Papandreou Steps Down; "Unity Government" Formed

Papandreou set the ball rolling on Monday with a shock announcement that Greece would hold a referendum on the terms of its October bailout deal which calls for further fierce austerity measures.

The move stunned fellow European leaders, sent global markets into a tailspin and earned the Greek prime minister a humiliating dressing-down by France and Germany on Wednesday ahead of a G20 meeting.

Hastily retracting the proposal, Papandreou then turned disaster into temporary victory by winning a nail-biting confidence vote early Saturday by offering to step down in favour of a unity government.

The Greek people, meanwhile, battered by two years of stringent austerity measures that have crippled the economy and sent unemployment soaring, appear to have had more than enough of their squabbling leaders.

"The people are suffering at the moment and they [politicians] are not budging," said Marianna, a shopkeeper.

"A unity government with whom? With the same people? We will have the same results," she said gloomily.

"Papandreou. Samaras. They are all the same," said Takis Karalambos, as he sipped coffee outside a market in Athens.

Read the rest of the Al Jazeera article here.

The call for a referendum on the brutal EU austerity proposal set off a firestorm among EU leaders, all of whom have severe cases of "demophobia". The European ruling class made their disgust known as well as markets plummeted after the announcement of a referendum was made.

But no sooner than Papandreou had announced the referendum, he'd retracted it in favor of an arrangement favored by the EU, particularly the French and German governments: form a "unity" government with the Right-wing parties in parliament in order to more effectively push through the brutal austerity measures recommended by the EU proposal.

Of course, Greece is a capitalist country. That is to say, Greece is not democratic in any genuine sense --the control of the means of production (and all of the social and political power that this ownership and control entails) is private rather than democratic. But even the political realm --where ostensibly democratic parliamentary processes prevail-- recent events prove that there is no real democracy.

Think about what's happened. The EU ruling elites, who are looking first and foremost to protect their profit-seeking investments in Greek debt, were horrified when they learned that their favored policies would be submitted to the Greek people for approval by way of referendum. They were horrified both because the masses of Greek workers would have a voice in policy and because they knew that Greek workers, quite reasonably, would value their own standard of living more highly than the profit margins of the EU ruling class.

The vitriol of the EU ruling classes has now been translated into concrete consequences. Papandreou called off the referendum after being openly and explicitly excoriated by the political represntatives of European Capital, particularly Merkel and Sarkozy. And, following their lead, a "unity" government is being formed with the Right (who, predictably, is far more aggressively pro-austerity than PASOK).

Here we see the capitalist system for what it truly is. It not a system sensitive to the needs and interests of ordinary Greek working people, for it is administering deep cuts to their standard of living. It is not a system that allows the majority of the population to have a voice in decisions that have huge effects on their lives, because the recent strong-arming of the EU proves that the will of Capital prevails over the will of the Greek people. Read the financial papers --in Greece, democracy is the enemy and the rule of technocratic EU elites is the solution. And neither is capitalism a system that is rational, since it is undermining itself by eroding the conditions for future capital accumulation by pursuing austerity.