It's not Greece. It's Capitalism, stupid!

March 2, 2012 by Mottas

The ongoing crisis in Greece consists the epitomy of Capitalist policies's failure in Europe.

If Karl Marx could see the recent developments surrounding the Greek crisis he would certainly feel vindicated. Last Tuesday, the IMF and Eurogroup were trying for hours to reach a deal regarding Greece's new bailout package. In the name of avoiding default, the Greek people will now have to face a new round of extremely harsh austerity policies. But, in fact, it wasn't the country's bankruptcy which the leaders were trying to avoid; the real deal in Brussels was - and still is - to keep alive, at any cost, the politico-ideological corpse of the actually existing Capitalism.

For more than three years now, most international media and analysts refer to a "debt crisis" combined with financial mismagement by domestic governments. This is misleading. The actual truth is that the profoundly unfair and immoral capitalist system we live in - the one which supposedly "thriumphed" over marxist economics, as neoliberals and keynesians use to argue - is the source of it's own crisis. Who can argue that the ongoing crisis, which started with the Lehman brothers scandal in 2008, isn't the worst episode in a series of free market economy failures since the Great Depression of 1930s? In Europe, as well as internationally, the ruling elites are aware of that, thus making every possible effort to put the weight on people's back.

Today's Greece represents the epitomy of Capitalism's failure in Europe. The devastating results of this failure can be seen in the streets of Athens - in the increasing number of homeless people, in the agony of young men and women who cannot find a job even after two master's degrees, in the downgrade of citizens's living standards. The supporters of neoliberal practices and strick monetarism use to claim that Greece used to be "the last socialist european state". This is an outrageous lie. Greece, like her fellow EU members, was always a Capitalist state, functioning under the rules of free market economy. Between 1990 and 2007, a period during which Greece - governed by both conservative and social-democratic majorities - co-signed the notorious Treaties of Maastricht (1992) and Lisbon (2007).

Let's see some facts which are quite revealing about Capitalist dominance in Greece during the last two decades:

  1. In 1990, the GDP of Greece was 38,000,000,000 euro. In 2007 it became 208,000,000,000 euro, thus being increased five times more.
  2. In 1990, the profits of the companies (both S.A. corporations and L.L.C companies) were up to 575,000,000 euro. After 17 years, the profits of the Greece-based companies had been increased 28 times thus reaching the 16,000,000,000 euro.
  3. While the profits of the private companies were reaching the above extroardinary numbers, the increase in the daily basic salary of the unskilled worker was just 15 euro.

For a period of almost 20 years, while the working people of Greece were contributing to the expanding of the country's GDP - and to the maximization of the profits of the Capitalist elites (28% in 17 years) - the lowest standard salary increased by just 1%. In fewer words, the period from 1990 to 2007 seems to be a period of continuous profitability for the Capitalists while, on the same time, the actual income of the labour classes remains the same as it was in the decade of 1980s. That seems to be part of the price the low and middle classes had to pay for Greece's ambitious aims in the 2000s: the Athens Olympic Games and the participation in the core of the E.U.'s neoliberal experiment - the eurozone.

However, there are still people who regard Greece's membership in the European Economic Community - known as the European Union since 1993 - as the modern "great achievement" of Greek politics. But who really benefited all these years from this membership? Was it the lower and middle classes of the country or specific financial elites in Athens and Brussels? Numbers are quite revealing: (Rizospastis, 12 May 2009).

  1. In 1980 (a year before Greece's accession in the EEC) the country's trade balance towards the rest of the world was 5,200,000,000 euro. Twenty-eight years later it had reached approximately 44,000,000,000 euro.
  2. In the period from 1980 to 2008 the deficit of Greece's agricultural balance increased by 934%. Only during the first year of euro's introduction (2002-2003) the agricultural deficit of the country, related to the rest of the world, increased by 74%.
  3. Greece's foreign lending: From 1990 to 2000 it increased by 931% (!). In 1980 the Greek public debt was 600,000,000 euro while 19 years later, in 2009, it reached the unprecedented number of 298,000,000,000 euro, thus being increased by 497 times.
  4. During the last years there is a propaganda about Greece's benefits from the notorious "community packages" - structural funds that the Greek governments received from Brussels, since 1980s, within the frame of Europe's regional development policies. The total amount of community packages that Athens received in the period between 1981-2009 reaches 43,000,000,000 euro, which seems to be a considerable number. Nonetheless, it's very few related to the trade balance deficit between Greece and the EU. During that the last three decades Greece's imports were approximately 379,000,000,000 euro while the country's exports only 125,400,000,000 euro. (Greek Statistical Service, Bank of Greece, Rizospastis, 20.12.2005). In fewer words, Greece indirectly paid back six times more the money she received from Brussels. As German economist Heiner Flassbeck pointed out "Germany's surplus is the deficit of her partners".

There is no doubt that corruption consisted a major component in Greek politics' failure all these decades. But we should ask ourselves: Which is the system that promotes and advances corruption? Isn't the Capitalist system which "prepares the soil" for the interweaving of multinational corporations (see: 2008 Siemens scandal) with the political elites? Furthermore, there is a tragic irony: the present un-elected Prime Ministers of Greece and Italy (Lucas Papademos and Mario Monti) are both former bankers, who worked in the past for multinational buldge bracket investment firms.

Today, a "troika" consisting of the Greek government, the IMF/EU block and Greece's lenders ask from the people to pay until the last drop of their blood. Without any plan for the country's future development, the lower and middle Greek classes are called to rebuild the ruins of Capitalism. Those who are responsible for the crisis now point their fingers to the working class, thus putting on the table outrageously fake dilemmas: Austerity or bankruptcy, neoliberalism or disaster.

The Greek crisis, despite all it's tragedy, became a chance. It gave the opportunity to practically question a political and economic establishment which Francis Fukuyama had called "the final form of human government" (The end of history and the last man, 1992). More than 80 years since the Great Depression of the 20th Century, the foundations of Capitalism are trembling. The mass anti-austerity movements in Greece and Spain, the Occupy initiative in the United States as well as the Arab Spring consist proof that people start to wake up from the "hibernation" of Capitalism's illusive welfare.

The crisis in Greece provides the best evidence that the Capitalist model of governance has utterly failed and must be overthrown. It seems to be an extraordinary coincidence that Capitalism is collapsing in the place where, almost 2,500 years ago, Philosophy and Democracy were born.

Comments

It's not Capitalism. It's Greece!

March 5, 2012 by Jim Adams (United States ), 2 years 42 weeks ago

Points: -4

While Capitalism needs to reinvent itself after recent wobbly steps around the world, the problem with Greece Mr. Mottas is not Capitalism. The problem with Greece is that it is riddled with corruption, fraud and racketeering. And unless the Greeks get some political leader with balls, there is no economic system that can save them. And, by the way, Capitalism does not "promote and advance corruption" - nor does any other economic system. I think that's the motto that pseudo-leftists and "κνίτες" live by in Greece. I don't live in Greece.

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