The Greek Tragedy

Casting an eye over events in Greece I’m grateful that the UK has avoided a similar fate. I don’t want to imply that UK and Greek circumstances are equivalent to each other, that the UK is or was ever close to defaulting on our sovereign debt, however, there are some parallels – and some differences – that are worth exploring.

Greece went to elections on May 6 2012 and without an outright election winner, talks are still ongoing to form a Government over a week later. This isn’t so unlike how the 2010 election unfolded in the UK. The electorate did not deliver a large enough majority to any single party which forced days of negotiation. Unlike the UK though, the parties to coalition talks in Greece appear unwilling to agree a deal anytime soon. At least one party has set out its ‘red lines’ as being against any further austerity measures or cuts whatsoever.

At the moment it seems most likely that Greece will return to the polls again for a costly second election. This will do little to steady the nerves of ‘the markets’, with some observers contemplating that Greece may well leave the Euro, and that if/when that happens other countries will follow close behind and head for the exit from the Eurozone.

If Greece does go to a second round of elections this will not necessarily imply that Conservative and Lib Dem politicians in the UK made the ‘wrong choice’. It could be taken to mean that the parties and politicians active in Greece are more inflexible in their policies and ideologies. Which may be no good thing.

Some may consider ideological inflexibility a indication of weakness, or indecision. Such people – of all political stripes – will point to changes in government or party policy and stick them with labels like ‘U-Turn’. But is not some compromise, and changing political priorities on the basis of discussion, new evidence or the weight of public opinion a sign of strength? It’s the anti-thesis of the style of some politicians who seem to think that as long as they are acting upon an ‘honestly held belief’ it’s OK to ignore economic reality.

Sure, there may well be times when compromise is unacceptable – human rights issues spring to mind here. But when faced with one of the greatest economic crises in generations, would it not be a positive thing if Greek politicians could reach a compromise and devise a plan to get through the current situation?

Having a second election in Greece may well be a good thing if it produces a democratic and decisive winner who can then take forward their policies with the unqualified backing of the electorate. But there is no guarantee that will happen. In the meantime the economic situation in Greece is hardly improving.

Greece adopted the Euro and is now subject to the terms of the financial bailout agreed with other Eurozone countries. Debate is raging as to if Greece will eventually default on it’s debt and leave the Euro. The election results show how divided public opinion in Greece is on this issue, with the growth in the far-right vote a particular worry.

One would hope that if there is a second election held that mainstream Greek parties will win back a large proportion of protest votes, or those disillusioned with politics in general who sat out the first round. Rarely does one get a chance to cast a vote againafter knowing the results of such a critical election. It would indeed be a gift for those who bemoan that political parties are “all the same”. The spectrum of political options available to Greek voters is wide – pro-austerity or not? In or out of the Euro? – and the opportunity to make such a direct difference in the way their country is administered is there for the taking.

An option apparently being championed by the Greek President is the appointment of unelected ‘technocrats’ to form an interim Government. I would not want this for myself, and so I cannot wish this fate on the Greeks.

If Greece leaves the Euro there will be plenty of pundits popping up to say ‘I told you so’ and gleefully trumpeting the end of the Euro as if this will actually happen or, if it did, would have no discernible effect on our own economy. In or out of the Euro, the rest of Europe will still be obliged to support Greece. In a globalised economy, switching to a different currency does not suddenly solve a sovereign debt problem.

Whatever happens, the political fallout will reverberate around Europe for decades.

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