Greece, Ideology, and Social Power

Here is an interesting article from the Economist concerning Greece.

I have been following this situation fairly closely, and although you wouldn't know it from watching the news/or reading the local paper, this situation is one of the key economic problems facing the world today. I believe this situation provides a window into the future and depending on how this situation is dealt with the problems in Greece have the potential to spread rapidly, with (additional) disastrous consequences for poor/working class people around the globe.

The problems in Greece are two fold. Due to its high level of public debt, deficit spending, and a relatively weak economy, Greece is having trouble raising money on world capital markets. The fear is that Greece will be unable to service its debt in the future, leading to a default, and lost profits to all those capitalists/governments who lent Greece money in the first place. In short, Greece is not a good long term investment, and is increasingly unable to finance government operations.

This has lead the Greek government, under pressure from those same world markets as well as the EU, to introduce increasingly draconian measures to curb public spending, and reduce its need to borrow additional money. The list of these measures is quite extensive but it includes among other things huge cuts to the public service (including massive layoffs and in some case up to 25% wage reductions), increasing the retirement age, and significant tax increases. This has lead to both internal duress and mass protests on the part of the Greek people, in addition to endless debate among the EU about how best to deal with this situation, and wether or not to provide some sort of financial relief to the Greek government.

What makes the situation in Greece particularly interesting to me is that it provides an acute example of two of the big problems facing the world today. As well as a remarkably clear example of Capitalist ideology at work. The two problems that the situation in Greece demonstrates are;

1. The erosion of state power, and its ever weakening position visa vie world Capital Markets/Capitalist Power

2. Economic Fatalism, or, ignorance of the economy as a political and social process.

Upon first glance, it seems easy to criticize Greece. Even without employing ethnic stereotypes, and believe me this discourse does play a significant role in the media's coverage of these events, it would seem that comparatively Greece has a relatively developed welfare state and a large public sector, without the economy to back it up. In a sense Greece is living beyond its means. In this discourse these austerity measures are simply a correction. A time for the Greek government to come to its senses and start acting like the rest of us.

However, this "critique" is fundamentally ideologically. It only serves to engage regular people in a fight with each other over table scraps while the rich make 3.6 billion dollars a year to steal from people and drink martinis on Wall Street. Rather than focus on the true nature of the problem, global income disparity of epic proportions, we blame the lazy Greeks for their decadent lifestyle.

And here is the one of the true problems that the Greek situation exemplifies. The various financiers and stock traders of the world have been able to force Greece into enacting policies directly against the interests of their citizens. Greece has been placed in a situation where the interests of private profit and finance capital trump the interests of regular people. The state, maybe just the Greek state but maybe all states, no longer has the ability to govern. Government is now performed by the financial market.

Secondly, if the above quoted article is correct, 2/3rd's of the Greek population support the governments austerity measures. They have bought the line and believe that, as the market dictates, they must pull up their boot straps and soldier on to rebuild their economy, loose the benefits they fought and died for, in the hope that, one day they can once again have the lifestyles the so recently possessed.

The austerity measures being enacted are not the dictates of the market, but rather the direct workings of human beings. The economy is a social process run by, and one would imagine for, people. There is no invisible hand whisking money around by some mystical force but rather the conscious decisions of individuals.

In this case, the people in question are not working for the public good, but rather in the interests of private profit. Explicit in the idea of the economy functioning as a social process is the idea that we can change it. As its only actors, humanity must work to create an economy where the interests of human beings are placed above those of interests rates, and balance sheets.

We have allowed the world to become what it is, and we are the only people who can, working together, change it for the better.