University of Athens’ Creston Davis argues that the Syriza party platform looks more like the Democratic Party in the ’60s rather than a leftist party
PAUL JAY, SENIOR EDITOR, TRNN: Welcome to the Real News Network. I’m Paul Jay. In the wee hours of Monday morning Greece’s Prime Minister Tsipras struck a deal with the leaders of the Eurozone. Amongst the things that was agreed to, the Greek parliament must immediately adopt laws to reform key parts of its economy. Of course, they use the word reform. By Wednesday the reforms must be approved by the Greek parliament. These reforms include streamlining the pension system, boosting tax revenue, especially from VAT. That means the consumer tax, not income tax or corporate tax. Liberalizing the labor market, we’ll get into a minute what all that means, and privatizing the electricity network. Extending shop opening hours, we’ll explain why that seems to matter. The eurozone agrees in principle to start negotiations on a loan package for Greece worth about $82-86 billion. That’s maybe somewhere in the range of $91-96 billion US. The loan will come mainly from the European Stability Mechanism, ESM, the Eurozone bailout fund. But the International Monetary Fund will also be asked to make a contribution from March 2016. That’s something that Mr. Tsipras had said he didn’t want to agree to. I guess there’s a whole list of things he said he didn’t want to agree to, and wound up having to agree to. One of the most controversial things that had been proposed, according to all the rumors coming out of the negotiations, was a dealbreaker, in fact is in the deal. A new trust fund will be set up, managed by Greece. That’s a difference. Originally this trust fund I think was supposed to be managed by Europe. In fact, managed in the end by a company that was controlled by the German finance minister. Now it seems according to the language we’re hearing, Greece will manage this fund. It’s $50 billion of Greek national assets. That means things that’s public property. This property is either going to be privatized in some way, or they’re saying this fund will manage these resources in order to create income. Half the fund will be used to fund the debt, the other half is supposed to go towards investment. But this fund which was originally, as I say, supposed to be managed by Europe, perhaps this is a significant compromise or maybe a small victory by Tsipras that it looks like it will be Greece and not Germany that manages this. At any rate, to help us unpack all of this and joining us from Athens is Creston Davis. Creston is the founding director of the Global Center for Advanced Studies. And he’s co-author with Slavoj Zizek of Paul’s New Moment. That’s Saint Paul, not this one. Thanks very much for joining us. CRESTON DAVIS, GLOBAL CENTER FOR ADVANCED STUDIES: Hey Paul, how are you doing. JAY: Very well. Let’s start unpacking. Well, first give me your overall impression of the deal and how it’s going to be received in Athens, and then maybe we can dig into some of the difference. DAVIS: Sure. The overall impression is defeat, honestly. Straightforward defeat. Syriza looks ridiculous. They’re contradictory, given how they brand their campaign. And ultimately they folded a week after the oxhi celebratory referendum that really brought together the populace of the Greek people. So in light of this kind of bipolar, schizophrenic moment of the high of the oxhi to a very, a very demoralized atmosphere here in Athens. JAY: So that’s the no vote, oxhi, where the Greek people were asked to vote yes or no on a proposal that Europe had given, and something like 61 percent of Greeks said no. And it seems to me that proposal was not even as onerous as this one. Is that true? DAVIS: That’s right. The first–the referendum that the no vote won a week ago was far less in terms of austerity measures and far less sinister than what was just agreed upon a week later by Tsipras and the Greek government. JAY: Now, what else could he do in this particular moment? It seems to me you can go back to errors that were made from the beginning. But you said something to me off-camera maybe we should talk about first before we get into this, which is just the kind of party Syriza is. Because I think a lot of people outside think of Syriza as a very left-wing party. And you’re saying it’s actually far more complicated than that. DAVIS: Yeah. I mean, to put it in American terms–and I grew up right near Baltimore, where you are. But to put it in American terms basically the platform of Syriza looks very similar, very similar, 90 percent the same as the basic JFK platform in America in the 1960s. The difference is that we live in a new era, an era that began in the 1970s called neoliberalism. And that neoliberalism really came to fruition, started in Chile in the ’70s under military regime actually backed by professors like Milton Friedman from the University of Chicago. And they installed neoliberal policies in the dictatorship of Pinochet in the ’70s. And then you have Ronald Reagan and Margaret Thatcher adopt these same basic premises of the neoliberal outlook that, it must be understood in contrast to a Keynesian outlook where you have a much more democratic way in which you can regulate exchange and commerce and markets. So what you have here is you have Syriza looks very much like a Democratic party in the ’60s in the United States that in today’s terms, in hyper-neoliberalized capitalist terms, looks radical. But in fact it’s not radical at all. It simply calls for basic social services and a democratic process by which to regulate economic [inaud.] JAY: So the leadership of Syriza was never prepared for or wanted a more radical solution, which a lot of people argue was the only alternative to what’s transpired. But let’s dig into the deal a little bit and then we’ll go big picture again. So is this deal any better than what would have been signed at the very beginning of this whole process? DAVIS: This feels much worse, actually, than anything that’s been put on the table since Syriza came to power. And that’s the humiliating part. Paul Krugman in the New York Times just wrote about how humiliating this deal is to the Greek people and also to Syriza. Basically what you have here is the Troika, the European Union, really putting Syriza under their boot, and making a statement kind of like Truman making a statement when he bombed Hiroshima, let’s say, to the Russians if one wants to follow that thesis. It’s a statement. What we have here is an example of how other countries in the EU who might, like Spain let’s say, or Portugal, or Italy, Ireland, who might want to think about activating and energizing the populace, you better not do that. That’s the signal here. JAY: Okay. Let’s dig into some of the specifics. So first of all, when they talk about streamlining the economy they talk about first of all boosting tax revenue, but mostly through the VAT which is the added value tax when you go and buy stuff. Not income tax. How does that compare with what Syriza wanted, and how significant is it? DAVIS: Syriza wanted, basically, to re-establish and to come out of these austerity measures to try to produce a hope in society where you have 28 percent unemployment. And to try to get some kind of energetic, energy into the economy. So specifically, Syriza was looking at keeping the pension where it is, providing resources for employment for young people, and also providing a, similar to the New Deal in the ’30s, where you provide resources, employment resources, for the populace that has been unemployed. So clearly on every level Syriza’s at least agenda politically has failed. JAY: Liberalizing the labor market, what exactly is that going to mean? DAVIS: Yeah. Liberalizing the labor market is code for let’s have the rich own everything. And because you’re in debt, the Greek people are in debt–which by the way, it should be mentioned the Greek people are in debt not because of the Greek people. This must be clear. The Greek people are in debt because the neoliberal puppets that were installed in the Eurozone when Greece entered the Eurozone in 2001. And if you look at the books and you look at the books and you look carefully at the books, they were cooked and hidden about exactly what the debt was. And this has compounded the problem, and ultimately the IMF is making $2.5 billion off the deal. So when you talk about liberalizing the markets you’re talking about the big Wal-Mart style of coming in, closing down shops, local shops. Basically closing down the culture and commerce of the Greek people and imposing a top-down model, a Wal-Mart model, let’s call it, onto Greece so that they look much more like a streamlined economy where the 1 percent are benefiting and the rest of us just have to [inaud.] JAY: But what are some of the specific labor laws that are going to have to be changed, then? DAVIS: I mean, the–first of all, the pensions, you were talking about. Okay, so they’re closing–they’re actually going to require shops that normally close in the afternoons so families can eat together, so there’s a more family–they’re requiring those shops to stay open longer. And this is actually part of the deal. So in other words what you’re having here is a dictatorship about how Greek people interact with with each other on a daily, local, neighborhood kind of level. JAY: Some of those things that they’re going to have to do I understand is they had re-hired a lot of cleaners and re-hired teachers who had been laid off. So is this, are they going to have to undo some of the things they did to mitigate the effects of the austerity? DAVIS: Absolutely. These folks that were just rehired who were just fired for no reason, they had the funds available. And the previous government before Syriza rose to power fired masses of teachers, massive levels of workers. And overnight. And they didn’t have to do that. And so they fired them, and in Syriza they rehired and restructured because it was fair to the people. But now those folks, their jobs now are at stake again. JAY: Now, one of the most controversial things I mentioned in the introduction was the 50 billion Euro fund that was supposed to be established. During the night there was a lot of back and forth. One of the things that had come out on Twitter and in the press, that the German organization that was supposed to manage this, in fact, wound up being owned by a banking firm that had the German finance–Schauble’s–. But that looks like now that isn’t what’s happening. Language we’re seeing is, Greece is managing that. Does that make it really less onerous? Or the fact that it really seems to be about privatization, is that going to be as controversial as it seemed? DAVIS: That’s a good question, Paul. I mean, I think you would want to–if you want to look at this, the devil’s in the details, obviously. You’d like to look at the firm, the Greek firm that actually is going to mitigate and manage this $50 billion of privatization and was focusing on the energy grid. And you have to, you actually have to look at who is in charge there. My guess is, and it’s probably no surprise, those folks, the Greek folks who are in charge, are very good friends with the Eurogroup. JAY: How do you think all this is going to be received? They’re supposed to get an approval by the Greek parliament by Wednesday. I spoke to someone who’s pretty close to the Greek parliament, and he says he thinks it’s going to be bedlam in parliament. What’s the reaction going to be like? I guess you’ve been out talking to people in the streets. DAVIS: Yeah. Okay, so the opinion of people on the streets actually is interesting. But with respect to your question, within hours–within 24 hours, the left platform of Syriza which makes up about 25 percent of Syriza–and that’s the radical left side of Syriza’s overall party. But it makes up–it’s a minor, it makes up one-quarter of the overall party, they’re actually going to resign. Or at least, they’re expected to. JAY: Resign from Syriza? Or resign, if they’re members of parliament. DAVIS: Resign from Syriza as MPs. What they might do–okay, so they could reformulate a party. That’s unlikely. But yes, you’re going to see resignations. In fact, there’s resignations–or rumors were rumbling all the way up till Saturday. But with respect to the populace, the people here that I’ve spoken to, shop owners, the printing shop owner, several other people on the train, the feeling here is thank God. Why? Because they have the funds coming in again. You have to keep in mind that people here in Greece, I’ve been here for several months, people here in Greece are being terrorized by how the banks would just shut down. So if you think you can’t go to the bank and get your money, that’s actually a tactic that’s been used to pressure the Greek government, Syriza in particular, to fold to these measures. But in general now the banks will remain capitalized. You can only get 50 Euros, 60 Euros a day out per account until this deal is met. So there’s going to be pressure, do you see how now the Eurogroup has put pressure onto the parliament. You better pass this so people can actually access their funds. It’s a kind of blackmailing tactic that’s been used. But in general, the spirit in the air for locals is thank goodness, I hope to get access to my money back. That’s different than the younger generation, the younger folks I’ve spoken to, who are like, still in the spirit of the oxhi, the no vote, the energized populace. And they want a Grexit. You know, they want a plan B. But let’s say about 30 percent of all Greeks want a plan B. Most people want to stay in the EU. It’s debated, 50 percent, some polls go all the way up to 70 percent want to stay in the EU. So what you have here is a volatile mix of a lot of opinions coming from different directions, and Syriza is in the mix. And whether they get it through parliament, back to your question, Paul, I don’t know. I think it’s going to be a very, very difficult challenge, and if you have the left platform of Syriza’s party resigning it’s going to be even more challenging. JAY: All right. Thanks very much for joining us, Creston. DAVIS: Okay, Paul. Thank you. JAY: And thank you for joining us on the Real News Network.
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