Greek prime minister Alexis Tsipras claims that the agreement with the Eurogroup negotiated by finance minister Yanis Varoufakis will provide the new SYRIZA government with room to begin carrying out promised reforms to ease the country’s humanitarian crisis.
But critics on the left believe the agreement is a wholesale retreat from the party’s commitment to reverse austerity.
In this article in Workers Left, the newspaper of the Greek socialist group Internationalist Workers Left, a cofounder of SYRIZA and now part of the Left Platform, Panos Kosmas explains what the next four months will look like under the terms of the Eurogroup deal.
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Regardless of how the agreement with the Eurogroup is finally assessed, one thing is certain: it ensures neither a truce nor relief for the next four months.
Having started negotiations with a proposal for a four- or six-month “bridge” – the funds necessary to cover the government’s financial needs during a period of negotiations toward a comprehensive agreement – the government ultimately agreed to a “bridge” toward accepting the general framework of the Memorandum and the European elite’s monitoring mechanism in Greece, but without ensuring the financing it needs for the coming four-month period!
The Eurogroup agreement provides 7.2 billion euros as the last instalment of the current bailout program, along with 1.9 billion euros owed to Greece as the proceeds of bonds held by European state banks.
But this will come at the end of the four-month period, and only after the Troika “institutions” decide, according to their whim at the time, if the Greek government has implemented the “reforms” and avoided unilateral action.
Until then, the Greek government has large debt repayment obligations. It must also renew three government bond issues at a total value of 4.6 billion euros. These obligations continue in the coming months.
The result is that the financial suffocation of the Greek state will not only continue – it will return on harsher terms than ever.
[German finance minister] Wolfgang Schäuble continues to insist that if Greece fails to meet its obligations, it will be pushed into bankruptcy.
With the Eurogroup agreement approved, the threat of the immediate collapse of Greek banks has diminished – but the threat of Greece being forced into bankruptcy has come closer.
With the primary surplus falling due to the sharp drop in government revenues in January and February, the government has even less funds to address the immediate financial needs of the government. In order to address these needs, it is planning to use funds that belong to public institutions (like the agency in charge of agricultural subsidies or the hospitals).
The problem with this “solution,” aside from the fact that it constitutes voluntary austerity, is that the government will give the lenders another weapon of blackmail. Returning these funds to the public institutions – that is, paying the agricultural subsidies, financing the hospitals – will now depend on living up to the Eurogroup agreement in order to receive funding at the end of the four-month period.
If it is confirmed that Varoufakis’ statements about honouring the agreement and showing “goodwill” toward the lenders of the commitment to remain in the eurozone at all costs is indeed the course of the government, then this will represent complete submission to the Memorandum framework and the signing of a new Memorandum.
This would be against the spirit of the decisions of the recent SYRIZA Central Committee meeting and the official statements of Alexis Tsipras and other leading members of the party that the Eurogroup agreement provides breathing space to begin implementing SYRIZA’s election commitments.
The aim would be to push the boundaries of the agreement and take advantage of any “creative ambiguity” in order to build up popular support and international solidarity that would allow the government to say “no” to the blackmail in June, and move toward abolishing the Memorandums.
It’s obvious that Varoufakis is heading in a very different direction from this path. His statements in the media are not only erasing the official positions of SYRIZA on issues like debt and privatisation at a rapid pace, but he is – with his talk about showing “goodwill” to the lenders – imposing his own positions as those of the government.
There are two possible interpretations of his statements. Either he is doing all this on his own initiative, and thus creating a pole within the government for social democratic policies. Or he is doing so with the collaboration of Alexis Tsipras, which means the situation has gone much further.
In either case, he has shown in a matter of a month that he is completely unsuitable for carrying out the promises and commitments made collectively by the members and different forces of SYRIZA.
In the face of the extortion faced this month, the only possible answer is: “You can’t take something from someone who has nothing.” The repayments of interest on the debt and the IMF loan must be suspended. And in the face of the wider extortion and the lenders’ strategy for isolating SYRIZA and pressuring it into representing a government of “national consensus,” or forming a “national unity” government, the only solution is to organise disobedience and resistance to an agreement imposed by the lenders at the point of a gun.
