A United Syriza Moves Closer To Power

by James Elliott

The transformation of Syriza from 14 different parties into one, unitary organisation brings Greece a step closer to an alternative to austerity

First published: 07 August, 2013 | Category: 

The man who promises to end Greece’s austerity binge and reinvent European socialism for the 21st century has edged closer to power, after the radical left Syriza coalition of 14 parties merged into one unified bloc to fight future elections. Alexis Tsipras, the coalition’s leader, was elected head of the new party with 74% of the votes cast by 3412 delegates. 

Syriza won 71 seats in last year’s June elections, putting them as the second largest party in the parliament but 80 behind a majority. The remarkable rise of the radical left to within reach of electoral victory is akin to Arthur Scargill’s Socialist Labour Party merging with the SWP, Communist Party, Trade Union and Socialist Coalition and every other fringe leftist group in Britain to overtake Labour as the main party of the left. 

Should Syriza’s dramatic rise as a new radical left party continue, and should it win the next set of elections (planned for 2016 potentially much earlier), the global left will watch with intrigue as a genuinely socialist government attempts to wrest itself out of IMF-imposed austerity and break the neoliberal consensus. For this reason, the ex-SWP author Richard Seymour has called this a, ‘valuable step in a pedagogical process.’ The hypothetical questions of what the radical left could really achieve within a neoliberal Europe, whether they could reverse austerity with any success, and whether they could act as a sovereign and socialist government under the pressures of global neoliberal institutions like the IMF and EU, may all soon find answers.

Rather than continue the current austerity strategy, Syriza promise to make those responsible for the crisis actually pay for it. Michalis Spourdalakis, professor of political science at Athens University has said, ‘Syriza’s rationale and discourse is based on an analysis that the crisis is not simply the result of the shortcomings of the Greek political economy, but rather a by-product of the global capitalist crisis.’ 

This bold attempt to take on global capitalism on the national level would involve, according to Syriza’s head of economic strategy Yiannis Milios, clamping down on tax avoidance, raising taxes on Greece’s wealthy elite, and have workers take over production, running it in the long-term interests of all stakeholders, rather than the short-termism of foreign investors that blights economies, as costs and corners are cut to suit a profit margin. 

Whilst there exists a range of opinions on what Syriza could achieve, most leftists agree that sticking to the IMF-charted course into economic oblivion is the worst option on the table. The institution’s track record of ‘one-size-fits-all’ neoliberalisation of struggling economies is well known, and even top ‘establishment’ economists have made their criticisms heard. Most notably of all, the Nobel laureate Joseph Stiglitz has said the IMF, ‘champions market supremacy with ideological fervour’ and he holds the IMF responsible for a systemic failure to deal with economic crises, and in most cases actually exacerbating them, as it is doing in Greece. 

Stiglitz’s widely-read Globalisation and its Discontents follows the actions of the IMF since the ‘purging’ of the Keynesians in 1982, and their replacement with free-marketeers like William Clausen and Ann Krueger. He discusses how IMF-imposed privatisation and trade liberalisation in Russia after communism led to GDP being halved in just nine years, whilst poverty increased tenfold to 23%. Similarly, contractionary fiscal policies imposed on Argentina in 2000 led to a deepening of the recession, whilst the application of the same textbook neoliberal medicine after the 1997 East Asia crisis led to a 20% fall in real wages in the countries concerned. Stubbornly concerned with fiscal conservatism, the IMF cut food subsidies to the poor in Indonesia, supposedly to support a recovery. 

Stiglitz’s controversial slap-down of the IMF is ubiquitously cited, but he has his critics on the left. Economist and geographer David Harvey has astutely pointed out that the IMF’s disastrous record, now being continued in Greece, is not ‘merely the case of erroneous theory gone wild’ but a massive and deliberate upwards redistribution of wealth and consolidation of class power among corporate and financial elites. Of course, Stiglitz wouldn’t concede this ‘conspiratorial’ theory, as he himself was President of the World Bank, Chief Economic Adviser to Bill Clinton, and clearly a man of the establishment himself. You might well play down the cynical neoliberal objectives of the IMF if you’re a part of that destructive system, but the record Stiglitz lays out surely begs the question he doesn’t dare ask, and that is, who benefits from such obviously flawed policies?  

The same record Stiglitz damns is being repeated in Greece. Imposed by the ‘Troika’, the IMF, EU and European Central Bank, the ‘bailouts’ have come in two chunks. The first €110bn in 2010 came with terms, demanding that Greece privatise €50bn of its economy and impose other ‘structural adjustments’ in line with neoliberal economics, such as €28bn of spending cuts, to ‘trim the fat’, like social security, and other things people rely on.

It appears to some that Greeks had no choice but to swallow the IMF’s painful medicine, or they would have undergone a massive default, withdrawn from the Euro at huge cost, reintroduced a massively undervalued drachma, and then only been able to borrow at high costs due to a poor credit rating. What the neoliberals at the IMF have done, therefore, is to place a gun at the head of the Greek political establishment, and demand they privatise their railways, ports, water and energy utilities or face disaster, civil war, or revolution. 

The bailouts in Greece have had their beneficiaries, but only for the multi-national companies buying up state assets at cut prices, as happened in Russia’s ‘Wild East’ years, the decade of IMF privatisation that created Putin’s toxic mix of a mafia police state and crony capitalism. So it is that The Guardian reports Russia’s Gazprom, believed to be part-owned by the multi-billionaire autocrat Putin, has moved in on Greece’s national gas corporation, Depa, with a series of bids. Putin has recently called for developing countries like Russia and the other ‘BRICS’ to be given more voting power at the IMF, although given Gazprom’s newfound capacity for vulture capitalism in Greece, we can be sure Putin wants the IMF to remain as rigidly neoliberal as ever. 

The second bailout, of €130bn, was conditional on 50,000 public sector redundancies and tax rises, and was put through by the national unity government of centre-left PASOK and centre-right New Democracy. There are rumours of future bailouts, which might contain future privatisations for hungry corporations, but for the Greek people it would be best to avoid any further ‘structural adjustment’.

The effects so far have been dire. A 25% drop in GDP, 20,000 people homeless, and the UN weighing in to warn that IMF cuts may be threatening human rights. Austerity has left 10% of Greeks in extreme poverty, with unemployment and youth unemployment rates of 22% and 60%. It has given rise to the Nazi Golden Dawn, who polled at 10% last year and have assaulted other MPs, whilst democracy has come under greater threat from the closing down of the state broadcaster and the militarization of central Athens every time a member of the Troika flies in to review austerity’s reign of error. 

This is the devastation that Syriza are seeking to reverse. Their radical programme will rely on making the Greek elite pay, but how much can they achieve when supranational institutions like the EU and IMF hold all the cards and the chips? Alexis Tsipras is not yet Hugo Chavez, and this is certainly not oil-rich Venezuela. A socialism of the 21st century in Greece may remain a pipe dream - but its one the global left are desperately wanting to see come true.

James Elliott is a freelance journalist who writes regularly on foreign affairs and British politics.

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