Greece: The Troika demands Tsipras’ head on a plate

As the referendum approaches, political polarisation is reaching unprecedented levels in Greece. Events in the last 48h have revealed the sham of bourgeois democracy, as the Troika is not prepared to accept the Greek government’s willingness to make concessions and demands Tsipras’ removal. The conclusion is unavoidable: there is no way to end austerity within the limits of capitalism, and even less within the strait-jacket of the German dominated capitalist eurozone.

On Monday, 29 June, there was a huge OXI (NO) demonstration which opened the campaign for the referendum. The mood was very angry but also confident. The size, mood and composition of the rally was similar to those back in 2011 at the beginning of the Syntagma Square movement.

This was against the background of massive pressure by the Troika. All its leaders, the hated Merkel, Schulz, Juncker, Schäuble, etc. had lined up to insist that the Earth was going to open and Greece plunge into hell if the Greeks dared vote no. They accompanied these threats with punitive actions. The Greek Finance Minister Varoufakis had been expelled from the Eurogroup meeting. The ECB had decided to cap liquidity aid to the Greek banks in what was clearly a politically motivated vengeful decision. This was designed to cause maximum fear and uncertainty in Greece as the ECB knew perfectly that it would force the Greek government to close the banks and impose capital controls. There was no legal reason behind the decision, as Greece is still a member of the euro-zone and at that time the bail-out agreement was still current.

However, the show of strength at Syntagma Square was followed by two days of contradictory statements and moves on the part of the Greek government. After all requests for a temporary extension of the current bailout were rejected, the Greek government put in a request for a third, 29bn euro bailout from the European Stability Mechanism (EMS). This gave rise to a flurry of speculation, new emergency meetings, summits and conference calls were convened.

oxiHowever, Tuesday June 30 ended with no significant news regarding the negotiations. The bailout program expired and Greece did not make the 1.5bn euro payment due to the IMF. That same night Tsipras sent a letter to the Troika which was leaked by the Financial Times on Wednesday, July 1, in the morning .

The letter contains further concessions on the part of Tsipras to the Troika. What were the contents of the letter? It basically said it accepts the Troika’s proposals of June 28 (which are basically the same that the Greek government rejected when negotiations broke down on Friday June 26), with some “amendments, additions and clarifications”. Of the amendments proposed, most of them are a question of timing in the implementation of different measures (not an unimportant issue, but not one of substance). The only substantial difference seems to be the insistence in maintaining the VAT discount for the Greek islands which had been a contentious issue.

The letter also links the acceptance of the proposal (with some modifications) to a temporary extension of the second bailout and discussions about the request for a third bailout. Basically, the government was saying: we will accept almost all of the Troika’s demands if they are prepared to discuss debt relief and restructuring.

This is a major climb down. On Friday, when Tsipras announced the referendum, he explained that the difference between the Troika’s ultimatum and his own June 22 proposal of an 8bn euro package, was that the Troika wanted to make the weaker bear the whole load. His own proposal, he explained, was fairer, as it included a substantial amount of money to be obtained from the capitalists through the increase of corporation tax and the one off tax on profits. In the June 30 letter, he is giving up on all of that. The rate of corporation tax proposed by the Troika would be accepted, the scrapping of the one-off tax on profits demanded by the Troika would be accepted and the time-table for the phasing out of EKAS (the top up subsidy for poorer pensioners) would also be accepted.

Let us not forget that the June 22 Greek government proposal, the 8bn euro package, already contained major concessions which broke some of the government’s own “red lines”. All of this in exchange for talks on debt relief and restructuring.

Not only this, but vice prime minister Dragasakis, firmly on the right wing of the government, also hinted in an interview to state broadcaster ERT, that the decision to call a referendum was political and therefore if conditions changed the decision could be changed.

The Troika had insisted that the only way to discuss debt relief would be if the Greek government either cancelled the referendum or campaigned for a YES vote. All of this naturally gave rise to a lot of speculation that the government was changing its position and that the referendum itself was in doubt.

Then, the German government stepped in to quash any hopes of an agreement. In an extraordinary session in the German parliament all the government heavy weights were brought in to press a strong and unequivocal message. There would be no further talks with the Greek government before the referendum on Sunday. Not only that but they said, openly, that they do not trust the current Greek government, and do not intend to hold talks with it. Schäuble’s words were clear and left no room for misunderstanding: “the present Greek government is not a very trustworthy party for new bailout talks,” and he added “this administration has been in power for five months and done nothing but negotiate and negotiate”.

This is a scandalous state of affairs from the point of view of formal bourgeois democracy. It is up to the Greek people to elect their own government and theoretically Greece is a sovereign nation. But here we have the German capitalists telling the Greek people “we do not like the government you have, it has done nothing to meet in full our demands and therefore it must be removed”.

There’s no other way of interpreting his words. And of course, these are not just words. Germany, being the most powerful capitalist nation in the EU, is the master. It holds the strings to the purse and is already using it to asphyxiate the Greek banks in the hope to force the Greek people to make “the correct choice”.

Of course, none of this should be a surprise to Marxists. We are fully aware of the sham of bourgeois democracy (where the capitalists rule) and international relations (where the strong impose their will). What we are seeing is this fact being revealed to the eyes of millions, discrediting the very essence of bourgeois “democracy” for what it is.   

It wasn’t just Merkel’s right wing Christian Democrats leading the charge against Tsipras and Syriza. Their “social democratic” partners, as always happens, felt the need to show off and demonstrate their loyalty to the interests of German bankers and capitalists. Vice-chancellor Sigmar Gabriel launched a blistering attack against Tsipras and warned that Germany would not continue to “throw money at this corrupt state” and that “nobody can expect conditions for the next programme can be easier than those we have already discussed.”

This is the language of war, not that of compromise. Some are reasoning in the following way: the Greek referendum is a win-win scenario for the German rulers now. If the NO wins, Greece will be out of the euro. If the YES wins, they will get rid of Tsipras.

If anything, the events since the referendum was called a week ago have confirmed what the Communist Tendency of Syriza has argued all along: an honorable deal with the Troika is not possible. Or to put it in another way, it is not possible within the limits of an extremely weak and crisis ridden capitalist Greece to fulfill the democratic mandate of the people on January 25 to put an end to austerity. There is a fundamental contradiction between capitalism and what the Greek people want after 4 years of brutal cuts and frightful collapse in living standards.

However, the idea that a deal with the Troika was possible, one which would accommodate the program of social emergency measures Syriza proposed, was the basis of the whole strategy of Syriza’s leading group. And it still is. It is this fact that explains the apparent vacillations of Tsipras and the Greek government. They do not have an alternative plan. They want to remain in the EU but without austerity. The whole experience of the last five months proves that this is not possible. If there was any doubt, the last five days should have dispelled it.

In response to the German refusal to even contemplate his latest proposal (which was then ratified by the conference call of the Eurogroup Finance Ministers, minus Varoufakis), Tsipras made a televised speech in which he reaffirmed that the referendum was going ahead and urged a strong NO vote.

He did that, by denouncing the “blackmail” of the Troika and correctly blamed “the institutions” for the Greek bank closure which was putting pensioners and other people in a very difficult situation. Still, he remains completely wedded to the idea of an agreement. He explained how the very fact of calling the referendum had already produced a better offer from the troika and that a NO vote on Sunday would ensure a good deal.

This is a view which has no basis in reality. Events in the last two weeks have set in motion a chain of events (expiration of the bail-out, non-payment to the IMF, breaking down of negotiations and trust, etc) which make any deal even more difficult.

The aim of the ruling class now, in Europe and in Greece, is clear: to remove Tsipras from office, as they have not managed to get him to sign a humiliating surrender. This they are attempting to do through a combination of means, legal and illegal. Let’s look at their methods.

There is a brutal campaign of terror on the part of the media, which has reached the level of lies, scare-mongering and distortions of the Venezuelan one and for the same reasons. The ruling class is using their almost complete domination of the print and TV media to spread a message of fear. One newspaper published a picture of an old man clutching a loaf of bread with a desperate expression on his face to illustrate the plight of pensioners not able to withdraw their pensions. The picture was from the 1999 earthquake in Turkey! “If the people vote NO, Greece will be ejected from the euro and we will plunge into a situation like that of Bangladesh or Pakistan” is one of the dominant messages of the YES campaign, combining fear with racism towards immigrants from those countries.

TV adverts are heavily dominated by the well funded YES campaign, which also has the support of the Orthodox Church hierarchy as well as the Olympiakos club. An analysis of news coverage of the NO and YES rallies this week in the main TV stations produced shocking results. Overall, the NO rally received 8.3 minutes, while the YES rally the day after received 47.23 minutes. The only balanced channel was the state broadcaster ERT, giving both rallies almost exactly the same time, while the powerful SKAY didn’t even mention the NO rally while giving over 7 minutes to the YES event .

yesClick on the image to enlarge

They are also exerting pressure on the right wing of Syriza, those who want to cancel the referendum and are prepared to reach an agreement with the Troika regardless of the terms. Some of them have already come out publicly against the referendum. Others will follow as pressure intensifies. They hope to create open cracks within the government with the intention of bringing it down.

Pressure is also being exerted on government partners in the right wing populist ANEL. The insistence on further cuts in defence spending (a portfolio held by ANEL leader Kamenos) and withdrawal of VAT reduction for the islands (a “red line” for ANEL), go in that direction. It is not ruled out, as pressure intensifies, that ANEL might break the government coalition. (NOTE: as I finished writing this article it was announced that four of the party’s members of parliament had joined the YES camp).

The right wing president of the Republic, Pavlopoulos, appointed by Syriza as a gesture to the European “partners”, could also be used in a situation of emergency to dismiss the government and create a new one, a “broad front of democratic forces” as he described it. A government of national unity, before or after the referendum, composed of “pro-European” (read pro austerity) forces, including a section of Syriza itself, is one of their gambles. Let us not forget the way Papandreou was removed from office and replaced by the unelected Papademos when the former suggested putting one of the Memorandums to a referendum.

There are also widespread reports of intimidation of workers by their employers. Threats of sackings, withholding of wage payments, etc in order to force them to attend pro-YES rallies and vote YES on Sunday.

There are also attempts to de-legitimise the referendum itself. The European Council of Human Rights for instance issued a statement saying the Greek referendum “did not meet international standards”. What they are really saying is: “it is not within international standards to ask the people to take a decision on an important matter like this, as they cannot be trusted to get the correct result”.

This is part of an insidious campaign based on class hatred to say that the people are ignorant and shouldn’t be allowed to vote. The question is too complicated, they say. The question in fact is very clear and everyone has understood what it means: do you agree with the latest ultimatum from the Troika. When they say that the people cannot understand it, what they are really saying is that those voting NO are stupid, otherwise they would vote YES.

On top of all this they of course want to create a situation of economic chaos and dislocation, promoting panic buying, magnifying problems at ATMs, creating scarcity of basic food products and medicines, etc. Part of this is the result of a deliberate campaign of sabotage, another part is the logical consequence of capital controls.

All of these things remind us powerfully of the battles waged by the Bolivarian revolution in the last 17 years, in Venezuela and internationally. The same social class forces lined on each side of the divide, the acute political polarisation, the dirty tricks of the ruling class, but also the powerful increase in the level of political awareness of the masses of working people.

It is enough to hear any of the interviews with working people on the ground and the reasons why they will vote NO, to understand that they understand very well what is at stake.

Faced with this massive campaign by the ruling class in Greece and abroad for the YES, the NO camp cannot be seen as vacillating. The people are ready for a fight, but the worse thing that could happen is if they see the generals in their own camp wobbling, making concessions, trying to reach a peace deal in extremis on dishonorable terms. That would only provoke demoralisation, sow doubts and finally lead to defeat.

The very idea that a NO vote will lead, almost automatically, to a better deal, which has been repeated today by Varoufakis, is very dangerous in these conditions, as many people understand that this is not the case.

The NO campaign has to be based on providing clear political answers to the arguments of fear of the ruling class. It has to be based on popular grassroots mobilisation to counter the power of the mass media. It has to counter the threats in the workplaces through collective action, with mass assemblies, introducing workers’ control and vigilance.

The government should respond to threats of sabotage of the food and medicine supply by introducing state intervention and control by workers’ and consumers. Monopoly of foreign trade would also be a necessary defensive measure to deal with threats of economic sabotage.

The banks should be nationalised in order to protect the deposits of working people and pensioners.

Only by waging a campaign by revolutionary means, based on neighbourhood and workplace OXI committees can this battle be won.

In this context, it is necessary to wage a serious campaign aimed at the KKE to demand it abandons its criminal position of a spoilt ballot. This is a crucial battle and the result might be close. We can’t afford to lose a single vote. The KKE should not be asked to suspend its criticism of the government’s strategy, ideas and concessions to the Troika. However, when the question is posed point blank: do you accept the Troika’s ultimatum or reject it, there is no room for ambiguity. A recent opinion poll showed that 57% of KKE’s voters would vote OXI (NO) showing how the arguments of the leadership are rejected by a majority of its own followers.

Finally, the international labour movement must be brought into this battle. This is not just about the fate of Greece. The result of the referendum will have implications for the struggle against austerity and capitalist crisis across the continent.

This battle, however, cannot be fought effectively on the basis of the idea of a new, better, “socially fair” deal with the Troika. We must explain patiently but forcefully, that the only way to fight austerity is to break with capitalism.