Greeks Protest Austerity, But Is Leaving the Eurozone Their Only Option?

[Jefferson23]

University of Greenwich's Ozlem Onaran argues that the government should create its own currency and fall out of love with the eurozone - July 17, 2015

Bio

Ozlem Onaran is Professor of Economics at the University of Greenwich in the U.K. She regularly publishes research studies on globalization, income distribution, and business investment in publications such as the Cambridge Journal of Economics and Labour. She recently co-authored a major study for the International Labour Organization on the relative importance of decent wages versus high profits as an engine of economic growth in several countries throughout the world.

Transcript

Greeks Protest Austerity, But Is Leaving the Eurozone Their Only Option?JESSICA DESVARIEUX, PRODUCER, TRNN: Welcome to the Real News Network. I'm Jessica Desvarieux in Baltimore.

On Wednesday evening, Greek MPs passed tough austerity reforms as part of a Eurozone bailout deal. Thousands of Greek people hit the streets to protest the 229-64 vote. Here to help us understand these developments and put them in perspective is our guest Ozlem Onaran. She is a member of the Debt Truth Committee on public debt in Greece and a professor of workforce and economic development policy at the University of Greenwich.

Thank you so much for joining us, Ozlem.

OZLEM ONARAN, PROF. OF WORKFORCE AND ECONOMIC DEVELOPMENT POLICY, UNIV. OF GREENWICH: Thank you for having me.

DESVARIEUX: So Ozlem, do you see what happened on Wednesday as a teaching moment for the people of Greece? And if so, what are they supposed to learn?

ONARAN: Well, the people of Greece put their trust in Syriza and they gave them a mandate to do two things: negotiate a deal to put an end to austerity to bring back growth and jobs, while still keeping Greece in the Eurozone and the European Union.

Now, what we have learned in the last five months is that the ruling elite of the European Union, in particular in countries such as Germany, to some extent also in Netherlands, in Finland, and some of the Eastern European countries such as Slovakia or Lithuania, Estonia, are not ready to give any concessions to the negotiating team of the Greek government precisely because it's a left-wing government. It's threatening the hegemony of neoliberalism in Europe. If they were to make concessions it would surely be the beginning of the end of neoliberalism in Europe. It would trigger an immense domino effect in the rest of Europe, in Spain, in France, instantly. In Britain. It would give hope to the left all over Europe, including the left in Germany itself, so they simply could not tolerate that. It would be also an admission on their part that their policies, austerity policies, have failed.

So they took an extremely tough stance. They waged an unforeseen financial coup against the Greek society and the Greek government. And this has been a learning process for the negotiation team of Greece itself, of the Syriza government itself. But I think most importantly it has been an incredible learning process for the social movement, trade union movement, and also the ordinary people who have voted first for Syriza, and then massively for a no vote on the 5th of July in Greece.

So now they see, they have tried it all if they want to end austerity, if they want recovery, if they want reconstruction in Greece. And even when they want to end [tax evasion], to end the power of the oligarchs and to bring back tax justice in Greece, they have to also do it via a much more dramatic rupture with the policies of the European Union which may mean, as we see today, that they will have to exit from the Eurozone.

And if they decide that, they should do it on their own terms rather than waiting to be, of course, expelled by the conservative, extreme conservative governments of the Eurozone.

DESVARIEUX: Hold on, one moment. I want to get to this alternative. Because you said the Greek people, as we know, they've been polled. They say that they do not want to leave the Eurozone. But now with this development, minds could be changing. Do you think that there could be an alternative? And let's talk about this alternative. What exactly would it look like?

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[BillZBubb]

1. Greece should have left the Eurozone long ago.

They foolishly got on the treadmill of debt, austerity, more debt, more austerity...

The only way to break free is to leave the Euro behind. This new round of austerity will only make matters much worse. Sadly, there is no political leadership in Greece to do this. Syriza was the only hope but in the end they sold the Greek people out.

[potone]

3. Yes they should have, as some argued when the crisis blew up in 2010.

But to do it now, while banks are closed and without advance planning, would have been an even worse disaster. I watched the entire debate and vote in the Greek Parliament (I know, I know, you're thinking that I must be a masochist), and it was agonizing to watch. No one was happy, to put it mildly, but this at least gives them time to plan for a "Grexit" if that is indeed what needs to happen. They really had no choice but to vote for this program; Tsipras gambled and lost.

[PoliticAverse]

2. They just need to find someone to give them $80 billion or so with no 'austerity' strings attached.