A Soft Coup in Greece (2/2)

Nantina Vgontzas and Paul Jay have an extended discussion about the Greek Eurozone deal and the reaction of the Greek left

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Story Transcript

PAUL JAY, SENIOR EDITOR, TRNN: Welcome to the Real News Network. I’m Paul Jay.

The deal that’s been struck between the Greek prime minister Tsipras and the czars or leaders of the Eurozone has caused shock in Greece, disappointment in some people. Relief. They’re now going to get some more Euros out of their banking machines. The Greek left, some are saying, well, that’s what we expected. Others are in mourning, as one person told me.

We’re going to now go to Athens and talk to a young activist who lives in New York most of the time, but she’s been in Greece for a while and she’s of Greek descent. Now joining us from Athens is Nantina Vgontzas. She’s a sociology PhD student at New York University focusing on political economy and social movements. She’s a member of the UAW Graduate Student Organizing Committee and involved in AKNY Greece Solidarity Movement in New York.

Thanks very much for joining us, Nantina.

NANTINA VGONTZAS, GRADUATE STUDENT, NYU: Thanks for having me.

JAY: Now, just to sort of orient people, you’re an activist and your activism, one could say, is to the left of most of Syriza. Would that be correct?

VGONTZAS: That would be correct. I’ve had a lot of my political education from activists in ANTARSYA, which is the anti-capitalist front, the left of Syriza. But that also shares in terms of political strategy quite a bit with the left platform. The difference is that they’ve remained independent of Syriza. And for quite some time they faced criticism, actually, from activists in the global left for doing that. But we might see actually that there’s some merit to keeping independence, especially at this point when the government has capitulated to the demands of the Eurozone.

JAY: Right. And the left front being the left front that’s within Syriza.

So talk about the deal. What are the main points, and what do you think of it?

VGONTZAS: Yeah. So where to begin. I think one of the biggest concessions is this kind of blasé-phrased ambitious primary surplus targets with the addition of quasi-automatic spending cuts. So what this means is that theoretically if the Greek government doesn’t meet the primary surplus target of 2 percent in 2016 or all the way to 3.5 percent in 2018, there are going to get be instituted mechanisms for cutting further down on spending. And even the economics editor, I believe of Reuters–or I’m sorry, I think it was the Guardian, said this is just continuing a recessionary strategy.

JAY: Just to make sure everybody got what you just said. So if they don’t run a budgetary surplus of what, the number was what, 2 percent to begin and then 3.5, you said?

VGONTZAS: 1 percent in 2015, and then 2 and 3 in 2016 and ’17, and then 3.5 percent in 2018.

JAY: And if they don’t run that surplus than these automatic cuts will kick in, which you’re saying is a recipe for more recession.

VGONTZAS: Exactly.

JAY: One of the most controversial things that came up in the course of the negotiations was this $50 billion fund that would take Greek public assets and convert them into either privatization, or they say run some of them for the purpose of making money. But the money either way, and it seems mostly about privatization, would be 50 percent used to pay down the debt, 50 percent for reinvestment. I don’t know–it’s not entirely clear who’s running that, but it seems it can’t be the Greek government or it wouldn’t be any point of having some new structure, because the Greek government already controls those assets.

What do you make of that, and did you expect that to be a dealbreaker?

VGONTZAS: Yeah, so the details of that are still very murky. This came out of nowhere for many of us. It wasn’t included in the Juncker proposal that was rejected in the referendum. It came this week. And initially the demand from the Eurozone was that these 50 billion Euros worth of assets would be managed and sold off, basically, in Luxembourg in this mechanism called the Institution for Growth, which was actually set up several years ago under the New Democracy government with also the assistance of the German Finance Minister Wolfgang Schauble, through a German bank on whose board he sits on.

But you know, it does seem based on reports that came out–there was this one Financial Times piece that said by 6:00 AM it seemed that basically the German and Greek sides had reached an impasse. And had it not been for certain mediators this might have been a dealbreaker. And so at that point, these sleep-deprived leaders went through ten iterations of what this fund would actually look like. And for now it seems that it’s as you described. But again, you know, we won’t know what the final part is.

But it really, to be added so late in the game, I interpreted it–to be honest, of course, you know, there are material, very real material consequences to it. I think it’s going to ensure fully the privatization of the Port of [Piraeus], but more symbolically it’s adding humiliation to the defeat.

JAY: Because you have essentially some form of loss of sovereignty over how these Greek public assets are going to be disposed of.

VGONTZAS: Right, exactly.

JAY: The reaction, first of all, of people in your circles describe, and what do you think, generally, public opinion?

VGONTZAS: Lots of disappointment, frustration, confusion over why the referendum was held if at the end of the day the government was going to concede.

Now, I think–my interpretation of the past five months is that people were voting for an anti-austerity platform with of course the implicit concession that maybe they wouldn’t be able to get everything that Syriza was calling for. Especially with its Thessaloniki program, addressing the humanitarian crisis of five years of austerity. We would hear things like, okay, if they can get 5 of the 15 things that they’re aiming for, we understand that this is a tough battle. And so as the negotiations were going on, as the Eurozone was applying further pressure through liquidity asphyxiation, people thought that it was headed in that way. And I got here in late May.

And you know, when you would ask people on the ground, a lot of the people who I talked to–and you know, a lot of this is mostly in working-class neighborhoods. That’s where I do my fieldwork, near the Port of Piraeus. They didn’t want the government to go back. And I’d also been at events where Syriza leadership was speaking and they were being told, don’t go back on your promises. And then the officials would ask, well, what do you want us to do? And people would say, we want some form of confrontation, or even rupture, some people would say. And the government would say specifically, how do you see that? And some people, they would say, as much as it takes.

I don’t know what concretely people were thinking when they were saying that. If they meant default, if it meant exit from the Eurozone. But there was a sense that people were still wanting the government to stay firm–implicitly, again, there was some understanding that maybe they would make some concessions.

The referendum, though, changed that. The referendum, when Tsipras was presented with this take it or leave it agreement and he left and he took it to the Greek people, there was an understanding that he was going to continue fighting. But based on reports even from the former finance minister Varoufakis, where he says he entered the prime minister’s office after the resounding 62 percent no victory elated, and instead came to a very sombre atmosphere which meant that the government didn’t want to go toward a more confrontational or ruptural scenario. That in fact they were going to capitulate. This isn’t, I think, something that people were expecting when–.

JAY: What do you make of the reports that they were actually hoping for the yes vote to accept the proposals from the Eurozone? They were actually, the government was actually hoping that side would win, it would make their life easier.

VGONTZAS: I don’t know. There’s a lot of speculation as to what exactly they wanted. I think that because the government was so persistent in a strategy that was exhausting itself very early on, and wasn’t willing to consider a plan B, which would include anything from internal default within the Eurozone to exiting the monetary union, they kept hoping that they would be able to create some kind of disagreement within the ruling bloc of the Eurozone, specifically between the French and German ministers.

And it could be that they thought that with this no victory it was a tactic of desperation, of last resort. Maybe they would be able to get something. That’s a very, of course, optimistic assessment. It could also be that they were looking for a no that wasn’t as strong. Maybe 50-55 percent, that again they could take to the partners and say, look, are you going to look at democracy in the face and not give us anything?

It’s hard to know what they actually wanted. But we do know that that night and throughout that week they were really willing to give up, essentially.

JAY: It seems a kind of naivete in a sense, that they thought that because the Greek people expressed their will that Eurozone leaders would care. And they certainly had made themselves clear that they didn’t care. And Syriza was already elected, which reflected the will of the Greek people. So one wonders if they really thought so why the referendum would make any difference in the opinion of the Eurozone later.

VGONTZAS: Yeah. I mean, Varoufakis in the scenario that I gave, very revealing. In the New Statesman he said, I think it was taken before the agreement was actually made earlier today, he said that at one point I asked my partners, why even hold elections in indebted countries? And they didn’t even really give him an answer, which he interpreted as, you know, good question.

JAY: You hold elections because you’re sure you can control the outcome. When you have an election you haven’t controlled the outcome of, I guess this is the answer to it.

VGONTZAS: Yeah. And you could say that when Syriza was elected in January 2015 there was a sense in at least the domestic ruling class that they could control the consequences of that outcome. I don’t know if you remember, but there were some interviews made by very wealthy influential people in the country, including an energy oligarch, [inaud.] and Bloomberg news soon after the election results. And they asked him if he was concerned. And he said no, this government might actually bring us the stability we’re looking for. And then we’re going to have stable business conditions, better investment.

It could be that they thought that people would be placated enough that they could get maybe some version of austerity-lite and continue with business as usual.

JAY: And one of the arguments that’s being made is that this is as good as they could have done. That the Greek people weren’t ready to leave the Eurozone. That that vote, that no vote didn’t represent a vote for leaving. It just represented a vote, as you said, to keep fighting. But there was no way to win this fight. And that it’s better for this to, this austerity plan in the final analysis to be managed by people like Syriza than managed by others. That seems to be the argument that’s defending the situation. And that one’s being overly critical if you think that Tsipras should have walked from these negotiations, because there was simply nothing to walk to.

VGONTZAS: Yeah, I think that’s a very Tricky argument. And we can look at the final hours and we can agree that his options were quite constrained, and his lack of preparation made it almost inevitable that he would agree to the terms that he ended up agreeing to.

But if we look at the Greek political process in a bit of a broader sense, if we think about the conditions under which Syriza merged electorally as a fighting contender in 2012, those were times when there was a sufficient level of insurgency on the ground. There was a level of conversation in Greek society as to what the options could have been moving forward. I understand the arguments that at that point people weren’t ready, they hadn’t expressed their own will to leave the Eurozone.

But I think as a rising central political actor you can start putting these arguments, just opening the conversation. And the leadership never wanted to open that conversation even when they entered power, even as it seemed that their strategy was being exhausted.

There’s a very telling moment when in that interview with the New Statesman Varoufakis says, look, we did take into account contingency measures. And we had a secret group of five people in January who were working on a plan B, if it came to that. But the problem is that one, you have to keep this secret so it’s difficult to expand it to an actually viable operation that’s implemented by, say, 500 people in the country if it were to be actually implemented. But then, and I can understand that argument, but then he kind of waffled. And he said, and we didn’t have a mandate for that so of course we couldn’t expand to the 500 people.

And again, you know, I think that you can pursue a strategy that might be with the common sense of the people at that moment. You can say that we’re going to try as hard as we can to negotiate and to remain within the Eurozone. But we must be prepared. And the results of the February 20 deal showed that they weren’t prepared. Varoufakis’ own statements showed that they weren’t prepared.

I think the fact that they weren’t prepared was more out of their own strategic obstinance than–and you know, that could be easily justified over and over by popular will.

JAY: Well, Varoufakis has written that he was quite committed to the stabilization of European capitalism. And it seems, in the final analysis, seems pretty clear it was naiive to think they could have some rational, persuasive powers over European finance.

VGONTZAS: Right. I mean, I’m still going back to 2012 because I think that was a very critical period. I think European capital wasn’t quite sure yet how they were going to handle the crisis. They felt under threat. And it’s actually, it’s quite funny looking back in a tragic sense. The Wolfson economic prize, which is second to the Nobel economic prize, was won by a team of HSBC economists who actually drafted as they called it a practical guide for exiting the Eurozone. And they had a country like Greece, a weak member of the Eurozone, in mind when they drafted it.

But at that same time, people like Lapavitsas who are also arguing for those kinds of solutions, whereas Varoufakis was very committed to that. And again in that interview with the New Statesman, he said that when he met Varoufakis back in 2010, ’11–or I’m sorry, when he met Tsipras, Tsipras himself wasn’t quite firm on the Euro versus drachma position. So it might be that Varoufakis actually had quite of an influence on not just Tsipras’ own thinking but the political strategy of his party.

So again, I think it was a bit of a loose question at that point.

JAY: It seems to me the roots of this go back to the election campaign itself. That if Syriza had campaigned saying we are going to do everything possible to achieve a dignified, reasonable, moderate deal within the Eurozone, that we possibly can. But also say to the Greek people, but if it’s impossible, we will create the mechanism to leave.

And then if the truth is they couldn’t get elected by saying that, if people were so freaked out at the thought of leaving the Eurozone, that they wouldn’t elected Syriza, well, isn’t it better not to get elected, then?

VGONTZAS: Yeah, I agree. You know–. When they were preparing to enter power, because that’s really what that period 2012-2015 was, they were visiting many heads of state, they were visiting different types of think tanks. And their main message was, don’t worry. We’re not these crazy communists. We’re not looking to shake up the whole system. We just have a very simple and reasonable message of anti-austerity. And so they also went to the Brookings Institute, they went to bankers in London.

And I just–and over the course of that time, their initial message back in 2012, which was no sacrifices for the Euro, ended up evolving into this, we’re moderates, we want to stay in the Eurozone, adding the Varoufakis flair, we want to actually make the Eurozone better. We want to save capitalism from itself. And so it kind of spun into that narrative, which I agree, you know, it set itself up for something that wasn’t possible, given the balance of forces in Europe at this time, which are quite right-wing.

JAY: One of your research studies is about the rise and growth of the right wing in Greece. The working class to a large extent voted against the Eurozone proposal. What do you think happens next with the Syriza, you would think, a great disillusionment in what they promised. How will this affect the politics? And does it in any way strengthen the right?

VGONTZAS: Well, as we said in the beginning, there’s a great sense of disappointment and frustration today in Athens. But I don’t think the left feels fully defeated, and I think this is in large part due to dissidence within Syriza and outside it. The week is very young. The parliament still has to pass the measures, which they’re expected to do by Wednesday. And there have already been mobilizations called for then. The public sector, trade union confederation, [inaud.] called a meeting today. And through–this was a result of interventions by leftist unionists over the course of this period. And the result was the calling for a general strike on Wednesday. And it could happen even sooner if the measures are to be pushed sooner, but that’s unlikely.

So the big mobilizations are planned for Wednesday. And it’s not just a general strike by public sector workers, but it’s also being accompanied by rallies on the streets, by civil society organizations, by unions, by neighborhood assemblies, by university and school students. So we’ll see. There are always an array of social forces that are released in these kinds of moments. And we have to hope that the rest of the left is going to be able to preserve the standing of the left with the Greek people.

Because one thing that we should note during the week of what we call the oxhi revolt, the no referendum week, was that there was this sense that the left was starting to gain a certain kind of hegemony within the popular classes in Greece. And this was especially epitomized by the Friday night rally at [inaud.] when Tsipras was due to speak.

And of course that week, again, was a bit suspect for some of us who are watching events unfold, because at the start of the week we saw that the leadership was starting to end proposals again to the Eurozone, and we were wondering why call a referendum if you’re starting to send proposals again? And this, what we hear, is due to some internal battles within the leadership. Anyway, those were resolved by Wednesday.

And by Friday, Syriza was committed to getting a no result. And at the same time, it hadn’t done a lot of preparation to get people out on the street. And I got there by metro, and I had to wait for three different metro cars to come, because there were so many people pouring into it going to [inaud.]. And once I got out, I could hear echoes of people chanting oxhi, oxhi.

And once you got into the square there were people, there were people, say, over 100,000, maybe up to 200,000 people there. And it was a very different kind of demonstration of the kind that I’ve been to in Greece which are usually against the government, or against some other kind of government. This was a rally, a political rally in favor of the government. And people were really cheering on Tsipras. Not only Tsipras, other parts of the Syriza leadership. Zoi Konstantopoulou, the president of parliament. And just based on the people who I talked to there, and they all came from mainly popular neighborhoods. And I asked them if they were organized, and most people said they weren’t. They just support the government in this difficult moment.

So you could see at that point the left was starting to achieve the trust of people. And the worry is that it’s going to lose it very quickly. Again, I think that there are parts of the left that can show that they are willing to fight against this new memorandum, because that’s what it is, who are willing to continue to fight, to continue fighting against austerity. And we have to hope that people are willing to take note of those efforts.

But again, of course, there is the spectre of the far right. And the far right, of course, plays a, it’s an anti-systemic force. It’s a populist force. But at the same time it’s supported by quite a few interests, ranging from small to large capital. And you might think that at this point, various parts of the right, from the center to the far right are going to try to take advantage of the situation.

It’s very fluid at this point. It’s difficult to tell.

JAY: All right, thanks very much for joining us, Nantina.

VGONTZAS: Thanks for having me.

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

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