Voting has just ended in Greece, 7pm local time, today Sunday 5 July 2015.
Will it be a No, or a Yes?
In an effort to keep up with rapid developments about the Greek Referendum, I am posting here a written interview kindly provided by Daniel Albarracin, member of Podemos. The Spanish have been extremely supportive of Greece from the very first moment the Greek Referendum was announced. A massive demonstration was organised in the Madrid almost before there were any in Athens. To reinforce their already strong expression of support, Spanish people undertook symbolic voting for Greece in some places in Madrid today (https://left.gr/news/sti-madriti-stisane-kalpes-stis-plateies-kai-psifizoyn-ohi)
It is very interesting to think of these spontaneous events alongside recent developments on the gag law in Spain (The ten most repressive points of Spain’s gag law). I have no space to expand on this topic in this article (watch this space!) but will briefly refer to Daniel Albarracin’s comment in this interview that the destiny of the Spanish people is very closely related to that of the Greek. Daniel has a very interesting proposition about the future of Europe, should EU fail to undertake reform in a way that would guarantee true solidarity and democracy.
The interview included below is part of a series of interviews I presented live this week via the Independence Live Livestream channel, which were designed to provide key information and clarifications about the Greek crisis and the role of the Greek referendum in the current European politics. Daniel was very willing to contribute to the series, but was unable to join me for a live interview. I very much value his written input here, given that he has acted as member of the Truth Committee on Public Debt in Greece, and is in a position to share with us invaluable information. Please check the Independence Live website (www.independencelive.net) for the archives of the #Greferendum series 1, 2, 3 and 4.
1) Who do you believe is responsible for the failure of the negotiations between Greece and EU?
In my opinion, the Eurogroup put too much pressure on the Greek government. Although the latter would have accepted to make amendments to its proposal, the Eurogroup and the IMF refused to consider, not only the original points that the Greek Government had included in this proposal (such as the restructuring of the debt and tax reform), but also its several amended versions. It is clear that the former Troika cannot accept that indebted countries are entitled to have their own approaches. Instead, it is all about confirming IMF’s financial domination. Taking advantage of the Greek government’s kind and reasonable approach, the IMF tried to defeat the Syriza government even further through blackmailing. But this was too much abuse and humiliation, an unfair and aggressive attitude that the proud Greek government could not tolerate.
2) You were one of the members of the Truth Committee on Public debt. What did the Committee find out and how relevant are your findings in today’s crisis? http://cadtm.org/Executive-Summary-of-the-report
A group of thirty analysts were asked to assess the case of the Greek Public Debt within the last thirty years, with a special focus on the Memoranda of Understanding period. In this report’s chapter addressing the Greek debt from a microeconomic point of view, we showed that the increase of public debt started in the 1990s due to a snowball effect created by the high interest rate applied during these years. After the implementation of the euro, the Greek debt continued to raise, yet this was due to an “increase of private debt in Greece to which major European private banks as well as the Greek banks were exposed” as mentioned in the Executive Summary of the Report. Against what most people think, our report showed that public expenses in Greece were a little lower than the average in EU. In a context of corruption, expenditure on military defence was one of the highest in EU during these years, which is another reason why Greek public debt increased. The problem became increasingly serious in the post-2010 period due to the austerity measures imposed by the two memoranda of understanding, which caused a decrease of 25% of GDP in Greece. A vicious circle was firmly established during this period, and Greece became a prisoner of this debt.
The Truth Committee also showed in its report how 90% of the loans were not used to strengthen the Greek budget in order to cover expenses related to the general interest of the Greek population and the development of the Greek economy. Instead these were used to repay old debt. We also showed how the public European institution has replaced the former private creditors in order to protect them from exposing themselves to risk. This means that we are in front of a paneuropean sharing of losses operation. We, the people of Europe, have been forced to carry the losses of the creditors, who imposed an unfair debt to the Greek people.
In the Truth Committee report, we also showed how several EU Member States made loans to Greece under strange conditions, not only bilateral loans -lending from a Member State to another, something that is forbidden within the EU legislation-, but mainly mutualised funds such as the European Fund Stability Facility, and its successor the European Stability Mechanism, which are completely illegal in the framework of the EU legislation, breaching the EU Functioning Treaty. The 48% of the Greek Debt is property of this sinister fund.
3) What do you think about the Greek referendum: was it the right choice?
Tsipras had no choice. If he had accepted the harsh conditions of the former Troika that would meant the end of its democratic mandate. He could have made his own decision, but he chose to consult the Greek population. He chose to put the will power of the Greek people above the creditors’ interests. My opinion is very clear about this. Greek people have many reasons to vote No to the conditions that the Eurogroup put to the Greek government last week, but it is necessary to go further. We have to know more about specific solutions to Greece’s current problems that a No majority will bring. These would include ways of intervening with banks, combining perhaps the euro with some other currency (IoU, electronic money, or a new drachma). A progressive tax reform, an investment plan and a new international financing framework are amongst the most important issues to be defined in the next days. People have to watch what kind of future they are facing.
4) How do you envision Europe’s future if Greece will vote No? And what if Greece says Yes?
If No wins, then the Government has to implement immediately a scheme responding to the questions I mentioned above. Is Yes wins that could lead to general elections, and a new vicious circle of austerity in Greece, accompanied by people’s negative feelings that have been defeated. But the devil is in the details and we need to have information about all the issues I mentioned above in order to know exactly how to evaluate the impact of the No, or Yes, in this Referendum.
5) Is ECB playing a fair game with Greece?
The ECB has not developed a neutral independent policy, but has clearly acted against the mandate by the Treaties. We have seen how the ECB speculated with Greek bonds in 2012, buying them very cheaply in the financial market, giving a sweetener or compensation to the former private creditor, and expecting Greek people to pay at the original value afterwards. We have observed how ECB has not disbursed or make feasible the access to the normal loans and financing that other countries have received, for example recently the Quantitative Easing. Greece has been discriminated by ECB, and there are more than one reasons to criticise its behaviour.
6) Do you believe that, if winning the elections in Spain, Podemos could encounter the same hostility that Syriza is facing now?
I am afraid that this is something that could easily happen. We have to be in solidarity with Greece, because our destiny might be very similar. We have to learn about the paths Greeks are going through right now. And if they lose this battle, we have to prepare so that we can face together the next one.
7) Is another Europe still possible?
I have no doubt that another Europe is possible. But I am afraid that the current EU architecture impedes on the potential of a Europe of solidarity. If it becomes obvious that it is not possible to change this in the EU, we will have to explore the building of a new supranational solution based on proper democracy and solidarity with whichever countries are able to meet this challenge.
1. #Greferendum 1: interview with Michael Kosmides, ex-producer, Greek department, BBC World Service
2. #Greferendum 2: interview with Steve Freeman, candidate of Republican Socialists, British General Elections 2015.
3. #Greferendum 3: interview with Thoralf Dassler, member of the German socialist party Die Linke.
4. #Greferendum 4: interview with Jonathon Shafi, co-founder of Radical Independence Campaign, and Myrto Tsakatika, co-ordinator of SYRIZA Scotland.