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Bankers’ coup puts anti-worker ‘technocrats’ in charge

Published Nov 17, 2011 9:35 PM

Thousands booed rightist billionaire and media magnate Silvio Berlusconi following his resignation as Italy’s prime minister on Nov. 11. A week earlier, Prime Minister George Papandreou, whose popular support plummeted after he agreed to austerity measures, was forced to resign from the leadership of Greece, ending a political dynasty that had lasted for three generations.

These powerful politicians were pushed out of office not by popular upheaval, however, but by order of the imperialist banks that dominate Europe and the United States. They had shown they were incapable of executing austerity measures that the bankers needed in order to make the working class pay all the costs of the financial crisis.

The so-called technocrats named to form new governments in both countries will be even more under the thumb of finance capital than billionaire Berlusconi and the compliant Papandreou. The technocrats’ task is to impose austerity measures that will cut workers’ social benefits and wages as they allow the payment of usurious interest rates to these same banks.

Power of finance capital

In the Nov. 3 Workers World, Deirdre Griswold wrote that researchers in Zurich, Switzerland, had done an analysis using a powerful computer database with information on millions of global financial transactions. The analysis showed that “a mere 147 companies controlled nearly 40 percent of the monetary value of all transnational corporations,” thus placing the world capitalist economy in the hands of fewer financiers than ever.

This concentration brings with it political power. Look at who the replacement prime ministers are.

In Greece, it’s Lukos Papademos. Educated in the U.S., he was a governor of the Bank of Greece from 1994 to 2002 and vice president of the European Central Bank from 2002 to 2010.

In Italy, it’s Mario Monti, an economist and former member of the European Commission. Like most “technocrats” brought in during these kinds of crises, he has a reputation of being “honest.” That means he has not been caught stealing from his banker bosses.

Papademos and Monti are both members of the Trilateral Commission, which U.S. banker David Rockefeller founded in 1973 for discussions among leaders of the imperialist U.S., Western Europe and Japan, and the Bilderberg Group, which organizes an annual conference of about 140 business and political leaders of North America and Western Europe.

Their membership in these elite and exclusive groups shows that both are acceptable to banking circles in both Europe and the U.S. Neither has a popular political following in the countries they will lead — more proof that the imperialist ruling class has little use for even formal democracy when it comes to the really big questions, like paying interest to the banks.

With the crisis so severe, the imperialist bankers put their own employees in government office, rather than a slightly less reliable politician. These unelected governments plan to pass austerity plans that — if not resisted — will inflict pain on the working class for at least the next 10 years.

As November began, Papandreou had raised the possibility that Greece would hold a referendum to consult the Greek people on the austerity agreement he had made with the French and German leaders. This provoked an apoplectic response from the Euro heads. They screamed, “No, no, no!” Papandreou withdrew the referendum and was on his way out.

Big Lie obscures cause of crisis

The corporate media, not just in Europe but in the U.S., have promoted a Big Lie to explain the Euro crisis. But the crisis is not the fault of “lazy workers” in the Mediterranean countries (Spain, Portugal, Italy, Greece) nor of high spending on social services in those countries. The capitalists and their pundits promote this lie in an attempt to divide the workers of northern from southern Europe while attacking all social benefits, including health care, pensions and even education.

The world capitalist downturn that began with the bursting of the housing bubble in the U.S. in 2007 and the financial near-collapse in the fall of 2008 caused an economic downturn throughout Europe. It hurt the economies of Greece, Spain, Portugal and Italy more than those of Germany, the Netherlands and Belgium.

The banks started charging higher interest rates for loans to countries with the weaker economies, claiming that the risk of default was greater there. The big banks in France and Germany saw these loans as a source of higher profit, and counted on a bailout if default loomed. The U.S. investment firm Goldman Sachs got in on the deal too, creating investment instruments that hid the extent of Greek debt.

By 2009, Greece had to agree to an austerity plan that the European Union, the European Central Bank and the International Monetary Fund — now called “the Troika” — imposed on it. The result was layoffs, as cuts in spending led to closed schools and hospitals, a new recession and an unemployment rate now more than 16 percent. By this fall, default loomed again.

Not only the European banks but also Greece’s own banks and capitalists were responsible. Besides avoiding taxes, in the last few years 2,000 businesses that had been located in Greece moved to Bulgaria, where labor costs were one-quarter that in Greece. Another 800 will leave in 2011. That’s how the capitalist market rules.

No one expects the world economy to suddenly have a major upsurge, certainly not one that reverses unemployment.

Should Italy, whose economy is seven times as large as Greece’s, fail to pay the debt, this would have a much larger impact on the big imperialist banks, on the eurozone and on the European Union’s future. Accordingly, news of Italy is starting to dominate the media, which had been focused on Greece.

Workers’ fightback

Resistance to this new assault on the working class is the order of the day in both countries. In Greece, where the workers’ resistance has been at a higher level than elsewhere in Europe, there have been dozens of general strikes and demonstrations over the past two years.

These forces — which mainly follow the Communist Party of Greece (KKE) and the union federation PAME — have already rallied against the new “national unity” bankers’ regime, made up of Papandreou’s PASOK party, the rightist New Democracy and the small, fascist-like Laos Party.

Of the parties in Parliament, only the KKE and the more reformist left grouping, Syriza, have refused to join the government.

In Italy, the severe austerity is just beginning. The new planned belt-tightening will cause more unemployment as well as a loss of social services. Resistance can be expected.