From the TUC

The Greek election result demands our solidarity

02 Feb 2015, by Guest in International

Syriza’s spectacularly successful election campaign was described as being about hope. The Greek people have shown faith in that campaign. Their courage, their defiance and their optimism have given us a true lesson in democracy in the country that invented the system so many centuries ago. They face a huge struggle now, and they will need our solidarity.

To understand this dramatic election result, we need to reflect on what led to it. The country’s conservative elite cooked the books when Greece entered the Eurozone in 2001. The growth that followed was propped up by capital flows from northern Europe seeking to invest their savings and surpluses.

Then the mother of all crises hit and Greek government debt became unsustainable. The PASOK government adopted two rounds of austerity measures, in exchange for a £90 billion EU rescue package. The austerity measures ranged from VAT hikes, pension cuts and a lowered minimum wage to the undermining of collective bargaining and the usual menu of neo-liberal economics. This sparked national strikes and protests by our brothers and sisters in the trade unions and the public at large.

Those austerity measures failed on their own merits, as the IMF have now admitted, but led to unemployment rates over 25% and youth unemployment over 50%. Meanwhile, the country’s debt carried on growing. In 2011 EU countries wrote off 50% of Greek debt, but only in return for further austerity measures.

Prime Minister Papandreou suggested putting that deal to the people in a referendum, but then retracted and subsequently resigned. Many Greeks saw this as the final proof that their country had been occupied, their government supplanted by the infamous troika – the European Central Bank, International Monetary Fund and  European Commission.

Another bailout plan followed and the 2012 elections saw anti-austerity forces grow, as did the Nazis of Golden Dawn.  Such parties are a morbid symptom of austerity and the damage done to society by the troika. Indeed, this is a party whose leadership has been convicted for money laundering and being part of a criminal organisation.

So after four bailout packages, Greece’s debt to GDP ratio stands at 174% – nearly twice the rate in Britain.  And a major part of the reason is that austerity has shrunk the Greek economy by 25%. No one denies that the Greek economy needed treatment – tax evasion by the rich and professional classes, elite corruption in public sector contracts and jobs – but the medicine prescribed has been killing the patient.

Inequality has soared, while big wealth has remained virtually untouched. Austerity was for ordinary people, while the rich benefited from tax cuts on their properties. In 2011, even the IMF accepted that tax arrears amounted to nearly half of the country’s budget deficit.

This is the background to Sunday’s election result. Until Sunday, the term Greek tragedy was justifiable. But now the Greek people have chosen hope rather than resignation and submission to neoliberal politics and austerity economics.

Syriza’s programme, outlined by its leader in Thessaloniki last September (and in discussion with the TUC just a year or so ago in this very building) calls for a “European New Deal” of public investment, to be financed by the European Investment Bank. That is precisely what the European Trade Union Confederation calls for in our “New Path for Europe”, backed by the TUC and trade unions across Europe, including the German DGB.

Syriza called in September for exactly the quantitative easing (QE) that the European Central Bank started last week, demonstrating that what ‘experts’ declare impossible one day can be reality the next.

Syriza’s call for a European conference to discuss what to do about the debt echoes the help that was provided to Germany last century, and their proposal to tie loan repayments to growth would give Greece’s creditors a real stake in restoring the health of the Greek economy.

The leaders of Syriza have stressed that they are ready to negotiate and build the broadest possible alliances in Europe, unlike the previous Greek government that seemed intent on building an alliance only with their paymasters

They have also pledged to meet Greek trade union demands for restoring salary levels and pensions to provide social justice and increase demand. Other commitments included free electricity and meal subsidies, reinstating a Christmas bonus, free medical care for the uninsured and free public transport for the long-term unemployed.

They are committed to tackling tax evasion and corruption, which are still endemic.

The challenges will be immense, and the Greek people, their trade unions and their Government will need our solidarity. We need to build a popular movement to overturn austerity in Europe and also in Britain – indeed, ending austerity here in Britain could be the best thing we can do to help Syriza and the Greek people.

We also need to back the government and the people in tackling Golden Dawn, which has lost support significantly since the European Parliament elections, and been forced below their level of support in the 2012 general election, although they have still secured a worrying 6-7%.

Syriza’s ability to reverse austerity – and the social crisis it has caused – will depend on maintaining public support in Greece, and on the support we can mobilize around the rest of Europe. But the Greek people have embarked on a new path – one that clearly rejects austerity and puts the people, not the markets, centre stage.

This blog post is an edited version of a speech delivered on 28 January 2015.