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Category archive for: Greece

Greece with the Left in government again

Written by Dimitris Sourvanos and Kyriaki Nanou.

Last week Euclid Tsakalotos gave a talk at the LSE discussing from his own experiences – as (the current) finance minister in Greece and as a lifelong Marxist – the difficulties that left-wing parties are faced with when governing under severe constraints. The Greek finance minister said:

It’s difficult for a left-wing Finance Minister to have any left-wing credentials. {…} The deal of July is only as good as the strategy you have to incorporate it in a left-wing direction. The final test of the deal for the Left is not given a priori.

He also added that although the Greek government disagrees on certain aspects of this deal (e.g. pensions, non-performing loans); it is important that it gives space for alternative experiments in in other sectors (e.g. healthcare system) where there is still an “open space”. Continue reading Greece with the Left in government again

Austerity and Resistance: Greece in the Eurozone crisis

By Andreas Bieler and Jamie Jordan.

Concerns over Greece’s ability to pay back its debt continue unabated, with one crisis meeting taking place in Brussels after another. While the media focuses on Greece’s ability to meet the conditions by the European Union, in this post we will have another look at some of the key underlying dynamics of the crisis.

It is often argued in the media that citizens of richer countries would now have to pay for the ‘profligacy’ of citizens from indebted countries. Cultural arguments of apparently ‘lazy Greek’ workers as the cause of the crisis are put forward despite the fact that Greek workers are amongst those who work the most hours in Europe (McDonald 2012). Rather than the result of Greeks living above their means, however, the crisis is a reflection of the highly uneven European political economy. While Germany and other countries of the European core have pursued a growth strategy based on exports, countries in the European periphery including Greece followed a strategy of demand-led growth often financed with loans from abroad. Nevertheless, it would be wrong simply to blame the Greeks for this situation. The super profits resulting from German export success needed new points of investment to generate more profits and state bonds of peripheral countries seemed to be the ideal investment opportunity with guaranteed profits, backed by sovereign states. In a way, Germany has recycled its profits in the form of lending to peripheral countries. In turn, these credits to the periphery were used to purchase more goods in the core ensuring a continuation of the German export success. Hence, the recurrent distinction between credit- and export-led economies is misleading. Firms in core countries would not have been able to pursue export-led growth strategies, if global aggregate demand had not been supported by the real estate and stock market bubbles that occurred in the periphery as a result of lending. German export success, in other words, depended on Greece’s increasing indebtedness.

Continue reading Austerity and Resistance: Greece in the Eurozone crisis

The Greek government, EU policy constraints, and the tension between responsiveness and responsibility

By Kyriaki Nanou

In January 2015, after failure to agree on the nomination of a president, national elections were held in Greece – a country at the eye of the storm of the Eurozone crisis. The main opponents were New Democracy, the main party in the governing coalition arguing in favour of the necessity of the memorandum agreements and the continuation of the reforms as part of the external support package; and, on the other side, SYRIZA, arguing that there is a different way for Greece to exit the crisis – involving renegotiation of the the terms of the bailout agreements and not undertaking all of the reform measures. Together with its governing partners, New Democracy stressed ‘responsibility’ and argued that Greece had no other way out of this crisis but to implement all of the austerity measures, which it argued had already improved the state of the economy, and to satisfy external creditors and EU partners. Their campaign was focused on a rightist agenda underlying the dangers of deviating from the implementation of the painful reforms, which had the potential of upsetting the creditors, stopping the transfer of further payments and leading to a potential ‘Grexit’ from the euro. On the other hand, SYRIZA emphasised ‘responsiveness’ and argued that politicians should listen to the needs and concerns of Greek people, who were disillusioned with austerity politics. It had a leftist agenda that aimed to provide hope to the Greek electorate by promising measures that would ease the burden of austerity – by either not implementing planned reforms or by changing or reversing some of the reforms implemented by the previous government.

Continue reading The Greek government, EU policy constraints, and the tension between responsiveness and responsibility