Ludwig von Mises Institute of Canada

What happens when two groups used to having the guns of government as their backing start disagreeing?  From Reuters:

(Reuters) – Greece’s largest police union has threatened to issue arrest warrants for officials from the country’s European Union and International Monetary Fund lenders for demanding deeply unpopular austerity measures.

In a letter obtained by Reuters Friday, the Federation of Greek Police accused the officials of “…blackmail, covertly abolishing or eroding democracy and national sovereignty” and said one target of its warrantswould be the IMF’s top official for Greece, Poul Thomsen.

From the austro libertarian perspective, it’s hard to know who to root for in this instance.  On one hand you have a government police force which uses the fine art of collective bargaining (read: the threat of violence to achieve higher wages, restrict entry to competition, and in some cases, the outright physical abuse of “scabs” or men who wish nothing more than to work in place of another man who refuses to accept a given wage) to suck Joe Taxpayer dry for a service he could easy obtain on a free and open market.  And then you have the International Monetary Fund which acts as a type of blackmailing force by major governments to try and impose top down measures for distressed states to bring budgets into balance for the sake of acquiring funding.  This doesn’t get to the heart of the matter however as the IMF acts as a lender of last resort and perpetuates moral hazard for the political class.  Also as Henry Hazlitt pointed out in 1963, the IMF “has proved, in practice, a gigantic machine for world inflation. In the nearly 20 years of its existence, more and greater devaluations have occurred in national currencies than in any comparable period.”

So in the sphere of potentially choosing between the lesser of two evils, who could be seen as more in the right here?  Greece has spent roughly the past two years in austerity due to being bailed out in order to remain in the Eurozone.  The Greece police force who, along with their fellow public sector workers, has certainly had it with cuts in salary and pensions.  But of course it was because of the generous retirement benefits that Greek government spending has skyrocketed.  According to the New York Times, as of March 2011, 580 job categories were identified as warranting early retirement due to hazardous working conditions.  This early retirement age comes in at an astounding age 50 for women and 55 for men- so much for the egalitarian notion of treating genders as equals.  Though the hazardous job categories includes occupations like coal mining and bomb handling, it also covers:

radio and television presenters, who are thought to be at risk from the bacteria on their microphones, and musicians playing wind instruments, who must contend with gastric reflux as they puff and blow.

Somehow I fail to see the dilemma of wind instrumentalists not being able to retire early.

This IMF vs. the unionized Greece police force is very reminiscent of the recent debacle between the Wisconsin government and public sector workers in the United States as newly elected governor Scott Walker sought to eliminate their collective bargaining rights (with the exception of police and firefighters because they happen to have given him generous campaign donations).  At the time, Walter Block welcomed the fight as it would only decrease the power and influence of both sides in the long run:

I favor the union thugs, not the government thugs. For me, it’s like Stalin versus Hitler: a pox on both of them. But, I like to root for the underdog, the weaker of the two bad guys, and that’s the union in this case. I do so because I want the fight to long continue, so that both are weakened as much as possible. The state has more guns, better public relations (they have bought off more journalists, intellectuals, clergy, and others of Hayek’s “second hand dealers in ideas”) than the unions.

In this case, the Federation of Greek Police can be seen as the underdog for challenging the NWO and faceless institution of the IMF.  As bad as democracy is, top down authoritarian rule attempting to maintain the inherently unstable banking system otherwise known as fractional reserve banking isn’t much better; especially when it imposes higher taxes.  Yes, government spending in Greece needs to be cut drastically.  Yet the real solution for the financially distraught country is outright default for the creditors ignorant enough to lend to the profligate government in the first place.  The IMF is demanding some reforms that could go a long way in fixing Greece’s finances but there is no reason it has to be holding a bag of taxpayer bailout money over the country’s head.  Given the lack of action on the part of lawmakers to impose the necessary cuts, this exercise in prolonging the inevitable default does nothing but ignite hatred between both sides.  This hatred will not likely manifest into the much needed change Greece needs, such as a dramatic relaxing of workplace regulations, but is revealing of the leech-like nature of the country’s public sector unions and the banker class’s incredible influence over national governments.  The longer the fight goes on and the more people who realize this dynamic, the better.

James E. Miller holds a BS in public administration with a minor in business from Shippensburg University, PA. He is the Editor in Chief at the Ludwig von Mises Institute of Canada and a current contributor to his hometown newspaper, the Middletown Press and Journal.

Tags: Eurozone Crisis, Greece, IMF