Can Europe Make It?

Greece, August 2018: a mid-term report from a Syriza MP

"Are the critics of Tsipras right?  This is the first government in a European crisis country that will complete its full term. Look at the facts."

Costas Douzinas
20 August 2018
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Alexis Tsipras and Zoran Zaev attend a signing ceremony on the naming of North Macedonia, in Prespes, Greece, June 17, 2018. Dimitris Tosidis/ Press Association. All rights reserved.

How different does Greece look today compared to in January 2015, when Syriza, the radical left party, became the government. Between 2010 and 2015, Greece had lost 25% of its GDP, the debt to GDP ratio rose from 120% to 180%, unemployment was running at 27%, youth unemployment at 60%. Highly educated young men and women work in the NHS and wait in London restaurants. The dynastic power structure that had run Greece for forty years had finally brought it to its knees. Cronyism, corruption, tax evasion and avoidance had become the hallmarks of a failed party system.

The result of the bankruptcy was the biggest bailout program in recorded financial history and the most intrusive austerity policies imposed in Europe under IMF oversight. Syriza was elected in early 2015, against the wishes of a combination of Greek and European elites with a promise to reverse this situation. The outgoing right-wing government had not fulfilled its obligations under the second bail-out memorandum and had left state coffers empty. It was part of a plan freely admitted by its inventors to have the Syriza government collapse within a few months. The elaborately prepared ‘short left interval’ would disqualify the European Left for a generation.

Treason, failure, betrayal?

It became clear in those dramatic first months of 2015 that negotiations with the EU and the IMF were bound to fail out of intransigence. In July, Prime Minister Alexis Tsipras called a referendum and asked the Greeks to reject the latest European humiliating offer. The 61% referendum victory against virulent domestic and international propaganda was one of the most important instances of popular resistance in recent history. Tsipras, despite being armed with a large popular mandate, faced an unprecedented blackmail that became known worldwide with the Twitter hashtag ‘this is a coup’.  A third bail-out loan or Grexit were the two alternatives on offer. The Greek economy is import-based. Oil, much food and pharmaceuticals are imported; the cost of living, already down by an average of 40% would be devastated by the devaluation. Grexit would have been the perfect suicide note for the left government. Tsipras was forced to compromise, accepting a better deal than that rejected at the referendum.  It nonetheless continued the austerity agenda, abandoning many of the class-based Syriza promises.

In September 2015, Tsipras who had lost his majority called new elections disclosing fully the hard measures of the third austerity memorandum.  The Greeks chose Syriza, preferring a party that disagrees with neoliberalism to manage it instead of those for whom austerity is their declared ideology. Interestingly enough the July compromise is what unites conservatives, neo-liberals, and left-wing dogmatists, each group trying to capitalize on their version of the story: treason, failure or betrayal. 

Did Syriza betray its ideology?

Are the critics of Tsipras right? Fast forward to 2018. It is true that the western media, not great friends of the Left, tend to emphasize the problems a government under siege from domestic and foreign powers faced not always successfully. Yet this is the first government in a European crisis country that will complete its full term. Look at the facts. On June 22, European finance ministers announced that Greece would finally exit the bailout programs and the policies they imposed. The deal includes a significant debt restructuring plan, a moratorium on repayments for years and a return of the profits central banks made on Greek bonds. Tsipras delivered on his promise to “end the memoranda”, reduce the debt and start a new epoch for the country. On August 20, Greece is entering a new political era as it will regain its ability to plan and deliver on the government’s economic and social agenda. Austerity will not come to an end overnight. Greece will have to continue on its fiscal undertakings achieving high primary surpluses for a number of years. It will be under increased lenders’ observation to ensure that promises are kept; but its policies will be decided by Athens politicians not by anonymous Brussels technocrats. For the first time in eight years Greece will become again a normal sovereign state.

Will new Greece succeed?

The statistics give room for optimism. The economy is growing by 1.4% and the growth will continue in the next few years; the country attracts private investors - with names such as Tesla; government bonds spreads fell to before crisis levels, although the Turkish crisis has led to a temporary hike in the last few days; unemployment and youth unemployment, although still high, have fallen by 7% and 20% respectively. The government has drafted the first coherent economic restructuring plan moving Greece towards a knowledge economy. Government policies include reforms in higher education, an unprecedented focus on research and development (more than 1% of GDP in 2017), public investment in innovative private small and medium size businesses as well as in the social economy. The traditional sectors of tourism, agriculture and shipping have been extended to include graduates and scientists, currently unemployed or in flexible jobs in small and medium sized businesses. These policies and plans set Syriza apart from previous administrations and create a governmental model for the European left of the 21st century.

Class-based measures

There is more than just an improvement in statistics. Syriza, caught in a contradiction between left ideology and neoliberalism, managed to implement a number of radical reforms. On economic issues and despite the fiscal constraints, it did not abandon its class ideology. While improving the macro-economic performance, Syriza prioritized those who had been hit most. Early on, the government tackled the humanitarian crisis by providing free health care to over two million uninsured people; free meals to school children; a social solidarity income and subsidies for rent and transport for the poor; an end to family home repossessions and a restructuring of non-serviced private and small business loans. The antiquated, irrational and unjust social security system that could not support the pensions of an aging population was rationalized and amalgamated creating surpluses for the first time.

These class-based measures were complemented by a rights agenda vehemently resisted by the right wing opposition. It includes citizenship for immigrant children, LGBTQ civil union and fostering, gender reassignment, tackling racism and rising fascism, abolishing high security prisons and offering a dignified life to refugees. As part of its economic reform program, the government has tackled some of the persistent Greek anomalies: public revenues are rising, the dysfunctional tax collection mechanism is improving, tax exemptions have been reduced, high social inequality and the significant regional imbalances stabilized or reversed. The mid-term report reads, ‘done well in the circumstance should do better next term’.

A pillar of stability

On June 17, Tsipras was again in the headlines in another historic agreement. Greece and FYROM, signed a historic agreement which, when ratified by both sides, will resolve a festering decades-old dispute over the name of our northern neighbors. Claims to the classical Greek past will be put aside by North Macedonia while Greece accepted the existence of a Macedonian language and a designation of citizenship as Macedonian/citizens of North Macedonia. Nationalists on both sides, unfortunately including the main opposition parties, rejected the deal and have organized protests and rallies to overthrow the two governments helped by outside powers which view the normalization of the Balkans as a threat to their expansionist interests.  Progressives and the international community welcome this historic, mutually beneficial and carefully drafted agreement. It was the first time that a country accepted in an international agreement to change its constitutional name. The Agreement creates a model for addressing similar identity disputes across the globe with respect and dignity and opens the way for the creation of a Balkans of friendship, prosperity and solidarity.

The post-memorandum program includes an increase of the minimum wage, the return of collective bargaining and a return to labour law protections destroyed by the neoliberal memoranda. Public administration will be reformed with the full application of the rule of law, expediting the judicial process, enforcing court decisions against the state and major corporations and ensuring that senior civil servants are free of political influence. On the class front, an annual dividend will be given to pensioners and the low paid and will be supplemented by tax cuts to the lower and middle class starting the gradual reversal of the austerity measures. The social state that was seriously undermined by the austerity measures and the neoliberal dogmas of the right- wing will start being rebuilt. For the first time, Greece has an economic development plan grounded on redistribution and social justice.

Does this mean that all is well in the Hellenic Republic? Of course not. The recent devastated fires in Attica left 95 people dead and widespread destruction. The catastrophe showed that persistent absence of public services efficiency, lack of emergency co-ordination and planning coupled with anarchic private development that defied all safety regulations creates a toxic environment. The fires were an extreme example of all that is wrong with the Greek state and society. PM Tsipras undertook political responsibility and immediately put into effect radical measures to deal with the immediate effects of the disaster as well as long-term town and emergency planning.

Hope for the future

I was elected a Syriza Member of Parliament on 20 September 2015. I had not planned it, the idea had not even crossed my mind. I had lived in London since 1974. All my adult life and career had been spent in the protected and until recently gentle environment of British universities. It was a strange move from London to Athens and from the academy to politics.  Soon afterwards I was elected President of the Parliamentary Standing Committee on Defence and Foreign Affairs. Over the last four years, academic were replaced by parliamentary conferences, intellectuals by politicians and diplomats. In 2015, both politicians and academics treated Greece and me with irony and sadness. Today Greece is the most stable and respected state in the midst of a burning arc from Ukraine, through Turkey, Syria, Yemen and Libya. The Macedonia agreement proved that the Left, often derided as unpatriotic, is the only Greek political power brave enough to break the nationalist stranglehold on public opinion. The exit from the memoranda shows that the Left has the resilience and the ability to manoeuvre its way out of the memoranda asphyxiation without abandoning its ideology. Tsipras has become an internationally recognised statesman.

Much-needed European realignment

The 2015 defeat shows however that unless there is a change in Europe, isolated left governments cannot survive with their full program intact.  We need a realignment of left, green and social-democratic forces against the rising threat of nationalism, xenophobia and extreme right-wing. And we need a new social compact that will bring to an end the policies creating a fertile ground for such anti-European ideologies. The rise of Corbyn’s Labor, Spain’s Podemos, Portugal’s left social-democracy, Cyprus’ AKEL, European social movements and unions, DiEM25 indicate that Europe has started moving again in response to the model of ‘illiberal democracy’ that undermines our traditions. We should start a bottom up process aiming to reform European policies and institutional structures. A new progressive alliance should offer an alternative social and political vision: reduction of inequality, deepening and extension of democracy at all levels, growth social justice.

This is only a mid-term report. It can only be completed after another four years. Syriza, with its inexperience, inadequacies and failures, has created an important legacy for a restart of Greece and Europe. Its mid-term report gives progressives hope and optimism. 

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