Mark Weisbrot says Podemos and SYRIZA have risen out of long term austerity, and Greece has a good chance of recovering outside the Eurozone
SHARMINI PERIES, EXEC. PRODUCER, TRNN: Welcome to The Real News Network. I’m Sharmini Peries, coming to you from Baltimore. In the regional parliamentary elections in Spain held on Sunday, Podemos Party won fifteen seats in the region of Andalucia. The fifteen seats places Podemos in prime position of influence with the Socialist Party, who came eight seats short of the majority. Most polls are saying if national elections were held today, Podemos would win. National elections must be held before the end of the year, likely in October or November. So all eyes in Europe are on Podemos this year, as Podemos victory in Spain, combined with the Syriza party in Greece, could change the dynamics of the Eurozone. Joining me to discuss the most recent developments and the gains being made by Podemos is Mark Weisbrot. Mark Weisbrot is a co-director of the Center for Economic Policy Research in Washington. Thank you so much for joining us, Mark. MARK WEISBROT, CO-DIRECTOR, CENTER FOR ECONOMIC POLICY RESEARCH: Thanks, Sharmini, good to be with you. PERIES: So Mark, Podemos is gaining momentum all over Spain, and especially in places where unemployment is really high, almost as high as thirty-four percent. Why do you think that is happening? WEISBROT: Well, this austerity has gone on a long time, and people–there’s a great disillusionment with the two major parties. You know, they had two parties been running the country since it emerged from dictatorship. The … you have the Socialist Worker’s Party, PSOE in Spanish, and you have the–that’s the center-left party. And then you have the party that’s in power right now, the Partido Popular, the Popular Party, which is a right-wing party with its roots in the fascist dictatorship. Those parties are losing support, actually fairly rapidly. So Podemos was started in January of last year, and it already, by November it was the biggest party in the country in the polls. So this is a kind of the collapse of the center-left, really, more than anything. Because … and simiar to what you saw in Greece, where the socialist party, PASOK, got forty percent of the vote or more. And for forty years. And got six in the last election on January 25th. So this political space that was occupied by the center-left in much of Europe is collapsing, is being vacated by them, because they supported these terrible austerity policies that lead to mass, years of mass unemployment, cuts in healthcare, pensions, and other social spending, and really an attempt to remake Europe into something that is quite a bit less than a welfare state, which people had voted for for decades. PERIES: So Mark, Syriza is having some trouble in terms of dealing with its debt and having to negotiate with the Troika and Eurozone partners in terms of dealing with their debt. What kind of financial crisis is going on in Spain that Podemos might have to deal with? WEISBROT: Well, I think it would be similar. First of all, I think one of the reasons why the European authorities are putting so much pressure on Greece–and really trying to undermine the economy, you have to realize. That’s not really reported so much in the news, but if you look at what the European Central Bank and European officials are doing, they’re really trying to harm the Greek economy while they’re negotiating, so as to undermine political support for Syriza. And they don’t want Syriza to succeed. Not only because of Greece, but they don’t want it to provide any hope for Spain, as well, which has national elections later this year. And so I think you’re getting–they’re doing a delicate balance, though, because they can also force Greece out of the Eurozone, in which case you have a whole different picture. It’s possible that Greece could, I would say even likely, that Greece would recover outside the Eurozone faster than other countries, and then that question of leaving the Euro would be on the agenda in other countries. So they don’t want to blow up the Eurozone. On the other hand, they don’t want the Eurozone to have these left governments. They don’t even want the Eurozone to have the kind of social democracy that it had before the world financial crisis and recession. So that’s what’s really going on here. What you have is a situation that’s much worse than the United States. You know, we had this recession that lasted a year and a half. The great recession, this was the epicenter of it, and then we’ve been recovering ever since. Whereas Europe went back into recession for two more years, and never really came out of it, after having a recession that was similar to ours in 2009. Now, that … 2008. That’s the fundamental problem. We’re looking at this kind of slow motion democracy, where twenty governments have fallen and yet these unaccountable, unelected European authorities, the European Central Bank, the European Commission, the IMF, they’re still trying to force these unwanted so-called reforms on the weaker governments. And so what you’re getting now is the first time in Greece, you had an election where the government had a strong mandate to say no. And Podemos now has come out and said, yeah, we’re going to say no to this, too. PERIES: Mark, is the crisis, the economic crisis in Spain, as grave as it is in Greece? WEISBROT: Well in terms of unemployment it just about is, yeah. I mean, it’s twenty-four percent, or twenty-three point seven percent unemployment. That’s almost the same as Greece, twenty-five point eight. And of course youth unemployment is about double that. So yeah, that’s what really matters. Now, they haven’t had as much lost output as Greece, they haven’t laid off a fifth of their, you know, federal work force. But they made some very negative so-called reforms that have reduced access to healthcare, that have reduced unemployment compensation, that have hurt people’s living standards, and they have a government that really wants to do those reforms, too, because it’s a right-wing government. And–or at least they want to do the ones they can get away with. So yeah, I think … from, you know, again, you don’t have as much loss of output as you do in Greece, which lost a quarter of its output. It’s like the worst in our, the worst years of our great depression, in the 1930s. But you have just as bad a situation in terms of the labor market, and that, for people in Spain, is really the disaster. PERIES: Mark, you’ve had some contact with some of the leaders of Podemos. What kind of platform are they mounting in order to address some of what Spain is being confronted with, now? WEISBROT: Well, they want to reduce work hours and lower the retirement age, in order to create more job openings. I think that’s good. They want to deal with a housing market where you have, you know, evictions. People getting, hundreds of thousands of people have been evicted from their homes. They want to protect people there. Most importantly, I think, from an economic point of view, they want to stimulate the economy so they can have growth and pick up employment that way. The economy grew last year, but it was only one point four percent. Of course in the media they’re celebrating that as the fastest growing economy in the Eurozone. Well, that may be, but that’s not the kind of growth you need when you have this kind of unemployment. I think the other really important thing to realize is what a terrible future that the European officials have in store for people in Spain. They’re projecting, the IMF is projecting, that in 2019 they’re still going to have eighteen and a half percent unemployment, and they’re calling that basically full employment. So they’re calling eighteen percent or so full employment. So there’s really no future for young people in Spain, even if things go according to the plan that the European authorities have for that country. So that’s why you see this collapse of the traditional center-left party and this opening to Podemos. PERIES: Mark, thank you so much for joining us today. WEISBROT: Thank you. PERIES: And thank you for joining us on The Real News Network.
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