Today, the European Union is confronted with a problem that has raised the spectre of an existential crisis. Its failure to counter the 2008 financial crisis has led to economic and social devastation throughout Europe, and with it, a surge in anti-EU sentiment for its harsh doctrine of seemingly endless spending cuts. People are quickly fleeing from the centrist, pro-EU political establishment in search of alternatives. They are finding the hope they are looking for in the radical left, which begs the question: has austerity failed in Europe? What began as a success story has over time born fruit of bitter taste.
The beginning of the European project, the result of which is the European Union as we know it today, can be dated back to the end of 1946, with the foundation of the European Federalists Union in Paris. How far we have come since then, achieving a single trade, a single currency, and, with the exception of the British Isles, a single area of free movement. An executive, a legislative and a judiciary have been established. Financial institutions have also been erected, vital in maintaining the continuation of the European project, particularly during the 2009 financial crisis. This crisis has, of course, led to major financial bailouts of various countries, in which a deal was struck: the bailed out government forfeits large portions of financial sovereignty to the EU in exchange for cheap loans, supposedly in order to heal an ailing economy.
Six years later, the bailouts have failed to live up to expectations. Austerity governments have a solid grip on power in many EU states with strict and unelected EU oversight. As a result, the left wing of the political albatross is beginning to flap. The latest reactionary trends in Greece and Spain are clearly a response to the dire social conditions suffered by millions, opening the gate to movements such as Syriza and Podemos.
The Hellenic Pandemic
The once sound foundations of the European Union were recently rattled by the swooping into power by Greece’s radical left, anti-austerity party, Syriza. Originally, Syriza was a coalition of left-wing factions in Greece, with quite a diverse membership that includes atheists, Catholics, Maoists, Greens, and Eurosceptic teens. But perhaps the most bizarre development is a coalition government with Syriza and the right-wing party the Independent Greeks. One question demands an answer: is the EU considered such a prominent evil that incompatible ideological groups can overcome their immeasurable differences to confront a common enemy? Surely it isn’t impossible. After all, the Third Reich and the Soviet Union managed to forge an alliance whereby arch enemies Adolf Hitler and Joseph Stalin came together to sign the Non-Aggression Pact. The deal was doomed to fail before it was signed. Considering two coalition partners in Greece’s new government share their ideological frameworks with these two titans of history, however loosely, could Greece’s new government succumb to the same fate?
As for Golden Dawn’s new prospects, voters churned out support for the neo-Nazi party at the polls in a combination of angered protest votes, a reaction to the deadly combination of large immigrant communities and mass unemployment, and the seemingly permanent fringes of authentic support. One would think that seeing the party’s leader, Ilias Kasidiaris, beating up a 60 year old woman live on television would at least be enough to keep him out of parliament, but instead the party walked away with a 7% chunk of the vote . The overtly anti-multiculturalist stance being adopted by parties like the Independent Greeks is to blame for the mainstreaming of far right clubs like Golden Dawn, paving the way for a the highly diverse ideologies in Greece’s new government. To conjure some sort of answer to this riddlesome game of ‘opposites attract’, let us look at the EU’s legacy in Greece.
In 2009, Greece saw its first tough austerity regime, when Prime Minister George Papandreou implemented a programme of public spending cuts as a reaction to cuts to the country’s credit rating by leading rating agencies Fitch, followed by Standard and Poor’s. But it failed to stem the tide of Greece’s ballooning 300 billion euro debt. As a consequence, two more rounds of tough austerity measures were announced the following year, in 2010. The public just couldn’t stand such an assault on their living standards and public services. They did indeed react.
The EU’s pride was at stake, and by now, they knew it. In light of the new disclosures revealing the extent of the Greek problem, the EU’s main statistical service, Eurostat, was found to be utterly toothless as it failed to uncover Athens’ dirty little secret in its stated mission “to provide the EU with a high-quality statistical information service”. In an attempt to stem the possibility of a Greek collapse, and possible embarrassment for the EU, a generous bailout package of $110 billion was organised. In exchange, Papandreou was persuaded to implement yet further reaching austerity programmes, with cuts upon cuts to public services, coupled with increases in taxes and VAT. Trade Unions launched a general strike in protest.
Ultimately, the trend was becoming obvious. Bailouts continued to be issued as the years progressed, tied with extensive conditions. Cuts continued to be implemented. Unrest continued to escalate. Even its democracy was under threat. In a doomed effort to win back a shred of trust with the public, Papandreou announced a referendum on a bailout package in October 2011, only to face a barrage of attacks from the EU and other creditors for the move. He quickly fled into the shadows, resigning as Prime Minister, but not before he cancelled the referendum.
By the time 2013 came around, Greece had received four bailouts, undergone countless austerity measures, and witnessed escalating violence in the streets and the highest unemployment rate in the EU (at 26.8%, later to reach 28%), with youth unemployment at 60%. Observers began to seriously consider the possibility that Greece may leave the Eurozone, with speculation renewed since the advent of the Syriza government. Meanwhile, Greece continued to receive rescue funds with attached austerity conditions as the situation appeared to deteriorate. Apparently the EU, in all its institutional triumph, is merely a one trick pony, as it implemented the same strategy time and time again while confronted with a worsening result. The trick didn’t work the first time. The reason as to why they continued to try it for seven years is a mystery requiring analyses far beyond the scope of this article.
Greece: the EU’s Red Star
The first sign of a turning tide was perhaps the triumphant and symbolic victory of the anti-austerity coalition in the May 2014 European elections, securing 26.6% of the vote. By now, the electorate of even the largest EU members were sending a message to the EU stating their dissatisfaction by electing Eurosceptic parties in a show of defiance, a comical situation which has seen seats given to France’s Front National, Britain’s BNP and UKIP, Greece’s Syriza, Spain’s Podemos, and others. This was to be, as it turns out, only the beginning of Syriza’s winning streak. On January 25th the EU was to blush red with embarrassment as Alexis Tsipras, leader of Syriza, claimed a healthy 36% of the vote in the Greek general election, ushering in a Eurosceptic, anti-austerity government, and perhaps with it, a turning point for the hitherto sound integrity of the EU.
Syriza’s ascension has gone hand in hand with the descent of the previously dominant moderate party, PASOK (Pan-Hellenic Socialist Movement), which went from a peak of 160 seats in Parliament in 2009 to a meagre 13 today. Although PASOK once represented the bulk of the left in Greece, their politically central position in government and their subordination to the EU, and, in particular, to the hated Troika (the EU Commission, the European Central Bank, and the International Monetary Fund, a triad of financiers responsible for the harsh austerity in the country) has seen its left leaning support base flock in great numbers to those groups which still uphold their left-wing policies with pride and integrity. PASOK’s crisis saw them haemorrhage supporters to Syriza. Even their leader, former Prime Minister Papandreou, was expunged. Syriza gained millions of supporters as it emphasised its anti-austerity stance, a strategy that evidently paid off in full.
The party stands as a bulwark against undemocratic conditions of the bailouts which have seen poverty in Greece rise to 40%, but it also stands against corruption. These policies appeal to the most prominent issues most Greeks attribute to the dire state of affairs currently suffered in the country. Furthermore, the diverse nature of Syriza itself, originally a coalition of various groups with various interests, has complimented its mass anti-austerity appeal. Support for the party, therefore, is both widespread and diverse. It includes feminists, anarchists, young and old, trade unionists, students, activists of many persuasions and environmentalists. Although such variety of support helps to elevate the party’s position in the polls, it also makes the task of maintaining support throughout its tenure in government all the much harder. Certainly, its alliance with the Independent Greeks won’t facilitate the task.
With a clear mandate for change being put into practise, Alexis Tsipras and the upper echelon of government have sought dialogue with Greece’s creditors rather than fulfil the EU’s worst nightmare, a unilateral exit from the obligations imposed on it by creditors. To this end, Greece’s new Finance Minister, Yanis Varoufakis, has conjured up a plan to make Syriza’s radical growth plan palatable to Germany and other creditors. A debt haircut of 50% has been proposed in order to free up Greek funds, which will otherwise be used to kick start growth and ease the painful social issues currently plaguing Greece. A second step towards recovery is a focus on growth and domestic reform. Radical change at abroad must be accompanied by equally radical change at home, to prevent accusations of political point scoring by attributing blame to the EU alone. Varoufakis has pledged to bring Greece’s institutionalised oligarchy to an abrupt end while severing the Troika’s austerity conditions, the former seen as a primary cause in devastating Greek finances to the point of a first bailout being needed, the latter seen as a cause of continuing a programme of ‘funds for sovereignty’, ultimately an EU power grab in Greece. Since the 1990s, a group of wealthy families has dominated Greek politics, controlling the media and currying favour with politicians in a bid to maintain the status quo. These politicians in turn have held onto power by aiding a few business and public sector elites, from facilitating tax avoidance to controlling public works, including the Public Power Corporation and Hellenic Railways Organisation. In 2012, a group of leading economists published a report on funds hidden in banks by tax evaders. It found that lawyers in Greece spend over 100% of their declared income on mortgage payments alone. This institutionalised oligarchy remains today despite intense scrutiny by the EU and IMF. Varoufakis vows to halt this system, and by showing creditors they are serious about change at home, Syriza can keep vital lifeline funds coming.
Some sceptics criticise Syriza’s plan for the future with a gleeful smile on their face, asking where they intend to get the money from in order to end the austerity programmes. Greece is faced with a $12 billion black hole that urgently needs to be plugged. Those smiles were quickly washed away when it was suggested that Greece could be bailed out by Russia. Such an event would give Russia much larger influence in the predominantly orthodox country than the EU, as the two countries, as Samuel Huntington argues in The Clash of Civilizations, are part of the same orthodox culture. But that would also imply that the Christian members of the EU are more likely to live harmoniously. This evidently is not necessarily the case, as can be seen in Spain and the rise of Podemos, a party similar in support and policies to Syriza, found in an economically, politically and socially dire setting to rival that of Greece.
Spain’s pain: Podemos rises from the fog of obscurity
The uniquely meteoric rise of the Podemos, now celebrating its first birthday, is an inspiration story set to motivate even the most pessimistic lefty to action. Winning over 1.25 million votes in the European elections in May 2014 and claiming 5 seats were no small feats considering the party was less than 5 months old. By the end of January 2015, Syriza inspired over 100,000 Spaniards to take to the streets in action against their indignant treatment at the hands of the EU. It is mindboggling that such a movement could appear as if out of nowhere to become a foremost star set for gains in the coming November general election. The questions on many minds are “How”? and “How can it be achieved here?”. Syriza’s ascent to power, and now the excellent prospects of Spain’s equivalent, gives hope to those anti-austerity movements all across Europe who wish to follow suit. But Podemos didn’t achieve its position simply by spouting anti-austerity and anti-EU rhetoric. It had laid the groundwork for its rapid rise.
Since the EU began to financially violate consecutive Spanish governments, two important things happened. Firstly, the two-party political establishment was grossly discredited, as both sides continued to implement harmful austerity packages while bailout funds of $100 billion to Spanish banks simply didn’t produce any results. The two parties were the Partido Popular (People’s Party, PP), a centre right party with historical ties to Franco’s regime, and Partido Socialista Obrero Español (Spanish Socialist Workers Party, PSOE). This perceived betrayal by the socialist movement led the PP and PSOE to be tied together with the single label PPSOE, an equivalent to Britain’s “ConDem” tag. Secondly, Spain follows Greece in its dramatically negative economic figures, reflecting the size of the EU’s failure in handling the crisis. School closures, healthcare privatisation, quadrupled tuition fees, slashed value of savings and thousands of evictions have become the order of the day. The last has led to suicide as a form of protest. To taint the scene further, Spain closely follows Greece in unemployment and youth unemployment, at 24% and 51% respectively. Such similarities make them inseparable centre stages for the left’s rapid rise. Over the course of seven years, various left-leaning political movements have arisen, evident by the healthy support enjoyed by the Occupy Madrid movement, Partido X (arisen from an anonymous hacktivist group), and Movimiento-15 (also known as M-15, Indignants’ Movement). The environment was ripe for the growth of Podemos as an anti-austerity party after the immense pain austerity has caused to countless Spaniards over the course of seven years.
Unlike these other movements, however, Podemos has a charismatic figurehead, who could engage in personality politics. In fact, Partido X was particularly careful to avoid precisely this. But for Podemos, it works. A professor in political science, blogger for small national newspapers and host of his own television shows, Pablo Iglesias Turrión has a solid base as a reputable public figure, which can be used to gain political credibility from the electorate, a public profile so vital to the rise of Podemos that the party used Iglesias’s face to represent the party on ballots, rather than the party emblem. Iglesias’s public renown pulled the party out of foggy obscurity faster than it could organise its own internal structure, making it a relatively loosely organised movement of leftists with a growing membership base. Regardless, the fresh party still packs the punch of a well aged whiskey.
The Madrid Mass March
In a show of defiance to EU’s eerily harmful presence in Spain, Madrid was recently the scene of a massive rally against austerity, with approximately 100,000 Podemos protestors and supporters. Madrid was awash with a flood of purple (the party’s colour) as the masses chanted “Si, podemos” (“Yes, we can”) and celebrated in euphoric triumph at the prospects that Spain could follow Greece in breaking the EU’s grasp. Iglesias could not have missed the event. “The wind of change is starting to blow in Europe,” he told awed crowds. “We dream, but we take our dream seriously. More has been done in Greece in six days than many governments have done in years.”
As Iglesias surges in the polls, a tougher line is being taken as a show of defiance. Promises of writing off portions of Spain’s debt are now part of the campaign. As the established political groups, now fallen from grace, attempt to tarnish the new leftist movement with the age-old strategy of making claims of financial misconduct, the leaders of Podemos react with promises to publish tax returns. Clearly the EU has much to be worried about if a movement like Podemos can arise from nothing to top of the polls in a year, and gather a massive show of support as seen in Madrid. And this was only one of the party’s first mass rallies, supposedly with many more to come. The EU has been left with a burning aftertaste after a key member state engorges on this spicy alternative, but whatever follows will likely enflame the situation.
Clearly a wind of change is blowing in Europe, and for Troika financiers, it brings quite a chill. The economic turmoil now raging across the continent is the result of seven decades of consolidation of a united Europe through increasingly complex networks of trade, production and finance, reigned over by a democratically deficient elite within what have today become the EU institutions so many resent with broiling anger. The unique situations in Greece and Spain, coupled with the groundwork firmly set before Syriza and Podemos ascended so rapidly to prominence, make such movements extremely difficult to replicate in other European countries. Each leftist movement has to adapt to its country’s economic situation and electorate to achieve success. But their odds may be boosted should they consider similar approaches like allying with the populist right, united by their common traits. Both Syriza and the Independent Greeks are anti-austerity and anti-EU parties, albeit in different ways. But once such issues become the biggest confronting a country, two such parties can temporarily overcome their differences to unite. Longer-term governance is unlikely. Differences will crop up in the form of other hot-button issues like immigration, which will likely destabilise the government in the run up to another general election. Syriza would have to significantly differentiate itself from its coalition partner to win a greater vote share. Indications that such alliances could surface elsewhere in the EU are boosted by Marine Le Pen’s public support of Syriza. Perhaps her party, the Front National, would be willing to side with a Jean-Luc Mélenchon’s Front de Gauche (Left Front), though the latter’s public pronouncements still indicate that this scenario is highly unlikely for the time being.
Syriza’s prospects for success remain to be seen, but so far their policy of avoiding a unilateral default, instead discussing alternatives, such as a multilateral arrangement to sell long-term debt packages with either a 50-year or even unlimited timeframe, has served to boost markets and quell creditors’ fears. This would successfully put Greece in a position to sell bonds without the responsibility of repaying them in the medium term, solving their current credit issues. Should such a plan be successful, recovery in Greece is indeed a very likely prospect. Podemos and other leftist movements can ride on Syriza’s success through emulation. Every Greek success brings other radical leftist movements a step closer to attaining power. For the near future at least, the EU will be sporting a red hue over its blue and yellow pride.