Monday, 11 January 2016

Greece and the Euro: A Marriage Made in Hell Part One

The initial mythology regarding Greece’s entry into the then named EEC (precursor to the EU) was that Greece would develop economically and become like the advanced countries of Northern Europe. It’s an irony of history that PASOK spent the 1970’s outflanking the KKE on the Left by marching on the streets with two key slogans: ‘Greece for the Greeks’ and ‘EEC and NATO are the Same’.  By the time the EUs single currency was wheeled out for  Greece  it was being de-industrialised and indebted at such a rate that when the IMF arrived it essentially went into a permanent coma for which it will never recover despite all the propaganda to the contrary (Stournaras ‘Grecovery’2014 and Syriza’s announced economic recovery autumn 2016).

The old Greek nation state was blown apart by a NWO transnational elite and turned into Europe’s first fully fledged debt colony tied to a currency that would usher in depression economics after the initial euphoria based on cheap credit with no sustainability linked to it in the long term. This isn’t a story of productively re-modernising a country but blowing it up and turning it into the economic equivalent of  Detroit in the Mediterranean, a post industrial post jobs hellhole where the walking dead scavenge in dustbins for food and have no reason to exist and so many have chosen not, committing suicide in the most public of ways. 1

Single Currency
The single currency is part of a wider capitalist neoliberal project based on the EU’s four core principles: freedom of movement in capital, goods, services and people. The aim of course is in creating a United States of Europe modelled on the USA.
The idea of a unified capitalist Europe is not new. It existed and was debated in the first two decades of the 20th century. 2 Nation states under capitalism had outlived their productive role and like the national companies of old, got gobbled up by bigger economic and military powers. The idiosyncratic history of Europe which saw wars as the solution to its differences, which led to two world wars, never managed to create a unified capitalist state and as noted by Lenin almost a century ago if it were to happen, it would be an ultra reactionary outcome. How can 28 EU nations with different languages, different histories and above all different levels of economic development be merged into one, without any democratic accountability or even agreement by the people that make up those same nations. Capitalism in its birth created the modern nation state. In its decay and decline it is blowing it up.

The 19 member Eurozone hasn’t as yet become 28 (total current EU members) but attempts are being made for that to occur. 3 With 9 non Euro currencies approximately a third of the EU the disparities in national minimum wages, levels of taxation, prices etc. are so large that the EU project is more like one of those large bananas one sees on  a Mediterranean holiday crashing in the sea when drunken revellers get on them and topple over.

From the moment the Soviet Union collapsed and East Germany was consumed by West Germany and the Ostmark was bought at a rate of 1 to 1 (when the real rate was around 1 to6) this cost was immense and would destroy the post war German economic miracle. Throughout the 1990s Germany run budget deficits and this cost would have to be borne by someone as the rules of the EU meant countries with the largest population had a bigger say and via the vehicle of Brussels the historic relationship of Germany and France (which was actually solidified during WW2) ensured that when the single currency was introduced, it would benefit the core, not the less economically developed periphery. The EU is not a charity. It is an economic big business empire. It would be a fallacy to believe that small countries like Greece would benefit one iota from joining it. 4

When Greece adopted the Euro at an exchange rate of 1Euro to 340Drachmas it meant everything produced in Greece was expensive and imports were priced cheaper. Greece entered at a high exchange rate much like East Germany. With cheap credit in the early years of the Euro it became cheaper to import and sell than to produce. This evaporated wages from the domestic economy due to layoffs and fuelled a debt import boom.

The moves towards the single currency were stillborn from day one, when the big three powers, Britain, France, Germany didn’t get agreement and sterling was crashed out of the ERM in the early 1990s, hence it never was a real single currency of a unified European Federal state. What was being attempted was political union ahead of economic and military (latter two had abysmally failed before) union. With the arrival of E Europe into the EU what we got was a single currency with remaining national currencies in a whole series of states. This in turn would trigger massive population movements West ie. to countries with ‘hard’ currencies, the Euro or Sterling ((UK opened its borders for instance to Polish workers before France and Germany did)

Goldman Sachs and the Euro in Greece
Greece was brought into the single currency by economic shenanigans the likes of which were organised in Brussels and Washington using the current Gods of finance Goldman Sachs. It wasn’t so much as requiring Greece to be in the single currency but ensuring it became a pole of attraction for cheap labour throughout the countries that border on to it which had had an anti-NATO past and Greece’s geopolitical location. Financial re engineering (infamous Swaps by the Simitis govt) and NATO go hand in hand. 5.One can only recount the destruction of Yugoslavia in the early 1990’s as a blueprint for what would happen next.  Like crack dealers in nightclubs the first drugs are free and once hooked on finance you would end up selling everything you own for nothing. An old tried and tested method pioneered from 19th century in the Opium Wars by Britain against China. Greece had nothing to gain from joining the single currency and everything to lose.

Low interest rates initially to encourage borrowing at the start of the 2000 decade then a tripling of them by the end. But with no real welfare state, bankruptcy would literally mean that, losing everything. The Greek population would pay the price of the profligacy of the banksters and their get rich schemes.

NATO and the Olympic Games
This is a story of a small country, like a local bar owner visited upon by the city boys of the mafia in a shakedown, who has to spend to be ‘protected’ otherwise the bar is smashed up. Not paying your fees guarantees instant destruction, paying eventually leads to economic destruction. Either which way one cannot escape the vice like grip of the globalist cartels. The smaller you are the bigger your problems.

Between 1974 and today Greece has spent anything between Euro 200-300billion in arms, being one of the largest spenders on earth. At the same time its secondary schools in the Greater Athens region are shared in two shifts (morning and afternoon) as not enough were ever built and as for hospitals even before the IMFs shock doctrine roadshow made its appearance, they were wholly inadequate to service the population. 6. Now they simply don’t exist for half the population at all. Like every banana republic in history, being sold submarines that don’t work by Germany only reaffirms the story that protection rackets always work with political elites that take pride in personal enrichment above all else. One can argue that is probably why they are in the neuralgic positions, as the saying goes excrement always floats to the top and it certainly did, in more ways than one.

Greece was the smallest country ever to take on board (Coca Colas) Olympic Games the financing of which crippled the Greek taxpayer in more ways than one (many Greeks were banned from working on Olympic projects as black market labour was favoured) being part of NATO it also meant due to previous agreements (matching Turkeys arms spending by 70%)  that it would be bankrupted mathematically once all the infrastructure projects had finished and no real benefits were accrued to the basic Greek economy of the Greek worker. 7 Infrastructure projects which emphasise only infrastructure for export led growth means modern ports but decrepid old hospitals.  Modern airports but no proper housing for the masses. Massive amounts of money were funnelled abroad by the rich who were bribed by foreign corporations for govt contracts (eg. infamous arms scandals by ex Defence Minister Tzohatzopoulos-PASOK and infrastructure Siemens contracts etc). In the same period of history Greek tourism which was a mainstay of foreign income in the 1980s’ and 1990’s saw a concentration of capital via the mass building booms of the early Euro years creating 4x hotels in many locations which were supposed to be filled by foreign tourists.
If Greece had remained with the Drachma it could have competed well with all geographic neighbours that had a local currency: Bulgaria, Albania and Turkey and non geographic like Italy (which didn’t have one!) The Wall St crash of 2007/8, the collapse of the dollar and the rise of the Euro as an alternative world currency led to significant price rises and any alleged gains from the Olympic and Euro football effect of 2004 disappeared in the 2000 decade and were only arrested after the Arab spring of 2011 (collapse of Egyptian, Tunisian etc. tourism), but not in any fundamental manner (despite the allegations of 24m tourists in 2014 tax receipts are down) as structural changes occurred in the tourist economy (less employees, more cheap labour with the advent of E Europe, bigger foreign owned hotels with all inclusive package deals etc.)

Eurocrisis Roadshow and the IMF
Papandreou was elected in 2009 with a big share of the vote in the mid 40%. By the time he was booted out his party had become a rump. His electoral promise was ‘We Have Money’ but he didn’t explain by that that he would raid peoples wages and pensions. His first act was to destroy the South Stream gas project from Russia and that indicated that he would then follow a clear American NWO path.

The US crash of 2007/8 was real, the costs of the double occupation of Afghanistan and Iraq were too much to bear with no actual dividends and this materialised in the US selling junk bonds to finance its deficits due to its role as the world’s ruling hegemon, leading to a global meltdown and the collapse of the dollar. By 2010 something had to be found to stabilise the flight from the dollar.  PASOKS leader Papandreou seems to have fitted the role neatly being a US citizen by birth. Like a used car salesman who can’t offload dodgy cars, he turned little Greece into a giant ATM for the global financiers. Suddenly the Greeks were the centre of all evil known to man, not Wall St or the City of London. The Greek plumber having forgotten to issue a receipt had turned the world economy to excrement.

Greece’s fiscal deficit for 2009 would be 12.7% of GDP double what the previous govt had projected around 6%. Then this same figure would be revised upwards to 15.4% using the Greek statistical services ELSTAT. 8 This made Greece number one in the EU, though not number one in total debt’s. It’s economy was never more than 2% of the whole of the EU and to allege the 2% created a Euro crisis is beyond a joke but that is what was sold by the corporate media who are part of the system of financiers.  Total EU debt in 2010 was around Euro 10 trillion Greece’s was in the hundreds of billions. Illuminating for anyone who wants to chart the rise and fall of the Dollar in relation to the Euro from 2008 till today is the fact that whenever the Euro appreciated too much we had an exacerbation of the Greek Euro crisis. Greece became the non-existent WMD of the Euro crash.

Bailout after Bailout to keep the Euro afloat
Three bailouts later the budget deficit is near to 200% of GDP (from 120%) and total Greek debts (domestic and external) are around Euro 1 trillion. Instead of alleviating the crisis, the Troika that took over just lit a fuse detonated the Greek economy. From around 13 banks we are essentially down to 4 and they are all foreign owned now. (December 2015)

Around 40% (official and unofficial) are unemployed, wages and pensions have had on average a 50% cut and the only discussion that ever exists is how low can everything go. Indeed. In an EU with different interest rates for Euro economies (negative in Germany +2% in bankrupt Greece) minimum wages which vary from +2000 Euros in Luxembourg to as low as 200 Euros in Bulgaria (or 150 Euros in non-EU Albania which has had open borders with Greece since 1992!) Greece has now been in depression for more years in ‘peacetime’ with the Euro than any other currency or probably nation in history. One cannot realistically call it a depression anymore but a programme of economic genocide.

Greece allegedly entered the EU to gain competitive advantage in Europe wide markets for its agricultural produce. Instead the exact opposite happened. The EU paid subsidies to Greek farmers to stop actual farming and flooded the supermarkets with cheaper non-EU agricultural imports. Hence the medium and small farmer went to the wall and the big farmer was just geared to exports and land even when not in use would be taxed to pay parasitical financiers. Steel, cement, shiprepairs etc production went to the wall and all the basic manufacturing plants of the 1970s (buses, armaments, fridges etc) were destroyed. Borrowing bank issued credit to stay afloat became the new unique selling point of politicians. Every bailout would save the Greeks and every new bailout would make the situation worse than the one before.

In the 2nd part of this topic we will look at the Euro and the main political parties, how they relate to it and what they propose in terms of the productive reconstruction of the devastated Greek economy and whether there can be hope within the Eurozone and the issue of Debt.

2.     “In this sense a United States of Europe is possible as an agreement between the European capitalists ... but to what end? Only for the purpose of jointly suppressing socialism in Europe…” Lenin
4.     Greece (EU Facts and Figures) Mice and Men
6.     Germany’s ‘hypocrisy’ over Greek arms spending

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