Tuesday, July 7, 2015

Troika and EU tensions grow after Greek vote

Stephen Morgan

“We don’t want to be a German colony.”   Pablo Iglesias, Spanish anti-austerity leader

Obviously today's meeting between Greece could be decisive, but it isn't sure if an agreement will be reached or not. However, splits are clearly developing among the EU leaders. A meeting between Merckel and Hollande yesterday failed to come to an agreement on how to proceed, with France wanting concession and Germany remaining adamantly opposed.

There are now two blocks with differences beginning to show through, dividing Northern Europe and Southern Europe - France, Italy and Spain want a deal which helps Greece avoid collapse and stop an exist from the Euro, while Germany with the Northern European countries will not give in. If their differences become even more public, that itself will undermine the concept and viability of the European Union with people across the EU.

What worries both sides, however, is that should the Greeks be seen to succeed following the incredible referendum result, workers in other countries like Spain, Italy, Portugal and Ireland may say “enough is enough” and anti-government and anti-EU movements could grow into mass movements with a leftist character, imitating SYRIZA, like we already see with Podemos - whose name meaning “We can” would quite well sum up a mood among the masses to believe that they can also get concessions from EU and stop the austerity measure -  pushing even bourgeois politicians in these countries to enter into new negotiations with the EU and ECB.

On the other hand, these countries' economies are now growing, but big social problems remain. That might lessen the likelihood of big movements, or, on the hand, as often happens, when workers see an improvement in the economy, a movement can begin to take back all they lost in the recession, demanding increases in wages, job security, social serves and employment.

I think Trotsky once said that revolutions don't necessarily happen when a country is in deep recession, but it is more likely as the economy improves. In the depths of a severe economic crisis, workers, without leadership, become physically and mentally exhausted by the circumstances, especially if followed by a defeat. They concentrate all their efforts and activities on keeping themselves and their families alive. They need time to recover and reorganize in order to go back on the offensive again. It is also a period of reflection, and aborbing what has happened. More layers of workers will then begin to see that capitalism is a bankrupt system. Therefore, a new self-confidence arises in the working class  and new movements can begin over economic and social and issues, but also quickly develop into a more general assault on capitalism.

In Greece at the moment, we have a confirmation of what also has already been said long ago - that defeated on the industrial front, workers may then move into a political front. The union leaders led the Greek workers up the hill and down again with endless one-day General strikes, which, when not escalated into all-out General strikes, meant that it burnt off all the anger and determination of the workers, and gave them a certain feeling of hopelessness over what to do next - leading to a lull in the industrial struggles over the last year or two. Given the opportunity to fight back politically they answered the EU with a massive No.

Perhaps, what may follow the referendum is also a new shift back to industrial action action, and possibly a sort of widlcat, all-out, popular General strike could take place which pushes the useless national union leaders aside, with local grass root activists and shop stewards taking over leadership of the fight.

I'm not sure this will happen, but I believe it is one variant worth taking into account.
Perhaps, it might be worth calling for a new movement, which brings activists and local workers' representatives into some sort of rank and file "Oxi-movement" as a way of organizing post-referendum actions from below?

Coming back to the economic situation in Greece, one thing I hadn't thought of is that, behind the scenes, Germany and its block could be planning to force Greece out of the Euro, calculating that the re-introduction of the drachma would result in an even greater economic catastrophe, thus making Greece an example to other countries of what might happen if they follow the same path.
One other thing has crossed my mind, and the Greeks have not mentioned , is, could Greece operate with a dual currency, such as exists in countries like the Lebanon, Zimbabwe, Uruguay, Panama, and other smaller countries.

As I understand it, that means ordinary transactions at home, including payment of wages, would be made in drachmas, while people would be allowed to hold private Euro accounts and international trade would also be made in Euros.

In some countries that seems to work, but in others it hasn't. But I'm not an economist, so I can’t tell the feasibility and consequences of it. Could this be a transitional step to ease the problems of going back to the drachma? I have no idea, and I think it would be good if we were to ask Michael Roberts' and Mick Brooks this. Both these economists have material on this blog especially Roberts.

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