Syriza, Scylla and Charybdis

Written by Nicholas Barrett on . Posted in Current features, Features

 

Henry Fuseli's painting of Odysseus facing the choice between Scylla and Charybdis

Henry Fuseli’s painting of Odysseus facing the choice between Scylla and Charybdis

Many of the greatest minds in politics and economics have, for the last five years, been consumed by the tragic plight of Greece. Now Syriza has stormed to power as the most radically left-wing government to be elected in Europe for 70 years. They are demanding debt relief and an end to the years of miserable austerity and they have the mandate to do so. But capitulation by their creditors could start a fire of left-wing populism across Italy, Portugal and Spain, (who would be encouraged to demand similar tolerance) as well as fanning the flames of right-wing isolationism in northern Europe. But what appears to be a Catch 22 may in fact be an illusion that challenges everybody’s perception of our political free will.

“Greece cannot payback its debt in full, even if Tsipras or any other politician wanted to” claims Evi Pappa, a Professor of Macroeconomics born in Athens during the rule of the military junta of the 1970s.  For her, the antidote can only come in the form of investment, “As Greece cannot count on the market for serving its debt and at the same time perform expansionary fiscal policies that would bring back Greek dignity, as the new prime minister put it, the only feasible alternative is the possibility of a new deal.”

Pappa is understandably worried about Greek exit from the Eurozone. She’s now making an effort to maintain her optimism, which is currently hinging on the abilities of Tsipras as a strong negotiator. “The government and many Greek enterprises that borrowed in Euros will be unable to pay” she warns “and this will create panic and a possible stop of payments. Couple this with the uncertainties about monetary policy and money printing. And what about a possible embargo of Greek products after a Grexit? What if people say ‘don’t holiday in Greece after they took our money and run away?”

Events are moving quickly and even discussing the possibilities is starting to feel as easy as drawing a map during an earthquake. As it stands, Berlin has hinted that there will be no debt forgiveness. Meanwhile, Tsipras has told his supporters that the age of austerity is over and that Greece will not default on its debts, telling his cabinet “we won’t get into a mutually destructive clash but we will not continue a policy of subjection.” But what seems like a story of an unstoppable force hitting an immovable object may lend itself to an unavoidable compromise that almost nobody wants. Greece may get a “debt holiday” to allow for some modest growth and could also be afford an extended period to pay back its debts. But it’s hard to know if this will be enough to appease Greek voters or whether Tsipras will risk further suffering in the pursuit of what has now become a moral and symbolic crusade against the perceived post-democratic dominance of neoliberal economics.

Professor Evi Pappa

Professor Evi Pappa

Pappa argues that Tsipras cannot have it all. He should get the best out of it, humanitarian help and some debt forgiveness in the short-run and new debt-linked to GDP growth for the longer horizon. At the same time, the new minister of Finance, Varoufakis, has to understand that the only feasible direction may be the unpopular road of structural reforms. For Pappa, output growth is what matters most to Greece and all the countries in fiscal troubles in the Eurozone right now. This would involve reforms that increase the competitiveness of exports, attract foreign direct investment, and promote product and service market deregulation as well as fighting corruption and tax evasion. According to Pappa, there is no point in rehiring unproductive low skilled public employees this says Pappas, would only serve to cultivate short term popularity. But the government could, she argues, gain greater support by finding ways to stimulate growth and help the unemployed (who now make up 27% of the population) to find productive jobs more efficiently.

The situation seems to be one of two competing dystopias.  For much of Europe, a Greek exit from the Eurozone would lead to more pain within the country and create economic chaos on the continent from which nobody would be immune. For Tsipras and his supporters, austerity is already a kind of dystopia but beyond that they are keen to echo a fear that if Syriza fail, the political momentum will shift towards the extreme nationalists.

Zoe Lefkofridi is a Greek Joint Jean Monnet-Max Weber Fellow at the RSCAS-EUI and Assistant Professor of Comparative Politics at the University of Salzburg studying democracy, representation and European integration. Like Tsipras, she’s worried about the potential of the far-right stepping in if the far-left were to fail on behalf of the Greek electorate and cites it as an incentive for Europe to listen. “I think there will be a deal” she explains, “because if there is none then they will have to talk to Golden Dawn afterwards and we’ve tried all the democratic ways out of this misery.”

Zoe Lefkofridi

Zoe Lefkofridi

But does this amount to a form of political or emotional blackmail? Evoking the fear of fascism always sounds sensational, not least when there is a general understanding that antagonists are German. So is this a serious threat or just a cynical ploy? When asked about this Lefkofridi is incredulous “when you have such high unemployment and the economy is damaged and there is no perspective, people radicalise. And when they see that no matter who you vote for there is no change then they distrust democracy so it’s very dangerous. It’s not a joke or a negotiating card, people are scared in Greece.”

On the night of the election Golden Dawn only garnered 6.3% of the vote, which was even less than they achieved in 2012. But this could be because Tsipras so successfully monopolised the county’s anti-austerity sentiments on a pro-European platform. If Syriza were to collapse then Golden Dawn could conceivably capitalise from a radicalised electorate that had been made to feel invisible in Brussels and Berlin.

They will have to compromise,” argues Lefkofridi, “this is the European Union it’s a system of compromises. I think if Greece gets out now this will be a very bad message for the rest of the member states, for the markets and for the eurozone. I don’t think anybody wants to take this responsibility and go down in history as the political class that destroyed Europe.”

Lefkofridi ponders the continent’s democratic design, which she claims has made politicians too parochial and turned Brussels into an international rhetorical scapegoat. “National parties” she says “are dependent on their own electorates and they’ve done a very bad job selling Europe to the people because they took credit of the achievements and blamed failures on Brussels.” It is for this reason that Lefkofridi has become an advocate for synchronised national elections, which as she admits, sound like “science fiction” but aim to make the EU more accountable and inclusive. “At this point of economic integration, if you don’t have democratic integration you have a democratic deficit.”

Syriza also argues that Europe is founded on a principle of democracy and that if the Greek electorate are ignored then the EU may have to reconsider its ideological identity. This is a powerful idea and it’s conceivable that almost any action could be undertaken to defend it in the name of the desperate Greek people.