The European Union leadership will never pardon Syriza -- and the Greek people for the NO vote -- which with the referendum of July 5 brought to light the real nature of the neoliberal system of the EU, in its full nudity. This is why the EU is demanding a capitulation of the Syriza government to policies of austerity, without which the expulsion of Greece from the EU zone will be a fact.

The President of the European Commission (EC), Jean-Claude Juncker, said it quite clearly: "I am firmly against a ‘Grexit’, but I could not prevent it if the Greek government does not do what it should do. The Commission is prepared for everything. We have a scenario for a ‘Grexit’ prepared in detail.”

The expulsion of Greece from the euro zone should be prepared as of Sunday, July 12, unless the Prime Minister Alexis Tsipras accepts to continue applying the austerity plans. All that the government and the people of Greece will get in exchange is a vague promise that "afterwards we shall look at the question of the sustainability of the debt" from the German Chancellor Angela Merkel, which comes accompanied with the following clarification: the cancellation of debt is "something prohibited by the Treaties of the Monetary Union."(1)

As this article is written, the European Parliament, sitting at Tsipras's request in order that this body, the only one with democratic representation in the governing system of the EU would be aware, monitor and take position on a negotiation that --Tsipras explained -- always took place behind closed doors, between the Greek government and the Troika (the CE, the European Central Bank and the IMF), three bodies of which two -- the ECB ad the IMF -- are not subject to democratic scrutiny. Jean-Claude Juncker, present in the session, had to recognize the validity of this complaint.

The intervention of the Greek Prime Minister was clear and precise. He affirmed that the negotiations of the past five months took up the greater part of the time and energies of his government, but in spite of this they did not cease to take measures for a reform that would involve an increase of income and the reduction of state expenditures, revealing the dossiers of fiscal evasion, corruption and contraband that previous governments (who had said yes to all the austerity policies of the Troika) never investigated or executed. And he emphasized that he had begun to legislate in order to introduce the necessary reforms.

Tsipras exhorted the European deputies to understand the need to restructure the unpayable debts, that do not only affect Greece and whose resolution is necessary for a European project that respects democracy as expressed by the popular will.

Capitulation or expulsion from the European zone?

The leading members of the EU, instead of accepting the clear defeat in the referendum of July 5 in Greece of their obsessive policy of austerity, and showing a will for a dose of realism with policy changes, as claimed by well-known economists such as Paul Krugman, the first thing they did on July 6 was to present an ultimatum to Tsipras: there will be negotiations only if the economist Yannis Varoufakis steps down as Minister of Finance (2).

Why should Varoufakis leave and what proposals of the Greek plan were not acceptable? Daniel Munevar, advisor to the ex-Minister Varoufakis, said to RT (3) that the plan presented by Greece accepted an increase in the VAT rate in exchange for maintaining the exceptions enjoyed by the Greek islands, and that the restructuring of the debt is one of the key points in the negotiations with international creditors.  "If the IMF asks for restructuring and the Europeans say they are not so disposed, it is very difficult for the adjustment programme to have any economic logic when the decisions are made on fundamentally political criteria".

Munevar added that Varoufakis's proposal included "a petition for the restructuring of the debt" that would be financed "through the European Stability Mechanism taking into account the damage provoked by the measures of the ECB by refusing to extend liquidity to Greek banks in spite of this being part of its mission". And he added that "it appears that tragically the calculation that is being made in many European capitals is that it is easier to justify the expulsion of Greece from the euro zone -- in spite of the fact that it would be clearly illegal according to the treaties of the EU -- than the restructuring of the debt of the country".

The declarations from the referendum of July 5, made by those who control the process of decision-making in the EU, indicate that they have taken provisions for the expulsion of Greece from the euro zone, the "Grexit", unless Tsipras capitulates and accepts the conditions of the Troika. This will be decided by those who follow the negotiations closely in the days to come.

This grave crisis of political legitimacy of the EU was foreseeable, as Steve Richard wrote (The Independent, July 6, 2015): "Political union cannot result from a monetary union", although perhaps the contrary might possible. 

The political repercussions of this situation, either a capitulation of Syriza or the expulsion of Greece from the euro zone, go well beyond the EU: a capitulation under the threat of expulsion increases the internal contradictions and will irredeemably damage the legitimacy of the EU, in Europe and worldwide. The expulsion of Greece from the euro zone will hardly leave the USA indifferent, they have already revealed their position to Germany and --according to well-informed sources -- Washington already has a plan to prevent the exit of Greece from Nato or from establishing closer relations with the BRICS group, to Russia and China in particular. That is to say, the expulsion of Greece from the euro could add their name to the list of countries that will be destabilized to achieve “a regime change". (4)

All this perception of the EU crisis has ceased to be an affair of radical leftists. It is enough to hear an interview with the former French foreign minister Dominique de Villepin, who spoke of the need to "have imagination" in order to fix the European financial crisis (5). With Alexis Tsipras we are fortunate to have a Greek Prime Minister who is young and independent (...) one of the solutions should begin with the restructuring of the debt, even a return of the debt. And thus invent a new mechanism: do it in such a way that the Greek repayments go, in priority to Greek investments.

Villepin said he was afflicted "by European blindness" and criticized that it means assuming "the risk of returning Greece to the instability of the Balkans, to the powder keg of the Middle East and the fragility of the Maghreb. Europe needs to stabilize its borders. We are incapable of inventing a large project. We are not true democracies, so we should stop giving lessons to others, we have become media democracies. Today our leaders speak for the microphones and cameras, but they forget their peoples".

The British journalist and writer George Monbiot underlined in a Guardian article (6): "Greece may be financially bankrupt, but the Troika is politically bankrupt", and he goes to the depth of the question when he writes that the EU practices an extreme version of "market fundamentalism", to which one might add that the EU and the euro are part of the neoliberal imperialism that has transformed into an absolute and untouchable dogma the two definitions that Margaret Thatcher forged: "there is no alternative" and "society does not exist".

The rigidity of this model, based on absolute dogma as is proved by the austerity policies, the negative response to the restructuring of unpayable public debts, the threats of expulsion from the "common currency", the strangling of democracy in questions that involve the well-being or the suffering of peoples, all this condemns the system to collapse.

The blow of the Greek referendum revealed the social and political contradictions of this rigid system as one sees in the declarations of the politicians and bureaucrats of the EU. Recall that on July 6, after a meeting in Paris with Angela Merkel, President François Hollande said that the EU "is not only a monetary and financial system", giving to understand that social and political questions have to be taken into account. The next day, after another meeting with Merkel, he declared that before all else they had to keep Greece in the euro zone, but that "there was another option, an exit with a programme of accompaniment (...) France has an obligation to envisage this option".

The vice-President of the EC, Valdis Dombrovsky, questioned the legitimacy of the referendum and said that "debt relief is not negotiable", that the result of the referendum had "dramatically weakened" the capacity for negotiation of the Greek government and "complicated things even more so that it is probable that the result has left things with no possibility for anyone to come out with a gain". And, to be more clear, he emphasized that there would be no funds for Greek banks unless they provide assets in pledge".

The Dutch Prime Minister, Mark Rutte, left open the possibility of an expulsion from the euro zone when he said that "it's all over" if Greece would not accept the reforms demanded by the creditors: "Do the Greeks really think that after voting NO we would welcome them and ask What more do you want?" Rutte emphasized that his government would provide no financing for Greece.

An adept of the most orthodox neoliberal politicians, added a tone of contempt: the President of Lithuania, Dala Grybauskaite, stated that for "the Greek government it’s always ‘tomorrow’ (…) every day can be ‘tomorrow’.” (The Guardian, July 8, 2015).

A dispatch from the Bloomberg agency (7) resumes the opinions of the six leading countries of the EU, concluding that "after five months of drama, false dawns and disagreeable surprises, the European leaders are finally ready to show Alexis Tsipras the exit".

Greece could be expelled, but the problem remains

This asymmetric confrontation, with so many political, social and economic consequences, both for Greece and for the rigid system of the EU, can hardly give rise to a negotiation that could find a just solution to what is really at stake, such as the restructuring of the Greek debt (and in the future those of Spain, Portugal, Italy and eventually France), with a reasonable solution.

However, and this is something that has been achieved thanks to Syriza, from now on the restructuring of the public debt cannot be easily discarded from the agenda in the negotiations with indebted countries with the Troika or at the political level.. The question of the renegotiation of the debt remains even if Greece be expelled.

This is not the only political crisis that threatens the future of the EU, since with its submissive attitude to the dictates of Washington, Nato played a central role in the coup d'état in Ukraine (that the US financed with five billion dollars, no less) to encircle and pester Russia, a key country for any economic development of the EU. Then, with the referendum in Crimea and its union with Russia, the EU applied extensive commercial and political sanctions against Moscow, which have affected the economies of member countries of the EU. Curiously, US businesses continue to increase their commerce and investment in Russia.

With respect to the theme of the refugees who arrive from across the Mediterranean sea, due to the military interventions and subversive actions of the US and certain countries of the EU that have destroyed various societies and economies in the Middle East and Africa, the response of the EU has been military (let the boats of the illegal immigrants sink), policing (prevent illegal immigrants who arrive in one county from moving into another EU country) and authoritarian (each country of the EU is obliged to accept a quota of illegal migrants).

Not to speak of the Treaty with the US for the Transatlantic Trade and Investment Partnership, which faces great opposition at many levels of society in EU countries, but which will probably be signed by the EU leaders, confirming that the "gigantic European economy" cannot have an independent policy to defend their legitimate interests, establish peace and prevent the return of militarization and war in Europe.

It is in this way that the real character of this system is exposed to political debate under the light of day in the nations that make up the EU. Our experience tells us that it is a monetary and financial system at the service of Big Capital, and not of the societies of the nations that make it up.

For this reason, it is important, even necessary, to study the Greek process, the rich and instructive experience of the formation of Syriza, the political and ideological diversity of its components, the practice that allowed it to reach its great political maturity and in particular the close and fluid relationship that it maintains with the people and which was manifested in the result of the referendum.

The Syriza government has acted openly and transparently, based on its principal duty to protect society, rather than the interests of foreign or national banks, and defend what is left of national and popular sovereignty. What takes place in the days to come should be interpreted as part of a process in this asymmetric struggle to free the Greek people.

We must recall that in their governmental conduct Syriza kept the people informed on the negotiations with the Troika, their intransigence in not wanting to discuss a restructuring of the debt and their demand for even more severe policies of austerity, even in spite of the IMF document -- dated June 26 -- that demonstrates with figures that the Greek debt is unsustainable and will aggravate the economic consequences of the austerity programme (8).

08/07/2015

(Translated for ALAI by Jordan Bishop) 

Footnotes:

1.- Les Echos: http://www.lesechos.fr/monde/europe/021194038840-les-europeens-mettent-tsipras-au-pied-du-mur-un-accord-ou-le-grexit-dimanche-1135552.php?dAqSTHparYMrtvE4.99

2.- Declaration of Yanis Varoufakis. The Greek Minister of Finance wrote the following in his blog: “Like all struggles for democratic rights, so too this historic rejection of the Eurogroup’s 25th June ultimatum comes with a large price tag attached. It is, therefore, essential that the great capital bestowed upon our government by the splendid NO vote be invested immediately into a YES to a proper resolution – to an agreement that involves debt restructuring, less austerity, redistribution in favour of the needy, and real reforms.

Soon after the announcement of the referendum results, I was made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my… ‘absence’ from its meetings; an idea that the Prime Minister judged to be potentially helpful to him in reaching an agreement. For this reason I am leaving the Ministry of Finance today.

I consider it my duty to help Alexis Tsipras exploit, as he sees fit, the capital that the Greek people granted us through yesterday’s referendum.

And I shall wear the creditors’ loathing with pride.

We of the Left know how to act collectively with no care for the privileges of office. I shall support fully Prime Minister Tsipras, the new Minister of Finance, and our government.

The superhuman effort to honour the brave people of Greece, and the famous OXI (NO) that they granted to democrats the world over, is just beginning.”

http://yanisvaroufakis.eu/2015/07/06/minister-no-more/#more-8433

3.-RT en español: http://actualidad.rt.com/actualidad/179512-munevar-varufakis-claves-nueva-propuesta

4.- John Hellmer, NUDELMAN’S NEW WAR, NULAND’S NEMESIS – WILL GREECE, OR WON’T GREECE BE DESTROYED TO SAVE HER FROM RUSSIA, LIKE UKRAINE? http://johnhelmer.net/?p=13712

5.- Dominique de Villepin, http://www.bfmtv.com/politique/villepin-avec-tsipras-on-a-la-chance-d-avoir-un-jeune-premier-ministre-independant-900285.html

6.- George Monbiot : http://www.theguardian.com/commentisfree/2015/jul/07/greece-financial-elite-democracy-liassez-faire-neoliberalism

7.- http://www.bloomberg.com/news/articles/2015-07-08/eu-tells-tsipras-the-party-s-over-as-euro-exit-door-swings-open

8.- FMI, June 26 2015, GREECE, PRELIMINARY DRAFT DEBT SUSTAINABILITY ANALYSIS  https://www.imf.org/external/pubs/ft/scr/2015/cr15165.pdf y The Guardian, 30 de junio 2015 http://www.theguardian.com/business/2015/jun/30/greek-debt-troika-analysis-says-significant-concessions-still-needed