Alex Lantier
After Greece’s newly-elected Syriza government repudiated its
campaign pledge to write off Greek debt, European officials pressed
Greek Prime Minister Alexis Tsipras to continue imposing unpopular
austerity measures in order to repay Greece’s creditors.
When
Tsipras visited Paris yesterday for talks and a joint press conference
at the Elysée presidential palace, President François Hollande insisted
that Greece submit to European Union (EU) demands. “Dialog between
Greece and its European partners must go forward so as to reach
agreement,” he said, adding that Athens should “respect European rules
which apply to all, France included, and engagements that were taken on
debts that are of importance to governments.”
This was a signal
that Paris, which holds €42 billion of Greek debt as part of the
European bailout mechanism, opposes a write-off of Greece’s €320 billion
debts.
French officials made clear prior to Tsipras’s visit that
Paris fully supports the basic thrust of the policies imposed in Greece
by the EU, led by Berlin. “There is no point in playing euro zone
countries against each other, and especially not France and Germany,”
French Finance Minister Michel Sapin said Monday. “A solution that helps
Greece while making sure it meets its commitments will have to go
through an agreement between France and Germany.”
For his part,
Tsipras hailed the Socialist Party (PS) government of Hollande, whose
austerity measures have made him France’s most unpopular president since
World War II. “We are not a threat for Europe,” Tsipras declared at the
joint press conference with Hollande. He called on France to be a
“protagonist for a change of policy in Europe.”
Since it won
elections on January 25, Syriza has sought to reach an accommodation
with European banks for a modification of the terms of repayment for the
debt that the country owes. The party, which speaks for a section of
the Greek bourgeoisie and rests on broader layers of the upper middle
class, has repeatedly insisted that it accepts the entire framework of
the EU and is determined to pay back Greece’s debt in some form.
In
particular, Syriza has rejected any appeal to the mass opposition to EU
austerity among workers in Greece, France and across Europe. Its appeal
is entirely directed to the European banks and their political
representatives.
These appeals, however, are falling on deaf ears.
The EU views with contempt the opposition to austerity among the Greek
people that underlay the vote for Syriza. Yesterday, a German government
memo leaked to Reuters prior to a “euro group” meeting of EU finance
ministers, made clear Berlin will not tolerate the slightest improvement
in workers’ living standards. Instead, it demanded that Syriza impose
rapid new cuts to jobs and social spending, of the sort that have bled
Greece white over the last six years.
“The euro group needs a
clear and front-loaded commitment by Greece to ensure full
implementation of key reform measures necessary to keep the program on
track,” the memo stated. “The aim is the perpetuation of the agreed
reform agenda (no rollback of measures), covering major areas as the
revenue administration, taxation, public financial management,
privatization, public administration, health care, pensions, social
welfare, education, and the fight against corruption.”
According
to the memo, Berlin will demand that Greece run a budget surplus of 4.5
percent of its Gross Domestic Product (GDP). This would mean that nearly
€10 billion per year would be sucked out of Greece’s devastated
economy, in order to pay off its creditors.
Yesterday, the
European Central Bank (ECB) also banned the use of Greek government debt
as collateral for loans sought by Greek banks saying that “it is
currently not possible to assume a successful conclusion of the program
review.”
Greek Finance Minister Yanis Varoufakis has proposed that
Athens raise €10 billion by issuing short-term Treasury bills to
provide “bridging finance” over the next three months while a new
long-term debt agreement is worked out. Unless some sort of financing
measures are established the government could be hard pressed for cash.
“This
is clearly the ECB signaling to the Greek government. You’re going to
have to talk to [international lenders] and get a deal. Otherwise,
really bad things are going to happen,” said Jacob Kirkegaard of the
Peterson Institute for International Economics.
Varoufakis
traveled yesterday to Frankfurt to meet ECB chief Mario Draghi.
Varoufakis abased himself before both Draghi and German Finance Minister
Wolfgang Schaeuble, one of the leading architects of austerity measures
against Greece.
“We established an excellent line of
communication that gives me great encouragement for the future,”
Varoufakis said at ECB headquarters. “I am now proceeding to Berlin,
where I am extremely eager to meet not with just the finance minister,
but with the intellectual force behind the project of European monetary
union, Mr. Schaeuble. I look forward to it.”
Varoufakis said
Berlin could count on Syriza to go further than previous right-wing or
social democratic governments in Greece. “I will try to be as charming
as I can in Berlin,” Varoufakis declared. “I will tell Mr. Schaeuble
that we may be a left-wing riff-raff, but he can count on our Syriza
movement to clear away Greece’s cartels and oligarchies, and push
through the deep reforms of the Greek state that governments before us
refused to do.”
“Deep reforms” is a reference to measures aimed at
opening up the Greek economy more fully to European and international
capital.
Speaking to the German weekly Die Zeit,
Varoufakis called Greece a “bankrupt country” and said that Syriza would
ask major international financial institutions to help determine its
policies. “We’ve approached José Ángel Gurría, the secretary general of
the OECD [Organization for Economic Cooperation and Development], the
organization of industrialized countries. He is supposed to help us put
together a reform program,” he said.
Syriza is opposed to the
only possible progressive settlement to the euro crisis: the repudiation
of the Greek debt and the expropriation of the banks by the European
working class. Instead, amid rising exploitation and anger in the
working class reflected in the outcome of the Greek elections, it is
promoting illusions in reactionary governments across Europe.
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