In current discussions of what Greece might or might not get in the way of concessions from the Eurozone, there has so far been relatively little appreciation of one basic political reality: as far as the governments of Spain, Portugal, Ireland, probably Italy and perhaps even France are concerned, Syriza must fail and must be seen to fail.
So begins an article by neo-liberal economic guru Andrew Lilico in Wednesday’s Telegraph. Why? Well, because of the domino effect. Although no debt deal has been reached so far, if the other Eurozone finance ministers were to agree some kind of a compromise and bailout package with Syriza, then it is a near certainty that other European nations, starting with those suffering the worst of the “austerity”, would follow suit.
Here is Lilico to elucidate further:
The reasons differ slightly between countries. The easiest case to see is perhaps Spain. In Spain, the governing party is the centre-right Partido Popular led by Mariano Rajoy. It is currently facing pressure from a far-left party, Podemos, allied to Syriza. Indeed the Podemos leader Pablo Iglesias even campaigned in partnership with Syriza and, following Syriza’s victory, at his own party’s rally he proclaimed: “Syriza, Podemos – we will win [venceremos]!” Podemos is currently leading in the polls, ahead of an election later this year. The very last thing Rajoy can afford is for Syriza’s approach to be seen to succeed, emboldening and vindicating Podemos.
As for Portugal and Ireland, where the governments stuck to bailout conditions despite the domestic pain, how would they sell concessions to Syriza to their own voters? Suppose they go back and say: “We were suckers. We shouldn’t have made all those cuts. Instead, what we really should have done was to raise the minimum wage, hire back the public sector staff that had been fired, say we weren’t going to pay our debts to our eurozone partners, cosy up to the Russians and tell the Germans they didn’t feel nearly guilty enough about World War Two. Then everyone would have said we were ‘rock stars’ and and [sic] forgiven our debts.” Do you reckon that would go down well?
Lilico is horrified by all this, saying that he worries about “amateurish hard-left lunacy” which might somehow make, what he necessarily concedes is an already terrible situation, worse again. Not that Lilico is an impartial observer. He may write for the Guardian as well as The Telegraph, but that’s just how it works these days. The mainstream left and right merged long ago. So when he suddenly pops up to ward us away from Syriza, remember that he has his own interests to worry about. Potentially serious repercussions for his consultancy firm Europe Economics, which lists as its clients government departments, regulators, the European Commission and the European Parliament. With that in mind, here’s a little more of what he writes:
The best way for [Syriza] to fail would be for it to capitulate utterly and crawl back to Greece with its tail between its legs and a few cosmetic patronising “concessions” such as renaming the “Troika” the “Consultative Committee” (or, if it makes them feel better, the “Symvouleftiki Epitropi”). If it won’t do that — and there’s a good chance that if it did try to do that then the Greek government would collapse, anyway — then things get a bit more complicated. Because if it’s bad and dangerous for Syriza to succeed inside the euro, it would be disastrous for it to succeed outside the euro.
In short, Syriza must not be allowed to succeed under any circumstances, and although he may claim to speak “from the perspective of [the] eurozone governments”, it is more accurate to say that Lilico speaks here from the perspective of the bankers and the super-rich. For instance, in the hypothetic instance of Syriza’s success, Lilico predicts a calamity. This is what he foresees:
[Syriza] would nationalise the banks and many other industries, print money to cover public spending, overthrow property rights and impose wealth taxes in a desperate attempt to obtain revenue, and many other crazy things. 1
All these, at least to the mindset of Lilico and his powerful ilk, are “crazy things”. Thus, imposing every kind of tax on wealth becomes, ipso facto, a crazy thing. And as for “print[ing] money to cover public spending”, well printing money to bail out the banks is just fine, of course. That’s called Quantitative Easing which, combined with historically low interest rates (recently turned negative in some places), is all that’s keeping the ever more precarious Ponzi scheme afloat. So don’t be mistaken: what worries Lilico is not the unfettered overproduction of money ‘out of thin air’, but an awful dread that some significant part of this new money might be misdirected “to cover public spending”. Money for public expenditure instead of funnelled into the pockets the bankers (like almost all of the money from the previous ‘Greek bailouts’); to Lilico, this is unthinkable. As for “overthrow[ing] property rights”, well I’m really not sure what Lilico means, but I think the problem might lie in his inherent inability to see beyond a certain characterisation of Syriza. His own hard-right lunacy obscuring the fact that Syriza’s actual demands are both democratic and reasonable.
In the end it is the people who matter, and in Greece, the people are suddenly taking to the streets in droves. Not to shout down government injustices, but to add their own chorus of support. Yes, pro-government rallies without a can of tear gas in sight. Can you imagine? Lilico can’t.
However, the main trouble still facing the majority of us (the 99 percent) is that evangelists of loopy free-market, neo-liberal economics such as Andrew Lilico have been ruling the roost for decades. Intent only to smooth the way for business as normal, they are already the technocrats and they have a great deal to lose if the system were ever to be radically reformed. Unfortunately, these people are now embedded, and not only within ‘think tanks’ and ‘policy forums’, but also throughout academia, which in itself ensures any dissenting voice – anyone who does not fully subscribe to the current economic orthodoxy – is conveniently sidelined as a heretic.
Yanis Varoufakis is a perfect example of just such a heretic. A Professor of Economic Theory at the University of Athens, yet Lilico entirely brushes aside his alternative vision on the grounds that it is “amateurish”. For having cornered the market in supplying economic “expertise”, the likes of Lilico are very handsomely rewarded in their role as ‘consultants’: in reality, one of an increasing number of unelected and unaccountable architects of policy, who pocket a small fortune irrespective of results. Small wonder Lilico fears Syriza’s success.
Those wishing to see real political change should get behind Syriza. I suggest that we give those like Lilico good cause to keep on squealing.
The following statement and call for action is taken from the Greece Solidarity Campaign website:
The European Central Bank is trying to force the new anti-austerity Greek government to its knees. Its actions provoked mass demonstrations in Athens last week in support of the government anti-austerity stance. On Wednesday 11 February the Eurozone Finance Ministers have called an Emergency Meeting with Greece where Prime Minister Alexis Tsipras and Finance Minister Yanis Varoufakis will present their plans.
The Greece Solidarity Campaign, Syriza London and other organisations are calling for a Mass Rally in support of the people of Greece on Sunday 15th February at 13.00 in Trafalgar Square. This is part of an international wave of rallies and protests in support of Greece taking place across Europe. Come along with friends and colleagues to show your support for the first anti-austerity government in Europe.
1 From an article entitled “Eurozone leaders believe Syriza must fail and be seen to fail”, written by Andrew Lilico, published in The Telegraph on February 11, 2015. http://www.telegraph.co.uk/finance/11406154/Eurozone-leaders-believe-Syriza-must-fail-and-be-seen-to-fail.html