Choosing a different path

March 10, 2015

Last month, the new Greek government led by the Coalition of the Radical Left, or SYRIZA, agreed to an extension of the financial bailout organized by the so-called Troika (the European Union (EU), European Central Bank (ECB) and International Monetary Fund (IMF) on the condition that previous Greek governments accept the drastic austerity measures contained in a series of Memorandums. Prime Minister Alexis Tsipras and Finance Minister Yanis Varoufakis retreated wholesale on SYRIZA's commitment to reverse austerity and to demand cancellation of the greater part of Greece's massive foreign debt.

But the problems for the new government are only beginning. In an editorial in the March 4 issue of its newspaper Workers Left, the socialist group Internationalist Workers Left--a cofounder of SYRIZA 10 years ago and now a leading voice in the party's Left Platform that is critical of the Eurogroup agreement--calls on members of SYRIZA to mobilize around an alternative of resistance to the lenders and struggle against austerity.

ONLY A few days elapsed after the government's agreement in February with the "institutions" (the EU, ECB and IMF, formerly known as the "Troika"), and the government was confronted with the first difficulties posed by applying the deal.

Beginning with the repayment of an IMF loan of about 1.4 billion euros that is due in March, the government must come up with some 7 billion euros to cover its commitments through March. This will require wiping out everything available in public funds, while leaving shortfalls in critical funding needs like public hospitals and pensions.

In order to come up with the funds, the government will be under pressure to follow the well-worn tracks of the Memorandum governments: a possible increase in the Value-Added Tax rate, resulting in an increase in taxes on consumption goods that will hit workers disproportionately, or even some kind of special tax assessment--a possibility left open by Yanis Varoufakis and the idea of "frugality" that he outlined in the prologue to a book on austerity by Mark Blyth.

Prime Minister Alexis Tsipras
Prime Minister Alexis Tsipras (Filippo Riniolo)

If SYRIZA sticks to this path, the political consequences will be immediate--a crack in its relationship with the social base that propelled it to victory in the January 25 elections, and the betrayal of the hopes and expectations placed in SYRIZA internationally, which will undermine critical mobilizations of solidarity with Greece around Europe.

In this situation, the parties that lost the January elections will have opportunities to go on the offensive against SYRIZA. Scenarios for a government of "national unity" have already been put forward by Stavros Theodorakis, leader of the center-left To Potami party, who has declared that he is will to cooperate with such a government...but not with SYRIZA.

THE OTHER path that the government can take is to move ahead boldly to the measures that were foreshadowed by its first laws introduced in parliament to ease the humanitarian crisis by providing free electricity and food subsidies to the poorest households and barring imprisonment for debts of 50,000 euros or less. This would mean speeding up efforts to honor the commitments that Prime Minister Alexis Tsipras made at Thessaloniki International Trade Fair [when he announced a program of measures that he said would be the first steps of a new government of the left].

The government's intentions on this critical question will be clear from how it handles the promise to restore the minimum wage to where it was before the Memorandums. Restoring 751 euros a month as the minimum wage for an eight-hour workday cannot be put off to the future--the second half of 2016 or the first half of 2017, as some have suggested.

By proceeding immediately to honor the commitments from Thessaloniki--without negotiations with the lender, as the prime minister said at the time--the government can rally support from a broad majority of the working class and popular masses. Based on this support, it can systematically pursue ways to disobey the agreement imposed by the lenders threatening the government with bankruptcy. In each case, SYRIZA should either seek to undermine the agreement in practice or be ready in June to remove the straitjacket imposed by the compromise with the lenders.

The alternative scenario would be the death of the project of a government of the left. Honoring the obligation to service Greece's debt is only possible with draconian austerity pursued at the expense of pension payments, wages and social spending.

The opposite path of moving ahead is the only way out for the government. It is an unavoidable path for SYRIZA as a party if the leadership does not want to lose in a few months the power and position it has achieved through a decade of struggles and hopes.

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