The Greek Referendum of 2012

What is the Greek for Schadenfreude? One person who is saying nothing in the current Greek drama is George Papandreou. His socialist Pasok government tried desperately to keep Greece afloat after the bankers’ crash on 2008. But northern European banks especially German and French had flooded Greece with low interest Euros after Greece joined the single currency. The level of government and personal debt was so high that Greece was de facto bankrupt five years ago.
Greeks were also keen followers of the US corporate law firm, Baker & McKenzie, which advises Starbucks and many other firms on how to avoid taxes. The Chicago based legal behemoth had a slick European corporate lawyer who became head of their western European division. Her name is Christine Lagarde.
If it was good enough for Baker and McKenzie reasoned many a Greek it is good enough for me as they simply avoided paying taxes as much as any properly advised global firm.
The two ruling parties in Greece – Pasok and New Democracy – all failed to cull tax evasion and all took money from the EU or from German and French banks without any real plan on how to pay it back.
Papandreou had been a brilliant foreign minister in an earlier Pasok government and took over as Greece’s Prime Minister in 2009 as Greeks rejected the clientalism and tax avoidance culture of the right-wing New Democracy party which by then had reached epic heights.
Papandreou with his LSE and American university education, his fluent Swedish from his time as a child in exile in Sweden during the Colonel’s rule in Greece 1967-1974, promised a process of modernisation based on northern European standards of government administration.
But the deep conservatisms of the Greek political system blocked him, including from many old guard Bourbons in his Pasok party. Their resistence to reform was too great to overcome using normal parliamentary means.
So in 2011 he proposed holding a referendum in order to go over the heads of the Greek tax-avoiding elites and the politicans unable to break free of clientalism. The question would be a blunt one. Should Greece stay in the Eurozone and accept a period of reform including harsh austerity to relaunch the nation on a path of EU modernisation?
The old guard politicians hated their idea in Greece. But as Arnaud Leparmentier of Le Monde wrote in his award-winning book, Ces français, fossoyeurs de ‘L’Euro (‘The French – gravediggers of the Euro’) Angela Merkel, Nicholas Sarkozy and Christine Lagarde were horrified at the idea of a referendum which could lead Greece to reject the orthodox austerity ideology which the Eurozone and the European Commission then controlled by EPP politicians like José-Manuel Barroso, Jean-Claude Juncker, Nicolas Sarkozy and Angela Merkel were imposing across Europe.
Merkel and Sarkozy browbeat and bullied Papandreou into withdrawing his referendum proposal. Now four years too late the referendum will be held but not as a bold move to force Greeks to accept their responsibilities but as a mechanism to cover up the disastrous negotiating failures of the hard-left oppositionist party, Syriza, which has not been able to make the move to government responsibility since taking office in January.
European and Eurozone politics remains deeply partisan and political and Merkel and Sarkozy used the failed Papandreou referendum to secure his ouster and the arrival in power of their EPP comrade, New Democracy’s Antonis Samaras.
However having propelled him into office, the dominant EPP rulers in the EU refused to help him with any serious measures to reduce the crushing debt burden on Greek shoulders. Samaras dutifully obeyed orders from Merkel, Juncker and Lagarde. But their belief that bleeding the Greek patient to near death would restore health failed as any sensible economist could have told them.
Enter thus Tspiras, Varoufakis and a Syriza consisting of old Trotskyites, older Communist, and a handful of academics who had waited 30 or 40 years to play at being ministers.
The disaster of the Tsipras-Varoufakis arrogant, get-stuffed, we’re right and you’re wrong negotiating style alienated everyone in Brussels including all natural sympathisers for Greece on the social democratic left.
The surreal referendum for next Sunday has its 90-word long question based on an EU document which is now withdrawn. To call a referendum without a public information campaign and with most Greeks bewildered what it means as they queue to get Euros out of ATM which are being shut down is the height of anti-democratic cynicism. If it produces a No vote can easily lead Greece out of the Euro, perhaps even the EU.
And with Greece gone, other weaker Eurozone members like Portugal, Italy, Ireland and Spain will be next in line.
Tsipras and Varoufakis are urging a No vote and anti-Europeans from London and Paris are flocking to Athens to urge a big No vote to help weaken the EU.
The referendum stunt has provoked anger all over Europe as Tsipras treats the business of government as a students’ union debate.
If there is a Yes vote and Syriza’s call for a No is defeated he should in honour resign. Fresh elections are needed to get a consensus government that can reform Greece and stop its drift away from Europe.
But history will judge that the right time to hold a referendum in Greece was in 2011 as George Papandreou proposed. It would have cut the Gordian knot of Greek rejection of facing up to the need for reform and an end to the tax dodging clientalism that disfigured Greece after it entered the European Community in 1981.
Papandreou has all but withdrawn from Greek national politics and devotes most time to global centre-left politics and teaching. But he might be allowed a smile today as the error of Merkel and Sarkozy in rejecting a referendum at the right time in 2011 comes home to roost and instead Greece faces a plebiscite that may mark the first step in the Euro being unwound.

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