Tuesday, July 14, 2015

The Third Time Is the Charm

2010-- The government of Greece is bankrupt and cannot service it's sovereign debt.  The economy is near collapse.  First bailout memorandum, familiarly known as the Kick-The-Can-Down-the-Road Memorandum is agreed to.  Economy continues to contract.

2012-- The government of Greece is bankrupt and cannot service it's sovereign debt, most of which is owned by commercial and private financial institutions.  The economy is near collapse.  Second bailout memorandum, familiarly known as Eat-Shit-And-Die Memorandum is agreed to.  Commercial and private financial institutions balance sheets are rescued.  Economy is that much nearer to collapse.

2015-- The government of Greece is bankrupt and cannot service its sovereign debt, most of which is now owned by the official institutions of European and international capitalism, the ECB, the governments of Germany, France, Italy, Spain either directly or through the EFSF, whose last active program was the assistance program for Greece, which expired on June 30, 2015.  EFSF continues to exist but only to service the bonds it issued to bankroll its operations and its assistance programs, receive payments, and maintain continuity as the ESM takes over all responsibility.

The Greek economy has effectively collapsed.  Tsipras, the Prime Minister and leader of the Syriza party establishes a referendum for the Greek people to reject the "last offer" of the EU lenders, vowing that "the day after the referendum, negotiations will resume," and "the bigger the 'NO' vote [on those previous terms] the better the terms [of the new agreement that results from the new negotiations]."

Tsipras is, and has been, in so far over his head he has to look up to see the bottoms of his own shoes. Tsipras appeals for a third bailout.  Instead he receives and supports an "agreement", familiarly known as the Hung-By-the-Neck-for-Our-General-Amusement-Agreement, that may, if certain conditions are met, possibly lead to a third memorandum.  Oh boy, can't wait for that.

2015-- Tsipras, who's penchant for self-aggrandizement is matched and supported by an astounding inability to accurately evaluate social forces and "economic outcomes,"  states that while he does not "believe in" the new memorandum, he will implement it; that he signed the agreement in order to "avoid disaster for the country," which of course has suffered catastrophically from the previous memorandums; that he has no plans to resign, and that the the terms of this agreement "were milder" than those of previous agreements. 

Well, taking his "personal plans" first in dealing with this topsy-turvium  pathology of Tsipras', it doesn't matter what he plans, as has been so made so painfully clear to the most casual observer.  He doesn't plan to resign?  That's nice.  And irrelevant.

Reports are that ANEL, whose seats gave Syriza the majority necessary to form a government will vote against the agreement when it reaches the floor of the Hellenic Parliament.  Now the vote on this agreement will be one of the two most important votes the parliament has taken since January 26, 2015, the other being the vote of July 10, so I expect a good half-dozen or so of Syriza MPs, including Varoufakis will have personal matters of a higher priority demanding their time, and won't attend the session.  And another good half-dozen or so will actually find the nerve to vote "no."  

The KKE and the Fascists are sure "no" votes, so Tsipras's faction in Syriza will be dependent upon "yes" votes from PASOK, and New Democracy. This vote, no matter which way it goes is a vote of confidence in the Syriza government with all votes meaning "no confidence."  Tsipras is done. Gone.  Cooked. Maybe he gets a severely reduced pension, but we can hope not. 

Now as to this current agreement being "milder" than the last pre-referendum offer.  This agreement commits the Eurozone, the IMF, the ECB, the ESM to absolutely nothing.  This "agreement" is a set of pre-conditions that Greece must satisfy before negotiations towards a new MOU can even be initiated.  So we cannot compare the terms of this agreement to the terms of the last proposal made by the Troika prior to the referendum.

This is more than a technical detail, but more than technical details have never been exactly the strong point of Syriza's administration. 

What the agreement does require is that the Greek government modify the VAT to suit the demands of the Troika. 

What the agreement does require is long term, comprehensive reform of pensions to the satisfaction of the Troika.

What the agreement does require is that the Greek government comply with the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, which stipulates that government deficits cannot exceed 3% of the GDP and that government debt does not exceed, or is sufficiently declining towards [emphasis added] 60% of the GDP.

What the agreement does require is full implementation of that same treaty such that automatic spending cuts are triggered in case of deviations from targeted primary budget surpluses.

What the agreement does require is changes to pension laws to offset the cost of the decision by Greece's Constitutional Court in 2012 declaring illegal the cutting of benefits to those who received both main and supplemental pensions, an estimated "clawback" by the EU from Greece of €1.022 billion.

The agreement does require implementation of OECD "Toolkit 1" to "enhance" competitiveness in various retailing and merchandising sectors with the application of OECD "Toolkit 2" anticipated for the manufacturing sector.

The agreement does require privatization of the country's electricity transmission network.

The agreement does require "reform" of labor markets to comply with "European best practices" when it comes to mass dismissals and layoffs.

The agreement does not require the transfer the transfer of €50 billion in national assets to a privatization fund, in that pre-valuation of assets prior to market sale does not satisfy the demand to fund this special facility to the €50 billion mark from the sale of assets.  The €50 billion realized from the sale of assets having as yet unknown total costs, pre-crisis notional value, or any other measure, will be used to "pre-refund" the debt occurring from any new memorandum and recapitalizing the banks (€25 billion), decreasing the debt/GDP ratio (€12.5 billion) and "investments" (€12.5 billion).

The agreement does require the review of legislation, with the exception of the emergency humanitarian package, enacted by the Hellenic parliament since February 20, in order to amend any laws that "backtracked" on previous commitments.

These are the "minimum requirements" that Greece alone must fulfill before any negotiations for debt relief, extended terms, additional funds provided by the ESM can take place. 

So there are no new terms that are milder than in previous agreements, because there are no terms of any agreement.  There are minimum requirements placed exclusively upon Greece before any negotiations regarding any possible agreement will even be entertained.

Now all the PhDs in the world-- the Leos, and Sams, and Hans, and Yannis-- can try to spin this as an "undefeat."

All the idiot movie-reviewers, semi-socialists, and friends can plead that Syriza, poor little Syriza was overwhelmed because life and systems and computer networks and writing code are just too complicated for anybody other than--well, themselves, when up until now everybody else was arguing that those same computer networks made it so much easier to "manage" socialism, to really match production to need (see Cockshott's works).

All those who yesterday proclaimed that the job of revolutionists, Marxists, etc. was to join Syriza "in order to keep it honest" can pretend that joining Syriza was anything ever than the dishonest effort to pre-empt the prospects for social revolution.

The institutions of European capitalism know better.  They know blood when they smell it.  They know victory when they taste it.  And the blood of the people of Greece is the taste of victory in the mouth of the Troika.

July 14, 2015


  1. Richard7:30 AM

    This comment has been removed by a blog administrator.

    1. Sorry, had to remove a name to protect the un-innocent.

      Rest of comment was: "That is breathtakingly strong, sharp and spot on..."

  2. Anonymous11:23 AM

    S. Artesian,

    I would like to hear your thoughts about why do you think that the alternative you are proposing ( repudiating the debt) is better considering the status-quo? Repudiating the debt means being kicked out from the EU, reintroducing drachma, hence, inflation wiping out savings, a further drop in foreign investment, social turmoil, tourism sector's deterioration and so on. Politically Syriza would be wiped out as well, economically it is very like that it would be much worse as well. How any of this seems like a solution or any better than carrying on with memoranda?

    Doesn't truth lie in that a solution to the current Greek crisis doesn't lie within Greece and currently there doesn't exist a solution (movement) capable of solving this problem?

    I am asking this genuinely.

  3. And I'm answering genuinely-- please read the posts on Greece starting with:


    And then if you still genuinely believe that There Is No Alternative, well then I've failed and explaining why I regard repudiating the debt the ONLY POSSIBLE alternative (and just the preliminary step) will be pointless.

    I will add here and now this: Imagine that what if Syriza had not been elected?

    Imagine it had remained a minority, opposition party, and a coalition govt. of PASOK and New Democracy were in power, negotiating with the Troika. And suppose that government gave all the same answers that Syriza and its supporters have been giving: "It's the best we can do; we must stay within the Eurozone; it will be disaster if we repudiate the debt because we're isolated; we have no choice; there is no alternative." ??

    What do you think Syriza's response would be then, under those conditions?

    What do you think the "left's" response would be to the PASOK/ND bleating?

    What would your response be?

    So now, what's the difference? Because Syriza pretended it could cut a better deal? Actually, it couldn't and it didn't; and if it's a better deal you wanted then you should support PASOK/ND.

    It really is just that simple. genuinely

  4. Anonymous12:25 PM

    I've read your all of yours posts on Greece.

    My position with regards to austerity, whether implemented by PASOK, ND or Syriza, is essentially the same - in the context of neoliberal capitalism, austerity is objectively the only option available, short of a revolutionary movement in the countries where finance capital is concentrated (Germany) or a mass movement in Europe at large. Either this or austerity, no?

    I might have missed where you explained it in detail, but whenever someone brought you an argument (that you quoted) that a repudiation of the debt would lead to worse outcomes, I only happen to recall you saying that life in Greece is already horrible. But the point is that a default - or more significantly: reintroduction of drachma - might not lead to a better choice economically let alone politically (collapse of Syriza, rise of Golden Dawn, increase in Russia's geopolitical influence, a fracturing EU (which, mind you, is precisely the institution which could provide some coordination for communist movements trans-nationally etc).

    Ultimately my question is this - of course repudiation of the debt is the only (preliminary) step to be taken, but it could only ever make sense if other conditions are met, i.e. if revolutionary movement able to support Greece exists outside Europe. It doesn't and that's why leaving the EU might end up a disaster. Where would you disagree with this view?

  5. Everywhere.

    The first post I wrote on Greece put the terms, and issues, and conditions in terms of class struggle, class relations, concluding that Syriza was a capitalist formation, whose program would fail, and would only accelerate the collapse of the economy, the suffering in Greece, and its own capitulation.

    This is not seeking better conditions in a death camp. Tsipras thought he had "leverage" when facing the Troika because he thought they would never tolerate Greece leaving the Eurozone. Tsipras had as much leverage as a sonderkommando in Buchenwald. You want better conditions in the death camp? I don't. I think we're better off without having sonderkommandos "mediate" for us with the SS, pardon the analogy, and that we need to build an above ground and underground organization that can advance the class interests of workers.

    Any effort spent supporting Syriza, rallying for Syriza obscured and obscures the fundamental class issues posed in Greece: capitalism, or --not socialism yet because that requires an international revolution--but the struggle against capitalism, and against the governments that want to be the sonderkommando.

    Repudiating the debt only makes sense if a revolutionary movement exists to support Greece? Hmmh....well that settles that. You can make the same argument about ever attempt the working class has to struggle against capitalism. You can say the same thing about the Russian workers movement: "Sure withdrawing from WW1 is the necessary step to be taken, but it could only ever make sense if a revolutionary movement able to support that step pre-exists us throughout the world."

    The point being NOT that conditions in Greece were equivalent to the conditions in Russia. Precisely not. The point being is that you can make that argument at any time under any conditions because the revolutionary movement is never developed enough until IT IS, and it only gets to the IS state, because workers somewhere, maybe Paris 1871, maybe Saigon 1937, and again 1945, maybe Chile 1973, stop listening to those who say "conditions aren't ripe." And when they do listen to people who argue in the midst of the collapse of old economic and social power that conditions aren't ripe, the workers die. And their families too.

    A revolution does not occur overnight. It requires a bit or organization, and system, but the question WASN'T whether or not workers could seize power in Greece, but were the material relations of property and labor such that workers had to confront the prospects and the necessity of seizing power? The answer to that is clearly "YES" and so support for Syriza was more than a waste of time, more than illusion, it only strengthened the privation forced upon the workers.

    So I think genuinely, you're offering an argument made in bad faith.

  6. Anonymous1:34 PM

    First off, I don't support Syriza and I when debating with people who defended it as "socialist" or what have you, I always stood on the side which argued against Syriza. I always supported extra-parliamentary revolutionary movement or prospects of building one, which Syriza made it more difficult to do by channelling the energy and attention through the parliament. My support for Syriza or lack thereof has nothing to do with this debate.

    Secondly, when talking about "conditions being ripe" you are dealing with abstractions. The difference between Russia in 1917 and Greece in 2015 is that Russian working-class existed when communism was a real thing, when it was a spectre haunting the world. Greece exists in the absence of ANY revolutionary movement. After all, Russian Revolution degenerated and ultimately collapsed because of a failure of German Revolution, did it not? Chile is also a different case in so far as Chile was somewhat self-sufficient considering its natural resources, it had Cuban support, potential USSR support and leftist movement all over Latin America. Greek situation is fundamentally different from any of situation of 20th century. It is absolutely not the same as Mensheviks prattling of conditions not being ripe for the revolution in Russia. My heart is absolutely with the working-class, with the communist revolution, but simply and unfortunately, a revolution in Greece right now is simply infeasible. That is precisely why I asked how your alternative is any better. I mean, you can shout "revolution", you can denounce everyone who doesn't agree with you as counter-revolutionary, you can talk in any platitudes you want, but the question still remains unanswered - how would Greece defaulting be a better option for the prospects of a global revolution CONCRETELY?

    Quite frankly, my intention was not to start a debate on these lines, but to simply get your views regarding the difficulties with regards to a Grexit. At least you recognise it contains difficulties, right? So that's my point in a nutshell - what about these difficulties?

    1. So we agree? Syriza is a capitalist formation? Syriza should not be supported by a workers' organization, a Marxist party, or any group opposed to the perpetuation of capitalism?

      If we agree on that, what is the argument? I ask that, genuinely, because here's what you said in the first message on this string:

      "I would like to hear your thoughts about why do you think that the alternative you are proposing ( repudiating the debt) is better considering the status-quo? Repudiating the debt means being kicked out from the EU, reintroducing drachma, hence, inflation wiping out savings, a further drop in foreign investment, social turmoil, tourism sector's deterioration and so on. Politically Syriza would be wiped out as well, economically it is very like that it would be much worse as well. How any of this seems like a solution or any better than carrying on with memoranda?

      Doesn't truth lie in that a solution to the current Greek crisis doesn't lie within Greece and currently there "

      See, the "solution" I was proposing was not simply repudiating the debt, but repudiating the debt, plus no confidence in the Syriza government; plus organizing workers around seizing workplaces; plus participating in community and neighborhood councils providing medical and essential social services; plus no forwarding of funds from municipalities to the national government; plus no privatizations; plus expropriation of "absentee" capitalist personal property; plus no funding for the military; plus democratization of the armed forces; plus...plus....plus.

      Your argument appears to be consistent in that you consider getting kicking out of the EU the worst thing that can happen. If that's the case, then you should be for the government, ANY government, to try and negotiate the best deal it can, no? Which to me means-- either support Syriza, or supporting PASOK/ND, right? Do you know of another party that argued it could negotiate better than those three, obtaining a better outcome?

      A revolution is never "feasible" until it is. By that I mean, the breakdown in capitalist accumulation and the concomitant attacks on living standards, wages, workers is not synchronized necessarily with the "consciousness" or organization of the working class. So the issue is NEVER is Greece "ripe" for a revolution, but what steps must be taken so the working class can "catch up" to the events, the movement of capital, and defend itself with organizations that can lead it to power. That's a long term project. Some opportunities are better than others. But not working towards that goal because if the current government gets defeated or booted out of the Eurozone "things could get worse" is precisely, and has been proven again by events in Greece to be the "non-starter."

      Repudiating the debt is what the workers need to do, no? It's raised as part of a total agitational/action program. It doesn't exist separate and apart from the other elements, including withdrawal from NATO, no funding of the military, immediate democratization of the military with the officer corps removed from command and control functions, workers guards to protect immigrants from fascist attacks.

      I don't think there's anything more difficult than the revolutionary reorganization of society, given the incredible levels of destruction that the bourgeoisie will inflict on the means of production, living and accumulated, once VALUE production is no longer feasible. That's the most difficult thing there can be. I don't see any way to avoid those difficulties. I see no way to avoid the difficulties Greece would encounter by being forced out of the Eurozone. So what? This is not a question of "choice." It is one of social necessity, what the working class must confront and overcome in order to break the cycle of destruction.

    2. As for "how would Greece defaulting be a better option for the prospects of a global revolution CONCRETELY?"

      Are you kidding me? Why do you think the Troika took the hardest of hard lines, squeezing Tsipras with the threat of Grexit?

      Because it new that if an example wasn't made of Tsipras, an example wasn't made of Greece, that the sluice gates would open and not only would the events in Greece overtake Syriza, but events in Spain, Ireland, Portugal, Slovenia-- everywhere would overtake the "authority" of the EU, the "power of the debt."

      The Troika understands uneven and combined development as the material substance of permanent revolution much better than Tsipras of most Marxists do. They knew what they had to do. They took the measure of Tsipras and knew him to be lacking.