John Weeks
Faced with a decision that would conflict with its promises to the
Greek people no matter what choice it makes, the Syriza government has
taken the obvious step required in a democratic society – it will ask
its citizens for guidance by holding a referendum.
It appears that many commentators on both the left and the right find
this exercise in democratic decision making incomprehensible. For Paul
Mason of the
Guardian it is a “
last desperate gamble”
that threatens to destroy the “far left” Syriza government should the
electorate not vote to reject the bailout terms of the infamous Troika;
aka “the institutions”, made up of
Wolfgang Schäuble (aka Eurogroup of finance ministers), Mario Draghi (European Central Bank), and
Christine Lagarde (International Monetary Fund).
For Chancellor Angela Merkel’s number two from the Social Democratic
party, Sigmar Gabriel, Alexis Tsipras represents nothing less than an
existential threat to “the European order”. A view allegedly shared by the politicians making up “Europe’s big guns”.
The message coming from the near-hysteria popping up across the
political spectrum is that we have a lot of “experts” out there for whom
the exercise of democratic decision making is so unexpected as to be
exotic and in many cases threatening.
Calling the decision to seek the advice of the electorate a
“desperate gamble” provides insight to an author’s view of the
democratic process, that its real purpose is to keep and consolidate a
government’s power, not to serve the interests of the citizenry.
The Syriza government has done something simple that is totally “out
of the box” in semi-authoritarian and neoliberal Europe. It tells its
citizens that it has decided in favor of a rejection of the Troika
bailout terms; though this is likely to contradict its campaign pledge
to remain in the euro zone.
It asks its citizens to endorse that decision, in which case it will
continue in government; or, if the referendum vote goes in favor of the
bailout terms, the government will resign and call a new election. If
this is a “desperate gamble”, I wish we had more
punters in governments across the globe.
The So-called European Order
A few commentators have avoided the Grexit hysteria and pointed out
that the Syriza government and the Greek citizenry find themselves
confronting difficult choices with uncertain outcomes, but susceptible
to rational assessment. For example, Joseph Stiglitz considers the
binary choice of accepting or rejecting the Troika terms and decides
that
he prefers the latter (an unexpected choice for someone who in 2011 wrote that
the Greek debt was sustainable).
More insightful have been articles in the
Financial Times by Wolfgang Münchau. As early as
February he concluded
that establishing a parallel currency in anticipation of a euro zone
exit represented the rational policy choice for the Syriza government.
But for the governing politicians of the European Union 5 July will
not bring an exercise in democratic governance. Rather, it represents
nothing less than a threat to the established order in the European
Union and, even more, in the euro zone. The alarmist statements by the
German Vice Chancellor and the crocodile tears of Jean-Claude Juncker
alleging that
Alexis Tsipras “betrayed him”
(analogous perhaps to an infidelity) seem on the surface little more
than clumsy attempts to influence the outcome of the referendum.
But these EU-elite laments should be taken seriously, because the
Greek referendum and the government that initiated it without question
are existential threats to the neoliberal order of the euro zone and the
European Union. For at least thirty years the common threat through all
of the EU “reforms” and moves toward “
an ever closer union” has been the erosion of democratic accountability.
German Vice Chancellor Sigmar Gabriel
The assertion in Greece of the principle that a government governs by
the consent of the electorate has come as a profound shock to
politicians and bureaucrats entangled in the web of EU mis-governance.
This principle, famously stated by
John Locke,
represents the antithesis of the governance of the European Union. An
anonymous member of the Eurogroup is quoted as saying that the austerity
package for Greece designed by the Troika is “complex”, and “
so technical to explain that a normal citizen, not people like us, would find it hard to form a view“.
This quotation encapsulates the anti-democratic nature of the Troika
and EU pro-austerity politicians in general, that economic and social
policy are purely technical matters. The creation of the “independent”
European Central Bank in 1998 represented a major step to disarm
democracy in the countries of the European Union, though its
anti-democratic effect would not begin to manifest itself until the
introduction of the euro a year later. The ECB is for all practical
purposes unaccountable to any democratic process. On the ECB website we
find a
statement of its accountability, which consists of reporting to the EU Parliament, monthly publications and “regular press conferences”. By comparison the
US Federal Reserve looks good with its cosmetic inclusion of “representatives of the public”, as does the Bank of England’s
Monetary Policy Committee.
But the raw attack on democratic accountability appears in the
various EU “pacts” that constrain fiscal policy. The best known of
these are the Maastricht Criteria that specify limits to national fiscal
balances and public debt (“convergence criteria” in EU speak). These
rules have gone from being technically incompetent (they contradict
IMF guidelines
for “sound fiscal management”) to draconian and authoritarian by the
addition of subsequent restrictions on national policies. The infamous
“Fiscal Pact” (
Treaty on Stabilisation, Coordination and Governance) requires governments
to amend their constitutions to prohibit budget deficits greater than 0.5% of gross national product.
The non-accountability of the ECB ensures that the national
governments of the countries of the euro zone – and therefore the
citizens of those countries – have no control over monetary policy. The
Fiscal Pact goes far to do the same for public spending and taxation.
National budgets must be submitted to the neoliberals in Brussels for
approval (see Article 3 of the Treaty).
The Eurogroup Runs its Course
On Saturday 27 June at about 5 pm in Brussels the other members of
the Eurogroup of finance ministers told Yanis Varoufakis that they would
issue a final “offer” to his government without him, and he would not
be part of the discussions to write that document. Varoufakis promptly
left the meeting (rather than being ejected by EU security officers one
presumes).
The ejection of Varoufakis sends a clear message. The euro zone is a
club that requires strict adherence to neoliberal economic and social
ideology. An exercise in democratic decision making should not and
cannot result in policies outside the constraints of the rules that
institutionalize that ideology.
It may be that the refusal of euro zone leaders to allow any
substantive flexibility in Greece’s bailout conditions will see off the
only challenge to the neoliberal European order, and thereby consolidate
market friendliness in Europe for generations to come.
It is also possible that we observe in the actions of euro zone leaders the tragic flaw of
hubris, defined in ancient Greek drama as “excessive pride towards or defiance of the gods, leading to Nemesis”. In this case the
vengeance of Nemesis may take the form of the deterioration of the “ever closer union” into an ever more fractious disunity.
