Where is Greece going?

The impasse of Greek capitalism, the lessons of SYRIZA and perspectives for the socialist revolution.

[The present document originally called Greek Perspectives 2016 - The impasse of Greek capitalism, the lessons of SYRIZA and perspectives for the socialist revolution was written in the spring of 2016 and approved by the congress of the Greek Marxist organisation Communist Tendency.]

As the end of the second decade of the 21st century is approaching, humanity is experiencing a tragic contradiction. On the one hand, the productive forces – industry, agriculture, technology, science, and so on – have reached unprecedented levels of development, capable of guaranteeing a decent standard of living for every human being on the planet in a way that is sustainable for the environment. On the other hand, however, capitalist relations of production and of ownership are an enormous fetter on the realisation of such potential. This is leading to deteriorating living conditions, exploitation, oppression and inequality; trends that are being experienced everywhere, albeit with differences in scale and speed from country to country.

It is the world situation as it currently is – rather than ‘ideas’, ‘visions’, or abstract theories  – that provides the indisputable evidence as to the necessity of a global socialist revolution.

The crisis that broke out in 2008 placed the world in a new historical period. It began to reveal the true, barbarous, face of capitalism that was hitherto shielded from view. This was the case in both the so-called developed and developing world for more than five decades due to particular historical circumstances and phenomena that have been explained in key political publications and documents of the IMT. Since the outbreak of the crisis we could liken global capitalism to terrain upon which new fractures are increasingly appearing due to regular and repeated tremors.

The fracture that is Greece is just one of the areas that regularly trembles thus unsettling the ground upon which the global economy rests. In and of themselves, the tremors caused by the Greek fracture are incapable of causing fatal damage. However, their interaction with the fractures – whether large or small – of other countries is capable of causing great damage to the global economy. The international strategists of capital are concerned at such a prospect and this is the reason that they are imposing successive ‘rescue’ programmes on Greece.

The international character of the Greek crisis

Despite a range of metaphysical theories as to the nature of the crisis in Greece, it cannot be explained by national particularities. The crisis in Greece is an organic part of the global crisis of capitalism. This global crisis is a classic case of a crisis of overproduction (or ‘overaccumulation’) of capital and commodities. This is due to the fundamental contradiction between, on the one hand, the tendency of capitalism for boundless development of the productive forces. On the other hand capitalism imposes narrow constraints of individual ownership over the fruits of productive processes, due to private ownership of the means of production.

The steady decline of European capitalism after the outbreak of the global crisis began with its ‘weakest links’, one of which is Greece. The tendency to accumulate public debt is a permanent tendency for Greek capitalism. It reflects its distorted and late development compared to industrially developed capitalism in the West. This lateness is a product of historical circumstance rather than due to some particular national predisposition or mentality. In the final analysis Greek capitalism could not have taken another path, given the context of its historical development. This is irrespective of the political choices of various administrations, which would only have determined the particular details of Greek capitalism’s development, not its underlying nature.

Greece’s unbearable and odious external borrowing has historically been the definitive ‘fuel’ for the development of Greek capitalism. This has been used to fund everything from the development of state infrastructure and public works to the development of industrial production. It is no coincidence that the Greek state has historically teetered on the brink of bankruptcy following the outbreak of serious global crises The various phases of boom and slump in the global economy have a decisive impact upon Greek capitalism. This has been the case with the last two instances of the Greek state’s bankruptcy.

Prior to the 1932 bankruptcy of the Greek state, during the premiership of Venizelos, the 1929 crash had taken place in the United States. This caused the global economy to enter the ‘Great Recession’. Similarly, shortly before it became clear that the Greek state was unable to service its debt repayments in April 2010, the global 2008 crisis had broken out. As was the case in 1929, it broke out in the United States and spread to Europe.

If European capitalism had been in a period of boom during 2010, Greece would not have been isolated from the capital markets and would not have negotiated lending agreements. Within a year of the 2009 European slump Greek debt grew from 112.9% to 129.7% of GDP (source: Eurostat). There were similar increases in the national debt of all Eurozone members. However, the interest rate at which Greece was borrowing rose the most, because Greece was the weakest member in terms of its rate of production. That is to say, Greece was the Eurozone member most likely to struggle to overcome the recession. This predictable rise in interest rates for state borrowing was compounded by international profiteering over Greek bonds. This swiftly made borrowing on the part of the Greek state prohibitively expensive, thus leading to the ‘memoranda’ era.

In that respect, it was not ‘Greek’ deficits and debt that caused the crisis. Enormous state debts have been and continue to be a Europe-wide and global phenomenon. They are symptoms of global capitalist crisis. It is the global capitalist crisis of overproduction which leads to a slowdown in the rate of growth and to recession. It transforms debt from a factor that stimulated the economy by artificially creating markets for commodities, into a factor that makes the economy deteriorate further.

It is only in the wider international context –  the general situation in which European and global capitalism finds itself – that we are able to examine and understand the crisis and the current impasse of Greek capitalism. Otherwise we are reduced to foolish moralistic, conspiracy-type, or metaphysical simplifications that selectively isolate particular symptoms (whether actual or imagined) and try to use them to interpret the crisis (e.g., ‘the Greek mentality’, ‘the Greek clientelistic state’, ‘the attack by financial assassins’, ‘the Greece acquisition plan’, and so on).

The fundamental objectives of the lenders

latuff-greek-memorandumImage: LatuffWhat was the fundamental objective of the infamous Troika (the European Commission, the European Central Bank, and the International Monetary Fund) when it granted an enormous lending package to Greece? This is the scheme that the Greek state’s creditors set up with the participation of all key forces of western imperialism. The Troika got involved, not out of some abstract concern for the wellbeing of Greek capitalism, but to protect the big international banks that held Greek bonds. And, more generally, they wanted to defend the stability of European and global capitalism, at a particularly sensitive time during the search for a definitive way out of the global recession.

Capitalist Germany – in its role as the “boss” of the ‘Greek programme’ – has the last say in such matters. As the strongest capitalist force in Europe, and one which benefits greatly from the EU and the Eurozone, Germany is well aware of its interest in leading efforts to resolve crises that break out in the territory of European capitalism. In that sense, more than any other national ruling class, it was the Germans who defined the terms, the form, and the intensity of the programme’s application. It did so according to its own interests and objectives.

However, the content and essence of the ‘Greek programme’ was not merely formulated according to the objectives of the German capitalists; it reflects the actual reality of European capitalism in crisis and the common interests of all European capitalists. The bourgeoisie across Europe is united in its common aim of burdening the European working class with the cost of averting bankruptcy. It is the working class and the impoverished masses of the ‘weakest link’ that has had to pay a heavy price so that the same reactionary offensive can be unleashed on the workers and masses across Europe. That is the essence of the ‘Greek programme’ that has hitherto been expressed in the three lending agreements/memoranda and their respective implementation legislation.

The deep recession has from the outset been associated with the programme. The programme’s content has not been developed with abstract economic criteria aiming to eventually get Greece ‘returning to the path of recovery’. It was developed with clear criteria based on the class interests of the ruling class; specifically, to avoid an uncontrolled default by having the crisis subsidised through deteriorating living standards for the working class and the masses. Naturally this is an outcome which inevitably leads to a deepening of the recession, given the corresponding reduction in consumption. The “error” regarding the infamous tax ‘factors’, to which the IMF is thought to have admitted, is an amusing incident for domestic consumption. All the lenders, all the technocratic strategists, and, naturally, the Greek bourgeoisie, have been fully aware what the outcome of this would be ever since 2010. They were fully aware that the deep recession and mass unemployment, with all the painful consequences for the working masses, were inevitable consequences of the lending agreements.

A ‘neoliberal recipe’?

We should never cease to emphasise that the destruction of working class living standards and the impoverishment of the masses caused by the memoranda is not the outcome of some ‘faulty recipe/formula’. It is a direct consequence of the global capitalist crisis of overproduction from which European capitalism has yet to recover. There is no other ‘formula’ to apply on the basis of contemporary capitalism. Keynesianism is unfeasible when state debt is sky-high. If it were to be adopted, not only would public debt shoot up but so would super-inflation.

Reformists and assorted petty bourgeois charlatans who claim that the problem is the German capitalists’ attachment to ‘dogmatic neoliberal formulas’ fail to understand what capitalism is. Their argument amounts to asking the capitalists of Germany and other European states to be kind-hearted philanthropists. More than that, they hope to convince the capitalists to have a foolish disregard for their own interests by providing and guaranteeing gigantic debts without any gain for themselves. To have such expectations of the vultures of capital is not an alternative formula.

It is only the European working class which would be in a position to show true solidarity and compassion towards the Greek working masses. It could do this by taking power all across Europe and by writing off the debt which it would have no interest in preserving. In other words, the ‘Greek programme’ is a question of class interests and not of ‘ideological formulas’. It was not formulated according to ‘ideological’ criteria. It is class, not ideological motives that are behind it.

In reality, the ‘Greek programme’ cannot even be classified as ‘neoliberal’ within the orthodox and conventional sense of the term. Neoliberalism opposes all kinds of state intervention in the economy, in the interests of preserving ‘market autonomy’. The coordinated intervention of numerous states to prevent the uncontrolled bankruptcy of one state, and the attempts by the strongest European states to artificially preserve the weakest one are by no means in line with the spirit of neoliberalism. That, however, is what has happened so far because as a policy it reflects the common interests of the strongest capitalist powers in Europe at this juncture of the crisis.

The position of the lenders regarding Greek debt

All the international strategists of capital and the more intelligent bourgeois economists admit that it is impossible to service the Greek debt in its entirety. Greece’s public debt according to the official ELSTAT (i.e., Greek Statistical Service) figures for 2015 stands at 321.3 billion euros which is 176.9% of GDP. It is indicative of the overall situation that by 2030 the Greek state would have to spend as much as 300 billion euros in interest payments.

Just in 2016 the Greek state must make capital and interest payments to the tune of 12.5 billion euros, which represents 7.5% of GDP. This is divided up between 6.5 billion euros of capital repayment and 6 billion euros of interest. The amounts are similar for every year up to 2022 when the ‘grace period’ for the interest payments on ESM loans expires. After this the Greek state will have to pay 22 billion euros per year in interest payments alone. This is the reason why certain elements within the Troika – particularly the Germans – claim that the debt is serviceable up to 2022.

In reality however there can be no such guarantee. A number of important variables in the equation would all have to come up trumps for the Troika’s plan to come to fruition. Firstly the recession would have to come to an end; then the increasing inability of the masses to pay taxes would have to be reversed; the relationship between Greece and its lenders would have to improve steadily; and there would have to be political stability in Greece and economic stability in the EU.

In reality, however, the much lauded and celebrated ‘primary surpluses’ (that is to say, the balance between state revenue and expenditure after deducting the cost of servicing the public debt), on the part of the memoranda/austerity governments, which is supposed to guarantee the repayment of the debt, are fictitious. Such ‘primary surpluses’ are a product of the state suspending payments with respect to a variety of other obligations. For instance in 2015 the government announced a primary surplus of 0.7% of GDP – i.e., 1.1 billion euros – whilst at the same time defaulting on debt owed to private creditors of the Greek state to the tune of about 5.4 billion euros last February.

If European capitalism had managed to recover effectively from the 2008 crisis then the problem of debt could have been properly dealt with. Thanks to the ‘rescue packages’, the EU states that now own Greek debt after taking it over from private banks would have had strong primary surpluses. Their own public debt would also have been smaller, and they would have been in a more comfortable position to accept a dramatic ‘haircut’ of the Greek debt thus sparing the Eurozone a source of great instability.

However, recession or extremely low rates of growth are on the order of the day in the EU. According to Eurostat GDP in the Eurozone rose on average by just 1.5% and across the EU by 1.8% in 2015. At the same time it is not just Greece on the brink of bankruptcy due to high public debt. A whole series of European states, such as Italy, Portugal, Ireland, even France, are in the same boat. This is the case even despite the artificial preservation of low interest rates due to ‘quantitative easing’ on the part of the ECB, which cannot last much longer in any case. In this context there can be no ‘generosity’ with regard to the Greek debt.

A drastic cut to the Greek debt would have involved a significant direct cost to several states currently in endless recession, because they would have lost the capital they had lent to Greece. But, more importantly, even more damage would have been done to the stronger EU capitalist states in the intermediate and longer term. Forgiving a large part of the Greek debt would have led to an expectation on the part of other super-indebted EU members that they would receive similar treatment with regard to their respective debts. It is awareness of these costs that is behind the intense frustration and prevarication on the part of Germany and its ‘satellites’ in northern and central Europe, despite the evident need for a drastic solution to the Greek debt situation.

The unwillingness to take drastic measures to manage the problem of the Greek debt, due to the generalised recession and indebtedness within the EU, is reflected in the targets for fiscal surpluses. These are completely outlandish in the context of modern capitalism. For example, the target in the 3rd memorandum is for a surplus of 3.5% in 2018. Such targets are publicly questioned even by the IMF, and to achieve them what’s needed is enormous cuts that would exacerbate recession. That, in turn, would necessitate additional measures (such the infamous 3.6 billion euro supplementary package) which would still be insufficient to break out of this vicious cycle.

Six years since the outbreak of the crisis in Greece, not a single lender really believes that the Greek state will be able to enter the ‘path of growth’ and be in a position to service its debt. Every lender, whether publicly or privately, admits that in order to reduce the risk of ‘contagion’, drastic measures such as a ‘haircut’ on the debt will be necessary at some stage. But all they have achieved so far amounts to ‘buying time’ without any specific plan. They are merely postponing the necessary drastic measures to some unspecified future time, whilst increasing the squeeze on the living standards of the workers and impoverished layers of society.

On the issue of the debt, the various lenders appear to have different assessments. This is just a matter of different tactics, which is of no material importance from the point of view of the class interests of the workers and the impoverished masses. The German ruling class and its ‘satellites’ are currently unwilling to discuss the ‘haircut’ of the debt for the reasons explained above. They are in favour of extending the loan repayment period and reducing the interest rates with the aim of buying time. This method, however, provides no substantive solution. By delaying the repayment of the debt this also delays the eruption of the instability of the ‘Greek threat’ onto the scene of European and global capitalism.

The IMF reflects the more distant lender’s perspective, in comparison to the leading role played by Germany. But it also reflects the more technocratic character of its participation in the ‘Greek programme’, as well as reflecting the anxieties of the non-EU IMF member states who are worried about Greece remaining a constant source of economic instability. Consequently the IMF misses no opportunities to openly warn that drastic assistance to Greece is necessary; in other words that a haircut to the debt is needed. Naturally, there is nothing progressive about their position given that it is accompanied by the most harsh attacks against the living standards of the masses. This is needed to gain support for a debt ‘haircut’ and to safeguard the eventual payment of the remainder. However, given that the owner of the Greek programme is Germany, a ‘haircut’ is certainly not a possible immediate option.

The present situation regarding the Greek debt cannot continue for much longer. This debt is not viable, it cannot be serviced regularly, and it amounts to an insufferable burden on the weak back of Greek capitalism. Every sharp turn in the course of European and Greek capitalism poses the question of a drastic reduction of the debt. Greece, with its current level of public debt, will remain on the brink of bankruptcy, which represents a constant threat to lenders and to global capitalist stability. For as long as lenders shut their eyes to the issue of Greek debt, they will continue to be exposed to a sudden default.

Lenders, the Eurozone, and ‘Grexit’

The possibility of Greece exiting the Eurozone – the so called ‘Grexit’ scenario – has been raised since the outbreak of the Greek crisis. All the lenders and their strategists, since the outbreak of that crisis, have realised a truth that Marxists have known and have explained for a long time, since before the Eurozone was even constituted. Namely, that it is impossible to unite economies which are so far apart in their productive capacity under a common currency for any long period of time. With the outbreak of a serious crisis the cost of a common currency proves unmanageable.

The Eurozone came into existence at a time of relative boom for western capitalism which was principally due to capitalist restoration in the USSR, Eastern Europe and China, with the associated expansion of global trade. German capitalism promoted the creation of the Eurozone as a means to develop its dominance over Europe and thereby to raise its standing globally. It was supported in this by the stronger European capitalists due to the greatly advantageous position of being able to trade in a strong and stable currency. This approach was remarkably short-sighted. It could be said that they were blinded by the immediate prospect of new profits guaranteed by the Eurozone and, as is the case historically with all capitalists during periods of boom, therefore failed to identify future risks. The outbreak of the 2008 crisis brought those risks to the surface.

Up to that point the Maastricht Treaty and its formal acceptance by all EU member-states appeared to guarantee the bloc’s cohesion. In reality however the treaty had already been set aside, given that 20 out of the 27 member-states at the time had budgetary deficits above those permitted by the treaty. Even those members at the heart of the Eurozone – including Germany and France – were setting a ‘bad example’ with their debt and deficit outside the ranges provided for by the treaty. The explanation of those violations is the efforts of European capitalists to artificially extend the boom through debt. This includes state debt necessary to maintain a certain level of state intervention in the economy as an investor, employer, and procurer of goods and services. When this debt-fuelled growth subsided and the recession and risk of default loomed, the common currency began to present not just advantages but also serious disadvantages as a link between states/economies with wildly differing levels of debt.

For the German ruling class and its northern European satellites the euro began to mean increased lending to the super-indebted members of the Eurozone. This included responsibility for underwriting the debt of the latter and generally to be embroiled in their problematic economic futures. But for the rest of the Eurozone members, particularly the super-indebted states in the South, the euro increasingly became expensive. Its capacity for more competitive trading was questioned, it become a synonym for the endless austerity programmes that are increasingly alienating the middle class from the capitalists, and a synonym for recession itself.

The euro began, therefore, to be seen with scepticism by the European bourgeoisie. But the misgivings are not yet public or overwhelming. This is thanks to the titanic intervention on the part of the European Central Bank. The ECB averted a deep recession in the EU by preventing a series of bank and state bankruptcies. Despite all the misgivings, the German and other European capitalists are unwilling to give up the common currency without a fight. They fear that dismantling the Eurozone would trigger waves of instability capable of dragging down the entire European and global capitalist economy.

Despite that, European capitalism is already in a very deep crisis. The European economy, despite all the ‘rescue’ attempts and the ‘quantitative easing’, finds itself now in a worse state than it was in before the crisis. The most revealing figures relate to the public debt. In 2008, the year that Europe entered crisis, public debt of the 19 Eurozone members stood on average at 68.5% of GDP. In 2015 this reached 90.7% of GDP.

The situation of the four members of the Eurozone which have embarked upon the bailout ‘programme’ is highly instructive, as are the cases of Italy and Spain which came very close to entering into such programmes. We have already reported the situation with the Greek debt. Portugal is held up by the propagandists of the ruling class as an example of a successful exit from the crisis. In 2008 the debt of Portugal was at 71.7% of GDP. In 2015, following its ‘successful rescue’ its debt reached 129%. The same has happened with another ‘successful rescue’ example: Ireland. In 2008 Ireland’s debt stood at just 42.4% of GDP. In 2015 it reached 93.8%. An ‘equally successful’ case is that of Cyprus, which in 2008 had a debt of 45.1% of GDP, yet in 2015 this reached 108.9%. Italy’s debt in 2008 stood at 102.3% of GDP and by 2015 this had risen to 132.7% - greater than that of Greece when it signed up to the memoranda. Lastly, Spain’s debt in 2008 stood at 39.4% of GDP and by 2015 this had risen to 99.2%.

Given that there appears to be no substantive way out of this crisis, sooner or later, the current nascent scepticism towards the Euro will turn into open doubt. This will provide the basis for some serious clashes between the European ‘partners’. The mood for protectionism in national economies will gain ground at the cost of any concern for ‘common European matters’ such as the Euro. Faced with the ‘Schoeble plan’ of last summer for an ‘orderly Grexit’, all the facts and events indicate that we are steadily moving towards that situation. We have the rise of bourgeois Eurosceptic parties and political voices; the UK referendum on the EU; the discussions in the Finnish parliament about the possibility of a referendum on the issue of a Finnish exit from the Eurozone and so on.

Against the backdrop of this general context, it is ludicrous to suggest that the memoranda have secured Greece’s place within the Eurozone. Greece, within the general context of a slump of European capitalism, appears, more so each day, to be an ‘incurable patient’. Greece’s continued presence in the Eurozone will mean for Germany and the other strong economies in the EU, the assumption of responsibility for perpetual cheap lending and constant ‘assistance’ with the debt of the former. The appearance of the ‘Schoeble plan’ last summer was not coincidental. It reflects the fatigue of lenders at Greece’s inability to recover and a cold calculation that the possibility of temporary instability of the Eurozone, caused by Grexit, is preferable to having Greece as a perpetual source of instability within the bloc. The open expression of this fatigue, given the development of the crisis of Greek and European capitalism, inevitably points to Greece leaving the Eurozone. Of course this is with the hope that it would happen in an ‘orderly’ consensual manner, with the full agreement and cooperation of the Greek ruling class, and also with the other Eurozone partners.

The excessive inflexibility and harshness exhibited by the German ruling class and its satellites towards Greece cannot be explained away simply as the need for them to send a message to the rest of the super-indebted states and the European working class. Insofar as lenders are persuaded of the inability of Greek capitalism to recover, they will continue with tactics designed to force the Greek government itself to ask for an ‘orderly Grexit’ as a means of bringing to an end the imposition of the memoranda.

As much as the Greek ruling class is currently swearing by the Euro, it is not immune from the general scepticism developing towards it. The entry of Greece into the Eurozone was undoubtedly an important achievement for the Greek ruling class. By exporting profits and boosting hard currency reserves, the Greek ruling class raised its status globally whilst the banks and big businesses gained access to cheaper lending. This alone is sufficient to explain why Greek capitalists remain fanatical defenders of ‘Europe’ and of the Euro.

However, all these advantages of the Euro don’t mean that the Greek bourgeoisie will remain in favour of the Euro whatever the cost. The permanent recession; tax increases to service the loans; constant social and political instability; the absolute and asphyxiating control of the lenders over the finances of the Greek state (previously a source of loot for the Greek bourgeoisie); privatisations favouring the lenders’ national businesses at the expense of Greek ones; and the inability to competitively devalue the currency are all matters that concern a large section of the Greek ruling class. After all, it was this, rather than a tendency towards demagoguery, that was the basis for the development of ‘anti-memorandum’ political currents within the bourgeois camp. The most authentic representatives of this current were the Samaras leadership of New Democracy up to 2011 and the ‘ANEL’ (Independent Greeks) party.

The certain failure of the new Greek programme is likely not only to cause fatigue for the lenders but also for the Greek bourgeoisie. In those conditions the pressure of the lenders for the acceptance of a new ‘Schoeble plan’ is very likely to be met with the acceptance of the Greek bourgeoisie. In order to accept such a plan, it is very likely that tempting concessions would be offered. These would be along the lines of a ‘haircut’ of the debt (which would have been unavoidable at some future point anyway); some sort of ‘investment’ and ‘social’ package; and so on. In any event, in order for this to be accepted there would have to be a sufficiently wide agreement between the major parties. A return to a national currency would also appear dressed in the cloak of national independence in an attempt to re-integrate the petty bourgeois masses into the bourgeois camp, thereby recovering part of the stability for the bourgeoisie that has been lost in recent years.

It should be highlighted that a return to a national currency would mean even greater difficulties for the Greek working class and the impoverished layers of society. It would result in reduced purchasing power, inflation and increased unemployment, at least for a period, due to the inevitable capital flight. That is why, within the Left and the labour movement, it is reactionary to raise the banner of the return to a national currency. To replace the need for a transition to socialism with the need to transition from one currency to another only pushes the working class in the arms of its class enemy.

A "debt colony"?

The similarities with colonial patterns that have appeared in the relations between the lenders and the Greek state is an indisputable fact. Through the imposition of the memoranda the lenders are responsible for economic exploitation and political oppression that is reminiscent of the relationship between colonialists and a colony. Austerity measures have been imposed on the Greek workers in order to service debt held by dozens of states; all Greek state property is tied to a fund controlled by these lenders; every law must obtain the approval of the lenders’ technocrats before it can be adopted by the Greek parliament; all major policy decisions on the future of the country are taken in the Eurogroup or, more accurately, in closed meetings during the official Eurogroup meetings, between the representatives of the most powerful states.

Given all this, could we characterise Greece as a 'debt colony'? The use of a term when it comes to specific economic, political or social phenomena should correspond as closely as possible to its scientific definition. With this as a basic criterion, the term "colony" is not appropriate to define present-day Greece. Instead of clarifying the nature of the phenomenon that it wants to identify, this term creates confusion and has a series of political implications.

The term “colony” corresponds to a particular historical period - a certain stage in the development of capitalism. A colony is a society with very low level of development of the productive forces. Its raw materials and agricultural products are, in reality, stolen thanks to the low prices set by the capitalist nations, thus exacerbating the trend towards underdevelopment of industry. The tasks of a bourgeois-democratic revolution in a colony are not achieved. The land is heavily concentrated in the hands of a small number of people. There is no independent constitution for a recognised nation-state. Urbanisation has progressed very little and the vast majority of the population lives in the countryside. The rural masses are the vast majority of the population. The working class is a minority and has an extremely weak social role. The indigenous bourgeoisie is also very weak and organically connected with the landowning class. Bourgeois parliamentarism has not yet made its appearance in political life. Its inhabitants suffer national oppression (linguistic, cultural, religious, etc.) imposed in a direct way through military occupation by the advanced capitalist nations.

It is clear that today's Greece, despite the economic exploitation and political oppression of the lenders, is not a colony. Any old form of economic exploitation and political oppression does not indicate the existence of a colony. Greece is a state that even today, after seven years of continuous recession, is among the more developed countries of the Western capitalist world. The key bourgeois-democratic tasks, as explained in the wonderful book "Democratic or socialist revolution in Greece?" by Pantelis Pouliopoulos, have been carried out by Greek capitalism ever since the inter-war period. This was done in a peculiar manner, which matches the conservative spirit of the Greek bourgeoisie. And it was done with considerable delay compared to the rest of developed capitalist Western Europe.

If the use of the term "colony" in the labour movement and the Left was confined to agitation then this would not be a big issue. But this is not the case. The term is used in the context of a particular political viewpoint which has clear political goals. Left reformists use it to justify their allegiance to reactionary patriotism and their commitment to a Popular Front policy which rests on a defence of bourgeois democracy.

The most important political task in a colony is national liberation and the conquest of democracy. According to the reformists, these tasks can be achieved only through an alliance with the national bourgeoisie as a progressive step forward on the basis of capitalism, which must come before the socialist transformation of society. Thus the point the reformists raise, that Greece has been converted into a colony, serves to replace the programme of the international socialist revolution with the tasks of a national democratic revolution.

Revolutionary Marxists have a duty to fight and expose the unsubstantiated theories of reformism, which serve as a policy of class collaboration - i.e. as the open betrayal of the working class and socialism. It is not a coincidence that the term "debt colony" acquires its theoretical justification from the current Minister of the SYRIZA-ANEL government N. Kotzias in a book published in 2013 with the same title. The fact that this gentleman has an illustrious career today as a leading minister in this "debt colony" is more than just ironic. It is a living testament to the deeper, treacherous nature of his views to the cause of the working class.

In Greece there is currently not a trace of a progressive national bourgeoisie. The Greek bourgeoisie is in a common reactionary bloc with its lenders. It thus attempts to achieve the maximum exploitation of the Greek working class and to maintain its status internationally. Within this bloc the Greek ruling class has a politically and economically inferior position to the strongest of its lenders, due to the fact that the state and its banks are financially dependent on them. On top of that the Greek position in the Eurozone depends on the goodwill of the lenders. The economic exploitation exercised by the lenders has victimised only the workers, whom the Greek bourgeoisie exploits along with its lenders. Political repression is directed exclusively against the rights of the working class and the poor. The bourgeoisie meanwhile have willingly subordinated themselves to the political domination of the lenders because that works in their class interest.

Today Greece is not any kind of "colony". It is a developed capitalist country which is constantly on the verge of an uncontrolled state bankruptcy; whose position in the Eurozone has been undermined; and which is dominated by the foreign lenders’ bloc and the Greek capitalists. Only the working class can remove the economic exploitation and political oppression by the lenders and their allies, the Greek capitalists. The road to this is the seizure of power and the beginning of the socialist transformation of society. This requires international solidarity with the European proletariat and the building of the United Socialist States of Europe. By contrast, the "patriotic road" on the basis of capitalism is the path of increasing exploitation and oppression of the working class, who are being sacrificed on the altar of the "national interest", i.e. the interests the reactionary Greek capitalists.