In staring down the European Commission, the IMF and the European Central Bank thus far, the Greek government has represented the hopes of the world’s ‘99%’. Greek resistance has symbolised a show of strength and hope to those elsewhere in the world looking for an alternative model on behalf of those marginalised by the accumulation of wealth and power in the hands of the 1% elite.
The election of the Tsipras-led Syriza government was seen as a victory for the Left at large. Those of us who aspire to a fairer economic model and a world where the power of trans-national politico-economic institutions have countervailing force at national level, found hope in the Greek government.
In taking the European creditor’s austerity proposals to a referendum, we saw a government speak up for sovereignty, for national interests, and for a distinctive socio-economic and political way of life, and we wish ours did too. In the ‘brinkmanship’ of the referendum on austerity, we saw a government that was prepared to consult its people on a significant issue which could affect that way of life. It was a government prepared to stand against the money lenders. A government prepared to not just bow down and enslave its people to more taxes, worse working conditions, and longer hours of work further into old age to pay off ill-advised debts they barely benefited from. We saw a government that inherited a manufactured debt crisis, but refused to accept the old line that ‘there is no alternative’ to austerity to solve it.
But in standing up to the European troika, Greece showed us a glimmer of hope that there might be an alternative to the current model of neo-liberal capitalism too. Economist Thomas Piketty and others wrote an open letter to Angela Merkel calling for a more humane rethink of the austerity recipe proposed for Greece. Writing in The Guardian, Jennifer Hinton said the economic future for Greece doesn’t need to just depend on the dichotomous alternatives of austerity or stimulus. There are other models that should be supported – retaining the assets of the Greek common wealth, supporting credit unions, measuring not just GDP, but happiness as a measure of success and prosperity. Before becoming Greek’s Finance Minister, as economics professor, Yanis Varoufakis himself said there must be alternatives to the current ‘indefensible European socio-economic system’ that offer the prospect of salvation.
We hoped Greece could stare its creditors in the face and call their bluff. A default on loans would offer a clean slate for Greece, a reclamation of sovereignty, of self-determination. The opportunity to forge a new path with nationalized institutions. (Though of the means to meeting immediate liquidity needs and facilitating the exchange of goods and services, less was certain). A Eurozone apocalypse was to be the Left’s political opportunity.
But in latest developments, hope of a prolonged resistance to austerity are eroding. Leaked details are emerging of a Greek back down, with suggestions the Tsipras-led Syriza Party is prepared to concede tax changes, less, and delayed pensions, and privatization, in exchange for a three year loan extension.
That’s the reality Governments have to face. Capitalism is too big to fail. The powers that be will do all they can to save their sick child. They can alienate and cripple a country economically, they can undermine its leaders, they can starve its people then offer humanitarian aid to make a point – capitalism is THE way of distributing goods and services, and for struggling countries around the world, it’s austerity or bust (where bust ultimately means more austerity). The continued resistance of the Greek government to its creditors threatened to undermine the European Community, its economy, and the hegemony of its doctrine. That instability and disobedience must be contained.
The Greek government was between a rock and a hard place – concessions to creditors in exchange for a bail-out, or an uncertain and probably short-lived and unstable political future. Given what this critical juncture signaled for not just Greeks, but for an alternative economic agenda, we might have hoped for a better fight.
An excellent summary of the situation, thank you, Christine Rose!
However, in fairness to Syriza, they have only until next week before the banks run out of money . . . so some degree of compromise is necessary. After all, no one else, apart from the troika are offering any kind of bridging finance whatsoever.
Meanwhile, the BRICS nations are going about setting up a new Development bank, (largely financed by China thus far). There is a glimmer of hope, perhaps, that THIS might show a better way forward than has been the case with the IMF, dominated as it is by rich oligarchs who run the worlds’ Corporatocracies for the benefit of the 1%.
The Chinese PM has called on the Brics nations to run their orgainization “for the betterment of humankind”, rather than for the btterment of the 1%. If he is genuine about that, then the contrast between BRICS and whats going on at the IMF could hardly be more stark!
Yes I agree the BRICS is needed because IMF, World bank ect’ use serious blackmail tactics and must be challenged here.
We are almost like the gun toting bandit in the wild west here with these creeps.
Get rid and let Russia/China/India,brazil,south Africa offer us a better way.
Long live Greece. – stand tall for us & don’t be blackmailed by EU thugs.
http://www.germanynews.net/index.php/sid/234688407
Hope the Germans still reject Greece’s second bailout proposal as it is a selling of assets Ports, and other assets to the TROIKA criminals.
Germany News.Net 11th July 2015.
“Greece’s proposal to creditors ‘insufficient’: Germany Germany News.Net Saturday 11th July, 2015 German Finance Minister Wolfgang Schauble said that Greece’s latest proposal for a third bailout package from its international creditors is “insufficient”. Schauble gave his assessment on Saturday, upon arriving at an extraordinary meeting of Eurozone finance ministers, who are evaluating Athens’ last-ditch proposal aimed at remaining in the 19-nation Eurogroup. The southern European country is seeking more than 50 billion Euros ($56 billion) through 2018 in exchange for carrying out a package of austerity measures it says total some 12 billion Euros. The proposals made by Greek Prime Minister Alexis Tsipras do not allow an “easy outcome”V said the German minister, who represents Athens’ main creditor, warning of “extremely difficult negotiations” during Saturday’s meeting and reiterating that the suggestion of debt relief was off the table because that would violate EU treaties. Schauble expressed skepticism even though Greece’s latest proposal includes several key demands of the Athens’ so-called troika of creditors, the European Union, European Central Bank and the International Monetary Fund, including sales-tax hikes and cuts to government spending on pensions. Many observers said the latest proposal was nearly identical to a European blueprint that Tsipras urged his countrymen to reject in a plebiscite last weekend. Meanwhile, Germany’s Frankfurter Allgemeine Sonntagszeitung newspaper reported on Saturday that the German finance ministry is planning to propose a temporary five-year Grexit, the common term for a Greek exit from the Euro, as a way for Athens to resolve its debt crisis while still remaining in the European Union. The Greek government is officially in arrears to the IMF, having missed a payment of 1.5 billion Euros ($1.7 billion) that was due on June 30. Athens found itself unable to make the payment after failing to reach agreement with the troika on the disbursement of the remaining 15.5 billion Euros ($17.3 billion) of a second rescue package for Greece. Syriza won election in January on a promise to throw off troika-mandated austerity that has pushed Greece’s unemployment rate above 25 percent even as the ratio of debt to gross domestic product has soared amid an economic contraction of more than 20 percent.”
I dont agree that this is a good analysis because it ignores the alternative solution of leaving the Eurozone. The recent referendum only asked the people to vote against the present austerity measures .. and got the required vote. If the question had been “Should Greece remain within the Eurozone?” the answer would have been “Yes”. These two positions are incompatible. If Greece stays in the Eurozone it loses. If it chooses to quit the Eurozone and give up on the Euro, it can nationalise the banks and reissue the Drachma. A number of well respected economists say that in the long term this is the best answer.
STOP PRESS Immediate release.
http://www.theguardian.com/business/live/2015/jul/12/greek-debt-crisis-eu-leaders-meeting-cancelled-no-deal-live
EMERGENCY TALKS IN BRUSSELS IMPOSES NEW HARSH MEASURES ON GREECE OR LEAVE EURO. 13/7/15.
It’s official folks; Germany has forced the “Eurogroup” to impose a amended proposal for Greece to take a five year exit from the Euro if it does not accept even more insidious “Austerity” such as a special EU group taking over Greece “privatisation”.
These leaked proposals came out at at 6pm Brussels time, or 6am NZ Time 13th July 2015.
So in the new Eurogroup proposal Greece is being forced into even more damaging hardship and robbery by “Austerity at the hands of EU group lead by Germany.
Leave the Euro and accept help from BRICS and Russia because if you don’t Greece will implode, so we are with you as you stand for NO MORE AUSTERITY.
Damn you EUgroup you blew it yet again you loggerheads.
Even Richard Quest on CNN is gobsmacked!!!
This only confirms what I have said above. Leaving the Eurozone always was the only practical option. Greece now needs to find alliances with some of the other southern European Euro members that are struggling (Italy, Spain, Portugal). If they band together they can make a viable bloc.
What is the alternative to Austerity that Syriza is offering? Specific policies would be good to see.
You’re asking for “specific policies would be good to see”?!
You have a cheek, Gosman!!
How so? It seems like a pretty straight forward question. The Eurozone leaders have been negotiating for some months with Syriza and yet I have yet to see anything from the Greek side that is not just a more moderate form of austerity. If there is an alternative I would like to know what it is.
Good call Gosman
The current Greek government was elected on the basis of staying in the Euro whilst not paying their debts and avoiding austerity. At no point did they explain how they were going to achieve that modern day miracle.
So far it’s looking like they’re going to do as they’re told by the EU: Sell off underperforming state assets, plug the leaking tax system and cut off early pensions.
Staying in the EU under some level of ‘austerity’ may be bad but it might just be better than being thrown out as a bankrupt state.
This Washington Post Online article points out how instead of standing up for the 99% in Greece Syriza has failed abysmally in trying to negotiate a better deal.
http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/10/how-greece-went-from-victory-to-economy-destroying-defeat/
Europe (Inc) and the capitalist / financial system were prepared to strangle and undermine the Greek economy and the Syriza Government if that’s what it took to contain sovereign defiance from other countries and keep the greater project intact. It’s not that ‘there was no alternative’, but capitalism and its systems, and its debt, will be preserved at all costs. The EC easily called Greece’s bluff and tested its strength. Syriza didn’t really have a chance to develop any alternatives – either incremental, or radical.
Why not? Surely they had a plan beyond begging to be given more money with no strings attached when they got elected.
You mean… like Kiwis expcting hand-outs in the form of the 2009 and 2010 tax cuts, Gosman? Because I’ll tell you this for free – those tax cuts weren’t paid by us. They were funded by overseas lenders.
But that sure as hell didn’t stop foolish New Zealanders voting for Key, or the Nats going ahead and borrowing billions to fund those tax cuts.
Your call.
My call on what? Even if your analysis was correct your view seems to be that if we became bankrupt as a result other nations should come in and rescue us and forgive our overseas debt. That is if your views on Greece are applied to us as well. Do you think we should expect such help if we required it?
No, Gosman, it means we shouldn’t be so arrogant and eager to pass judgement on others. Not when our situation is not much better than our Greek cuzzies when it comes to massive debts (both sovereign and private).
Much of that debt was built up by passing tax cuts in 2009 and 2010 which we could ill afford and which we have to borrow from offshore to finance. You’re not stupid, I think you understand this very well. Put aside your ACT ideology for one moment and think it through: borrowing for tax cuts was the height of fiscal irresponsibility.
Despite your incorrect economic analysis you are right in that I agree that the tax package in 2010 was structured incorrectly. The Government should have cut some of the unsustainable spending put in place by the Labour led government during it’s last term in power. That would have made the Tax cuts far more affordable.
What “unsustainable” spending? And what makes it “unsustainable” – ACT policy?
Varoufakis had a plan. Unfortunately so did Germany. http://www.newstatesman.com/world-affairs/2015/07/yanis-varoufakis-full-transcript-our-battle-save-greece
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