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  • People of Greece Shake Europe

    Costas Lapavitsas: The growing strength of the left shows the Greek people are getting ready to leave the Eurozone -   May 7, 2012
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    Costas Lapavitsas is a professor in economics at the University of London School of Oriental and African Studies. He teaches the political economy of finance, and he's a regular columnist for The Guardian.


    People of Greece Shake EuropePAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington.

    "Greek politics is in turmoil," say headlines of newspapers across Europe. And why? Because the Greek people in the recent election rejected, more or less, the parties that had signed on to the bailout and austerity measures. No party is big enough to actually take power, so it's not clear what happens next.

    Now joining us to talk about the significance of the Greek elections is Costas Lapavitsas. He's a professor in economics at the School of Oriental and African Studies at the University of London. He's a member of Research on Money and Finance. He's a regular columnist for The Guardian And he has a new book coming out, called Eurozone in Crisis. Thanks for joining us, Costas.

    COSTAS LAPAVITSAS, PROF. ECONOMICS, UNIV. OF LONDON: Thank you for the invitation. It's a pleasure to be with you.

    JAY: So, quickly, what happened in the elections? And then tell us where are we now.

    LAPAVITSAS: Two things happened in the elections, both of which are very, very important. First, the Greek people, who were asked for their opinion about what's been happening to them for the last two years, they've expressed their democratic right to decide what's going to happen to their country. That's the first thing that happened.

    The second thing is, when they expressed their views, they rejected all political parties that either supported or tolerated the bailout agreements and the austerity imposed on the country as a result of that. They rejected this without question, without doubt. This is the true significance of the election. Any party that was prepared to criticize and to oppose what has been happening to the country in the last two years and to say that the deal imposed on the country as a result of Europeans and IMF pressure was bad, any candidate who did that benefited, gained substantially.

    JAY: Right. Now, the surprise, apparently, according to the press, anyway, was the left coalition, which did much better, I think, got 16, 17 percent of the vote.

    LAPAVITSAS: Yeah, that's right. Basically what happened in Greece was that the middle fell out of the political spectrum. Greek people moved away from parties that positioned themselves in the middle of the political spectrum because these parties were seen as supporting the bailout agreement, and they moved to the left and to the right. As they moved to the left and to the right, they gave more of their support to the left. The elections are good for progressive politics in this regard.

    JAY: So what happens next? The two main parties—what is it? New Democracy and PASOK. Neither of them—both of them supported the European bailout conditions. Neither of them have enough seats, even together, to form a government. If I understand it correctly, the Left Party is saying they won't join a coalition with the pro-bailout forces. So what happens?

    LAPAVITSAS: What happens is most likely instability. Greece is unlikely to have a government, even formally, for the reasons that you point out, and also because the anti-bailout parties do not have enough votes to form a government among themselves, not least because they contain a fascist party, which has a substantial MP—parliamentary representation at the moment. So it's most unlikely that Greece will be able to form, formally, a government.

    Even if it did that, however, even if a government was somehow concocted out of what exists at the moment, this government would be very, very weak, and it would be impossible for it to effect all the measures that the bailout agreement requires it to. And above all, it would be impossible for it to bring in the cuts that the government's supposed to take in June. This is what the bailout predicted. And I just do not see how any Greek government can do that right now.

    JAY: So they're threatening another election soon. And some of the quotes I'm seeing in the newspapers are saying people are saying, well, we sent a message to Europe, but we're scared, we don't know what happens next. So what is it? They're going to call another election and they're going to threaten disaster—although I assume that's what happened in this election, they were threatening disaster. And people still rejected this bailout.

    LAPAVITSAS: I think that an election might well be called. In fact, constitutionally it will have to be called if no formal agreement or some other mechanism is put together to have a government in place in the coming few weeks. New elections will have to be called for sometime in July, probably. And in that context what is likely to happen is that the SYRIZA Party, the party of the left that came second in the election [behind] the clear winner of this election, is likely to do even better, and it is likely to do even better because, I think, first, because the Greek electorate is—yesterday took a major step. It actually voted en masse for a party for which it had never voted before. If this party of the left plays its cards right in the coming weeks, should there be another election, my expectation is they will do even better and Greece will move even further towards rejecting the bailout [crosstalk]

    JAY: So tell us more about this party. Who makes it up? And what is their program, in terms of what they think is the strategy for the crisis?

    LAPAVITSAS: This party's a coalition of various organizations of the left. It has been about for 20 years. It contains some people who came out of the Communist Party many, many years ago. It contains people from all sorts of other parties of the left, of the Democratic left and so on. It has always tried to find a different path for socialism and for social transformation in Greece. It's a party that has in good measure supported the European direction taken by Greece and by Greek society and economy. Many of them are ardent Europeanists, pro-Europe people. This party has a program or has developed a program during the last few months which basically says that they will default on the debt, they will have an audit commission on the debt, and they will aggressively seek debt write-offs. That—in this way they will provide debt relief to Greece. On top of it, they will then go for income and wealth redistribution, and they will also go for industrial policy to restructure the productive sector of the Greek economy. All this they maintain that they can do while remaining within the monetary union. In my judgment, this is not possible. If they begin to apply their program, if they find themselves anywhere near government and they begin to apply their program, they will very rapidly realize that membership of the monetary union will be on the table. So in effect Greece yesterday took a first and decisive step towards getting out of monetary union in political terms.

    JAY: And this is—do the Greek people understand this? 'Cause there seems to be so much confusion.

    LAPAVITSAS: Indeed. The Greek people at the moment, the electorate at the moment, presents a mixture of two things: enormous anger with the existing political parties brought it to this—brought the country to this pass; enormous anger at what has been imposed on the electorate in terms of income cuts and so on. But at the same time, the electorate is confused. It doesn't really know what might be a good solution, a decisive way out of this. What you saw in the election results yesterday is a mixture of these two things, anger and confusion. So people were prepared to vote for this SYRIZA Party because it expressed its anger very powerfully.

    Now, within that, SYRIZA was very careful not to raise the issue of the euro, because it knows that exiting the monetary union is something that scares people. It's something that people do not wish to see. So they've kept quiet about it. In my view, this will not wash, this cannot be maintained, and instinctively people will—already realize and will realize even more that if the program of SYRIZA is put in place and made reality, then membership of the monetary union will also become an issue that goes straight on the table.

    JAY: Now, in France, the new president, Hollande, made speeches that he's going to take on finance, he's against austerity, it's time for a change of direction for Europe. He was practically talking like he'd been elected president of Europe—or non-Germany Europe, at any rate. And now with the election in France, there's lots of discussion about is this really going to be a change for Europe. What do you make of Hollande, and is that really—is it really significant, his election?

    LAPAVITSAS: Let me say first of all that what's happened in Greece is similar in many respects to what happened in France, although, of course, Greece is a more extreme case. In fact, it's similar to what's been happening in country after country in Europe. Europe went on this austerity drive and neoliberal drive two years ago. Many people argued that it was a great deal of nonsense, but Europe nonetheless did it and went down this path.

    The result of the austerity drive has been to put working people, wage laborers, and also a lot of middle-class people, self-employed, and small and medium business owners under enormous pressure in Europe. When that happened, the center fell out of politics, basically. The European electorates in many, many different countries moved away from the center and strengthened the left and right. This you see across Europe. The extreme right and the extreme left have benefited from this. Now, Hollande in France expresses this move in the French context, shows that the French people want some radical answers, some radical solutions.

    Now, I don't trust him, personally. I don't trust and I don't believe that he will do half [of what] he argues he will do. Nonetheless, his election's very important, because it shows that the tide might be turning in Europe. It shows that political changes might be put in place that will lead to better results in the near future. Let's wait and see.

    JAY: And just to finally—the right-wing, far-right movement, neofascist movement in France, this is nothing new, although it's gained in strength in the last—in this last election. In Greece, many of the Greeks being interviewed seem somewhat surprised by the strength of the far right in these Greek elections. How significant is this?

    LAPAVITSAS: It is the same pattern that we've seen across several other countries in Europe. Greece is not exceptional in these respects. What is exceptional is the strength of the outright fascist components of the extreme right. The authoritarian and nationalistic right gained enormously in Greece. But on top of that, the straightforward fascist right also made significant gains, very significant gains. I think this—.

    JAY: And these are people that are using a Hitlerite salute and actually something somewhat akin to a swastika as a symbol.

    LAPAVITSAS: That's correct. I think they are straight fascists who made significant gains because they took a virulent anti-immigrant position. They blamed immigrants for a lot of the problems of the country, and they also blamed immigrants for the breakdown in law and order that many people appear to experience in the large urban centers. They also participated actively in various mechanisms that offer people support in the humanitarian crisis that the austerity has brought to the urban centers, particularly in Athens, so they benefited from that. They have dressed all this up in an anti-politician, anti-corruption, nationalistic rhetoric. And people have gone for them. People have gone for them. These are phenomena that we last saw in Europe on this scale in the Weimar Republic. This is what the austerity policy appears to be creating in Europe, a reemergence of the Weimar Republic.

    But I don't wish to overstress the importance of the fascists, bad as this is. The real winners of the election in Greece yesterday were the left. Really, the Greek people said that they want a solution in the direction of the left, not to the right, yesterday.

    JAY: Well, in the late 1920s, the left in Germany was very powerful, and the rise of the fascists and Hitler had significant backing within the German elites. To what extent are the Greek elites behind this fascist movement in Greece?

    LAPAVITSAS: Not at the moment. There is no evidence that it is the elite that's supporting the fascists at the moment, although the elite have certainly supported some of the authoritarian and nationalistic far-right parties that emerged—non-fascist ones, non-fascist ones. Secondly, the elite have supported this type of right-wing resurgence, but not the fascists. No evidence at the moment that the Greek ruling class, ruling elite wants a fascist solution. No evidence for that.

    So the issue for the left, it seems to me, is to put together a program that is coherent, that it can persuade the Greek people that it can take them out of the crisis and you can reset the economy. If they do that, I believe that the influence of the fascist right will diminish.

    JAY: Okay. We'll come back to you in a week or two, and we'll catch up and see how things go, because right now Greek politics are not clear at all. Thanks for joining us, Costas.

    LAPAVITSAS: Thank you very much.

    JAY: And thank you for joining us on The Real News Network.


    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


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