Greek Prime Minister Alexis Tsipras issued a nationalist appeal, aimed at winning backing for his government as it seeks debt renegotiation with the European Union, in his first speech to the parliament following the win by Syriza in elections two week ago.
Yesterday’s speech was delivered as the government faces a crucial series of meetings this week, with euro zone finance ministers holding a discussion on Greece this Wednesday, followed by a full European Union summit meeting on Thursday.
Last week, the European Central Bank tightened the screws on the Syriza-led government when it withdrew the waiver on the use of government bonds as collateral for loans to the country’s banks. The move was aimed at increasing pressure on Syriza to accept the dictates of the “troika” on the €240 billion bailout package, which forms the largest component on the more than €300 billion of Greek government debt.
The present agreement expires on February 28, but Tsipras declared the government was not seeking an extension because “the bailout failed.”
“We want to make clear in every direction what we are not negotiating. We are not negotiating our national sovereignty,” he said to cheers from the 300-member national parliament.
In the clearest indication of the right-wing and bourgeois character of his government, Tspiras brought his speech to a climax by announcing that his government would be seeking World War II reparations from the German government.
Tsipras said his administration was a “government of national salvation” and declared he would push to have loans extracted by the Nazis during their wartime occupation of the country repaid. “I can’t overlook what is an ethical duty, a duty to history … to lay claim to the wartime debt,” he said.
The demagogic demand forms part of Syriza’s efforts to forge an anti-German coalition among sections of the European bourgeoisie aimed at securing concessions on the austerity agenda. It was also a direct appeal to extreme right-wing, anti-German and nationalist forces within Greece, underscoring the significance of his coalition with the nationalist Independent Greeks party established within a day of Syriza’s election victory.
Tspiras is also looking to support from Washington, where there are fears that unless some compromise is reached, there will be problems for the global economy and a new financial crisis if Greece is forced out of the euro zone. The Financial Times has reported that the Obama administration has been lobbying against the hard-line stand taken towards Greece.
“This isn’t a special initiative. I don’t think our attitude has changed but what’s changed is that suddenly the situation in Greece is looking more problematic,” a senior US official involved in the discussions told the newspaper.
Earlier, US President Barack Obama appeared to give some support for an easing of the austerity agenda when he said in a CNN interview last week: “You cannot keep on squeezing countries that are in the midst of a depression.”
British Chancellor George Osborne revealed over the weekend that the Cameron government had drawn up contingency plans for a Greek exit from the euro zone, and that such an event would not only have a severe impact on financial markets but would cause “real ructions” in the UK.
Former head of the US Federal Reserve Alan Greenspan said it was only a matter of time before Greece left the euro zone as there was not going to be an agreement, while warning that an exit might trigger a new global financial crisis.
In his speech to the parliament, Tspiras issued a series of pledges, including a freeze on pension cuts, an overhaul of property taxes, restoring electricity to those cut off and an increase in the minimum wage. But these limited measures, even if they were to be carried out, go nowhere near to reversing the economic devastation inflicted on the Greek population over the past five years.
The bourgeois character of the Syriza regime is made clear by the fact that it is not seeking the overturn of the financial oligarchy and the impoverishment it has imposed, but simply some room to manoeuvre. Having abandoned Syriza’s election pledge for a debt write-off, Tspiras now calls for a renegotiation of the bailout agreement with what he refers to as “our European partners.”
In proposals set out by Finance Minister Yanis Vourafakis during his tour of European capitals last week, a renegotiated deal would be based on a series of debt swap arrangements, aimed at lessening the immediate impact of repayments but without any actual write-off of the country’s debts.
In the short term, the government is seeking “bridging finance” of at least €10 billion to ensure that it has sufficient cash over the next three months, while negotiations take place.
“We want a new deal, a bridging program, which would give us the fiscal space that a sincere negotiation requires,” Tspiras told the parliament while insisting that Greece would honour its debts. He said the government was not asking for an extension of the present agreement “because it cannot ask for an extension of mistakes.”
But the ECB’s decision to withdraw the waiver on Greek bonds demonstrated its hostility to the request. This was underscored by Jeroen Dijsselbloem, who chairs the euro group of finance ministers of euro zone countries, in remarks last Friday. He said Greece would have to apply for an extension under the present arrangements, adding: “We don’t do bridging loans.”
Attention will now focus on the meeting of euro zone finance ministers on Wednesday. If no agreement is reached, it will signify another step towards a crisis of the Greek banking system and a possible withdrawal from the euro zone, with potentially major consequences.