The mess in Greece

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Inside Story: Greece protests at austerity measures

Inside Story with presenter Teymoor Nabili discusses with guests: Vagelis Agapitos, independent economist; Yanis Varoufakis, professor of economics at the University of Athens; and Fotis Boblas, an activist and protester.

The Economy of Greece (Wikipedia)

Analysis: In Greece, it's all about 'solidarity'

Solidarity is probably a word that you would not associate with Greece following the events of the past few days.

Love and understanding were in short supply on the streets around Parliament, where protesters and police clashed this week, as well as within the walls of the prominent sand-colored building, where Greece's politicians failed to strike a deal to form a government of national unity to oversee the latest austerity measures the country has to adopt to qualify for more loans from the European Union and the International Monetary Fund.
However, solidarity is a very relevant word in terms of Greece's plight 13 months after the EU and the IMF agreed to bail it out with 110 billion euros ($157 billion) in loans. Firstly, it's a word that's on people's minds because the government said it is introducing a "solidarity tax" that will lead to crisis-fatigued Greeks having between 1 percent and 4 percent of their incomes kept aside to help pay benefits for the rapidly growing number of unemployed.


Maybe this does not seem such a big sacrifice to make to help those left without jobs as a result of the crisis. The problem, though, is that the "solidarity tax" is the latest in a series of new taxes or hikes that have been imposed since last year as the Greek government scrambles to gather more revenues to tackle its towering deficit and debt.

The preferred method for raising more revenues was to increase value added tax (VAT). The top rate of VAT has increased twice since last year, rising from 19 percent to 23 percent. Duties on fuel, alcohol and tobacco have also increased substantially. So, a liter of gas in Greece now costs roughly 1.70 euros ($2.43), meaning it has gone from one of the cheapest countries in Europe to fill up your tank to one of the most expensive. Greece is now in the top three countries in the EU when it comes to VAT levels, fuel duty and social security contributions.MORE

Millions strike in Greece over austerity plans

Greece, the sickest patient in the ailing eurozone, was rocked yesterday by a nationwide strike of millions of workers and hours of rioting in street protests against the government's austerity plans.

The day ended with an announcement by its embattled Prime Minister, George Papandreou, that he would reshuffle his Cabinet in an attempt to push through measures to alleviate the country's crippling debt crisis.

Earlier, he had offered to step down and form a unity government with opposition parties, a gesture he abandoned after the conservative New Democracy demanded Athens renegotiate its year-old, €110bn international bailout.MORE

June 13 The crisis in Greece intensifies

The only way to describe recent developments is Greece is to refer to a peaceful popular insurrection. The mass gatherings at city squares at the centres of all major Greek cities continue to gather momentum. On Sunday 5 June, Athens and most Greek cities experienced some of the biggest mass rallies in recent history. Hundreds of thousands of protesters in Constitution square in Athens, tens of thousands in Thessaloniki and many more thousands in most Greek cities. It is a unique experience of social mobilization and an original form of popular protest that combines the mass rally with a democratic process of discussion through mass popular assemblies.

What is more important is that these mass rallies and assemblies act as a point of convergence not only for people who have taken part in mass rallies, strikes, and social movements in the past months, in the big wave of social protest that followed the austerity program, but also for people that up to now refrained from mass action.

This movement is based on the collective experiences of struggle in the past year, such as the December 2008 youth explosion, the massive general strikes in the Spring of 2010, the big strikes in public transport in the Winter 2010-2011, the heroic struggle of the people of Keratea, a small town in the greater Attica region that for months fought with riot police, successfully opposing plans for an environmentally disastrous landfill in their vicinity. At same time people with no prior experience of struggle come forward in these protests, which are not simple imitations of the 15-M protests in Spain, but a much more widespread form of protest with deeper roots in Greek society.MORE

June 16 Greece reaches the brink: Eric Ruder explains the issues underlying the massive protests shaking Greece.

Last year, the EU and IMF insisted that Greece force through a draconian austerity package in exchange for a $146 billion bailout. That bailout was supposed to "fix" Greece's debt problem and, after some hardship, put it back on a path of sustainable growth. But while the austerity measures imposed incredible hardship on Greek workers, the bailout hasn't restarted the economy. On the contrary, gross domestic product dropped by 4.8 percent in the last year, industrial production is down 8 percent, and consumer prices are up 4.8 percent.

According to official statistics issued by the Greek government, "The unemployment rate [in the first quarter of 2011] was 15.9 percent compared with 14.2 percent in the previous quarter, and 11.7 percent in the corresponding quarter of 2010." And the unemployment rate for those under 30 is 31 percent.

It shouldn't be surprising that raising taxes on working people and cutting wages had the effect of stifling Greece's already weak economy. But now, with the crisis getting deeper, Europe's financial elite is demanding even more from working people.MORE