Walter Benjamin once said that “every fascism is an index of a failed revolution”. In that sense, the election of 21 members of the neo-Nazi party Golden Dawn to the Greek parliament could be characterised as the revolutionary failure of the century. Progressive forces in Greece have indisputably been unable to stop the wave of neoliberal austerity measures imposed by the “troika” (the IMF, European Central Bank and EU).
Leftwing politicians and academics predicted the debt crisis and even proposed radical solutions including default and bank nationalisation – but they failed to mobilise Greek society. Their voice was muzzled by the mainstream media, distorted by government officials and, most importantly, nullified by foolish internal antagonisms.
Nevertheless, the frightening revival of fascism in Greece cannot be attributed solely to failures of the anti-memorandum forces. It was the main political parties of Pasok and New Democracy who opened the parliament’s door to rightwing extremism. Their austerity frenzy not only destroyed the main pillars of Greek society but also legitimised deeply undemocratic procedures. The constitution was circumvented several times to allow for non-elected officials to implement policies limiting workers’ rights.
“The lesson to be learned from Iceland’s crisis is that if other countries think it’s necessary to write down debts, they should look at how successful the 110 percent agreement was here,” said Thorolfur Matthiasson, an economics professor at the University of Iceland in Reykjavik, in an interview. “It’s the broadest agreement that’s been undertaken.”
Without the relief, homeowners would have buckled under the weight of their loans after the ratio of debt to incomes surged to 240 percent in 2008, Matthiasson said.
Iceland’s $13 billion economy, which shrank 6.7 percent in 2009, grew 2.9 percent last year and will expand 2.4 percent this year and next, the Paris-based OECD estimates. The euro area will grow 0.2 percent this year and the OECD area will expand 1.6 percent, according to November estimates.
Housing, measured as a subcomponent in the consumer price index, is now only about 3 percent below values in September 2008, just before the collapse. Fitch Ratings last week raised Iceland to investment grade, with a stable outlook, and said the island’s “unorthodox crisis policy response has succeeded.”
We still have ridiculous amounts of housing and consumer debt to deal with in this country, most of it owed to banks whose own policies had much more to do with the creation of the debt than any unreasonableness on the part of the people who are now responsible for paying it back. If we actually want a healthy economy, which strategy should we be using?