Syriza — Strategy or Weakness?

Despite some appearances to the contrary, I remain hopeful that Syriza will hold firm in its resistance to austerity. It may be that the Greek government is positioning itself so that, in the event of exit, it is seen to have been forced off the euro rather than to have willingly opted out. In the event of exit, it could make a significant difference to the response of others (such as the US, the IMF, not to mention the Greek people themselves) that Syriza is seen to have been pushed into a corner, left with no choice, rather than to have been enthusiastic in any break away from the common currency.

For these reasons, it seems plausible to me that Syriza’s recent statements and actions could all be part of an effective strategy. But, equally, I can understand the fears of others that the Greek government in fact may have no effective strategy or that it may be so wedded to the idea of the common currency that ultimately it will end up folding, preferring to inflict further destructive austerity on the Greek people than to go off the euro.

If Syriza stands firm, Greece ultimately will benefit in my view, whether through forced exit or the gaining of significant concessions within the common currency arrangement. But will Syriza stand firm? If Syriza does happen to be pursuing good strategy, it may well be difficult to distinguish from weakness at this point. Difficult because appearing weak could be strategic or simply weakness.

I am not confident that it is the former, by any means, but simply think that we may need to see how the dust settles before evaluating the effectiveness or otherwise of Syriza’s approach to what is obviously a difficult situation.

5 thoughts on “Syriza — Strategy or Weakness?

  1. Stay strong PM Syriza , I would hate to hear Kenny saying that he took his advice

  2. Bob- IMHO that is the worst thing that Varoufakis has written. Warren Mosler has a critique of it here: Mosler trolling Varoufakis with damn good arguments.

    But otherwise I think it appears that Varoufakis had been on the side of not giving in in internal policy debates. His general strategy as Peter outlines above is and was quite sound. Michael Hudson (his counterpunch on the Delphi Declaration) considers it a success, but that many do not understand that. The problem is sticking to it now, when what YV had forecast as the most likely outcome – (>50%) – complete intransigence by the Eurocrats – is occurring. Staying on course now, resisting austerity even unto Grexit, as YV repeatedly said Greece would, contrary to many careless readings, is the tough part.

    Aside from the above & Flassbeck & Lapavitsas, IMHO the analyses of Grexit and related issues most worth considering are (unfortunately telegraphic) in papers at the Levy institute, by C. J. Polychroniou & by Papadimitriou, Nikiforos & Zezza using the Levy Institute Model for Greece (LIMG). There might be short term costs of Grexit for 6-24 months & not much reason to hope for great help from exports but contrary to YV above, that wasn’t what got Argentina out of its mess either.

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