EU leaders prepare to punish Greece

Syriza leader Alexis Tsipras’s first act in government was canceling privatisations in electricity and the ports of Pireaus and Thessaloniki.

He announced that cleaners who have been picketing government offices for a year will be among 20,000 public servants to be rehired. Pensions will be restored and the minimum wage set back at its previous level.

University reforms that were the target of large student protests last year have been cancelled, and the government will grant Greek citizenship to the children of migrants.

This means tearing up the conditions attached to Greece’s bailout program. Greek ministers were locked in talks with the European Union seeking a re-negotiation on the country’s crippling €270bn debt burden as Solidarity went to press.

But the EU and the international bankers have moved swiftly to punish the new government. Greek banks lost almost half their value on the stockmarket. The European Central Bank announced that it would no longer accept Greek government bonds in exchange for loans to the Greek banks—meaning they could run out of money.

Greece’s current bailout deal expires on 28 February. Syriza has appealed for a bridging deal until comprehensive negotiations on the debt can be finalized. German and EU leaders have demanded Greece accept the continuation of austerity measures attached to the current deal. Greece has rejected this, but Finance Minister Varoufakis has said, “We are going to meet half way during the next couple of days”, implying some austerity measures are acceptable.

Syriza says it won’t take unilateral action and does not want to be pushed out of the EU. This means some of its promises are on hold. The increase in the minimum wage will not take effect straight away, but has been promised by the end of the year. New university laws will not come into effect until the start of the next academic year.

Panos Garganas, of the Greek Socialist Workers Party, explained, “The new government is trying to balance between two opposite pressures.

“One is very visible—it comes from the markets, the right wing, and the political blackmail of the EU. But the other is just as important—the expectations of people who voted for the left and want it to end austerity.”


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