Posts By Kieran Allen

greece

The defeat of Syriza and Its Implications for the Irish Left

, , 1 Comment

The EU has enforced a humiliating surrender on Greece.  The Syriza government that was elected to end austerity has been forced to implement it.  The meaning of Wolfgang Schauble, the German Finance Minister’s infamous phrase ‘we can’t possibly allow an election to change anything’ is now clear.

The scale of the brutality is astounding.  To take just one example:  there will be a ‘significantly scaled up privatisation programme’ to generate a fund of €50 billion. This fund will then be effectively controlled by the EU to ensure that bank debt and bondholders are paid off.  Up to now €7 billion worth of privatisation has been pushed through by other governments in Greece.

The Irish government helped humiliate the Greeks. The former Greek Finance Minister, Yanis Varoufakis, has stated that Ireland – along with Spain and Portugal – were among his ‘energetic enemies’. He explained why,

the “greatest nightmare” of those with large debts – the governments of countries like Portugal, Spain, Italy and Ireland – “was our success”. Were we to succeed in negotiating a better deal, that would obliterate them politically: they would have to answer to their own people why they didn’t negotiate like we were doing.

This attitude became public when the Labour Minister, Alex White, welcomed the ‘fair’ deal. The Taoiseach, Enda Kenny, went further and claimed that, under the deal Greece, would ‘thrive and prosper’

The Irish government tried to invoke an undertone of nationalist rhetoric to bolster its position. ‘The Greeks are looking for more money from us – they should take their medicine like we did’ was the message. But the issue cannot be framed in such terms because the original €7.5 billion that the Greek government requested as a loan was never going to be used to fund public services. It was earmarked to repay previous loans because Greece had been put on a treadmill of austerity from which it could escape.

In 2012 the Troika intervened in Greece to safeguard wealthy private creditors. In return for a haircut on their loans, these investors got EU institutions and the IMF to fund a Greek loan that guaranteed them re-payments. These ‘loans’ triggered further austerity and created the latest crisis.

So the issue was never about Greek people begging from others in Europe. It was about a devious mechanism to make the Greek people pay for debts to wealthy bondholders. Which is precisely what happened the people of Ireland.

The Irish government’s strategy of using ‘quiet diplomacy’ to get  the Irish debt reduced has proved an abject failure. But by backing Germany’s brutal approach, it has copper-fastened debt re-payment from Ireland until 2053.

WHY DID THE  EU TORTURE GREECE?

Stathis Kouvalakis, a member of Syriza, has described the outcome as ‘the most resounding defeat of any leftwing government in Europe after the war’. It certainly represents a turning point in leftwing politics.

Ever since the crash of 2008, there has been an increasing call among activists to forget ‘old’ debates about reform or revolution. Yet the betrayal of Syriza re-opens this very question. To understand the implications for future socialist strategy, it is necessary to analyize the motivations of both the EU elite and the political strategy of Syriza.

For Paul Krugman, the actions of the EU in humiliating Greece are an act of ‘madness’. The assumption that the EU acted irrationally also finds an echo in Varoufakis’ efforts ‘to save capitalism from itself’. He had aimed  to put ‘forward an analysis of the current state of play that non-Marxist, well meaning Europeans who have been lured by the sirens of neoliberalism, find insightful’. In other words, to present a rational case for why austerity policies would harm capitalism. More generally, Syriza’s strategy was premised on the fact that it could persuade its European ‘partners’ to move away from austerity.

Once they came into government, Syriza found that their words literally fell on deaf ears. Here is Varoufakis’s description of what occurred when he spoke to eurozone finance ministers

‘there was point blank refusal to engage in economic arguments. Point blank. You put forward an argument that you’ve really worked on, to make sure it’s logically coherent, and you’re just faced with blank stares. It is as if you haven’t spoken. What you say is independent of what they say. You might as well have sung the Swedish national anthem – you’d have got the same reply.”

There were a number of reasons why it was not possible to even get them to listen.

Read Post →