What's going on in Greece?

Mass protest outside the Greek Parliament in Athens on Wednesday

On Thursday evening, the Greek Parliament voted through its latest austerity package – approved by all but one of the deputies from the ruling ‘social democratic’ party, PASOK. Tens of thousands of workers will now suffer dramatic wage cuts of 40%, the slashing of pensions and the tearing up of collective bargaining agreements, on top of tax hikes and 20% unemployment (youth unemployment being nearer 50%).

In reality, the real authority in Greece is now the ‘Troika’, meaning the IMF, European Commission and European Central Bank. These three institutions are holding the Greek government hostage, demanding the complete destruction of the country’s public sector in return for the continuation of the €110bn bailout package which is keeping the country afloat, if far from stable. Greece can now keep paying its bills for a few months more, but a default on their national debt in the not too distant future is still almost certain.

Wednesday and Thursday saw the biggest days of action against austerity in Greece so far. Huge numbers were on the streets across the country, as hundreds of thousands of private sector workers joined the strikes for the first time. There were chaotic scenes in Athens, as stewards from the Stalinist trade union federation PAME clashed with other demonstrators. Amid the chaos, a PAME supporter died – although reportedly from breathing difficulties caused by police teargas.

The world economy is in crisis: Greece is the testing ground – and austerity isn’t working. By forcing ever deeper and harder cuts – this is the third drastic, emergency austerity package pushed through the parliament this year – the government is facing the growing contradictions of the system. Minus 7 percent “growth”  is not going to cure the deficit. A default is probably on its way, and has actually already happened to a limited, controlled extent: Greece’s creditors have already accepted that they’ll only ever get back 79 cents for every euro lent. However controlled or uncontrolled the default turns out to be, the impact on northern European banks, and the Euro, will be profound, and there’s a risk the ‘contagion’ could spread to Spain, Italy and Portugal.

Greece has entered a situation where the vast majority of the population have lost all faith in the political system and the government, who cling on through necessity to implement the orders of the Troika. Class war is being raged by the elites, meaning the absolute destruction of welfare and living standards, plunging millions into poverty. The economist Paul Mason has described what’s happening in the country as “anomie”, meaning the gradual breakdown of social order through the effective withdrawal of the state from public life: schools without textbooks, mass unemployment, general lawlessness and, among swathes of the population, little hope that anything can get better – as summed up in this report from a few weeks ago.

Europe is watching: Greece was first, but will not be the last. Organise, counter-attack!