“You can’t? We can!” Workers at Mining Industry factory in

Northern Greece vote for and prepare for self-management of

their factory – victory to the workers!

See original article from Occupied London

Concerning the struggle at VIOMIHANIKI METALLEYTIKI (Mining Industry) in Thessaloniki

The administration of VIOMIHANIKI METALLEYTIKI, a subsidiary of Filkeram-Johnson, has abandoned the factory since May 2011, along with its workers. In response, the workers of the factory abstain from work (epishesi ergasias: the legal right of workers to abstain from work should their employer delay their payment) since September 2011. The Workers Union at Viomihaniki Metalleutiki has organised 40 workers all of which are, to date (one year after the closure of the factory) active, taking shifts at the factory to ensure that no equipment is removed by the administration or stolen. All the workers also participate in the General Assemblies.

The proposal of the Union in order to escape this dead end – as the Administration has stated the factory will not reopen, due to the lack of funds – is for the factory to go into workers control, a proposal voted by 98% of the workers at the General Assembly. More specifically they ask for the factory to be passed on to the workers and for all the members of the Administration and workers sitting in the administrative council to resign, with no claims from the future workers’ self-management of the factory.

In regard to the initial capital, which is necessary for the operation of the factory, the proposal of the workers is for the Greek Manpower Employment Organization (OAED) to pay them in advance the sums they are already entitled to after becoming redundant.

Finally, the workers at Viomihaniki Metalleutiki demand the introduction of legal status for co-operative enterprises, in order for their own and for future initiatives to be legally covered.

In the struggle of the workers of Viomihaniki Metalleutiki, apart from the self-evident value that we see in every workers’ struggle and every workers’ demand, we also recognise an additional value, which comprises exactly of this proposal of self-management. We believe that the occupation and the re-operation of factories and corporations by their workers is the only realistic alternative proposal in face of the ever-increasing exploitation of the working class. The self-organisation of factories that close down is the only proposal that has the force to mobilise the working class – which, living under the constant threat of unemployment, cannot see ways in which it can resist.

We know that the difficulties we shall face in the struggle for the self-management of the factory are many, since state and capital will fiercely stand against it – as a possible victory shall create a precedent and and example for any other struggle in the country. Yet the question of whose hands the production lies in becomes a question of life and death for a working class pushed into degradation. For this reason, the workers’ struggles orientated in this direction and the forces standing in solidarity to these struggles should be prepared to clash with state and the administration in order to materialise the occupation of the means of production and the workers’ self-management.

We call for every union, organisation and worker to stand in solidarity to the struggle of the workers of VIOMIHANIKI METALLEYTIKI and to actively support the workers both financially and politically.

Wednesday 11/7/2012,
6pm at the Labour Centre of Thessaloniki.

Movement for Workers’ Emancipation and Self-Organisation


Eurozone meltdown: IMF providing “political cover”

See original at the Bretton Woods Project

As European elections show the public increasingly rejecting austerity, critics call on the IMF to focus on the flaws of the eurozone rather than austerity in country programmes.

Throughout the past months the prolonged recession in parts of Europe saw unemployment reach record highs and output stall, with concerns that austerity is hindering growth and the prospects to achieve fiscal and debt targets (see Update 80, 79). A March report from the Macroeconomic Policy Institute in Germany expects economic activity to decline this year by 1.3 per cent in Ireland, 4.3 per cent in Portugal and 6.7 per cent in Greece, with unemployment reaching 14.1 per cent in Portugal and Ireland, and 20.1 per cent in Greece. The report concludes that because of “simultaneous austerity policies … the main cause of the euro crisis will thus not be overcome but aggravated”.

In this context the austerity policies demanded by the troika (European Union, European Central Bank and IMF) have been rejected by a growing share of voters in the Greek and French elections, criticised by government leaders throughout the world, including US president Barak Obama and Brazilian president Dilma Rousseff, and even seen increasing opposition from participants in capital markets, who have started to call for a new strategy to deal with the crisis. In early May Charles Dallara, the head of the Institute for International Finance, a global association of private financial institutions, explained that “the focus has been too heavily placed in short-term budget cuts and this has created the feeling that the situation seems bottomless.”

Beware of IMF’s ‘sympathy’

Despite criticisms and poor outcomes, the IMF chief economist Olivier Blanchard argued in the latest IMF World Economic Outlook (WEO), published in April, that “the right strategy remains the same as before”, meaning that spending cuts should neither be too fast, which would hurt growth, nor too slow, which could hurt credibility (see Update 78, 77). Christine Lagarde, the IMF managing director, also reaffirmed the existing strategy of the Fund by praising the internal devaluation in Latvia. Lagarde argued “it’s important for other crisis-ridden countries to learn from Latvia. The programme there was a success.”

Mark Weisbrot, of the Center for Economic and Policy Research (CEPR), criticised Lagarde’s “perverse praise” of “Latvia’s disastrous internal devaluation”, arguing that the country “sacrific[ed] nearly a quarter of its national income at the altar of austerity” with “unemployment rising from 5.3 per cent to over 20 per cent” and another 10 per cent of the labour force leaving the country. Similarly, in a June article, Nobel prize winner Paul Krugman opposed the idea that an internal devaluation can replace the need of exchange rate adjustment, and argued that “while Latvia’s willingness to endure extreme austerity is politically impressive, its economic data don’t support any of the claims being made about its economic lessons.”

Lagarde also faced fierce criticism in May after making controversial comments on the need of the Greek population to “pay back” for their country’s mistakes, and that she felt more sympathy for “little kids from a school in a little village in Niger” than for the people of Greece. Nick Dearden from UK NGO Jubilee Debt Campaign responded that “if ‘sympathy’ is what characterises the IMF’s approach to Niger, then Greece would do better to avoid it.” He described how “in Niger, the IMF’s loans have done more harm than good as ordinary people have had to pay the price for reckless lending”, and argued that “to pretend that the IMF operated in a somehow kinder way towards Niger than it is doing in Greece stands up to no scrutiny whatever.” Meanwhile, Greek economist Alex Andreou criticised Lagarde’s idea of “Greece as one homogenous, tax-dodging mass responsible for its own downfall”. He argued that Lagarde’s “stance shows a complete misunderstanding of the psychology of a nation which has suffered nearly five years of recession and the severest of austerity cuts; a nation which is increasingly and vocally rejecting foreign interference and which is being pushed to political extremes.”

After two years of interventions in Europe, however, the Fund seems to be slowly acknowledging that growth and stability will not be achieved if flaws in the design of the euro are not addressed. The latest IMF WEO emphasised the euro “design flaws” more than previous editions, pointing to the “urgent need” for common banking supervision and risk sharing. It details that “measures should be taken to decrease the links between sovereigns and banks, from the creation of euro level deposit insurance and bank resolution to the introduction of limited forms of eurobonds, such as the creation of a common euro bill market.”

Also, a mid-June IMF staff discussion note, Fostering growth in Europe now, points at the need to tackle uneven demand between northern and southern European countries with action on both sides: “Relatively speaking, the south needs nominal wage restraint, and the north to let wages rise in line with productivity and market developments”. However, it proposes labour market deregulation policies in order to restart growth (see Update 81).

IMF’s repeated failures

Austerity and structural reforms, including privatisations of public services (see box), are expected to continue throughout Europe, and especially in Greece. It is possible, however, that a softening in the conditions attached to country programmes in Portugal and Ireland will take place.

The troika will return to Greece to renegotiate with the new government in early July, but the relaxation of the loan conditions requested by the country might be blocked by Germany and bring increasing tensions in the troika. Robert Zoellick, then president of the World Bank, warned at the June G20 summit of growing divisions between the Europeans in charge of the loans and the IMF, and predicted that, in the absence of decisive action, this division could turn into a confrontation by the end of the summer.

University of Athens professor Yanis Varoufakis predicted in late June that even looser bailout terms will prolong recession in Greece and warned that “when in December, it becomes, yet again, clear that another, more relaxed, Greek bailout has failed, that realisation will add to the strains and tensions in Europe, accelerating further the centrifugal forces tearing the eurozone apart.”

Charles Goodhart of the London School of Economics pointed out in May that “the presence of the IMF as part of the bailout programmes has given European leaders political cover for continuing to peddle ill-conceived, failing policies, delaying much-needed more sensible solutions to the crisis.” He explained that “given its historical mandate on exchange rates, the eurozone is the natural counterpart for the IMF, not euro-area member states” and argued that conditionality must apply “also to EU institutions such as the ECB [European Central Bank]” and to “northern countries like France and Germany”. He concludes that “the current asymmetric and incomplete adjustment plan for the eurozone, which focuses solely on the peripheral economies, is self-destructive.”

Meanwhile, Andy Storey, from University College Dublin and member of NGO Action from Ireland, argued that “the failure of the intervention of the IMF in Europe can be explained precisely because of the Fund’s lack of autonomy from capital markets and the mainstream European elite managing the crisis”. He said that “because of this lack of autonomy, since 2010, instead of focusing on the real problems of the eurozone, the Fund promoted unjust and counter-productive fiscal adjustment policies that are contributing to the meltdown of the monetary union. This proves once more that this institution needs radical reform.The question remains, however, who (if any) in the Fund will be held accountable for its appalling failures to date.” Storey added that the IMF’s sitting out of the late June European loan to Spain to recapitalise its banking system shows that “the Fund has lost faith in country programmes in the eurozone. It is unacceptable that the IMF continues to pour tax payer money into programmes that even it now sees as unsustainable. What is needed is a write down of public debt before it is too late.”

Privatisations threaten rights to water

A March report commissioned by the Canada-based civil society network Blue Planet Project and written by five European civil society organisations, examines the impacts of austerity measures on the human right to water in Greece, Italy, Spain, Portugal and Bulgaria. The troika programme for Greece includes the privatisation of the public stake in the water companies of Athens and Thessaloniki, while in Portugal the program includes the privatisation of the public water company Águas de Portugal. It concludes that “IMF/ECB/EU policies … are resulting in the general impoverishment of the population, with the imposing of brutal increases in water charges and taxes.” In mid May, 30 European civil society organisations, including the ones behind the report, wrote a letter to the European Commission arguing that “privatisation … directly threatens the right to water” and demanding that the commission “refrain from any further pressure to impose water privatisation conditionalities” arguing that such “pressure is flawed, undemocratic, [and] at odds with the EU treaties”.

Sonia Mitralias, founding member of the Initiative of Greek Women against the Debt and the Austerity Measures, explained in a March interview how “the destruction and the privatisation of public services imposed by the troika” are affecting women in particular: “millions of Greek women [are] taking on responsibility themselves for the social tasks for which the state was previously responsible” with consequent effects “in terms of physical and mental fatigue, of nervous tension and premature ageing.”

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Public debt, in billions of euros, fourth quarter 2011

The 17-nation euro zone is a collection of countries with vastly different economic profiles. Far from stimulating “convergence” toward a single economy, the eurozone has perpetuated divergence.  Despite the predominance in the mainstream that Greece, Ireland and Portugal should be punished for deviating from the Maastricht rules these graphics show that the majority of countries are well beyond the 3% deficit and 60% debt threshold ratios.


Budget Balance in 2011

The 17-nation euro zone is a collection of countries with vastly different economic profiles. Far from stimulating “convergence” toward a single economy, the eurozone has perpetuated divergence.  Despite the predominance in the mainstream that Greece, Ireland and Portugal should be punished for deviating from the Maastricht rules these graphics show that the majority of countries are well beyond the 3% deficit and 60% debt threshold ratios.