This week the slow-burning eurozone crisis reaches its most critical stage yet. I expect most readers of this blog will be familiar with the story, and sympathetic to the plight of the Greek government and people.
Greece’s creditors – the so-called ‘Troika’ of the European Central Bank (ECB), the European Commission and the IMF – are insisting that the Syriza government implement harsh economic measures it believes it does not have a mandate to impose, and which would further depress an economy already in ruins after five years of extreme austerity.
Since 2010 Greece’s economy has shrunk by a quarter, real wages have fallen by a third, and one in four are out of work, including 60% of those between 18 and 24. Homelessness has soared, healthcare has been rationed and the rate of infant mortality has risen by more than 40%. The state pension, which itself has been reduced by 50% to an average of around 700 euros a month, is now the primary means of subsistence for millions: in today’s Greece it is the retired who support the working population, not the other way round.
And yet a further reduction in pensions has been top of the Troika’s list of conditions for the release of further funds to allow Greece to service its debts. Syriza has said no, describing its creditors demands as ‘criminal’. Billions have been withdrawn from Greece’s banks over the past few days as the prospect of a Greek default and eurozone exit looms (though this morning’s reports suggest a last-minute deal may yet be possible).
The intransigence of the IMF and the ECB in doling out more of the same economic medicine that has devastated Greece has been condemned by observers of both the left and right. It is ever clearer that Greece’s creditors are motivated by political rather than economic objectives: they want to warn Europe’s other debtor nations that there will be no adjustment to the terms of their loans, and – it seems – to intensify the Greek crisis to force the collapse of the Syriza government to make room for a more compliant administration.
Looking on from Scotland we might agree that the situation is intolerable, but wonder what it has to do with us: a dispute on the EU’s eastern border about membership of a eurozone that no party in Scotland or across the UK is suggesting that we join.
But I want to suggest two reasons why the crisis should be of particular interest to Scottish Labour, and why the party should declare public support for the Greek government.
Firstly, standing with Greece at this time should be a moral imperative for a party of the left. Scottish Labour, whatever the domestic issues with which it is preoccupied, has always sought to look beyond and take a global perspective, to speak out on international issues. In the past those have included apartheid; today they include climate change and the Israel/Palestine conflict. In Greece, unbelievably, we are witnessing a humanitarian crisis in a developed Europe state: we should not be neutral.
Secondly, I suggest that expressing support for Greece would have symbolic value, sending several political signals important for Scottish Labour to communicate at this time of existential crisis for our party. Here are three:
Crucially, it would help begin the process of breaking Scottish Labour’s successful typecasting by its opponents as a cautious ‘pro-austerity’ party of the establishment.
The Greek crisis is important for us all because it has become the primary battleground for the clash of competing political and economic worldviews fighting to set the future direction of Europe.
Syriza is the first party of the left since the financial crisis to have taken an uncompromising stand against the politics of deficit reduction the right has sought to impose across Europe. Alexei Tsipras’ administration is dismissed by its opponents as extremist, an unworldly experiment in government by a seminar of Marxist professors, or the editorial staff of Verso Books.
But in opposition and in government Syriza has not sought to make a case for revolution, but rather the simple restoration of the cardinal social democratic principle that the state has a crucial role to play in fostering economic progress and ensuring that that the rewards of growth are distributed fairly.
The Thessaloniki Programme on which the Syriza was elected, and the prolific writings of party intellectuals like Finance ministers Yanis Varoufakis and Euclid Tsakalotas attempt to renew the classic principles of social democratic political economy, including state-led investment, Keynesian demand management, the defence of the rights of labour, and the importance of strong public services for economic security and a healthy, well educated workforce. The historic significance of Syriza’s defiance has been recognised by many of the world’s leading economists and political commentators, including Amartya Sen, Paul Krugman and Thomas Piketty.
Here in Scotland it made waves within the Scottish left, which has proposed the setting up of a ‘Scottish Syriza’ to run in future Holyrood elections. Whatever we in Scottish Labour might think of the need for such a party, we need to demonstrate awareness of this fundamental debate, and, as a party of the left, make it clear that we are on the side of those seeking to develop a coherent alternative to the economics of austerity.
National issues require international solutions
Support for Greece would also serve to demonstrate Labour’s historic understanding that the political and economic challenges individual nations face have international dimensions: the ability to think in global terms to which I’ve already referred.
In today’s global economy it is unclear whether ‘social democracy in one country’ is possible, let alone socialism. Governments sympathetic to social democratic ideals need to work together to assert the rights of working people against international finance.
This understanding of collective agency helped Europe recover after the devastation of two world wars, as European governments followed broadly similar expansionary economic programmes to develop prosperous new welfare states. It is at the heart of what remains of the ideal of a ‘social Europe’. And its potency was demonstrated just a few years ago when G20 economies acted in concert in the immediate aftermath of the financial crisis to ward off the pressing danger of a world-wide depression.
This global perspective informs Scottish Labour’s unapologetic support for the UK and the EU: we understand that Scotland’s prosperity is bound up with that of the rest of the UK, which in turn is thoroughly integrated with that of Europe. Only by retaining influence within the UK and the EU can Scotland influence the economic and political levers of the larger economies within which it is embedded.
By proclaiming our support for Greece, and the efforts of the European left to set the EU on a new economic course, we demonstrate our understanding that Scotland’s challenges have an international dimension.
Saying what we think
A statement of support for Syriza would also send a strong signal that Scottish Labour means what it says about its willingness to act, when it judges it right to do so, independently of the wider UK Labour Party.
There will be disagreement within the wider party about Greece. Some will take a more conservative line, prepared to give the EU the benefit of the doubt regarding its intentions in regard to Greece. Some will be anxious not to upset centre-left EU networks within which Labour MEPs are embedded, or simply not to be seen as meddling in matters they don’t believe to be our affair. Indeed, of the Labour leadership candidates only Jeremy Corbyn, to my knowledge, has expressed unequivocal support for the Greek government, or indeed any view at all.
But right now, during this time of profound crisis for Scottish Labour, I don’t believe there is much merit in holding our tongue for fear of giving offence. Our Westminster representation has been all but wiped out, and at the time of writing we are more than 30% behind in the polls for Holyrood: whatever we might say, the electorate simply does not believe that Scottish Labour has the agency or willingness to speak its mind freely.
We must be prepared to speak out when we think it right to do so, whatever some in the wider party might think: signalling support for Greece is one way of doing that.
The Greek crisis might seem peripheral to Scottish political debate. But we should be prepared to stand with those suffering injustice. And our support for Syriza would help demonstrate that we are serious about developing alternatives to the extreme economics of austerity being enforced across Europe; would underline our belief that national challenges require international solutions; and would show that we are quite capable of asserting our right to speak for ourselves.
We need, urgently, to demonstrate all of those qualities to an electorate that isn’t listening to us, and seems prepared for the foreseeable future to entrust Scotland’s leadership to others.