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The Permanency of the Left’s Defeat in Greece

After the painful capitulation of Greece’s Syriza led government to the impositions of the country’s European creditors, one point of consolation for Europe’s left has been “now we know who the enemy is.” Such is the darkness of these times that even this minimalist point must be denied any merit. This isn’t 2010 when the Troika first introduced itself as a creditor junta imposing austerity on a rattled and desperate PASOK government in Athens. Since then there’s been full scale bailout programs in Ireland, Portugal and Cyprus, a second program in Greece and a bank bailout program in Spain; all of these opportunities to witness the monstrosity that is the European Project in moments of existential crisis.

After five years of Troika politics how could a party of the left like Syriza put so much faith in negotiations with European creditors? Looking back over previous months and years it’s not difficult to see how much of the blame for austerity was redirected away from the Troika and at the various national governments merely operating within limits of Europe’s austerity regime. In Greece, this took the form of the Syriza narrative that the PASOK and New Democracy governments were ineffective negotiators. Vague language by creditors referencing debt restructuring was herald as a victory, even though the previous governments won similar vague commitments.

In Portugal, much of the left has fixated on the idea that prime minister Passos Coelho went beyond the Troika. Of course, Coelho built up this narrative himself but it was more image than substance; an effort to build positive publicity of a reformed Portugal that took the medicine without making a fuss. But one only has to look to the Troika’s call for additional measures like suppressing wages, curtailing collective bargaining, and pension ‘sustainability’ to see how much further the Troika wanted to go than the Portuguese government. Still, the idea of a prime minister more pro-austerity than the troika was too much for the left to resist, all the while structural explanations for austerity didn’t get the central focus they deserved.

The hope on the left is that after all these years of Austerity Europe, the capitulation of Syriza will finally build a left consensus on rupture with the euro. I think this is greatly mistaken. Much of Syriza’s capitulation has been blamed on yet another villain, again opting for figures to blame instead of structures. ‘It’s Schäuble who’s ruining Europe by trying to drive Greece out of the euro,’ the narrative goes. It can get extremely hyperbolic like France’s Left Front leader Melenchon arguing that the “German government is destroying Europe” for the third time in a century, conflating tens of millions of deaths with the end of an illusion that even modest social-democratic politics could coexist with the European Project. This doesn’t sound like a left learning from five years of experience.

The stance of Germany and other so-called creditor states rightly provokes outrage but it can hardly be considered a betrayal of Europe. Germany’s stance is aligned with the euro drafted in the Maastricht treaty: a currency union without fiscal transfers between member-states and limits on debt and deficits. The whole response to the outbreak in 2010 of the sovereign debt crisis has been an effort to reinforce that exact model for the euro. It’s of course a disastrous model that produces enormous economic suffering in the periphery, but it’s the model periphery countries signed up for and rule out leaving. The outrage committed by Germany has been the injection of national chauvinism promoting stereotypes of work-shy southern Europeans. This, coupled with the moralism of repaying the debt and fiscal discipline, builds up dangerous economic grievances framed on national lines.

This is where the permanency of the defeat in Greece becomes evident. Syriza for months witnessed the rigidness of the Euro Zone on debt and fiscal policy. It then called a referendum and locked in some of the costs that would come with a euro-exit like rationing bank notes, disruption to Greek industries, and a political crisis involving rival pro-govt and anti-govt demonstrations. Having endured some of the economic damage that would come with a Grexit, Tsipras doubled down on negotiations with creditors who then extract harsher conditions. This isn’t a retreat to regroup, this is the acceptance that there’s no alternative to being administrators of a creditor vassal state.

The situation offers a golden opportunity for Europe’s far-right. Right-wing and xenophobic euroskeptic parties can champion themselves as the only political force that is capable of saying no to the authoritarian liberalism of the European project. ‘The left is ideologically compromised’, they will argue, ‘choosing to keep intact the European Project rather than defend their voters from creditor impositions’. The far-right will get the chance to end the monetary union on their terms. The last humiliation for Europe’s left will be the emotional blackmail to close ranks with the EU to halt the far-right’s advance.

Europe’s Existential Crisis in Greece

Short of sending the gunboats, it’s difficult to imagine anything more Greece’s creditors could’ve done to intimidate voters into accepting the austerity ultimatum presented to their government. The weekend the referendum was announced, The European Central Bank froze support to the Greek banking system, forcing the government to impose capital controls. It’s a distressing experience losing a wallet, imagine being locked out of your bank account? That’s been Greek life for a week with a limit of sixty euros in daily withdrawals. On top of this, in a coordinated move European leaders made appearances or released statements saying a no vote in the referendum would mean a Greek exit from the common currency. To complete the blitz of intimidation, the Greek media and much of the international media took photos of every bank queue and empty shelf, all while circulating any rumor.

Despite all this, 61% of Greek voters delivered a resounding no on Sunday, painting the entire Greek political map one single color rejecting imposed structural adjustment. Hopes were suddenly dashed across European capitals and EU institutions for a yes vote that could pave the way for a technocratic government that would obediently implement whatever creditors proposed. European authorities are incredulous that after five years of telling Greeks that austerity was the sacrifice necessary to stay in the euro, Greek voters don’t believe another year and a half of cuts and tax increases will guarantee their membership.

This puts the whole European project in a moment of existential crisis. If it doesn’t accommodate Greece and continues using notionally independent institutions like the European Central Bank as a siege weapon on the Greek economy, it provides all the ammunition necessary for euroskeptic political forces to tear the project to sheds over the next decade. Alternatively, if Europe makes meaningful concessions to Syriza, it risks an electoral storm sweeping the south of Europe with elections this fall in both Portugal and Spain.

The designation of Alexis Tsipras as a radical and a threat to the European order speaks to the terror felt by Europe’s geographic and political center over any attempt to alter economic policy. Syriza has sought to renegotiate the 2010-2012 crisis response of deficit limits, austerity as precondition for “solidarity” loans, and full repayment of the debt. Creditors were able to extract these concessions from Europe’s periphery as the alternative, they argued, to expulsion from the euro and financial collapse. The streets of Europe resisted this settlement through social movements in 2011 and a pan-European general strike in 2012. Out of these social movements, parties like Syriza and Podemos would find a significant political base to build upon.

European leaders applaud themselves and the austerity regime for ending the financial crisis yet this is an outrageous act of historical revision. Forcing out Berlusconi and replacing him with Mario Monti, an unelected technocrat, didn’t end the sell-offs in Italian bond markets in 2011 and 2012. Only the intervention by European Central Bank president Mario Draghi to do “whatever it takes” ended the sell-off. Italy and Spain, with the backing of the ECB, avoided the full bailout programs seen in Portugal, Greece, and Ireland, but by then the social damage across Europe’s periphery was already done.

Seven years after the world financial crisis of 2008 double digit unemployment persists across Europe’s periphery (over 20% in both Greece and Spain), unemployed youth continue to emigrate en masse, a suicide epidemic has taken hold, and education and healthcare funding have been slashed. Opponents of austerity have rightly called this a humanitarian disaster that requires policy action to restore electricity and undo pension cuts for the most vulnerable. This is what Syriza was elected to do, and this is what European authorities consider incompatible with the European project.

Fear of an axis of leftist governments on Europe’s periphery left creditors with a perverse incentive in negotiating with the newly elected Greek government: they had to make offers Syriza couldn’t hold up as a victory. The talks went on for five months and concessions by Syriza weren’t matched by anything more than lower primary budget surplus targets, something regularly conceded to other crisis affected countries. Renegotiating the Greek debt burden stayed completely off the table while creditors insisted upon the Syriza government introducing pension cuts and tax increases, forcing the party’s fingerprints onto the austerity dagger.

Syriza thought it would have a better bargaining position in negotiations given the potential financial contagion from what would be the biggest sovereign debt default in history. It hoped to win support of center-left governments in Rome and Paris in negotiations, allowing it the policy space to implement a sort of humanitarian Keynesianism in Greece to address the worst human suffering from five years of austerity. But France and Italy were more interested in squeezing out what’s left of the post 2008-2009 global economic recovery than risking an open clash with Europe’s austerity regime.

This all now leaves Europe in a very dangerous position in the next few days, months, and years. In seeking Syriza’s total capitulation it may force the Greek government to reintroduce the Drachma. Punitively forcing Greece out of the Euro would make the European project permanently toxic for the left across the continent, leaving just the eroding political center to defend it. The sympathy toward Syriza by some in the Portuguese and French socialist parties speaks to how extensive the damage could be. Should Alexis Tsipras take Greece out of the euro he’ll be denounced as the radical who broke Europe, but the truth is this is a catastrophe by Europe’s extreme center; let them own it.

Europe’s Complacency Shattered by Fascist Violence and Continued Austerity

It’s as if Europe has passed the summer with its eyes shut and ears plugged, trying to wish away its profound social and economic crisis. It may seem like ages ago but it was just within the past year we’ve witnessed the bank runs in Cyprus, the pan-European strike that brought pitched street battles to Lisbon, Madrid, Barcelona & several Italian cities, and the determined effort by Catalans to achieve independence from Spain, threatening the dismantlement of one of Europe’s largest nation states. This was all meant to be forgotten; Europe’s crisis has come to end, we were told by policymakers. Greek & Portuguese prime ministers have spoken of recovery & German finance minister Wolfgang Schaeuble has assured us that Europe is being fixed. However, on Tuesday night, the fascist paramilitaries of Greek Golden Dawn reminded us that Europe is not just far from fixed, it is deeply broken.

On Tuesday night, those fascist paramilitaries attacked and pursued anti-fascist Pavlos Fyssas into an ambush where he would be fatally stabbed, living just long enough to identify his killer. Something is very broken here; broken so badly that Golden Dawn has been able to fatally assault migrants, carry out a homophobic siege on a performance of Corpus Christi, & just last week hospitalizing 9 communist party supporters with an assortment of crude weapons. Despite all of this, securing the dismissal of thousands of civil servants is still Europe’s most pressing concern when it comes to Greece, not dismantling this murderous neo-Nazi militia and its support network within the Greek police force.

Amid this fascist violence, record unemployment, decimated public services, and mass emigration from crisis hit countries, they still argue to us that Europe is being fixed. While they haven’t fixed Europe, they have manage to normalize a level of misery that would’ve been politically untenable just years ago. The mass mobilizations by indignant Europeans of the past three summer have largely melted away in 2013. Maybe Europe’s indignados have been broken by the many defeats of their movements to a European austerity policy that has gone unchanged despite the policy’s failure to reduce public debt & its rejection by the streets & ballot boxes. But this complacency isn’t sustainable. While the panic of Euro Zone collapse may have passed, the fascism and deprivation remain, and it won’t be leaving like the last dark clouds of an exhausted storm.

The political parties of the center-left and center-right will have nothing to offer voters for the foreseeable future. These parties only compete to prove that they will apply austerity at a slower rate than their rivals. The relevance of democratic elections is increasingly lost for more and more voters. It is in this political waste land where abominations like Golden Dawn and the National Front lurk. Europe can’t hunker down and attempt to wait out either the violent fascism on the streets or the endless austerity imposed by the Troika. Europe can’t avoid the inevitable task and responsibility of expelling these political actors from its political life. Waiting only leaves more victims behind, whether those victims are Spaniards who commit suicide at news of their home’s foreclosure, or migrants & leftists on the streets of Athens hunted down by fascist assassins. This is the broken Europe given to Europeans. Are they willing to keep it?

An Autumn of Discontent is the Result of Europe’s Endless Pursuit of Austerity

September was advertised as a turning point in the Euro Zone crisis, but after a week of mass anti-austerity protests in Spain, Portugal and Greece, the only thing I can take out of this month is that politicians are still unable to stop the continent’s unrelenting decline into social turmoil. Despite the efforts of the European Central Bank to stabilize the banking and monetary aspects of crisis, the recession deepened by austerity measures threaten any stability earned by central bank action.

Heading into October, Europe faces three trouble spots on its southern “periphery”. Like in previous years, Greece is nearing a confrontation both inside and outside parliament whenever the latest austerity measures are brought forward for a vote. The Greek state is in collapse with police turning residents to the fascist militia of Golden Dawn in crime disputes involving migrants. Social services are in free fall with the former ranks of the Greek middle class turning to charity services for food and medicine. This level of dysfunction being deepened by another round of painful budget cuts is too much for the Greek public to tolerate.

When the IMF recently pushed Greece’s finance minister to pursue more wage and pension cuts, the finance minister pointed to a bullet hole in the window and asked the IMF representative: “Do you want to overthrow the government?” Europe, again pushing for more counter productive austerity, risks sending Greece into a full nervous breakdown with unpredictable consequences. It’s not only EU and Euro Zone membership at stake, but the viability of Greece’s post military junta democracy and even the wider stability of the Balkans if extreme nationalists like Golden Dawn continue to advance into Greek mainstream politics.

While Greece is further along in a painful austerity program, Portugal is quickly catching up in terms of political dysfunction, public opposition to austerity, and an entrenching economic depression with no obvious exit. Any semblance of political stability in Portugal was lost in one speech by prime minister Passos Coelho when he announced a 7%  increase on the contributions of workers to social security. If that wasn’t politically explosive enough, he added that there would be a tax cut on the social security contributions of employers. The measures were justified by the prime minister in the name of economic competitiveness. A week later, around 660,000 protesters filled the streets in outrage over the government’s plans. A day after the protest, the crucial coalition partner in the government came out against the tax measure. The measure would formally die at a summit of Portuguese statesmen on the 21st of September. All of this still leaves the Portuguese government scrambling to find the billions of euros in budget cuts and tax increases needed to comply with the country’s IMF and European Union adjustment program. In a tactic borrowed from Greece, Portugal’s creditors have threatened to withhold loans if the austerity drive doesn’t continue.

While smaller countries like Portugal and Greece have been of sufficient concern to European policymakers since the crisis erupted, the deterioration of a country the size of Spain threatens to bring the whole European project crashing down on itself. Austerity has intensified long standing regional tensions in Spain with Catalans in the northeast desiring more political autonomy while the ruling Popular Party in Madrid and European Union seeks more centralization to eliminate regional budget deficits. The regional authorities in Catalonia threaten Madrid with a referendum on independence, while Madrid insists it has the constitution and national authority on its side in preventing a referendum. In October and November, Galicia, the Basque Country, and Catalonia all have regional elections, all three regions having longstanding and relevant nationalist movements. With a “bailed-out” Spain only promising additional rounds of austerity, the political center of Spain risks losing more voters to regionalist parties who promise a better future with stronger autonomy or even outright independence.

This retreat of the political center is happening across Southern Europe. It’s most obvious in Greece with once dominant parties like center-left PASOK polling 8% as opposed to the 43% it won in the 2009 general election. Following the latest austerity announcements in Portugal, the ruling social democrats lost 12% in just a few weeks with the Portuguese Communist Party and Left Bloc (ally of Greek Syriza) rising to 24% of public support. In Italy and Spain, voters are similarly shunning the parties that have governed for decades. Europe’s plan to keep the monetary union together depends on national politicians complying with austerity in exchange for loans. As we are seeing this autumn, the streets of Barcelona, Madrid, Lisbon and Athens are increasingly restive and ready to sweep those politicians aside.

Austerity Failing in Portugal Just as it Failed in Greece:

As reported by AFP:

“Portugal’s public deficit is expected to reach 6.7 to 7.1 percent of output for the first half of this year, far off the government’s target of 4.5 percent, experts commissioned by parliament said. ‘If this forecast is confirmed, the expected budgetary consolidation measures will not be sufficient to meet the budget deficit target’ of 4.5 percent of GDP for year end, the report sent to Portuguese parliamentarians said.”

And if one suspects that the first half of the year might be balanced out by a better performance in the second half, the same expert unit warned: “o perfil histórico do défice que tradicionalmente sofre um grande agravamento no último trimestre do ano.” Translation: the expert unit warns that “the historic trend of the deficit traditionally suffers a major deterioration in the final three months of the year.”

In Portugal, the cuts to social services, wages, and benefits failed to achieve their objective of balancing the public deficit, just as they failed before in Greece. Even if the measures worked in tackling the deficit, it wouldn’t justify the enormous social cost of unemployment and poverty. It’s time to break with austerity before it breaks us.

Screw the Troika, We Want Our Lives Back!

This is a call to protest made in the last few days by Portuguese activists for a new day of protest against what is known as the Troika (the International Monetary Fund, the European Commission, and the European Central Bank). You can find the protest and the original call in Portuguese here:

Que se Lixe a Troika! Queremos as nossas Vidas – Screw the Troika,  We Want Our Lives!

It is necessary to do something extraordinary. It is necessary to take to the streets and squares in both our cities and our countryside. To join voices and hands. This silence is killing us. The noise of the mainstream media fills the silence, reproduces the silence, spreads the network of lies that puts us to sleep and annihilates our desire. It is necessary to do something to reverse the submission and resignation, to do something against the filtering of ideas and against the death of the collective will. It is necessary to once again call upon our voices, arms and legs, of everyone who knows it is in the streets that the present and the future is decided. It is necessary to overcome the fear that is constantly spread and, once and for all, see that we no longer have much to lose, and that the day will come when everything has been lost because of our silence and our surrender.

The robbery (loan, help, bailout, names given to it according to the lie they wish to tell) came and with it the application of devastating policy measures that involve the exponential rise in unemployment, insecurity, poverty and social inequality; the sale of most state services, compulsive cuts in social security, education, healthcare, culture, and in all public services, cuts so that all the money can be transferred to pay and enrich those who speculated on the national debt. After more than a year of austerity under outside intervention, our outlook, and the outlook of the majority of people who live in Portugal, are increasingly worse.

The austerity imposed on us, and that destroys our dignity and lives, has failed and ruined our democracy. Those who resigned themselves to rule under the memorandum of the Troika give up the key instruments governing the country to the hands of speculators and technocrats applying a economic model that is based on the law of the jungle, law of the strongest, and neglects our society’s interests, our standard of living, and our dignity.

Greece, Spain, Italy, Ireland, and Portugal, countries held captive by the Troika and financial speculation, are impoverished and without sovereignty, as happens to all countries subject to this austerity regime.

Against the inevitability of this imposed death, it is necessary to do something extraordinary.

It is necessary to form alternatives, step by step, which starts with the mobilization of the public in these countries, and that Greek, Spanish, Italian, Irish and Portuguese citizens all come together in joint action, fighting for their lives and uniting their voices.

If they want to force us to accept unemployment, insecurity, and inequality as the new way of life, we will respond with the strength of democracy, freedom, mobilization, and struggle. We want to have in our hands the relevant decisions to construct a future.

This is a call to groups of citizens, and citizens from various areas of policy and political preference. We address ourselves to all people, collectives, movements, associations, non-government organizations, unions, political organizations and parties who agree with the basis of this appeal to come together on the street on September 15th.

They divide us to oppress us. Let’s join together to free ourselves!

With Eyes on Greece, Portugal is Slipping Further into the Abyss

Greece is approaching yet another episode of high social & political tension. The country’s foreign creditors are demanding full compliance with the austerity program after two elections in which anti-austerity forces shattered the ruling political consensus. Greece’s membership in the Euro Zone is again at stake with fears over the consequences an exit would have on Portugal, Spain, Italy, and Ireland.

But news within Portugal increasingly suggest the next domino in the Euro Zone is already falling. The latest official numbers show a program off track, with extensive austerity measures failing to offset falling tax revenue from a Portuguese economy deep in recession. The scenario is not that different from Greece. Portugal is set to miss the deficit target set out in the ‘bailout’  from the IMF and European Union. When Greece faced this scenario, it provoked accusations of Greece breaking commitments and furious demands for Greece to pass through additional austerity.

Now, Portugal, with all attention on Greece’s escalating crisis, faces its own judgment from foreign creditors. How those creditors address Portugal will indicate if there’s been any change of course in European leadership. According to the Diário Económico, the Troika (IMF, EU, ECB) will be updated on the worsening budget numbers and can mandate further austerity this year. Since the right-wing Social Democrats came to power last year, Portugal has been portrayed as an example to Greece. The question is now whether Portugal will receive preferential treatment for the sake of clinging to this myth. My guess, given the hardline taken with far larger Spain, Portugal should expect little lenience from its European creditors.