It didn’t take long for Greece’s radical new government to fall off the front pages in head-in-sand Britain. But don’t worry, it will be back. It’s not impossible to see how Alexis Tsipras’s anti-austerity mandate from his battered electorate can be used to benefit us all. But it’s much easier to see how a mismanaged showdown between Brussels, Athens and (especially) Berlin could make a bad situation worse.
Judging by Ed Miliband’s arms-length response to Syriza’s striking victory in Sunday’s election (“It’s up to each country to choose its own path,” he said), the Labour leader is aware of the risks both to Europe and to his own electoral prospects if things quickly go pear-shaped for the Tsipras team. Scary thought, the new cabinet is full of clever academics, some trained at Essex University, others political novices. Not “tainted by experience”, as the old joke goes.
Rightly or wrongly, David Cameron sees Greek opportunities for this spring’s Tory campaign. But it’s not mainstream conservative parties such as Cameron’s that progressive voters should be keeping one eye on. In seeing Syriza’s triumph as the vanguard of leftwing anti-austerity wins in Spain – where Podemos is in poll position – and elsewhere, their eyes may be on the wrong ball.
“Syriza, Podemos, Sinn Féin, the SNP, now a bright light is shining in England too,” George Monbiot writes in the Guardian, urging Labour voters to abandon timid Miliband in favour of the bright-light Greens. It’s an upbeat point of view – hope is always important and attractive in public debate. But his list omits Ukip, the French National Front, Alternative for Germany and other northern rightwing parties. They also see opportunities in Sunday’s result. Far from being “an end to the politics of fear”, as Monbiot hopes, it could trigger an exponential growth of it on unruly streets.
Apart from not wearing a tie (our own Dave often does that) and not being sworn into power on the Bible (Ed Miliband is a non-believer), Tsipras – whose cabinet meets for the first time on Wednesday – has done two striking things since Sunday. He placed flowers at the Kaisariani memorial where 200 mostly communist insurgents were shot in reprisal by German troops in May 1944, martyred symbols of the divisive civil war which engulfed Greece for years. Abandoned by Stalin, the left lost.
That gesture was pure symbolism, albeit the divisive kind which must have troubled more voters than the tax-dodging oligarchs who have controlled and corrupted Greece for decades – and whose excesses are rightly in Syriza’s sights. It will be tough taking them on, just think how hard it is for institutions of Britain’s still-functioning state to rein in our own less-well-entrenched financial elite.
Far from symbolic was Tsipras’s other striking decision, to make up for Syriza’s two-seat failure (149 out of 300) to win an outright majority in parliament by cutting a deal with the rightwing Independent Greeks party (13 seats) which makes the explicit connection between crippling, Brussels-imposed austerity and the massacre at Kaisariani. The EU is run by “German neo-Nazis”, it says.
Not nice or even true, but understandable in the post-crisis years when the Greek economy has shrunk by 26% and unemployment has risen as high (youth unemployment at 50%), while families at most levels of society have suffered badly. The Guardian’s Helena Smith vividly conjours up the pain here – as does the BBC’s Graeco-phile interrogator, John Humphrys (he has family in Greece) in this article for the Mail.
I’ve yet to see a reassuring explanation for such a Faustian parliamentary bargain – except that anti-immigrant Independent Greeks (they are not to be confused with fascistic Golden Dawn) are also determined to resist eurozone economic intransigents. The two parties cooperated last month to vote down the discredited mainstream’s candidate for president – thus triggering Sunday’s election. They are both pro-sovereignty nationalists. Wednesday’s cabinet meeting halted privatisation which will please many, but is not necessarily smart.
What next? After dropping menacing (and rejected) hints of doom during the Greek campaign, Brussels and Berlin have been quiet since Sunday. Tsipras and his allies became more moderate in their rhetoric as polling day approached. You probably saw some of them on radio and TV, speaking brilliant, colloquial English, much as Englishmen once spoke classical Greek. Here’s the new Essex-and-Cambridge trained finance minister, Yanis Varoufakis, on Radio 4’s Today.
We’ll be hearing a lot more of Varoufakis who sounds clever and funny; he likened Greece’s treatment to waterboarding. Athens can’t stay in severe austerity and hope to pay off its debts through resumed economic growth because the austerity package makes growth impossible, he says. He has a point – one which resonates right across southern Europe through Italy, Spain and Portugal and heads north to Ireland too. Stick around, Dave and George, you might learn something.
But what to do about it? Here’s where Syriza’s rhetoric starts to make me nervous. Academic novice politicians strong on logic, weak on experience, don’t always realise that other people have equally strong views but different ones.
Tsipras gives the impression he will have a stronger hand dealing with Brussels and Berlin than he does. He forgets that anti-austerity Podemos might win in a sunny, debtor country like Spain in December , just as a milder version – Ed Miliband – may prevail in the UK on 7 May. But in frosty creditor countries of the north like Finland, the rightwing True Finns may do rather better in April as a result of the Greek showdown, if leniency is shown.
True Finns are populist, nationalist, socially conservative and economically quite leftwing. Some days Ukip can sound a bit like that, though consistency is not its abiding vice. There are plenty such parties and voters, feeling hard done by, resentment of elites and immigrants, fearful that they will pick up the bill while idle Greeks sit in cafes. The NF’s Marine le Pen is a serious contender for the Élysée, as Nigel Farage is not.
Syriza seems to make light of this counter-push. It will try to get its debts (currently 175% of GDP) halved and be granted more time to pay. Most of the £200bn or so loaned to Greece by the eurozone and IMF has gone to buy bad debt and service interest payments, not to help most Greeks. After all, post-war Germany enjoyed debt write-offs too and ought to know from the 1920s how dangerous it is to squeeze debtors too hard.
So Syriza has a powerful point, but not much power to enforce it. Threatening to cut one’s own leg off in retaliation is rarely persuasive. If Greece leaves the eurozone – “Grexit” – or is forced out, things will be tough for a long time everywhere, but worse in Greece because the eurozone has had time to organise a firewall since 2008. Things couldn’t get worse ? They always can.
A more moderate compromise known as “extend and pretend” will not write off Greek debt, but allow more time to pay. That would allow the eurozone system to stagger on, but not avoid complaints about special treatment from others undergoing austerity-plus-reform programmes which the old Greek regime only fitfully tried to tackle: poor productivity, market rigging, tax evasion and other self-defeating habits which chiefly benefit the rich.
If Brussels and Berlin try to ignore or override Syriza’s democratic mandate by refusing to write off part of the debt (cut it to 110% of GDP and allow more time to recover, say some) then some form a debt default becomes inevitable, probably followed by a Grexit which 75% of Greeks, including Tsipras, say they don’t want. It sounds like having your cake and eating it, but that’s what bad politics ends up promising.
The grownups here must be the Germans, led by uber-grownup Angela Merkel, the woman with the cheque book. They must be more imaginative. They allowed the Greeks to borrow all that money safely inside the eurozone after 2001 thanks to financial figures that Goldman Sachs wickedly helped Athens to massage. It should never have been let in: the European Central Bank (ECB), France and Germany too, are Wonga payday lenders: they had a moral duty to prevent irresponsible fiscal policies and lending. They failed.
Trouble is they have domestic politics too. France is weak, German voters, their bankers and their tabloids, are already angry (wrongly) over the ECB’s quantitative easing (QE) programme to ease recession. They think they’re being stuffed again. Act too tough and they risk damaging Germany too. Scary times, an opportunity for resurgent nationalism all round – Greece too.
Are we in better shape? Not much, our recovery is fragile and debt-driven. But at least we are outside the multinational eurozone chess board. Ours may be a mess, but at least it’s ours.