SYRIZA's only chance

Agora Contributor: Nick Malkoutzis

“We want people on the streets, we want you to protest,” SYRIZA leader Alexis Tsipras told the crowd at his last campaign speech in Athens on Thursday. He and his party envision that popular will can be the rising tide to lift SYRIZA in its battle with the troika and struggle to tame domestic opponents. The thinking goes that if the people are visibly on SYRIZA’s side its bargaining position will be impregnable.

This is the dream, at least. The nightmare is that people will be on the streets protesting because of the failure of a SYRIZA government to reach an agreement with Greece’s lenders, leading to the European Central Bank putting a stop to liquidity. It is a scenario in neither side’s interests but that does not mean it cannot happen.

This is why SYRIZA has only one chance – and very limited time - to get it right if it forms a government next week. If it starts negotiations with “European institutions” (it says it does not recognise the troika) by expecting that it will be able to win a political debate, its chance will vanish in an instant. While the decision about what to do with Greek debt, fiscal targets, reforms and liquidity is largely a political decision at the European level, political arguments from Greece cannot have a decisive impact on the debate. If a SYRIZA government bases its demands on the “humanitarian crisis” in Greece and the “fiscal waterboarding” its people have suffered, it will be shown the door and told to come back with a more convincing argument. Greece can only win over European decision makers by making it clear what it has to offer first.

While SYRIZA’s arguments regarding the importance of debt sustainability and the irrelevance of further supply side reforms in Greece’s current plight have merit, these are issues that can be settled over the medium- to long-term. The pressing financial constraints Greece is under mean that it needs the eurozone on its side in the short-term. Perhaps the only way that SYRIZA can secure this support is offering to be bolder on certain reforms than previous governments.

SYRIZA’s focus has to be on deep structural and institutional change. It needs to focus on the areas where the previous governments did little or nothing at all. If SYRIZA shows itself to be determined to overhaul Greece’s chaotic justice system, to improve the efficiency and accountability of the civil service, to make the tax collection system truly independent and ruthless, to increase political transparency, to investigate party and media funding and to tackle corruption in the dealings between the public and private sectors it will have a basis for discussion with Greece’s European partners.

As a newcomer to government, SYRIZA can argue that it is not the prisoner of vested interests in the ways that PASOK and New Democracy were. It can argue that it is able to venture into territory previous governments did not – such as the “triangle of sin” that economist and SYRIZA candidate Yanis Varoufakis spoke about recently - because they wanted to protect their friends, oligarchs (and others) that Alexis Tsipras spoke about to the New York Times.

Of course, to take on this daunting task SYRIZA needs a clear plan and unyielding political commitment to such a project. The fact that the idea of doing many of the things described above have only entered the party’s campaign language in the last few days suggest that neither of these two elements are in place. There is a suspicion that SYRIZA’s rise to power will simply usher in a new set of friends and cronies (some who retreated into the background in the last few years) and that Greece’s wheel of misfortune will simply keep on spinning.

Maybe there is still a narrow window of opportunity for SYRIZA to address this. If it is able to speak this language convincingly then perhaps the key eurozone players will be willing to listen. Ultimately, SYRIZA would need their support if it is going to embark on this project as the vested interests will not sit idly by while their kingdoms are brought to the ground. An agreement on these changes could form the basis of a conversation that could later include the debt relief and economic stimulus that SYRIZA has placed at the top of its agenda.

In fact, if SYRIZA really wants to seize the opportunity it has been given then the best service it can offer to Greece is to deal with the deep-rooted malaise in the public administration and political system. This will offer Greece a sounder platform for the future than a reduction in the public debt or a faster rate of growth. In fact, securing the last two without the first will only lead to Greece ending up in the same place it is now sooner or later. If SYRIZA is serious about wanting to make history, it has to prove it straight away. It won’t have another chance.

Follow Nick: @NickMalkoutzis

7 Comment(s)

  • Posted by: Dean Plassaras

    Another version, hardly heard in the early days but far more credible today, is that the crisis is the result of Germany's irresponsibility. Germany, the fourth-largest economy in the world, exports the equivalent of about 50 percent of its gross domestic product because German consumers cannot support its oversized industrial output. The result is that Germany survives on an export surge. For Germany, the European Union — with its free-trade zone, the euro and regulations in Brussels — is a means for maintaining exports. The loans German banks made to countries such as Greece after 2009 were designed to maintain demand for its exports. The Germans knew the debts could not be repaid, but they wanted to kick the can down the road and avoid dealing with the fact that their export addiction could not be maintained.

    Read more: The New Drivers of Europe's Geopolitics | Stratfor
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  • Posted by: Dean Plassaras

    Tsipras would prove to be a total idiot if he continued the Troika reforms. Those under the illusion that Greece should submit to further reforms better hit the books and fast.

    In fact the Syriza promise is that you should forget about nonsense.

    http://www.nytimes.com/2015/01/26/opinion/paul-krugman-ending-greeces-nightmare.html

  • Posted by: Klaus Kastner

    For once, I am a bit more optimistic than a Greek commentator. Why? I have observed an incredible shift in support for Tsipras outside of Greece. Even in Germany and Austria. Yesterday, one of Austria's best known economists arranged a public demonstration in Vienna in support of SYRIZA. A feeling is developing like every decent human being is obligated to support SYRIZA. I watched a debate on Austria's public broadcaster last evening. Four participants: Heiner Flassbeck, an EU parliamenatarian, a well-known author and --- a conversative Austrian banker who got to speak last. Poor man! The first thing he said was "I get the feeling that we are the cause of all of Greece's problems". He remained an outsider throught the debate.

    Maybe this is just a flash in the pan out of the emotions of the moment. Maybe not. If not, Merkel & Co. could find that their greatest opponent is not in Greece but much closer to home.

    • Posted by: H.Trickler

      I do not think Nick Malkoutzis being pessimistic, but fully realistic.

      The new melodies we hear from EU, Germany and Austria might be the consequence of the clear voting result in Greece, and to some degree the late insight, how badly the previous Greek governments had implemented so called reforms...

      It will be very interesting to see how Tsipras will launch the gargantuan task of reforming Greece. Unless he does it in an efficient and reasonable way, his term will end as abruptly as it started.

  • Posted by: Dean Plassaras

    Merkel did it again. First she created Syriza and today she triumphantly installed Syriza in government. The chicken have come home to roost. Now she has to deal with her baby. Any inability of Syriza to be cohesive or effective ought to be directly attributed to the woman that put Syriza where it is today. Good luck Angela. One of these days you may what to explain as to why you engineered these early elections.

  • Posted by: Anthony Staines, DCU

    I've watched the video you linked to. I'm familiar with the health of the Greek children, and I agree with Yanis Varoufakis that unless the humanitarian issues are dealt with, and dealt with effectively, there will be no deep reform.

  • Posted by: H.Trickler

    We will have to wait and see. "SYRIZA’s focus has to be on deep structural and institutional change. It needs to focus on the areas where the previous governments did little or nothing at all."

    This indeed is the crucial point. And I wonder why in the past 3 years this basic truth had not often been published in ekathimerini or this blog.

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