website of the committee for a workers' international, CWI
Elections loom as IMF’s austerity plans revealed
Danny Byrne, CWI
Protests, strikes, bailouts, governments collapsing and elections. This is the situation in Portugal, the latest country in Europe to fall victim to the “aid” of the IMF and EU. It is passing through dramatic days. Representatives of the IMF, European Central Bank and European Commission, dubbed “the Troika”, are engaged in daily discussions in Lisbon. At these encounters the diktats of these vultures are fed to their willing representatives in the Portuguese caretaker government. Although officially secret, the daily leaks from these fraternal discussions reveal crumb by crumb, the austerity which will characterise life for millions in Portugal under Troika rule.
Householders will no longer receive the tax relief. This often means the difference between shelter and homelessness. The 13th and 14th months “extra” payments in public sector wages are to go, or be replaced by government bond investments! These are just a few examples of the many draconian measures that going to be introduced. They will be accompanied by wholesale attacks on workers’ rights, including a “reform” that will cheapen sackings to and make them easier. There will also be an attack on collective bargaining for the trade unions. All this is to “"save the country"”, according to the establishment, the banks, and capitalist parties! But it was them who ruined the country in the first place!
The main Portuguese banks, which now preach the necessity of bending over backwards to please the Troika, were the very ones who pulled the trigger on the Portuguese economy, leading the government to call in the EU/IMF. They withdrew together from funding state debt at the beginning of April, with the official request for external aid being made only hours later. What better illustration of the insane dictatorship of these parasites! Any “socialist” government in the least bit worthy of the name would have immediately nationalised the banks in response to this, ensuring the funding of government could continue. But the completely misnamed and pro-capitalist “Socialist” Party government of Jose Socrates, who had recently resigned as Prime Minister, having failed to ram through yet another austerity package to please its EU/IMF masters, took this ultimatum with typical servitude.
This cynical action by the banks was wholly motivated by a desire to maximise profit at the expense of the nation’s crisis. While poverty beckons for millions due to the austerity already implemented in crisis-ridden Portugal, the picture is not one of “sacrifice for all” as the capitalists put it. The bankers are still living the high life! Millennium BCP, BES, Santander Totta and BPI, the five biggest private banks, recently announced profits of over 252 million euros, in the first trimester of this year (during which the country has constantly teetered on the brink of bankruptcy)! They hope that the conclusion of a deal with the EU/IMF, in the interests of the big bankers, will create the conditions for further bumper profits in the future.
The measures they advocate now represent a declaration of savage class warfare against the poor. It is also, in economic terms, a recipe for a deeper crisis, recession and default. Already Portugal represents a text-book example of the failure of austerity to lead to economic recovery. The Troika’s austerity will deepen the crisis further. Deflationary measures, such as the axing of wages and benefits, along with the facilitation of precarious labour and easy sackings will have a disastrous impact. Across the border in Spain, a labour reform package similar to what the IMF is proposing, was also justified on the grounds it would cut unemployment. This provoked a general strike in September last year. Since it was introduced unemployment has jumped to almost 5 million. Cheapening sackings is a green light to employers to make redundancies and encourage the existence of precarious jobs and contracts, something already endemic for young workers in Portugal.
The problem that Portuguese and international capitalism face in attempting to push through the Troika deal and austerity is that workers and youth will instinctively move into struggle to oppose it. This was demonstrated in the movement which erupted and led to the downfall of the Socrates government. The ten days preceding his resignation saw a combined total of over 400,000 people take to the streets and many strikes taking place. This followed a general strike on 24 November 2010 which brought the country to a standstill. 85% of workers downed tools! The opportunistic decision of the PSD (main conservative opposition party) to vote against Socrates’ “PEC IV” (austerity measures) [after supporting the first three], which led to the government’s collapse was a clear reaction to the mass revulsion that has greeted these anti-worker policies. However, the PSD vote against the outgoing government, will not save them from the wrath of the same workers and youth who will fight any future government implementing Troika diktats. These planned attacks will surpass the brutality of the PEC IV package.
Already, the ruling class’s request for external aid and discussions with the Troika have provoked open opposition. The last ten days have seen thousands take to the streets on two separate occasions. On 25th April, in celebration of the 37th anniversary of the Portuguese 1974 April revolution, and on 1 May mass protests took place. On both these demonstrations, the dominant slogan was "FMI fora daqui!"” (IMF out of here!). Unlike the Irish, the Portuguese people have had previous experience of what IMF intervention represents. In 1983, the IMF intervened, with disastrous consequences for the majority of people, when living standards fell, prices soared and unemployment rocketed upwards.
The current discussions on a possible bailout package are a complete and openly anti-democratic sham. What right do these politicians and marketers have to conclude such an agreement behind the backs of the Portuguese people even before an election takes place to replace the hated Socrates government. This is a stark exposure of what the capitalists mean by democracy. The dictatorship of the financiers, markets, and speculators is allowed to rule supreme in order to defend their interests. To the Troika and the Portuguese capitalists, the wishes of the majority of workers and youth are of no consequence, in their determination to drive their agenda forward. Socialismo Revolucionario (CWI in Portugal) demands that the working class movement; – the trade unions and the left parties - the Portuguese Communist Party and the Bloco Esquerda (Left Bloc) begin an immediate campaign of mobilisation and mass struggle to prevent such a deal being agreed. The choice facing working people is between years of suffering and poverty to pay for the mistakes of the rich, or joining the fight for an alternative.
The belated announcement by the CGTP (the largest trade union federation) of mass demonstrations on 19 May against the Troika intervention’s represent a delayed but welcome break of the trade union leaders’ previous silence on what to do. Indeed, the leaders of the CGTP and UGT union federations, rather than mounting an immediate struggle, entered into negotiations with the Troika when it arrived in Lisbon. However, these demonstrations, despite their inevitable mass character, will not be sufficient to force back a determined and united ruling elite with European and world capitalism behind it. The general strike which rocked the country on 24 November gave a glimpse of the potential power of the working class when organised and engaged in effective action. The strike action which will involve many public sector workers on 6 May will give another example of this power in action.
A real programme of militant struggle, beginning with a 24-hour general strike of all workers, followed by further general strikes and co-ordinated actions, with the aim of stopping the elite in their tracks is what is immediately necessary. Socialismo Revolucionario comrades intervened in the country’s recent demonstrations with material arguing for this course of action and met with a positive response from many.
To their credit, the left parties in parliament, the Communist Party and Left Bloc (which together command about 20% of support) have refused to enter into negotiations with the Troika, and opposed the intervention. For this stand, they have come under intense pressure from the establishment to be involved in an agreement.
In order to most effectively come after all the modern gains of working people in Portugal, the bosses need maximum unity - a ‘united front’ of their representatives in parliament and outside, to force such policies through. It is for this reason that in the last days of the electoral debate, the need for a “strong united” government has been stressed by the ruling elite. On 25 April, a joint press conference was held by former Presidents from both the PS and PSD, all together urging the capitalist parties to work constructively together. This call, which has been echoed ad infinitum is a clear call for a national government, of both the PSD and PS to be formed after the elections, if, as opinion polls indicate, neither party wins enough for an all-out majority. These voices hope that such a grand coalition would be strong enough to drive through the austerity package.
The coming elections will be extremely politicised, due to the gravity of the crisis in the country and the clear political polarisation which exists. The lines of the debate will be drawn around the main questions: do the Troika represents a way out or whether there is an alternative to austerity. These questions are so serious, of such profound importance to the lives and futures of people, that only serious answers will be considered by the mass of people. The left parties must answer these questions with clear and revolutionary socialist alternative that is fundamentally different from all the other parties.
Such answers cannot be provided within the framework of the market capitalist system, which is languishing in crisis. From the point of view of this system, in which the wealth and power of the super-rich are unquestioned and unquestionable, then there really is no alternative to brutal austerity! In their logic it makes perfect sense to accept state bankruptcy and poverty living standards to pay for the debts and mistakes of the bankers and big bosses, because their logic is that of the dictatorship of the bankers and big bosses. The only answers which can genuinely protect the living standards of people, combat unemployment, bring about economic growth or get Portugal out of the crisis are those which challenge capitalism. Unfortunately, this has not been the case until now, with both the PCP and Left Bloc only demanding taxation of the rich, - which the CWI supports - – but without explaining how this can be done without breaking with capitalism as part of a socialist programme and alternative.
Genuinely socialist policies - of refusing to pay the debt; introducing a massive programme of socially use public works to provide jobs; the introduction of a democratically planned socialist economy based on the nationalisation of the banks, financial institutions and major companies to use the wealth of society for the benefit of the mass of population could rapidly win support in Portugal if popularised and fought for by the left and workers’ movement. The example of Ireland, in which recent elections saw the Socialist Party (CWI) and United Left Alliance make an important breakthrough, could be emulated in Portugal, but on an immensely higher level! The current strength of the Portuguese left in parliament and society offers a huge platform to put forward such ideas.
The Communist Party’s election slogan of “for a left patriotic government” partly represents a step forward in the sense that it raises broadly speaking the question of an alternative government to one made up of the capitalist parties. But unless such a slogan is given clarity by linking it to concrete socialist proposals, it is insufficient. Also, the term “patriotic” is potentially confusing and could give credence to the idea that a national solution to the crisis of Portuguese capitalism is possible. On the contrary, in this international crisis, where the ruling classes are conducting an international assault, then an internationalist position is not only desirable, but absolutely necessary. Linking up with the working people of Greece, Ireland Spain and other countries under the boot of EU/IMF austerity and fighting for an alternative socialist Europe must be the call of the hour from the left and workers’ movement.
The Communist Party and the Left Bloc, which have a history of bitter sectarianism between them, recently took the positive step of beginning joint discussions on a common platform against the crisis and IMF. The CWI in Portugal has consistently demanded that these parties form a united front armed with socialist policies, which together with the mass movement, can challenge for political power in Portugal, to fight for a government of a different type, for a government of working people, based democratic planning of the economy, as an alternative to capitalism. Now the hour for this demand to be made reality has truly come! Socrates himself recently launched an attack on the left, denouncing them for “never presenting an alternative of government”. The left should begin to present an alternative of government, not that which Socrates calls for, but a government of the left parties with socialist policies.
Committee for a Workers' International
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