Another Europe
The 2008 financial crisis threw European economies into turmoil and caused state debt to rise precipitously. The bureaucracy of the European Union in Brussels concluded that righting economic imbalances required indebted governments to implement harsh “austerity” policies. European states needing financial support or debt relief from the rest of the Eurozone were thus ordered to slash public spending and increase taxes. The resultant economic turmoil worsened by painful austerity has engendered a powerful wave of discontent with the status quo across the continent. Anti-establishment parties have made record gains in recent elections across Europe, most of them far-right nationalist parties campaigning against immigration and the EU. The exception is an oddball leftist political party from Greece, SYRIZA, or the Coalition of the Radical Left.
In 2015, rising poverty and unemployment and a rapidly declining standard of living prompted Greeks to vote SYRIZA into power on promises to renegotiate debt and eliminate counterproductive austerity. Since entering the spotlight in the Greek debt negotiations, many in Europe have been unsure what to make of the party or its goals. Many of SYRIZA’s opponents have dismissed the party as simply another permutation of nationalist “Euroskepticism”. But SYRIZA had a quite different political objective, one that would inspire a similar movement across Europe: To create a political alternative to both the EU austerity hardliners and the far-right nationalists.
Europe’s far-right parties themselves have had trouble understanding SYRIZA, with many congratulating SYRIZA despite the gaping difference in their ideologies. Matteo Salvini, leader of Italy’s far-right Euroskeptic Lega Nordo party, ironically praised the electoral victory of the radical left-wing SYRIZA as “a big slap to the European Soviet Union”. SYRIZA rejected their congratulations, angered to be conflated with nationalist Euroskeptics. SYRIZA and the right share nothing in common except harsh disagreement with Brussels. Party leader (now Prime Minister) Alexis Tsipras has called his party “an oasis in a desert…that wants to change Europe, not dismantle it”. Throughout SYRIZA’s participation in the Greek debt crisis, Tsipras has always stressed that his negotiations were for a continent-wide reform of the austerity system.
While austerity policies have only exacerbated the economic situation where they have been applied, Greece is perhaps the worst case study. The former Greek government initially enacted austerity measures to qualify for debt relief, but this only devastated the Greek economy, further increasing public debt. Some economists refer to the creditors’ philosophy as “extend and pretend”, pointing out the absurdity of giving more loans and austerity and then expecting Greece to then pay back its mounting debt. Even the International Monetary Fund, a major owner of Greek debt, has recently questioned imposing austerity policies and has called for write-downs of Greek debt.
Many economists ascribe Brussels’ intransigence on austerity to simple institutional stubbornness, as well as a self-serving fear that Europe would turn to anarchy if debts were restructured. Brussels is joined in its hardline push for austerity by Germany. As the largest and most stable European economy, the costs of debt relief largely fall to Germany. Giving German money to struggling countries is highly unpopular at home, so the German government demands adherence to austerity from other Eurozone member states.
Whereas far-right parties blame economic calamity on immigration and ceding national sovereignty to the EU, SYRIZA has placed the blame for Greece’s woes on this cyclical policy of austerity and issuing of new debts. SYRIZA recognizes the role of previous Greek governments that freely borrowed money and tolerated tax evasion, but the party insists on the need for continental cooperation to prevent the breakdown of the Eurozone.
SYRIZA’s example has inspired and popularized the left-wing Podemos party in Spain, which received 15% of the vote in the most recent elections. When TIME magazine placed Alexis Tsipras on their 2015 Most Influential People list for his continent-wide leadership, Podemos’ leader, Pablo Iglesias, wrote the biography. Tsipras’ widespread popularity is most evident in Italy, where in the 2014 European Parliament elections, an Italian party officially named L’Altra Europa con Tsipras (Another Europe with Tsipras) won 4% of the national vote. So when SYRIZA faced its greatest political challenge in the Greek debt negotiations, the outcome had repercussions across Europe.
In the now infamous debt negotiations, Brussels and Germany refused to accept any substantial reform or accord Greece any major change that would spare Greece social calamity, despite the growing popular mandate against austerity. German Finance Minister Wolfgang Schäuble reportedly went as far as to tell a meeting of European finance ministers on the Greek debt crisis, “Elections cannot be allowed to change anything.” Prime Minister Tsipras’ decision to hold a referendum on the poor terms offered and to then encourage Greeks to vote “No” on it perplexed much of the world. Other countries and political parties inferred that the referendum signaled that SYRIZA, like the radical-right nationalists, was against European unity and ultimately wanted what some commentators have called a “Grexit” from the Eurozone.
The referendum was indeed more than a question of support for the technical details of an economic deal. But rather than a plot to leave the Eurozone, it was in line with SYRIZA’s past campaigns for democratic European reform. Frustrated with the intransigence of Germany and Brussels on austerity, Tsipras wanted a no vote to be a broad rejection of the status quo, setting precedent not just in Greece, but also across Europe. In announcing the referendum, Tsipras denounced the inflexible demands of its creditors as being against “the values of our common European project” and declared that he hoped its rejection would “send a resounding democratic response to Europe and the world”.
On July 5, Greeks overwhelmingly voted “No” in the referendum on Brussels’ terms. As is common in Greek tragedies, however, after this triumph, Tsipras’ plan backfired disastrously. Tsipras had hoped that Greece’s decision would inspire other Eurozone countries to support Greek debt relief and austerity reform. However, dramatic reform would mean economic uncertainty, a fear that led the rest of the Eurozone to side with Brussels and ignore Greece’s pleas for reprieve. In the week before the referendum, the creditors enacted credit controls to coerce the closure of Greek banks, a punitive measure designed to force SYRIZA to cancel the referendum and capitulate. The referendum continued, but instead of forcing Brussels to accept change, the referendum angered the creditors into taking an even harsher line. The German Economy Minister quite aptly decried the referendum as “a rejection of the rules of the game of the Eurozone”, and his country would ensure that Greece did not change the rules of the game. If Greece’s referendum succeeded in winning the country concessions, it would set precedent for a Europe-wide reevaluation of austerity. Brussels and Germany thus increased their demands after the referendum, requiring tax hikes, a mass privatization of public sector businesses, and direct control over the Greek economic policy. There were to be no alternate rules in Europe, and Greece had to either accept austerity, or leave the Eurozone.
Despite Germany’s insistence that it merely defended the integrity of the Eurozone, German Finance Minister Wolfgang Schäuble repeatedly encouraged Greece to leave the Eurozone for the foreseeable future, preferring Grexit to compromise. Grexit could have meant not only the economic ruin of Greece, but also the possible dissolution of the Eurozone, and Tsipras wanted no hand in either. In the end, it was the ostensibly “Euroskeptic” Prime Minister Tsipras who chose to capitulate to the creditors’ demands to keep Greece in the Eurozone. SYRIZA did not want Greece to leave Europe. It wanted another Europe.
Germany and the Brussels bureaucracy maintain they are the rational backbone of Europe, weathering the storms of malcontent radicals from the left and right. But their stubborn insistence on the continuation of harsh austerity without debt write-offs is not only economically irrational, but encourages the far-right nationalism that threatens European unity. There is more than a little truth to Alexis Tsipras’ remark that “Austerity has led to the creation of political monstrosities”.
Since the 2008 financial crisis, austerity proponents have appropriated anti-immigrant nationalism to distract voters from extremely unpopular austerity measures. In Greece before SYRIZA took power, Brussels had a cooperative relationship with pro-austerity Prime Minister Antonis Samaris. In the 2015 Greek election campaign, when it became clear that SYRIZA was becoming popular for its opposition to austerity, Samaris began to campaign on a tough-on-immigrants line. After the Charlie Hebdo shooting, he notoriously commented, “In Paris there was an attack with at least 12 dead, and here, some [SYRIZA] welcome and even call for more illegal immigrants.”
There is no reason to think that Greece will be able to fix its economy or pay its debts after more crippling austerity, and a similar Greek debt saga will undoubtedly occur again. SYRIZA’s hopes are not yet dead, as the party will now try to help Greece cope with coerced austerity. If SYRIZA fails, who better to take up the anti-austerity cause than Greece’s other increasingly popular anti-austerity party, the highly xenophobic Golden Dawn party? Currently the third most popular party in Greece, Golden Dawn is openly neo-fascist and many of its leaders are currently on trial for a suspected role in murdering immigrants. It too seeks another Europe, albeit a far darker one. Germany and Brussels are playing with fire, unintentionally popularizing the rhetoric of the far-right, and if they refuse to work with left-wing reform movements, they must be willing to deal with the monstrosities that breed in their place.