Two days after he ousted Greek’s conservative government in an emphatic election victory, Mr. Tsipras, 40, assembled a new, streamlined cabinet dominated by members of his radical-left Syriza party, among them academics, labor activists and human rights advocates.
His most closely watched selection was his new finance minister, Yanis Varoufakis, an economist and avid blogger who has described Europe’s austerity policies as “fiscal waterboarding.”
European leaders began to send their congratulations on Tuesday after a mostly chilly initial response to the victory by Syriza, which is demanding a renegotiation of the tough terms of Europe’s 240 billion euro bailout of Greece.
Chancellor Angela Merkel of Germany wished Mr. Tsipras “much strength and success,” if also noting that “you are taking office in a difficult time in which you face great responsibility.”
Mr. Tsipras quickly demonstrated that Europe must not treat Greece as a weak junior partner. His government on Tuesday denounced a European Council statement in which European leaders blamed Russia for the escalating violence in Ukraine and raised the prospect of new economic sanctions.
In its own statement, Mr. Tsipras’s office said the European statement had been issued “without the consent of Greece.” The prime minister also complained by telephone to Federica Mogherini, the European Union’s foreign policy chief.
Mr. Tsipras has been a sharp critic of European sanctions against Moscow and has displayed past good will toward Russia, a sentiment common among many Greeks.
President Vladimir V. Putin of Russia sent Mr. Tsipras a congratulatory telegram on Monday, the day he was sworn into office, while that same day, Mr. Tsipras met with the Russian ambassador in Athens.
Having a Greek prime minister with a strongly dissenting view on Russian sanctions could greatly complicate European Union foreign policy, which has benefited from a German-led unanimity among heads of state on confronting Mr. Putin.
Further sanctions cannot be approved without a unanimous vote from the leaders of European Union member nations, and Mr. Tsipras might find sympathetic partners in countries like Hungary or Slovakia, which dislike sanctions but generally go along.
Political analysts in Athens interpreted Mr. Tsipras’s early warning shots as clever political positioning, given that his government will soon open negotiations with the country’s European creditors over the punishing bailout provisions. Showing that he could complicate European goals in Ukraine may give him leverage in his economic negotiations, analysts said.In a blog post, "A question of respect (or lack thereof)… – the Greek veto over Russia that never was," Varoufakis protests that the position of the new Greek government is not one that categorically opposes a new round of economic sanctions targeting Russia, but rather one that insists on its national sovereignty:
On the first day in our ministries, the power of the media to distort hit me again. The world’s press was full of reports on how the SYRIZA government’s first foreign policy ‘move’ was to veto fresh sanctions on Russia. Now, I am not qualified to speak on foreign affairs but, nonetheless, I must share this with you at a personal level. Our Foreign Minister, Nikos Kotzias, briefed us that on his first day at the job he heard in the news bulletins that the EU had approved new sanctions on Russia unanimously. The problem was that he, and the new Greek government, were never asked! So, clearly, the issue was not whether our new government agrees or not with fresh sanctions on Russia. The issue is whether our view can be taken for granted without even being told of what it is! From my perspective, even though (let me state it again) I am certainly not qualified to speak on foreign affairs, this is all about a question of respect for our national sovereignty.Could journalists the world over try to draw this important distinction between protesting our being neglected from protesting the sanctions themselves? Or is this too complicated?Regardless of how you frame it, the point has been made. Syriza represents a huge potential impediment to business as usual.
John Helmer has a piece, "Russia's and Greece's Fraught New Relationship," on Naked Capitalism that doesn't mention the new sanctions veto and cautions against great expectations. In the recent past, Russia has viewed Greece through the lens of her oligarchs, oligarchs that Tsipras has promised to go after:
Against the plots and plans of the friends who are Greece’s enemies, there is also the experience of Greek history of the 1980s (my history, too). That shows how little the friend who is the enemy of Greece’s enemy is worth when Greece’s life and death are at stake. It is already clear that Putin, on the advice of Igor Sechin, Igor Shuvalov, and many others, has cast a strategic card on Turkey. The alternative card Greece has to offer isn’t obvious [What about a veto of another round of EU sanctions?], at least not to the Kremlin, and not yet.
So when the Americans, British, Germans, and Turks revive against Tsipras – as they are certain to do — the infowar and regime-change tactics used against Andreas Papandreou between 1982 and 1989, the Kremlin cannot be counted on to support Greece’s rebalancing of power. Twenty-six years ago, it was the Politburo’s conviction – spelled out in secret in February 1989 – that Papandreou was an American puppet who could not be relied upon. The Politburo was wrong about Andreas; it proved to be right about his son, George Papandreou (below), the fool and coward who has been dismissed in Sunday’s poll with a 2.7% vote — the first time in a century that no Papandreou is judged by Greek voters worthy to represent them in parliament.
Naked Capitalism has been consistently pessimistic (some would say realistic) about Syriza's chances to implement its agenda and roll back the neoliberal tide engulfing the planet. I remain optimistic. Granted, I have a tendency to be buoyed by any election win of a leftist party. But my optimism is fueled by the belief that the neoliberal status quo has a hit a wall. It rules by a duopoly, where both parties serve financial capital and not the overwhelming mass of voters, whose prescription, quantitative easing, to deal with the low growth and high unemployment endemic in the West doesn't work to solve those problems but works wonderfully to funnel more wealth to the super-rich.The NATO script of the 1980s can already be read in the tweeting of the enemy press in London, Berlin, and Washington. Tsipras is unlikely to rely on public relations agents or on the ambassadors of his foreign ministry to fight back. More fundamental Greek tactics are being devised, including those which are still not revealed from the 1980s. It will take more than ceremonies at Greece’s cemeteries to remember the victims of German war crimes and Turkish genocide. The modern Δροσουλίτες (Droussolites) have much to remind, but not in public.The Greek agenda for the Kremlin is already obvious – resumption of the food trade; rouble tourism; Cyprus; a new gas hub for southern Europe; NATO in Ukraine and the Balkans. For these negotiations it is also clear that Russian oligarchs and Gazprom fixers, and their Greek counterparts, who have dominated the relationship with Athens in recent years, are unacceptable to Tsipras. Officials like Sechin, Shuvalov, and the circle around Prime Minister Dmitry Medvedev also showed themselves in their Orlov colours during the negotiations for the Cyprus bailout loan of 2013. By Athens they can be ignored.
Such a failed system can't be expected to operate unchecked indefinitely. To attempt keep it up and running is going to require extraordinary measures, such as the Koch brothers budgeting $900 million to elect Scott Walker POTUS. In the last few years in countries with a tradition of military coups (Egypt, Thailand) we have seen a return of the totalitarian police state with little protest from USG.
If one was wondering how Obama, who has consistently prodded Europe to pursue stimulus to rouse its ailing economy, would greet the new leftist government of Greece, wonder no more. Liz Alderman reports in "Tsipras’s Debt Plan Sends Athens Stock Market Sliding" that
The White House confirmed that Mr. Tsipras spoke by telephone on Wednesday with President Obama, who has generally been critical of Europe's austerity approach and supportive of more growth-oriented policies. But Mr. Obama has also recognized the need for structural reforms to accompany growth policies.
The White House would describe the telephone conversation only in general terms. But a spokesman made clear that Mr. Obama favored a balanced strategy.
“The United States looks forward to working closely with the new Greek government to build on recent structural reforms, which lay the groundwork for economic recovery,” Mark Stroh, a White House spokesman, said in a written statement. “We will also continue to discuss ways to boost demand and job creation with our European partners to help foster an environment that supports reforms in Greece and elsewhere in Europe.”The structural reforms that Obama is alluding to are the social spending cuts, union busting and privatization, a.k.a., neoliberalism, the rejection of which gave Syriza its resounding victory at the polls on Sunday.
The fact that the market has responded so adversely -- "The Athens Stock Exchange, where billions of euros in value were wiped out during Greece’s election campaign, fell 9.2 percent on Wednesday after slumping around 11 percent on Tuesday. Shares in banks in Greece plummeted nearly 27 percent on Wednesday." -- is a good sign. It means that the money boys think Tsipras can deliver on his promises.
Proof of that, and an indication that Syriza is not going to kowtow to Obama administration calls for more "structural reforms," comes at the end of Alderman's story. She also provides a neat encapsulation of conventional neoliberal wisdom as voiced by a London banker:
Still, the sell-off, while drastic, was not far out of line with the kind of volatility that has characterized the Athens financial markets since the onset of the country’s crisis in 2010. Indeed, investors now tend to treat Greece more like a developing country than a member of the developed world. That volatility could die down as quickly as it arose should a suitable solution be found.
The most likely outcome, according to Holger Schmieding, chief economist at Berenberg Bank in London, is that “facing reality, Prime Minister Tsipras will eventually get real.”
“A patient Europe will offer face-saving compromises,” he said.
Still, Mr. Schmieding said in a research note, that in the meantime there could “be a rough ride for Greece.” And he warned that the odds of an “accidental” Greek exit from the eurozone, at 35 percent, were not insignificant.
Adding to the uncertainty was a report that Mr. Tsipras had basically frozen Greece’s privatization program, which had been a central demand of creditors in approving the country’s international bailouts. The troika had expected Greece to raise tens of billions of euros to pay its debts by privatizing state assets.
But the country’s new energy minister, Panagiotis Lafazanis, told Greek television that the government was immediately halting plans to privatize a public power company. It was also delaying the sale of a portion of Piraeus Port, one of the most strategically placed in the Mediterranean, to the Chinese state-owned company Cosco, which already owns half of Piraeus and had recently signed an agreement to start expanding cargo capacity on the other half of the port.
Mr. Tsipras said he was well aware of the high expectations for him in Greece, and the heavy responsibility his government shouldered. He suggested that the rousing messages of support he had received from leaders in numerous countries, from Russia to France to Spain, signaled that compromise was possible.
“The country is lifting up its head, assuming global significance, attracting international interest,” he added. “Greece is regaining its self-confidence and building alliances that will allow it to set its own agenda at the European table.”
“We have no time to delay,” he added. “There is no room for mistakes.”Tsipras has impressed me. He sees his project larger than just Greece. This bodes ill for business as usual within the European Union.
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