Greece’s ruling political party, Syriza, is experiencing an unexpectedly inflexible response from the Troika—European Union, International Monetary Fund, European Central Bank—concerning partial forgiveness of its outstanding debts, prompting questions about whether it’s in the country’s best interests to exit the Euro, and the European Union as a whole. If so, then what?
In short, YES, there is a viable future for Greece. The same “viable future” as exists for the rest of the world economy.
if Greeece is going to be singled out as the target to be bullied by the EU branch of the corrupted and bankrupt Bretton Woods/IMF/WTO/World Bank/US$-reserve-currency system, they might as well lead the stampede to the exits.
Britain has decided to become a “founding member” of the China-led Asia Infrastructure Investment Bank, with many other US “staunch allies” either already in or considering joining.
The BRICS is no working-class freedom panacea, merely a new-boss version of the same 0.01% bankster interests. The only saving grace is that it is by definition, multi-currency, and therefore less likely to serve as a launching pad for sole-superpower economic/militarist domination that the Bretton Woods/US Federal Reserve system has proven to be.
I agree. The problem with leaving the Euro is that who will recognize the Drachma which, on its own, would be severely devalued. Having it recognized by BRIC and backed by the Yuan would certainly help.
Collecting taxes from the rich should be number 1, with the money gained used to create co-operative employment. To the income tax, there should be added tax on total wealth.
Before that can happen, however, the export of money should be strictly controlled, since naturally the wealthy will try to get all of their funds safely abroad.
Meanwhile, current efforts to self organize into co-operative mutual aid teams need to be vastly expanded. And every available space in the cities needs to be planted with organic permaculture and aquaponics food crops, as in Cuba. Not only will people have enough to eat, but overall health will improve, and the use of imported fossil fuels will decline. These measures will be the foundation of an ever expanding co-operative democracy, which will be copied throughout Europe.
Great piece! The only exception i would make is " …experiencing an unexpectedly inflexible response from the Troika … " Unexpected? Really? a bit naive, if that is true …
I think Syriza should have gone into “negotiations” with a Grexit tucked into its back pocket, ready to pull it out when things went sour - and with that in mind, they should have educated and prepared the Greek populace for “Plan B” should the initial gambit fail, as, frankly, quite “expectedly”, it did - they had enough time in the run-up to the elections for that …
Capital controls had better be enacted lickety-split - the longer they wait the less capital there will be to “control” …
And i am soooo glad he mentioned that “awful” “P” word - protectionism - every country, including the US, should be protecting all the domestic industry it needs to be as self sufficient as possible - that is where true “national security” lies ( I often ask how secure can a nation be that doesn’t even make its own underwear anymore?) For a great expose on the history of trade policy, check out “Bad Samaritans” by Ha-Joon Chang … Lefties for too long have been shying away from that concept, IMO … Things started really going to pot (not the green kind …) here, and in other nations, when we got on this “free trade” kick, facilitated by both corp parties for the benefit of, surprise, surprise, the corps …
Ha ha! Like most every other nation Greece will have to pay for imports out of its foreign currency reserves, whether those reserves are Euros, Dollars, British Pounds, Chinese Yuan or something else, like gold. – As the article suggests, Greece will have to reorganize reorient its economy so that it always has a sufficiently positive amount of foreign reserves.
The US became the preeminent economy BECAUSE it practiced protectionist policies. It is ironic that while the US taxpayer pays the bill for covertly/militarily enabling other economies to be pried open to destructive IMF/WTO/World Bank “globalization”, the US has been equally ravaged by “free trade” and international “competitive labour” corporatism.
Syriza may be “playing dumb”, knowing full well that Russia and China will offer a better deal than the EU/IMF. Just like Russia did to Ukraine shortly before the Maidan put Porkyshenko and his Banderite neo-nazis in charge in Kiev. The Ukraine/Russia deal was 3x as much with no IMF austerity requirements. Apparently all of the 2014-promised EU/IMF money has still not made it to Ukraine. But Kiev can’t complain or risk the latest 17billion EU promises.
A “weak” Drachma makes exports cheap, only imported good from “strong currency” countries would be expensive… GEE the ruble is also a bit “weak” these days, so Greece importing from there would be less than say, from the EU…
It is highly doubtful the US would invade Greece, and it would stand to reason Putin will have good practical advice on how Syriza can avoid a Maidan or colour revolution. He just defused the “Nemtsov grief march” Maidan attempt. Like Putin, Syriza has a good enough public approval that too few would show up to incite a street revolt.
Response to Laurenceofberk:
Regarding “Before that can happen, …”: I have read for months warnings in the financial press that people should get their money out of Greece while they can. That’s both rich and ordinary folks. Likely Greece has already been drained of most liquid capital. But the far-left is entitled to try and shut the barn door at this point, even if most of the animals have fled.
Regarding “Collecting taxes from the rich should be …”: I have read for months and years in the financial press that Greece is way past the maximizing point on the Laffer curve. Taxes are so heavy, and government and public employees are so discredited, that people joke that tax evasion is the national sport. Greece might discover, like many other nations have, that cleaning its own governmental house and cutting taxes will get the economy going again. – But then again, the far-left does have a mandate, from the last election it seems, to go whole hog with their whole program. It will make a nice spectator sport to see what happens.
“Practiced” is the key word here - it has fallen because it has abandoned that “practice” … and needs to re-instate it, IMO …
Playing dumb is fine as long as one is not caught being dumb …
“Greece might discover, like many other nations have, that cleaning its own governmental house and cutting taxes will get the economy going again.”
At least, that is what we are constantly fed in our media, and no wonder too, because it is owned by the big money. “Cutting taxes” is one way to continue the transfer of wealth from the poor to the rich. And according to this myth, we will all benefit from the trickle down affect.
But in reality the wealth does not trickle down, only pee. Austerity is not imposed for the benefit of the population, it is something that benefits the rich. It happens because the democracies have been bought by the money. Transferring yet more wealth to the rich has not succeeded and more of the same will not “get the the economy going”. In Greece, this has failed so badly that Greece’s two party system has collapsed. Its Rs and Ds (by different names) collectively ended up with just 23% of the vote, despite the best effort from the media to condemn alternatives. Its not just Greece where austerity has failed, but it is failing all over Europe.
And it is failing in the USA too. It failed spectacularly in the USA in the 30s 40s and 50s! There is a reason why Roosevelt put an end to this in the early 50s, and that was to avoid a bloody revolution. The new deal which saw taxes placed on the rich and job creation for the poor, redistributed the wealth. A government with no money rejuventated and repaired the broken economy of the USA.
If you had not noticed, everything done in the new deal has now been undone. Every social issue and ill of society flows directly from this, including, but not limited to the world’s highest incarceration rates that the USA enjoys. Eventually there will be hell to pay if something is not done to redistribute the wealth.
Well, you will interpret it as best pleases yourself. …
The neo-liberal-welfare-statist governments BEFORE Syriza made a corrupt and turgid mess of Greece’s situation. Someone is going to have to cut all those unhealthy tumors out of Greece’s government. That includes public employee unions that have become corrupt and unproductive and gone over to the dark and oppressive side.
– As for Greek taxes, they tax ordinary working folks at a too heavy level, something like 50%. Their VAT (like Sales tax) is about 20%. Decency and respect for Greek workers has to include cutting the taxes levied on THEM.
– BTW, isn’t it curious how many people can’t find jobs in workers’ paradises, and immigrate to the oppression found in capitalist nations to try to find a job? [Even if it is just landscaping at the estates of rich people…] Why is that?
– 2nd BTW. You should reread a pamphlet sized history of the USA. You wrote “There is a reason why Roosevelt put an end to this in the early 50s,” Ah, but Franklin Delano Roosevelt had died in 1945, and the early 50s was the age of Eisenhower and Taft-Hartley.
Good post but your 30-40-50 should read 10-20-30.
The quote…“Greece might discover, like many other nations have, that cleaning its own governmental house and cutting taxes will get the economy going again.” is not from this article as the author is clearly against this. In fact the author is suggesting that a new currency should be adopted in which all taxes will be required to be paid in the new currency thereby giving the new currency legitimacy. This is similar to what happened in the U.S. after achieving independence from England in the late 18th century. At first Americans were terrified of losing the Pound and being forced to pay England in Pounds for any imports. But eventually the U.S. dollar became an acceptable form of currency which translated into true independence for the new and struggling Republic.
The author is promoting a form of socialism and a break form the mainstream capitalism that has bankrupted the country. This is an intelligent plan, but it will face huge resistance from the 1% particularly the wealthy Greeks who live there.
Free trade is a whole lot of BS. I am living in a major European country where many key industries have been liberalised and in the end sold out to foreign state-owned companies. The laughable result is that we transitioned from a capitalism controlled by our own government (for unfit or corrupt that it may be, at least we have some slight form of control on them through the vote) to another sort of capitalism controlled by foreign governments, which in most cases are not European and are definitely not the kind of governments you would want to have to deal with as a private citizen.
Some religions are said to lead believers to do stupid things: the free trade/market religion is no exception.
I completely agree - we are seeing that more and more in the US as well, though our “own” corps have done a pretty good job of screwing us over already …
Because they’re not “workers’ paradises”. They’re just feudal kingdoms with a different coat of paint, just like the US, Britain, and all the other countries where Capitalism is the real state religion.
Any time you hear of a “People’s Democratic Socialist Republic of Foo” you can be damnsure it’s not democratic or socialist, barely a republic if at all, and the people don’t have a damn’ thing to say about how it’s run.
For contrast, Sunday March 22nd I saw and read article ‘Greece could rise to Greatness, Or become the next Venezuela’, by Nathan Lewis, Forbes Magazine, March 19 2015.
Quote: “The lowest-earning people in Greece face a VAT of 23% and a combined payroll tax of 44%. If you manage to somehow make 26,000 Euros in the course of twelve months of labor you then get to pay another 32% income tax rate on top of all that. No private economy can function properly under these conditions, so we find that it either functions improperly, via tax evasion and avoidance, or not at all.”
– The writer spends several paragraphs discussing how this leads to everyone attempting to attach themselves to a government teat. That is, the right to take money or expect money from someone else. Currently their society is not at all admirable. Everyone who can has put their money where Greeks can’t latch on to it. The current parasite’s hosts are the German taxpayers. (Trivia FYI: the word ‘parasite’ comes from Greek.)
– In a different article I saw in the past few days, (Sorry, don’t remember the title or author) the writer compared Greece with Japan. Greece’s problems are small potatoes compared to the problems Japan was facing in 1949: cities reduced to rubble, hyperinflation and a population on the brink of starvation. Japan found a way back then. (Japan has lost their way since 1993.)
BTW, I see that Greece is still in the news, mid-July 2015, for all the wrong reasons. I personally don’t care how Greece solves their problem(s). I do suspect that attempting to seize wealth is emotionally very satisfying, but they still have to earn some money. As happened during the French Revolution. In the middle of the Great Terror Paris starved, because threats by the government would not induce farmers to deliver food to the city.
– I note that Thomas Hobbes and Adam Smith both noted that the natural condition of man is ‘impoverished’. I note that the Greens who are liked by so many at Common Dreams believe that we should live lives of voluntary ‘low standard of living, a.k.a. impoverished.’ …
Where does Smith say that? I can’t recall anything similar in his work.
No, not “the US”, just “the US working class”. The owner class is doing ever-better.