Exclusive Interview: Meet Alexis Tsipras, the Most Dangerous Man in Europe
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LP: You’ve suggested that debt repayment must be tied to economic growth. Why is this important?
AT: There is nothing more self-evident than this. Look at the experience of Central and Latin America. A massive debt overhang is bound to choke growth prospects when the first priority is to repay an unsustainable debt by means of increasing (growth-destroying) austerity. As debt-induced austerity gets deeper and more vicious, the recession deepens and the debt rises in real terms. Default becomes certain and, while it is postponed through new loans and new debt, no one invests in the country, therefore reinforcing this vicious cycle.
If our creditors want their money back, they have to give us a chance to reverse our recession and to return to the levels of growth that are necessary to avoid a hard default. The United States thought that this was sine qua non in 1953 regarding Germany’s efforts to begin reconstructing its economy. The United States, for this reason, leaned heavily on its European allies to agree to a massive haircut of Germany’s debts. The conference that agreed to that haircut was the springboard that allowed Germany to bounce back and to become a dominant economy. We mention this because it is the only solution to the problem of debt which does not spell a wholesale social disaster.
LP: Should Greece stay in the Eurozone?
AT: Yes, because an exit from the Eurozone will not benefit Greece. Moreover, a Greek exit will be disastrous for the Eurozone itself, something that everyone knows deep down. It is not our intention to enter into a competitive devaluation contest with other European nations. It makes sense to change Europe’s institutions, to steer them away from their neoliberal agenda, from their fixations and the "logic" which brought the crisis about in the first place, and which now are perpetuating it.
Today we Europeans have a greater need than ever for a new narrative about Europe. We desperately need a new European vision that inspires and energizes. We want to rediscover the origins of the Enlightenment and of political democracy. We need to create -- and this is Syriza’s project -- an alternative, realistic political agenda for tomorrow’s democratic, social, environmentally sensible Europe. We know that such an agenda will bring us into conflict with powerful vested interests that will reliably spill over into the realm of political conflict and social struggles. Nevertheless, at a time when Europe is sinking into the crisis’ mire, this is the only escape route available to its peoples.
LP: What lessons should Americans take from the Greek crisis?
AT: The European Union is utilizing the crisis in order to rewrite the political history of Europe. The post-war design of Europe’s economies is under revision. The celebrated "European social model" which, until recently supposedly differentiated Europe from the United States, is unravelling. At the same time, Europe is not moving in the direction of America; it is, rather, moving in the wrong direction altogether. The United States, with its federal unemployment benefit system, its Medicaid and Medicare provisions, possesses checks and balances that the Eurozone does not have. And as the nation-states of Europe are being hollowed out by austerity-driven policies, while European institutions are not stepping in to make up for the lost social, welfare and rebalancing services, today’s United States is closer to the famed European social model than Europe is!
So, the most important lesson for the United States from the Greek crisis is that it is suicidal to try to deal with the federal debt by means of an austerity which attacks federal programs, such as Social Security, whose purpose is to shield America’s social economy from both recession and internal imbalances. Basic incomes, public health provisions, public education, social cohesion, environmental protection – these are the public goods that, if depleted in the context of fiscal consolidation, will bite your people back, and in the end, jeopardize not only America’s shared prosperity but also its capacity to repay its debts. It is for this utterly pragmatic reason that we must defend our public goods, both in Europe and in America.