(First published in Urban Times on 23rd Dec 2011)
The mechanism that controls the flow of blood controls the entire organism.
European Sovereign Crisis, Ground Zero – Sector Greece:
Rearing its head in 2009, when experts were called in to inspect the finances of the peripheral EU nation, and breaking out in full force in 2010, when the full extent of the damage became apparent, the Greek financial crisis has turned into an ongoing tragedy. Humongous debts and deficits plaguing the state’s economy were revealed, showing how broken the economy was.
The situation was so grave it required immediate and unequivocal assistance from outside bodies. Agreements were made with the EU and the IMF to bail out the Greek nation on the conditions it undergoes structural reforms.
The reforms went ahead, exercised in large part as austerity measures, slashing public spending while raising taxes sharply and abruptly. They attracted intense criticism, both locally and from abroad, for being neither appropriate nor realistic. Critics claimed they were in fact leading the Greek economy to stagnation with mathematical precision, invoking a death spiral that would see the austerity measures raising money at the expense of growth, which would instigate harsher austerity measures to save more money, which would shrink the economy even more, and so on and so forth.
The citizens of Greece made their point for them. Voicing their dissatisfaction, then their indignation, then their inability to go through these measures at such rapid pace, they declared that despite what had happened i.e. the all-around abuse of the state by politicians and citizens alike, this was no way to rectify the situation. Things were happening too fast, too brutally. Necessary as the structural reforms were, they were enforced too crudely and with little explanation as to why they were taking place, making the citizenry feel they were being robbed in broad daylight.
It was like violent chemotherapy, applied to a weak cancer patient, taking out swaths of healthy cells for every cancerous one. The people protested, leading up to a cascade of street violence, strikes and civil disobedience that rendered Greece a battleground.
But it was the markets who had the final say on what would happen, not the citizenry of Greece. Reacting adversely to the instability in the region, showing their disapproval of the local economic landscape, the markets dictated policy on all fronts, forcing the admittedly flawed policies of over-applied austerity measures to continue. This was done via the actions of individuals working for certain companies and interests in the name of market health. In the name of the economy’s wellbeing.
The result was more Greek violence and instability, which led to a drop of confidence in both the region as well as the Greek state’s ability to enforce the austerity measures on time. Which in turn led to more market instability. Which led to panic in the European and other economies.
Eventually, to contain fears of collapse, an agreement to shave off 50% of (part of) the debt was reached. The haircut, as it was known, even though unpopular with creditors and markets, was the only way to avoid crushing the country.
It was also a move that corroborated what citizens and critics had been saying all along: that the restructuring of Greece could not be done in the blink of an eye.
Still, the critics and the people of Greece were not vindicated. Whatever was done after realizing that the restructuring was not going according to plan, was done not because the critics had convinced anyone of the impossibility of the task but because the markets could no longer afford a rescue plan without a haircut. In other words, markets were more influential and far-reaching than people. Their reactions were more central. Their demands were met, no one else’s.
To sum up, the combined forces of markets, finance, and the economy in general i.e. the economic organs of this planet, managed to take over the proceedings, dictating policy across the board. They forced politicians to do their bidding and citizens to abide to their numerically-driven, abstractly-conceptualized needs. They’re the medium that carries everything forth, somehow taking over the will of the individual, their needs always met first. They’re the mechanism that controls the flow of resources to any given place on earth, making the rules, like a brain that regulates the rest of the body.
Politically, the markets have just scored major victories in open society, laying claim to the livelihood and destiny of many tax-paying, hard-working westerners, who, ironically, as it often happens, were caught in the socioeconomic crossfire, forced to pay up to cover the holes left by their tax-evading compatriots and their mindless politicos. Be it a conspiracy or a natural event, the outcomes speak for themselves. Bankers are in charge, period, playing global games of chess and thrones, and the ones who feel the brunt of the gambit are the good and virtuous individuals among us, suffering the consequences of economic folly/backdraft, paying for other people’s ineptitude and avarice combined.
Greece will be better off when the restructuring is complete, that is certain. To do so, it has to survive the process. If it doesn’t, if it can’t withstand the furious changes, it will falter and fail.
What this means in real terms is that people will rise up in violence and fight for food, shelter, and security. When they do, chances are that the political and social unrest will spread like wildfire, and that instability will grow.
It’s a lesson world history has taught us all too well. We seem to have forgotten it, applying measures that tend to the numbers while forgetting to mind the people that make them up.