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April 21, 1967 Shock Opportunism and the Greek Junta

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April 21, 1967 Shock Opportunism and the Greek Junta Yannick Verberckmoes 00903164 Master Program in American Studies Academic year: 2013-2014 April 21, 1967 Shock Opportunism and the Greek Junta Supervisor: Prof. Dr. J. Ken Kennard In this thesis we will investigate the concept of shock opportunism relating to the Greek colonels’ regime, that governed Greece from 1967 to 1974. Shock opportunism is defined as the use of a possibly premeditated collective shock, e.g. a natural disaster, war or coup d’état, as an opportunity to radically implement neoliberal economic reforms. On the one hand we will look at why and how this was done and on the other, we will link the case of Greece to similar examples of authoritarian regimes during the Cold War to come to a better analysis of this dark period in Greek history. Although writing a thesis is a very solitary endeavor, its merits can never be accredited to just one person. I would therefore like to express my gratitude to the following people: Prof. Dr. J. Ken Kennard: for yelling at me for about thirty minutes one week after the Easter break and explaining to me in quite straightforward English that my first draft still needed a lot of work, as this was a testimony to the great care and effort he displayed in helping me throughout the research and writing process. Prof. Dr. Victor Gavin: for his useful advice. Gizem Özbeko ğlu: for her undying support and access to the library of Boğaziçi University (Istanbul). Both of which were absolutely essential to the completion of this dissertation. Jannik Held: for introducing me to Naomi Klein’s book The Shock Doctrine over a couple of beers. Brigitta Van Der Jeught: for her careful correcting of spelling mistakes. 2 Contents Introduction........................................................................................................................................6 Chapter One: American Control over Greece in the Larger Cold War Context ......................................9 Long-term insurance ..................................................................................................................... 11 Conservative stability .................................................................................................................... 13 Chapter Two: The Threat .................................................................................................................. 16 Center Union and developmentalism ............................................................................................ 17 The army belongs to the nation..................................................................................................... 19 Cyprus........................................................................................................................................... 20 Aspida conspiracy ......................................................................................................................... 21 Chapter Three: The Shock. The Colonels and the CIA......................................................................... 24 The coup ....................................................................................................................................... 27 The American reaction .................................................................................................................. 29 Sensory deprivation ...................................................................................................................... 31 Economic shock therapy ............................................................................................................... 34 The shock wears off ...................................................................................................................... 38 The shock that ended the Colonels’ regime ................................................................................... 39 Conclusion ........................................................................................................................................ 42 Bibliography...................................................................................................................................... 45 3 4 5 Introduction The aim of this dissertation is to look into why shock opportunism was applied by the Greek colonels’ regime, that ruled Greece from 1967 to 1974. The term “shock opportunism” is based on Naomi Klein’s concept of the “shock doctrine”, as explained in Klein’s book under the same title. Klein’s theory is that neoliberal economic policies are very often applied after a collective shock such as a natural disaster, a military coup, a war, etc., which Klein illustrates by means of a host of historic examples. The definition of the shock, in Klein’s words, is “a gap between fast-moving events and the information that exists to explain them.” (Klein 2007: 458) This lack of knowledge about what is going on is key to neutralizing any popular resistance to the implementation of neoliberal economic policies, which essentially mean: privatization, tax cuts, decreased spending in the public sector and deregulation. In order to maximally capitalize on the effects of a shock, these policies are issued within a very small time frame. A process that is known as economic “shock therapy”. (Klein 2007: 7) One of Klein’s examples is the collapse of the Soviet Union in 1991. Boris Yeltsin used this shock to carry out significant economic reforms that brought Friedmanism to Russia and plunged it into a decade of chaos. Yeltsin’s policies had the typical results of wiping out the middle and lower classes, while a select few made fortunes. As Klein writes, “By 1998, more than 80 percent of Russian farms had gone bankrupt, and roughly seventy thousand state factories had closed, creating an epidemic of unemployment. In 1989, before shock therapy, 2 million people in the Russian Federation were living in poverty, on less than $4 a day. By the time the shock therapists had administered their ‘bitter medicine’ in the mid-nineties, 74 million Russians were living below the poverty line, according to the World Bank.” (Klein 2007: 237-8) When shock therapy is undertaken by authoritarian regimes, they usually rely on systematic torture to thwart popular resistance. This was, for instance, the case in Chile under the dictatorship of Pinochet, but as we will see, it was also one of the main characteristics of the colonels’ Greece. The problem with Klein’s theory, however, is that she fails to adequately define it. The closest she comes is to quote Milton Friedman, one of the founding fathers of neoliberalism, as he observed that “only a crisis –actual or perceived- produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.” (Friedman 1962: 2) Secondly, the use of the word “doctrine” is framed by Klein in a linear historic narrative that accounts the rise of neoliberalism from the teachings of an obscure Friedrich Von Hayek to world domination. As Klein writes, “The history of the contemporary free market – better understood as the rise of corporatism – was written in shocks.” (Klein 2007: 18-9) Given that this is a simplification of a process that is far more complex and haphazardly in nature, we would prefer the term “shock opportunism”, since an economy can only be turned neoliberal if conditions allow it. Shock opportunism can thus be defined as the use of a possibly premeditated collective shock, e.g. a natural disaster, war or coup d’état, as an opportunity to radically implement neoliberal economic reforms. As Greece was not 6 mentioned as an example of the shock doctrine in Klein’s work, we will show how this case serves to both demonstrate her point and prove its shortcomings. When looking at this particular period in time, we need to take into account the larger Cold War context (i.e. the position of Greece as an American client-state), the regional context (i.e. the relations of Greece with its neighboring countries, specifically Turkey, and Europe), and the Greek domestic context (i.e. the political forces operating within Greece). In the first chapter we will therefore look at the broader Cold War context paired with the Greek political context in order to comprehend which political forces were operating in Greece. The story begins with the Greek civil war (1945-1949), which brought about the arrival of the United States on the shores of Greece so as to help a conservative establishment defeat communist guerillas. By the term “establishment” is meant: an oligarchy of the Greek economic elite, Greek conservatives and the monarchy. A second clarification needs to be made concerning the Greek communist resistance. “Communist” in this case does not signify that it received support from the Soviet Union. Following the defeat of Greek communism in 1949 due to a lack of resources, the US turned Greece into a stable client state. American power over Greece was manifested in the US’ control over Greek politics and the army. Within Greece, the basis for stability was formed by a stifling police state, in which suspected communists were arrested, detained and tortured. Upon this foundation of coercion rested a conservative triangle of power, made up of the Palace, the oligarchy and the army, that kept Greece firmly in the Western camp. The United States furthermore insulated
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