Support to the Greek people’s resistance against the dictatorship of creditors!


The new austerity plan released on Sunday 2 May is a disaster for the Greek population: for workers in the private as well as the public sector, retired people, or the unemployed, i.e. those deprived of a job. Here are some of the measures it involves:

  • Freezing of wages and retirement pensions in the public sector for five years;
  • Suppression of the equivalent of two months of wages for civil servants;
  • The main VAT rate has moved up to 23 % after 19 and 21%;
  • The other VAT rates have also increased (5 to 5.5% and 10 to 11%);
  • Taxes on fuel, spirits and tobacco have been raised by 10% for the second time within a month;
  • Early retirements (related to stressful work) are prohibited under 60;
  • The legal age for women’s retirement will be raised from 60 to 65 by 2013;
  • The legal age for men’s retirement will depend on life expectancy;
  • 40 full years at work (instead of 37, outside study periods and unemployment) will be required to be entitled to a full retirement pension;
  • This pension will be calculated on the worker’s average salary over the years instead of the last salary (which means a net curtailing of 45 to 60%)
  • The government will reduce its operating expenditures by EUR 1.5 billion (which means less money for education and health care);
  • Public investments will also be reduced by EUR 1.5 billion;
  • A new minimum salary for youth and long-term unemployed is set up (i.e. the equivalent of the ‘CPE’ that TUs and young people rejected in France).

This is a windfall for financial markets !

  • Transports, energy and some regalian services will be liberalized and opened to privatizations;
  • The financial sector (mainly banks) will benefit from a funds set up with the help of the EU and the IMF;
  • Flexibility of workers will be increased;
  • Layoffs will become easier;
  • The Greek economy is now controled by the IMF.

Since Greece is part of the euro zone, it can neither devalue its currency nor play on interest rates. Its debt cannot be restructured either since European financial institutions hold 2/3 of it. These same banks will further borrow from the European Central Bank (ECB) at a 1% rate in order to make loans to govenments (against interests). As a counterpart to the above measures, countries in the euro zone will lend on an individual basis some EUR 100 to 135 billion over 3 years to Greece at a rate of 5% (45 billion in 2010). Rich countries and banks will thus make money on the Greek people. Christine Lagarde, French minister of finance, forecasts a profit of EUR 150 millions a year. This will increase the public debt of the Greek state so that it can pay back its speculating creditors !

The Greek crisis is an illustration of the danger represented by the IMF, the EU and finacial markets.

Rightly disparaged for its disastrous structural adjustment programmes, the IMF resurfaces in the euro zone euro after wrecking the economy of several Eastern European countries for two years. It uses the same methods as before, still adapted to the same partners: financial markets and TNCs. Today like yesterday its true nature of arsonist fireman is highlighted. The EU and its Commission too have reasserted their paradigms in the service of an open and undistorted competition. The ECB does not serve the peoples of Europe but banks and financial institutions. After precipitating the Greek crisis via rating agencies payed by major US banks, the financial markets try to derive even larger profits from their speculative strategies. The PASOK government, the European Union and the IMF provide them with a golden opportunity.

Behind the financial industry we find manufacturing, trading and services transnational companies.

While we rightly condemn speculative funds, rating agencies and the financial industry, we keep in mind that they are but part of a greater whole. This unbridled speculation that chokes deprived populations has only been possible for two major reasons:

  • successive deregulation of financial markets since the 1980s;
  • the choice made by the management of large companies to ‘invest’ their profits in speculation instead of production and employment. Such accumulation of profits originates in a new distribution of wealth that benefits shareholders to the expense of wage earners. Over 25 years their respective share diminished by an average of about 10% of the GDP in developed countries. This economic trend, which corresponds to the neoliberal ideology, is the main cause of the economic and financial crisis we experience today.

The various governments that have succeeded each other over the past 30 years in Greece as in other countries of the North, also bear a heavy part of responsibility in the increasing public debts. Tax policies in favour of more affluent households and corporations (taxes on income, fortune and corporations) have significantly reduced budget revenues and increased public deficits, which has led the States to go into more debts.

Those who organized the crisis are spared while the people must pay the bill.

In the PASOK–EU-IMF austerity plan imposed on the Greek people, we only find ludicrous inefficient measures towards some tax justice and no measure whatsoever to counter tax evasion of corporation benefits. The so-called solutions set forward by PASOK, EU and IMF push Greece towards an ever deeper crisis. A minimal recession amounting to 4 points of the GDP has already been predicted for 2010. Small craftsmen and traders as well as small companies will be faced with bankruptcy. Unemployment will explode, and the purchasing power of lower and middle classes will plummet. Inequalities will increase and basic human rights (access to water, energy, health care, education…) are under threat for the more deprived portion of the population.

The Greek people’s anger is ours too. CADTM fully supports all mobilisations against the austerity plan.

Alternative solutions are possible !

  • The repayment of Greece’s public debt must be immediately suspended and a public audit must be organized to determine whether it is legitimate or not.
  • Cancellation measures must be taken and the financial return on the debt must be taxed at the maximum income tax rate.
  • Tax measures can be taken immediately to restore tax justice and fight tax evasion.

_ According to the accounts of the Greek Treasury civil servants (pointed out as scapegoats) and workers declare higher incomes than such professions as chemists, lawyers, GPs, or than bank managers! Almost all corporations (including shipowners) declare their benefits in countries with a more favourable tax system (such as Cyprus) or hide them in tax havens. The Orthodox Church still benefits from exorbitant tax cuts on its movable and immovable property. There is money in Greece, but not where the austerity plan wants to find it!

At CADTM we declare our solidarity with the Greek people that will go on strike on Wednesday 5 May. Everywhere in Greece as in other European countries solidarity through mobilization must become more manifest. Greece is under attack today but we all know that tomorrow it will be Portugal, Ireland or Spain, and the day after all the euro zone may be affected, including its ‘richer’ countries.

We rejoice at the first declarations of solidarity and the first support mobilizations in front of Greek embassies. We must go further!

The whole European social movement must stand next to the Greek people! European populations can only win from a common protest! CADTM will be part of it !

Translated by Christine Pignoulle



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