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Wednesday, September 26, 2012

Letters: Taking to the streets to defend democracy

Seumas Milne's warning to Labour that now is the time to oppose the coalition's discredited ideology, "Better have that argument now than in the runup to an election", ends with the significant, if quiet, coda "it's not one that can be left to politicians alone" (The coalition's phoney war is an exercise in political fraud, 26 September). Well done the editor who placed it alongside Katharine Ainger's piece (A financial coup d'etat) on the Spanish indignados who, like the citizens of Greece, Ireland, Portugal, Italy and France, are taking to the streets in defence of democracy. Ainger ends with a reminder that 600,000 Portuguese swarming the gates of parliament and city centres forced their government into a U-turn. As FD Roosevelt said: "Democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than their democratic state itself." We must ensure the citizens of the UK are out in their hundreds of thousands on 20 October in defence of our democracy.
John Airs
Liverpool

• Andrew Mitchell's behaviour is not only a comment on the Conservative party and the police (Editorial, 26 September). It also reflects wider problems with politics in the UK. Thinktanks and consultants now dominate the policy process and the political establishment imagines itself distinct from, indeed above, the rest of the country. We need a fundamental shift in the attitudes of the political elite and a new programme of action in which citizens are valued as co-creators of democracy, not simply voters, clients, protesters or volunteers.
Craig Jeffrey
Oxford


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Greek riots, Spanish marches shatter market calm

ATHENS, Greece (AP) — Europe's fragile financial calm was shattered Wednesday as investors worried that violent anti-austerity protests in Greece and Spain's debt troubles showed that the continent still cannot contain its financial crisis.

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The politics that matters is happening on the streets of Europe | Suzanne Moore

While we allow ourselves to be distracted by Andrew Mitchell's antics and conference season, in Spain and Greece citizens are fighting for control of their destiny

Cull the Lib Dems. No more apologies. Ask the Queen what she thinks. Or elect badgers, as they will be just as useful. Make Andrew Mitchell minister for truth! I may be a pleb – mirabile dictu! – but I know a distraction when I see one. Domestic politics enters conference season and we all have to pretend it matters. What we are actually seeing is the brandishing of powerlessness from our political class, the shrinking of their ability to think differently or even widely.

Gate-gate was amusing for all of five seconds, though I don't mind a bit of swearing myself. That a muppet such as Mitchell looks down on working people hardly struck me as a scoop. Phillip Blond's peculiar suggestion that we start talking about caste instead of class would I suppose make clear who the untouchables really are, and stop the worrying delusion that the majority of people are middle-class. Nick "I am sorry" Clegg and Vince "I told you so" Cable have jostled for power and defined freedom for us. Clegg himself veered between The Thick of It's quiet batpeople and visions of fascism. As you do.

What interested me was his warning that if we do not write our own budgets we could end up like countries that "find their right to self-determination withdrawn by the markets, and new rules imposed by their creditors, without warning or clemency". In other words there is no alternative to cuts. "The markets" are in charge, so why then even have party political conferences?

This just after we have seen the extraordinary images from Madrid where protesters were shot with rubber bullets. No, we are not Spain. And "Spain is not Uganda", as the Spanish prime minister, Mariano Rajoy, helpfully texted his finance minister recently. Spain is not Greece either, but why do we play down what is not so far away? Two hours away becomes another world.

So we watch protesters bludgeoned and accused of an attempted coup. We see the graffiti – "The End of Fear" – and we surely recognise, even though we are not in the euro, this attempt to slam austerity on to the population for their own good. The Spanish economy is contracting. For months miners have been fighting police with rocket launchers in Asturias. They don't want a revolution, just a living wage. Unemployment is crippling. There are no jobs for more than half of Spanish youth. Ghost villas crumble as the construction industry grinds to a halt, yet Rajoy is expected to make spending cuts of more than €65bn. There is still a middle class in Spain, unlike Greece, able to soak up some of this damage.

But as the government spends a fortune on tear gas, the centre cannot hold. One and a half million Catalans marched for independence. Constitutionally, no one knows how this can happen, but it is spoken about with inevitability. Thus the crisis will tear apart countries as well as families. It will be a tough technocrat who can hold the north and south of Italy together.

These people who hurt in the places where we used to play have been told like us that they overdid it, and now it is payback time. Our government's story that it is all Labour's fault works only if you avoid all foreign news. But how are we to position ourselves? Must we merely accept that politicians have no choice? That punishing the poor is simply pragmatic, so let's not get all hot-headed like these Mediterranean types?

Well, look at Portugal, hardly famed for its crazed radicalism. When Prime Minister Pedro Passos Coelho announced a rise from 11 to 18% in social security payments as part of its €78bn bailout, Portugal saw the biggest demonstrations since ridding itself of dictatorship in 1974. The government has now U-turned in the face of masses of all political persuasions. Their posters were telling: "We are not the children of democracy, we are the parents of the next revolution."

This is the backdrop to which our party leaders will set out the agenda. We will have to accept that there is no alternative and that only the likes of Osborne and Laws understand the complexities of what they will push through.

Globally, another narrative exists: from Occupy, from the 99%, or even the 47% – or even us plebs could roll one out. But nowhere is it represented in the party system. As party leaders congratulate themselves on the tough choices they make, not one will say we are slashing the NHS by precisely the amount the war in Afghanistan costs us. Not one will explain that stopping tax avoidance by the super rich would pay for a functioning welfare system. Instead, we are offered the choice only between who can cut most earnestly and most efficiently.

We do not need to be tear-gassed into submission as we simply keep our eyes shut tight while Athens burns. Again.

The message remains that there is no alternative to austerity, but remember the Paris 1968 slogan: "Those who lack imagination cannot imagine what is lacking." When no alternative can be voiced by our main parties, the deficit is not purely fiscal. It is one of democracy.


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Hundreds of thousands of Greeks march against austerity

General strike brings country to a halt in first confrontation with three-month-old government

Hundreds of thousands of anti-austerity protesters took to the streets of Greece on Wednesday as the country was paralysed by a general strike in the first mass confrontation with Athens's three-month-old coalition government.

In one of the biggest demonstrations in the capital in recent years, as many as 200,000 marched on the Greek parliament, according to unions in the public and private sector, which called the strike to oppose new wage and pension cuts – the price of further rescue funds from international lenders.

Clashes broke out between riot police and hooded youths hurling rocks and petrol bombs at the finance ministry. The protesters, many shouting: "We can take no more. Out with the EU and IMF," and said to be part of the crisis-hit country's vibrant "anti-establishment" movement, then set light to rubbish cans and bus stops, sending plumes of acrid smoke above the capital. TV footage showed demonstrators running for cover in Syntagma Square, seat of the Greek parliament, as noxious fumes filled the air. More than 100 people were detained.

With tensions running high over the new measures – part of a mammoth €11.9bn austerity package that is set to save the state more than 5% of GDP over the course of the next two years – unions are warning that the conservative-led government should take stock or worse could come.

In a departure from other mass protests, members of the police force, army, navy and judicial system joined public and private sector employees on the streets. One police officer, who preferred not to give his name, said the Greek state "should feel deep shame" at imposing cuts on the very people whose protection it sought.

"This is a warning to the government not to pass the measures," said Ilias Iliopoulos at ADEDY, the union of civil servants, insisting that around 350,000 Greeks took part in protest marches nationwide (police put the number in Athens at around 70,000). "Today was a huge success as witnessed by all those in the armed forces and police who also participated because they, too, will be affected by these cuts. The government must know that if it wants to push us further into a corner, we will react."

Echoing a view held by many Greeks, Penelope Angelou, an unemployed mother, said passing the measures would be tantamount to a "parliamentary coup".

"These parties were given our vote back in June because they promised to re-negotiate the terms of the loan agreement," she said, referring to the onerous conditions of the bailout accord Athens signed with its "troika" of creditors — the EU, ECB and IMF – earlier this year. "We are all tired," she said. "This is the third year of non-stop cuts and tax increases which have made us poor and divided us as a society. And they have not solved our problem. The recession is going from bad to worse."

Since the outbreak of Europe's debt crisis in Athens in late 2009, ordinary Greeks, worst hit by repeated rounds of austerity, have seen their purchasing power drop by as much as 50% as poverty and joblessness has reached record levels.

After a heated summer of tortuous wrangling with lenders, the alliance led by the prime minister, Antonis Samaras, is expected to finally give the package the go-ahead on Thursday. Time is of the essence, say officials, if the Greek economy is to receive a bumper rescue loan of €31.5bn, put on hold by the troika since July. The injection is now vital to "warming up" the cash-starved real economy. Creditors have made clear that without the controversial measures, there can be no money – a scenario that would see Greece defaulting on its debt, being forced to declare bankruptcy and leaving the eurozone.

"The cuts have to happen because we are at war, an economic war," the country's defence minister, Panos Panagiotopoulos, said this week.

Once endorsed, the package will be sent to the parliament for ratification, probably next week. But the government's highwire act of trying to placate lenders while ensuring that the nation is not pushed over the edge will not be easy. Polls have shown the vast majority of Greeks see the measures as deeply unfair and antisocial. Highlighting fears that the recession-inducing policies have pushed Greece into an economic death spiral, the ratings agency Fitch declared on Wednesday that far from being reduced, Athens's debt mountain was growing, with the country's debt-to-GDP ratio set to increase from its current 164.9% to 180.2% in 2014.

"Once the Greek people learn exactly what the measures are there will be uproar," Iliopoulos, the trade unionist, told the Guardian. "Parliament will see mass protests. And it won't be nice."


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Greek Workers Hold General Strike


Democracy Now

Greek Workers Hold General Strike
Democracy Now
Greek workers are holding their first general strike today since the country's conservative-led coalition government came to power in June. Thousands of Greeks are converging outside the Parliament in Athens. The general strike is expected to shut down ...

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Schoolchildren stumble on grenade stash

Greek authorities say schoolchildren playing on a road construction site have stumbled on hundreds of hand grenades stashed away during the civil war. Army officials in the northern town of Serres say explosives disposal experts had removed and safely defused more than 400 Russian-made grenades by Wednesday.




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Osborne's second fiscal rules looks increasingly unattainable

IFS urges the chancellor to drop his debt rule - but that shouldn't let the coalition off the hook

Britain's top tax thinktank, the Institute for Fiscal Studies, has added its voice to Sir Mervyn King's in offering George Osborne an alibi for dropping his second fiscal rule at December's autumn statement. The coalition promised, in its "supplementary target", that debt as a proportion of GDP would be falling by 2015-16; but with the Office for Budget Responsibility likely to downgrade its growth forecasts yet again, and revenues coming in weaker than expected because of the double-dip recession, that's looking increasingly unattainable.

The IFS's reasoning is different from King's. While the governor suggested that Osborne would be justified in changing course because external events - not least the eurozone crisis - have made it tougher to hit his targets, IFS deputy director Carl Emmerson says in a new article that the rule was never worth the paper it's written on.

As Emmerson and his colleague Gemma Tetlow put it: "Forcing debt to fall between two fixed dates does not ensure long-run sustainability, since it does not constrain the government from allowing debt to rise inappropriately before or after those dates."

Instead of seeing the chancellor hurriedly replace the target with a new rule drawn up between now and December, the IFS's number crunchers urge him to launch a cross-party consultation, with a view to coming up with a more sensible rule before next year's Budget.

They're absolutely right that the debt rule is all but meaningless, and won't secure the long-term health of the government's finances. But that shouldn't blind anyone to the fact that if Osborne stands up on 5 December and is forced to abandon the rule, it would be a humiliating admission that the coalition's deficit-cutting strategy is way off course.

Ditching the rule would be a better approach than the Treasury slashing about with the spending axe in a desperate bid to meet an arbitrary target, just as the economy looks likely to emerge from double-dip recession.

But there should be no hiding the fact that the coalition were far too optimistic about the economy's resilience in the face of savage spending cuts. Revenues are weaker than expected, and spending is higher, because the economy remains so fragile. Nick Clegg argued in his speech on Wednesday that the government faces, "the gargantuan task of creating a new economy from the rubble of the old". But as Greece's pitiful example should have shown, austerity for its own sake is no way to rebuild an economy: in fact, it's just as likely to be self-defeating.


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Nick Clegg reprises scare-mongering Greek comparisons


The Guardian (blog)

Nick Clegg reprises scare-mongering Greek comparisons
The Guardian (blog)
Saving the nation was why he yolked his party to Cameron: this speech reprised his scare-mongering Greek comparisons. Any relaxation of austerity risks the country going bust: with dark 1930s allusions he warned that "extremists thrive in tough times." ...

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Greek, Spanish anti-austerity protests shatter Europe's relative financial calm


Greek, Spanish anti-austerity protests shatter Europe's relative financial calm
Newser
A Greek orthodox priest walks next a docked ship during a strike at Piraeus, the port of Athens, on Wednesday, Sept. 26 2012. A nationwide general strike in debt-crippled Greece against planned new austerity... (Associated Press) ...


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Greek, Spanish riots shatter European market calm


The Associated Press

Greek, Spanish riots shatter European market calm
The Associated Press
By ELENA BECATOROS, AP – 3 minutes ago ATHENS, Greece (AP) — Europe's fragile financial calm was shattered Wednesday as investors worried that violent anti-austerity protests in Greece and Spain's debt troubles showed that the region still cannot get a ...
Tear Gas Fired at Athens ProtestWall Street Journal
Police clash with hooded youths during Greek general strikeAFP
Clashes at Greek austerity protestsIrish Times
Reuters India -BBC News -New York Times
all 1,098 news articles »

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Eurozone crisis returns to rattle markets after period of calm

Economic figures from France, Italy and Spain mixed with civil unrest and political dithering cause stock exchange turbulence

Market jitters over Europe's debt crisis returned after weeks of relative calm on Wednesday amid a welter of grim statistics from some of the biggest European economies, mixed signals from bickering eurozone political leaders, and mass protests against austerity in southern Europe.

As unrest gripped Greece, Spain, and Portugal, Madrid's borrowing costs surged through the 6% threshold after the leading eurozone creditors made it plain that a planned €100bn (£80bn) bailout for Spanish banks would saddle the country with higher debt levels.

The lack of political will to fix the crisis was reinforced by the European commission flatly contradicting the governments of Germany, the Netherlands and Finland after they walked away from pledges delivered at an EU summit in June.

The grimmer mood enveloping the eurozone was also underlined by figures from France putting the jobless rate at more than 3 million for the first time in 13 years and by falling retail sales reported from recession-hit Italy. Stock markets fell across Europe with the FTSE 100 down 1.5%, while the German Dax and French Cac 40 were down 2% and 2.8%. The surge in French unemployment will complicate President Fran├žois Hollande's hopes of beginning to tackle France's economic malaise. The increased expenditure on benefits and the fall in tax receipts will also make it harder for France to meet the EU-prescribed budget deficit target of 3% by next year.

Hollande came to power in May on a campaign of resisting German-led austerity. He now needs to plunge France into austerity — though he does not use that term — to make savings of €30bn through spending cuts and tax rises. Details will become clearer on Friday when his government's first budget, for next year, goes to cabinet.

Mired in a deepening recession, with the economy projected to shrink by at least 2.4% this year, Italy also posted more bad news, with retail sales figures for July showing a 3.2% fall on a year ago.

But as Madrid's cost of borrowing shot up, Spain's predicament — coupled with the widening eurozone splits over how to respond — was the biggest factor unnerving the markets. While the prime minister, Mariano Rajoy, appears condemned eventually to having to request a humiliating bailout which, according to German finance ministry estimates, could amount to €300bn, he continues to play for time.

The eurozone is divided over how to respond. Hollande and the Italian prime minister, Mario Monti, are pressing Rajoy to request a bailout. Berlin is encouraging him to play for time. Chancellor Angela Merkel is moving into an election year and is reluctant to return to parliament in Berlin to argue for another unpopular eurozone rescue programme.

The split between Berlin and Paris over Spain reflects much broader and fundamental divisions over policies dealing with the sovereign debt crisis. Two big policy shifts in recent months brought a respite in the crisis, giving leaders time to come up with more substantive action.

In June, an EU summit declared that policy had to be aimed at breaking the vicious circle linking vulnerable banks and weak sovereigns in a downward spiral of bigger debt. To that end, they decided to use the eurozone's bailout funds to recapitalise weak banks directly without adding the loans to a state's debt.

The second big move was from the European Central Bank which earlier this month announced a new policy of unlimited intervention in the markets to buy up shaky government bonds. The June consensus on lending directly to weak banks was always fragile, but collapsed on Tuesday when the eurozone's key triple-A rated creditors, Germany, the Netherlands, and Finland, issued a surprise statement declaring the bailout funds could recapitalise banks directly only as a last resort, that the policy was a longer-term option, and could not be applied to pre-existing or "legacy" bailouts, namely Spain and Ireland who had their hopes pinned on the June breakthrough. Direct bank recapitalisation has been effectively frozen before it even began.

On Wednesday, the European commission stemmed the shift from the three countries, insisting policy agreed in June had to be implemented promptly. "Our position regarding breaking the vicious circle between the banks and the sovereign is very clear … This should be done quickly" said EC spokesman Olivier Bailly.

In agreeing to the direct bank loans in June, Berlin demanded that first there needed to a new regime based at the ECB for supervising eurozone banks. The commission drafted the complex legislation in less than three months, unveiling it a fortnight ago. Berlin is now dragging its feet, delaying the new regime while insisting it should not police the vast majority of German banks.

In sharp contrast, France's Europe minister, Bernard Cazeneuve, said this week in Brussels that the new bank supervisory regime had to be created as a matter of urgency.


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Today Greece, tomorrow Spain, then what?


Washington Times

Today Greece, tomorrow Spain, then what?
Washington Times
Objectively speaking, we still have no clue as to why Greece and Spain feel it's Germany's duty to bail out their rotten, profligate governments without teaching them a lesson. But there it is a reason for it all. And it's probably similar to why ...


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On The Observers: In images: After months of calm, anti-austerity protests hit Greece anew

 

For the first time since Greece’s new government was elected last June, Greeks took to the streets in massive numbers in Athens and Thessaloniki to protest austerity measures. Our Observer, who was among them, captured the protest with his camera. Read more...

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Greek general strike turns violent


Greek general strike turns violent
Salon
Greek general strike turns violent. More than 50,000 people joined union-organized, anti-austerity marches. By Associated Press. more. All Share Services. Topics: Austerity, Eurozone, General Strike, Greece, RiotsNews,. Greek general strike turns ...


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Why Europe is looking like a mess (again)


Sydney Morning Herald

Why Europe is looking like a mess (again)
Washington Post
Just a few days ago, Europe's long-simmering financial crisis seemed to have reached its resolution following demonstrations of resolve by all players involved to deploy whatever means necessary to heal the deep fissures among the 17 nations using the ...
Anti-cuts protests erupt on streets of Athens and MadridReuters
Brent Crude Falls More Than 1% on Euro Zone CrisisCNBC.com
Oil drops on questions about Europe's crisisBusinessweek
USA TODAY -Bloomberg -Wall Street Journal (blog)
all 2,357 news articles »

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Greek schoolchildren find hundreds of civil-war hand grenades on road ...


Greek schoolchildren find hundreds of civil-war hand grenades on road ...
Washington Post
THESSALONIKI, Greece — Greek authorities say schoolchildren playing on a road construction site have stumbled on hundreds of hand grenades stashed away during the civil war. Army officials in the northern town of Serres say explosives disposal experts ...

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Photos: Greek general strike turns violent

Photos: Greek general strike turns violentA molotov cocktail explodes beside riot police officers near Syntagma square during a 24-hour labour strike in Athens September 26, 2012. Flights and trains were suspended, shops pulled down their shutters and hospitals worked on emergency staff on Wednesday in Greece's first big anti-austerity strike since a coalition government took power in June. REUTERS/Yannis Behrakis (GREECE - Tags: BUSINESS CIVIL UNREST POLITICS TPX IMAGES OF THE DAY)

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Greek schoolchildren find hundreds of civil-war hand grenades on road construction site

THESSALONIKI, Greece - Greek authorities say schoolchildren playing on a road construction site have stumbled on hundreds of hand grenades stashed away during the civil war.

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Austerity sparks violent protests in Greece, Spain


Austerity sparks violent protests in Greece, Spain
USA TODAY
A day after U.S. stocks suffered their biggest retreat in three months on comments from a leading official at the Federal Reserve, investors in Europe and Asia have grown jittery as the protests in Greece and Spain turned ugly. In Athens, police ...


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Price of oil falls as protests in Greece, Spain raise more worries about ...


Price of oil falls as protests in Greece, Spain raise more worries about ...
Washington Post
The price of oil is dropping as protests in Greece and Spain offer visible reminders that Europe is still struggling to resolve its debt crisis. Benchmark oil fell $1.54 to $89.83 per barrel Wednesday in New York. Loading... Comments · Weigh In ...

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