Owen Jones, among many other political journalists, was quick to clarify that the Greeks’ decision to reject EU bailout proposals following a referendum on Sunday was a ‘win for democracy’. The ‘No’ result – winning with 61% of the votes and forming the majority decision in all Greek constituencies and sub-regions, showed that Greece was no longer willing to bend to the whims of the European Union – an institution which appears increasingly undemocratic as the negotiations go on. In the midst of a financial crisis, with the entire country on the verge of bankruptcy (and some economists claiming that Greece has been virtually bankrupt since 2011 due to the Eurozone crisis), it is clear that the forced austerity measures imposed under its last government have failed to have the desired effect. Unfortunately for Greece’s recently formed Syriza coalition, the old cliché of ‘right place wrong time’ could not be truer. They are struggling to bear the burden of an economic crash which was not caused by their party nor their policies yet appear to receive more than the brunt of the blame for Greece’s current financial situation. Before the results of the referendum, there appeared to be a beacon of hope found in Greek finance minister Yanis Varoufakis yet his sudden resignation after the ‘No’ vote success raised suspicions. It is possible that the Eurocrats saw his confident, laid-back political style and clear economic competence as rather too much of a threat and therefore have refused to negotiate further with him regarding plans for Greece’s economic future.
It is disappointing to note Germany’s unwillingness to erase Greece’s debt, particularly seeing as Greece was one of the signatories of the London Debt Agreement of 1953 which agreed to cancel 50% of Germany’s war debt. Nobody can deny that Greece has in the past participated in some shady economic activity, yet perhaps it is the bureaucracy of the European Union that is somewhat to blame for this. For example, in order to join the Euro in 2001, Greece was forced to hide $5-10 billion of debt in order to fit the European terms of entry in the hope of providing their citizens with a stronger currency and therefore a better way of life. Negotiations with foreign (particularly German) bankers led to the creation of a credit bubble (much like created before our own economic crash in Britain) which of course was bound to burst at some point. Yet the point is that it wasn’t simply the actions of Greece’s own bankers and politicians that got them into such a financial mess and it is unjust to rest the current burden of near-bankruptcy completely upon Greece’s already frail shoulders. Moreover, it’s clear that those most affected by the financial crisis are those who played no part in its making, therefore to continue to impose austerity measures and further impoverishing the Greek working classes completely undermines the so-called ‘moral standing’ of the European Union.
It’s clear that whilst the referendum result can be seen as a short term success, Greece’s future still hangs in the balance. Nobody is quite sure whether their rejection of EU bailout proposals will lead to their exit from the Euro, or if the regression back to their own currency is the best solution to the crash. Although austerity has been proven not to work, it is the preferred option for the fat cats in the European Union as it best helps to maintain financial stability solely in the interests of the rich. Greece has shown incredible strength and resilience in rejecting European bailout measures, leaving them more ‘wiggle-room’ to ensure better negotiations. Syriza seem to have the best of intentions when it comes to sincerely believing in the need to improve the quality of life for those worst affected by the harsh austerity measures that have plagued the Greeks over the last few years… let’s just hope that they can best realise these intentions and create a stable economic framework on which to build even in the face of European hostility.
Words by Beth Chaplow