Sunday

3rd Jul 2022

Opinion

Europe commits suicide in Greece

"I feel betrayed" said European Commission president Jean-Claude Juncker after he learned that Alexis Tsipras, Greek PM, had announced a referendum on the international support programme for Greece.

Many European politicians feel the Greeks have brought this misery onto themselves. An image that most mainstream media across Europe uncritically embraced over the past five years.

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  • An estimated 90% of the €240bn that Greece borrowed in 2010 went to foreign, primarily German and French, banks. (Photo: Barcex)

No matter what European country you are in, if you ask the man on the street about the situation in Greece, you will likely hear it's their own fault.

Yes, corruption and clientism are a problem in Greece. But the role of the international sector headed by Goldman Sachs and German and French banks played a significant part in the country’s debt crisis.

On top of this came German defence companies which found a good market through bribes as Greece bought their products at inflated prices.

Afterwards billions of euros were needed throughout Europe and Greece to rescue banks which had speculated in financial markets.

In the case of Greece they knocked on the door of International Monetary Fund (IMF). Since it is an EU country, the IMF wanted the European Central Bank (ECB) and the European Commission on board.

Involvement of the Washington-based institution means a country loses its sovereignty – the IMF dictates its policies.

The reforms imposed by the Troika of creditors in Greece are neoliberal as they involve the privatisation of public services; austerity measures and the dismantling of the welfare state.

It creditors argue that Greece would come out of the crisis, reduce debt, boost the economy, reduce unemployment if only it reformed.

Results?

No other country in Europe has carried out more reforms than Greece - but what have they achieved five years later?

Greece is still in a deep crisis. Debts continue to grow. The average Greek became 40 percent poorer since 2010. Unemployment has continued to grow; youth unemployment is at 60 percent. Wages continue to fall and the middle class is disappearing.

What about the €240 billion that Greece borrowed in 2010? An Estimated 90 percent of it went primarily to German and French banks. Not to the Greeks.

That is why the Greeks massively voted for Syriza, a leftist party that does not want to simply accept the imposed reforms. Syriza is reclaiming the sovereignty and dignity of the Greeks by demanding a say in negotiating the reforms.

Europe

As Tsipras refused to accept these neoliberal reforms he has become the bogeyman for European politicians, media and opinion makers.

For some he is even a coward who turned his back on Europe. Whenever a country does not do what the European institutions demand then they are considered against Europe.

This is the easiest way to discredit and subdue every voice opposing the current neoliberal policies.

This is about more than Greece. It is no coincidence that the Spanish Prime Minister Rajoy of the centre-right wing Partido Popular is calling for Tsipras to step down.

If Tsipras gets his way, it will boost Spain’s own left-wing party Podemos, which also wants an end to austerity.

The absurdity is that recent secret documents from the IMF acknowledge that austerity measures would still leave Greece with unsustainable debt.

This analysis is also shared also by leading economists Paul Krugman, Joseph Stiglitz and Thomas Piketty.

And yet, the interests of the financial, industrial and political elite take precedence over those of ordinary citizens. Is this the kind of Europe we want?

Bleri Lleshi is Brussels based political philosopher and author of various books. You can follow him on Facebook and Twitter.

Disclaimer

The views expressed in this opinion piece are the author's, not those of EUobserver.

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