Still dabbling with fascism at the 11th hour
Tsipras has his work cut out for him. On one side, he is trapped between those knuckleheads in KKE and Left Platform who appear bent on restoring the SU. On the other side is the whole of western capital, who wants him dead and his bloodied corpse displayed in Berlin.
“We warned readers that the creditors had implements of torture that they had yet to deploy. The forced choice of a bail-in versus a Grexit is the ugliest, but the fact that the ECB has used this weapon before (under its “we’re just following the rules” excuse) means it might resort to it again. Since this post is already long, we will save the description of some of the other possible discipline mechanisms for future discussions. … The consensus is moving away from our initial view, that the best solution for Greece is a default in the Eurozone. The problem is that the country remains in what I’ve called the creditor sweatbox, without a primary surplus due to the deterioration of its economy. It has to pay pensioners and government employees in scrip.”
Smith does nothing at all to sugar coat the dire situation facing SYRIZA at this point: Once Greece defaults, the ECB will use this as a pretext to shut down Greece’s banks, lock Greece out of the Target2 payment system, wipe out the bank bondholders and expropriate both small and large depositors. Then, if the ECB has its way, it will be able to expropriate the financial wealth of the country and force Greece to leave both the euro and EU.
“An economy hamstrung by capital controls, a government without any cash and a banking system struggling on life support, Greece would essentially begin a drawn-out process of economic suffocation.”
Of course, here is the part that all of these doomsayers overlook: The argument has a big hole in it, since it assumes SYRIZA will lead “a government without any cash”. The SYRIZA government has a lot of cash, but its expenditures are larger still. It simply has to bring its expenditures into line with its tax base and do this without imposing still more austerity on Greece’s citizens. This is not difficult at all — it just means SYRIZA has to go after the bloated state sector, which cannot pay its own way under any circumstances, by reducing the hours public employees are expected to work. Once this has been done, SYRIZA will no longer be a government without any cash, since its non-wage costs consume 70 percent of its budget.
The Left has dabbled with fascism for too long and now it is being forced to make a choice: attack the working class or the existing state. On which of these options SYRIZA chooses hangs the balance of its survival and the immediate prospects of Europe. The radical Left has been driven into a corner from which there is no hope of escape nor possibility of escape. It dropped the ball in the 1930s and plunged the planet into an unimaginable catastrophe. If it does it again, the Left will not get a third chance.
The Greece nation state is dead and its counterparts will soon follow it. If the Left tries to save this disgusting hangover from previous epochs, it will be dragged into the grave with it.