This was in the Guardian overnight:
Fears were growing on Monday night of a fresh crisis in the eurozone after Greece failed to elect a head of state, triggering a snap election that is tipped to bring radical, anti-austerity leftists to power.
You can sense the anxiety tending towards paranoia in the report, and this in a supposedly left of centre newspaper. If takes little to imagine what what is being said elsewhere about the prospect of a Syriza government led by Alexis Tsipras.
And yet Tsipras is saying something that makes complete sense. In fact, to be blunt, his political crime in the eyes who view his potential rise to power with all the angst that the Guardian clearly shares, is that he is telling the truth. As a matter of fact Greece cannot pay its debts to the Eurozone. Even the FT publishes comment saying that this morning. That has been obvious for a long time.
And it is equally obvious that whilst Greece is yoked to a burden of avoiding the need for bad debt provisions in German banks that German bank regulators would rather not admit to which were, in fact, the fault of those banks in over-lending to Greece in the first place then Greece cannot possibly recover economically from the mess that membership if the Euro has consigned it.
The paranoia that will rampage through the EU's corridors of power, the European Central Bank and the governments of Europe is, however, real in the sense that it will motivate action in those places. The style of that action is not hard to predict. The painting of Syriza as extreme, when one of its goals us to reduce the Greek tax gap, will be a consistent message. Old style anti-leftwing rhetoric will be commonplace. And throughout it all the message will be implicit that the choice of such a government by the Greek people will be unacceptable to Greece's European creditors who will, no doubt, and in short shrift, demand the right to replace that elected government with a new one of their choosing that will ensure that the people of Greece will be denied the only logical choice available to them, of defaulting, and will instead grind them to the burden if repaying an impossible debt. If in doubt note this headline from the FT today:
The ground is already being prepared.
And yet, absurdly, we would not, of course, require this sacrifice of a company, which would be allowed to renegotiate its debt and write part off in such a circumstance so that if might thrive again.
And individuals have the chance of bankruptcy and then moving on.
But for saying Greece has to be provided with this change of breaking free from the shackles of debt - as Germany was by its international creditors in 1953, without which its postwar growth would not have been possible - Tsipras is being labelled an extremist. He is no such thing. He is the voice of reason in a swamp of denial.
But the result is that a quite reasonable fear is developing that Greece is being given notice that its democracy is being constrained. The message that will be sent to Greek people over the next month is that they may vote as the neoliberal Germans who dominate the European Central Bank want or their right to choose may be curtailed. I can describe this no better than Ivan Horrocks, a regular commentator in this blog, did yesterday:
I'm not a betting man, Richard, but on this occasion I think I'll confidently bet that not one EU government will support Syriza. If Podemos was in power in Spain, it'd be a slightly different matter, but on this occasion I can't even see any of the social democrat governments lending support.
As you say, that will show democracy has failed — and indeed it has. It will demonstrate beyond doubt that citizens casting their votes in elections is simply an exercise in maintaining an illusion — a sham democracy. In normal circumstances, that is, within “accepted” parameters, it is a practice that is tolerated — even encouraged for its PR value — by those entities and individuals who truly exercise power and control. But if Syriza stick to their word they will be moving well outside those parameters and for those who truly rule us that can most certainly not be allowed. It would therefore seem likely that we are about to see the full arsenal of the power and control of the “elite” revealed, as we'd expect to be the case when hegemony starts to fail. What the outcome will be is anyone's guess. But in the meantime Syriza require every ounce of support we can give them.
Ivan may well be right. Np but if he is we face a democratic crisis in Europe that will lay bare the reality of the power structure in all Europe's democracies and will make it abundantly clear that the power we think we have to make choice may be little more than tokenistic in nature. If if becomes clear that the only choice we have is to acquiesce to the demands of capital or be denied the choice we want then the shallow veneer of democracy that has existed since the hegemony of neoliberals m arose in the eighties will become too obvious to be ignored.
And then, I admit, I am not sure what will happen. But a point always comes when people realise that there is a power that is oppressing them which they have no choice but to remove. If the outcome was a swing in Greece from the democratic left to the far right of Golden Dawn the outcome may be very much worse for Greece and Europe, but instability would that case become much harder to contain.
There is a necessary price be paid for democracy. Writing off unpayable debt is one such price. Europe had better embrace that reality very soon. The alternative will be very much worse.
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Hi Richard
The response from the European establishment you anticipate will probably imitate what happened in Scotland where almost all of the mainstream media and the whole of the political and business establishment misled, misinformed, bullied and intimidated voters into voting no.
I fear you are right. The support for Syriza is already slipping.
The fact that Syriza can be painted as ‘extreme’ is symptomatic of how the discourse has shifted over the last 35 years. What would once of have been considered a normal part of the political spectrum and representative of a large constituency has been shuffled to the margins of acceptability by the finance world of money managers.
Our ‘democracy’ has been constrained for some time in this way – the lack of historical nous in the political class is shameful and beyond belief.
True
We are old enough to think being genuinely left of centre normal
Agreed Simon, except that I think the political classes are very aware of the lessons of history.
It is the voting public who have been denied the truth in Britain. Just take a look at the national curriculum for the teaching of history in schools…
Could not agree more.
…shame what it means for the Euro project though…
Beautifully put Richard, and you and Ivan are quite right in saying the response of our governments will be wholly on the side of the financial system that is so keen to impose austerity, and wholly against the right of Greeks to vote for anybody who challenges that system. Finance first, people second, every time.
Jeremy Warner was railing against the possibility of Syriza gaining power in the DT today, as you’d expect from a representative of the City;
“Yet it is one thing to quit the euro in a controlled, negotiated and orderly manner — behind the protection of capital controls, with help from the International Monetary Fund to get the country back on its feet — and quite another to be forced out amid political crisis, social upheaval, and the idiocies of an extreme Left-wing policy agenda”.
And then, amongst the tide of foaming at the mouth anti EU Ukip level nonsense and rants about the “evils of socialism”, one of the contributors to the BTL comments posted this;
“Syriza’s economic policy is essentially just a relatively mild Keynesianism. It says much about the lunacy of our age (and the fear of arch-neoliberals with regard to the possibility that the financial sector might one day be asked to take on responsibility for the 2008 crash) that such mildly leftist politics can be painted as extreme. In essence, the 2008 crisis is emphatically not over. All that has happened is that the burden has fallen on everyday people with the expectation that they will just stoically accept austerity policies and the diminution of living standards so that the financial sector does not have to. This state of affairs is not politically sustainable. The crisis will simply re-open until such a time as a more socially just settlement can be sensibly arranged, or else violent extremists chip away at the order and win power themselves, and we all know where that leads. I’d ratehr throw the banks to the wolves with governments backing assets up to, say, £50k and have the rest written off, than repeat the late 1930s, thanks
If Syrzia are voted in then that’s democracy, I’m afraid. Much as it will be if (or rather, when) Podemos achieve a similar success in Spain. You can’t realistically expect people to keep voting for politicians whose sole promise is more of the same (i.e. very high youth unemployment, radically depressed wages, poor job opportunities and acquiescing to bailout terms that suit only creditor states) and only very gradual improvement. Who wants that? It wasn’t everyday Greeks and Spaniards who caused the mess.”
Exactly.
As usual, Richard, very well put.
The Greek nation gave us the concept of ‘democracy’ more than 6000 years ago, a concept that has been increasingly perverted and usurped by the elites it was intended to deny. Now, in the shape of SYRIZA, Greece has a chance to reboot democracy for the Hellenic peoples, Europe and the world (democracy 2.0, anyone?). A good chance at that. Suggestions that support for Tsipras’ party is slipping should be taken with a pinch of salt. Opinion polls are as easily manipulated in Greece as elsewhere. (I noted last year that in one such survey conducted here on voting attitudes that 72% of respondents stated that they normally voted Conservative, showing clearly how unrepresentative the cohort group were of the general public nationally).
No-one, though, should be under any illusions. This will be no ‘Greek spring’. The massed ranks of the Neo-liberal conspiracy will do all in their power to thwart the will of the Greek people. And we only have to look at what is being done to Putin to see that that ‘all’ is a mighty ‘all’. Think less Greek Spring, more Siege of Stalingrad.
If that sounds gloomy it is worth remembering that SYRIZA will also have some pretty powerful bargaining chips. As unpalatable as the Troika might find renegotiation, the prospect of a precipitative Greek exit from the European Union would send a clear signal to the seemingly unstoppable Podemos! in Spain (and to Europhobes here and elsewhere). That may worry Schaueble less than a default, but not Merkel. The German Chancellor will be very mindful that the rise of UKIP here and (worryingly) the Front National in France may well see intolerable stresses placed on the European Union by 2017. A structured default, first by Greece and then by Spain may destabilise the Euro, but head off the complete disintegration of the Union itself.
I think your analysis is sound
The EU will have higher priority than the Euro in the end
Blair’s already done his bit this week to shift perception of ‘the centre ground’.