Greek Voters Deliver Stunning Rebuke to Austerity
Michael Spourdalakis, Dean of the School of Economics and Politics at the University of Athens, in an interview with Dimitri Lascaris, says it is time for the Greek government to play hardball with the Troika
DIMITRI LASCARIS: This is Dimitri Lascaris for the Real News. Over the past five months Greece’s newly-elected government led by leftist party Syriza has been locked in difficult negotiations with the ECB, the EC, and the IMF, otherwise known as the Troika, in regard to the so-called bailout of Greece. The bailout has enabled Greece to service its debts for several years, but has also obliged Greece to enact austerity measures that have resulted in a severe contraction of the Greek economy, and what the government describes as a humanitarian crisis. The new Greek government has sought to secure further funding, but has been unable to obtain it from the Troika, in order to service its debts because it felt it could not agree to the further austerity measures being demanded by its creditors.
Matters came to a head last week when the Greek government felt it was presented with an ultimatum by the Troika. Rather than accept the ultimatum, the government surprised many by calling a referendum on that ultimatum. Today Greek voters said oxhi, or no, to the last offer of the Troika. Here to discuss the consequences of this vote is Michael Spourdalakis.
Michael is the dean of the School of Economics and Politics at the University of Athens, and a professor of political sociology and the director of the Laboratory of Political Communication and Media Information at the university.
MICHALIS SPOURDALAKIS: Hello from Athens.
LASCARIS: And thank you for joining us at this late hour.
Obviously this has been an extraordinarily difficult week for the Greek government, and also for the people of Greece. Now that the referendum is over, and the oxhi vote has clearly prevailed, please tell us where the vote currently stands and what the mood is in the capital this evening.
SPOURDALAKIS: Well, we have almost all the vote counted at that point, and the result is about 61.3 or around there for the no vote, and the rest is for the yes. Clearly a difference of approximately 23 points. The most optimistic prediction just as of last night for the no vote was around 10 points.
So you can imagine it was a pleasant surprise, a great victory for the forces who said no to austerity primarily. The forces who sent a strong message to Europe to stop austerity policies. And a hope for agreement, an agreement with the so-called institutions. An agreement, however, who will give a bit of space to the Greek government to maneuver and put the house in order eventually for the benefit, of course, of the lower social classes.
LASCARIS: Now, many, despite the landslide victory of the oxhi camp, a substantial percentage of the population did vote yes. And many observers during the week have expressed concern that the referendum might open, or reopen, old wounds from the historical battles between the right and the left in Greece. Including, particularly, the civil war that followed the second World War. What do you expect the reaction of the yes camp to be to this rather decisive defeat at the hands of those who are opposed to austerity?
SPOURDALAKIS: This is correct. The yes vote campaign was crafted around a whole scenario and a [network] of scare tactics. And also they tried to rise polarization to the level that we haven’t witnessed in the last many years, in fact.
However, this didn’t work out for them. Of course there was some kind of polarization. But today it was proof that that was very artificial, and this was primarily in the media but never hit the streets, or even I would add, the hearts of the Greek voters. There were no instance in the cases, as you know, as we all know, in the cases of polarization in the previous years we had some incidents that they didn’t guarantee a peaceful process around the elections.
So the elections were very smooth, very peaceful, and that proved, that brought to the fore another great defeat to the media that they, in the last few months and in particular in the last week or so, that were very aggressively campaigning for the yes vote. So I don’t think–I don’t have any fear about this function of polarization.
In addition to this, Prime Minister Tsipras tonight just called for a meeting of all parties’ leaders. Now, mind you, there the leader of the opposition is not going to be present because he resigned tonight.
LASCARIS: That would be Antonis Samaras, the leader of the right wing–.
SPOURDALAKIS: Antonis Samaras–resigned, yeah. The leader of the opposition and the previous prime minister resigned from the leadership of his party. So that risky, for many people, initiative by Tsipras to call for a referendum had many repercussions inside Greece and outside.
Send a message to Europe, say yes, we want–Greece would like to be part of the European process. But part of the European process, that first of all is democratic. Secondly is, that process and this development and dynamic should be based on real dialog, solidarity, and democracy. That’s something that we haven’t seen in the past many, many years, where primarily Germany assisted with France, occasionally in fact they dictate what is happening, what is going to happen in the union, bypassing in the most arrogant way you can imagine the will of the nations. So the governments that they might have minor differences with, with that kind of leadership.
The question in Europe–let me say two more phrases. The question of the referendum and the question of the relationship between Greece and Europe is not just the economic problem. The rescue, if you like, quote-unquote, plan for Greece, it has to do with the issue of democracy.
Greece has been, and we all know that, the only democratic response after the crisis in Europe. And this hasn’t been appreciated by the EU’s leadership at all. It’s been disregarded. It seems to me that European leadership can much more tolerate the right-wing populismo, or even neo-nazis, so radical right expressions or responses to austerity more than the democratic response to austerity. Even this might happen to be Syriza, in other words, a radical left party.
LASCARIS: Now, in the week following the announcement of the referendum, Christine Lagarde and other officials from the Troika said that the last offer put to Greece by the creditors would expire at midnight on June 30 when the current so-called bailout expired. And after that, Greece’s Prime Minister Alexis Tsipras made an offer to Greece’s creditors which many considered a substantial acceptance of the Troika’s last offer with some modifications.
Those of us who negotiate for a living usually withdraw offers that we have made once our negotiating position has strengthened substantially. And the first question I have is, do you think that that offer, the one made by Prime Minister Tsipras, is now off the table? And secondly, just minutes after it became clear that the oxhi camp was going to win the renowned economist Steve Keen, who has been quite sympathetic in his public statements about the crisis to the current government, published an op-ed in Forbes magazine in which he said it was time for Yanis Varoufakis to play hardball, because his hand had been greatly strengthened in the negotiations.
And so in addition to my question about whether you think that offer will be withdrawn, what do you think the essential elements of this new deal have to be in order to satisfy those 60 percent or more of the Greek electorate who voted oxhi today?
SPOURDALAKIS: Okay. 61-plus percent is a, it’s a wonderful support for the government and it’s a very clear and loud voice, an anti-austerity voice, coming from the little corner of Europe, Greece, towards Europe and towards the world. However, at the same time it’s very difficult in some ways for the government to negotiate.
In other words, the government cannot ignore this strong voice. Cannot ignore the will of the people which is very clear they’re not willing to make compromises. And I don’t know what the beginning of the agreement or the plan, the proposal of the agreement would be. And if in this plan would be the latest proposal that Tsipras made.
However, I can suspect judging by many statements made by many officials and Tsipras himself, they are willing to compromise even the moderate Keynesian program of the, the so-called program of [Salonika] from last September, if there four–under four conditions. Pre-conditions.
One, labor relations. Labor relations should be re-instated to where they were in before 2010. Number two, no cuts in wages and pensions. Number three is on the table should be an agreement about the restructuring of the debt. And number four, a generous support for development. Everything else can be renegotiated.
Now, if one looks at the proposal put forward, some of the proposals [that] the responses of the Greek government to the proposals of the institutions, one might see that the spirit of these counterproposals are more or less the same–and you’re right in that regard–with the previous plans of the institutions. In other words, we collect money, we go through some kind of austerity measures in various areas, and so we can borrow money and pay our debtors.
The last, however, proposal–the last few proposals, however, they wanted to follow that path but have somehow a class bias. In other words they wanted to get money from overtaxing the rich and the upper-middle class and much less the lower, the lower social strata. In fact, it has been estimated that say two-thirds of the government’s revenue should come from the upper–the upper-middle classes, and one-third the lower classes. However, it seems to me that the IMF does not want this quote-unquote class bias. They want horizontal cuts, et cetera. So that was one major friction.
Now, with 62, or almost 62 percent of the no vote, probably the government will be able to push for such, for a proposal along this line, including of course the four requirements I already referred to.
LASCARIS: Okay. One more question before I let you go, because I know you’re tired. It’s late at night in Athens and I appreciate you taking [inaud.]
After the referendum was announced, successive leaders of the Eurozone came forward, almost a procession of them, and stated publicly that an oxhi vote would be equivalent for a vote for GREXIT. In addition–and you talked about how the polls leading up to this referendum, none of them came close to accurately predicting the size of, the margin of victory for the oxhi camp. And there are people who have said that the polls in Greece that have shown a desire to remain within the Eurozone can’t be relied upon because they’re generally commissioned by the media, which is dominated by the oligarchy.
SPOURDALAKIS: One company, in fact, was very close to–one [new] company who is supposed to be very independent and doesn’t play with data. But everybody else is–almost everybody else.
LASCARIS: Right. And those who’ve, who’ve cast doubt on the polls showing a desire of a majority of the population to remain within the Euro point for example to some few polls that have been done by external polling organizations like a Gallup poll in December 2014 which showed that a slight majority of Greeks wanted to return to the drachma.
In light of what the performance of, the relatively poor performance of the polls in the run up to this referendum, and in light of the fact Greek voters were told quite unequivocally by the leaders of Europe that an oxhi vote would be a vote for GREXIT, couldn’t one interpret the result tonight as being a mandate for the government to take Greece out of the Eurozone?
SPOURDALAKIS: No. Because that wasn’t the essence of the campaign, although that was claimed by the yes campaign. The yes campaign was not around the actual question. The yes campaign was, tried to change the discussion or the dilemma of the referendum between Euro-drachma, kind of thing. So that’s not the case.
But I have to say that to get out of the Eurozone, that’s not an easy affair. That’s not very, very, very easy. The European law should be violated more than once to be able to have a result like that. European Union forms an economic and monetary union with a sole legal currency in Europe, quote-unquote. This is in the founding document of the Union. Every country member of the Union should become member of the Eurozone. Every country who is not in the Eurozone is in a temporary deviation. I don’t know if I translated that point, the term properly, from the rules of the Union. And every two years, Eurozone people go and check the economic and fiscal preconditions of every country who is not in the Eurozone to make sure that they are preparing to enter the Eurozone.
Entering the Eurozone, you cannot exit. You can–because it violates the letter and the spirit of the whole union. There are various articles of many agreements, of the Lisbon agreement, of the founding document of the European Union, that do not allow that. And if the country who is a member of the Eurozone, such as Greece, who happens to fall into this, into deviation kind of a status, needs to be assisted, cannot be kicked out. Even if Greece asked to be kicked out, asked to resign from the Eurozone, this cannot be done. So it has to be a very political decision.
In other words what I’m saying, it’s very, it’s impossible as the European law stands right now to kick out any country, not just Greece from the Eurozone. And it’s extremely difficult to kick a country outside the European Union as a member state. The latter is allowed under many complex and very many difficult processes.
So all along, this discussion about GREXIT, it’s a bit too much. And too much economically determined. On the other hand, I understand very well that my approach here is very legalistic, and we don’t know that either one, either the economic or fiscal approach, or the legal approach, cannot beat politics. So it’s a political decision which can bypass both economic restraint and legal requirements for Greece’s membership to EU and to the Eurozone.
LASCARIS: Thank you very much, Michael. I hope we’ll be able to interview you again as this important and fascinating story unfolds, and thank you for joining us this evening.
SPOURDALAKIS: You are most welcome. We always wait for your solidarity, because there are a lot more interesting things for democracy and developing, and also many hopes have arise for another kind of social arrangement. More just.
LASCARIS: Thank you, Michael. And this is Dimitri Lascaris for the Real News.
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