Efklidis Tsakalotos was interviewed by E. Ahmet Tonak for sendika.org in Turkey. Tsakalotos has a doctorate from Oxford, is professor of economics at the University of Athens, a member of Parliament with SYRIZA and responsible for the economic policy of Syriza.
Ahmet Tonak: Why is it so important for Greece to stay within the EU in a period where so many centrifugal forces are threatening at it, when it presents neither economically, nor politically a promising future? Does the EU represent the sole viable international alternative to a withdrawal into the national state? Is it not worth to fight for a socialist alternative at the European level, i.e. a United Socialist States of Europe?
Efklidis Tsakalotos: Precisely because there are so many centrifugal political forces! We in SYRIZA have said from the very first moment that the euro is at risk not from progressive forces but from the policies of austerity. As we know all forms of fixed exchange rate systems are threatened in times of recession and mass unemployment. Progressive people should fear that the break up of the euro could lead to a straight re-run of the 1930s: competitive devaluations, rival nationalisms and worse.
Ahmet Tonak: Even if Greece remains within the EU, why is it so important for Greece to remain in the Eurozone, given that many countries, not only the Euro-sceptic UK, but also Sweden, a country smaller than Greece, have kept out of it from the beginning? Is it safe to assume that the euro will definitely be able to weather the storm? If not, then why take the risk of a collective bankruptcy?
Efklidis Tsakalotos: Our support for the European project is strategic, no just tactical, as the previous answer made clear. What SYRIZA has argued is that problems such as debt constitute supra-national problems that must be redressed at the supra-national level. But this also goes for a whole set of other problems: confronting financial markets and multinational corporations, tax competition among economies, climate change and so on.
The idea that what would follow a collapse of the euro would be a better basis for integration does not seem to be one that has the backing of history. Once again the specter of the 1930s looms large.
Ahmet Tonak: Syriza seems committed to implementing the Thessaloniki plan in which both raising the minimum wage and instituting a Job Guarantee program are especially important for workers. What are the realistic options for funding such policies? Is it really likely to use European Union funds for Job Guarantee jobs? Would a suspension of interest payments of foreign debt also be an option?
Efklidis Tsakalotos: The Thessaloniki plan is a set of short-term measures that we propose to implement irrespective of the process of debt renegotiation. Thus they are accompanied by ideas for how they will be funded, from the restructuring of the tax system to the broadening of the tax base by confronting tax evasion, to plans to sort out tax arrears and the problems of non-performing loans – there are people who cannot pay at the moment but could do so if they got a fairer deal about future payments.
Beyond that we will be negotiating for a new financing agreement with our creditors, which will mean severely reducing the unrealistic targets for primary fiscal surpluses over the next few years. Such targets are central to the current programme’s strategy to make the Greek debt sustainable, but few economists believe that this constitutes an economically, let alone socially, viable strategy. Should we be successful, then this will release resources for investment to start the process of restructuring the economy in the aftermath of the crisis.
Ahmet Tonak: Given its foreign debt/GDP ratio of 174 per cent, the epicentre of the trials and tribulations of the Greek economy is without any doubt the payment of the usurious foreign debt. It seems obvious that the dominant faction of European finance capital is adamant on having Greece pay its debt in full and will have none of the negotiations that Syriza wishes to conduct. So it seems inevitable that, unless Syriza steps back on the issue of foreign debt, European finance capital will submit Greece to a severe withdrawal of capital, possiblyleading to a financial default of the country. Since this is a foreseeable possibility, would it not be safer to take precautions immediately and, for instance, block the capital account and nationalize the banking system?
Efklidis Tsakalotos: We shall see whether this is the case or not. Markets too do not believe in the sustainability of the current programme. But beyond this, at the political level it will not be easy to ignore the democratic mandate of the Greek people. Such a stance would send a very powerful message to others in Europe that the EU cannot incorporate democratic processes and alternative social priorities. This is not a small consideration, given the existence of centrifugal political forces you mentioned above. These may be of the nationalist right, as well as of the Left, but it is not clear that the EU can survive showing such disdain for some core European principles, such as democracy and social justice.
I remind you that after SYRIZA, Podemos in Spain, and Sinn Fein in Ireland are also running high in opinion polls. Something is changing within Europe and labour needs to be as well organized as capital on this level. It is a battle that must be fought.
Ahmet Tonak: What, in your opinion, are the prospects of a rise of Golden Dawn as a serious contender for power in the case of economic turmoil and failure of the economic policy now being advocated by Syriza?
Efklidis Tsakalotos: The danger is clearly there. Without a progressive exit from the crisis, a form of authoritarian capitalism may well be a likely outcome, and not just in Greece. Greece’s Golden Dawn presents, therefore, a more extreme version of a more general latent tendency.
Ahmet Tonak: Let us assume for a moment that despite the barriers set up by European finance capital and the Greek bourgeoisie, Syriza goes from victory to victory, gaining the full support of the working class and a majority of the Greek population. Where would Syriza wish to take Greece under those circumstances?
Efklidis Tsakalotos: Syriza’s programme is a transitional one. It wants to start the process of not only reversing the policies of austerity but also dismantling some of the central pillars of the neo-liberal order. As with all transitional programmes the goal is to open up fissures for more radical polices. Whether we in Europe can achieve this depends on the extent that social movements are inspired to make use of the opportunities that arise to broaden the agenda in favour of a more participatory, institutionally-diverse, and socially just economy. Left-wing governments can do only so much. Social transformations, especially in the modern era, need the active engagement of millions. Parties and governments of the Left must see their role as catalysts of these wider developments. What is certain is that we are living in interesting times!
E. Ahmet Tonak is a journalist based in Istanbul, Turkey.