By Alex Callinicos
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Resistance can beat the Eurogroup rulers

This article is over 7 years, 5 months old
Issue 2443
Greek finance minister Yanis Varoufakis

Greek finance minister Yanis Varoufakis (Pic: Jörg Rüger on Wikimedia Commons)

Was Margaret Thatcher right? Is there really no alternative? This is what many people are asking after the new Greek government, led by Syriza (the Coalition of the Radical Left), backed down and signed an agreement with the Eurogroup of finance ministers in Brussels two weeks ago.

Underlying this question are two connected arguments. The narrower argument is that Syriza had no alternative given the way it was boxed in. In particular, the European Central Bank made it clear that it was willing to cut off the lifeline of money that was keeping the Greek banks afloat.

Even if this argument were correct, it was wrong of the Greek government to present the outcome as a victory. 

Yanis Varoufakis, the finance minister, boasted, “We have great success. We were alone but became the majority” in the Eurogroup.

But under the Brussels agreement, the “Institutions” will dole out money—including sums promised to Greece ages ago—in dribs and drabs as long as the Athens government continues to privatise and cut for the next four months. Then there will be new negotiations for a third bailout, with yet more of the same treatment.

Far from becoming the majority, the Greeks found themselves isolated. Other governments that have suffered austerity—Ireland, Portugal, and Spain—rallied behind Germany. Varoufakis and the Greek prime minister, Alexis Tsipras, should have been open that the programme on which they were elected—that pledged to end austerity—has suffered a setback.

Then there is a broader argument. As I pointed out nearly three years ago in the International Socialism journal, Syriza’s economic strategy suffers from “a fundamental contradiction”. Namely, it seeks an end to austerity within the Eurozone and on the basis of negotiations with the dominant forces in the European Union.


It was this strategy that was defeated a fortnight ago. The Eurogroup brutally stamped on Syriza’s efforts to address what they rightly describe as the “humanitarian crisis” caused by nearly five years of austerity.

But there is an alternative. It would involve being prepared to withdraw from the euro, impose capital controls and nationalise the banks. This was the programme of Antarsya, the Front of the Anticapitalist Left, in the Greek elections, and is supported by the left within Syriza. Syriza MP Costas Lapavitsas has spelled out the economic rationale in detail.

The obvious objection to this is the strong support for staying in the euro shown in all Greek opinion polls. But it isn’t quite a simple as this. 

Stathis Kouvelakis of the Syriza Left Platform has pointed out that Tsipras and Varoufakis failed during the election campaign to pose even the possibility that a choice might have to be made between staying in the euro and ending austerity.

This undermined Varoufakis’s negotiating position. The fact that he ruled out “Grexit”—Greece leaving the euro—in advance meant he had nothing to threaten the Eurogroup with.

The German government, by contrast, let it be known that they were willing to contemplate “Grexit”. They may have been bluffing—a forced Greek departure from the euro would have sent shockwaves through the global financial system. 

But, despite the fact that Varoufakis is an academic expert on this kind of bargaining, his negotiating position meant he was unable to call the Germans’ bluff. But the fundamental point isn’t about tactics. Nor is it about honesty as a moral virtue. It’s about the politics of social transformation.

What we have seen since the Greek elections is just how powerful and ruthless the economic and political forces ranged against Syriza are. Austerity can only be defeated through a sustained and self-organised mobilisation of the Greek masses that appeals for international solidarity.

This will only happen if the leaders of the Greek left are open about the obstacles facing them—and about their defeats as well as their victories. 

The Greek struggle has only just started, and we need to learn the lessons of its opening phase.



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