The good, the bad and the ugly and the outcome of the Greek elections (the rest)

(…) Now that a new more stable government is formed and the fact that SYRIZA is a potential political force that can rule the country in the future make the situation different. The party will continue to be attacked for its rejection to enter the coalition and questions over its European orientation and its development strategies will remain high in the parliamentary discussions. The strategy of the party to go against the bailout and the austerity measures and at the same time to argue that it is in favour of the euro needs careful handling as it was not simply a populist pre-election trick. It reflected the dual nature of the party, which tried to conciliate its reformist and radical sides. Staying in the euro did not satisfy only the Greek voters, but also the reformist side of the party. Hard words against the dominant neoliberal actors satisfied everyone. Yet, the attack to the neoliberal donors cannot be followed by simplistic statements that were made by some MPs of the party, who argued that the lost funds could be found from alternative external sources, such as Russia and China.

Such statements are linked to the ideological history of these countries rather than reflecting on their current situation and SYRIZA needs to become more pragmatic. For example, Russian revenues rely heavily on oil and gas; the international prices of these commodities have dropped. Actually, this situation forced last year Medmedev to announce serious budget cuts in many important areas of the Russian budget, such as the defence sector. Similarly, the Chinese economy is seriously hit by the global crisis. In fact, Chinese policymakers have argued that the crisis of the Eurozone is due to the ageing European welfare state structures. Hence, indirectly, they were asking for more robust neoliberal policies. This is hardly surprising given the fact that China is undergoing its own industrial revolution. Borrowing examples from Polanyi’s work on the European transformation, someone can easily see that human and working rights were minimal during this period, as the industrial development relied on a cheap and muted labour force.

Reliance on Chinese funds does not stop on the fact that the country is not able to offer so much money to an insignificant economy like the Greek one. China has become the main aid provider to many African countries and someone should see what the implications are for these economies in order to understand in depth the Greek reliance on Chinese aid. Chinese aid to these countries is followed by deindustrialization, cheap sales of raw materials to China, building of infrastructure by Chinese firms, massive Chinese immigration to the African states and a block to the recognition of Taiwan to the African states that had recognized the country. So, if someone followed the assumptions of those that wanted to see Greece in Chinese hands could argue that the deindustrialization of the past would continue (as it does since the 1980s), the Greek resources and state companies would go to Chinese hands instead of western ones. A change of the Greek external policies towards Taiwan would be asked, bringing the country to an even more marginal position within the EU institutions.
This situation contradicts the logic that inspires SYRIZA. The main points of its programme and the statements of its members highlight the fact that Greeks should reclaim the loss of their sovereignty, not handing it to other external actors (which are not even democratic). So, the party leader needs to find a cohesive way of claiming back the lost sovereignty, not to minimize its return down to the single factor of negotiating hard at the international arena (especially with our existing lenders). This way can be found by organizing coalitions at a European level, within and outside the EU institutions. In this manner, Tsipras can utilize his position at the European fora and to go even beyond them in order to understand the demands and ideas of the emerging social movements that exist in Europe (and beyond).

In addition, the party must form clear proposals about the development of the country and not to simplistically support a Kirchner-type renationalization of the state enterprises, which is against the EU laws. The party suggested some positive measures, such as the creation of a property map and the simplification of the taxation system, which will make the system fairer than before. Yet, instead of creating some active industrial policies that could follow these measures, SYRIZA decided to place the Greek problem on the functioning of a market-obstructing institutional setting, asking for more money to implement modernization solutions that have failed to alter the socio-economic background of Greece in the past. This strategy did not persuade the Greek voters that the party was ready to deal with the chronic trade deficits. SYRIZA seemed unable to understand what the developing countries that escaped from the poverty trap did well. This situation did not allow to the party to reorient the debate domestically and internationally about the economic future of the country.

At this point, lessons from the early structural economists (such as Rosenstein-Rodan, Lewis and Prebisch) are significant as they highlight the structural problems of the Greek (in this case) economy. What these works convey is that the orthodox logic of aid to Greece is not constructive if it is applied as if the country has a saving gap, which derives from its own poverty. This orthodoxy, which has misinterpreted the structuralist logic perceives the state as an enemy of the market and aims for trade surpluses at any cost. Tight monetary policies can hold down inflation, but they do not deal with its fundamental causes. What SYRIZA simply did was to reverse this orthodoxy by simplifying the role of the state and asking for relaxed measures in order to feed domestic consumption. Yet, what we should keep in mind from the global history of development is that for late development countries trade deficits are necessary, but alongside with a strong policies that answer the questions that rise from the difficulties to develop a country in a globalized environment; from the increasingly technological gaps between the EU states; from the financial and technological demands of the EU states and the obstacles that they bring to growth. The troika has failed to find appropriate solutions to these questions and the main opposition party has been called to answer them. If it fails to do that then it means that the Greek political system in its totality cannot manage the next day of the Greek elections within or outside the Eurozone. This leaves for conclusion the fact that the ‘good guy’ might win the fight in the future, but someone should remember that the story ends in a cemetery.