Lawlessness and crisis in Greece while Portugal begin bailout talks

Lawlessness and crisis in Greece while Portugal begin bailout talks

As the Greek government struggles to enforce austerity on its protesting citizens, Europe's bankers whisper about the possibilities of never getting their money back and its likely consequences.

As hard as the Greek government might try to push the costs of this crisis onto its citizens, the Greek working class are having none of it.

On top of EU discussion about whether the government will default on their debt or not, the Greek working class are continuing their protests against austerity.

In the early hours of April 14th, in the Athens suburb of Keratea, locals furious over the building of a new landfill site dug a two-meter deep ditch across the Lavriou Highway, leading to Keratea – permanently blocking traffic. Hours later, scuffles broke out with police who rushed to the spot. Athens' top police officer has also recently asked for his men to be removed from the area.

"There is clearly a breakdown of the rule of law, and without the rule of law there can be no economic development," said political analyst Takis Michas.

The refusal of austerity by Greek workers has seen thousands sign up to the "can't pay, won't pay" movement. In reaction to this, the government is announcing reductions of up to 50% in road toll fees. As the nation struggles to rein in a debt of €340bn, the logic of appeasing protesters – an estimated 8,000 Greeks a day were refusing to pay tolls – has outweighed antagonising them further. "Our hope is that this will calm things down," the deputy transport minister Spyros Vougias said.

Greece has also seen numerous strikes, occupations, demonstrations and riots, all of which are causing many to wonder if Greece is becoming ungovernable.

Haunted by a recession that has exceeded even the worst predictions of the EU and IMF almost a year after they moved to rescue the country with their bailout last May, austerity has hit Greece as never before. Last week it emerged that hospitals were facing severe shortages of beds and supplies while schools could no longer afford cleaners. Disposable incomes have dropped dramatically as wages and pensions have been slashed, taxes have been raised and unemployment has reached a record 15%.

Eighteen months after the economic crisis erupted, Papandreou said last week that more cuts were needed to meet deficit-cutting targets

Portugal
Meanwhile, talks to negotiate Portugal's bailout are due to begin in Lisbon. Representatives of the European Commission, the European Central Bank and the International Monetary Fund are meeting Portuguese authorities on Monday to discuss what would be the eurozone's third bailout since the global economic crisis.

The negotiations, which are expected to last weeks, will set the terms for what is expected to be a $116bn deal.

Jose Manuel Barroso, head of the European Commission and a former Portuguese prime minister, has said it "will be a medium-term programme with strict conditions".

The aim is to come up with a radical economic reform plan, including privatisations, labour market reforms and steps to shore up fragile banks by mid-May, weeks before Portugal is due to hold a snap election.

Portugal itself has also seen an increasing wave of protests with strikes on the Lisbon subway in recent weeks as well as demonstrations across the country organised through the Facebook which attracted over half a million people.

The Portuguese government is now facing added pressure from Finland, where the anti-EU True Finns party, made big gains in an election on Sunday. Timo Soini, the party's leader, said that there would "have to be changes" to the bailout plan.

It may take weeks to know whether the party can back up that threat, but its success in the election potentially poses a huge risk to Lisbon, which has said that come June, it will run out of funds to keep the country running.

Any delay in approving the bailout deal beyond the mid-May target could leave European leaders scrambling to find other means of funding for Portugal.

The EU and the IMF have each warned that Lisbon will have to implement more public spending cuts, tax rises and far-reaching privatisation to secure its lifeline. The debt rescue is already highly controversial in Portugal, where unemployment has been increasing for almost a decade and education levels are below th eurozone average.

'Defaults' and their consequences
A default is when a country misses a repayment on its debts. This would probably lead to investors shunning a country's debt, making it hard for the government to borrow.

If Greece is unable to push the cost for their economic crisis onto the working class this could lead to them defaulting on their debt. What the EU's policymakers are scared of is that the German and French banks would declare massive losses. Also, Portugal (and possibly Ireland) might default on their debts.

The last major default on a national debt was Argentina in 2001 which resulted in massive protests across the country.

Comments

Ed
Apr 18 2011 14:46

So had a go at sticking this together as I came across a few interesting bits of reading one after the other and thought I'd put this together as something to start off a discussion about the situation in Europe and where it could go.. bare in mind I'm also trying to straighten out some economics in my head (not my strong point but thought I'd learn best through doing, innit..)..

Basically, it looks like the Greek government are having a rough time making Greek workers bare the brunt of the crisis and people are starting to talk about them not being able to pay their debt/possibly having to restructure their debt (not sure what this means really, though poss shifting the burden up the social ladder?)..

Anyway, if Greece defaults then they think Portugal and Ireland might do the same. Dunno why Ireland would as I've not seen much fightback from workers their, probably more likely in Portugal though..

This seems like it'd be fairly serious for the EU as a whole and could possibly touch stuff off across the region. So, for instance, I stuck the thing in there about Argentina partly as my own fantasy but also coz I'm interested in whether people think that two or three defaulting nations in Europe could lead to something similar region-wide.

I'm asking like, I don't really know what the effects would be but it seems that hundreds of billions of Euros just disappearing from bank vaults would cause governments to get really tough with this austerity business and then, well.. fuck knows really..

Would really appreciate some feedback (especially massive disagreement)..

Indigo
Apr 18 2011 16:30

I've found myself following Paul mason's blog around a lot of this stuff recently and it makes for interesting reading, from what i can tell its a sticky situation for the euro-zone, as the strong German recovery looks like its beginning to overheat (seeing growth in some sectors comparable with china, with inflation that is beginning to hit the German voters) whilst Portugal, Ireland, Greece and Spain are stagnating or shrinking still, something's going to have to give seeing that they're all held under the same currency policy . With the recent hike in interest rates to try to head-off northern european inflation the european central bank have more-or-less torpedoed any hope of the pigs nations growing their way out of debt. Effectively the northern european ruling class have hung southern european governments out to dry, forcing them to make unprecedented austerity measures against their populations to preserve the interests of the northern european bourgeoisie, as far as I can tell this whole mess relies on the pigs governments having the ability to force austerity on their workers, something that's looking increasingly questionable. if one or more of the pigs default, the consequences could absolutely (in my opinion) lead to region wide unrest as it would force another huge austerity push in northern europe as governemnts would need to reassure the markets that thier banking sector can handle the scale of the losses that would be incurred by one default let alone two or more. Its certainly worth keeping an eye on, if it all wasn't so complicated/depressing

Jim Clarke
Apr 18 2011 20:51

As Indigo says Paul Mason has been pretty good on this. It would be cool if he could post up his thoughts. wink

subprole
Apr 19 2011 01:30

I've found this disgusting (but nonetheless interesting) article from a fucking bastard called Takis Michas (a politician from the liberal "Democratic Alliance") which seems to reflect the paranoia inside the Greek ruling class and the most reactionary parts of the petty bourgeoisie about proletarian deliquence in Greece and is primary a call for heavy (police) repression:

http://online.wsj.com/article/SB10001424052748703385404576258422215326318.html

Quote:
Athens Descends Into Anarchy
The real Greek disease is contempt for the law, and the political failure to combat it.

By TAKIS MICHAS

Athens

Greece's public debt may reach 150% of GDP this year, an alarming possibility that has captivated outside observers. But in the final analysis, the major issue confronting Greece may not be its solvency, but its governance.

The country is at the mercy of militant activists who are inspired by various factions of the hard left. The heaviest hitters are Greece's Communist Party and the anarcho-Stalinist Coalition of the Radical Left, which is composed of the Ecosocialists of Greece, the "Roza" Radical Left Group, and the Internationalist Workers' Left, to name a few. With total impunity, their followers have taken to harassing citizens and destroying public property—even taking over whole villages.

In one case last year, a group of militants badly beat a former center-right New Democracy minister in front of television cameras. No arrests were made. In another case, a group of thugs accosted a leading Greek journalist while he ate in a restaurant. A similar incident happened last month, the victim that time being a minister of the governing Panhellenic Socialist Movement. No arrests were made in those cases, either. In May 2010, three employees of the private bank Marfin suffocated to death when a hard-left mob firebombed their offices during a riot. Again, no arrests.

Then there are the various movements of "civil disobedience" organized by Greece's hard left. These include the "Den plirono" ("I won't pay") phenomenon, which amounts to supposedly brave refuseniks lifting barriers at motorway toll-booths and driving through without paying. This, even as their co-ideologues destroy bus and metro-ticket machines.

These acts of theft and vandalism have also gone unpunished, though to combat fare-dodging on public transport, the government has dispatched a new team of inspectors. This week one of them was shot twice in the stomach by a bus passenger, and he remains in critical condition.

Last summer, the Communist Party organized hundreds of union members to block tourists from boarding ferries to Greek islands. Yet even after the courts ruled that the move was illegal, no arrests were made.

Is it any surprise, therefore, that there exist today areas of Greece where the government no longer exercises sovereignty? One such area is the village of Keratea, near Athens International Airport. Keratea's inhabitants, supported by anarchist "freedom fighters" from the greater metropolitan area, have been engaged for two months in near daily pitched battles with the police, using firebombs, stones and rubble. Their complaint is the government's decision to construct a landfill near the village.

"If the Keratea model becomes accepted as a method of protesting," writes Alexis Papahelas in the daily Kathimerini newspaper, "then the country will enter a very disquieting phase."

What stands out in all these incidents is the authorities' inability or unwillingness to enforce the law. "Even if we arrest them, they will be out in no time," a police officer in Athens told me on condition of anonymity. "Their political patrons will see to it."

Many argue that Greece's disintegration is the unavoidable consequence of the government's attempt to enforce fiscal austerity. This seems doubtful. This meltdown can be seen as the product of the totalitarian left's open attempt to exploit the economic crisis and destroy Greece's existing democratic and economic institutions. What we are witnessing is not a descent into chaos, but a descent into organized lawlessness. Sowing pandemonium and forcing Greece to default will, according to Greek Stalinists' analysis, bring the revolution nearer.

What makes the situation worrisome is not so much the political strength of this movement. After all, the Communist Party and the Coalition of the Radical Left together claim no more than 13% popular support.

The problem, rather, lies with the political and ideological passivity of the parties that do represent Greece's broader middle classes. The tolerance these democrats have shown toward their totalitarian counterparts has allowed the latter to play a leading role in shaping Greek public discourse. Do they imagine the favor would be returned if the Coalition of the Radical Left were in charge?

Unless Greece's political elite realizes the seriousness of what's happening and acts now to re- establish the rule of democratic law, their efforts to deal with Greece's economic problems will have been in vain.

Mr. Michas is the international secretary for Greece's new centrist-liberal party, the Democratic Alliance.

Gerostock
Apr 19 2011 01:49

Ah yes, capitalism's myopia and addiction to short-term gains has given them another big existential problem. I cannot think that an intelligent person (and these ECB bankers seem to be sharp people) would have looked at the Greek political situation in 2010 -- radical, furious, and violent -- and decided to attach to a necessary loan the sort of structural adjustment scheme designed for highly repressed third world countries.

Capitalism can be quite stupid sometimes.

bastarx
Apr 19 2011 03:46

LOL at that article. I'm looking forward to the day when the bourgeoisie of every state is whining about such lawlessness.

Caiman del Barrio
Apr 19 2011 09:01
Jim Clarke wrote:
As Indigo says Paul Mason has been pretty good on this. It would be cool if he could post up his thoughts. ;)

Presumably he'd condemn TEH VILENZ... roll eyes

Mark.
Apr 19 2011 09:04
Quote:
Is it any surprise, therefore, that there exist today areas of Greece where the government no longer exercises sovereignty? One such area is the village of Keratea, near Athens International Airport. Keratea's inhabitants, supported by anarchist "freedom fighters" from the greater metropolitan area, have been engaged for two months in near daily pitched battles with the police, using firebombs, stones and rubble. Their complaint is the government's decision to construct a landfill near the village.

The latest news from Keratea:

AFP

Quote:
Battle lines were literally drawn near the rural town of Keratea where residents opposing the waste disposal project dug a trench on a highway that has seen countless clashes with riot police since December.

"It is a form of guerrilla warfare where residents feel their honour is at stake," a riot policeman stationed in the area told Ta Nea daily on Saturday.

"Sometimes our opponents even include police officers who live in the area," he added. "Their property is at stake, so they try to protect it."

Early on Friday morning, the home of a local police station commander was attacked with firebombs that destroyed three cars parked outside.

That same night, Keratea residents carved a 1.5-metre (four-foot) trench across the highway that has been the main battle zone of the protest.

The highway to Lavrio, a port servicing several Aegean islands, is already severed with roadblocks patrolled by locals who routinely fight riot police in the surrounding fields, pelting them with rocks and Molotov cocktails.

Over 200 police are stationed in the area on a daily basis in an operation that has cost the state more than a million euros ($1.45 million), Ta Nea said...

Truce reached in Keratea

Quote:
Hundreds of riot police officers are to be withdrawn from Keratea, southeastern Attica, where residents have been violently protesting plans for a landfill and locals are to dismantle a four-month blockade, it was agreed on Monday in talks between the local mayor and Citizens’ Protection Minister Christos Papoutsis.

Papoutsis agreed to start withdrawing police from the area on the condition that locals who have been manning barricades on the main road outside the town since December also move away from the area…

From the Greek Streets

Quote:
As announced a few hours ago, the ministry of citizen protection announced its plan to withdraw all police forces from Ovriokastro and Keratea. It has also been decided that the construction machinery will be withdrawn from the area and that the ministry of environment will enter into negotiations with the municipality.

At 17.08 GMT+2, the largest part of the riot police forces had withdrawn from Keratea.

There is a feeling of victory running across the barricades of Keratea as the police buses leave. Is this a victory for the people of Keratea? Or a tactical move on the side of the government, ahead of the easter break?

More information as it comes.

ocelot
Apr 19 2011 09:43

It should be noted that the true lawless class in Greece most responsible for the fiscal crisis is the capitalist class who refuse to pay a pennyworth of tax to a heroic degree. No amount of police repression of working class demonstrators will provide the kind of challenge to this lawlessness that might make a difference in Greek state finances. Not that I'm advocating a balancing of the state finances as a desireable outcome in any way. Just pointing out the class hypocrisy of Michas's (and the Democratic Alliance's) line. Even if, in some bizzarre parallel right-wing universe, Greek workers and supporters of the various "anarcho-Stalinist" left that Michas rails at, were to stop resisting and meekly file back to work (if there even was work) for reduced wages etc, this would not affect the basic financial crisis of the Greek state (NB also, despite the lies in the German media, Greek wages are on average a mere 2/3rds those of the German average, amongst some of the lowest in the EU).

Having said all that, the financial crises of the Peripherals, is more to do with the flows of investment money from the core countries in the 1999 - 2007 period, in search of higher returns than available in the (then relatively underperforming) core. That money was invested in various apparently profitable, but ultimately risky, schemes (Irish & Spanish property bubbles for e.g.) that went belly up in the global crash. Now the core banks want the populations of the peripheral countries to pay for their losses. A commentator on R4 the other morning made the comment that the giant Citibank in the US (which had to be bailed out by the US govt. after Lehman) was legally licenced in Delaware. What's happening at the moment in the Eurozone, is the equivalent of the US government saying that the citizens of Delaware would have to pay for Citibank's losses.

Now the bourgeois economic commentators in the FT (Wolf, Münchau, etc) may point out that what is happening is a contradiction between the Eurozone's monetary union without fiscal union. There is an element of truth in that, but there's a more political perspective, which is that the Eurozone is currently constituted like the common currency areas of the old Gold standard-era empires. The idea that the needs of the Indian, African or even Irish populations of the Sterling zone would be put on an equal footing with the parliamentary electors of GB, was, naturally, never on the cards. Similarly the right-wing politicians of Germany, Finland, etc, find it more convenient to tell racist fairy tales to their own electors about the origins of financial crises in the peripherals, to do with our supposed laziness, fecklessness, lack of good protestant work ethic, etc, rather than the incompetent investement decisions of their bankers and pension fund managers.

The boom and bust cycle of capitalism requires periodic losses of capital, the imperial dynamic is to try and create captive 'dumping grounds' to absorb some of these losses and the contradictions they express.

Either way, the fight in the Eurozone between peripheral and core is a natural result of the capitalist contradiction between economic and socio-political forces and is not going to go away any day soon.

Mark.
Apr 19 2011 20:20

An interesting article from ESE on the situation in Greece:

Spanish version ------ machine translation

ocelot
Apr 20 2011 13:07

Good in what sense? Would 2m euros worth of damage be twice as good? Can antagonism be commodified? Would it still be good if our main criteria were similar to these?:

Quote:
Meaningful action, for revolutionaries, is whatever increases the confidence, the autonomy, the initiative, the participation, the solidarity, the equalitarian tendencies and the self -activity of the masses and whatever assists in their demystification. Sterile and harmful action is whatever reinforces the passivity of the masses, their apathy, their cynicism, their differentiation through hierarchy, their alienation, their reliance on others to do things for them and the degree to which they can therefore be manipulated by others - even by those allegedly acting on their behalf.

If so, how?

subprole
Apr 20 2011 15:10

Ocelot, where did I write something about the costs of the damage? So, would you please first explain what is "sterile and harmful" or "reinforcing the passivity of the masses etc." when this vending/validating machines where destroyed? If proletarians can use the metro for free now (at least for a while) because no one is able to buy tickets it was definitely a useful action. It was also a proportional reaction to the raise of ticket prices in Athens.

Ed
Apr 20 2011 15:16

Just to say, I agree with subprole.. this isn't like when I was living in Brighton and sometimes local anarchists would vandalise cash machines. This is part of a massive non-payment campaign going on in Greece at the minute, people are refusing to pay for buses, trains, motorways, all sorts..

Ocelot, could you explain your opposition to this action?

ocelot
Apr 20 2011 20:15

There is no opposition. There is simply the question, why is this "good", given that the only information offered was:

Quote:
On the evening of April 19th, small groups of anarchists entered the metro stations of Sygrou-Fix and Halandri, in Athens. As corporate media report, they destroyed all vending and validation machines in both stations – the damages are estimated in “the hundreds of thousands, possibly up to 1m euros”, as the media report.

No mention of price rises of tickets, non-payment campaigns, etc. in the above. Only the information quoted from which, unfortunately, my crystal ball was not able to provide me with a solution to the mystery of its meaning.

Feel free to provide links or information regarding fares struggles, etc.

Harrison
Apr 21 2011 07:50

has any1 got any info about how close the keratea anarchists are with the locals?
they seem unusually appreciative of the anarchists (for obvious reasons).

i've seen a few vids, and the riot police seem to treat the locals indicriminately from the black clad anarchists, beating them just as badly. so perhaps thats why they are so close

BTW, i hope eveyone has seen this
http://www.occupiedlondon.org/blog/2011/01/17/474-nine-year-old-boy-writes-school-report-on-the-keratea-riots/

piper65
Apr 23 2011 18:34
Ed wrote:
So had a go at sticking this together as I came across a few interesting bits of reading one after the other and thought I'd put this together as something to start off a discussion about the situation in Europe and where it could go..

Hey, thanks for posting this.
I'm looking for sources of information about what's happening in Europe and it would be great id you could share the articles you got this information from, any news site or blog I should be watching. Anyone that can help men and point out anything useful too, I would really appreciate it. Thanks