Divide and rule in Greece and Egypt

The sigh of relief expressed by the financial markets and the major capitalist governments over the outcome of the Greek election reveals how desperate the ruling elites are for any “good news”, however ephemeral it proves to be.

The crisis of the euro is now centred on Spain, the fifth largest economy in Europe, which now faces sovereign bankruptcy as well as debt-ridden banks. And next in line is Italy.

Whatever the right-wing New Democracy-led government cobbles together, the fact is that the Greek economy has been smashed, working people can take no more austerity measures and basic supplies like medicine are drying up.

So nothing is different this morning, except that Syriza, which wanted to renegotiate the draconian bail-out terms, did not win. The Brussels bureaucracy and German chancellor Merkel were terrified that an “unreliable” left coalition might come to power in Greece, just as the euro is in its deepest ever crisis.

But it remains a narrow victory for the New Democracy, Greece’s conservative party, which garnered only 3% more of the vote than the Syriza left coalition. Party leader Antonis Samaras is now in negotiations to form a coalition with the Pasok pseudo-Socialist Party, which received 12%, in an attempt to increase his majority – in advance of either party’s agreement to the talks.

Real fear spread in the commanding heights of Europe after the May 6 general election in Greece when the Syriza party, lead by Alexis Tsipras, appeared out of nowhere to gain some 17% of the vote. Syriza’s share of the vote has risen to 27%, thus bucking the notion that European voters cannot be enthusiastic about a left radical party.

Syriza is a coalition of 13 groups including democratic socialists, euro-communists, Marxists and greens. It is, however, pro-European Union as well as in favour of staying in the euro and simply wanted to ease the burden on the Greek people.

Tapping into the suffering caused by the harsh terms of the bailout, Tsipras has won over public sector workers many of whom have received no wages for months, unemployed young people and Greeks of many political complexions who feel they have nothing to lose by taking a chance.  

Meanwhile, in Egypt, the military has effectively seized power as the country awaits the result of the presidential election. It has issued a declaration granting itself sweeping powers. The document by the Supreme Council of Armed Forces (Scaf) says new general elections cannot be held until a permanent constitution is drawn up. It also gives the Scaf legislative control.

On the eve of the elections, under the influence of pro-Mubarak judges, Egypt’s Constitutional Court, dissolved parliament. Emergency laws were then revived, which give the military free rein to arrest civilians without reference to the courts.

It is a pre-emptive coup d’état by Egypt’s “deep state” – the military-economic establishment – has moved to forcibly end the dual power situation that has prevailed in Egypt since Mubarak’s overthrow by a mass uprising last year.

The two candidates in the election both stood for reaction. On the one side, the Muslim Brotherhood Mohamed Mursi, on the other, the continuation of  Mubarak's “deep state” through prime minister Ahmed Shafiq. So in the absence of a real choice. In both rounds, voters opted for the candidate who would best counteract the contender they do not want. In other words, “the lesser of two evils”.

Have we seen the exercise of the people’s will in either of these elections?  In Greece, even though 55% of voters opposed the pro bail-out parties, the country now has a pro bail-out government! In Egypt, the army is determined to retain control – whatever the outcome of the presidential election while dissolving parliament altogether.

Elections have made no difference in either country to decide who truly holds power. The elections were in fact a form of democracy denied, with serving to polarise and divide society and allow the elites to stay in power – a form of “divide and rule”.  The conclusion?  If there ever was a time to create new forms of democratic expression such as people’s assemblies, it is now.

Corinna Lotz

A World to Win secretary

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'Going for growth' will bring new attacks

If Europe’s voters think “austerity” is bad for their health, it’s nothing compared to what some of the advocates of “growth” have in mind as the next stage of the crisis unfolds.

People like Mario Draghi, president of the European Central Bank, know all too well that providing trillions of euros in cheap loans to banks has not led to increased lending.

The eurozone is firmly in recession so plan B is on the agenda. As far as Draghi is concerned, the aim is “structural reforms” like “labour-market flexibility” and increased competitiveness through speed up and lower wages.

In other words, living standards have to be driven down faster and further for there to be any chance of the eurozone coming out of recession.

What Draghi’s plan confirms is that the crisis has entered a new, more dangerous phase - economically and politically. The deadlock is absolutely clear in Greece.

The rejection of the draconian EU-IMF bail-out terms in the Greek election cannot be satisfied by any political deals amongst the minority left parties. Demands by Alexis Tsipras, leader of the Syriza party to tear up the deal cannot be met because the global capitalist economy is imploding.

Some like to say that “austerity isn’t working” and should be abandoned in favour of growth. The Guardian’s Seamus Milne remarks: “Cutting jobs and pay while increasing taxes isn't reducing borrowing and debt, let alone leading to economic recovery. It's deepening recession, increasing debt and destroying jobs and squeezing living standards across the eurozone – in countries such as Spain and Greece, catastrophically – as well as in Britain.”

This is stating the blindingly obvious but ignores a salient fact. Forced to contract by its own logic, capitalism is beyond the control of any political initiative that leaves the system intact.

The reality is “going for growth” just means moving to the next stage of a brutal contraction that will see workers sacked, factories closed, shutting down unprofitable production, driving up rates of exploitation.

New measures by the Con Dem coalition in the Queen’s speech like reducing public sector pensions and making it easier to sack workers, are part of this process.

The scale of what has to come if the current system is to survive is too terrible to contemplate. Attention must now turn to the means by which a new system can be created.

The interdependence of politics and economics rules out talk of a new direction for the economic system without a new political arrangement that removes the power of global corporations to dictate to governments.

Seismic shifts in electoral results in Europe follow on from mass movements in North Africa and the Middle East which have toppled regimes that ruled throughout the latter part of the twentieth century.

With unemployment soaring, anger cannot be contained and will explode on the streets  throughout Europe in the coming months.     

Replacing a bankrupt for-profit system with new forms of common ownership can only be carried out by new political formations, not co-existing with the world of capitalist corporations and global financial institutions, but challenging and replacing them.  

People’s assemblies, where everyone participates in the decision-making, can take the place of a five-yearly cycle of voting for representatives who immediately become subjects of capital.

A global network of people’s assemblies can establish democratic control over the financial and productive resources of the world, protecting them against the threat of destruction, turning them to the satisfaction of need. 

We should not ignore the other message from Greece, where an openly fascist party won 20 seats in parliament. People’s assemblies have to become the future shape of democracy because the old political order is crumbling but does not intend to go quietly.

Gerry Gold

Economics editor 

A gigantic 'no' from Europe's voters

Political crisis is spreading like a forest fire through Europe following the inconvenient intervention, for the ruling classes that is, of millions and millions of voters in Britain, France, Greece and now Italy.

A rejection of austerity has produced the rare ousting of an incumbent president in France, the overwhelming rejection of austerity parties in Greece, a hammering for the ConDems in Britain and in Italy huge success in local elections for a new movement led by a comedian.

The 5 Star Movement, led by Beppe Grillo, a tussle-haired comedian who wants Italy to quit the euro, made some stunning advances. In Parma, it knocked Silvio Berlusconi's PDL which had previously ruled the city, into fifth place, winning 20% of the vote.   

"We are an epic change. And this is just the beginning. The parties are melting into a political diarrhoea. The citizens are taking back their institutions," Grillo said in a YouTube message.

This concerted rebuff for the old political order has had an immediate impact on European capitalism’s cherished project, the single currency. With bankrupt Greece unable to form a government in time to meet bail-out conditions, its ejection from the euro is a distinct possibility.

Jason Conibear, director of the global foreign exchange specialist Cambridge Mercantile, said of the election results: "There's every chance the euro will go into freefall in the weeks ahead against all the major currencies…Whether it was right or wrong, until the French and Greek elections this weekend there was at least a script. The script of austerity has now been torn up and the sovereign peoples of Europe are starting to ad lib."  

In another eurozone country, Spain, the slump in the economy has left banks on life support and needing a bail-out sooner rather than later. Whether the Spanish state can find the resources for this operation is an open question. Industrial production has fallen by 7.5% in a year and one in four workers is unemployed.

Right round Europe, the massed voices of voters through the ballot box express a clamour for change. The political class, old and new, have tried to embrace the movement. In Greece, Alexis Tsipras, leader of the second most successful party, the united left bloc Syriza, declared:

“The people of Europe can no longer be reconciled with the bailouts of barbarism.” He added: “We want to create a government of leftist forces in order to escape the bailout leading us to bankruptcy ... We're not going to let in through the window what Greek people kicked out the door.”

Such a government seems an impossibility, however. And unless Greece meets its EU/IMF loan obligations, it may not be able to pay public sector salaries next month.

In France, president-elect Francois Hollande pledged to “finish with austerity” after defeating Nicolas Sarkozy, whose political party, the UMP, is facing a break-up as a consequence of his ousting. But Germany’s chancellor Angela Merkel has told Hollande there can be no going back on the fiscal pact agreed by eurozone states.

Although voters have spoken in dramatic terms, solutions to the crisis will have to be found outside of the parliamentary arena. For example, Hollande’s “growth” policy is not an option because the global capitalist economy is in a period of great contraction. This has a momentum of its own that is more powerful than any policy adjustments that might be made.

The parliamentary state, however democratic it appears, is actually part of the problem.  It has all but merged with corporate and financial power. Effectively, we live in a  corporatocracy not a democracy.

Voters around Europe have demonstrated their potential to challenge for power itself rather than being content with rearranging the deckchairs. In every country, the electorate has to become a thing for itself rather than an object for others to use and abuse. Helping to build this self-awareness with the aim of putting Europe’s bourgeois elites out of their misery, is the challenge.

Paul Feldman

Communications editor