Greece: Why I support Lafazanis

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Greece is entering yet another period of early elections. This has become a constant feature of the country’s political life under the bailout programmes. Without willing to engage in speculations concerning the possible outcome and/or concatenation of events leading to it, I here outline my rationale for supporting Popular Unity (Laiki Enotita), the breakaway party of former Syriza leftists, headed by Panayiotis Lafazanis.

To preface my argument, I must note that I am both a leftist and a European republican (federalist): I am, in principle, for the establishment of a European Democracy, founded on a codified constitution, which for practical purposes will operate as a federation. I have claimed over a series of analyses that this ideal is not realised in the existing European Union or the Economic and Monetary Union. These are inter-state-treaties-based inter-governmental, quasi-confederal architectures which by their very design are inexorably, even if inadvertently, deviating from democratic norms.

Greece has a number of endogenous factors contributing to its economic, social, and humanitarian crises. While one ought not attribute the country’s structural malignancies to some singularly obstinate “Europe”, the fact is that the specific regime of austerity policies implemented in Greece has only exacerbated the problems, exerting downward pressures on the lower parts of the income distribution, further impoverishing those already living on the poverty line, without addressing the fundamental causes of the crises.

Greece, just like every other European Union Member State whose currency is the euro, is not an economically sovereign country. Its monetary policy is trusted in the hands of the European Central Bank, an institution which pursues its narrow “price stability” mandate, without accounting for economic conditions, fiscal dynamics, and context-dependent political needs.

That is so because:

  • no fiscal capacity: there is no counter-party European Treasury to the ECB with the capacity to raise taxes, issue bonds, and address asymmetric shocks in line with cyclical fluctuations;
  • no common economic policy: there exists no Ministry of Finance, no European Chancellor of the Exchequer with the power to, inter alia, set on an annual basis the inflation target;
  • false mandate: the mandate of the ECB does not include any social-economic indicator, such as unemployment;
  • disproportionate institutional independence: the legal basis of the ECB stems from inter-state treaties, which means that no parliament, be it the European or any national one, can conduct an ex post review for the sake of amending it in parts or in whole.

[Also see On the institutional independence of the European Central Bank]

On the fiscal front, the state is bound by a complex, interweaving web of rules that severely constrain the scope of social-reality-aware economic policy. These namely are the Two-Pack and Six-Pack of Community regulations, and the Fiscal Compact, which are meant to substantiate provisions in the Treaty on the Functioning of the European Union concerning “economic governance”, as well as calcify the rigid rules of the Stability and Growth Pact.

To cut the long story short, every state is forced to labour in a framework of “common rules without common politics”, to act as if it were economically sovereign, while no common European policy is in place to ensure graceful adjustments to the trade cycle. On a more practical level, every state participates in the European Semester, a mechanism for monitoring annual national budgets and, in fact, for forwarding the agenda of the unique brand of euro neoliberal mindset.

Precisely because the European Union or the Economic and Monetary Union are not genuine republics, technocratic and increasingly arcane workarounds are set in place to ensure the [sub-optimal] functioning of the system. The locus of authority in Europe is in inter-governmental arrangements, manifested in the European Council, the Council of the European Union, and the quasi-legal entity of the Eurogroup. EU/EMU inter-governmentalism is damaging the ideal of a united Europe: it is pernicious for a number of reasons, not least because it has time and again been proven subject to abuse in line with circumstantial power relations.

Instead of the system working to promote the common good and to exercise concerted action for the sake of ameliorating the pressures in some of its parts, in this case Greece, it expects from that state to comply with economic-reality-independent rules regardless of the deleterious ramifications their implementation will have on the social fabric.

Greece cannot live with the euro. It cannot continue to pursue the chimera of euro-inspired “competitiveness”: a euphemism for the politics of wage repression, instantiated in the drive for repressing direct and indirect labour costs.

I was among those who believed that Syriza was a force for good, for cutting ties with Greece’s clientelist past and the “mind-forged manacles” that underpin the bailout programmes: the false narrative of there being no alternatives to austerity and, more recently, the self-valorising obsession that has led to the transfiguration of an elected government into a group of filling clerks tasked with rubber stamping its creditors’ edicts.

Given the current state of affairs, with the specific constellation of forces in Europe’s inter-governmental entities, which are not willing to proceed with the creation of a European Democracy, I believe we face a clear trade-off: national democracy or the quasi-confederal technocratic construct of the EU/EMU.

I am a cosmopolite. I do not perceive of national democracy as an end in itself. Reclaiming it is an intermediate objective, meant to salvage popular sovereignty, and to buy us sufficient time until we find the most suitable modalities of common political life in Europe and beyond. Assuming the lack of consensus to orderly dismantle the single currency, this means unilaterally breaking free from the euro, which I interpret as exercising the right to withdraw from the Union if nothing else applies.

Though it embitters me, this Europe, the current EU/EMU edifice, has become inimical to genuine democracy and to any form of economic organisation that deviates from the euro’s canon. This order will not be reformed by the forces that have designed it to be what it is.

While I do not know whether Popular Unity will prove capable for the task, I am hereby documenting my principled support for their cause. There comes a point where the enactment of real reform is contingent on the rupture with the status quo.