Round 1 in Europe’s social struggle


March 10th, 2010

When thousands of Greek workers walked off the job last week in the first general strike since the government began announcing austerity measures, most of the world greeted it as an inevitable consequence of public spending cuts and tax hikes.

Not so Die Linke (The Left) in Germany, whose MPs and MEPs issued a statement expressing solidarity with Greek workers and condemning the European Union and its member states for forcing Athens to take such drastic action. The left-wing party is becoming an increasingly significant voice in European politics after making a breakthrough in last year's federal elections in Germany. It improved its share of the vote to 11.9 percent, upping its representation in the Bundestag (German parliament) from 54 to 76 seats, making it the second-largest opposition party.

Die Linke also has eight MEPs. Athens Plus spoke to one of them – Jurgen Klute, a former theology professor who is a member of the European Parliament's Committee on Economic and Monetary Affairs – to find out why his party thinks Greece is being made a scapegoat.

Last week, Die Linke issued a statement in support of striking workers in Greece. Why did your party take such action?

We have the strong impression that European leaders are currently trying to make an example of the so-called Greek case. However, when implementing the European Union's demands, the Greek government risks effectively downsizing its economy for many years to come.

In fact, in the Greek strikers' determination not to pay for a crisis they are not responsible for, we see the first part of a decisive social struggle all over Europe.

In its statement, Die Linke mentions Greece being a "victim of machinations." In what way do you think Greece is being targeted?

It is obvious that there is a campaign going on against Greece that aims at isolating the country. Greek politicians are being targeted for having presented untrue balances, which is particularly implausible as we learn that insiders in Brussels have tolerated this practice for years. Therefore, when European leaders point at visible internal problems, such as corruption and ineffective taxation, they try to isolate the country and hide that the dominant EU economic model of liberalization, privatization and export orientation is actually responsible for a lost decade.

The Greek government has highlighted the damaging role of international speculators. What effect do you think they have had?

When seeking fresh capital, European countries heavily depend on private actors operating on international financial markets. Both banks and rating agencies are exclusively interested in maximizing profits in the short term. In order to foster sustainable development, we therefore ask for two things: Firstly, eurobonds need to be introduced by the European Central Bank. Secondly, financial market authorities need the right to suppress harmful financial practices.

The counterargument to this would be that investors will always look to make a profit, so it's up to governments not to give them the opportunity to be their victims. Isn't the Greek government responsible for allowing itself to be exploited by the markets?

What seems true to me in this aspect is that it is not helpful to debate about the crisis in a purely moral way. On the other hand, the free movement of capital is one of the key principles of the Common Market. So the EU needs to introduce strong and effective solidarity mechanisms so that speculators will have fewer incentives to speculate against small economies.

In addition, hazardous financial operations should not benefit automatically from the Common Market principle of free movement of capital. In any case, it is crucial to remember that national government options are heavily restricted in the field of financial policy.

Die Linke suggests that the European Commission and neoliberal European governments are using the crisis as an opportunity to cut wages and increase retirement ages. If this is the threat, what is the response?

In October last year, the European Commission issued a paper on the longterm sustainability of public finances. Accordingly, last year's fiscal stimuli and rescue packages for banks will very soon be financed by cuts in pension and social insurance systems. This proves in my view, that the EU's demands of the Greek government have nothing to do with a fitting and sustainable solution for the Greek economy.

Furthermore, proposed massive wage cuts contradict every accepted sense of justice and are therefore not likely to be an effective tool against corruption problems.

Some might argue that it is only right that wages and pensions be cut because Greece has been living beyond its means – would you disagree?

The ECB targets an inflation rate of less than 2 percent. This means that, every year, wages need to increase by 2 percent, as well. If not, living standards for employees decrease. This has been the case in Germany, which has made small countries pay for competitiveness gains based on unfair wage dumping. Public pension cuts are also an enormous development program for private pension funds that will further boost the oversized financial market. This certainly is no way of preventing bubbles in the future.

The government now imposing these measures in Greece is a center-left one and has a long socialist history. If PASOK cannot resist these changes, then doesn't it send the message that there is little the left can do to halt this process, to present a credible alternative?

Unfortunately, EU treaties set a very tight frame for national economic policy. For eurozone members, there is no democratic influence on key aspects such as the currency's exchange rate or monetary policies. If left-wing governments are serious about their goals for a better life for their citizens, they imperatively need to build up European alliances in order to exercise influence in Brussels and Frankfurt, where the ECB is based.

As someone who used to teach peace education and intercultural dialogue, what is your view of the row that has broken out (mainly in the media) between Germany and Greece as a result of the crisis?

Usually, politicians claim that 60 years of peace between EU members is a result of economic integration. However, during the last decades, rigorous competitiveness policies have been accompanied by a lack of common social standards. Especially among the European middle classes, there is a growing and wellgrounded fear of social degradation. I think this is why nationalist and racist tendencies in public opinion are getting constantly stronger everywhere in Europe.

Some Greek politicians and journalists have raised the issue of German World War II reparations. Do you think this is a valid argument or does it appear just to be a side issue that distracts from the main problem?

It certainly is a legitimate question why Greek resistance participants did not benefit from World War II reparations. On the other hand, it is unlikely that it will be helpful to introduce this aspect in the current debate; rather it is a question to be discussed apart, in a less emotionalized context.