Spanish stocks fell sharply on Monday amid fears that a number of regional governments will ask Madrid for financial support. The falls come after Spain’s IBEX index fell by nearly 6 percent on Friday when Valencia, a region on Spain’s southern coast, said it would seek financial support from the central government.
Spanish 10-year borrowing costs rose sharply to trade around 7.5 percent having traded below the key 7 percent mark just days ago.
Over the weekend media reports indicated Murcia, a small region to the south of Madrid would be the second of Spain’s 17 highly indebted regional governments to seek aid. Speaking in a local newspaper, the head of Murcia’s local government Ramon Luis Valcarcel said he hoped to tap government funds.
Government employees in Madrid hold signs reading ”This is a hold-up” during a demonstration against the Spanish government’s latest austerity measures. (AFP Photo/Dominique Faget)
[What few have realized is that due to the Libor Scandal, the banks have no more money, regardless of what Ben Bernanke prints. Paper is just paper. There is nothing behind it. The balance sheets of all the banks are nothing but zeros. The 1% already removed the gold, silver, and they own claim on all the real estate in the world now. The only thing that humanity can do is stage a global revolution. Game over. Realty starts now. - my comment]
Hundreds of Spanish firemen, police officers and nurses marched yelling through the streets Monday, denouncing as “robbery” the pay cuts enforced under Spain’s latest fiscal emergency plan.
“Hands up, this is a robbery,” cried protestors as they blocked a major thoroughfare in central Madrid in a demonstration organised through messages on social networking sites such as Twitter.
The latest protests erupted after Prime Minister Mariano Rajoy last week announced new pay cuts and tax increases, aiming to save 65 billion euros ($80 billion) in order to lower the public deficit.
Spain is suffering its second recession in four years, with an unemployment rate of more than 24 percent.
Cuts to public budgets are already affecting services such as schools and hospitals and critics say Rajoy’s new austerity measures will worsen economic conditions for ordinary people.
Among the latest steps is a cut in the Christmas bonus paid to civil servants, equivalent to a seven-percent reduction in annual pay.
“It’s intolerable. The problems of the Spanish state don’t stem from civil servants… It’s unfair and shameful,” said nurse Miguel Contreras, 28, who came to protest in the capital Monday from the central Castilla-La Mancha region.
“There are hospitals with whole floors that are not being used because they are firing and cutting jobs. We have little hope, but staying sat at home would just make it easier for the government to keep on doing what it wants.”
Thousands of people protested on the streets of Madrid on Friday after the government approved the measures, and again on Sunday evening, when they marched to the parliament where access was blocked by riot police.
Introduced by a conservative government under pressure from the European Union to stabilise Spain’s public finances, the latest measures also raised value-added sales tax, with the upper limit rising from 18 to 21 percent.
“These measures will ruin Spain. We don’t consume, we don’t shop anymore. We have to hit the streets, we can’t just sit there,” said regional government worker Angeles Carrasco, 57.
Spain’s two main unions, UGT and CCOO, have called for a day of demonstrations on Thursday.
CCOO leader Ignacio Fernandez Toxo said on Monday that a general strike later was “inevitable” if the government maintained the austerity plan. This year has already seen one general strike, in March.
Unions have called for the protests to be peaceful but clashes broke out on the fringes of some demonstrations in Madrid last week, including a major march by striking coal miners on Wednesday.
Small groups of protestors threw stones and police fired rubber bullets, beat some protestors with batons and made several arrests.
Spain will this month become the fourth eurozone country, after Greece, Ireland and Portugal, to get bailout funds when it receives the first tranche of a 100-billion-euro kitty for its banking sector.
The bailout has annoyed ordinary Spaniards who feel their banks are being rewarded while they endure cuts.
The axing of the bonus for civil servants came on top of an earlier pay cut in 2010, after which their salaries were frozen.
“We can’t buy presents and food at Christmas,” said Maria Garcia, 50, an administrative worker for the regional government who attended Monday’s demonstration during her half-hour morning coffee break.
“If the vacuum cleaner breaks, you have to clean with a broom.”
SYRIZA and the way forward
June 25, 2012
The conservative New Democracy party will lead a new government in Greece after two stunning elections in which it barely defeated the Coalition of the Radical Left, or SYRIZA, a coalition of left-wing parties and organizations committed to tearing up the “Memorandum”—the former government’s commitment to drastic austerity measures that have plunged Greece into a depression and slashed working-class living standards.
SYRIZA skyrocketed from minor party status to win 16.7 percent of the vote in the May 6 election, and 26.9 percent on June 17—outpacing other left options, including the Communist Party and the smaller anti-capitalist coalition ANTARSYA. Frighteningly, the neo-Nazi Golden Dawn also did well in the polarized vote, and will have 18 seats in the new parliament.
The, a revolutionary socialist organization and one of the founding groups in SYRIZA in 2004, issued this statement about the results on June 17, and what comes next for the left in Greece. It follows:
1. The results of the election on June 17 were a continuation of the political earthquake of May 6, which radically altered the balance of political forces.
The showing for the left, expressed in the decisive support for SYRIZA among the working class and the popular classes—created panic among the local ruling class, and also among its international allies. At the same time, it created a wave of hope, excitement and solidarity for the resistance movement and the left, both at the European level and globally.
This achievement of the working class of May 6 and June 17 must be defended, and it must be completed.
2. The results of this election prove that the goal of overthrowing the pro-austerity forces and electing a left-wing government that would take on the task of stopping the attacks of the capitalists, the EU and the IMF in order to protect the interests of the working class was possible. SYRIZA, by throwing all its forces in the pursuit of that goal, in a determined way and with an honest attitude based on unity, succeeded in winning massive growth on a level that is unprecedented in all the years since the military junta that fell four decades ago.
United, we can win! We can succeed in bringing a radical change in Greece, and we can fuel the fire that is simmering in Europe.
A guide to Greece’s political parties
Athens, Greece - On May 6, Greek voters - battered by recession and largely disillusioned with the country’s two biggest political parties, PASOK and New Democracy - will go to the polls to choose new members of the Hellenic Parliament.
The central issue in the election is what has come to be known simply as “the memorandum”. In October 2011, the European Union and International Monetary Fund offered cash-strapped Greece a second financial rescue package, but only under conditions spelled out in a Memorandum of Understanding.
These conditions require that Greece improve its finances by cutting spending and raising revenue. To do so, the Greek government - led by an interim government consisting of both PASOK and New Democracy - has slashed pensions and wages and raised taxes.
Anger with the memorandum has given birth to several new parties. Thirty-two parties will compete in the elections, and polls suggest that about ten of them are likely to win seats in parliament. With no single party likely to win much more than a quarter of the vote, a confusing aftermath seems probable.
If no party receives an absolute majority of votes - as will almost certainly be the case - the party that received the most votes will be tasked with forming a coalition that can win the support of a majority of parliament’s 300 members.
What do Greece’s political parties stand for? The ten parties that polls show are most likely to win seats in parliament are described below, roughly arranged by ideology - centrists, the left, and the right.
However, whether or not a party supported the memorandum may prove to be a more important factor in this election than its location on the left-right spectrum.
New Democracy (ND)
New Democracy, Greece’s main centre-right party, was clobbered at the polls in the 2009 elections. And since November 2011, when it joined PASOK in a ruling coalition, support for ND has dropped even further, with right-wing parties reaping gains.
ND opposed the first EU-IMF bailout package in 2010 and subsequent austerity measures, when PASOK was the sole governing party. However, after Prime Minister George Papandreou resigned in November 2011, ND joined PASOK in an interim government tasked with taking the necessary measures to secure a second EU-IMF bailout package.
Despite declining support, ND looks set to win more votes than any other party, with between 20-25 per cent of Greeks planning to vote for it. And under Greek election law, the party that wins the most votes automatically wins 50 extra seats in parliament. Many expect ND leader Antonis Samaras to become Greece’s next prime minister.
Samaras has promised to raise pensions and cut taxes, and has said he wants to renegotiate aspects of the memorandum after the election.
Panhellenic Socialist Movement (PASOK)
Founded in 1974, centre-left PASOK performed well in the 2009 parliamentary elections, and currently holds more seats in parliament than any other party.
Shortly after taking power, however, the administration announced that Greece’s budget deficit was more than twice as large as the previous government had publicly claimed. In the face of spiralling bond yields, the PASOK-led government requested a bailout package from the EU and IMF, implementing austerity measures to secure European support.
PASOK bills itself as a socialist party, but critics on the left have charged that its support for austerity - which includes big cuts to social spending - make it socialist in name only. Now, the party’s support is near historic lows. Polls show that just about 15-18 per cent plan on voting for PASOK.
Party leader Evangelos Venizelos, formerly the Greek finance minister, has said the party will not support further tax hikes, and has suggested Greece will need to implement structural reforms and privatisation to make its economy more competitive.
Communist Party of Greece (KKE)
Greece’s oldest political party, the KKE, was founded in 1918 and has historically played a major role on the Greek left. Today, the KKE adheres to doctrinaire, Marxist-Leninist communism. It has ruled out working in a coalition with other left-wing parties.
Party leader Aleka Papariga has said the party supports“complete disengagement” from the European Union, and wants to abandon the euro in favour of Greece’s previous currency, the drachma. The KKE has staunchly opposed the terms of the EU-IMF bailouts.
The KKE’s support tends to come from Greece’s working class, especially in big cities and in industrial regions. Currently, about one in ten Greeks say they plan on voting for the KKE.
Coalition of the Radical Left (SYRIZA)
Made up of 16 ideologically diverse left-wing parties, SYRIZA includes “social democrats, radical ecologists, radical socialists, Trotskyists, and even anarchists”, according to Matthaios Tsimitakis, a SYRIZA supporter and an editor of political blog Greek Left Review.
SYRIZA supports Greece’s membership in the European Union, but rejects the austerity measures required by the memorandum. SYRIZA has made repeated overtures to other parties on the left inviting them to form an anti-bailout coalition. However, both the KKE and Democratic Left have rebuffed this proposal.
About ten per cent of voters support SYRIZA, say polls.
Led by the self-effacing Fotis Kouvelis, Democratic Left was formed in 2010 by SYRIZA defectors, who viewed the coalition’s outlook as becoming increasingly anti-Europe.
Democratic Left takes a more moderate position on the memorandum than SYRIZA, maintaining that Greece could fulfill its requirements while scrapping the harsher elements of austerity, such as legislation passed in February that reduced the minimum wage.
Kouvelis has said that the party would not be open to a coalition with the current ruling parties, PASOK and New Democracy.
Polls show about eight per cent of voters plan on voting for Democratic Left.
Founded in 2002, this environmentalist party has never broken the three per cent barrier necessary to win seats in parliament. That might change this election: polls show the party may narrowly pass the threshold.
Ecologist Greens oppose the memorandum, partly for environmental reasons. Yiannis Paraskevopoulos, the head of the party’s list of state deputies, said that the reforms spelled out in the memorandum favour an “economy of plunder”, including plans to drill for oil and mine gold in Greece.
The party supports Greece’s membership in the eurozone and the EU. Although Ecologist Greens have said they would not be part of a coalition with New Democracy or PASOK, they may be open to working with SYRIZA.
Led by Dora Bakoyannis, the first female mayor in the history of Athens, the centre-right Democratic Alliance is one of the few parties outside the ruling coalition that supports the memorandum.
Bakoyannis founded the party after being expelled from New Democracy in 2010 for voting in favour of austerity measures, which New Democracy opposed at the time. Now, Bakoyannis has said that the party would be willing to enter into a coalition with PASOK and New Democracy, under certain conditions.
The party advocates a flat tax rate and a reduction in the number of public-sector employees.
Polling at only about three per cent support, Democratic Alliance may just barely manage to win seats in parliament.
Created just two months ago by New Democracy dissidents unhappy with the terms of the bailout, Independent Greeks look set to win about ten per cent of the vote, say polls - with much of it likely to come at the expense of New Democracy.
The party has been adept at using social media sites such as Facebook and Twitter to spread its message. For what it’s worth, Athens News notes that party leader Panos Kammenos has several times more “likes” on his Facebook page than the leaders of either of the two major parties, PASOK and ND.
Kammenos has said that the party would not work with PASOK or ND after the election. He also rebuffed an unexpected overture from Alexis Tsipras, leader of left-wing SYRIZA, who had suggested that the parties might work together in an anti-bailout coalition.
Popular Orthodox Rally (LAOS)
The nationalist Popular Orthodox Rally party briefly took part in the ruling PASOK/ND coalition - marking its first time in power - but pulled out in February 2012, after refusing to support further austerity measures. All four of LAOS’ government ministers resigned from their cabinet positions.
Like other Greek right-wing parties, LAOS - which describes itself as “hellenocentric” - opposes illegal immigration, and suggests deporting all undocumented immigrants. “I don’t want them to become a majority,” party leader Giorgis Karatzaferis has said. LAOS also supports tax cuts and a hard line against Turkey.
The party’s short membership in the interim government has caused some voters to flee to far-right parties such as Golden Dawn. Polls show LAOS with about four per cent support.
The far-right Golden Dawn party was founded by supporters of the military junta that ruled Greece from 1967-74. Now, for the first time, polls estimate that Golden Dawn will win five per cent of the vote, allowing the party to win seats in parliament. In 2009, the party won just 0.29 per cent of the vote.
Golden Dawn, which is virulently anti-immigrant, has said that undocumented immigrants should be immediately deported - and that immigrants who are in Greece legally should eventually be removed as well. Golden Dawn has recently gained publicity for offering to accompany elderly people on grocery shopping trips if they feel unsafe leaving their homes alone.
The party is nostalgic for Nazism: its logo resembles a swastika, some party officials reportedly deny the Holocaust occurred, and video appears to show party leader Nikos Michaloliakos giving a Nazi salute in the Athens city council. He claims, however, that it was merely “the salute of the national youth organisation of [Greek dictator] Ioannis Metaxas”, reports the Athens News.
The remaining 22 parties competing in the election are running on platforms ranging from neoliberal (Drasi) to centrist (Union of Centrists) to revolutionary (Anticapitalist Left for the Overthrow) to pro-internet freedoms (Pirate Party of Greece).
A number of Communist splinter groups are also running, such as the Organisation for the Reconstruction of the Communist Party of Greece, and the Communist Party of Greece (Marxist-Leninist)-Marxist-Leninist Communist Party of Greece.
Four parties were banned from participating in the elections. One party, named “Tyrannicides”, was barred because its name “demonstrated criminal intent”, said Greece’s Supreme Court.
And perhaps the most prolix party is led by 83-year-old perennial candidate Miltiadis Tzalazidis, who spells out his party’s platform in its name: “Renewing Independent Left, Renewing Right, Renewing Pasok, Renewing New Democracy, No to War, Party of Action, I Give Away Land, I Pardon Debts, I Save Lives, Panagrarian Labour Movement of Greece.”
Follow Sam Bollier on Twitter: @SamBollier
- No ratification of the Fiscal Pact
- Cancellation of national debts
- Nationalisation of the banks
- Radical redistribution of income and wealth
- Overcoming of mass unemployment
- Democratising democracy
Call to Action! World-wide decentralized protest demonstrations!!! Motion to all GA’s.
European protest demonstrations will begin in Frankfurt am Main on 17th-19th May 2012.
We are experiencing the deepest crisis of capitalism since the great depression of the 30s – and the European governments continue to pour oil on the fires! From the very beginning, some governments have prevented a solidarity-based solution to the crisis in Europe and are significantly responsible for its exacerbation. This refers particularly to the German government, which, in August 2008, blocked a substantial economic stimulus package for Europe. Hardly had the recession reached its lowest point in Germany in 2009, when the German government preached the necessity for hard austerity policies. The “debt brake” was anchored in the constitution: politics disempowered itself, shaped by neo-liberal ideology. The austerity measures taken in various EU states affected above all wage-earners, pensioners, the unemployed and the self-employed, while the wealthy, the banks and the corporations were spared. In spring 2010 the German government blocked aid for Greece, causing a steep rise in the yields of Greek government bonds and thus an increase in national debt and making a solution of the crisis more difficult and expensive.The loan agreements with Greece and other countries in crisis and their ridiculous austerity demands only made the crisis worse. For example, the reduction in the Greek minimum wage does not contribute to an increase in “competitiveness”, as the country’s current account deficit is as much due to the mercantilistic policies of the core eurozone countries, as to the role of deregulated finance. Instead, the reduction of the minimum wage has destroyed the internal market further. This example makes clear that the current crisis politics redistributes wealth from wage-earners to those who possess the capital, regardless of the macro-economic and societal consequences. Greek salaries have already dropped by 20-30%, hundreds of thousands of people are losing their jobs, over 10,000 schools are closed, hospitals are running out of medication, children are starving. Similar developments are also looming in Portugal and in other European countries.
Neo-liberal politics, whose failure has become obvious in this crisis, is being radicalised once more. The aim of the “fiscal pact”, for example, which was agreed by the heads of state and heads of government of 24 EU states on 2nd March 2012, is to make neo-liberal austerity policies legally binding for all time. A “debt brake” in line with the German model should be anchored across the whole of Europe. National budget deficits should, in future, be capped at 0.5% of GDP. This plan overlooks the fact that already in the 1990s the “Stability and Growth Pact” agreed by the European Economic and Currency Union, which had allowed a budget deficit of 3% of GDP, could not withstand the reality of a capitalist society dogged by crises. The 3% deficit was frequently exceeded. The “Treaty on Stability, Coordination and Governance in the Economic and Monetary Union”, as the Fiscal Pact is officially called, is more than the result of unrealistic plotting by neo-liberal economists and politicians. Further waves of privatisation, destruction of jobs, restriction of public services, social degradation, and wage reduction, are pre-programmed across the whole of Europe; and all to protect the profits of a small group of rich capitalists. The destructive policies which have been pushed ahead mainly by the German and French governments have been accepted and put into practice by nearly all EU governments, because in every state there is a dominant wealthy clique who profits from the increasing pressure on the wage-earning population.
The European crisis policies lead to an increased undermining and devaluing of democracy. Not least through international pressure were the governments in Greece and Italy removed from office and replaced by a government of “technocrats” in order to calm “the markets”. These governments make far-reaching decisions without having the legitimacy of being elected. A proposed referendum on the austerity measures in Greece was quickly quashed after pressure from the ruling powers. Elections become meaningless when the large parties represent more or less the same policies, as recently in Portugal and Spain. Responsibilities are moved from the national level to the EU-level without an adequate democratic control of the activities of the EU institutions such as the European Commissions, the European Central Bank, or the European Court of Justice. We note with great concern the increased nationalist, racist and fascist movements in various European countries.
And yet the prevailing policies are not without an alternative. A significant alternative, however, is only possible when the roots of the crisis are correctly identified. National debt crises form only one aspect of the current European crisis, in which the tensions of European integration (unequal development, common financial policies without common policies on wages, taxation and industry) collide with a structural over-accumulation of capital. There is too much capital, measured by the possibilities which remain to exploit work and the environment.
An alternative strategy for attacking the crisis needs to include the following elements:
- No ratification of the Fiscal Pact
The Fiscal Pact means further loss of democracy, commits nations to neo-liberal policies, and increases the crisis.
- Cancellation of national debts
A public debt audit must clarify how the debts were incurred and who is in possession of the government bonds. One person’s debts are another person’s wealth. The savings and pension entitlements of the broad mass of the population must be secured, while the interest and repayment entitlements of the wealthy, the banks, the hedge funds and the corporations must be cancelled.
- Nationalisation of the banks
Banks which have been saved by public funds must be nationalised. Banks which are “too big to fail” must be divided up.
- Radical redistribution of income and wealth
We need a tax on financial transactions, an increase in taxation on capital returns, a re-introduction of wealth tax and a much stronger progression in income tax, in order to achieve a lasting financing of state spending and increase in benefits, and to enable social and environmentally necessary investments, as well as to combat world poverty.
- Overcoming of mass unemployment
Mass unemployment, low wages and wage reduction are important reasons for decreasing wage rates and the creation of surplus capital which inflates the financial sector. There must be an end to the manipulation of unemployment statistics. Mass unemployment can only be overcome by a radical reduction in working hours.
- Democratising democracy
Democracy must be strengthened at all levels, especially at the European level, and must also include the economic sector. It cannot be possible that democracy comes to a stop at the gates of the factories and the banks, and that a small group has the means of production at its disposal, when human survival depends on it.
The “Arab Spring”, the movement of the “indignant ones” in Spain, the numerous strikes and demonstrations in Greece and the worldwide “Occupy” movement which started in the USA, are all a source of encouragement. It is high time to strengthen the protests and to take them to the place where the European crisis policies are apparently decided.
This is why we are announcing the world-wide decentralized protest demonstrations on 12th May as well as the European protest demonstrations which will take place in Frankfurt am Main on 17th-19th May 2012.
Organisations / Networks