Memorandum 3

18/01/2016
Before the general strike on February 4th, the train unions have called 'rolling 3-hour stoppages', which will disrupt transport on the national railway system. It should also be noted that Proastiakos, the National Railway Network, controls the line from the last metro station to the airport. The question is: did the unions ballot the members on the decision to take this action? It is highly unlikely that they did and this is a key reform that's needed in Greece, especially if external investment is to be attracted into the Country. The other aspect is the disruption to people travelling to work in the private sector, where many small businesses and companies are struggling. Of course, the Greek transport unions are never interested in their customers, only their own sectional interests. They should remember that if more and more jobs are lost, they will have less customers and may face staff reductions themselves.

http://www.ekathimerini.com/205180/article/ekathimerini/news/delays-cancellations-in-train-services-due-to-work-stoppages


16/01/2015
Another working-day general strike to protest against pension reform has been called for Thursday, February 4th. The objective is obviously to force the government not to implement these measures. One wonders does anyone read the Memoranda and documents agreed with the EU or is it only the negotiators that are aware what is contained in these agreements. It will be recalled that one of the ministers in the Papandreou government admitted he hadn't got time to read the first memorandum agreed by the cabinet, of which he was a member. The pension reforms and creation of a single, unified social welfare fund are in Memorandum 3, agreed by a large majority in Parliament last Summer. Currently, all the opposition parties now oppose the changes proposed by the government, having already agreed to them in the Parliamentary vote. The unions have had about 42 general strikes since the crisis began and have succeeded in changing nothing. In fact, the situation has deteriorated in the intervening years and many argue that Greece's economic problems have been exacerbated by union opposition to change and government reluctance to implement the various memoranda.

It should be acknowledged that many of the measures various Greek governments have been forced to implement are counter-productive to achieving growth and economic recovery. However, there are internal changes that could be made to improve the business environment, make public services more efficient and introduce more competition. These would undoubtedly involve a large dose of pain but the existing environment is certainly not conducive to economic recovery.   Moreover, if the social welfare and pension funds are unsustainable, and almost everyone agrees that they are, then something has to be done to prevent them from collapsing altogether. Finally, it would seem that when anything unpalatable is proposed in Greece, everyone outside the government is against it for one reason or another. Nevertheless, alternative proposals are never presented, leading to the conclusion that everyone wants to be in opposition and nobody has the courage to lead.

http://www.ekathimerini.com/205113/article/ekathimerini/news/unions-gear-up-for-general-strike-on-february-4


13/01/2016
It was noted in this blog (29/11/2015 below) that it would be better for the main opposition parties to support the government in implementing the Memorandum, particularly in relation to pension reform. The article below comes to the same conclusion. The only alternative for opposition parties who do not support the government's bill on pension reform is on the basis of leaving the Eurozone. Any party or  parties that vote against the measures should do so in the knowledge that if a general election results and they are elected to government, they will have to implement the same measures or leave the Euro. That's the reality of the current political situation in Greece. It is also worth remembering that the three main opposition parties voted for the Memorandum, which contains all or most of the proposed pension reforms, so it is illogical to oppose these measures at this stage.

http://www.ekathimerini.com/205012/opinion/ekathimerini/comment/the-decisive-and-the-furious


07/01/2016
Yanis Varoufakis is reported to be launching a pan-European movement to bring back democracy to Europe. In the illustrated article below he makes the point that "financialised capitalism" tries to squeeze out any opposition to the current global market doctrine. For example, wages and working conditions are constantly under threat and governments are under continuous pressure to keep wages low. Thus, the asymmetric relationship between capital and labour that has always existed is tilting more in favour of capital, with increasing bargaining power given to capital. The logic is that if this phenomenon continues, the system will collapse because there will not be enough consumers (with enough money) to keep the system going. Unless the wealth is shared, there is no way the current imbalance can last.

https://www.jacobinmag.com/2016/01/yanis-varoufakis-interview-jeremy-corbyn-greece-eurozone-tsipras/


02/12/2015
There is another general strike (protest) against austerity tomorrow, Thursday December 3rd. It is probable that most of the participants will be public servants and people working in the public sector.
There are seldom any reports about the percentage of people who take part in these strikes, although if there is a demonstration in the centre, the estimated number of participants is usually given. Once again, the general public will suffer more inconvenience. One effect of the strike is that the Metro from the airport to and from the first suburban metro station, Doukissis Plakentias, will not be working. And politicians expect investors to risk their money in this type of business uncertainty? As usual, this strike will achieve nothing, apart from messing up many people's lives for a day - a waste of another day by the unions!!!

http://www.ekathimerini.com/203966/article/ekathimerini/news/strike-to-halt-transport-services-in-greece-on-thursday


01/12/2015
The article below discusses the feasibility of left-wing policies in the Eurozone. The conclusion is that, in the context of the single market, monetary union and (Greece) being restricted by the terms of the bailout programme, this is not possible. The writer suggests solutions to address the difficulties facing Greece and these solutions could also be applied at a European level.

The reality is that governments should be pro-business and create the conditions to allow business to flourish. This would lead to economic growth and higher employment. Many assumed that SYRIZA would have such a plan but sadly, this was not the case. The policies outlined in the article would definitely work but a national consensus between the political parties, employers and trade unions would be necessary to achieve it. It would be similar to creating an Incomes Policy, where wages are kept in line with inflation and employer costs are reduced to encourage employment. If correctly applied, this could lead eventually to full employment. This must be accompanied by a policy to encourage investment to increase growth and create jobs. Obviously, Labour Market Reform would be required because business needs a certain level of certainty. This would mean, for example, legislation related to the conditions under which a strike could take place in order to prevent  trade union leaders for calling a strike with no or very short notice. General strikes in protest about issues should also be banned. If employees feel strongly enough about an issue, they should be committed enough to protest at the weekend.

This article gives a blueprint for a social-democratic left in Europe and it makes a lot of very good arguments in favour of this approach. The solution to achieving European-wide social-democratic governance is for ordinary citizens to elect political parties with the type of policies suggested in the article.

http://tinyurl.com/jnmmtqo


29/11/2015
The main opposition parties, ND, PASOK and To Potami have rejected an offer from Alexis Tsipras to take part in a cross-party committee to agree proposals on pension reform. However, the context needs to be explained in relation to any proposals the Greek Government might make. In Memorandum 3, from pages 13 - 15, there is a section 2.5 Sustainable social welfare and a sub-section 2.5.1 Pensions. The measures related to pensions are outlined here, with the (usual) caveats about any alternative measures (proposed by the government) being exchequer-neutral. Memorandum 3 was agreed in Parliament some months ago by all the parties at yesterday's talks. The reforms  reported in the media are all in the Memorandum document and there is only very limited 'wriggle room' for the government in relation to alternative proposals. This leads to the question as to why the opposition parties have refused to support the reforms?  They have voted in favour of the Memorandum containing these reforms and are being offered the opportunity to have an input into any changes that might be of some benefit to the Greek people.

It could be argued that  for political reasons these parties do not want to be associated with pension reform because it will lose them votes. Nevertheless, if the reforms presented by the government in parliament are voted down, it could lead to another general election. It is almost certain the Greeks do not want another general election so the opposition will be blamed for precipitating one. It would be better to support the government, as happened with the Memorandum vote itself, than bring down the government for the sake of it. Moreover, if the logic of the past 6 years and three Memoranda is followed, then, whichever party or parties form the next government, they too will be presented with the same dilemma and set of proposals. Memorandum 3 calls for the full implementation of some of the proposals agreed in 2010 !

Therefore, taking all of the above into account, it would be foolish not to support the government.  If the opposition parties fail to support the government, causing a general election,  the only logical stance they can take is to fight it on the basis of exiting the Eurozone, in light of their failure to support a document they voted for in parliament.  However, if all the reforms were implemented, then in 4 years time who knows? People have short memories, especially about who voted for what, where and when. Also if all the main political parties all had a hand in passing the legislation, then they are all in the same boat in the eyes of the electorate. The last thing Greece needs is another general election and another process similar to what happened between January and July this year. Failure to implement previous Memoranda and the absence of viable alternative proposals from successive Greek governments, has led to a 25% decline in Greece's economy. The ongoing uncertainty led to increased withdrawals from Greek banks, culminating in capital controls during the Summer (still in place), which is further hampering economic growth. The political machinations in Greece however, are such that the appalling vista of another general election in the very near future cannot be ruled out.

Link to Memorandum 3.
http://ec.europa.eu/economy_finance/assistance_eu_ms/greek_loan_facility/pdf/01_mou_20150811_en.pdf



26/11/2015
Pensioners protested today in the Centre of Athens against the measures set out in the Memorandum related to pension reform. The unions have also called (another) national strike on December 3rd in protest against pension reform and the merger of several pension funds into one fund. These same unions called a national strike on November 12th but it, like all the others,  achieved nothing. The legislation they were protesting against, related to the agreed 'prior actions', was passed in Parliament, albeit with the government losing 2 MPs.  Einstein is quoted as saying: "Insanity is doing the same thing over and over again and expecting different results". After more than 40 general strikes over the past 5 years with nothing achieved but disruption for ordinary citizens, the unions need to examine their policy at this stage. Their actions up to now match the criterion in Einstein's quote.

http://www.ekathimerini.com/203805/article/ekathimerini/news/greek-pensioners-rally-against-cuts-workers-to-strike-next-week


23/11/2015
The trend in employment which has been emerging in Greece since the financial crisis began is not very encouraging. It mirrors the situation in many European countries, where full-time jobs are disappearing and being replaced by temporary and part-time work. More and more people are facing uncertainty at work and this a big challenge, especially for trade unions. If employers can just hire and fire employees and keep workers on rolling contract or temporary contracts, the division between rich and poor will widen. It is already an alarming situation in Western society that wealth is becoming more concentrated in the hands of a few, resulting in an increasing number of people struggling to survive financially. The logic here is that there will be less and less people able to afford consumer goods, which will eventually hit big business. After all in order for businesses to make money, people have to buy their products, so concentrating so much wealth in the hands of an elite few, will, in the long-run, be counterproductive.

http://www.ekathimerini.com/203718/article/ekathimerini/business/more-jobs-in-commerce-but-most-new-positions-are-part-time


23/11/2015
Memorandum 3, agreed in July by the government, is now in the process of being legislated for and implemented. There will be huge opposition to the reforms and changes in the Memorandum. Already, the government has lost two MPs one from SYRIZA and one from Independent Greeks as a result of their failure to support the omnibus bill in parliament on Thursday. The contentious issue was allowing banks to foreclose on primary residences, where people were not paying their mortgages. The government promised they would not allow this to happen but they had to concede some ground and allow a certain amount of foreclosures. This was done by reducing the value of homes entitled to foreclosure protection, originally €300,000, to between €180,000 - €200,000.

The next phase, which includes higher tax for farmers will be very challenging for the government, especially as its majority has been reduced. The main opposition parties have all indicated they will not support the government, despite voting for the Memorandum in parliament.


23/11/2015
The fact that prices in Greece have seen minimal reduction has been highlighted here on many occasions over the past three years. In fact, prices for most products and services have increased. This is against a backdrop of a 25% fall in GDP and major reductions in disposable income because of wage and pension cuts. Once again, this is the subject of an article in eKathimerini, which indicates that Greece is one of the most expensive countries in Europe for many products and services. If a functioning market economy were in place, then one would expect prices to have fallen in the light of whats happening with disposable income but in most cases that's not happening.

http://www.ekathimerini.com/203677/article/ekathimerini/business/disposable-income-shrinks-twice-as-fast-as-gdp