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Oligarchy, Corruption and The Greek Crisis.

Oligarchy, Corruption and The Greek Crisis.

Oligarquía, corrupción y la crisis griega

Paul Mason

The historic electoral victory of Syriza, Greece´s left-wing party , calls into question the rigorous economic austerity policy imposed by the European Union. This triumph, according to a recent study done by The Economist, could mean that a political and economic earthquake can trigger the rise of antiestablishment parties in countries such as Spain, United Kingdom, Sweden, Finland and even Germany, with the subsequent crisis in the EU from its foundation. In the following interview, Paul Mason (collaborator for The Guardian and specialist in the topic) exposes his point of view over something people are already calling the “European spring.”

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Rose Mary Salum: The IMF predicted Greece would grow as the result of its aid package in 2010. Instead, the economy has shrunk by 25%. People are obliged to live with less than 500 euros a month. What else can be asked from the Greek people? In your opinion, what solution could actually work given the current situation?

Paul Mason: Both sides in politics believe there has to be debt rescheduling. But the conservatives and the centreleft were trying to do a deal that put repayment off into the 2060s, while keeping the whole burden of debt, requiring austerity forever. The IMF and EU asked Greece to run a 4% of GDP budget surplus – which most economists think is impossible.

So the new government is not being that radical when it says the debt is unpayable. Its radicalism lies in its solution, which during the whole EU crisis has been resisted by other states: a debt writeoff and a moratorium on repayment and interest on the rest until the economy grows.

Thats why this is no longer just a Greek issue: the precedent of a write off of public sector debt – to other countries and the ECB – is massive, because the governments have only so far forced private bondholders and savers to take the hit.

Once a deal is done, the key is to get Greece growing – and the microeconomic reforms Syiza wants to do have never been tried in a country so damaged by neoliberal dogma.

Over three general elections Syriza’s achievement has been to politicize the issue of the oligarchy. Can you elaborate on how the Greek oligarchy has been an obstacle for the proper development of the country?

Yes, really clearly. One night I was with a young, technocratic member of Pasok and he said to me: I am supposed to go to a party organised by the elders of Pasok. But I don’t want to go because it will be like the party Michael Corleone throws at Lake Tahoe in Godfather II. That’s how the business school and law graduate young technocrats feel about the way both parties were run for forty years.

The problem is, when they finally got around to forming a centre-left, technocratic party prepared to take on the rich, tax-evading families, Syriza had already captured that agenda.

Over the course of four decades, the two parties carved up the Greek state. Every new minister brings politically appointed civil servants – so there’s no continuity. A landfill site that was supposed to be in location A, gets moved to location B. Plus – and this is shocking – there is complete acceptance of the political control of policing. So when I was in a theatre being beseiged by fascists, lobbing stones into a courtyard because the actors put on a gay play, the manager phoned – and got through to – the Minister of the Interior, not the chief of police.

As a result of oligarchy, a Greek motorway costs three times more to build than a French motorway. And the key industry – shipping – is effectively tax exempt. The state becomes a negotiating chamber between corporate interests, and never stands above them.

So the kind of reforms and capacity building needed are actually the ones you would use in a recently democratised Latin American dictatorship!

The youth is tired of corruption and tax evasion. How are they responding, and what are their proposals? In other words, how have the younger generations changed the political landscape?

The youth swarmed into Syriza. And to an extent into To Potami. But there are also many anarchist-inspired youth who even now didn’t vote, and simply live a marginal and bohemian life. The commonly quoted uncome for graduates with three low skilled jobs is 400 Euros a month. You can rent a large apartment for 350, and six of you sleep in it. That’s how they live.

But its important to note that with a few exceptions, the youth are not powerful in Syriza. Greek society is patriarchal – with a lot of respect for men with grey hair, even in a radical party like Syriza. It’s HQ is a bit like the senior common room of a University. That’s the key to understanding why so few women got into the cabinet. It is a party that still operates with implicit concepts of seniority and competence.

You’ve reported the Greek crisis since it began. In your opinion, how does this problem affect the global market?

 As a default, any Greek default would not destroy the global market. More imporant is its symbolism. This is as big – probably bigger – than the victory of Evo Morales in Bolivia, or the Sandinista Revolution: it’s the first time in modern history that a far left party, from outside the Moscow tradition, has come to power. So for example its macro policies are Keynesian, and will be heavily constrained by the deal with the IMF/EU. Its micro policies already include a lot of experimentation with peer-to-peer and network economics, like installing mesh networks in mountain villages, and co-op experiments on the land.

Do you think Greece should exit the eurozone? If so, what would be the consequences?

Exiting the Euro would be big: the Greek middle class is psychologically anchored to the Euro as a symbol of democracy and global integration. But after the shock of leaving, and the disruption, Greece would be able to devalue, attract investment and take control of its own policies. It would have to default at the same time, because the debts would be unpayable. But after the way they’ve been treated by a German-dominated EU, a lot of Greeks no longer think leaving would be a disaster.

Cover image: (AFP/Getty Images)

YoDeltaRose Mary Salum is the founder and director of Literal, Latin American Voices. She´s the author of Delta de las arenas, cuentos árabes, cuentos judíos among other titles.

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