy,‖ The Independent (11/12/2007) ; AP, ―Riots grip Athens on anniversary of death,‖ The Guardian (7/12/2009).
[31] See T. Fotopoulos, The Global Crisis, Greece and the Antisystemic Movement (in Greek) (Athens, 2009), ch. 12. [32] T. Fotopoulos, ―The drift into parliamentary totalitarianism,‖ The International Journal of Inclusive Democracy, Vol. 2, No. 4 (November 2006).
http://www.inclusivedemocracy.org/journal/newsletter/vol2_no4_parliament _totalitarianism.htm
[33] Alan Travis, ―Britain "sliding into police state'',‖ The Guardian (28/1/2005).
[34] See the Athens weekly Vema on Sunday (6/12/2009).
[35] Ian Traynor, ―EC to keep Greece under scrutiny,‖ The Guardian (4/2/2010).
[36] Helena Smith, ―Super-rich move billions out as debt crisis overwhelms Greece,‖ The Observer (7/2/2010).
[37] Source: Fitch; Olivetree securities, The Independent (6/2/2010).
[38] V. Georgas, Eleftherotypia (30/1/2010).
[39] P. Arestis & T. Pelagidis, The Guardian (1/2/2010); K. Vergopoulos, Εleftherotypia (29/1/2010) et. al.
[40] K. Moshonas, Eleftherotypia (14/7/2006).
[41] World Development Indicators 2002, Τable 2.5.
[42] See T. Fotopoulos, Dependent Development: the Greek case (in Greek) (Exantas, 1985), Table Γ3.
[43] World bank: World Economic Indicators ‘08, Table 2.3
[44] ibid., Table 4.1
[45] World Bank, World Development Reports 1980 & 1995, Table. 2
[46] ―Greek central banker among world‘s best paid,‖ Kathimerini (English edition) (23/10/2008). [47] See Taki
s Fotopoulos, Towards an Inclusive Democracy (London & NY: Cassell, 1997), ch. 6; The multidimensional Crisis and Inclusive Democracy (IJID, 2005), ch. 14 and "Transitional Strategies and the Inclusive Democracy project", Democracy & Nature: The International Journal of Inclusive Democracy, Vol. 8, No. 1 (March 2002) http://www.democracynature.org/vol8/takis_transitional.htm
[48] See T. Fotopoulos, Dependent Development: the Greek case (in Greek) (Athens, 1985).
[49] ibid. Table D1.
[50] Martin Feldstein, ―Let Greece take a eurozone «holiday»,‖ The Financial Times (16/2/2010).
[51] Erik Jones, ―Greece‘s capital account problem,‖ The Financial Times (11/3/2010).
[52] See Dirk Meyer‘ s Interview to newstime.gr on (8/3/2010).
[53] See T. Fotopoulos, ―Elections, crisis and popular trapping,‖ Eleftherotypia (26/9/2009).
[54] Helena Smith, ―Super-rich move billions out as debt crisis overwhelms Greece,‖ The Observer (7/2/2010).
[55] See G. Oikonomou, Eleftherotypia (5/2/2010). [56 ] See T. Fotopoulos, ―Transitional strategies and the Inclusive Democracy project,‖ Democracy & Nature, Vol. 8, No. 1 (March 2002). http://www.democracynature.org/vol8/takis_transitional.htm
Greece: the transnational elite"s “one way street”* TAKIS FOTOPOULOS The tragic events at the fire-bombed bank, during the recent huge demonstration in Athens against the savage measures imposed by the transnational elite (an ―unholy alliance‖ of the IMF and the EU), constitute neither a ―murder,‖ as it was hurriedly declared by the permanently and blatantly lying leader of the parliamentary Junta that governs Greece today (G. Papandreou), nor a ―provocation,‖ as the traditional Left permanently characterizes any event that it does not control. It was part of a popular counter-violence[1], within the logic of which it is unthinkable that it would aim at the death of oppressed employees (who had apparently been given a ―work or strike‖ ultimatum by their boss forcing them, as it was reported, to work in a building with no fire safety arrangements and behind locked doors). It was an (obviously irresponsible) act clearly directed against property. Such acts aiming at the property of fundamental capitalist ―symbolic institutions,‖ like a Bank, are far from rare in today‘s insurrections at global level, constituting spontaneous popular counter-violence against the systemic (economic and physical) violence. Particularly so, in a country like Greece in which systemic violence has taken such dimensions, which have led to the transformation of the post-junta parliamentary ―democracy‖[2] into a form of parliamentary Junta ― just one step before the formal suspension of basic human rights provisions in the Constitution. The reasons that could explain this transformation are as follows: