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Posts Tagged ‘Lucas Papademos

Austerity and debt, the proletariat and protest – 1

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Archbishop Ieronymos, the head of the Church of Greece. Photo: ekathimerini

A round-up of reports on austerity and debt:

‘Head of Greek Church questions austerity, troika’ – Archbishop Ieronymos, the head of the Church of Greece, has taken the rare step of writing to Prime Minister Lucas Papademos to express serious concerns about the effectiveness of the government’s fiscal policy and the effect it is having on Greek people. In his letter, Ieronymos also raises doubts about the role of the European Commission, European Central Bank and International Monetary Fund – or troika – in the country and whether Greece should agree to further austerity measures to receive its next bailout, suggesting that they are “larger doses of a medicine that is proving deadly.”

“Greeks’ unprecedented patience is running out, fear is giving way to rage and the danger of a social explosion cannot be ignored any more, neither by those who give orders nor by those who execute their deadly recipes,” he wrote. “It seems clear now that our homeland’s drama will not finish here but may take on new, uncontrollable, dimensions,” he wrote. “There are, at the moment, demands for even tougher, more painful and even more unfair measures along the same ineffective and unsuccessful lines as in our recent past. There are demands for even bigger doses of a medicine which is proving deadly. There are demands for commitments that do not solve the problem but only put off temporarily the foretold death of our economy. Meanwhile, the put our national sovereignty up for collateral.”

‘Greek debt audit campaign calls new agreements impoverishing’ – The new International Treaty and Memorandum, which accompany the ‘haircut’ of Greek public debt, push the Greek people further into impoverishment. They mean a dramatic drop in both living standards and working conditions, and enslave us to the state’s creditors. The reductions in pensions and wages, the abolition of collective bargaining legislation (contrary to Article 22 of our Constitution), and the 150 000 public sector redundancies lead to mass hunger and wages of 300 or 400 euros a month.

‘Tanzanian govt rejects IMF plan on minerals royalties’ – The government has rejected a proposal by the International Monetary Fund (IMF) to introduce a new system to calculate mining royalties because doing so would adversely affect tax collections. Had the government agreed to introduce the single royalty payment, the amount of tax the government collects from the mining firms would have dropped significantly.

‘Portugal unions slam IMF, EU’s “poverty agenda” ‘ – Thousands of protesters have taken to the streets of Lisbon to voice their opposition to government austerity policies. Unions organised the march in protest at spending cuts agreed in return for a seventy eight billion euro bailout. Armenio Carlos, the leader of the Confederation fo Portuguese Workers, said: “We are here to protest against exploitation, inequality and poverty. “That’s the agenda of the troika: the IMF, the EU and the European Central Bank.”

‘Hundreds of thousands rally in Portugal against austerity’ – Hundreds of thousands protested in Portugal Saturday against austerity measures ahead of next week’s talks with international creditors, with unions vowing to keep up the pressure. Officials from the so-called Troika — the European Union, European Central Bank and the International Monetary Fund — will next week evaluate progress on the country’s bailout programme. Demonstrators arrived in Lisbon from across the country in the rally described as one of the country’s biggest in three decades. Many were brandishing banners such as “The struggle continues” and “No to exploitation, no to inequality, no to impoverishment.”

‘Greece to pledge 20% cut in minimum wage, draft accord shows’ – Greece will pledge permanent spending cuts, including lower pension payments and a 20 percent reduction in the minimum wage, as the economy contracts this year at a faster pace than originally estimated, according to the draft of a new financing deal with the European Union and International Monetary Fund. “To restore competitiveness and growth, we will accelerate implementation of deep structural reforms in the labor, product and service markets,” according to the letter of intent addressed to IMF Managing Director Christine Lagarde in a document obtained by Bloomberg News.

[With thanks to the Bretton Woods Project for its compilation of these reports.]

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Of German wurst, French fries and an IMF bullet

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A closed chips stall called 'La Reine des Fritures' ('The Queen of French Fries') in French Flanders. Photo: Stephan Vanfleteren / Panos Pictures

Le Monde Diplomatique, that fearless critic of globalisation and the tyranny of the multilateral lending institutions, has said in its 2011 December issue that in November, the Franco-German directorate of the European Union, the European Central Bank and the International Monetary Fundthe ‘troika’ — were furious when the Greek prime minister, George Papandreou, announced plans to hold a referendum.

Absolute oligarchs dislike referendums because the idea has a great deal to do with consultation – not a favourite subject for the IMF in the 67 years it has claimed to shape the global economy. That is why, summoned to Cannes for an interview during a summit that his country was too small to attend, kept waiting, and publicly upbraided by Angela Merkel and Nicolas Sarkozy (who were responsible for exacerbating the crisis), Papandreou was forced to abandon the plan for a referendum and resign. His successor, a former vice-president of the ECB, promptly decided to include in the Athens government a far-right organisation banned since the Greek colonels lost power in 1974.

In ‘Europe in crisis, rule by troika’, Serge Halimi has written in LMD that the European project was supposed to secure prosperity, strengthen democracy in states formerly ruled by juntas (Greece, Spain, Portugal), and defuse “nationalism as a source of war”. But it is having the opposite effect, with drastic cuts, puppet governments at the call of the brokers, and renewed strife between nations. Everything, in short, that the IMF and the World Bank have pursued since 1944 mostly successfully in Asia, Africa and South America.

Former bankers Lucas Papademos and Mario Monti have taken over in Athens and Rome, exploiting the threat of bankruptcy and the fear of chaos. They are not apolitical technicians but men of the right, members of the Trilateral Commission that blamed western societies for being too democratic. “Having crushed Greece and Italy, the EU and the IMF have now set their sights on Hungary and Spain,” Halimi has written, and it is a grim warning.

A ferris wheel runs in the centre of Brussels next to an old building advertising Martini and Zanussi. Photo: Stephan Vanfleteren / Panos Pictures

Red Pepper has more on the ways and means of the IMF.

“It’s stripped millions of people of their livelihoods, but the global economic crisis has brought one institution back from the dead: the International Monetary Fund. Two years ago, the IMF looked to be on its last legs. It had got to the stage where nobody wanted to borrow its money. Many developing countries started accumulating reserves to avoid ever having to go to the IMF loan shark. Developed countries in trouble would go just about anywhere – China, Russia, Saudi Arabia – to avoid the IMF.”

Then came the meltdown. “The IMF failed to see it coming – pretty damning for a body supposed to oversee global financial stability – but bankrupt countries suddenly had no choice but to come begging.” Exactly the point – the IMF did see it coming because this is what its prescriptions for the previous decade were aimed at in the first place. In April last year, the G20 pumped the organisation with £330 billion of new funds. Uruguayan writer Eduardo Galeano called the decision ‘black humour’, saying it would ‘rub salt in the wound’ of countries hit by a crisis they did not create. The IMF is now re-armed and doubly dangerous, with large new areas in what was formerly the Eurozone to subjugate.

Not quietly by any means. After all, the Greeks are Greeks first and then, perhaps, Europeans. Ditto with the Italians, Portuguese, Hungarians, Spaniards and Latvians. It is looking rather like the Germans and the French (elite, mind you, not the labour, the unemployed, the migrants and the armies of informal workers struggling on 25 euros a day) are the last Europeans left.

But this is why major protests have been convulsing Greece throughout the autumn with strikes, and occupations of the main squares in many towns. Civil servants blockaded their ministries, preventing ministers from accessing their departments in September and October. The early November surprise announcement of a popular referendum in Greece on the EU-IMF loan terms and conditions would have marked the first time an IMF lending package was subjected to a test of popular ownership. In the end the political pressure heaped on the Greek prime minister by other European countries, the Greek political opposition and factions from within his own government forced him to back down and resign as prime minister.

After the collapse of the Greek government, Elena Papadopoulou of the Athens-based Nicos Poulantzas Institute said: “Despite the proclaimed enthusiasm, there is no realistic reason to believe that the new coalition government – with the participation of the extreme right – will follow anything other than the socially destructive policies applied according to IMF recipes with the agreement of the European elites.”