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John Passant

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March 2010



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My interview Razor Sharp 18 February
Me interviewed by Sharon Firebrace on Razor Sharp on Tuesday 18 February. (0)

My interview Razor Sharp 11 February 2014
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Razor Sharp 4 February 2014
Me on 4 February 2014 on Razor Sharp with Sharon Firebrace. (0)

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And you thought neoliberalism was dead

A funny thing happened on the way to the Parthenon. Neoliberalism rose from the grave.

Not that it was ever really dead. It has just been resting, waiting for its Keynesian cousin to exhaust itself.

During the global financial crisis state spending replaced private spending in many countries. What that spending hasn’t done is address stagnant profit rates.

There isn’t a bottomless pit to fund state expenditure since the state depends on the expropriation of surplus from workers just as much as capital.

Greek governments – both conservative and socialist – have been spending much more than they collect in revenue.

This year government debt is over 12 percent of GDP. Accumulated government debt is around 120 percent of GDP.  

The Greek government funds this by borrowing. Some of the debt is due for refinancing soon and the bankers who bought us the global financial crisis are worried about the country’s ability to repay the debt.

This increases the amount of interest Greece has to pay, forcing more attacks on workers.  Last week the ratings agencies cut Greece’s debt rating again making borrowing even more expensive and prompting the socialist government of Papandreou to announce further attacks on living standards.

Despite all this Government spending, the Greek economy is in crisis.

Its unadjusted unemployment rate jumped in February to 10.6 percent. It was 7.8 percent in November last year.

For young people aged 15 to 24 the unemployment rate is nearly 30 percent.

The International Monetary Fund – the king of neoliberalism –  will provide guidance on the European Union bailout of Greece. It is of course a bailout that dare not speak its name. Its central theme is ‘destroy Greek living standards’.

In October the Socialist Party – Pasok – won the election on a keynesian platform that did not involve attacks on workers, jobs or living standards.

Within a month of taking power the economic crisis saw Pasok abandon every one of their promises and begin to attack workers.  It is working people who Pasok want to make pay for the bosses’ crisis.

Pasok has close inks with the trade union bureaucracy and so in the eyes of some members of the bourgeoisie it is a better agent for delivering big cuts to living standards than the conservatives.  Pasok is vindicating that judgement at the moment.

The latest round of attacks (because the banks deemed the previous ones inadequate) include 30 percent cuts to public sector workers’ annual bonuses, VAT  increases of 2 percent and freezing state-funded pensions.

Public sector wages are already frozen and the Government plans to cut them further, sack hundreds of thousands and cut services.

The keynesian soft cop has given way to the neoliberal basher.  They are one and the same person in Greece.

Henryk Grossmann, a Marxist economist, wrote about crises of profitability and political responses just before the great depression. He said:

Only now is it possible to understand why, at a high level of capital accumulation, every serious rise in wages encounters greater and greater difficulties, why every major economic struggle necessarily becomes a question of the existence of capitalism, a question of political power.(Note the English miners’ struggle, 1926.)

The struggle of the working class over everyday demands is thus bound up with its struggle over the final goal. The final goal for which the working class fights is not an ideal brought into the workers’ movement “from outside” by speculative means, whose realization, independent of the struggles of the present, is reserved for the distant future. It is, on the contrary, as the law of capitalism’s breakdown presented here shows, a result of immediate everyday struggles and its realization can be accelerated by these struggles.

Certainly the general strike in Greece last week, plus the ongoing and varied stoppages of public and private sector workers and the revolt of pensioners and students, all point to an intensification of the class struggle in Greece as the needs of capital directly confront the needs of workers.

To defend living standards is objectively to attack profit, and in doing that there opens up the possibility of a new world free of wage slavery and the ongoing crises of the capitalist system.


For more information on Grossmann, read Rick Kuhn’s Deutscher Prize winning book Henryk Grossmann and the Recovery of Marxism



Comment from Auntie Rhoberta
Time March 6, 2010 at 9:11 am

Well said!

Comment from Kieran
Time March 7, 2010 at 10:26 am

Keynes for the rich, “free markets” for the poor. Different sides of the same coin really.

Comment from Arjay
Time March 7, 2010 at 2:28 pm

John have look at Webster Tarpley’s observation that George Soros and Goldman Sachs are trying to use Greece as the weakest link in the chain to attack the Euro and thus strengthen the $ US.


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