Donald Tusk and Jean-Claude Juncker in press conference after EU summit on Greece.Demotix/Sander de Wilde. All rights reserved. In an openDemocracy article a few weeks ago I argued there would be no agreement between the Greek government and the Troika. I took this position because it was (and is) obvious that the most powerful actor within the Troika, the German government, would not agree to any substantial alteration of the austerity program imposed on previous Greek governments.
As a result the Syriza government would have no choice but to abandon the euro zone and introduce a national currency. I was correct in my assessment of the inflexibility of the German government and its clients in the eurozone (e.g., Baltic countries and Finland) and the broader European Union (most obviously Poland).
Due to naivety and/or the triumph of hope over experience, I never entertained the possibility that the Syriza government would capitulate to the Troika. The capitulation arrived all the more unanticipated because the Syriza government surrendered to EU demands more draconian and more of an insult to national sovereignty than those rejected by 61% of Greek voters in the referendum on 5 July.
This post-referendum package accepted by the Greek government does not result in a Third Bailout. On the contrary, by accepting it all the Greek government has gained (if that is the operative word) is a concession by its euro overlords to begin negotiations for a Third Bailout.
The simple truth is that the European partners in the Troika, the European Central Bank and the euro zone finance ministers group, have conceded nothing of substance to the Greek government. Even the potential for another bailout remains extremely uncertain. The German government (led not by Merkel but by finance minister Wolfgang Schäuble) refuses to endorse any new funding for the Greek government without the participation of the IMF.
And further, the government in Berlin refuses to even consider reduction of the Greek public debt as long as Greece remains in the euro zone. For its part the IMF refuses to join any neo-Troika unless the main creditor of the Greek government, the ECB, grants debt relief. To weaken even more the potential for agreement among the so-called creditors, the IMF for its part refuses to ‘forgive’ any of the Greek debt that it holds.
Spectre haunts Europe
The conditions accepted by the Greek government to begin negotiations add the insult of sovereignty to the injury of austerity.
In his detailed annotation of the Troika terms,Yanis Varoufakis shows clearly their punitive nature and, more importantly, their rejection of democratic principles. The agreement requires the Greek government to clear with the Troika any policy proposal prior to informing the Greek population (full version on the EU website). This requirement signals the end of Greek democracy by any reasonable definition.
The role of the Greek parliament is reduced to rubber-stamping policies handed down by the Troika. This is nothing less than a deus ex machina conversion (with the German government assuming the role of deus) of a democratic institution into a body rather like the Consultative Assembly of Saudi Arabia. The substantive difference between the two powerless bodies is that in Saudi Arabia the monarch appoints all members. To date Greece's EU overlords have not made that a condition.
It is rarely fruitful to speculate on the motives driving extremist acts. The perpetrators almost always seek to rap themselves in the cloak of virtue. However, in this case Donald Tusk blew the Troika cover and revealed all. Mr Tusk is president of the European Council, described as follows on an EU website (bold in the original),
"The European Council brings together EU leaders to set the EU's political agenda. It represents the highest level of political cooperation between EU countries."
In pursuit of setting "the EU's political agenda", Mr Tusk cemented his right-wing credentials by stating publicly that "I am really afraid of this ideological or political contagion, not financial contagion, of this Greek crisis". Lest anyone miss his point, the former Polish prime minister went on to say that his concern was caused by the "radical leftist illusion that you can build some alternative" to the EU's neoliberal economic model.
He fears that this "illusion" resulted from "wide spread impatience", which could lead to "the introduction of revolutions" (all quotations from the FT article). Carthage posed an existential threat to Roman power in ancient times. For Mr Tusk and the Troika, the Syriza government posed a radical threat to the recently consolidated neoliberal eurozone.
The message of Mr Tusk and his colleagues in the Troika summons up an authoritarian equivalent of the famous passage that begins the Communist Manifesto (1848), in which he would substitute "democracy" for "communism" and "European Union" for "old Europe",
"A spectre is haunting Europe — the spectre of communism. All the powers of old Europe have entered into a holy alliance to exorcise this spectre..."
EU threat to democracy
Expect no "just peace" for the country posing a radical threat. The suffering imposed on the Greek people by the Third Bailout will not be "collateral damage". On the contrary, since Greek voters rejected Troika rule by a landslide, the Hellenic citizenry presents a threat far greater than the government it elected.
It must be punished to prevent a repeat of such democratic impertinence. I am in distinguished company in applying the word "punish" to extremism of the terms imposed on Greece. Germany's most famous intellectual and long time supporter of European integration, Jürgen Habermas, has described the conditionalities as "an act of punishment".
The European Commission has become the vehicle for preventing the anti-austerity uprisings that Mr Tusk considers so radical. By his reactionary clarion call for action to prevent democratic revolt, the president of the European Council harks back two hundred years, to 1814 when the monarchies of Europe gathered for the Congress of Vienna.
These powers convened to construct a barrier to the spread of republicanism, creating the so-called Concert of Europe, in effect a Concert of Monarchism, to maintain a united front across the reactionary states of the continent. Mr Tusk seeks a twenty-first century version to prevent progressive change in the European Union, a Concert of Neoliberalism.