economic crisis

Further reforms of the police apparatus are announced, but the relief is palpable. “For the first time in years I can move around freely in my own city without being frightened,” says Fereniki, who is part of the struggle against the privatization of the former international airport of Athens in Hellinikon.

But SYRIZA is not a revolutionary party — at best they can be labelled progressive social-democratic. Those who are now accusing the Greek population or even more so the Greek left to be reformist, are ignoring the consequences of the disastrous economic situation at hand. “To denounce SYRIZA as social-democratic was a luxury we couldn’t afford at that time,” Makis notes referring to aforementioned criticism.

Many activists assume that apart from the changes for refugees and the easing of the excessive repression the prospect of success for the SYRIZA-ANEL coalition is minor. The Troika’s influence on Greek economic policies is enormous and the options at hand limited: a continuation of austerity measurements as required by the EU would be disastrous – an exit from the eurozone probably would have even more devastating social and economic effects.

But blackmail is actually an understatement of what the troika is doing to Greece. It has become increasingly clear that it is trying to harm the Greek economy in order to increase pressure on the new Greek government to agree to its demands.

The first sign that this was the European authorities’ strategy came on Feb. 4 — just 10 days after the Syriza government was elected — when the ECB cut off the main source of financing for Greek banks. This move was clearly made in bad faith, since there was no bureaucratic or other reason to do this; it was more than three weeks before the deadline for the decision. Predictably, the cutoff spurred a huge outflow of capital from the Greek banking system, destabilizing the economy and sending financial markets plummeting. More intimidation followed, including a slightly veiled threat that emergency liquidity assistance, Greece’s last credit lifeline from the ECB, could also be cut. The European authorities appeared to be hoping that a shock-and-awe assault on the Greek economy would force the new government to immediately capitulate.

Remaining issues were to be negotiated by April 20, so that the final installment of IMF money — some 7.2 billion euros — could be released. One might assume that the Feb. 20 agreement would allow these negotiations to take place without European officials causing further immediate and unnecessary damage to the Greek economy. One would be wrong: A gun to the head of Syriza was not enough for these “benefactors.” They wanted fingers in a vise too. And they got it. The ECB refused to renew the Greek banks’ access to its main, cheapest source of credit that they had before the Jan. 25 elections. And it refused to lift the cap on the amount that Greek banks could lend to the Greek government — something that it did not do to the previous government. As a result, a serious cash flow problem has struck both the government and the banks. Because of the ECB’s credit squeeze, the government could soon find itself in a situation that the 2012 government faced when it delayed payments to hospitals and other contractors in order to make debt payments, and it could even face default at the end of April.

these cognitive problems will only matter if one of these people gets into the White House and still finds himself unable to distinguish myth from reality. By contrast, Europe is already suffering enormous pain because the people setting economic policy prefer morality tales to economic reality.

The tales of hardship are endless: an unemployment rate of more than 25 percent, a youth unemployment rate of more than 50 percent, a collapsed health care system. The European Union folks may not know much economics, but they sure know how to destroy a country.

Interestingly, even their morality tale is at best half-true. Greece was a profligate spender, but what about punishing the reckless lenders? They were largely bailed out by the European Union, the International Monetary Fund and the European Central Bank, who now hold the vast majority of Greek debt. What about punishing Goldman Sachs, which designed the swap that allowed Greece to hide its debt so it could get into the euro in the first place?

Clarity is important here because the European authorities, or the troika, as they are commonly called, plunged the eurozone into at least two additional years of unnecessary recession that began in 2011 because they were playing a similar game of chicken.

The showdown over the bailout is extremely dangerous, and obscures many serious issues that need to be dealt with in Greece and in the European Union as a whole.

The confrontation with Greece’s creditors can be seen as a clash between populism and dogma: on one side, a government that gained power by exploiting anger and despair; on the other, the creditor countries and organizations that insist on austerity even in the face of evidence that it is destroying a country and its people.

The first of many clashes between Alexis Tsipras and the status-quo powers concerns not debt restructuring and structural reforms but EU-Russian relations. A statement published on the January 27, 2015, claimed all twenty-eight leaders of the EU agreed that Russia bears responsibility for the rocket attack on Mariupol. The attack killed thirty people.

In this context, Alexis Tsipras’ expression of “discontent” at not having been consulted may have been justified. “The aforementioned statement was released without the prescribed procedure to obtain consent by the member states and particularly without ensuring the consent of Greece” the Greek government noted. “It is underlined that Greece does not consent to this statement”. Whether the oversight was intentional or a mix-up resulting from the transition of power in Greece remains unclear. That the new government of Greece will exert pressure in order to realign EU policies towards Russia should not however be in doubt.

What is more, EU pressure contributed to the failure in the privatisation process of one of Greece’s state-owned energy companies to a Russian-backed consortium. Subsequent criticism to the effect that Greece is not privatising assets at sufficient speed have sounded hollow as a result. EU sanctions on Russia are thus directly affecting some of the few dynamic segments of the Greek economy and have contributed, albeit indirectly, to SYRIZA’s victory in these elections.

The phenomenon of Syriza has captured the hearts and minds of European intellectuals. For many informed observers Greece is the prelude of tectonic changes that would shape future European politics, as there is a wave of elections in in 2015 countries facing similar challenges, including Portugal and Spain. The rising popularity of the Spanish ‘Podemos’ movement makes it plausible to see another party of the radical left gaining electoral support in the aftermath of the Eurozone crisis.

addressed the audience together promising ‘Syriza, Podemos, Venceremos’ (literally “Syriza, we can, we’ll win”).  So, should we expect a ‘spill-over’ of governing radical left parties in Europe or is, this, another Greek exceptionalism?

The tight external conditionality attached to the bailout is coupled with a limited timeframe within which crucial decisions need to be taken.

Hundreds of thousands of demonstrators — whom the world press refer to as los indignados — gathered in the square of Puerta del Sol in Madrid on 15 May 2011, protesting against the banks’ stranglehold on the economy and a democracy they felt no longer represented them. They outlawed flags, insignia and speeches on behalf of organisations and parties, and soon had a slogan: “United, the people do not need parties.”

Podemos’s creation stemmed from the realisation that “15-M [15 May] was locked in a social movement-based conception of politics,” said sociologist Jorge Lago, a member of Podemos’s citizens’ council, part of its wider leadership structure. “The idea that a progressive build-up of strength among the demonstrators would inevitably produce political results proved to be false.” Associations to fight tenant evictions and resistance networks against health sector cuts were established, but the movement ran out of steam and fell apart.

But what should happen when a government that social movements regard as over-timid comes under fire from conservatives? Should they play into their enemy’s hands by joining the criticism, or keep silent, betraying their cause? There is no easy answer to this.

The public consciousness is, at last, aware of the issues of financial regulation, wealth distribution and the means of production. But questions relating to religion regularly push these into the background (1).

Nikos Filis, editor of Avgi, a newspaper with, as main shareholder, the radical left coalition Syriza (2), came to a different conclusion: “The attack may orientate Europe’s future: either towards Le Pen and the far right, or towards a more reasoned approach to the problem. Because security needs cannot be met by the police alone.”

“If Syriza had been less intransigent on standing for the rights of immigrants, we would already have 50% of the votes. But this choice is one of the few points on which we all agree.”

An audit commission, composed of public auditors, economists, lawyers and other specialists, as well as representatives of civil society and organised labour, would look into why public debt was incurred, the terms under which it was contracted, what the borrowed money was spent on and seek to establish who was responsible for problematic debt agreements. "Such an audit would throw up some interesting questions regarding the legality - banks may have been lending in contravention of public debt rules of European debts," Jubilee Debt Campaign director Nick Dearden said.

Odious debt a legal theory that posits that the national debt incurred by a despotic regime for purposes that do not serve the best interests of the nation do not have to be paid back.

Any substantial repudiation of this debt would punch massive holes in the balance sheets of the banks in the core of the Eurozone that performed much of the lending, mainly German and French institutions. Similar effects would be felt by UK banks in the case of Irish lending.