Greece: European elites declare war on SYRIZA gov't

Thousands of people took to the streets in Athens on February 5 to support the new anti-austerity government's stance.

If anyone was still wondering whether European politics and a Europe-wide class struggle actually exist, reactions from all quarters to the first two weeks of Greece’s new SYRIZA-led government would have cleared up any doubts.

The conflict between Europe’s ruling elite and the new Greek anti-austerity administration, headed by radical left party SYRIZA, reached a high point on February 4-5.

In its first days in office, SYRIZA raised the minimum wage, reconnected electricity to 300,000 poor households cut off for non-payment of bills, re-employed sacked public servants and stopped impending privatisations.

But the big battle was always going to be its proposal to renegotiate the terms of Greece’s debt with European institutions.

On February 5, a headlong media conference clash took place between German finance minister Wolfgang Schäuble and Yanis Varoufakis, his Greek counterpart. It came as Schäuble rejected any suggestion of restructuring Greek debt.

ECB blackmail

The night before, the European Central Bank (ECB) announced it would not accept Greek government debt as collateral for loans to Greek private banks after February 11. This turned the screws on the SYRIZA government to abandon its anti-austerity policy commitments, which are largely dependent on winning debt alleviation.

Varoufakis predicted such a move against a SYRIZA government in a TV debate two years ago. It leaves Greece with only one line of credit to the ECB — Emergency Liquidity Assistance, which carries a higher rate of interest and runs out on February 28.

At the same time, news service Reuters reported it had access to a German government document that amounts to a demand that the new Greek government surrender.

The document demands that the Troika of the ECB, European Union and International Monetary Fund is maintained. Varouflakis has said Greece would not deal with the Troika.

It also insists on continued payments to the ECB and IMF, primary (before interest repayment) targets of 3% of GDP this year and 4.5% next year (as against the 1% proposed by Varoufakis), sacking 150,000 public workers, reversing the minimum wage rise and continuing privatisations.

These demands came as Prime Minister Alexis Tsipras and Varoufakis were conducting a tour of key European capitals seeking support for SYRIZA’s debt restructuring proposal. This would make debt repayment contingent on Greece’s economy meeting growth targets.

In the opening session of Greece’s new parliament on February 5, Tsipras was defiant: “Greece won’t take orders any more. Greece is no longer the miserable partner who listens to lectures to do its homework.

“It cannot be blackmailed. Greece has its own voice.”

Outside the parliament, thousands of people taking part in the first demonstration in decades in support of a Greek government roared their rejection of the attempted blackmail.

Not Greece?

The huge impact the new SYRIZA government is having on European politics is shown most tellingly not so much by the surge of support from ordinary people across southern Europe and Ireland — where large demonstrations supporting SYRIZA’s anti-austerity stance have taken place — but by the political body language of their rulers.

For the governing parties in the other countries hit by the “rescue packages” of the Troika, it’s a nightmarish thought that SYRIZA’s strategy — of debt restructuring combined with higher wages, welfare benefits and public investment — might prevail.

After SYRIZA’s win, government spokespeople in Spain, Ireland and Portugal seemed to decide their populations had suffered fits of geographical confusion.

“Spain is not Greece,” said Antonio Lopez-Isturiz, the Spanish general secretary of the European People’s Party, on January 26.

“Portugal is not Greece,” said Portuguese prime minister Pedro Passos Coelho to journalists at the Catholic University of Portugal several days later.

“Ireland is not Greece,” said Irish finance minister Michael Noonan in Luxemburg on February 4.

In Greece itself, opinion polls seemed to indicate that, for a majority, even Greece might not be Greece — or at least the Greece they knew.

An opinion poll by French Greek affairs site okeanews.fr revealed that the outgoing New Democracy-PASOK government had been the third most hated in the world.

On the other hand, new polls taken after the January 25 elections showed 56%-60% were pleased with the election result, 70% believed Tsipras would make a good prime minister and 52%-56% were supportive of SYRZIA’s governing coalition with the right-nationalist Independent Greeks (ANEL).

This support would not have been hurt by the February 3 announcement that the government will sell its luxury car fleet and require its ministers to travel in economy class or use their own cars.

On January 28, Fintan O’Toole, former literary editor of the Irish Times, put the issue like this: “The Irish political elite is deeply invested in an essentially religious narrative: Ireland sinned, Ireland confessed, Ireland did penance, Ireland has been forgiven, Ireland will be rewarded.

“If SYRIZA’s strategy in Greece succeeds, this will be exposed as a folly.”

Portuguese PM Passos Coelho said it was “a child’s fairy-tale” to argue “that a country might, for example, not accept its international commitments, not pay its debts, want to raise salaries, lower taxes and still expect partners to have the obligation to guarantee its financing”.

Snakes tied up in knots

As for Europe’s social-democratic parties, they have been torn between the “imperatives of government” and the sympathetic reactions of their traditional voters to SYRIZA’s moves in government.

The Portuguese Socialist Party (PS), which called in the Troika in 2011 but is not in government and so far faces no serious challenge to its left, waxed lyrical about SYRIZA’s win. In the words of PS general secretary Antonio Costa, it was “a sign of hope” indicating “the exhaustion of the politics of austerity”.

In Spain, the Spanish Socialist Workers Party (PSOE) has fallen to third place in opinion polls behind radical newcomer Podemos and the ruling People’s Party (PP). Leader of the PSOE’s group in the European parliament, Iratxe Garcia, expanded the “Spain is not Greece” slogan to tweet: “Spain is not Greece, PASOK is not PSOE, SYRIZA is not Podemos”.

Inviting SYRIZA to “ally itself with all progressive and social-democratic forces”, Garcia said Greece’s traditional social democratic party PASOK, all but wiped out in the polls, had been a “victim of its strategy of sustaining the governability of Greece by supporting a right-wing government”.

She added: “That pact with the right isn’t going to take place in this country, therefore parallelisms with the situation of the PSOE are out of place.”

But deeds speak louder than words. Ten days later, PSOE general secretary Pedro Sanchez signed an “anti-terrorist pact” with PP prime minister Mariano Rajoy.

And on the day after SYRIZA won in Greece, Susana Diaz, PSOE president of the regional government of Andalusia, announced early regional elections in a bid to take advantage of Podemos’s incomplete state of organisation in the area.

SYRIZA strategy

The SYRIZA-led government’s strategy is Europe-wide. It seeks to isolate the core base of austerity in Europe, the German government and the Bundesbank, by making the convincing case for debt relief and growth to as broad an audience as possible.

What the first week of its efforts seem to have revealed, however, is that it will take a whole lot more political pressure on European social democracy — via solidarity and mobilisations by friends of Greece everywhere — to force it out of the austerity camp.

No one has expressed the stakes more clearly than newly elected SYRIZA deputy, economist Costas Lapavitsas. Writing in the February 2 Guardian, he said: “The harsh reality is that the EU has substantial leverage over Greece.

“The country has major debt repayments in the coming period, the largest due in early summer, which will be impossible to meet without fresh funding.

“The domestic program of SYRIZA, moreover, remains insecurely funded, even if the government aims simply to achieve a balanced budget. Income tax has been falling, partly because of the extraordinary tax pressure imposed by the troika, and partly because of the disruption of the election.

“It will take a major and rapid reorganisation of tax collection to secure funding for the planned measures to relieve those worst hit by the crisis. And the banks continue to be absolutely dependent on liquidity provided by the ECB and are susceptible to deposit flight.

“The pressure on SYRIZA to water down its demands and comply with the core requirements of the bailout programme is likely to be ferocious. If the SYRIZA leadership is not to buckle under the strain it is vital that it should receive strong international support, including good, practical proposals on how to deal with the massive difficulties ahead.

“Further discussion is needed, for instance, on whether Greece should repay in full the part of its debt that is owed to the ECB and the IMF (roughly €70 billion out of a total of €320 billion). The legal and moral basis of that debt is well and truly open to dispute.

“[T]wo things are of paramount importance: first, the forces of austerity currently strangling Europe should not be allowed to crush the SYRIZA experiment, or turn it into a moth-eaten compromise; second, SYRIZA should make solid and meticulous preparations for all eventualities, a point that is well understood by many within it.”

[Dick Nichols is Green Left Weekly’s European correspondent, based in Barcelona. A longer version of this article will appear at Links International Journal of Socialist Renewal.]

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