Europe braces itself for a revolutionary Leftist backlash after Greece
These were the words of European council president Donald Tusk, 48 hours after Greece’s paymasters imposed the most punishing bail-out measures ever forced on a debtor nation in the eurozone’s 15-year history.
A former Polish prime minister and a politician not prone to hyperbole, Tusk’s comments revealed Brussels’ fears of a bubbling rebellion across the continent. “When impatience becomes not an individual but a social experience of feeling, this is the introduction for revolutions” said Tusk. “I am really afraid of this ideological or political contagion.” His unease reflects a widespread conviction that Europe’s elites had no choice but to make an example out of Greece.
Alexis Tsipras was forced to submit to a deal that punished his government’s insolence, so the argument goes, and destroy the fantasy that a “new eurozone” could be forged for the economies of the southern Mediterranean.
Having emerged from the talks, Tusk declared victory, dismissing the “radical leftist illusion that you can build some alternative to this traditional European vision of the economy.”
Syriza’s unprecedented rise to power in January marked a watershed in post-crisis Europe, hitherto dominated by conservative-leaning governments from Portugal to Finland.
The first radical-Left regime in Europe’s post-war history, Syriza vowed to tear up the Troika’s austerity contract, forge a Mediterranean alliance against the dominant northern creditor bloc, and transform the terms of Greece’s euro membership.
Seven months later, these dreams are in tatters. A tortuous 30-hour weekend in Brussels led to Tsipras capitulating to austerity terms more egregious than any negotiated by Greece’s previous centre-right and Socialist governments. Greek assets will now be sequestered into a private fund to pay off debts, external monitors will return to the country, and everything from the price of milk and bakery bread will be subject to Brussels’ scrutiny.
“Syriza was the big Leftist experiment and it has gone disastrously wrong in a short period of time,” says Luke March, author of Radical Left Parties in Europe and lecturer at Edinburgh University.
“The Left elsewhere are now being forced to take stock and say ‘we are not Greece’.”
But the shadow of 1968 – a year when Europe was gripped by mass discontent, student rebellions, and labour strikes – looms over Europe’s institutions.
Over the course of the next 10 months, the entire complexion of the European south could be transformed. General elections in Portugal, Spain and Ireland are poised to bring anti-austerity, Left leaning parties to power.
It is the wildfire of political contagion that spooks Europe’s federalists. Greece’s humiliation, rather than cowing the revolutionary Left, is set to embolden the southern calls for mass debt relief and cease the enforcement of the euro’s contractionary dogma.
The anxiety is most pronounced in Spain. Podemos, the country’s grassroots anti-austerity movement, is seen as the closest resemblance to another Syriza of the south. Born out of the mass street movement of Spain’s indignados (outraged) which gripped the country in 2011, Podemos has taken Spanish politics by storm. The movement has harnessed the energies of the disenfranchised who occupied city squares, to become a rebel party with 1.2 million votes and five seats in the European Parliament after only three months in existence.
Now still only 18 months old, the insurgents have become a third force in Spanish politics. In May, a Podemos-backed Left platform dismantled 40 years of Spain’s two-party parliamentary dominance. Regional elections saw the left-wing take power in Madrid, Barcelona, and eight other major cities. Much of this runaway success has been attributed to its leader, Pablo Iglesias, a charismatic 36-year-old political science professor and former television presenter.
Pony-tailed, tieless and often seen wearing a trademark red-shirt, the hirsute Iglesias is as comfortable talking about Gramscian theory as he is hit US television shows, The Wire and Game of Thrones. His appeal has drawn direct comparisons with his Greek compatriot. A photograph of the two men, arm in arm, adorns Iglesias’s Twitter profile, where he expounds his aims and ambitions to 1.2 million followers. In the aftermath of Greece’s defeat, Iglesias hailed Tsipras for showing “courage” in the face of a German ultimatum over Grexit. “We will not turn our backs on Tsipras at the hardest time. We do not like the agreement, but never a Government showed such courage in Europe” But Podemos, which translates as “We can” and takes its inspiration from Bolivarian movements of Latin America, is no Iberian Syriza. The neo-liberal critique of Syriza is replaced by a fight against domestic corruption, promoting environmentalism, and protecting the rights of expelled housing tenants. “We represent ordinary people from across the political spectrum, who’ve had enough of corrupt politicians governing in their own self-interest and who believe a new type of politics is possible”, says Sirio Canós, a Podemos representative in London. But Greece’s defeat has led to a gradual centrist shift by the movement.
Iglesias has gradually toned down his demands for a restructuring of Spain’s household and government debt after the Greeks lost a similar battle. Podemos have also rowed back on a pledge to introduce a basic “citizens’ wage” in favour or a salary rise for the poorest earners.
“Turmoil and capital controls in Greece are likely to turn undecided Spanish voters away from Podemos, since they will think the party won’t be able to keep its promises,” says Vincenzo Scarpetta of Open Europe.
Latest polling shows support for Podemos is on the wane. The anti-establishment movement was on course to win only 41 parliamentary seats in this year’s national elections, down from an estimated 89 in January. Another set of polling found national support for Podemos had dropped to 15pc.
“The bottom line of the Greek negotiations is that a different euro is not on offer. There is a clear path of fiscal discipline and structural reforms, and if you don’t agree with that you can be shown the door”, says Scarpetta. The green shoots of economic recovery have also dampened Podemos’s popularity. Spain is set to grow 3.1pc this year according to the IMF, more than double that forecast for the eurozone.
“There are signs that the tide is turning – the recovery is real,” says Angel Talavera at Oxford Economics, who notes that exporters have begun to reap the benefits from a process of internal devaluation in the cost of goods and labour. But with unemployment at 22.4pc and youth joblessness overwhelming half the young adult population, Podemos’s mantra of social justice and a “bail-out for the people” is still set to fall on receptive Spanish ears.
Podemos are in line to become the kingmakers come elections at the end of the year. “Iglesias understands that you need to get into power to change things”, says Miguel Otero of the Elcano Institute in Madrid. “He knows you need to drop the dogmatic discourse of the old Left in favour of courting allies and seeking compromise.” This practical attitude to power makes the current crop of Europe’s young leftists a departure from their intellectual forefathers in Europe’s traditional Marxist and Communist parties. “Syriza’s hardliners have just dropped out now, but in Podemos, the ideologues, including one of the intellectual inspirations, have already left complaining the party has become too institutionalised already,” says Otero.
Podemos are now ripe to form a coalition with Spain’s traditional Socialist party (PSOE), revived by their own young, telegenic leader, Pedro Sanchez. The Socialists are currently neck and neck with the incumbent conservative Partido Popular party of prime minister Mariano Rajoy.
“We know that it is very important to occupy institutional power in order to change things,” Iglesias said earlier this year. ”It is important to be in parliament, to win elections.” October 5 2015 will mark a momentous day for Portugal. It is set to be the first day in office for a new government after four years of brutal austerity. Auspiciously, it will fall on the 105th anniversary of the birth of the Portuguese republic. But there will be no national celebrations to mark the overthrow of the monarchy. Portugal’s Republic Day was abolished as a bank holiday under a Troika diktat in 2012. For some, the abolition is a symbol of the subservience successive Portuguese government’s have shown to their creditor powers following a €78bn rescue in 2011.
Portugal is now lauded as a poster-child for austerity, swallowing its medicine and slowly returning back to health. The country exited its bail-out programme last year, returned to the international markets, and now benefits from ultra-low borrowing costs. Politically, the country boasts no mass social movement on a scale of Podemos, or a populist Left party such as Syriza. But its ascendant Socialists, in combination with a series of smaller Left movements are on track to take more than 50pc of the national vote come elections on October 4.
Socialist leader and former mayor of Lisbon, Antonio Costa has vowed to roll back austerity measures, halt fire-sales of the country’s assets and reverse laws on hiring and firing workers. With aggregate debt levels higher than Greece, youth unemployment over a third, and a record brain drain of approximately 400,000 people last year in a nation of only 10 million, Portugal’s chronic euro problems are far from over. “There are no poster children for austerity” says Rui Tavares, founder and leader of the up-start leftist Livre party. “We are living under very difficult social and economic conditions”. The 42-year-old cuts a similar figure to his Leftist Spanish and Greek counterparts – a former university professor who founded his party after serving as an MEP with Portugal’s Left Bloc and Green party. Tavares is also a vocal advocate of comprehensive debt relief in country where combined public and private debt is more than 370pc – the highest in Europe. He echoes claims made by former Greek finance minister Yanis Varoufakis for a debt conference for all member states modelled on the post-war Bretton Woods institutions. “No population in the north or south of Europe wants countries that are permanently dependent on bail-outs and hand-outs,” says Tavares. His nascent party remains on the fringes of mainstream politics, but like Podemos, Livre stand ready to have a major say in the coalition-making process. If in power, Mr Tavares aims to hold the Socialists feet to the fire and avoid a slide back into neo-liberal policies of old. By the end of the year, he foresees a eurozone dominated by Left-leaning governments in the southern Mediterranean – a bloc which Brussels and Berlin cannot ignore. “We will not speak all in one voice, but we will work together to produce a more reasonable and democratic path for the eurozone. The demands are clear: debt sustainability and a programme that will help us recover, redress, and relaunch our economies.”
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