Syriza Has No Choice: Greece Must Prepare to Leave the Eurozone

When Syriza won Greece’s parliamentary elections in January of 2015, much ado was made in the international press about the rise of a new radical Left in Greece — a development that had punctured Greece’s longstanding two-party stalemate and opened up the possibility of rolling back the brutal austerity measures imposed upon it by ​“the troika,” the European Commission, the International Monetary Fund and the European Central Bank. The upstart Leftists, born of anti-austerity social movements, won by running on a platform that highlighted two central positions. First, they would end the austerity that was driving Greece deeper into a humanitarian crisis. Second, they would keep the country in the European Union.

Almost five months later, Syriza hasn’t made a radical break from the program of debt repayments and austerity. Fears of being catapulted out of the currency union have paralyzed attempts at equitable negotiations. Instead, the Greek government remains in an exhausting carousel of brief extensions and frequent meetings with creditors, as they virtually beg for more loans while simultaneously postponing any opportunity to address Greece’s pressing social issues. 

Meanwhile, the realities on the streets of Greece remain grim. Unemployment hovers at about 25 percent; cuts to healthcare have exacerbated public health concerns; and thousands of Afghan, Syrian and Eritrean refugees continue to pour in, seeking safe shores along the Mediterranean. And there are no signs of improvement on the horizon. Just this week, the OECD (Organization for Economic Cooperation and Development) forecasted worsening unemployment and a growing debt-to-GDP ratio in Greece in the coming months. 

This past Wednesday, Prime Minister Alexis Tsipras met with his country’s creditors in Brussels to discuss the terms of Greece remaining in the currency union. Taking an optimistic tone, Tsipras maintains that Syriza’s proposal to reduce the austerity burden and allow his government some breathing room to address the social costs of the ongoing crisis is the only reasonable path forward. But Jeroen Dijsselbloem, president of the Eurogroup’s finance ministers, has been less optimistic that a deal will be struck on Greece’s terms. It appears that any deal will require Syriza to capitulate further by increasing sales taxes on prescription drugs, making cuts to already dramatically-reduced pensions and running an even larger budget surplus. Any steps in this direction would constitute the continued betrayal of Syriza’s original promise: to end the austerity.

All this is important because, as of last Thursday evening, Greece has announced that it will not make the 305 million euro debt payment they were scheduled to make to the IMF this Friday. Instead, they will bundle this payment with the next and fork over 1.5 billion euros at the end of the month. This development pushes back the date of the payment and buys some time on the negotiations of ​“cash-for-reform,” whereby Syriza agrees to implement reforms aimed at producing ​“growth” by cutting into social spending in return for loans. By delaying the payment, Greece and its creditors will continue working on the differences they maintain over taxes and pensions.

Taking a characteristically defiant stance, Finance Minister Yanis Varoufakis, has implied that no more compromises can be made by Greece as the solvency issues have been ​“politically engineered by our creditors to try to squeeze us into effectively perpetuating this debt-deflationary crisis.”

But we’ve heard that kind of rhetoric from Syriza’s leaders in previous months, only to see Syriza back down from its positions.

These dire conditions have led to the continuation of anti-austerity protests and a further weakening of Greece’s economy, as savers withdraw their funds and investors remain reluctant to expand business. To be fair, Syriza inherited this situation. But the party has done little to drag its way out; in failing to be sufficiently radical and break with the eurozone, its leadership has been just short of disastrous.

While leaving the currency will most certainly be economically, politically and socially traumatic, the last five months of cyclical negotiations have proven to be ineffective in accomplishing the kind of change Syriza promised during its campaign. And the last five years have been disastrous for the people of Greece.

The first step in breaking free will require engaging the popular movements and labor contingents that made Syriza’s election possible. Public general assemblies can serve as a means of democratizing the conversation and building solidarity across the Greek landscape. While profound hardships are inevitable — perhaps even worse than what the Greek people are currently facing — one should note that they already exist. Instead of relying on media conjecture and fear mongering on the part of political opponents, Syriza should look to unleash a massive awareness campaign that aims to educate the public as to what they can expect as fallout from the break.

To combat panic and provide some domestic stability, Syriza should look to provide basic reassurances to the people by following the program outlined by Syriza Member of Parliament, Costas Lapavitsas: they should ​“forbid house foreclosures, write off domestic debt, reconnect families to the electricity network, raise the minimum wage, stop privatizations.” The measures advocated by Lapavitsas, after all, are the popular steps Syriza promised when they campaigned to win control of the government.

Without such measures, Syriza is doomed to fail, stuck in their current position of carrying out a politics that is unable to break with neoliberal capitalism. By favoring the ​“stay in the euro” platform instead of focusing on ending the social catastrophe of austerity and preparing the Greek people for the difficult steps that such an exit would entail, Syriza has favored the status quo and the financial institutions over the people.

The party’s apologists will echo Tsipras and call this approach the only realistic one. Inevitably, capitulating to the demands of Greece’s creditors will be framed as ​“an honorable compromise.” But if Syriza continues along this path, the unavoidable deepening of an inherited crisis will be blamed on the Left.

Still, within Syriza’s ranks alternatives to the farcical cycle of negotiations and capitulations exist. Stathis Kouvelakis, a member of the party’s Central Committee and professor of Political Theory at King’s College in London, argues that Syriza should nationalize the banks, investigate and prosecute the ​“scandal-immersed oligarchy,” implement a sizeable tax on major corporations, and reinstate protective labor legislation and unionization rights. These measures, even in the context of a Greek exit from the eurozone, do not spell disaster — they may signify the only chance at relief for a populace that will otherwise continue to be sapped dry by domestic oligarchs and vampiric financial institutions.

By taking such measures, Kouvelakis argues, Syriza can begin addressing the human cost of the last five years of harsh austerity. Consequently, such an act of defiance may also breathe fresh life into the hopes for electoral politics’ capacity for change.

When Syriza first won the elections, they did so on the ballots of a powerless citizenry — disenfranchised by the decisions of European technocrats and desperate for an alternative. By championing timid action in a time of mortal crisis, Syriza sides with the powerful. The prospect of leading Greece out of the eurozone is an unquestionably terrifying one. But if Syriza is to roll back the austerity that has so devastated the country in recent years, such an exit is the only realistic possibility.