Wednesday, September 26, 2012

Point of no return in Europe


Impasse. Tipping point. Crisis. Boiling point. Point of no return. Explosion. What words can convey the profundity of the present moment of transition?

The people of southern Europe in Portugal, Spain and Greece have reached the limits of their preparedness to tolerate more brutal assaults in the name of austerity.

But the leaders of the public and private sector unions who have called today’s general strike in Greece do not intend their collective action to bring down the three month-old coalition, let alone challenge the economic and social system. Quite the opposite. 

"We call on everyone to take part in the strike and resist the austerity measures that hurt Greek people and the economy," said Despoina Spanou of the ADEDY labour group.

With unemployment at a record high in Greece – hitting almost 24% at a national level and 55% among young people, the highest in Europe – the leaders want the action to emphasise how deficit-cutting measures at the expense of growth and development are creating an economic death spiral. As Stathis Anestis of the GSEE union group put it: “These policies have led Greece to an impasse and are totally counter-productive.”

The anger is intensified by the European Union, European Central Bank and the IMF who are pushing for further cuts in wages and pensions which have been drastically reduced in the five years since the crash. As well as proposing the introduction of a six-day working week, the Troika aim to cut the minimum wage by 22% and abolish collective labour agreements.

Union leaders, not just in Greece but throughout Europe, have no intention of going beyond resistance and protest actions. Their “alternatives” are based on the notion that present policies are “wrong” and that growth would be better.

But we are patently in a crisis of the capitalist system of global proportions, where contraction is driven by an inner momentum which governments of all persuasions are barely able to influence let alone halt. And the political crisis is growing too, especially in Spain where riot police fired rubber bullets to prevent crowds storming the parliament building yesterday.

In Catalonia, nationalists are turning the anger onto the federal government. Catalan President Artur Mas has called an early election for 25 November, a move towards secession that has stirred dark warnings from the military with echoes of the Spanish civil war.

The people of Portugal have also had enough of austerity, with one draconian package after another imposing longer working hours, 7% pay cuts, tax rises, and an erosion of pensions. Unemployment has reached 15.7% - with one in three young people jobless..

A week ago, more than half a million people marched in cities across the country in the biggest protests against the government since the end of the dictatorship in 1974. The peaceful marches were a milestone in a country where people are not known for a protest culture.

From left to right, from moderates to radicals, from young to old, from professional protesters to first-timers, it was an unmistakable warning shot for the government. Protests were scheduled even in wealthy Cascais, a coastal city near Lisbon famous for its upper-class demography.

In the shadows of the darkening clouds of the planetary emergency brought on by decades of debt-fuelled growth, the crisis engulfs, overwhelms and overpowers the increasingly desperate attempts by agencies and governments to build new defences as the old ones fail to deliver.

You can see that in Britain, where the deficit is rising and only the printing of vast amounts of money by the Bank of England is holding back economic collapse. Yet the TUC is restricting itself to a weekend demonstration and the threat of some scattered, one-off strikes over pay sometime next spring. It just won’t do.

Humanity stands at the threshold of an evolutionary leap in social organisation. Either we cross it, building a not-for profit economy and society based upon co-operation and collective stewardship of the world’s resources, or we will become capitalism's victims.

Gerry Gold
Economics editor

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