Athens News: Why so much emphasis on austerity and internal devaluation?
Michael Hudson: This is because financialisation brings the class war back, in a new way. For the last 100 years the social divide was between employers and employees fighting for workplace rights, higher wages and so on, but once you bring in the financial sector, this adds a new dimension to their struggle. Once creditors take control of governments and unions, they push austerity and unemployment that drives down wages on a macroeconomic “financial” level to a degree that could not occur before. In the US, workers are in debt and afraid to go on strike, afraid even to complain about working conditions, because if they are fired and miss a payment in their electricity or mortgage bills, they are one paycheque away from homelessness. So what’s happening in Greece is happening in America too. We have government-sponsored wage cuts and abolition of labour rights in ways 19th-century industrialists never dreamed of.
Full interview here.