Greece: What's burning is consent

 

Public reaction has been very hostile, and the debate has been accompanied by strikes and violent protest

It started, as it always starts, with the communists: the trade union PAME formed its ranks, linked arms, sang songs and marched.

There were many older faces in the crowd: pensioners, manual workers in their fifties.

The world for them is about to change. Public services that have been a fixture of Greek life for decades will be closed or privatised; long cherished rights will go; pension pots will shrink - but above all the social deal these workers thought they had will vanish.

They came on, still, in the same old way: rigid, determined, clutching heavy sticks and crash helmets. They passed the riot police, the parliament, the indignados and their squatter camp - and marched away.

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This is the first time in all the Greek protests of the past 18 months I've felt real danger”

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Now Syntagma Square filled with other protesters: the middle class, the salariat, the youth, people with tattoos up their legs, bare midriffs; a man in a tight Armani shirt and a white gas mask on his elbow.

Earth mothers, grandmothers - if the image of Glastonbury keeps occurring to me it's for a reason - by now this protest is no longer the preserve of one segment of the demographic, or of politics. It is a cross section: right and left, young and old.

The nationalists, who've claimed the ledge above the square as their territory, are the toughest bunch.

The "indignados" - anarchist youth and just generally youth who've camped out there in the square for 35 days, their territory is below. The black bloc anarchists? Where do they come from - it is never clear but they always somehow do.

Stun grenades

Bottles and stones are thrown. The police - who've spent the night before clashing violently amid teargas so voluminous it still stings today before the trouble's even started - fire the first of Wednesday's gas, and a volley of stun grenades.

The crowd - not geared up at all for this - runs down the slope. Within seconds our eyes are streaming. A man, white faced with the alkaline cream they use to stem the burning - screams at me: "This is Greek democracy. We stand here peacefully and they fire gas at us. I'm a businessman - my turnover is 80% down, what am I supposed to do!"

Demonstrators walk among debris Demonstrators come from all sections of Greek society

The gas is fierce. It does not just sting your eyes and throat, your skin feels like it is burning. This is maybe an occupational hazard for the youths in balaclavas who now appear, but not in the life-plan of the grandmothers and mothers who've been sitting peacefully in the street where the grenades are landing.

If you wanted to give a demonstration of how to alienate people from politics this is it - but the police, after nights of violence and abuse from the crowd, are alienated enough themselves.

We move into the square. Most people are trying to flee the fighting but some move towards it, up the famous steps of Syntagma. We move with them, filming with hand-sized stills cameras to avoid getting hit by the hardline protesters who insist the media is part of the state.

As we advance, teargas canisters spiral down and land at our feet: the protesters pick them up and throw them back, kick them around like an extreme sports version of five-a-side.

At the top of the steps is deadly space - we're slipping on something and it is blood. The cops snatch somebody and beat them. All around young men are now smashing the marble stones of the square for projectiles: big, lethal projectiles.

Soon the police move in to break this up, taking all four corners of the square. But in the process a dense crowd stampedes along a wide thoroughfare.

Real danger

This is the first time in all the Greek protests of the past 18 months I've felt real danger. Most people do not have masks; they are crushed together; you sense that scramble beginning as people push each other.

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This, in clear red letters, is what happens when economics go wrong”

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We reach a side street. People clap their hands in the air and do the Greek "cursing" gesture with open hands, which simulates throwing dirt at somebody, and is millennia old.

One guy is a classical pianist who has studied at the Royal Academy: "They've lost the people completely. There's no way we can accept the austerity plan. People are broke already. You've seen this - they can only speak to us with riot police and gas."

A woman, bank worker, early 20s, outraged: "They do this every time. We will stop them." How, I ask: "We will just keep going on strike."

As we speak the crowd surges down the narrow street. A man, in the familiar white-face alkali slick and a mask, shouts at me: "I'm an interior designer; I've worked in England for 10 years. This is not democracy - they never let us vote for this."

As we try to get away, it's clear the whole area of the Plaka, narrow streets with small businesses - flower shops, delis, vegan restaurants - is now a battlezone.

Protesters walk among teargas Faced with bottles and stones the police retaliate with teargas

While the violent disorder in the square is capturing the attention of the world, what's going on here should be also worrying: this is "middle Europe" - not a bunch of dedicated protesters.

They feel collectively punished for being here; they don't throw stones but when attacked they're happy for others to do so.

A burning barricade starts. Just yards away a crowd has formed to watch the parliamentary vote. Zoned out, some of the women are doing the open hand thing at the screen, as the MPs vote the austerity package through and on the split screen there's the black bloc hurling firebombs at McDonalds.

And just yards away, the actual black bloc, ebbing and flowing through the Plaka, on fire.

It's weird to be an economics journalist reporting this: because I am coming to the conclusion that this is the next phase of the economic story - penury at the edge of Europe eating away at both social cohesion and the resilience of the financial system.

In my profession we always keep telling ourselves we've got to do more stories on small businesses, but I've just had five or six small businessmen, self employed, entrepreneurs etc yelling at me an agenda you don't usually associate with such people: outright rejection of the political system and politicians in general.

This, in clear red letters, is what happens when economics go wrong.

Antonis Papayiannidis, a lawyer and political columnist I meet by dodging through the smoky streets to his office, believes Prime Minister Papandreou has been "heroic" but can do no more.

The execution law to be passed tomorrow, he says, will simply fail in practice - running into the old obstacles to change here. Greece will leave the euro and everybody will become poor together - "at least it's equal" he says.

"The political class was never accountable - it floated above the people, separate from them. But we got rich - under the euro - so we accepted it; and they got rich; and all sides love the public sector. They love doling out jobs to people. But now the political class is still floating, detached, but it has nothing to deliver."

Democracy will survive, but it's in danger, says Papayiannidis - from "mob resistance" rather than mob rule: "When you get the petit-bourgeoisie enraged, combined with those who are just at the edge of poverty, there's no precedent for it here, but there is in Germany in the 1920s. And the outcome was not nice."

What Greece is being forced to do is threatening the legitimacy of a democratically elected government and putting at risk the legitimacy of the political system in general. And the question for the EU and IMF is simple: is it worth it?

 
Paul Mason, Economics editor, Newsnight Article written by Paul Mason Paul Mason Former economics editor, Newsnight

End of an era

After 12 years on Newsnight, Economics editor Paul Mason has moved on to pastures new and this blog is now closed.

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  • rate this
    +1

    Comment number 31.

    #30 BluesBerry

    I wonder if the French rolled-over loans are denominated in Euros and subject to French law and if the old loans were subject to Greek currency and Greek law.

    It would give a reason for the French banks to go along with it, and the Greeks would not be able default on the loan (a bit like UK students)

    The Greek people should get out now whilst they still have the chance

  • rate this
    +1

    Comment number 30.

    Why would banks volunteer for this deal?
    The French proposal allows banks to mark NEW debt as “held-to-maturity,” meaning they are not compelled to recognize their own LOSSES. It also buys time, not for Greece to recover, but for EU politicians to work out some way for the LOSSES to get lost among the taxpayers. Seems to me that something nefarious this way comes.

  • rate this
    +1

    Comment number 29.

    S&P plays a little more with the definition. Let me quote: “whereby one or more financial obligation is either repurchased for an amount of cash or REPLACED BY OTHER INSTRUMENTS” = Selective Default.
    The ratings agencies must be cracking under pressure to bend, if not break, their own rules.

  • rate this
    +1

    Comment number 28.

    The NEW Greek debt would have 5.5% interest rate. This is a lot of wangling & dangling so that a default may not seem a default. It may cause banks accept diminished economic returns - but how dumb do you have to be financially not to see "D". Fitch ratings agency has already said it would view such a deal as a default; other agencies have not yet committed.

  • rate this
    +1

    Comment number 27.

    French banks have proposed a burden-sharing plan ("voluntary"), as though voluntary is a economic, magic word. Under the plan, holders of Greek bonds maturing in the next 3 years would agree to roll over 1/2 exposure into new Greek 30-year bonds. Another 20% would go to fund a vehicle to act as collateral against Greek default. What is there about this that is not a credit event?

 

Comments 5 of 31

 

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