Dear listeners and friends,
Dear listeners and friends,
Originally published at MintPressNews:
“We had the role of a rubber stamp…” – a former board member of Greece’s national statistical authority has revealed that she and other members were forced to sign off on falsified deficit and debt figures that plunged their country into an ongoing economic depression.
ATHENS (Interview)– On May 18, a new chapter was written in Greece’s economic odyssey, as the Greek parliament, with the votes of the SYRIZA and Independent Greeks coalition government, approved Greece’s fourth memorandum loan package since the onset of the country’s depression. The strings attached to this new deal with the “troika” of Greece’s lenders include 140 new austerity measures, including tax hikes and additional pension cuts.
This comes just weeks after the Greek government triumphantly announced the achievement of a 4.2-percent budget surplus for 2016, exceeding expectations. Greece is in the midst of its eighth full year of economic depression, a crisis that emerged in late 2009 when it was revealed that Greece’s deficit and debt figures were larger than had previously been publicized.
Was this really the case though? Several former board members of the Hellenic Statistical Authority (ELSTAT) have spoken publicly in recent years, revealing evidence that they argue proves that Greece’s debt and deficit figures were indeed falsified in 2009.
But the evidence provided by these whistleblowers shows that the figures were actually falsified in order to appear worse than they were in reality, providing the political impetus to bring Greece under the supervision of the “troika” (consisting of the IMF, European Commission, and European Central Bank) and leading to successive memorandum agreements and the enactment of strict austerity measures.
Further fueling these claims, former IMF chief Dominique Strauss-Kahn has publicly admitted that in April 2009 he met with George Papandreou, who was then campaigning in Greece on a platform of promises of new social services and benefits, claiming on the campaign trail that “we have money” for these programs.
Papandreou, who had not yet been elected, came to power following the Greek elections of Oct. 4, 2009. A few months later, the new government publicly announced that the deficit and debt figures for 2009 were higher than originally claimed by the outgoing government.
One of the whistleblowers involved is University of Macedonia professor of applied econometrics and productivity Zoe Georganta. A former member of the board of ELSTAT and former visiting professor at Harvard University’s National Bureau of Economic Research, Georganta was the first whistleblower to publicly contradict the previous government’s claims.
These accusations have resulted in a succession of judicial cases centered around former president of ELSTAT Andreas Georgiou, who is also a former IMF official. MintPress News recently spoke with Georganta in an interview that was first broadcast on Dialogos Radio in May 2017. In this interview, Georganta discusses the evidence she presented and the status of the legal cases that followed as a result of these accusations, as well as shares her thoughts regarding the economic figures currently being publicized by the Greek government, including the recently announced primary budget surplus.
MintPress News (MPN): Share with us an overview of the information that you revealed against the Hellenic Statistical Authority regarding how the Greek deficit and debt figures for 2009 were falsified and inflated.
Zoe Georganta (ZG): As an econometrician and economic statistician appointed in August 2010 by the Greek Parliament to be a member of the seven-member Hellenic Statistical Authority, I had the responsibility by law to express my scientific opinion – first within the meetings of ELSTAT, in which all seven members, the president (or chairman) included, were supposed to discuss the statistical issues of the agenda and make a decision by majority rule.
What actually happened from the first meeting of ELSTAT on August 3, 2010 was very strange and seemed extremely peculiar to all six of us, since the president, Andreas Georgiou, supposedly an ex-vice president of the Statistics Department of the IMF—this was declared as his position in the IMF—insisted that he had to be the only person who could speak and decide, while the remaining six of us had to agree and sign his proposals without questions.
According to him, we had the role of a rubber stamp. He said that openly to us. He also insisted that we should not keep minutes of the meetings, and when we all threatened to resign and publicize the issue, he agreed to keep minutes but he added that the minutes would report only his opinion and nobody else’s. So as you can imagine, there were minutes [of these meetings] but they were not signed by any of us.
ELSTAT, as a seven-member board, had only four meetings, because the president [maintained] extremely strange attitudes. As the main issue was the measurement of the final estimate of the public, or general government debt and deficit for 2009, Mr. Georgiou kept presenting to us ad hoc numbers and he refused to answer our questions about how he came to those numbers.
Consequently, all six of us then insisted that the director of the national accounts division of ELSTAT, Nick Stroblos, come to our meeting and explain to us those numbers. Mr. Stroblos’ comments were a catapult. He said that those numbers were wrong and they were fixed by violating Eurostat regulations and methodology, which are described in the ESA manual. ESA [refers to the] European System of Accounts, and this is legally constituted under European Commission regulation 2223/1996.
By investigating the issue, we found out that Mr. Stroblos was right. I must report here the fact that Mr. Stroblos was sacked from his position the very next day after he expressed his reservations about the 2009 debt and deficit numbers that were fixed by Mr. Georgiou and by the general director of Eurostat, as we found out later.
After he sacked Mr. Stroblos, Mr. Georgiou went on to neutralize all six members of the ELSTAT board, with the help of the IMF representative in the troika Poul Thomsen, who, according to evidence, asked ECOFIN, the group of the finance ministers of the EU, to force the Greek government to change the statistical law so that ELSTAT would [fall under] Mr. Georgiou’s rule without a board of directors. This was finally done in 2011 and all six of us were sacked without explanation, just [as a result of] a clause within a law of economic austerity measures.
As you said, I was the first one to report in the press evidence of [falsely] augmenting the debt and deficit of 2009. Not mere allegations, but by indicating the exact violation of the Eurostat regulations and by referring to particular sections of the European methodology which were violated. I did that for the first time in October 2010. Then, I tried to inform the parliament and the government, but as they said to me, they had to obey orders by the IMF and the European Commission, who seemed to be covering for Georgiou.
Apparently, as we found out later, [this was] in order to justify their unnecessary loans to Greece according to the memorandums of understanding that they had signed with the Greek government, and also to justify the second memorandum of understanding, after the augmentation of the deficit figure to 15.6 percent of GDP.
My criticisms were subsequently supported by former Vice President of the ELSTAT board Nikos Logothetis, [plus] another member of the board. The whole issue as it became public, was ex officio investigated by the economic prosecutors, who after one year of [investigating] came to the decision to press charges against Mr. Georgiou for two crimes.
[The first charge] regards breach of duty for three instances: first, by lying to the Greek state that he had resigned from the IMF, while the truth was that he continued being an IMF employee. Second, by not inviting meetings of the board according to law, and third, transmitting falsified debt and deficit data to Eurostat without even discussing it with the board, as he should have done according to law. The second [charge refers to] the felony of forging data on the 2009 public debt and deficit.
The economic prosecutors decided that Mr. Georgiou committed all his criminal actions intentionally for personal benefit and for the benefit of others. Mr. Georgiou is [facing] these accusations today, and on May 29, we have a court case in the second degree regarding his breach of duty. We hope that the truth will show, because these are simple and exact accusations.
He lied to the Greek state in order to gain the post of ELSTAT president, and second, he stopped [convening] board meetings because all six members of the board were “bothering” him, as he stated in his letter to the Greek Parliament, and because he transmitted the augmented [debt and deficit] data that was actually dictated to him, as we found later, in correspondence between him and Eurostat’s general director Walter Radermacher.
He [did this] without even discussing this data with the board, even though he had an obligation, under the law, to have a vote on that data, a majority vote. So he transmitted [this data] illegally. These three instances of his breach of duty will be tried in court on May 29.
(Editor’s note: Zoe Georganta describes the evidence she presented in an earlier interview, recorded in December 2012, that aired on Dialogos Radio).
MPN: Who is Andreas Georgiou, and what was his background prior to becoming the president of the Hellenic Statistical Authority?
ZG: After his strange behavior, I started [investigating his background] and I found out that his post at the IMF was not vice chairman of the statistics department, as he declared and as the former minister of finance declared, but [that] he was a simple employee of the IMF in the financial institutions division. His duty was to supervise the implementation of IMF terms by underdeveloped countries receiving IMF financial assistance.
I also found out he was very rarely in Washington, [spending most of his time] in Africa. I know people, real statisticians at the IMF, and I contacted them as part of my job as an applied econometrician, and I also found out that he is not a statistician and his only publication is a book about martial arts!
He has no scientific publications, only a discussion paper [co-authored] by another three people, and he is not the first name, at first. So far, he has no scientific publication in any field, and in particular in the fields of economics, finance and statistics. Obviously, he was imposed on Greece because the IMF and the European Commission knew, in my opinion, that he could be their man, I mean a puppet of his bosses. This is his character, as far as I understood him from his “collaboration” with us.
By my opinion and not only my own opinion, he was the most unsuitable person for the Greek case. He did not even write in Greek, and he had not been in Greece for 25 years after completing high school at the American Community Schools, not even for holidays.
Now, at the age of 53 or 54, as I read in a recent article in The Wall Street Journal, he escaped from Greece [to his Maryland mansion] when he [faced prosecution]. And now, at an early age, he is an IMF pensioner while everyone in Greece and in Europe [receives their] pension at the age of 67 and not before that.
I want to say at this point that the IMF calculated wrong multipliers for Greece, [but this does not come as a surprise] because the statistics were based on incorrect data. It was not only the debt and deficit data that were wrong, but also the data on expenditures and production that Mr. Georgiou manufactured, together with Eurostat.
The result was unnecessary loans to Greece and the deep recession we [have been] experiencing for seven years now. You know, correct economic policies are based on correct data, and this was not the case for Greece.
Was the selection of this particular man an IMF mistake? All Greeks are wondering about that. Or [maybe] it was a plan to save the French and German banks by loading debt upon debt on the Greek people. It is a real Ponzi scheme, what has been done to Greece, and this is a shame on the part of the IMF, the European Commission and the ECB. After so many loans, the Greek debt has tripled between 2009 and 2016. Is this justice [that is being] shown by our supposed partners, with whom we have fought together in world wars?
MPN: Share with us some additional details about the forthcoming court case against Mr. Georgiou, for which from what I understand you and fellow whistleblower Nick Logothetis from ELSTAT will appear as witnesses.
ZG: After so many unacceptable interventions with letters threatening the Greek government from the European Commission, under the guise of the International Statistical Institute or the administrative personnel of the American Statistical Association, asking the Greek government to intervene in the Greek court system and to stop the court cases against Georgiou, there were three proposals by three individual judicial representatives who asked for Georgiou’s exoneration. All three were turned down by the court committees.
He was not exonerated, as some foreign and Greek newspapers wrote. Those “exonerations” were just proposals by three judicial representatives, but they were turned down by the official court committees.
Now, we have the May 29 court case against him for breach of duty. We are also expecting the actionable date for the felony [charges]. I would like to mention that Georgiou has been sentenced twice to one year of imprisonment for libel against the ex-director of the national accounts division of ELSTAT, Nikos Stroblos, who was [fired] when he simply expressed his scientific opinion and reservations about the numbers, which were coming as if they were falling down from the sky, without any explanation.
It is not only me and Logothetis as witnesses against him. We are three out of the six members of the ELSTAT board who were brave enough to be witnesses. The other three members include two representatives of the ex-minister of finance [Giorgos Papakonstantinou] because he committed other crimes, fraud, against Greece, and the other was a representative of the Bank of Greece [and former governor] George Provopoulos.
Those people were afraid to come out, although within the meetings, we were all together against Georgiou, asking questions about the ad hoc numbers that he was bringing to us. There are also other witnesses, other officials from ELSTAT and other statisticians. Regarding the breach of duty, all six members of the board have come out against [Georgiou] as witnesses, not only in court, but in the Greek parliament.
I would like to say at this point that the European Commission keeps accusing Greece’s judicial system of intervening in [Greece’s handling of] financial data. This is ridiculous and outrageous. It is clear that Georgiou broke the law and he has to be brought to court.
He broke the law, it is very simple, and all the rest is to cover up the IMF’s and Eurostat’s responsibility for Greece’s deep recession, because of the unnecessary laws that they gave to Greece due to the wrong and untruly augmented numbers for Greece.
MPN: Georgiou is no longer the president of the Hellenic Statistical Authority, having been replaced by Athanasios Thanopoulos. However, in your estimation, is the Hellenic Statistical Authority today continuing the same practices as before, through the falsification or alteration of Greece’s economic figures?
ZG: Tell me which statistical authority or statistical office in Europe, or [in the rest of the world], is under one person’s rule, as has been imposed on Greece. Thanopoulos was actually appointed not by the Greek parliament, but by the European Commission, and they forced the Greek parliament to sign off on their decision to appoint Thanopoulos as the head of ELSTAT, without a board [of directors]. So ELSTAT today is under one person’s rule. How unbiased and independent can the numbers be? That’s why there are all these arguments between the IMF and the Europeans—not between the IMF and Greece or the Europeans and Greece—because Greece has no say. Eurostat manufactures the data about the debt, and they claim that the debt is viable. But the debt is not viable.
Thanopoulos, in my opinion, has shown…[that] he has to obey the orders of the Eurostat and the European Commission regarding the numbers, and especially numbers regarding Greece’s debt and deficit. And of course, he has to support the deep depression policies for Greece.
Are these policies [implemented] due to the incompetence of the Europeans and Thanopoulos? No. Our German pseudo-partners have said it openly, that Greek people are undisciplined and must be broken. Because of this, I think that the Eurozone is going to be doomed.
Greece’s economic history has been forged, first by Georgiou, and Thanopoulos continues in the same way because they have changed the data. Since 1995, the data has been changed in a completely ad hoc manner. I have all the old data, and they wanted to show a smooth increase in Greece’s indebtedness, which is wrong. I have evidence because I have worked for 42 years as an applied statistician, as an economic researcher, as a professor at the University of Macedonia, and as a visiting professor at Harvard’s National Bureau of Economic Research.
I have not managed [to publish] yet because of my court cases, but very soon my bombshell book will be out in English. However, Thanopoulos’ behavior, I must admit, is not as absurd or stupid or nonsensical as Georgiou’s behavior was towards everybody, even towards the MPs of the parliament, the prime minister and the ministers. Thanopoulos seems smarter but more secretly cunning, so he can survive better than Georgiou.
MPN: The current SYRIZA and Independent Greeks coalition government is claiming to have achieved a primary budget surplus, initially 3.9 percent and now 4.2 percent, well above the targets Greece’s lenders had initially set for 2016. Does this surplus exist in reality or is it a product of creative accounting?
ZG: This is a very good question. It is for sure creative accounting. It’s not the people, the statisticians of ELSTAT who measure the numbers, according to the European methodology. But Thanopoulos employs a lot of Eurostat experts, some Eurostat pensioners and European Commission pensioners who come to Greece, within ELSTAT to manufacture the data, distant from the statisticians of ELSTAT.
And of course, when there is sunshine, they go to the nearby island of Aegina, where they have good fresh fish and enjoy themselves with their wives. But they do their job and they are paid very generously. Well, in questioning them, Eurostat says that it pays them, but that Greece provides a portion of Eurostat revenues.
Those surpluses are not healthy, if they exist. How can a country whose GDP has shrunk by 28 percent have primary surpluses? If it does, of course those surpluses are not healthy. They do not come from growth, but from squeezing public expenditures for health and education, from stealing the revenues of the research organizations of Greece, changing them into public servants and public corporations so that [the state takes] their revenue that they make out of collaborating with foreign institutions.
Also, those surpluses come, of course, from taxes that are choking any private entrepreneurial initiatives made by Greeks, and of course by giving nothing for growth. The Greek debt has come to a point that it cannot be served anymore, because as I said, the troika, or “institutions,” load Greece with debt in order to pay previous debt. Isn’t it crazy? All of this is creative accounting, unfortunately.
MPN: In 2015, you presented evidence to the Greek Parliamentary Debt Audit Commission, which had been convened at that time. What did the evidence that you presented contain, and what was the outcome of this commission’s proceedings?
ZG: The Greek parliament has actual correspondence between the former European commissioner of economic affairs, the general director of Eurostat, the IMF representative Poul Thomsen, and Georgiou, as well as the former minister of finance of Greece, showing the involvement of the European Commission and Eurostat in untruly augmenting the Greek debt and deficit for 2009.
This correspondence exists because Logothetis pressed charges against Georgiou for wrongly accusing [Logothetis] of “hacking” [Georgiou’s] personal email. I want to say here that all charges against Logothetis have been dropped, although the Wall Street Journal had a recent article by Marcus Walker which completely distorts the facts, showing his outrageous bias in favor of Georgiou. It is a pity, but it has happened. I am saying that to be clear, because Logothetis was not hacking anybody. His [proficiency with] computers is not at that level. How could he break passwords and all this that Georgiou accused him of?
Regarding the parliamentary debt audit commission, its work was interrupted because the prime minister [Alexis Tsipras] sacked Zoe Konstantopoulou as president of the parliament and also as member of the governing party [SYRIZA].
(Editor’s note: Georganta added, in a Greek-language version of this interview, her belief that Konstantopoulou was insincerely adopting a populist pose).
However, although my name is not mentioned in the final report, I gave data to that committee in parliament, but not all of it was publicized. Still, the outcome is that a sizable portion of the Greek debt is illegal and odious. I want to say at this point that the restructuring of the Greek debt that is under discussion now is completely nonsensical because it means a time extension of its repayment schedule, which is unfair for the future generations of Greece. Now, it is in the next 50 years that the Greek debt is to be repaid, but they want to extend it to 80 or 100 years. Actually, [the institutions] have set a number: 99 years.
The Supreme Court of Greece came to the conclusion, in August 2016, that 210 billion euros is the measured damage done to Greece by the false augmentation of the public deficit of 2009. This damage to the Greek state has to be paid back to Greece, because the European Commission and Eurostat are among the partners in Georgiou’s crimes, with evidence which has been kept in parliament and in the Greek justice system.
MPN: Indeed, at the same time that this parliamentary debt audit commission was convening, a number of Greek government ministers of that time, including then-finance minister Yanis Varoufakis and even Prime Minister Alexis Tsipras, were making public statements claiming that Greece’s debt would be repaid in perpetuity.
ZG: Yes, you’re right. Well, the Greek government, we all know, has a gun to its head. I mean, [the institutions say] that you will pay all debt, otherwise we destroy you in the next minute, by completely turning off the taps of your banks. Of course, I think that a patriotic government would have publicized such threats without being afraid, but unfortunately, our government has not done so.
I believe that [the institutions] are aware of fraud committed by [members of the Greek government], and they tell them, if you go on to publicize the threats, we are going to reveal to the Greek people your actual fraudulent behavior, the bribes you receive from German companies like Siemens, which has come out actually, and then a lot of other organizations in Europe.
For example, the Greek government has purchased submarines, spending a huge amount of money for submarines that go down to the bottom of the sea and never come back up. The Greek people have paid all this money, in addition to huge bribes on the side for particular [government] ministers, for “well-working” submarines and a lot of other weapons actually, planes which fall down and all these kinds of things. All of these European governing [authorities] know of this fraud [that has been perpetrated] by Greek politicians, so they actually tell them, “go on, publicize our threats, we’ll reveal everything you’ve done so that you will not be re-elected by the stupid Greek people.”
MPN: Could you share with us your opinion regarding the role of foreign banks and financial firms in the development and outbreak of the Greek economic crisis?
ZG: There is evidence that the German and French banks were bankrupt in 2008, because they had a lot of toxic American debt. Also, they owned a sizable quantity of Greek state bonds. Falsely augmenting the Greek deficit [was done] in order to load us with unnecessary loans which go back to their banks, so that Greece buys back [its] bonds, so that the German and French banks can refinance their debts. This was a very appetizing idea [for the banks]. This has been actually said by people like [Paul] Krugman and a lot of other researchers and scientists, American and European.
MPN: In your estimation, what should be done and what can be done in order for Greece to turn the page and change direction?
ZG: This is a very difficult question. Greece has through the centuries been under [the thumb of] foreign invaders, first military and now economic, but we have always survived. Greece is a rich country in terms of physical and human resources. However, our politicians have systematically been generously bribed by Western foreigners in order to be able to rob Greece’s wealth.
Also, our geopolitical situation is very attractive to world powers in their struggle to govern the world. These days, Germany is trying its last, and I hope unsuccessful, attempt to rule Europe and the world, using our long-suffering little country as a guinea pig to [conquer] the rest of the European countries.
In my opinion, in Greece, a patriotic and caring government has to get out of the Eurozone. We have to have our own monetary policy to control our banks and to have our own currency. This will be difficult, of course, because we have sold such a great portion of our wealth, but a good government can reverse this. We have to have our own monetary policy and our own central bank that we control, in order to go on to growth.
Also, we have to ask the United Nations to implement the human rights clauses of international law, because Greece has a large portion of people who are very hungry. I live in a rich suburb of Athens [and also] in Thessaloniki, and I see, in the night, old people in these suburbs, previously good-standing people who worked until 65 or 67 years of age—and all claims to the contrary are nonsense and lies—and they are searching in the waste bins in the street to find vegetables thrown out by other people.
The supermarkets in Greece ask customers to buy rice and milk for children of families who are in absolute hunger and poverty. I have seen people, families with two and three children in Thessaloniki, who live in their own cars, they don’t live in a house. They come to the university, where there are rooms for the visiting scholars and professors to have a place to stay, and they come there to take a bath. This situation is a shame for Europe.
Also, they have loaded us with lots, with millions of refugees. The Syrian people are suffering and we have to accept them and we are caring for them, but also there are people who are not refugees. They come to Greece from a lot of other places in the world, from Africa, from Asia, from Bangladesh, from India and from a lot of other places. We don’t hate these people, we are actually helping them and we are famously, from antiquity, people with good intentions towards foreigners and visitors.
But you can’t have so many young people in Greece who have no work. The unemployment among young people in Greece, from 25 to 45 years of age [is very high]. We have all these young people who have a lot of energy, and what are they going to do? It’s natural and logical. We have a lot of crime here, by Greeks, they will steal even one euro or ten euros. All this is known to the United States government and the European Commission and the governing parties, the European Parliament, officials who receive such high salaries, 25,000 euros per month with all the privileges. It’s a shame.
At the same time, the Greek people are suffering here. Very few people are those, the politicians and their friends, who are doing well. Also, people who have married [foreigners] and who have some other sources of income, like myself. I have married an Englishman, and he helps me with my 99-year-old mother. I have worked for 42 years, and my salary is not enough to support the medicine and all the care for my mother. There are other people in much worse situations than me.
A patriotic Greek government should go to the United Nations and ask for the implementation of the humanistic clauses of international law [so that it can] stop paying the debt [immediately]. Later, when we start growing we can pay the debt, but [only] debt which is legal, not the odious debt. We have to find out which is the odious debt with a real accounting committee.
[I would like to add] that Greek people can go on with only bread and olives to feed themselves if they have hope that we are going to get our country back and we are going to have some growth. They can suffer some sacrifices and be happy about it, but now they have lost hope and they are desperate, a lot of them commit suicide. We can survive if we get out of the terrible euro, which is a disguised German Deutschmark that serves only German interests and nothing else.
Greece may be small and governed by corrupt and unpatriotic governments, but it [is reluctant to] die. The Germans and whoever else will learn this the hard way, I believe.
Documentarist & video-activist Kazım Kızıl who was arrested while following the post-referendum protests in Izmir, misses his camera the most while in prison. Kızıl says “I will first hug my camera, and then my family and friends. I want to go on a vacation then; look at fields full of flowers, dive into rivers. I want to go a little crazy. It is not this prison that makes me crazy, it is liberty itself.”
Kazım Kızıl, having been behind bars since April 22 has answered Seyhan Avşar’s questions for Cumhuriyet Daily. He was arrested with claims of having insulted the president, which he states is not likely himself. “Insult is not my personality. I have nothing I cannot say through valid criticism to revert to insult. There are currently two court cases against me and an investigation. Both of the court cases are about journalism, regarding the news pieces I was following; and the investigation has started due to my participation in ‘Cinema for Peace’. If I am to summarize the situation in Metin Altıok’s lines, ‘I am dangerous for some, to be burned at stake, to set an example.’ The will is obvious; to prevent police violence on camera. Yet I continue to repeat, ‘Journalism is not a crime!’ Kızıl answers Avşar.
I had been working on a series of documentaries regarding child labor prior to my arrest. Kids who work at tobacco fields with their parents, unpaid labor which is not considered work officially; the production of the first of series was complete for ‘Where are you, Friend?’. There was only the soundtracks and color correction remaining. Reflections of my childhood are in this documentary, which takes its name from Yaşar Kemal’s book that consists of his interviews with children. The second film was to be about Syrian child-workers. And the third one would be about the crony-businessmen erecting skyscrapers in Izmir’s Bayraklı, titled “Penises of Izmir”.
This is the first time I enter a prison in my life. I have been subjected to psychological harassment and pressure. For a long time Erdoğan-marches were echoed in my ears. Thankfully later I have erased the Erdoğan-marches from my ears with folk songs of Neşet Ertaş and poetry of Turgut Uyar that I kept repeating from within myself, having learned them by heart. We stay 19 people in a room for 8. Five of our friends sleep on the floor. Our letters are kept waiting in ‘reading committees’.
The books in the prison were finished only in a few days. I have started working on my English. I keep writing essays, articles, stories. Just like Sait Faik (Abasıyanık) has said ‘I would go crazy if I did not write’.
Whatever has been written about President Emmanuel Macron by the yellow or the respectable press has been mere trivia or total falsehood.
Media lies have a purpose that goes beyond Macron’s election. Throughout Europe and North America, bankers and manufacturers, NATO, militarists and EU oligarchs, media moguls and verbal assassins, academics and journalists, all characterized the election victory of Macron as a ‘defeat of fascism’and the ‘triumph of the French people’.
Macron and ‘What People’?
First of all, Macron received only 46% of the actual vote. Over 54% of eligible French voters either abstained, spoiled their ballots or voted for Marine Le Pen, the nationalist populist. In other words, 26 million voters rejected or ignored Macron’s candidacy versus 20.6 million voters who endorsed him. This was despite an unremitting push for Macron from the entire French and European mass media, all of the major political parties and the vast majority of academics, journalists, publishers, undertakers and doormen.
In a word: Emmanuel Macron is a minority President, unpopular to most of the French electorate.
There are some very sound political and socio-economic reasons why Macron’s candidacy would be rejected by most of the French people, while receiving full support from the ruling class.
Secondly, there was a phony image of Macron as the ‘novice, untainted by old-line corrupt politics’. The financial and business press busily painted an image of the virgin Manny Macron bravely prepared to introduce ‘sweeping reforms’ and rescue France – a sort of banker-Joan of Arc against the veteran ‘fascist’ Marine Le Pen and her ‘deplorable’ supporters.
The reality is that Macron has always been a highly experienced member of the most elite financial-political networks in France. He served as a senior executive in the notorious Rothschild banking conglomerate. In a few short years ‘Saint Manny’ had accumulated millions of euros in commissions from fixing corporate deals.
Macron’s financial colleagues encouraged him to accept the post of Economic Minister under the decrepit regime of President Francois Hollande. Banker Macron helped the ‘Socialist’ President Hollande shed any of his party’s pro-labor pretensions and embrace a radical anti-worker agenda. As Economic Minister Macron implemented a 40 billion euro tax cut for businesses and proposed far-right legislation designed to weaken workers collective bargaining rights.
The Hollande-Macron proposals faced massive opposition in the streets and parliament. With the government’s popular support falling to the single digits, the anti-labor legislation was withdrawn or diluted … temporarily. This experience inspired Macron to re-invent (or re-virginized) himself: From hard-assed rightwing hack, he emerged the novice politico claiming to be ‘neither right nor left’.
The totally discredited ‘Socialist’ Hollande, following the example of France’s financial elite, supported presidential candidate Macron. Of course, whenever Macron spoke of representing ‘all France’, he meant ‘all’ bankers, manufacturers and rentier oligarchs – the entire capitalist sector.
In the first round of presidential voting, Macron’s candidacy divided the elites: Bankers were split between Macron and Fillon, while many social democrats, trade union officials and ‘identitarian’-single issue sectarians would end up voting Macron.
Macron won by default: Fillon, his far right bourgeois rival was snared in a political- swindle involving ‘family’ and his finicky supporters switched to Macron. The Socialists defected from their discredited Hollande to the ‘reconstructed choirboy’ Macron. Meanwhile, the ‘left’ had rediscovered ‘anti-fascism’: They opposed the national-populist Le Pen and slithered under the bankers’ backdoor to vote for Macron.
Almost one-third of French electorate abstained or showed their contempt by spoiling their ballots.
Throughout the election theatrics, the media breathlessly reported every frivolous ‘news’ item to polish the halo of their ‘novice’ Macron. They swooned over the ‘novelty’ of Macron’s teen age ‘love affair’ and subsequent marriage to his former schoolteacher. The media played-up the charmingly ‘amateurish’ nature of his campaign staff, which included upwardly mobile professionals, downwardly mobile social democrat politicos and ‘off the street’ volunteers. The mass media downplayed one critical aspect: Macro’s historic ties to the big bankers!
Behind the carefully crafted image of a ‘political outsider’, the steely eyed Macron was never influenced by the swooning media propaganda: He remained deeply committed to reversing fifty years of working class advances in France in favor of the financial class.
Macron’s Power Grab: En Marche to Defeat the Working Class
Immediately upon his election, Macron presented his first major piece of legislation: The ‘liberalization’ (reversal) of France’s progressive and socially protective labor laws.
President Macron promised to eliminate industry-wide labor-capital negotiations, in favor of factory-by-factory negotiations. Undermining industry-wide collective power means that each monopoly or conglomerate can dominate and isolate workers in their work place. Macron envisions a complete shift of power into the hands of capital in order to slash wages, increase work hours and reduce regulations on workplace safety and worker health. The proposed anti-labor laws represent a return of capitalist power to the golden age of the late 19th and early 20th centuries – precisely why the financial elite anointed Macron as ‘President of all France’.
Even more important, by destroying a unified, labor movement and the power of workers’ solidarity, Macron will be free to radically restructure the entire socio-economic system in favor of capital!
Concentrating all power and profits in the hands of the capitalist class, Macron’s legislative agenda will free him to fire over 150,000 public employees, drastically reduce public spending and investment and privatize critical public financial, energy and industrial sectors.
Macron will shift the balance of power further away from labor in order to increase profits, reduce middle and working class social, health and educational services and to decrease corporate taxes from 33.3% to 25%.
Macron plan will strengthen the role of the French financial elite within the European Union’s oligarchical structure and allow the bankers to impose harsh ‘austerity’ policies throughout Europe.
In the sphere of foreign and military affairs, Macron fervently supports NATO. His regime will back the aggressive US military policies toward Russia and the Middle East – especially the violent breakup of Syria.
President Macron’s reactionary, ‘liberalizing’ agenda will require his party and allies to gain a majority in next month’s parliamentary elections (June 2017). His strategy will consist of ‘diversity in appearance and hard, single-minded reactionary policies in content’.
The ‘diverse’ groups and individuals, allied with Macron, are largely composed of fragmented collections of opportunists and discredited politicos mainly in search of office. Under Macron, the parliament will include everything from old-line rightwing social democrats, as well as single-issue environment and gender opportunists, allied with conservatives looking for a chance to finally savage France’s labor laws.
If successful in the coming elections, Macron’s parliament will legitimize the policies of his far right Prime Minister and Cabinet. If Macron fails to secure an outright majority, he is sure to patch together a coalition with veteran right-wing politicos, which, of course, will be ‘balanced’ with 50% women. Macron’s coalition of dinosaurs and ‘women’ will eagerly smash the rights and living standards of all workers – regardless of gender!
Macron hopes to win sufficient parliamentary votes to negotiate alliances with the traditional conservative parties and the rump of the Socialist Party to consolidate the rule of the Troika: the bankers, the EU and NATO.
President Macron: By the Ballot or the Bullet
There is no doubt that the French working class, the salaried public and private employees, the unemployed youth, students and public health workers will take to the streets, with the backing of 60% or more of the public, including the 33% who voted for Marine Le Pen.
Strikes, general and partial, of long and short duration, will confront the Macron regime and its far right, self-styled ‘transformative’ agenda.
Rothschild’s errand boy, Manny Macron cannot mobilize supporters in the streets and will have to rely on the police. Many parliamentary backers are fearful of both the problem (strikes) and the solution (police repression).
The Corporate Elite: President Macron Adopts Napoleonic Decrees
In 2016 when Macron was the Economic Minister in the President Francois Hollande’s regime, he introduced a new regressive labor policy dubbed the ‘El Khomri’ law (named after the reactionary Labor Minister Myriam El Khormi). This led to massive street demonstrations forcing Hollande to withdraw the legislation. Now as President, Macron proposes a far more rigid and destructive labor law, which his corporate colleagues insist he implement by the ‘ballot’ if possible or the ‘billy club’ if necessary. In other words, if he cannot win the support of the National Assembly, he will implement the labor law by presidential decree.
The President of MEDEF (Mouvement des Entreprises de France), the employers’ federation, Pierre Gattaz, has demanded immediate implementation of policies to crush labor. Macron will outlaw labor protests via presidential decreeand cut parliamentary debate in order to transform the elite’s ‘El Dorado’ of all (labor) reforms (sic) into reality.
The entire leadership of the capitalist class and financial press backs Macron’s bid to govern by decree as a ‘good idea in the circumstances’, (Financial Times, 5/10/17, pg. 2). Macron’s ‘Napoleonic’ pretentions will inevitably deepen class polarization and strengthen ties between the militant trade unions and Le Pen’s industrial working class supporters.
We face an approaching time of open and declared class war in France.
Reality has quickly cut through the lies about the origin of Emmanuel Macron’s electoral victory. Brutal police truncheons, wielded in defense of Macron’s election triumph, will further reveal the real faces of French ‘fascism’ better than any editorial by the French ‘left’. The fascists are not to be found among Le Pen’s working class voters!
The fools within the French academia, who backed the Rothschild candidate in the name of ‘fighting fascism at all cost’, will soon find themselves wandering among the workers’ street barricade, dodging the clouds of teargas, on the way to their cafes and computers.
The ruling class chose Macron because they know he will not back down in the face of street demonstrations or even a general strike!
The intellectuals who backed Macron as ‘the lesser evil’ are now discovering that he is the greater evil. They are not too late to be … irrelevant.
Macron’s grandiose vision is to introduce his hyper-capitalist ideology throughout Europe and beyond. He proposes to transform the EU into a ‘competitive capitalist paradise under French leadership’.
Given the historic role of the French worker, it is more likely that Macron will not succeed in implementing his ‘labor reforms’. His decrees will surely provoke powerful resistance from the streets and the public institutions. When he falters, his parliamentary supporters will fracture into little warring clans. Factory owners will bemoan the workers who occupy their plants and bankers will complain that the farmers’ tractors are blocking the roads to their country villas.
The Germans and British elite will urge their ‘little Napoleon’ to hold firm, for fear the ‘French contagion’ might spread to their somnolent workers.
On the one hand, Macron’s successful decree can open the way for a transformation of capital-labor relations into a modern 21st century corporate state.
On the other, a successful general strike can open the door to a Europe-wide revolt. Macron’s enigmatic (and meaningless) slogan ‘neither right nor left’ is now exposed: He is the “Bonaparte of the Bourse”!
For the past 20 years Washington has aggressively pursued the age-old imperial strategy of ‘divide and conquer’ throughout the Middle East, Southwest Asia and East Africa. Frustrated at its inability to control national policy of various independent nation-states, Washington used direct and indirect military force to destroy the central governments in the targeted nations and create patchworks of tribal-ethno-mini-states amenable to imperial rule. Tens of millions of people have been uprooted and millions have died because of this imperial policy.
Washington’s strategy of fragmentation and secession follows closely the “Greater Israel Plan” set forth by Israeli politico-military writer Oded Yinon in February 1982 and published by the World Zionist Organization. Yinon maintained that the key to Israel’s domination of the Middle East rested on fostering ethno-religious and regional divisions. Following the Yinon Plan, in the first instance, Tel Aviv signed accords with Jordan and Egypt to break-up Arab regional support for the Palestinians. It then proceeded to fragment what remained of Arab-Palestine into small warring enclaves between the West Bank and Gaza. Israel then sub-divided and settled wide swatches of the West Bank with the collaboration of the corrupt ‘Palestinian Authority’ under Mahmoud Abbas.
Israel’s ‘divide and conquer’ strategy toward the Greater Middle East depended on its placement of ‘Israel First’ officials in top policymaking positions of the US Defense, State and Treasury Departments and the power of the Zionist Power Configuration (ZPC) — the so-called “Israel Lobby” – to control the US Congress and Presidency in matters related to Israel.
The Israeli Mid-East strategy of fragmenting and weakening pro-Palestinian governments thus become the official US policy toward Arab countries.
This policy has not been limited to the Arab Middle East: Israel and US policymakers intervened to undermine the ‘pro-Palestinian’ government of Sudan by supporting a secessionist war to create a huge resource-rich ‘Southern Sudan’ conglomeration of tribal warlords, leaving a devastated region of mass murder and famine.
Somalia, Libya and Ethiopia were also riven by regional wars financed and armed by the US with overt and covert Israeli operatives and advisers.
Israel’s policy to weaken, fragment and destroy viable developing countries, differed from the traditional policies of colonial regimes, which sought to conquer and exploit unified nation-states. Washington has blindly followed Israel’s imperial ‘model’ without assessing its impact on US interests and thus undermining its past practice of economic exploitation of viable nation states.
‘Israel First’ officials within the US federal administrative policy-making bodies played a decisive role in fabricating the pretexts for the 2003 US invasion and destruction of Iraq. They pushed fake ‘documents’ alleging Iraqi ‘weapons of mass destruction’ and they promoted a plan to sub-divide the country in three ethnically ‘cleansed’ regions: Kurds (as Israel’s allies) in the North, impoverished Sunnis in the center and easily controlled Shia tribal leaders in the South.
The policy of dismantling a central government and promoting regional fragmentation backfired on the US authorities in Iraq: Sunni insurgents, often trained by experienced Baathist (former Iraqi Army) officers, formed the ‘Islamic State’ (ISIS), which took over major cities, slaughtering all non-Arab, non-Sunni residents, and threatened to established an independent state. The Shia-led government in Baghdad turned to Iran for support, forcing the US, Israel and the Kurds to declare war against ISIS, while trying to retain the weakened Sunni tribal clients. No viable central government remains in the once powerful multiethnic republic of Iraq.
The US joined Saudi Arabia in invading and bombing Yemen to destroy the Houthi rebels and favor the Sunni Salafist groups allied to al Qaeda. The goal was to weaken Yemen and prevent popular Yemini revolts from spreading to Saudi Arabia as well as undermining any Houthi alliances with Iran and expression of support for Palestine.
The US directly invaded Afghanistan expecting to easily conquer and ‘neatly’ subdivide that enormous region and ‘skillfully’ pit the various regional ethno-tribal groups against each other – while setting up a lucrative and militarily strategic site for launching future wars against US (and Israeli) rivals in Iran, Central Asia and China.
The battle-hardened Afghan Islamist Pashtun guerrilla-fighters, led by the Taliban, and unified by ethno-religious, national, tribal and extended family ties and customs, have successfully resisted this divide and conquer strategy. They now control most of the countryside, infiltrating and influencing the armed forces and police and have driven the US forces into garrison airbases, reliant on dropping mega bombs from the stratosphere.
Meanwhile, blinded by the media propaganda reports of their ‘successes’, Washington and the NATO powers launched a bloody surrogate war against the secular nationalist government of Syria, seeking to divide, conquer and obliterate an independent, pro-Palestine, pro-Iran, ally of Russia.
NATO’s invading armies and mercenary groups, however, are sub-divided into strange factions with shifting allegiances and patrons. At one level, there are the EU/US-supported ‘moderate’ head-chopping rebels. Then there are the Turkey and Saudi Arabia-supported ‘serious’ head-chopping al Qaeda Salafists. Finally there is the ‘champion’ head-chopping ISIS conglomeration based in Iraq and Syria, as well as a variety of Kurdish armed groups serving as Israeli mercenaries.
The US-EU efforts to conquer and control Syria, via surrogates, mercenaries and terrorists, was defeated largely because of Syria’s alliance with Russia, Iran and Lebanon’s Hezbollah.
Syria has effectively been ‘chopped up’ by competing imperial and regional powers leading to a possible confrontation among major powers. The US-Kurdish-Turkey conflict provides the most immediate danger of serious open warfare among major nations.
Among the myriad surrogate groups that Washington supported in its seemingly contradictory policy of violently overthrowing the Syrian government in Damascus while seizing territory from ISIS, Pentagon strategists have relied most heavily on the Kurdish Syrian Democratic Forces (YPG). The US escalated its military support for the YPG, promising heavy arms and increased US ground and air support. Meanwhile, the YPG expanded its control of the Kurdish regions in Syria especially along the Turkish border, creating a powerful territorial tie of Syrian-Kurds with Turkish-Kurds and Iraqi-Kurds. The US generous supply of heavy weapons to the YPG has increased the Kurds capacity to fight Turkey for the establishment of a contiguous ‘Greater Kurdistan’. Moreover, the US government has publicly informed Turkey that its armed forces will provide a ‘shield’ to protect the YPG – and indirectly the PKK – from Turkish attack.
Turkish President Recep Tayyip Erdoğan is acutely aware that the YPG’s goal is to partition Southeastern Turkey and Northern Syria and form a Kurdish state with Iraqi Kurdistan. US Defense Secretary James Mattis’ pledge that ‘Washington is committed to protecting its NATO ally (Turkey)’ is ambiguous at best and most likely a hollow promise. Washington is counting on the Kurds as a strategic ally against both Damascus and ISIS. Only after accomplishing their twin goals in Syria might the Pentagon turn against the Kurds and support the Turkish government.
Complicating this scenario, the Israelis have long-standing ties with the Iraqi Kurds as part of their own divide and conquer strategy. Meanwhile, Tel Aviv has been bombing Damascus, aiding ISIS fighters in southern Syria (with material and ‘humanitarian’ medical treatment) while supporting YPG against the Syrian and Turkish militaries.
The Erdoğan regime is in a quandary: A victory for the Kurdish YPG and their occupation of territory along its border will materially threaten the ‘unity of the Turkish state’. An armed, unified Kurdish presence in this region will result in enormous pressure on Erdoğan from the nationalist political parties and supporters and the Turkish Armed Forces. On the other hand, if Erdoğan launches cross border attacks on the Pentagon-supported YPG it will directly face US ground and air power.
President Erdoğan is clearly aware that the US was involved with the silent ‘Gulanist’ permeation of the Turkish state leading up to the 2016 abortive Gulanist coup. Erdoğan’s scheduled meeting with US President Donald Trump in mid-May may not resolve the impending Turkish-Kurdish confrontation in Syria where the US is committed to protecting the YPG.
Washington hopes to convince President Erdoğan that the YPG will hand this strategic territory over to an amorphous, minuscule puppet Arab-led militia, presumably made up of non-Kurdish collaborates of the US-NATO-Saudi war against Damascus. It is hard to imagine the veteran politician Erdoğan believing a Pentagon plan for the YPG to just hand over its territorial patrimony after having fought and died to secure the region. The US is in no position to force the YPG to surrender its gains because the YPG is crucial to the Washington-Israeli-Saudi plan to destroy the central government in Damascus and fragment Syria into weak tribal mini-states.
Erdoğan’s imminent failure to get Washington support for his war with the Kurds will force him to play his ‘nationalist’ card: There will be more pro-Palestine rhetoric, more opposition to a Cyprus accord, more pro-Russia posturing and the ‘discovery’ of more and greater ‘internal threats’ to the great Turkish State.
Will Erdoğan be able defuse the hostility among his own and independent nationalist supporters?
One point is clear: A territorially-based powerful Kurdish militia, armed by the US, will be far more formidable threat to the unity of the Turkish state than the previous ill-armed rag-tag guerrillas in the mountains of northern Iraq.
It will be a humiliating defeat if Erdoğan surrenders to Pentagon demands and tolerates a US-YPG alliance on Turkey’s border. Erdoğan has some powerful options of his own: Turkey might deny the US Armed Forces access to its huge airbases in Turkey thus weakening NATO’s ‘southern flank’. A Turkish threat to withdraw from NATO altogether would have greater repercussions. Even the slightest hint of exercising these options would set off a ‘second coup’ against Erdoğan. This would involve a more serious US-NATO-backed uprising by senior Turkish officers, ‘nationalists’, democratic secularists and Kurds in major urban centers with ‘Gulanist’ politicians and bureaucrats waiting in the wings.
President Trump and the Pentagon may gain a foothold against Damascus with Kurdish surrogates in Northern Syria, but the loss of Turkey will be a strategic setback. Behind all of this confusion and devastation the partition of Syria and, eventually of Turkey, fits in very well with Greater Israel’s ‘Oded Yinon Plan’ for subdividing Muslim countries.
By Gürkan Özturan, 99GetSmart
Nuriye Gülmen and Semih Özakça have been on hunger strike for more than two months after exhausting the processes to be re-appointed to their positions as educators which they had been dismissed with a decree ruling of the State of Emergency Rule that has been declared in the aftermath of July 15 coup attempt.
Özakça was a teacher at Mardin Mazıdağı Cumhuriyet primary school until getting dismissed from duty with a decree ruling numbered 675, and Gülmen used to work at the Selçuk University until she was dismissed with decree ruling numbered 679 on January 5th. The two educators have been showing great strength in the face of pressure from government over the course of two months. They had been detained, but still continued their hunger strike. When they were to pass a critical threshold on day 45, the physicians’ chamber members wanted to get their consent forms for medical intervention if they were to lose consciousness; yet they refused to consent.
The two educators continue their hunger strike in the heart of Turkey’s capital, Ankara; only few hundred meters away from the Parliament. In a press interview, Gülmen had said “We have lost weight, and are well aware of the risks. We do not want to starve, hence our call to those in charge of getting our jobs back.”
Özakça had stated in an interview, “We not only want our jobs back, but also struggle for our honor. If we struggle together, we shall win. Our victory shall mean the end of fear atmosphere that the government wants to install in Turkey.”
While the two educators continue on day 65 of their hunger strike, there have been several solidarity hunger strikers in other cities and countries. Several other academics for peace, university students, politicians, artists have staged sit-in protests for a one-day hunger strike and have been on rotation, drawing attention to the heart of Turkey, where the two educators are conducting their strike.
PEN International has released a statement naming the worries about the health of Gülmen and Özakça; while in the Netherlands, people have gathered in Amsterdam’s Dam Square rallying in solidarity for the two.
As there have been national and international solidarity rallies to draw attention to injustice and inhumane treatment of the people who have been dismissed with decree rulings and stripped of certain rights, the Prime Minister Yıldırım had stated that he is unaware of the situation, asking if the two have been in prison, after main opposition leader Kılıçdaroğlu informed Yıldırım on the continueing hunger strikes.
After starting hunger strike on March 10th, the two educators are reportedly showing symptoms of Wernicke-Korsakoff Syndrome. According to Bianet’s news piece, Ankara Physicians Chamber has held a press meeting where they have announced that the two educators have been showing serious deterioration in health conditions which is a signifier of Wernicke-Korsakoff Syndrome. Chair of the Physicians’ Chamber, Vedat Bulut has announced that the critical stage has been passed and permissions for medical intervention should be taken, which the two strikers refuse to give. Especially Gülmen has been showing slowed down in heart beat, as well as dropped blood pressure.
10-15% of the people who pass the critical stage on day 45 lose their lives, while 77% lose their lives due to infections in later stages even after leaving hunger strike. 25% must get hospitalized and receive long-term healing and special care in order to come over physical and psychological problems.
Since the declaration of the State of Emergency Rule, more than 150 thousand people have been dismissed from their jobs and lost access to healthcare, education and employment market, including more than a thousand academics and tens of thousands of teachers. NGOs, unions, student movements and various human rights initiatives have been calling for an end to unjust treatment and sharing their worries regarding the hunger strikes.
During its 2017 Continental Assembly, held in Bogotá, Colombia from 24 to 27 April the Committee for the Abolition of Illegitimate Debt, in its South American, Latin American and Caribbean expression (CADTM / AYNA), discussed the situation in Venezuela, nationally and in the Latin America–Caribbean and worldwide context. This discussion stressed the themes and the goals which define the areas of activity of the CADTM, including the system of domination by government debt (internal and external), which is just one of the fundamental mechanisms used as an instrument of capitalist domination over the peoples of the world.
In this regard, in order to defend the sovereignty of the Bolivarian Republic of Venezuela and its people and the progress made during the Bolivarian revolution, we hereby express our conviction that to guarantee Venezuela’s sovereignty and to preserve the social, economic and democratic advances made, it is paramount that priority be given to meeting the needs of the people over the repayment of government debt (external and internal) as the path to resolving the current crisis and that the greater part of available resources be allocated to ensuring the country’s recovery and the respect of its independence.
Consequently, we reiterate our proposal to accompany popular initiatives aimed at obtaining the suspension of debt repayments in order to free resources needed elsewhere given the country’s present urgent situation, which threatens its process of emancipation. We are putting at the disposal of Venezuela’s people, of its social and popular movements and its national government, our experience in struggles related to debt and our expertise in conducting public and citizen debt audits in several countries (including Ecuador, Greece, Brazil and municipal audits in Spain), in order to contribute to making such an audit a reality in the Bolivarian Republic of Venezuela. Its purpose will be to detect illegitimate elements of the debt so that the country’s financial resources can be used for the benefit of its people and to guarantee their rights. We view the perspective of this audit as including financial debt but also environmental debt, historical debt and social debt, on the example of the proposal made publicly by Hugo Chávez in 2006 at the World Social Forum in Caracas. We reaffirm the appeal made by CADTM / AYNA (http://www.cadtm.org/CADTM-AYNA-appeals-to-the), which offered its support to the people and government of Venezuela for conducting such an audit at the World Assembly of the CADTM network in Tunis in 2016.
The conducting of this audit, which the CADTM network present in Venezuela (Red Venezolana Contra las Deudas or Venezuelan Network Against Debt) has long called for and which is now supported by the Platform for Public and Citizen Auditing (Plataforma por la Auditoría Pública y Ciudadana – https://auditoria.org.ve), is closely linked to the exercise of the right to information in public affairs and the obligation to guarantee that right that is incumbent on civil servants of the State in conformity with the Constitution of the Bolivarian Republic of Venezuela, anti-corruption legislation and the laws empowering the population and providing for citizen oversight. Information and social participation are essential to democracy and popular sovereignty.
In consideration of the foregoing, we propose the creation of an International Commission in support of those who promote a public and citizen audit of debt in Venezuela.
Further, in light of the current economic situation faced by the Venezuelan nation, threatened by interference and intervention by the OAS [Organisation of American States] and the USA, we hereby express our categorical refusal of all forms of interference and interventionism that violate the sovereignty of Venezuela as a people and as a nation. We condemn with equal firmness all the threats and manoeuvres attempted against Venezuela in the service of outside interests and capitalist appetites. It is our hope that the conflicts in Venezuela will be resolved by peaceful, democratic and constitutional means, and not through violence.
Finally, we recommend the opening of a public debate in Venezuela on the question of debt and a public and citizen audit and on the sensitive issue of seeking alternatives to the rentier-extractivist model, an example of which is the Orinoco Mining Arc, |1| a project which is closely linked to the debt system and which raises profound concerns over its environmental and social-cultural impacts as well as its reliance on transnational capital.
It is our hope that the institutions will fully facilitate the democratic process so that all concerns, grievances, warning signals, results of enquiries and liberating alternative proposals can be heard.
Translation: Maud Bailly, Snake Arbusto, Mike Krolikowski
|1| Translator’s note: The Arco Minero del Orinoco [https://news.mongabay.com/2016/10/t…] is a “new strategic national development zone” created by Venezuelan President Nicolás Maduro by presidential order on 24 February 2016. This project sets aside an area covering nearly 112,000 sq. km. (larger than the total land area of Portugal), or 12 % of the national territory, to the exploitation of gold, diamonds, coltan, iron and other minerals by large national and transnational mining companies. The project has generated strong criticism due to its rentier-extractivist nature, since its goal is to obtain currency revenues in the short term at the expense of the environmental destruction of a significant proportion of the national territory rich in biodiversity and water reserves, and of the rights of the Amerindian peoples who live in the region.
For almost 50 years, the US economy and society has taken a great leap backward — accelerating during the past three Presidencies. Not only have we experienced the reversal of past socio-economic legislation, but also our presidents and Congress have dragged us into multiple aggressive wars. Now, the threat of a nuclear attack against our ‘declared enemies’ is ‘on the table’.
Since the end of the Viet Nam war, US military ‘interventions’ have become wars of long duration. These have cost millions of lives overseas, tens of millions of refugees and scores of thousands of American soldier deaths, permanent injury and serious mental and neuropsychiatric damage. There is no ‘light at the end of the tunnel’, to quote the US General William Westmoreland.
In retrospect, and after 50 years of decline, the much-maligned Presidency of Richard Milhous Nixon now stands out as a golden age of social, environmental and inter-racial advances, as well as an era of successful peace negotiations and diplomacy. President Nixon, never an ideologue, accepted the reality of a multi-polar world.
Of course, the Nixon Presidency was characterized by serious crimes against humanity, such as the CIA-sponsored coup d’état against the democratically elected Chilean President Allende, the bombing of Cambodia and the genocidal invasion of the newly independent country of East Timor.
Today, he is best known for the far-less consequential events around the ‘Watergate’ scandal and related domestic civil rights abuses and corruption. It was the mass media and Democratic Party politicos who have grossly inflated the election campaign chicanery, leading up to the bungled break-in of the Watergate Hotel headquarters of the Democratic Party, which led to Nixon’s impeachment and resignation. To today’s media spin-masters, ‘Watergate’ was the defining event of President Nixon’s Presidency.
Ironically, after Nixon resigned from office even greater disasters occurred. This paper will enumerate these and compare them with the Nixon presidency.
Far from pursuing diplomacy and peace, subsequent presidents, both ‘liberal’ Democrats and ‘conservative’ Republicans, invaded Nicaragua, Afghanistan, Panama, Grenada, and Angola and initiated a dozen other highly destructive and economically devastating wars. The two oligarchic parties took turns in shredding Nixon’s comparatively peaceful legacy.
President Nixon, under the advice of National Security adviser, Henry Kissinger, supported Israel’s invasion of the Arab countries in 1973 as well as the bloody Chilean military coup in 1973.
President Nixon cynically designed the ‘Southern Strategy’, which transformed the Democratic Party-controlled racist fiefdoms of the US South into racist Republican-controlled states.
Progressives, liberals and self-styled democratic-socialists have played a leading role in ignoring Nixon’s ‘golden years’ in terms of domestic and international policy achievements. Instead they focused on inane and infantile name-calling, like “Tricky Dick”, to describe the man. By doing so, they have failed miserably to discuss national and international issues of historic importance. They have deliberately fabricated a distorted picture of the Nixon era to cover-up for the gross failures of subsequent Democratic Party controlled Congresses and Democratic Presidents.
In this essay, we will briefly outline Richard Nixon’s policies and executive initiatives, which justify our designation of the Nixon’s ‘golden years’, especially in comparison to what has followed his era.
President Nixon: The Great Leap Forward
In the sphere of political, economic and social life, President Nixon pursued policies, which ultimately advanced peace in the world and social welfare in the United States.
In foreign policy and diplomacy, Richard Nixon ended both the draft of young Americans into the armed forces, as well as the decade-long US military occupation of Indo-China, effectively ending the war — and acknowledging the hard victory of the Vietnamese National Liberation Front. The war had cost millions of Southeast Asian lives.
Nixon visited Beijing and recognized the ‘existence’ of the People’s Republic of China, effectively ending a quarter century of economic blockades and military threats against the billion-plus population of the PRC under three Democratic (Truman, Kennedy and Johnson) and one Republican (Eisenhower) Presidential Administrations. He established full diplomatic relations with China.
Nixon initiated the Security Arms Limitation Talks (SALT) agreements with the USSR and developed diplomatic policies, which recognized the possibility and necessity of peaceful co-existence between different social systems.
On the domestic front, President Nixon established the Clean Water Act and established the Environmental Protection Agency (EPA), with a Federal Government mandate to fight polluters and hold them accountable for the ‘cleanup’ of the environment.
Nixon proposed a National Health Insurance Program — an expansion of Medicare to cover the health needs of all Americans. This radical proposal (a version of ‘single payer’) was attacked and defeated by the Democratic Party, led by Massachusetts Senator Ted Kennedy who was backed by ‘Big Pharma’, the AMA and the growing corporate ‘health’ industry.
Nixon imposed price and wage controls that constrained inflation and price gouging and actively punished commodity ‘hoarding’. This was a time of rapid inflation and shortages due to the ‘Oil Embargo’. With these measures, he incurred the wrath of Wall Street, big business and the financial press.
Nixon promoted consumer rights, supplemental legislation to expand Social Security, especially for the handicapped, while defending the retirement age for pension eligibility.
Under Nixon, union membership rose to 30% of the workforce — its high point before its precipitous decline to 12% under subsequent US Presidents.
Nixon increased salaries of federal employees and real wages rose. In the following half-century real wages have declined to only 10% of their Nixon era value!
Nixon indexed Social Security to the real rate of inflation.
The Nixon Presidency initiated the Affirmative Action program and used the Federal Government to push for the desegregation of schools, leading to the first large-scale integration of public education in the South. President Nixon created the Office of Minority Business Enterprises (OMBE); the Occupation Safety and Health Agency (OSHA); and the Legacy of Parks Programs.
Nixon proposed a guaranteed annual wage for American workers, which both Democrats and Republicans rejected and defeated! He promoted Keynesian industrial policies against the financial elites with their mania for speculation.
President Nixon appointed four Supreme Court Justices during his term. Three of his appointees supported the groundbreaking ‘Roe versus Wade’ decision protecting women’s reproductive rights.
Under Nixon the voting age was reduced from twenty-one to eighteen years — giving millions of young Americans a greater political voice.
When Nixon spoke in favor of gun control, both the Republican and Democratic Parties opposed his proposals.
President Nixon supported the Equal Employment Opportunity Act and the Endangered Species Act, which have remained critical to social and environmental justice.
Richard Nixon was not a ‘single issue’ President. The span and depth of his progressive agenda, included fundamental changes in favor of environmental and racial justice, working class economic security and broad-ranging health issues, peace and co-operation with China and the USSR, women’s rights through Supreme Court decisions; pensioners’ rights, and animal rights advocacy. He reduced economic inequalities between the richest 1% of capitalists and the working class. Under President Nixon inequality and the concentration of wealth in the US were far less than they became with subsequent US Presidents and especially during the Obama Administration.
No President, with the possible exception of President Franklin Roosevelt’s Great Depression Era legislation, even remotely achieved Nixon’s domestic socio-economic successes. President Roosevelt, one must not forget, operated under the immense pressure of massive working class strikes and in preparation for World War II, while President Nixon achieved his policy advances during a time of relative ‘peace’.
The Post-Nixon Bi-Partisan Regression
In the 41 years since Nixon’s resignation (1976-2017) there has been a systematic rollback of virtually all of the Nixon agenda. Congress, the liberals, the mass media and Wall Street immediately switched from denigrating Nixon, to praising Democratic President ‘Jimmy’ Carter’s reversal of Nixon’s foreign policy achievements.
Contrary to his media-polished image as a ‘Bible-thumping champion of human rights’, President Carter dismantled Nixon’s policies promoting peace with the USSR and China, especially when he appointed the rabidly anti-Russian, anti-communist Zbigniew Brzezinski for National Security Adviser. The duet created the public image of Carter mouthing human rights rhetoric while Brzezinski formulated a policy of backing dictators and funding Islamist (jihadi) terrorists to undermine Soviet allies. The two-faced ‘Evangelical Christian’ Carter sent confidential letters of US support for the brutal dictator Somoza to prevent the Sandinista victory in Nicaragua, while issuing platitudes about peace in Central America.
Carter worked closely with the military dictatorship in Pakistan and the ‘head chopping’ monarchs in Saudi Arabia to launch the bloody forty-year war in Afghanistan, a Soviet Ally. The Carter-Brzezinski-promoted mujahidin war against secularism in Afghanistan led directly to the rise of Islamist terrorism, the Taliban and al Qaeda. Carter’s ‘freedom fighters’ systematically massacred secular schoolteachers for ‘the crime’ of educating Afghan girls in the countryside.
In order to undermine the USSR and other socialist or independent secular countries with Muslim populations, the Carter-Brzezinski duet financed and trained the Saudi-indoctrinated Al-Qaeda terrorists. They were delighted when it spread its poison across the Middle East, Asia, Africa, the Balkans and the Soviet Union promoting separatism and ethnic cleansing. Their cheers ceased somewhat on 9/11/2001.
Domestically, Carter’s deregulation of price controls led to double-digit inflation and set in motion the long-term decline in wages and salaries, which still plagues the American lower middle and working classes.
Carter appointed Chairman of the Federal Reserve Paul Volcker, who implemented draconian anti-inflationary ‘austerity’ policies reducing domestic consumption and opening the way for the de-industrialization of the economy.
The seismic change in the US, the ‘financialization’ of the domestic economy started under Jimmy Carter and was deepened and expanded under the subsequent Presidents Ronald Regan, George H W Bush, Sr., ‘Bill’ Clinton, George W. Bush (Jr) and Barack Obama. Poverty and permanent unemployment followed.
With deindustrialization, labor union membership declined from 30% of the private labor force under Nixon to less than 7% today. Organizing workers was no longer a priority: The AFL-CIO leaders were too busy chasing after the Democrats for handouts (and get-out-of jail passes).
After Carter, the Republican President Ronald Reagan doubled military spending, brutally broke the strike of the Air Controller’s union by jailing its leaders, whipped up the revival of US interventionism by invading Grenada and sending Special Forces to join the death squads murdering tens of thousands of peasant activists in Guatemala, El Salvador and Honduras.
President Reagan’s ‘free market’ polices encouraged US multinational corporations to relocate their factories overseas to Mexico, the Caribbean and Asia, costing millions of US workers well-paying jobs and reducing the number of unionized jobs. The stock markets and profits rose while the ‘American Dream’ of lifetime stable employment in industry began to fade.
Reagan’s threats and his huge military build-up forced the USSR to overspend in arms and strangle its growing domestic consumer economy.
The Reagan-Thatcher (British PM) era marked the demise of social welfare. They imposed the doctrine of ‘globalization’ — in essence, the bellicose revival of Anglo-American imperialism and the end of domestic industrial prosperity.
George HW Bush ‘negotiated’ with Russian President Gorbachev the break-up of the USSR. Despite Bush’s promises not to place US-NATO forces in former Soviet-allied countries, the following period saw the huge US-NATO expansion into Eastern Europe, the Balkans and Baltic states. President Bush (Sr.) invaded and savaged both Panama and Iraq, restarting the epoch of permanent US wars.
President George HW Bush promulgated the unipolar doctrine of US world domination, known as the ‘Bush Doctrine’.
The Reagan-Bush regimes emptied the content of the Nixon-era progressive agencies in terms of civil rights, consumer and environmental protection, and wage protection. Unionization declined by over a third.
After ‘war-monger’ President ‘Papa’ Bush, the Saxophone-playing President ‘Bill’ Clinton was elected. While crooning the words, ‘I feel your pain’, to American workers and racial minorities, Clinton unleashed Wall Street, ending regulation of banks and investment houses. He re-appointed Alan Greenspan to head the Federal Reserve, a proven master of grotesque financial speculation and the godfather of economic crisis (2007-2009).
President Clinton, passions aroused by the animal spirits on Wall Street (and inside his White House office), launched a vicious assault on the social welfare state, and in particular, low-income working families, single parents and African-Americans. Clinton’s promotion of “Workfare” forced single mothers to accept unsustainable minimum wage jobs under the threat of ending any welfare support, while not providing any mechanism for child care! This one policy savaged hundreds of thousands of vulnerable families. Under Clinton, the prison industry exploded as a multi-billion dollar business.
During the 1990’s, Clinton backed the most retrograde pro-business, debt-ridden regimes in Latin America. Hundreds of billions of dollars of Latin American wealth was transferred to the US. Clinton’s ‘Golden Years for Wall Street’ were a decade of infamy for Latin Americans and led directly to major leftist revolts by the end of the Clinton era.
President Clinton deepened and widened the US military drive for domination in Europe and the Middle East. Clinton bombed and invaded Yugoslavia, especially Serbia — destroying large parts of its capital Belgrade. He bombed Iraq on a daily basis and increased the starvation blockade of that nation. He invaded Somalia and backed Israeli land grabbing-settlement expansion in Palestine. He supported the Israeli savaging of Lebanon. He committed treason by submitting to Israeli blackmail over his sex-capers with Monica Lewinsky and trying to release Israeli spy-US Naval analyst Jonathan Pollard. It was only after an open threat of wholesale resignations by the CIA and other security agencies that Clinton withdrew his proposal to free the traitor Pollard.
Finance capital flourished as Clinton repealed the venerable Glass-Steagall Act of 1933 against bank speculation. He promoted the hugely unpopular NAFTA, (North American Free Trade Agreement) leading to the loss of over two million industrial jobs, as US multinationals absconded to Mexico, where wages were less than one-fifth of the US. NAFTA’s savaging of the Mexican agricultural sector and massive bankruptcies of small producers led directly to the flood of desperate Mexican migrants looking for work in the US.
The Georgetown-Harvard-Oxford trained ‘Bill’ Clinton was the grand wizard of talking like a ‘black preacher’ in southern churches while smoothly pursuing the ‘big bucks’ on Wall Street.
After Clinton, regressive policies increased sharply: President George W Bush (Jr), ‘First Black President’ Barack Obama and ‘First Billionaire President’ Donald Trump all supported the most virulent imperial war policies.
The two terms of President George (Jr) Bush (2001 – 2008) saw unending multi-trillion dollar wars in Afghanistan and Iraq, which have destabilized two continents. Junior Bush presided over the biggest financial crisis since the Great Depression. His anti-Muslim ‘global wars on terror (GWOT)’ was launched under the influence of ‘Israel-First’ militarists who had inundated the Defense Department, National Security staff and Middle East policy and advisory staff in the State Department. Meanwhile, GW Bush deepened unemployment and allowed the mortgage foreclosure on millions of homeowners. The domestic economy was in severe crisis.
By the end of the George W. Bush Presidency, reinvigorated anti-war and social justice movements were gaining strength throughout the country. Arriving on the scene of growing social unrest and with perfect timing, the ‘community organizer’ presidential candidate Barack Obama won the presidency by promising a progressive agenda to undermine the mass popular radicalization against Bush’s unpopular wars, growing inequalities, endless bank swindles, foreclosures and blatant racist policies against Afro-Americans and Hispanics.
Once elected, the ‘First Black’ US President Obama immediately increased Bush’s militarism and handed the criminals on Wall Street a record two-trillion-dollar bailout, ripped out of what remained of public social programs. Elected on a pledge to overhaul the ridiculously inefficient, pro-profit, private health care system, Obama gave the electorate a program of greater complexity and rapidly increasing insurance premiums (‘Obama Care’ or the ‘Affordable Care Act’), which ended with a negative impact on the nation’s health.
Under Obama, life expectancy, as well as, the income gaps between the rich and the poor grew at an alarming rate. Inequalities increased with a historic shift of national wealth to the top 1%. The class and health apartheid sharpened in the US. The transfer of jobs abroad accelerated. Multinational corporate tax evasion rose by hundreds of billions of dollars. The gap between African-American wages and white workers increased. Obama deported more immigrants, especially workers from Mexico and Central America, than all four previous presidents combined!
Elected on a pledge to ‘bring the troops home’, President Obama broke the record for waging simultaneous wars of all previous presidents! Obama launched or backed US wars and coups (‘regime changes’) in Ukraine, Iraq, Afghanistan, Libya, Syria, Yemen, Honduras and Somalia. After receiving the Nobel ‘Peace’ Prize, President Obama provided advanced weapons to Israel, Saudi Arabia, the United Arab Emirates, Jordan and Egypt. Obama financed and armed tens of thousands of mercenary terrorists who savaged the secular multiethnic Syrian republic. Furthermore, his administration cynically backed the separatist Kurds occupying Northern Iraq.
Hawaii born and bred, Harvard-educated President Obama had mastered the deep-voiced Southern preacher rhetoric to corrupt the leadership of the social justice and anti-war movements. He coopted the leaders of the mass popular movements to their eternal shame and the movements died. Even the short-lived anti-Wall Street ‘Occupy Movement’ received Obama’s expressions of ‘sympathy’ as he backed the unleashing of police dogs and tear gas on the activists!
Obama’s reactionary military encirclement of Russia and China influenced the foreign policy views of a majority of US liberals as well as the mass media — turning them into ‘humanitarian interventionists’ and tools for empire.
Ever duplicitous, Obama signed a ‘unilateral nuclear disarmament agreement with Iran’ and then immediately broke the agreement by imposing new sanctions on Tehran’s banking and oil transactions.
There was great media fanfare when Obama re-established diplomatic relations with Cuba. This move facilitated the entry and funding of pro-imperialist NGO’s committed to ‘regime change’ along the same line as other ‘color revolutions’. Despite the photo-ops with the Cuban leadership, the US trade embargo against the Cuban people remained in place.
Obama’s State Department and Treasury were tasked with sabotaging and overthrowing the elected Chavez-Maduro governments in Venezuela promoting acts of violence, which have thrown the country into chaos. His Secretary of State Clinton orchestrated the violent removal of the presidents of Libya and Honduras and the installation of rabidly reactionary governments whose policies have created hundreds of thousands of refugees and the assassinations of tens of thousands of citizens, human rights and environmental activists.
Obama’s much-promoted corporate for-profit health program brought some degree of insurance coverage to just half of the uninsured poor within its first year. However, after the first year health premiums rose by 25% while deductibles increased beyond the capacity of many working families. Since then, premiums have risen astronomically and coverage is unaffordable or unavailable in many areas of the country. The debt burden of ill health or a sudden medical emergency has increased for the middle and working class under Wall Street’s ‘First Black’ President. No demographic measures of improvement, in terms of life expectancy or life quality, have been documented since the implementation of ‘Obama Care’. Indeed, these public health measures have deteriorated with an epidemic of suicides, opioid-related deaths and premature deaths of all types among the working and rural classes.
After 8 years, the core of the nation, the so-called ‘Flyover States’, where the downwardly mobile working and lower middle class white majority live, was fed up with Obama’s cant and blatantly elitist policies. In was in this context that the distasteful billionaire buffoon Donald Trump capitalized on mass popular discontent and rallied a populace in revolt against the previous ‘war and bankers’ presidents, by promising to end corporate export of jobs, Wall Street corruption, ‘Obama Care’, competition for jobs with undocumented cheap labor and endless overseas wars. Trump hit a raw nerve among scores of millions of voters when he accused the earlier Bush Administration of fabricating the pretexts for the invasion of Iraq as well as for security failures in the 9/11 attacks on New York City and the Pentagon.
Within weeks after taking office President Trump gracefully performed an Obama-style ‘about-face’ and emerged a re-anointed warmonger of the Hillary Clinton variety: He celebrated his transformation by bombing Syria, Afghanistan and the defenseless, starving people of Yemen. He sent warships off the coast of North Korea, placed advanced missile installations in South Korea and threatened nuclear war in Asia.
Trump miserably failed to ‘reform’ the corporate health plan concocted by his smirking predecessor. He shed his promise to seek peaceful relations with Moscow and embraced the policies of the worst anti-Russian liberal warmongers groomed by Clinton and Obama. Obama’s overt war posturing had so deeply influenced African-American politicians that they loudly accused Trump of being ‘too soft on Russia’! Former civil rights leaders-turned politicians were calling for greater US military interventions — a spectacle what would have made our sacred civil rights martyrs rolling in their graves.
Trump, building on the immense power already entrenched in Washington, reinforced and expanded the role of finance capital and the Pentagon in determining US policy. Trump pledged to exceed Obama’s arrest and expulsion of immigrants — from 2.5 million workers in eight years to an additional 5 million in his first four-year term.
The US corporate mass media and the liberal left have been pushing the pro-business President Trump even further to the right — demanding the US escalate its nuclear threat against North Korea, mount a full invasion of Syria (for its ‘crimes against humanity’) and, above all, ‘tighten the military noose’ around Russia and China.
By any measure, the policies of President Richard Milhous Nixon were more socially progressive, less militarist and less servile to Wall Street than any and all of the subsequent US Presidents. This assessment is heresy to the current historical narratives promoted by both political parties and the corporate media-academic nexus.
But even during the Nixon Presidency there were already signs of an allied liberal-rightist attack on his progressive ‘conservative’ agenda. Senator Edward (Ted) Kennedy blocked Nixon’s proposal for a universal national health system built on an expansion of the highly successful ‘Medicare Program’. Nixon’s proposal (a ‘Medicare For All’) would have been far more comprehensive, effective and affordable than the corporate boondoggles cooked up by the Clinton and Obama Administrations.
What accounts for the dramatic shift from the center left to the far right among US Presidents after the 1970’s? What explains the rise and demise of ‘Nixonian’ progressivism and the great leap backward in the subsequent four and half decades?
Personality and personal background are not irrelevant: Nixon’s class and work background and personal experience with the Great Depression framed some of his outlook despite his ‘conservative’ credentials. However, the social and political balance of forces played the decisive role. Richard Nixon came to national attention as a rightwing militarist and aggressive attack dog for Senator Joesph McCarthy during the 1950s and at the beginning of his Presidential term in the late 1960’s. However, the reality of the multi-million-person anti-war movement challenged American society and influenced the armed forces from within. Even sectors of the mass media became highly critical of the permanent war state. This movement filled the streets, divided families and influenced the institutions and communities leading to a dramatic change in Nixon’s politics toward peace and even toward social and racial justice. Nixon truly became a ‘realist’.
In those days, the industrial trade unions were powerful. Manufacturing formed the basis of the economy and determined the direction of the banking-finance sector. Wall Street played ‘second fiddle’ to production.
Fed up with the lack of social progress and opportunity in their communities, African American revolts in the streets were far more effective than the tame black Democratic Party politicos in Congress.
The decline of the social movements and militant labor unions, as well as the retreat to electoral politics among the African American and anti-war movements, ended the independent popular pressure and facilitated the rising power of the pro-war, Wall Street-controlled parties linked to money and speculation. Labor unions became the fiefdoms of corrupt millionaire union bosses who bought protection from prosecution with multi-million dollar campaign donations to both Democrats and Republican politicians. They discarded the Nixon’s social agenda, using the ‘Watergate Scandal’ as a pretext to dismantle his advanced programs.
Presidents and Congresses became beholden to the bankers. The rise, dominance and deep corruption of the Wall Street speculators realigned the economy away from domestic manufacturing to international finance — leading to the great relocation of US factories abroad and the permanent marginalization of the once-organized American working class.
Voters were marginalized as active participants in their own public affairs. They alternated their disaffection between parties and candidates, between big and small spenders, indicted and unindicted swindlers, and exposed and unpunished perverts.
The domestic changes in the economy and social structure were the direct outcome of these shifts in the social and political struggles and organizations.
There is a dialectical relationship between socio-economic changes and the rise and fall of socio-political struggles.
These domestic shifts of power and policy were influenced by the major changes in global power, namely the demise of the USSR, the decline of secular-nationalist regimes in the Middle East, the defeat of the left in Latin America and, above all, the rise of the US imperial doctrines of unipolar power and the globalization. The ‘changing times’ explains everything and nothing! While the objective world determines politics, so do the subjective responses of Presidents.
President Richard Nixon could have escalated the Vietnam War up to a nuclear attack on Hanoi: This is what the current Obama-Trump militarist advisors now recommend for the North Koreans. Nixon could have followed the rightwing ‘free market’ ideology of the Republican-Goldwater faction. However, Nixon took a pragmatic, peace and social reformist position — which have brought us some of our most cherished programs — EPA, OSHA, SALT disarmament, relations with China, even Roe versus Wade, and an end to the military draft.
Subsequent Presidents, faced with the shifts in political, social and economic power, chose to re-direct the nation toward greater militarism and the domination of finance capital. They have systematically attacked and dismantled the social welfare programs, environmental protection, pro-industry legislation, diplomacy and peace pacts initiated by Nixon.
The aphorism, ‘man makes history but not of his own doing’, is central to our discussion of the Nixon legacy. The process of regression is a cumulative process, of leaps and steps. In recent years, regression has accelerated with devastating results for the domestic and world populations. Social power, concentrated at the top, weakens but also alienates power at the bottom and middle. The current configuration of power and policies cannot be permanent, even if the trajectory so far has favored the elite. Social classes and groups are not fixed in their orientations.
Twice in recent years, significant majorities voted for jobs, justice and peace (Obama and Trump) and instead got charlatans bringing greater inequality, injustice and endless wars.
Deception and deep commitments to reactionary politics have penetrated widely among the ‘discontented classes’. African-American political leaders and pundits now demand war against Russia following the pronouncements of their ‘Black President’, Barack Obama. Poor marginalized white workers still support their billionaire leader Donald Trump as he waltzes down Wall Street and into possible nuclear war.
The dialectic of discontent and resentment can lead to progressive or reactionary political and social alignments, even, or especially, in the face of history’s great leap backwards!
While the Right faithfully supports the policies and interests of its ruling class supporters, the Left has systematically betrayed their political platform promises and deceived its working class, salaried employees, small business and regional supporters.
Historic reversals have happened in rapid succession by Leftist leaders, including greater oligarch control over the economy, more dictatorial political domination by imperial powers (US,EU), increasing inequalities and poverty, and ‘Leftist’ support for imperial wars.
In some cases leftist leaders have gone beyond their rightist opponents by passing even more extreme reactionary policies upon assuming power.
In this essay, we will identify some of the turncoat leftists: The ‘Champions of Betrayal’.
Secondly we will review their policy reversals and the consequences for their working class and rural supporters.
Thirdly, we will present a case study of the world’s worst ‘Left’ traitor today: Alexis Tsipras, Prime Minister of Greece.
In the final section, we will discuss some of the possible explanations for the trend of political reversals by left leaders.
Turncoat ‘Leftists’ of the Early 21st Century
There are numerous examples of former guerrilla movements, leftist regimes and political leaders who gained mass popular support on the promise of radical structural transformations and who turn around to embrace the interests of their oligarchical and imperial adversaries.
An entire generation of radicals from the 1960’s and ‘70’s started on the left and, by the ‘80’s and 90’s ended up in ‘centrist’ and rightwing regimes – even becoming collaborators with the extreme right and the CIA.
Former guerrilla fighters, who turned centrist and rightwing, became Cabinet Ministers or Presidents in Uruguay, Brazil, Peru, Ecuador and Chile.
El Salvadoran guerrilla commander, Joaquin Villalobos, later collaborated with the CIA and provided ‘advice’ to the ‘death squad’ President of Colombia.
The list of late 20th century traitors is long and dismal. Their policy betrayals have caused great hardship for their mass supporters who suffered socio-economic losses, political repression, arrests, torture, death and a profound distrust toward ‘left’ intellectuals, political leaders and their ‘promises’.
The 21st Century: Starting on the Left and Ending on the Right
The first decade of the 21st century witnessed a revival of left regimes and political parties in Europe and Latin America.
The Revolutionary Armed Forces of Colombia (FARC), led by the great peasant leader Manual Marulanda, had 20,000 fighters and millions of supporters. In 1999, it had advanced to the outskirts of the Capital, Bogota. The reality today is a dramatic reversal.
In France, the Socialist Party adopted a left program and elected Francois Hollande as President in 2012. He promised to raise taxes on the rich to 75% in order to finance a massive jobs program. He promised to extend progressive labor legislation and to defend national industries. Today his credibility is near zero.
Throughout Latin America, Leftists were elected to head governments, including Brazil, Argentina, Peru, Uruguay, Bolivia, Venezuela, Ecuador and El Salvador. With the possible exception of Bolivia and Ecuador, they have been ousted by their rightwing partners or opponents.
In Spain, Portugal and Greece, new radical leftist parties emerged with promises to end the brutal European Union-imposed austerity programs, and launch profound, class-based, structural transformations. Here history is repeating itself with another series of betrayals.
The Revolutionary Armed of Forces of Colombia (FARC): From Revolution to Surrender
By June 2017, the FARC leadership had disarmed its fighters, abandoning millions of peasant supporters in regions formerly under their control. The FARC’s signing of the Peace Pact with the Santos regime led to neither peace nor a real pact. Dozens of activists are already being murdered and hundreds of leftists and peasants are fleeing for their lives from death squads connected to the Santos regime. Assassinations occurred throughout the negotiation process and afterwards. Guerrilla fighters, who turned in their arms, now face kangaroo trials, while peasants who apply for agrarian reform are driven from their farms. Rank and file FARC fighters and militants are abandoned with their families in the jungle without homes, jobs and security from the death squads. US military bases and advisers remain. The entire socio-economic system is unchanged. Only the Cuba-based guerrilla ‘leaders’ are guaranteed security, two comfortable seats in Parliament — which has been denied — and the praise of the US government!
FARC leaders and chief negotiators, Ivan Marquez and Timoleon Jimenez, are clear contenders for the ‘Traitor of the Year Award’.
France’s President Hollande: An Imperial Collaborator Flushed down the Toilet
President Francois Hollande’s tenure was not far behind the FARC’s betrayal. Elected President of France in 2012 under the Socialist Party, he promised to ‘tax the rich’ by 75%, extend and deepen workers’ rights, reduce unemployment, revive bankrupt industries, prevent capitalist flight and end France’s military intervention in Third World countries.
After a brief flirtation with his campaign rhetoric, President Hollande went on a pro-business and militarist rampage against his voters:
First, he deregulated business relations with labor, making it easier and quicker to fire workers.
Second, he reduced business taxes by $40 billion Euros.
Third, he imposed and then extended a draconian state of emergency following a terrorist incident. This included the banning of strikes by workers protesting his anti-labor legislation and the double-digit unemployment rate.
Fourth, Hollande launched or promoted a series of imperial wars in the Middle East and North and Central Africa.
France under Francois Hollande initiated the NATO bombing of Libya, the murder of President Gadhafi, the total destruction of that nation and the uprooting of millions of Libyans and sub-Saharan African workers. This led to a massive flood of terrified refugees across the Mediterranean and into Europe with tens of thousands drowning in the process.
President Holland’s neo-colonial project oversaw the expansion of French troops into Mali (destabilized by the destruction of Libya) and the Central African Republic.
A clear promoter of genocide, Hollande sold arms and sent ‘advisers’ to support Saudi Arabia’s grotesque war against impoverished Yemen.
President Hollande joined the US mercenary invasion of Syria, allowing some of France’s finest nascent jihadis to join in the slaughter. His colonial ambitions have resulted in the flight of millions of refugees into Europe and other regions.
By the end of his term of office in 2017, Holland’s popularity had declined to 4%, the lowest level of electoral approval of any President in French history! The only rational move he undertook in his entire regime was to not seek re-election.
Greek Prime Minister Alexis Tsipras: ‘Traitor of the Year’
Despite the stiff competition from other infamous leftist traitors around the world, Greek Prime Minister Alexis Tsipras wins the ‘Global Traitor of the Year’ award.
Tsipras deserves the label of ‘Global Traitor’ because:
1) He made the quickest and most brutal turn from left to right than any of his venal competitors.
2) He supported Greece’s subjugation to the dictates of the Brussels oligarchs privatization demands, agreeing to sell its entire national patrimony, including its infrastructure, islands, mines, beaches, museums, ports and transports etc.
3) He decreed the sharpest reduction of pensions, salaries and minimum wages in European history, while drastically increasing the cost of health care, hospitalization and drugs. He increased VAT, (consumer taxes) and tax on island imports and farm income while ‘looking the other way’ with rich tax evaders.
4) Tsipras is the only elected leader to convoke a referendum on harsh EU conditions, receive a massive mandate to reject the EU plan and then turn around and betray the Greek voters in less than a week. He even accepted more severe conditions than the original EU demands!
5) Tsipras reversed his promises to oppose EU sanctions against Russia and withdrew Greece’s historic support for the Palestinians. He signed a billion-dollar oil and gas deal with Israel which grabbed oil fields off the Gaza and Lebanon coast. Tsipras refused to oppose the US – EU bombing of Syria, and Libya — both former allies of Greece.
Tsipras, as the leader of the supposedly ‘radical left’ SYRIZA Party, leaped from left to right in the wink of an eye.
The first and most revealing indication of his turn to the right was Tsipras’ support for Greece’s continued membership in the European Union (EU) and NATO during the formation of SYRIZA (2004).
SYRIZA’s ‘left’ mouthed the usual platitudes accompanying EU membership, raising vacuous ‘questions’ and ‘challenges’ while talking of ‘struggles’. None of these ‘half pregnant’ phrases made sense to any observer who understood the power of the German-led oligarchs in Brussels and their strict adherence to ruling-class imposed austerity.
Secondly, SYRIZA had played a minor role, a best, in the numerous trade union general strikes and worker and student led direct action in the run-up to its electoral victory in 2015.
SYRIZA is an electoral party of the lower middle and middle class, led by upwardly mobile politicos who had few if any ties to shop-floor factory and agrarian struggles. Their biggest struggles seemed to revolve around internal factional wars over seats in Parliament!
SYRIZA was a loose collection of squabbling groups and factions, including, ‘ecology movements’, Marxist sects and traditional politicos who had floated over from the moribund, and corrupt PanHellenic Socialist Party (PASOK). SYRIZA expanded as a party at the beginning of the 2008 financial crisis when the Greek economy collapsed. From 2004 to 2007 SYRIZA increased its presence in Parliament from 3.5% to only 5%. Its lack of participation in the mass struggles and its internal squabbles led to a decline in the 2009 legislative elections to 4.6% of seats.
Tsipras ensured that SYRIZA would remain in the EU, even as its self-styled ‘left wing’, the Left Platform, led by ‘Marxist academic’ Panagiotis Lafazanis, promised to “keep an open door to leaving the EU”. Alexis Tsipras was first elected to the Athens city council, where he publicly attacked corrupt and demagogic rightwing colleagues while taking private lessons in power from the oligarchy.
In 2010, the rightwing PASOK and far right New Democracy agreed to an EU dictated debt bail-out leading to massive job losses and the slashing of wages and pensions. SYRIZA, while outside of power, denounced the austerity program and gave lip-service to the massive protests. This posturing allowed SYRIZA to quadruple its representation in parliament to 16% in the 2012 election.
Tsipras welcomed corrupt ex-PASOK members and financial advisers into SYRIZA, including Yanis Varoufakis, who spent more time motorcycling to upscale bars then supporting the unemployed workers in the streets.
EU ‘memorandums’ dictated the privatization of the economy, as well as deeper cuts in education and health. These measures were implemented in shock waves from 2010 through 2013. As an opposition party, SYRIZA increased its seats 27% in 2013 … a scant 3% behind the ruling rightwing New Democracy. In September 2014, SYRIZA approved the Thessalonika Program promising to reverse austerity, rebuild and extend the welfare state, restart the economy, defend public enterprises, promote tax justice, uphold democracy (direct democracy no less!) and implement a ‘national plan’ to increase employment.
The entire debate and all the resolutions turned out to be a theatrical farce! Once in power, Tsipras never implemented a single reform promised in the Program. To consolidate his power as head of SYRIZA, Tsipras dissolved all factions and tendencies in the name of a ‘unified party’ — hardly a step toward greater democracy!
Under ‘Dear Uncle Alexis’ control, SYRIZA became an authoritarian electoral machine despite its left posturing. Tsipras insisted that Greece would remain within the EU and approved a ‘balanced budget’ contradicting all his phony campaign promises of public investments to ‘extend the welfare state’!
A new EU bailout was followed by a jump in unemployment to over 50% among youth and 30% of the entire labor force. SYRIZA won the January 25, 2015 parliamentary elections with 36.3% of the electorate. Lacking a single vote to secure a majority in parliament, SYRIZA formed an alliance with the far-right ANEL party, to which Tsipras gave the Defense Ministry.
Immediately upon taking office, Prime Minister, Alexis Tsipras announced his plans to renegotiate Greece’s bailout and ‘austerity program’ with the EU oligarchy and the IMF. This phony posturing could not hide his impotence: Since SYRIZA was committed to staying in the EU, austerity would continue and another onerous ‘bailout’ would follow. During ‘internal meetings’, members of SYRIZA’s ‘Left Platform’ in the Cabinet called for leaving the EU, reneging the debt and forging closer ties with Russia. Despite being totally ignored and isolated, they stayed on as impotent ‘token leftist’ Cabinet Ministers.
With Tsipras now free to impose neo-liberal market policies, billions of Euros flowed out of Greece and its own banks and businesses remained in crisis. Both Tsipras and the ‘Left Platform’ refused to mobilize SYRIZA’s mass base, which had voted for action and demanded an end to austerity. The media’s gadfly, Finance Minister Varoufakis, put on a sideshow with grand theatrical gestures of disapproval. These were openly dismissed by the EU-IMF oligarchy as the antics of an impotent Mediterranean clown.
Superficial as ever, the Canadian, US, European left-wing academics were largely unaware of SYRIZA’s political history, its opportunist composition, electoral demagogy and total absence from real class struggle. They continued to blather about SYRIZA as Greece’s ‘radical left’ government and attended its PR functions. When SYRIZA flagrantly embraced the EU’s most savage cutbacks against Greek workers and their living standards affecting everyday life, the highly paid, distinguished professors finally spoke of SYRIZA’s ‘mistakes’ and ladled the ‘radical left’ from this stew of opportunists! Their grand speaking tours to Greece were over and they flitted off to support other ‘struggles’.
As the summer of 2015 approached, Prime Minister Tsipras moved ever closer to the entire EU austerity agenda. ‘Dear Alexis’ dumped Finance Minister Varoufakis, whose histrionics had irked Germany’s Finance Minister. Euclid Tsakalotos , another ‘radical’ leftist, took over as Finance Minister, but turned out to be a malleable lieutenant for Tsipras, willing to implement any and all EU-imposed austerity measures without the antics.
By July 2015, Tsipras and SYRIZA accepted a harsh austerity program dictated by the EU. This rejected SYRIZA’s entire Thessalonika Program proclaimed a year earlier. The entire population, and SYRIZA’s rank and file members grew angrier, demanding an end to austerity. While approving a ‘belt tightening’ austerity program for his electoral mass base throughout the summer of 2015, Tsipras and his family lived in luxury in a villa generously loaned by a Greek plutocrat, far from the soup lines and hovels of the unemployed and destitute.
Prime Minister Alexis Tsipras implemented policies earning him the ‘Traitor of the Year Award’. His was a duplicitous strategy: On July 5, 2015, he convoked a referendum on whether to accept the EU’s bailout conditions. Thinking his ‘pro-EU’ supporters would vote ‘Yes’, he intended to use the referendum as a mandate to impose new austerity measures. Tsipras misjudged the people: Their vote was an overwhelming repudiation of the harsh austerity program dictated by the oligarchs in Brussels.
Over 61% of the Greek people voted ‘no’ while merely 38% voted in favor of the bailout conditions. This was not limited to Athens: A majority in every region of the country rejected the EU dictates — an unprecedented outcome! Over 3.56 million Greeks demanded an end to austerity. Tsipras was ‘admittedly surprised’ . . . and disappointed! He secretly and stupidly thought the referendum would give him a free hand to impose austerity. He put on his usual grin as the voting results were announced.
Less than a week later, on July 13, Tsipras renounced the results of his own referendum and announced his government’s support for the EU bailout. Perhaps to punish the Greek voters, Tsipras backed an even harsher austerity scheme than the one rejected in his referendum! He drastically slashed public pensions, imposed massive regressive tax hikes and cut public services by $12 billion euros. Tsipras agreed to the infamous ‘Judas memorandum’ of July 2015, which increased the regressive general consumer tax (VAT) to 23%, a 13% food tax, a sharp increase in medical and pharmaceutical costs and tuition fees, and postponed the retirement age by five years to 67.
Tsipras continued on his ‘historic’ rampage over the suffering Greek people throughout 2016 and 2017. His regime privatized over 71,500 public properties, including the historic patrimony. Only the Acropolis was spared the auction block … for now! The resulting unemployment drove over 300,000 skilled and educated Greeks to migrate. Pensions slashed to 400 Euros led to malnutrition and a three-fold rise in suicides.
Despite these grotesque social consequences the German bankers and the regime of Angela Merkel refused to reduce the debt payments. Prime Minister Tsipras’ groveling had no effect.
Sharp tax hikes on farm fuels and transport to tourist islands led to constant marches and strikes in cities, factories, fields and highways.
By January 2017 Tsipras had lost half of his electorate. He responded with repression: gassing and beating elderly Greeks protesting their poverty pensions. Three-dozen trade unionists, already acquitted by the courts, were re-tried by Tsipras’ prosecutors in a vicious ‘show trial’. Tsipras supported the US-NATO attacks on Syria, the sanctions against Russia and the billion-dollar energy and military agreements with Israel.
Short of the Nazi occupation (1941-44) and Anglo-Greek civil war of (1945-49), the Greek people had not experienced such a precipitous decline of their living standards since the Ottomans. This catastrophe occurred under the Tsipras regime, vassal to the Brussels oligarchy.
European, Canadian and US leftist academic tourists had ‘advised’ SYRIZA to remain in the EU. When the disastrous consequences of their ‘policy advice’ became clear … they merely turned to advising other ‘struggles’ with their phony ‘socialist forums’.
The betrayals by ‘Leftist’ and ‘radical leftist’ leaders are partly due to their common practices as politicians making pragmatic deals in parliament. In other cases, former extra-parliamentary and guerrilla leaders were faced with isolation and pressure from neighboring ‘left’ regimes to submit to imperial ‘peace accords’, as in the case of the FARC. Confronting the massive build-up of the US supplied and advised armies of the oligarchs, they folded and betrayed their mass supporters.
The electoral framework within the EU encouraged leftist collaboration with class enemies – especially German bankers, NATO powers, the US military and the IMF.
From its origins SYRIZA refused to break with the EU and its authoritarian structure. From its first day of government, it accepted even the most demonstrably illegal private and public debts accumulated by the corrupt right-wing PASOK and New Democracy regimes. As a result SYRIZA was reduced to begging.
Early on SYRIZA could have declared its independence, saved its public resources, rejected its predecessors’ illegal debts, invested its savings in new jobs programs, redefined its trade relations, established a national currency and devalued the drachma to make Greece more flexible and competitive. In order to break the chains of vassalage and foreign oligarch imposed austerity, Greece would need to exit the EU, renounce its debt and launch a productive socialist economy based on self-managed co-operatives.
Despite his electoral mandate, the Greek Prime Minister Tsipras followed the destructive path of Soviet leader Michel Gorbachev, betraying his people in order to continue down the blind ally of submission and decay.
While several leaders offer stiff competition for the ‘Traitor of the Year Award’, Alexis Tsipras’ betrayal has been longer, more profound and continues to this day. He broke more promises and reversed more popular mandates (elections and referendums) more quickly than any other traitor. Moreover nothing short of a generation will allow the Greeks to recover left politics. The left has been devastated by the monstrous lies and complicity of Tsipras’ former ‘left critics’.
Greece’s accumulated debt obligations will require at least a century to play out — if the country can even survive. Without question, Alexis Tsipras is the ‘Traitor of the Year’ by unanimous vote!!!
Originally published at MintPressNews:
Britain’s departure from the EU, a process that will take about two years, has formally gone into motion. MintPress News had the opportunity to speak with prize-winning economist Roger Bootle about what Brexit will ultimately mean for the country’s economy, as well as the European Union as a whole.
LONDON– The recent triggering of Article 50 of the European Union’s Lisbon Treaty by the United Kingdom has formally set into motion the process of Britain’s departure from the EU, an action that is in line with the result of last June’s referendum, where 52 percent of British voters chose to leave the union.
Europe is now faced with the prospect of a turbulent period ahead, with the upcoming French presidential elections and the possibility of a victory for populist candidate Marine Le Pen, as well as snap parliamentary elections declared in the UK, German elections in September, a rising tide of Euroscepticism across the continent and the process of Brexit now formally put into motion.
Economist Roger Bootle, chairman of Capital Economics in London and specialist adviser to the British House of Commons Treasury Committee, is the lead author of the report “Leaving the euro: a practical guide,” which was awarded the prestigious Wolfson Prize in Economics in 2012. The report presents a comprehensive proposal for how any eurozone member could depart the zone in an orderly fashion. Bootle discussed his findings extensively in a March 2015 interview with Dialogos Radio.
MintPress News recently had the opportunity to speak with Bootle, in an interview that also aired on Dialogos Radio, about the prospects of the British economy following Brexit and the future of the EU and eurozone following Britain’s upcoming departure.
MintPress News (MPN): The British government has recently gone ahead and invoked Article 50, formally triggering the process for Great Britain’s departure from the European Union. Many doom-and-gloom scenarios have been voiced, particularly by media pundits, regarding the adverse impacts of “Brexit” on Great Britain’s economy. In reality, how has the British economy performed since the referendum vote and, more recently, since Article 50 was invoked, and what are its prospects going forward?
Roger Bootle (RB): The British economy has done extremely well since the referendum. In fact, you can’t really see any adverse effects at all. It’s just bowled along much as before. In the immediate weeks and months after the referendum, there was some hesitation and some business sectors undoubtedly felt a bit of a slowdown, but that didn’t last long.
As things are at the moment, they’re looking really very strong. Surveys suggest that economic growth will continue roughly at the level we’ve seen recently. Of course, the pound has dropped quite considerably, and that’s helped British exports. They are looking very strong. Even if there’s a bit of a squeeze on consumers, which there may well be, I think all the signs are that the British economy is going to sail through this period.
MPN: From an economic point of view, what are the next steps in the Brexit process for Great Britain? For instance, do you believe that Great Britain will still maintain access to the European common market, and more so, do you believe that Great Britain should maintain access to the European common market?
RB: Now of course we are in a difficult phase, which could go on for up to two years because the Lisbon Treaty allows for a period of up to two years for negotiations for a country leaving. Of course, there’s been no country apart from Greenland, a long time before, that’s actually left the European Union, so we’re in uncharted territory really.
I think that what we’re going to see, what I hope we’re going to see, is some sort of free trade deal hammered out between Britain and the EU. Now if that doesn’t happen, it’s very important that this word “access” is nobbled, that Britain needs “access.” I think it really is very misleading, this word.
Every country in the world has got access to the single market – the United States, India, China, Japan, all these countries trade with the single market, they’ve got access to it, it’s just that not being part of the single market, not having a free trade deal with the European Union, they have to pay the
European Union common external tariff, and of course they have to meet all the standards and certificates and so on that the EU demands.
Now, if Britain doesn’t reach some sort of free trade agreement with the EU during this two-year negotiating period, then we’re effectively going to be in the same sort of situation that the United States, China, Japan and India are all in. That doesn’t sound to me to be too bad.
MPN: There have been many rumors and many press reports regarding the pound of flesh, if you will, that the European Union will demand from Great Britain as an exit bill for leaving the EU. Do you view this as a distinct possibility, or does Great Britain have bargaining chips of its own to possibly avoid this as it navigates the exit process?
RB: Various figures have suggested bills as high as 60 billion euros that the UK will have to hand over to the EU. I think the chances of the EU being able to secure anything like that are vanishingly small, next to zero. There was a report by the British House of Lords recently which obtained expert legal opinion, and the result of that expert legal opinion was that Britain was obliged to pay nothing at all. That is to say, the common sense interpretation of this would apply, that once you leave the club you’re no longer asked to carry on paying your membership dues.
Now, I suspect that there might be reasons of political and economic self-interest such that Britain might end up paying rather more than zero, but 60 billion euros, well they’ll have to whistle for that. I think there’s plenty of room for some sort of reasonable deal.
MPN: Part of the exit process, from what I understand, would have to do with Great Britain’s share of the European Central Bank’s cash reserves, which amount to 16 percent of the ECB’s total cash reserves. Can these cash reserves be returned to Great Britain as part of the Brexit process?
RB: I don’t see that as being a factor to be taken on its own. As a shareholder in the ECB, we do have a claim on the ECB’s net assets. The ECB’s got liabilities as well, so it isn’t reasonable to just look at the cash the ECB holds, you have to look at the balance sheet as a whole, and then you’ve got to put that into the context of the whole position of the EU. I can’t see the UK walking away with 16 percent of the ECB’s cash holdings. I think there’s going to be some overall totting-up of assets and liabilities and whatever the EU thinks are the UK’s continuing obligations after it’s actually left the club, and that’s something that’s going to be a major argument. These ECB cash reserves will be just one factor among very many that will affect this question of how much the UK has to hand over.
MPN: What are the possibilities that Great Britain has on the table as it prepares to depart the European Union, in terms of new trade deals or other beneficial agreements outside of the European Union?
RB: We’ve heard President [Donald] Trump say that he’s keen on a prospective U.S.-UK trade deal, and he’s made it pretty clear that he thinks that can be accomplished very quickly. There’s a whole series of other countries that are interested, including former members of the British Empire that are now members of the British Commonwealth: Canada, Australia, New Zealand, India. Countries outside, such as Japan and China, I think will be able to secure some sort of agreement pretty soon.
I think it’s very important not to overplay the significance of trade deals. Britain trades all around the world with all sorts of countries with which it does not have a trade deal, the United States being one of them, Britain’s biggest single export market. The UK does not have a trade agreement with the United States, and the reason it doesn’t have one is because at the moment it can’t make its own trade policy! It’s the EU that has to do that, and the EU hasn’t been able to make a trade deal with the United States!
I think very much [that as] a result of “euro-brainwashing,” in the European Union most people seem to think that prosperity emerges at the end of the fountain pens of these wonderful official trade negotiators in Brussels and elsewhere, and that all our futures depend on these people. This is complete hogwash. It’s a fairy tale. Around the world, all sorts of countries do extremely well and trade with each other without having anything to do with these panjandrums in Brussels. Britain could be in exactly the same position.
MPN: How does the City of London and the business community in Great Britain view the prospects of the British economy following Brexit?
RB: In the run-up to the referendum, there was a majority of the leaders of big business in Britain, including in the City of London, the financial interests, in favor of Britain staying in. That hasn’t changed very much, and accordingly there’s a preponderance of voices, although it’s less strident than before, worried about exactly what sort of arrangement Britain is going to put in place.
But even before the referendum vote, this description of the state of business opinion was far from uniform. There were a lot of businesspeople who were in favor of Britain leaving. A lot of people in the City were in favor of Britain leaving. On the whole, it was the more entrepreneurial City firms that were in favor of Britain leaving, as opposed to the big established banks and brokerage houses and so forth, who on balance were in favor of Britain staying.
I think that now the debate has moved on a lot. It’s been helped by some of Mrs. [British Prime Minister Theresa] May’s speeches and by the triggering of Article 50. It’s now pretty clear that we are leaving; accordingly, business opinion has switched from trying to operate as some sort of rear-guard action to realizing that it’s going to happen. Obviously, there’s a difference of opinion.
There are still some business leaders, including some in the City, who are a bit concerned and they want to make sure that we get the softest of soft Brexits. But a lot of business leaders are more optimistic than that. I think the mood, though, has changed. It’s changed towards, as I thought it would and hoped it would, towards making the most of Brexit, getting on with it, getting on with the job, getting the job of leaving the EU done and then making sure that Britain is best placed in the world that follows.
MPN: A recent survey of reserve managers at 80 central banks around the world found that there is a recent tendency for central banks to cut their euro exposure, while viewing British currency as a safer prospect for their banks’ portfolios. Is this a trend that you have observed in the markets and is this likely to continue?
RB: I don’t find it surprising that central bank reserve managers should find the prospect of having substantial amounts of their reserves in euros alarming. I don’t find that surprising at all, because there is a mega-crisis in the European Union. For the last year or so, the media has been obsessing about the so-called “British crisis” triggered by the fact that we voted to leave the European Union.
But fundamentally, putting aside for a moment the possible question of a second Scottish referendum — that is a big worry for the UK — that aside, the UK is a pretty stable place, and I think all the signs are that although there might be a few wobbles over Brexit, it can continue to be both successful and stable in the years ahead. And of course, famously it’s got extremely liquid financial markets. So I can see why international money managers, including central bank reserve managers, would find the UK fairly attractive.
By contrast, you can paint a scenario that’s deeply alarming for the countries of the EU. It’s still, I think, more than possible that another country is going to leave the euro over the next few years. The Italians remain very weak, the Greek economy is in a very, very serious state. Either one or both of those countries can leave. You’ve got a political crisis in France, with the possibility of far-right leader Marine Le Pen becoming president.
Even if that doesn’t happen, there’s no doubt over what way France is going over the next couple of years. So there are really fundamental questions about the integrity of the EU as a political unit, and the euro currency alongside that. Why would you want to expose substantial amounts of your reserves to that?
From a British point of view, there is a danger, I think, in all of this. I happen to think that the lower pound brought on by Brexit is a great boon for the British economy. I wanted the pound to be weaker for a long time. I think we needed it, it’s improved our competitiveness, so the last thing I would want to see is international capital holders becoming really worried about the euro and the EU, moving money into the pound with the result of the pound rising a lot in the exchanges. I think that would be extremely unhelpful for Britain.
MPN: Even though Great Britain was not in the eurozone, many people forget that it had been a part of the European Exchange Rate Mechanism, the ERM, before departing in 1992. This departure had, like Brexit, been accompanied by doom-and-gloom scenarios for what the impact on the British economy would be. In reality, how did exiting the ERM impact the British economy at the time?
RB: It’s very funny, this, because I remember extremely well that before Britain left — ”left” is too dignified a word, it sort of fell out of the ERM. What happened in September 1992, the UK Treasury was telling anyone who wanted to listen, and quite a few who didn’t, that we absolutely had to stay in the ERM, because otherwise inflation would soar, interest rates would soar and the economy would go down the tubes.
Various economists, myself included, said this was rubbish and that the opposite would happen, and dare I say it, after Sept. 16, 1992, the Treasury was proven wrong. That’s to say, the currency fell a long way, and exactly as a few of us had said, interest rates would not have to go up. Indeed they fell, inflation carried on falling too, and the economy recovered. After that, there were five years of very strong growth under the Conservatives before Labour won the election in 1997. So that was an earlier occasion where the Treasury forecasts of doom and gloom were proved comprehensively wrong.
MPN: Looking at economic and political developments in Europe, with an emphasis on the upcoming presidential elections in France and the candidacy of Marine Le Pen, who has delivered her own strong Eurosceptic message to French voters, do you believe we are seeing the beginning process of the breakup of the eurozone or the European Union, and how can Brexit serve as a catalyst for this process?
RB: I think we are seeing probably the beginnings of the breakup of the EU. The beginnings of the breakup of the euro were seen some time ago. Of course it hasn’t happened, but the signs are, I think, pretty clear, of the strains, very clear of course in Greece, but also I think more significantly in Italy. Less dramatic, of course, in Italy, but Italy is a much bigger economy, and I think this is more significant for the EU because Italy, of course, was a founding member of the EU. Greece didn’t join until much later.
If Greece ends up leaving the euro, then that is a hammerblow not just to the euro but, I think, to the institutions of the EU itself. Now, it may well be that one of these events, a country leaving the euro or the election of Marine Le Pen, could happen fairly soon, and that would still be early on in the Brexit process, because it will be almost two years until Britain leaves the EU.
But if Italy doesn’t leave the euro, and/or we don’t get Marine Le Pen as president of France, and both the euro and the EU hold together, then I think Brexit is going to play a major role, because then all eyes are going to be on seeing how the UK does outside the EU. Now of course, it’s going to take quite some time for this to be testable. We’ve got the up to two years of negotiations, and I suspect there will be some wobbles and difficulties and short-term problems associated with the business of exit, so it might be a year or two after exit before we can see how the UK is doing.
But if the UK is doing really pretty well after that period, we’re going to see a lot of pressure within the EU for other countries to leave, because then the UK will have gotten out of the free movement of labor, gotten out of the jurisdiction of the European courts without having to pay Brussels these huge annual subventions, and I think a lot of countries will look at this deal and think “oh gosh, I think I rather like that setup.”
MPN: A few years back, you were awarded the Wolfson Prize in Economics for your analysis that showed that any eurozone member state could safely depart the eurozone in an orderly fashion. Could you recap some of the highlights of this proposal for our listeners, and has anything changed in your analysis since then?
RB: I don’t think the essence of the situation or indeed my recommendations for what a country should do have changed at all, but there is a particular relevance to the French situation. What we said was, first of all, don’t be afraid of the fact that the exchange rate for the new currency falls, that the currency is weak immediately after the exit. That is part of the solution, not the problem. You shouldn’t try to stop it, indeed you should encourage it. It’s how you get the combination of reduced burden of debt and increased competitiveness.
We recommended that preparations for this exit should be conducted in secret. If this is not possible, then you have to impose capital controls. You might have to close the banks, which would be a serious worry. You don’t need to be able to issue new currency in order to leave. It takes quite some time for notes to be printed. You can do it without doing that in these days of electronic money. You could do without notes for a while, and indeed you could carry on using euros in the interim before your new notes are available.
You probably will need, in some sense, to default on some of your debt. The aim should be redenominate your national debt into the new currency, the one that’s depreciated, and depending on whether you can do that, it’s going to depend on the precise legal position of the debt. But insofar as you can, that’s what you should do, and the aim should be, through a combination of a reduced debt burden as a share of GDP, and the increased competitiveness, to get a period of economic growth, and from that of course, all sorts of good things will follow.
The connection with the French election is that Marine Le Pen has talked about having a referendum on ditching the euro and bringing back the franc, which is completely different from what we suggested in our Wolfson Prize-winning study. The significance of this is that Marine Le Pen’s proposal is going to cause an awful lot of financial instability. The financial markets aren’t going to wait for the result of the vote, they’re going to act with their feet straight away!
If Marine Le Pen wins, I think you’re going to see substantial capital flight from France even before she announces the referendum, and a lot of money leaving France. I could see a real banking crisis following from that, as people try to get their money out and to put it in, as it were, safer members of the eurozone, principally Germany. There might have to be some sort of capital controls imposed to stop that capital flight and to stop the French banking system from collapsing.
MPN: Looking at economic conditions in Europe today, and specifically in countries such as Greece that continue to enforce a regime of strict economic austerity as prescribed by its lenders, do you believe that exiting the eurozone is still an option for these countries?
RB: I don’t see how Greece can escape from its current situation without a much-devalued exchange rate. Spain is a country that is now recovering, and I think would probably be able to stay in the euro system, although not if Italy leaves and devalues. Italy, especially, and Greece, I don’t see any chance of emerging from their current economic torpor that doesn’t involve leaving the euro.
MPN: In Greece, there are various arguments that are heard against Grexit, ranging from claims that it’s too late and that it is something Greece should have done seven or eight years ago at the onset of the crisis, to arguments that a catastrophic devaluation of the new currency would follow, or that hyperinflation would result, or that Greece would be unable to import vital necessities. How do you respond to these arguments?
RB: There’s no doubt that it would be possible to do Grexit badly, and in the same vein, it’s possible to do Brexit badly. You could make a complete mess of it. There’s no doubt that’s possible. It’s very important, I think, not to let the perfect be the enemy of the good. Yes, there will be difficulties as a result of Grexit, but the most important thing is, it gives hope.
You have to ask yourself what you’re comparing your option with. A country that’s lost something like 25 percent of its GDP, that has a huge proportion of its workforce unemployed, there doesn’t seem to be much hope under the current situation. So I think it’s a bit extreme to say “oh gosh, if Greece left the euro, there would be hyperinflation.” Well, there wouldn’t be hyperinflation at all. If it’s managed properly, there wouldn’t be an uptick in inflation, and that wouldn’t necessarily be all bad, because it would help to devalue the real value of some of the debt.
You’d have to, though, keep this under control. It would have to be well-managed. You would need the effective management of the Bank of Greece and the Greek government to make sure that this was a fairly benign process. That doesn’t mean to say that you can avoid pain. You can’t avoid pain! You’ve had pain for the last how many years in Greece, and this is a country that’s lost 25 percent of its GDP!