Syriza Agrees to Full List of EU Austerity Demands
Greece’s Syriza government and European Commission officials announced a new draft austerity agreement Tuesday morning following negotiations lasting 23 hours.
Details of the agreement are still emerging, but it is clear that Syriza has accepted all of the main demands of the “troika” (European Union, European Central Bank and International Monetary Fund). A Syriza finance ministry official told Reuters, “An agreement has been reached. Some minor details are being discussed right now.”
Under the terms of the agreement, up to €86 billion will be loaned to Greece over the next three years, conditional on the imposition of a raft of new and savage austerity measures against the working class. The new cuts and privatizations will have catastrophic consequences for Greece’s already impoverished population.
According to the Greek daily Kathemerini, the agreement requires the Greek parliament to approve the immediate implementation of 35 “prior actions” before any money is disbursed. The passage of such legislation will trigger an initial €10 billion loan to Greece. All of this money will be used to begin the recapitalization of Greece’s banks, which have been cut off by the troika from external funding since Syriza came to power in January.
Last month, Greek Prime Minister and Syriza leader Alexis Tsipras repudiated the overwhelming anti-austerity vote in the July 5 referendum his government had called and accepted a package of social cuts, regressive taxes and public asset sell-offs that goes far beyond the austerity measures imposed by previous governments, while transforming Greece into a de facto economic colony of the German and European banks. This abject capitulation was endorsed by the Greek parliament, which voted to implement two sets of “prior actions.”
The additional “prior actions” now demanded, described by the Financial Times as “deeply unpopular measures,” include a review of the social welfare system, the phasing out of early retirement for workers in their 50s, the scrapping by the end of 2016 of lower sales tax rates for Greece’s islands, a hike in taxes for farmers, the implementation of product market reforms proposed by the Organization for Economic Cooperation and Development (OECD), the deregulation of the energy market, and the implementation of the privatization programme Syriza has already signed on to.
By the autumn, the parliament must pass new collective bargaining, industrial action and collective dismissal legislation that favors big business.
The new bailout agreement conforms entirely to the terms demanded by Europe’s banks.
A privatization fund is to be set up in Athens, into which moneys obtained from the sell-off of state assets will be transferred. This is slated to raise €50 billion, three-quarters of which will go towards recapitalising the banks and paying off part of the nation’s €300 billion foreign debt.
Central to the deal is the calculation that it will enable Greece to pay off a €3.2 billion loan to the European Central Bank due on August 20.
Prime Minister Tsipras moved to obtain swift passage of the bailout deal, requesting the parliamentary speaker to prepare an emergency session for Thursday. He wrote in a letter: “The crucial nature of the situation requires the immediate convening of parliament to proceed with the deal’s approval and allow the disbursement of the first installment.”
The agreement is scheduled to be discussed at a summit of euro zone finance ministers on Friday.
http://www.wsws.org/en/articles/2015/08/12/gree-a12.html