The Greek economy after one year of ND government

Article by A. Papariga,
General Secretary of the CC of the CPG
for the magazine “Greece is Everything”

The ongoing debate over the situation and the future of the Greek economy has recently become more intense. The occasion for this has been the disorienting confrontation between the New Democracy and PASOK parties regarding the expediency and consequences of the famous “stocktaking” undertaken by the government, with all that has ensued.

The misnamed confrontation in question serves two related objectives simultaneously: on the one hand it cloaks the identity between ND and PASOK as regards the basic directions taken by their anti-popular policies and on the other it obscures the true causes that generate the attack launched on the working people’s gains and rights. The common denominator of all those taking part in this project is, finally, their invoking of the need for the country’s “fiscal adjustment” at the expense of the people’s income for the sake of the competitiveness of Greek enterprises, along with the requirements of the community Stability Pact.

Life itself, however, belies the myth-making concerning the problems and stamina of the Greek economy. The country’s GDP continues to rise at a higher rate than the EU average. The growth of the Greek economy observed in the last few years has resulted in high rates of profitability for large groups of companies. Just in the first three quarters of 2004, the profits of companies listed on the Athens Stock Exchange skyrocketed to 6.9 b. euro.

Of course, this does not mean that during the next period the Greek economy can avoid a slump. There are already certain signs of this, if one also takes into account the rise in the loan burden on Greek households, investment in the trade balance and the course taken by the manufacturing, construction and tourism sectors.

The aforementioned must not, however, mislead us from ascertaining that essentially as regards the recent past and the future of the Greek capitalist economy the following holds: wealth is produced in our country and labour productivity is rising, but this is not leading to an improvement in the position of working people. On the contrary, year by year they are receiving a comparatively smaller piece of the pie produced.

A simple review of the new tax exemptions and additional incentive benefits granted to big capital through the new taxation and development law suffices to show that the government’s invoking of the need for fiscal adjustment is hypocritical and aimed exclusively against popular demands, even the most rudimentary ones.

Correspondingly, the directions set out in this year’s budget do not differ from the previous ones of PASOK governments, directions set, that is, before the famous “stocktaking”. These provide for the redistribution of wealth at the expense of popular strata and an acceleration in restructuring, that is, in market deregulation, the full commodification of social services and the privatization of strategically important sectors.

The new revised Stability Plan 2004-2007 to be submitted by the government to the European Commission will serve the same objectives yet more conscientiously.

The directions in question were not invented by the Greeks. They constitute an attempt to deal with the innate contradictions in the capitalist system and the difficulties it encounters in reproducing social capital in its entirety. These directions are determined and fine-tuned for all EU Member-States with the Lisbon Strategy and the proposals made in the ‘Barroso Manifesto” aimed for its more rapid and effective application. They are intended to reduce labour costs and to further reverse the retirement terms gained for working people in all Member States, at the same time expanding paid labour, that is, capitalist exploitation.

The promotion of this specific strategic direction has already had an obvious negative impact on the working class in our country, but also in the rest of Europe. It is manifested in the widening gap between any increase in pay and pensions on the one hand and the rise in prices and indirect taxes on the other. On the whole, developments confirm that the increase in labour productivity acts as a multiplier on corporate profits without improving the position of working people.

Capitalist profits have already reinforced the tendency towards the concentration of capital and towards mergers and the penetration of Greek companies into the Balkans. What we have here is the aggrandizement of the most powerful part of the capital that has come from the greater exploitation of salary and wage earners and the destruction of small businesses.

The promotion of capitalist “liberazation” of strategically important sectors, such as those of energy, telecommunications etc, likewise has an adverse effect on the people. The new steps taken towards privatization are accompanied by new burdens on popular consumption, a reduction in thousands of jobs in formerly state-owned enterprises and, in the light of popular needs, a negative impact on plans for future projects.

Government policy on public works moves in the same anti-popular direction. The priorities and procedures for the awarding of contracts and the design and construction of projects are selected with a view to meeting the needs of capital accumulation. With the promotion of the so-called co-financed projects, an attempt will be made in the upcoming period to subject the people to a double blood-letting, both as taxpayers and as users.

In sum, the working people have nothing to expect from either the present government’s policy or the misnamed opposition of PASOK. The great wager for the Greek people is whether they will fight for the satisfaction of the whole of their needs against the demands of the ruling class of the country and against EU guidelines.

We propose to the working people a comprehensive framework for struggle which responds to the offensive launched on all fronts by capital and which lays foundations for overall demands regarding the people’s income, worktime and exclusively public and free healthcare and education.

We call on the people to dynamically come to the forefront to blaze a different path for the evolution of Greek society, a path in which the basic means of production will belong to the people, central nationwide planning for economic life will be set up and worker’s control will be established so that the popular needs will be met sufficiently.