The Spark

the Voice of
The Communist League of Revolutionary Workers–Internationalist

“The emancipation of the working class will only be achieved by the working class itself.”
— Karl Marx

New Austerity Measures Provoke Demonstrations

Jun 20, 2011

Thousands of protesters continued their demonstrations against austerity measures in all the large cities of Greece. On June 5, for example, a human tide – made up of old and young, retired, students, workers – enveloped the square in front of the Parliament in Athens. And on June 15, two unions, one public, one private, called for a general strike. The number of demonstrators continues to grow, showing how anger against the government’s measures is increasing.

The European Bank and the European Commissioners and the International Monetary Fund want to impose yet more measures against the Greek population, a veritable war against the population.

The bankers and states at their service want the Greek government to put in a program of privatization worth 70 billion dollars. Everything is for sale – the ports, the airports, the phone companies and the utilities, even the betting shops.

It’s not just that public services are being sold at a discount, impoverishing the entire country, but also workers are being attacked at the work places. The buyers are saying that enterprises are badly managed, not competitive and costs must be reduced. Deutsch Telekom, which already owns 30% of the Greek phone system, may want to acquire the rest, at a very low price, of course. They say electricity prices, among the lowest in Europe, must be deregulated, that is, they must go up! Otherwise it won’t be possible to find a buyer for part of the electric utility PPC.

Unemployment is already high, 15% of adults and 30% of youths in Greece. On average, salaries have been forced down by 20%; sales taxes have gone up drastically, along with taxes on small businesses. Of course, with the economy slowing down, even less tax money goes to the treasury. It becomes impossible to pay back the interest on the debt, let alone the debt itself.

It’s a vicious circle for which the bankers of all countries are responsible. Their speculation weakened the world’s economies, squashing the Greek population. The demonstrators are right to want the bankers to pay.

Where is the Money?

Why is Greece in particular so broke in this latest recession? The media claims it’s because the Greeks don’t pay their taxes! They say the Greek tax men could have collected 20 to 30 billion euros more in 2009 (28 to 42 billion more dollars).

But if there is tax fraud, it is above all fraud committed by the wealthy. And most of it is perfectly legal – shipbuilding, for example. Greek shipbuilding accounts for 16% of the shipping tonnage around the world. Many of these companies are registered in Cyprus, quite legally, which has its own kind of fiscal paradise for the Greek owners. Their assets are held in Cyprus so they don’t have to pay taxes in Greece. Onassis’ fortune, based on shipbuilding, has funneled into Switzerland, and it may have cost the Greek treasury three to four billion in taxes. The Latsis family, another Greek shipping owner worth billions, escaped even more billions in taxes.

A Greek union estimated that the 6,000 largest companies in Greece manage to evade some 21 billion dollars’ worth of taxes. A Greek builder Aktor Group got the contract to build a bank in Qatar. The Greek capitalist might be smaller than those elsewhere, but they manage to grab their share and then avoid paying taxes.

The other group evading taxes is the Greek Orthodox church, which owns a huge amount of woods and acres of pasture, bringing in rich revenues, plus 300 apartment buildings and other enterprises. The taxes are low and the church’s rich monastery on Mount Athos, a tourist and pilgrim attraction, escapes all taxes. Nonetheless, the church leaders recently complained they are so overburdened with taxes that they “can’t even afford to buy candles.”

Meanwhile, the Greek state pays the salary for all the Church authorities and lets the church grab buildings built for the Olympic Games for a song.

So the Greek state does not make the big capitalists nor the church pay, despite their riches. Some contractors got rich off the Olympic Games held in Athens in 2004 but overall, the Greek economy gained nothing. The Greek debt grows as these vultures enrich themselves.

By contrast, the government demands that the population pay ever more taxes on their salaries, and pay for the crisis with lower salaries, and with higher sales tax, all of which weighs heavily on those least able to pay, including the unemployed. By the end of 2011, another 250,000 Greeks are supposed to lose their employment to pay off the debts run up by the Greek state for the wealthy.

International Bankers Want More

Global investors say the Greek bonds are “speculative,” meaning they are risky. It’s an excuse to charge very high interest rates. These speculators expect to make big bucks from Greek misery. They demonstrate exactly how the world of international finance works.

Ordinary people are expected to pay and pay and pay. The Greek demonstrators are showing what they think of this proposal.