Saturday, July 4, 2015

The Greek referendum and the tasks of the Left

By Stavros Mavroudeas* (Guest blogger)

For six months, after its January 2015 election victory, the SYRIZA government began negotiations with the EU. In these negotiations SYRIZA was confronted with the stubborn and increasing intransigence of EU and its companion institutions (the ECB and the IMF). SYRIZA very soon accepted the logic and the structure of the troika program; that is the Economic Adjustment Program for Greece popularly called the Memorandum. It simply tried to modify it by making it less front-loaded (i.e. delaying the implementation of reductions in pensions and hidden wage cuts, reducing fiscal primary surplus targets and thus making fiscal policy less austere). It also asked for facilitating debt servicing (by rolling back debt, leveraging and ‘financial engineering’) and an increase in aid funds (through the fictitious Juncker plan) that would help to jumpstart the moribund after 6 years of austerity Greek economy. Last, it shyly asked for some commitment for a future reduction of the Greek debt. The EU, as soon it diagnosed this conciliatory mood by SYRIZA and since the whole game was played in its ground, begun pressing it for additional concessions. The more that SYRIZA slide towards capitulation the more the EU demanded. In the end it was politically infeasible for SYRIZA to accept all of EU’s demands, even despite its humiliating compromises and its blatant betrayal of even its mediocre electoral program. This led to the breakdown of the negotiations and the call, by the SYRIZA government, of a referendum on the troika’s demands.

The breakdown of the negotiations between Greece and the EU proved beyond doubt the true nature of the EU: it is the enforcers of the interests and prerogatives of the dominant capitalist powers of Europe. It imposes neoliberal austerity policies on the people and weaker countries of Europe for the benefit of capitalist profits.

Moreover, the negotiations’ breakdown demonstrates the unrealistic character of the SYRIZA government program for a ‘decent compromise’ with the EU that would be ‘neither a clash nor a capitulation’ and for ‘staying in the Eurozone at any cost’. If you want to stay in the Eurozone and the EU you have to capitulate to the demands of its dominant powers. There is no other way. Thus, even the 47-pages long SYRIZA proposal for a milder version of the troika austerity program was indignantly rejected.

The failure of the SYRIZA strategy and the simmering popular discontent with the return of the troika austerity policies obliged the SYRIZA government to reject the troika demands and put them to the public vote through a referendum. At the same time the SYRIZA leadership argued that in case of a ‘NO’ it would approach again the EU for new negotiations.

SYRIZA failed not only strategically but also tactically. It did not touch the deep state structure that continuous to be manned by obedient servants of the Greek oligarchy and, on top of that, SYRIZA used more of them in several crucial positions. For example, SYRIZA did not acquire control of the central bank and also accepted or even appointed several ‘men of the system’ in the directorship of commercial banks and other crucial public enterprises. SYRIZA emptied the state coffers by stupidly paying all the due tranches to IMF and the international creditors. Thus, once the referendum was called the EU, in close co-operation with the Greek bourgeoisie, created a condition of asphyxia for the banking sector and obliged SYRIZA to impose very severe capital controls on the very day that the huge mass of Greece’s badly paid pensioners (that support also another big portion of the population) were paid. In this way a referendum that was going to be an easy NO to troika’s demands victory was turned into a close call.

On top of that the Greek bourgeoisie immediately created its own united front (by setting aside political and economic differences), mobilized every means available (mass media, bosses’ pressure on employees etc.) and embarked on a blatant terror, slant and misinformation campaign. Its aim is to terrorize the rest of the population (and particularly these significant segments of the middle strata that have survived the crisis and had not been proletarianised) that unless Greece surrenders unconditionally to the EU then all hell would break loose.

Against this assault SYRIZA oscillated for a critical period toying (because also of internal pressures) with the idea of canceling the referendum and offering more concessions to the EU which the latter – having smell blood – humiliatingly rejected. Only then SYRIZA began to embark on a campaign to win the referendum but at the same time assuring that afterwards a deal will surely be struck with the EU.

In the rest of the political spectrum of the Greek Left only the main forces of the extra-parlamentary Left took up the challenge and energetically fight for a massive popular No to the EU. The Communist Party, betraying all the communist traditions in Greece, declared that it will put in the ballot box its own ticket. Practically, this means that is suggests an invalid vote and it implicitly helps the YES campaign.

Sunday’s referendum is a crucial battle. What is at stakes is whether the Memorandum’s barbaric restructuring of the Greek economy and society will continue or another course will be inaugurated.

This conflict is being fought along very clear class lines. This is almost obvious if you stroll around in Athens’ neighborhoods or in work places. In bourgeois areas and in managerial functions there is an unforeseen mobilization of even apolitical people in favor of YES. On the one hand, in working class and popular quarters there is an evident majority of NO. Middle class areas tend to divide between haves and have nots.

The prevalence of systemic forces of the YES, irrespective of whether SYRIZA remains or not in the government, would mean that Greece would move towards our poorer (and further impoverished by the EU) Balkan neighbors and compete with them in a ‘race to the bottom’ who would be more cheaper – in wage costs and asset prices – in order to get a small reward from EU’s masters.

A victory of the NO would block this course. It will come only through the return of the mass popular mobilization that existed before everything was erroneously delegated to a SYRIZA electoral victory that was proved inefficient. This will also dispute SYRIZA’s unrealistic and conservative attempts for a new renegotiation of the Memorandum program. It will bolster popular confidence that the EU and the Greek bourgeoisie are not unbeatable and that another course outside the shackles of the EU is feasible.

It is the responsibility of the militant Left and the vibrant forces of the working class to take this battle on their hands.

* Stavros Mavroudeas is a Professor of Political Economy in the Economics Department of the University of Macedonia. Web:

1 comment:

  1. «facilitating debt servicing (by rolling back debt, leveraging and ‘financial engineering’) and an increase in aid funds (through the fictitious Juncker plan) that would help to jumpstart the moribund after 6 years of austerity Greek economy.»

    Before SYRIZA took over Greek GDP was at the same level as in around 2000:

    and GDP per capita was 50% higher than in Bulgaria. Was the greek economy in 2000 "moribund after 6 years of austerity "?

    Actually to me it looks like that the greek economy was in a pretty bad shape well before "austerity", during the "boom years" because as this graph shows very clearly:

    in 1999 to 2008 greek GDP "grew" almost exclusively through booming imports of consumption goods financed by (mostly) german and french creditors, an import boom that reached nearly 20% of GDP.

    Also note that through the first 3 years of "austerity" 2008-2011 greek imports continued at amazingly high levels, even if they were decreasing.

    If austerity ended tomorrow, would greek GDP recover to the level of 2008 without another fabulous import boom? I have yet to see a good case that greek GDP could do that. Countries with a a much stronger business base than Greece have not gown their GDP at all since 1999:

    «SYRIZA failed not only strategically but also tactically. It did not touch the deep state structure»

    It is easy to forget that the topic of the negotiations with the "institutions" was that SYRIZA was trying to find some idiots willing to buy from them, with few strings attached, several dozen billion of euro greek bonds. Greek citizens have in Switzerland and in Greece's own banks enough savings to to that, but of course they are not stupid enough to buy their own government's worthless bonds.

    So SYRIZA's sales pitch was that the german government should force german citizens to buy those worthless greek bonds that SYRIZA cannot sell to their own citizens.

    Why didn't SYRIZA force greek citizens to fund the greek government with a land tax for example, that would result in rich greek citizens having to wire back some of their swiss money to pay the tax?

    Because SYRIZA wants to win the next elections, and making greeks pay taxes is a sure way to lose elections in Greece. So they have decided that their best option was to ask the german government to make german citizens fund the greek government, and thus shift the problem of losing elections to the german government.

    «A victory of the NO would block this course. [ ... ] will bolster popular confidence that the EU and the Greek bourgeoisie are not unbeatable and that another course outside the shackles of the EU is feasible.»

    Fantastic words. Have you got a few dozen billions of euros with which you are willing to buy greek government bonds with few strings attached? If you haven't, then too bad, talk is cheap.

    SYRIZA and the referendum and the NO campaign are a brilliant example of what Tony Blair in his social-dem days called "resolutionary socialism".

    Let's a pass a resolution called "referendum" to condemn people who don't want to buy a few dozen billions of greek bonds that greek citizens themselves don't want to buy! Let's word it harshly! That will teach them! :-)


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