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The IMF's shadow
by Thanos Kalamidas
2010-05-25 07:13:12
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It looks like the minute the International Monetary Fund put a foot in Greece cannot keep away from Europe and now with a new force warns Spain – they called it concerns - for problems and the time has come for some radical measures to ensure economy’s recovery. And Spain seems to follow Greece in the borrowing game unable to pay the public sector with just an income coming from tax.

The same time unemployment in Spain has reached 20% rising dramatically day by day and all that while the German chancellor tours around the Arab countries trying to promote German products and a private security company – I suppose mercenaries is the correct word but in the political correct times we live … - has taken over the German diplomacy taking part in the Somalia’s civil war. The new British prime minister with a little help from the economic ministries talks about serious cuts and the same time warns that he will not tolerance any extra favours to the Euro-zone countries compared to the other EU members something that shows how much he’s worrying for the financial future of the Union. Nicolas Sarkozy keeps referring more and more often to the economic crisis and the need of a political union in the EU and Berlusconi keeps meeting his financial adviser trying to find out a solution for a reality not even his personal charm can cover.

But let’s go back to Spain. Spain was like intoxicated the last decade with the construction sector having an orgasm. If you had visited the country during the nineties you would have notice that there were construction sites just everywhere and I’m not talking only about houses and huge apartment blocks. Bridges, motorways and cities were built and rebuild. The construction sector managed to lead the Spanish stock market, even beating banks and investing portfolios and what Greece did during the preparing time for the Olympics, Spain did it for more than a decade. Unemployment was running low and people were happy, there were jobs and they thought there were money. A small detail, there were no money. The government was borrowing money, the construction companies were borrowing money, and the consumers were borrowing money. And the borrowed money finished and the interests rise.

But what I find fascinating about both cases, Spain and Greece, is that the first suggestion IMF has come with is that the Spanish labour market is not working and needs reform of pay bargaining and lower payments for hired and fired workers. And of course in front the serious crisis and the fear to turn into another Greek drama only this time it will be the Spanish drama, the Spanish government is thinking the news and starts finding ways to enforce them with the lowest political cost. In the meantime the workers in Spain and all around Europe they are more than ready to sacrifice everything they earned with blood the last centuries for the …common good.

But why? Of course Spain just like Greece is representative democracies they elect their representatives and their governments and they give them the decisions right, but they do so faithfully believing two things, first of all that all these representatives of the public are there for the good of the people and secondary that they are experts on what they are doing including the financial prosperity of the country and if the leadership hasn’t got the right skills, they got the right to employ the ones who do. In theory anybody can be a candidate but we all know that things are not so simple. So how it happens that all these experts and academics, respectful otherwise professors and experts in their fields fail in basics. Is it because power corrupts, have they been lying all this time or there is something wrong in general and that’s why it is time for a global political unity and financial understanding beyond micro-economic and contemporary interests.

And then what the role of the IMF? The International Monetary Fund suppose to be there to advice and guarantee that the loans one way or another will be return not force economic measures and establish a financial governing reality that reminds dictatorship forcing one-sided measures that leave the privilege out of the hook and hooks the workers and the non-privilege. As a result of all that any reaction however violent from the Spanish, the Greek people and who knows who else in the future will be at least understandable. In a few weeks the ITM in Greece killed every right the workers have and anything – not privilege but humanly obliged to them from the society – these people earned in decades of hard straggling and a lot of blood. Nowadays the eight hours work seems to be a luxury, even the right to have a work seems to have a luxury since every one has turned into acceptable casualties to what aim? To establish and guarantee the prosperity of the bankers and the industrialists? Because with all those measures the small businesses are dead. Instead of funding the bankers and the industrialists with the money they take from the workers shouldn’t they help the workers to revive the market? And please don’t tell me that healthy banks and industrialists means less unemployment because the Spanish 20% and galloping Greek numbers to similar heights don’t show that. 

IMF has a lot of suggestions and that is fine as long we understand that IMF represents a certain economic philosophy that is not necessary the only solution and I’m afraid that this is what the Spanish and the Greek leadership missed and if president Obama wants more control to the banks and the international financial institutes he must have a look at the American interests IMF and the political role they play in the international scene trying to become the major puppeteers.

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