Sunday, July 05, 2015

Greece, Democracy and Social Action

The people of Greece have just done something remarkable. They have defied the dictates of the oligarchs and bankers and said “no” – we actually want to live decent, meaningful lives out of poverty – especially a poverty imposed on the basis of failed policies, acknowledged as failed by the very people who imposed them – the IMF.

Think about this: over 50% of the young people of Greece aged between 16 and 24 are long term unemployed; overall unemployment is at 25%; food consumption in Greece has fallen by a quarter over the last five years and there is a sense of growing despair about whether or not there is a future.

The options before the Greek people were: (a) reject the deal offered by the EU/IMF/ECB and face dire consequences now; or (b) accept the offer by the EU/IMF and ECB and face dire consequences for a really long time with a growing loss of control. The Greek chose to challenge the system.

What happens next is anyone’s guess. The sensible thing to do would be for Greece to exit the Euro, devalue its currency and default on all of its loans. That is “do an Iceland”. Getting control back of their currency and their economic levers is key to their future. Leaving with the EU/IMF/ECB would be a disaster.

It will all be very messy for a while. But in the end, Greece can come out of the other side of this.

It has made a good start: using democracy to make decisions. While this is an anathema to Mrs. Merkel and her allies, it starts to raise questions about just how decisions get made. If Spain elects its own anti-austerity party and follows a similar course, we will see the end of the Euro and a shift of substance in Europe.

David Cameron, the British Prime Minister, will be watching carefully. He has promised an in/out referendum on EU membership for  the UK. He is campaigning for reform of the EU and all of this may just be helpful to his cause. It certainly creates spaces in which he can weave a plan or plot.

What happens in the next few days will be crucial, not just for Greece but for the Eurozone and the EU. Keep a keen eye.

1 comment:

Alex Olteanu said...

What happened in Greece is not democracy it's fear-fuelled populism by a demagogue desperate to shore up his power base. A plebiscite organised in less than a week with a convoluted question and no real debate on the issues and their implications is nothing more than a thinly veiled attempt to blackmail the European institutions to give in to entirely unreasonable demands by a Greek government caught between the anger of the Greek citizens and the sanctions of the EU institutions. This is not 21st century democracy, it'1920s hyper-nationalism.

Of course the EU needs deep reform - but not by destroying it or emasculating it "a la Cameron": rather, by dealing with its "legitimacy gap" and creating truly pan-European institutions that can reach truly democratic decisions about the well-being and future prosperity of all European citizens. Tsipras is just the latest pied-piper leading the way down a dangerous path Europe has been before too many times.

The light you see at the end of the tunnel is not that of freedom - but of Putin's incoming tanks. By confusing populism with democracy and the collapse of the EU with some mythical "rebirth"of state sovereignty we are doing nothing less than setting ourselves up for a 21st Century that will will be an even more disastrous replica of the 20th.

So be careful what you wish for - you may just get it.... ;)