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02 January, 2016

One year after Syriza won

Greece and the eurozone: what’s left?

by Tom Vouloumanos

It was almost a year ago that Europe elected its first radical Left government since WWII: the Syriza government in Athens under Alexis Tsipras.

Syriza was supposed to signal the beginning of the end of neoliberal hegemony in Europe and begin the wave of a Mediterranean pink tide. Within its first months in power, Brussels tightened the screws on Athens. The Troika (EU-ECB-IMF) could not afford to cave into a single demand as Madrid and Lisbon would follow.

Finance Minister, Yanis Varoufakis was ridiculed for making elementary economic demands: Greece was bankrupt and in order to pay back its creditors, it needed growth and debt restructuring, not austerity. But the creditors did not care about being paid back, they were in fact subsidizing bank loans to Greece via taxpayers’ money, so that Greece could pay back older loans to those same private banks with the caveat that it implement an aggressive neoliberal program. One can see the anger of many Europeans who are led to believe that their hard earned euros are going to the pockets of so-called “lazy tax evading southerners,” but in fact this money is being used to replenish the coffers of private lenders via a bankrupt state all the while radically impoverishing its population.

The creditors had stalled negotiations with Tsipras for months, while the Greek state continued to make loan repayments without receiving the next tranche of loans, drying up cash flow. The Troika stuck to the same austerity package, rescinding on little progress during “negotiations.” Finally, with his back to the wall in the summer of 2015, Tsipras put the Troika’s “offer” to a referendum. Brussels responded by freezing ECB liquidity to the Greek banking system forcing the government to place capital controls. To the amazement of the continent, 62 percent of Greeks voted no to austerity, even though, it was being made clear by the Troika that the wrong choice would lead to forced Grexit causing Greek bank deposits to vanish. Varoufakis had developed a secret contingency plan, known only to a small clique of government cadres. The plan was to create a parallel virtual euro to allow for electronic transactions to continue thus avoiding economic meltdown. Then Athens would take over the Bank of Greece and proceed to nationalize or at least centrally control the banking system. Finally, Greece would stop making any loan repayments to the Troika keeping any additional liquidity for the humanitarian crisis. The plan was prepared for a forced exit all the while resisting the Troika’s offensive. The creditors would then have to sort out their divisions between those who wanted a Grexit and those who did not want to enter the slippery slope of eurozone disintegration and the potential geopolitical fallout. Tsipras refused the contingency plan since Grexit forced or otherwise did not enjoy public support. Varoufakis, Syriza’s Left Platform faction and others, believed the referendum results changed the paradigm and all bets were off. The only non-acceptable road was austerity. As government leaders believed they faced economic oblivion, Tsipras capitulated and signed on to a Third Memorandum. It was a financial coup.

Varoufakis left the government. The Left Platform formed the Popular Unity party (LAE) that supported an orderly Grexit. Other Syriza argued that even in the event of a Grexit, Athens would still need to borrow money from the same creditors under similar conditions. All the dissidents, no matter which way they went, maintained that the opportunity that was made possible after the referendum was squandered.

Syriza went back to the polls to both ratify its volte-face and expunge its dissidents. Tsipras was again elected to office albeit to less enthusiastic applause. The high hopes of Syriza’s victory in January 2015 had turned to pessimism taking the winds out of sails of Podemos and other European Left forces.

The new Syriza government is now grudgingly and under constant threat implementing a program it fought against. Yet ranks and file leftist still hope of resistance even within the paradigm of Troika rule. One can call this ‘Gresistance’ i.e. a form of resistance within austerity that is both legal and subversive.

Gresistance is about stretching any terms of the Memorandum, in order for the wealthy to wear the deal rather than impoverished Greeks. It is about turning a blind eye to anti-social laws not being executed or obeyed. It is not an official policy, it is subtle and unspoken and it is unfortunately in the tradition of Greek para-state corruption. Gresistance is understood as an unofficial informal means of mitigating the humanitarian catastrophe and it was even euphemised in Syriza’s post-referendum campaign as a parallel program. This program was not detailed, it was a statement of values, but it was a subtle indicator of Gresistance.

The creditors are well aware of this, and do not trust Syriza even with its left flank cleansed out. The Troika wants the bailout laws passed and carried out before providing cash flow. Brussel technocrats are not concerned about economic indicators, they are cognizant that an economy under austerity will continue to shrink the state’s capacity to service its debt. The goal is to impose a two tier neoliberal model under corporate-technocratic rule. One tier will hold the wealth and industry, the other tier will provide cheap labour and resources. This is the Europe of Merkel and Schauble and it is this Europe that is being acquiesced to by Madrid, Rome and Paris.

Today, the hopes of a year ago have turned to despair. Syriza hoped that Portuguese and Spanish elections would bring Left allies to power - but this was not be. Syriza’s retreat was devastating to the European anti-neoliberal cause.

So what is Left of the Greek Left? Its people!

The myriad of social experiments, whether cooperatives, solidarity networks, or alternative currencies need our support. There is much to do for Athens, especially now. Syriza should host a European alternative economy forum. The various grassroots models of economic alternatives need to be discussed and made public. The people behind European social or solidarity economic experiments need to coalesce, teach one another and take common action. These grassroots initiatives can be assisted politically by parties such as Syriza, LAE, Podemos, Die Linke and the like. Syriza can provide concrete assistance to the alternative economy such as coordinating alternative currency initiatives by issuing virtual credit to citizens so that they can buy products like food directly from farmers. People are already trading items on the net via virtual points. These virtual points can be accumulated and used as payments for public utilities, taxes, etc. The military can be used to ship food, medicine etc. from social solidarity groups to a public in need. Such a forum can be formalized within Greece as a People’s Parliament, where representatives of civil society can meet, coordinate efforts, and build the foundation of an alternative economy movement.

Even under the boot of austerity, Syriza can assist civil society in building new participatory institutions so as to plant the seeds of a post-neoliberal Greece and a help build a pan European popular coalition for another Europe.

What’s left is much work and struggle ahead.

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3 comments:

  1. Tsipras refused the contingency plan since Grexit forced or otherwise did not enjoy public support.

    The referendum showed Grexit has public support. Tsipras buckled because he is weak and stupid.

    Other Syriza argued that even in the event of a Grexit, Athens would still need to borrow money from the same creditors under similar conditions. Why? No reason to say this but abject ignorance. Ignorance based on fear of thinking, learning or saying something true if everyone else - men in suits with fancy degrees - who looks like they know what they are talking - babble nonsense to the contrary.

    This glaringly omits Schauble's offer of negotiated Grexit - an outcome better than I had hoped for. Syriza's negotiating strategy was a success! The problem is that they, Tsipras in particular, simply could not recognize victory - not if people in suits, with fancy titles and degrees didn't call it victory.

    The most potent weapon in the hands of the oppressor is the mind of the oppressed. One can never say that too much. In fact, it is practically the only weapon - really, what else is needed?

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    Replies
    1. "The referendum showed Grexit has public support. Tsipras buckled because he is weak and stupid."

      Not really. Otherwise the Greek people would not vote for him after he signed the third catastrophic memorandum, plus, they didn't vote for Popular Unity, the party that came out of SYRIZA split and supported the exit from euro and the liberation from the EFD. Unfortunately, the Greek people have chosen euro and they will pay for it.

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  2. What people will do after they have been deceived and betrayed, after their will has been broken - which notably includes not voting at all - is different from what they would do with a non-suicidal leader who actually tells them the truth - that exiting from a currency union is not such a big deal, and it would be greatly beneficial. The polls before the referendum declined a bit after it was made clear that the Eurocracy was "threatening" exit, making it clear that the No vote was pretty solid - if it only had had support from the "top".

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