Greece: Strikes Undermine Austerity

From a moral point of view, it is difficult to say whether the efforts of Greek unions to shut down the nation’s economy are ethical. From an economic viewpoint, it is not. Massive walkouts slow economic activity and gross domestic product suffers. Greece’s deficit is bound to rise, and along with it national debt. And those activities put further pressure on Greece to increase austerity programs to get the financial aid it so desperately needs from the European Union, European Central Bank and International Monetary Fund. Those austerity measures claim more jobs and further infuriate organized labor.

For close to a century, organized labor has been a balance to corporate efforts to put profit entirely ahead of the financial needs of workers. After decades of sometimes violent battles, most labor disputes in the developed world are settled through long and complex negotiation, with occasional nonviolent strikes. The unions can claim they were on the right side of the situation because workers were so badly treated.

National strikes are an entirely different matter. There is no single union boss to approach for negotiation. The strikes are over the political decisions about government cuts, but at their heart they are cousins to other labor movements. They are about jobs and benefits, and philosophical issues are barely if ever a part of what triggers them.

Greece is about to be hit by another national walkout that will partially close businesses, both public and private, in the nation’s largest cities. While it would be hard to say exactly what this will do to a country with nominal GDP of less than $300 billion, which is shrinking at an estimated rate of 6% a year, the hurt done will cause Greece to ask for a larger bailout, or larger cuts to government activity that already has been slashed to the bone. That leaves strikers in part as the cause of the destruction of their own jobs.

The labor movement in Greece must assume that its neighbors will bail it out no matter what. That means Greece is essential to the fate of the EU. Or, the strikers may believe that Greece can leave the unions without terrible financial consequences. Both beliefs are faulty. The bailout negotiations with Greece have stalled again. If they are not restarted, Greece may fall or be pushed out of the alliance. On its own, while it may recover eventually, the country is likely to go through its own great depression. Unemployment, which is at nearly 25%, could go much higher.

The leaders of Greece’s unions ought to consider more closely the extent to which they are cutting their own throats and those members who could be out of jobs for years..

Douglas A. McIntyre