Should we fear Tsipras bearing gifts?

Beware of Greeks bearing gifts, the old saying has it. Though what Virgil actually wrote – timeo Danaos et dona ferentes – translates more closely as “I fear the Greeks even when they bear gifts.”

The Greeks brought us a gift on Sunday, and it’s certainly dangerous. Will Alexis Tsipras, the new Prime Minister, succeed in his bid to free his compatriots of the scourge of austerity while staying in the EU and even the Eurozone? Or will he throw the whole continent into instability and further crisis?

Tsipras of Syriza: bearing a gift, to be feared – or welcomed?

We simply don’t know. But one thing we learned from the weekend election is that if you create sufficient despair in a people, with a prospect only of more suffering ahead, they will ultimately vote for a change whatever the risks may be. Again and again, I’ve heard Greek voters telling journalists, “in winter, I can’t afford to heat.” 

Why would anyone put up with that indefinitely?

And it would indeed be indefinite. There’s no prospect of Greek recovery yet. The economy has shrunk by a quarter since the international financial collapse of 2008. It is growing now if you ignore the burden of debt repayment, but in the case of Greece, that’s not something you can ignore. The austerity Greeks have suffered for five years has only led to a crippling debt mountain which is beginning to fall due for payment, promising only more dreary pain ahead.

The answer proposed by the EU and the previous Greek government is more austerity. More, in other words, of precisely the same remedy that has failed so far and led to the despair so many feel. More of a remedy which we’ve known, since Keynes, isn’t going to work.

He called it the paradox of thrift. When in debt, the standard reasoning goes, you need to save money to pay off what you owe. That works fine at the level of the individual. But at the level of a nation, it’s a disaster. If we’re all spending less, the economy contracts. People lose their jobs. They stop paying taxes. Government revenues fall. Debts climb.

That’s what’s happened in Greece. It’s happened in Britain too. We’ve had five years of austerity policies. The health service is screaming in pain. Social care has been cut massively at a time when people hope it might take some of the strain off the NHS. Libraries are closing. The education service, for which the government likes to claim all sorts of success, is failing to turn out skilled labour so that the building industry isn’t able to gear up to the challenges ahead – and the housing crisis intensifies.

Meanwhile, the poor are being put to the rack like their Greek counterparts. The unemployed and sick, naturally, but even the working poor whose praises the government likes to sing: tax credits for low earners have been eliminated, assistance for young children gone, assistance from local authorities cut back as those authorities are starved of funding.

Meanwhile, as Polly Toynbee points out, at the opposite end of scale, the top 1% of earners, have done well from austerity – just like their counterparts in Greece. In the run up to the election on 7 May, the Conservative Party is explicitly promising more of the same: cuts that will take state spending down to the level of the 1930s, but £7 billion of tax cuts for the wealthiest.

So what gift have the Greeks given us? A model. An example we might care to follow. An illustration of the fact that one can say no, demand that the wealthy nations help the poorer with a more open hand, and that even within a nation, the rich can shoulder more of the burden to free the poor from some of the suffering.

But we’re told to fear the Greeks with their gifts. Certainly, there’s no guarantee Tsipras will be able to pull off his trick. And if the move to question the received wisdom of the self-serving Right is limited to the south of the continent – perhaps Spain and Portugal alongside Greece – while the wealthier North holds firm, there’s little likelihood that the movement will lead on to success.

But if the rest of us also learn to say no, and if we find leaders prepared to say no with us, the election of Tsipras may turn into a turning point that can transform our lives throughout Europe.

In which case we should all welcome the gifts the Greeks are bearing. Even if they are a little fearsome.