If there had been any doubts about the meaning of the agreement reached by Syriza and the Eurozone, they were resolved by the publication on Tuesday morning of Greece’s proposals to reduce its deficit.
Panagiotis Sotiris has subjected them already to a detailed analysis and I will do no more than endorse the points he makes that Syriza has agreed to an absolute cap on the public sector wage bill (and therefore a wage freeze), the agreement weakens Syriza’s previous commitments not to allow the auctioning off of homes which are in debt, and it concedes in principle to the continuation of the privatisation programme including of workplaces which are central to the Greek union movement such as the docks at Piraeus
If anything, there are still more criticisms could be made. For example an English-language audience will be attentive to the implications of promises to “develop the existing scheme that provides temporary employment for the unemployed”, or to “strengthen the independence of the General Secretariat of Public Revenues” (ie. the Greek equivalent of George Osborne’s Office of Budget Responsibility) “from all sorts of interference (political or otherwise)”, in other words from attempts by an elected Syriza government to control its own economic policy. And in addition Syriza has given the troika, now relabelled “the institutions”, an unwelcome, express veto over any future increases to the minimum wage.
One writer who wishes Syriza well has cautiously welcomed the agreement saying that it “cancels the previous Greek government’s planned cuts to pensions”, which may be true, but the proposals tabled by Syriza still involve cutting pensions by reducing early retirement, and index-linking of payments in future. In any event, the right comparison is not with the plans of the previous government, but with Syriza’s own Thessaloniki programme on which it was elected. This had promised to restore the Christmas bonus for pensioners, and increase pensions thereafter (along with public sector wages) as a means to increase demand in the economy. Both of these promises appear to have been quietly shelved.
The most important part of the Thessaloniki programme were the starting principles of Syriza’s policy in regard to the Eurozone, ie that it would “write-off the greater part of public debt”, obtain “a growth clause in the repayment of the remaining part so that it is growth-financed and not budget-financed”, and “include a significant grace period in debt servicing”.
Now, of course, you can only reach a fair agreement in negotiations with someone who is willing (or compelled) to bargain fairly with you. And, Syriza’s negotating position was reduced even beneath any foreseeable position of weakness by Greek savers’ removing £12 billion from their bank accounts.
To grasp the enormous pressure Syriza was under, imagine a trade union which is trying to negotiate a pay increase from a hostile employer, while at the same time, its savings are separately being withdrawn from the union’s main bank account at the rate of about 10% of all its money every single day. Whatever other difficulties Syriza may have had, it simply did not have the ordinary negotiator’s option of stringing discussions along in the hope that something better would emerge.
Without falling into the ritualistic language of “sell-out”, it is not hyperbole to accept that the Greek government is being “strangled” or to compare it to “a debt colony with a bit of ‘home rule’”. Those, including 20 Syriza’s MPs, the speaker of the Greek parliament Zoi Konstantopoulou and Syriza’s chief economist John Milios, who have criticised Tspiras for trying to portray a defeat as a victory when it is in Milios’ words “suffocating” are right; no healthy politics, reformist or revolutionary, can start except from stating the facts truthfully.
How then might the harm of the last week be undone?
A return to the movements (with two notes of caution)
There is an almost universal desire on the Greek left, from the leadership of Syriza as far as Greece’s anarchists, to see a shift from the government to the social movements, so that it is the latter which initiate policy and the latter which control the former. How this change is conceived depends on the politics of the different groups.
Syriza itself to some extent supports the idea, and included within its Thessaloniki programme promised to “empower the institutions of representative democracy and introduce new institutions of direct democracy.” The detail of the programme included legislation to allow referenda, removal of MP’s immunities from prosecution, and a democratisation of radio and television broadcasting.
But there is potentially a much more inspiring version of the same vision in which the balance of forces within Greece is changed by the emergence within Greece of powerful social movements demanding a return to the sorts of politics which won Syriza the election.
This would the best next step. But I do have two notes of caution. First, merely seeing the best hope does not conjure it into being. Among socialists in the English-language world, there is still often a conception that Greece has enjoyed a continuous five-year period of open struggle, with widespread workers’ strikes, occupations, etc, and that therefore it is inevitable that any moment now, a social movement will emerge which will have interests clearly opposed to both those of their own government and those of the Eurozone. And yet the pages of indymedia Athens, or of the major Marxist organisations in Greece, whether pro-Syriza or anti, do not give an outsider the impression of a society on the verge of open ferment.
Second, it is important that the re-emergence of social movements is not abstracted from their politics. The last occasion when a social movement “broke through” to challenge austerity was during the revolution which took place in Egypt from 2011. This was a movement which for two years, like the great revolutions of France or Russia, seemed to constantly renew itself. It had a similar effect to Syriza’s election in terms of raising hopes internationally. At its peak, workers were involved in around 1000 strikes or protests every month. Yet, at the end of the revolution, the fatal moment was the emergence of a counter-revolutionary force “Tamarod” which portrayed itself, plausibly, as just another reform campaign. The form which the counter-revolution took was a series of public protests which were widely (and inaccurately) described as the largest demonstrations in history.
Socialism means democracy; it means the abolition of the present state and its replacement by one governed by the mass of producers. Any process which tends in that direction is always better than one that does not.
Yet in a context where very many Greek unions are linked to the political parties which been voting together in parliament against Syriza (ie New Democracy, Pasok and the KKE) more politics is needed than the simple analysis which says that we have had too much of government and now we need a syndicalistic return to the movements.
What Greece needs is something more specific a local counterpart to the huge numbers that rallied in support of Chavez against the 2002 coup and then radicalised and transformed his government, in other words a mass movement with a democratising dynamic.
Breaking with the Eurozone (but)
Syriza’s survival as a government will depend on it taking measures which could be seen as the beginning of Grexit, i.e. the introduction of capital controls, and limits to withdrawals from personal and corporate bank accounts. If it does not introduce them, then in four months’ time, Syriza will be faced with the same difficulties it faced in the last week, ie it will be nearing the end of negotiations with hostile powers, while money drains out of its banks leaving its negotiators without any leverage at all over Greece’s creditors.
Accordingly, increasing numbers of activist in Greece would not just agree with this analysis but go further, arguing that Syriza must take Greece out of the Eurozone altogether. If nothing else, the politics of Syriza’s isolation in Europe seem to compel this approach. At present, it is in a minority of one, and even in if Podemos wins the Spanish elections in November of this year, the radical left will continue to be a tiny minority among the governments, and will lose repeatedly.
But the vision of a Grexit without a change in the underlying social relationships was criticised by Antonis Davanellos of Syriza’s Left Platform, in an article from 2011:
“a return to the drachma, if it happens under the direction of capitalists and their state, would have devastating results for the Greek population. The drachma would be undervalued from the start and would instantly lose even more value when it is introduced. This would wreak havoc on the value of everything that is important to wage-earners (their wages, pensions, housing, etc.) and also farmers (the value of cultivable land). On the other hand, the capitalists–who would retain over 600 billion euros deposited abroad, more than twice the sum of the Greek debt–would be able to grab for just pennies public enterprises, hospitals, land and more”.
Those who know their history will recall how the solution to the German debt crisis in 1923 had exactly the dynamic that Davanellos cautions against, ie that inflation enabled a massive concentration of wealth within Germany, with the largest businesses buying up their dozens of their smaller counterparts on the cheap.
It also involved the impoverishment of Greece’s savers who then turned to the far right, which is not something that the leadership of Syriza, motivated as they are by the fear of Golden Dawn, will countenance lightly.
And the assumption that Davanellos makes that Grexit would lead to devaluation (and therefore inflation) is, notably, accepted by Grexit’s supporters, for whom devaluation is of course the mechanism to encourage increased foreign trade. A devalued currency is intended to sell its goods abroad for less, kick-starting the economy – but even to formulate the policy in these terms is already to see Grexit as a strategy for defending Greek business, rather than Greek workers.
Moreover a Greece equipped within an independent currency would not lose the economic problems which are weighing presently on its workers. Greece would still have a debt larger than its GDP; merely announcing “we will not pay any more” would not make the debt disappear unilaterally. It might be for example that an independent Greece would seek to trade occasionally with the European states which surround it. They, of course, would attempt to make trade conditional on the payment in full of the debts they are now enforcing.
The problem is not Grexit but the failure to attach it to transformation from one kind of society to another – from one ruled by its bosses to one ruled by its workers. Socialists often make this invocation, sometimes ritually, but this really is a situation where seemingly the same possibility (the departure from the euro) can have a wide range of different outcomes, from the most hopeful to the most desperate.
The vision has to be not the restructuring of capitalism, but its defeat.
So, there are two solutions, albeit neither is straightforward. Yes, Greece needs a return to the movements, but one which arms Syriza (and its left critics) rather than its opponents in the parliament or the Eurozone and one which changes the relationship between the government and the streets.
Yes, Greece needs to take steps towards Grexit, and possibly Grexit itself, but one based on a changing dynamic between classes within Greek society, rather than the mere exchange of capitalism in one continent for capitalism in one nation.