/ 29 January 2015

Athens tears up austerity handbook

Athens Tears Up Austerity Handbook

In a dramatic start to his tenure in office Greece’s new prime minister, Alexis Tsipras, leader of the Syriza party, has begun to unpick the austerity policies underpinning the debt-stricken country’s bailout programme.

Storming to power last Sunday, the leftwinger said there was no time to waste. He told his first Cabinet meeting on Wednesday: “We haven’t the right to disappoint our voters.”

The government’s top priority would be to tackle the “humanitarian crisis” – the result of five years of punitive belt-tightening measures – but also open negotiations over Greece’s unsustainable debt, at €320-billion, the largest in Europe.

“We won’t get into a mutually destructive clash, but we will not continue a policy of subjection,” said Tsipras who, at 40, is Greece’s youngest post-war leader.

Catapulted into office for the first time, Syriza – in power with the small, right-wing Independent Greeks party after falling two seats short of an overall majority in the 300-seat house – set about acting on its pledges before the Cabinet meeting even began.

Earlier, Energy Minister Panagiotis Lafazanis halted the privatisation programme that the European Union and the International Monetary Fund (IMF) have demanded in exchange for the €240-billion in aid keeping Greece afloat.

Privatisation plans frozen
Plans to sell off the country’s dominant Public Power Corporation (PPC) were to be frozen with immediate effect. “We will immediately stop any privatisation of PPC,” said the politician, who heads Syriza’s militant Left Platform. Plans to privatise the port of Piraeus, the country’s largest docks, were also put on hold.

China’s giant consortium Cosco and four other suitors had been vying for a 67% stake in the port authority, agreed in consultation with creditors by Greece’s previous conservative-led coalition government. “The Cosco deal will be reviewed to the benefit of the Greek people,” said Thodoris Dritsas, the deputy minister in charge of shipping.

Shares in PCC and Piraeus Port tumbled by around 7% at the start of trading in Athens, while Greek government bond yields rose to near record levels and bank shares fell. Dismantling the EU-IMF mandated measures that had plunged Greece into poverty and despair would, declared Panos Skourletis, the labour minister, be his single greatest priority. “Reinstatement of minimum wage to €751 [a month] will be among the government’s first Bills,” Skourletis announced on Antenna TV.

Under international stewardship, Athens had been forced to pare back the minimum wage to under €500, ostensibly to increase competitiveness and make the labour market more attractive. Skourletis, formerly Syriza’s hard-nosed spokesperson, said plans were similarly under way to bring back collective work agreements – a major demand of unions – and to annul the enforced mobilisation of workers protesting against cuts. Under the former prime minister, Antonis Samaras, whose fragile coalition had held office for almost three years until it was ousted on Sunday, striking employees had been regularly mobilised. The orders had been seen as one of the worst infringements of workers’ rights.

In another departure, bound to put it at odds with Brussels, the government challenged fresh EU moves to step up sanctions on Russia over its actions in Ukraine. The new foreign minister, Nikos Kotzias, a political science professor and left-wing patriot, said further measures would not be in Athens’ interests.

Corruption chased without mercy Greece, Tsipras insisted, had finally ushered in a new era that would seek to clamp down on the inequities of life as Greeks had known them in the 40 years since the restoration of democracy after the collapse of military rule. The corruption and vested interests that had oiled the wheels of the country’s financial and political elites would be chased without mercy, he said.

“We have come to radically change the way in which the country is administered,” he said, warning government ministers against the perils of becoming arrogant in power. “We come with certain rules and regulations to put an end to the regime of entanglement [corruption] and to make the clientelist state a thing of the past. The power that has been granted to us doesn’t belong to us. It belongs to those who gave it to us to handle.”

But with Athens seemingly bent on a collision course with foreign lenders, the warnings also came in thick and fast. “The message ‘we want your support but not your conditions’ won’t fly,” snapped Dutch Finance Minister Jeroen Dijsselbloem who, as head of the Eurogroup, is due to visit Athens for talks with the vehemently anti-austerity economics minister, Yanis Varoufakis. “My message will be that we’re open to co-operation, but that the support from Europe also means the Greeks have to make an effort.” – © Guardian News & Media 2015