Snap elections held on January 25 in Greece brought victory to the left-wing party leader Alexis Tsipras.
His Syriza party formed a coalition with the Independent Greeks party. Both parties share the anti-austerity agenda and are supported by the majority of Greeks. However not all politicians in the EU share the optimism of the Greek electorate.
Agree or Disagree discusses the implications of the elections for Greece and the rest of the EU with Patrick Young, a financial analyst and head of DV advisors, and John Nomikos, director of the research Institute for European and American Studies.
What do you personally think of the win?
John Nomikos: I would like to say that the ingoing Prime Minister Alexis Tsipras made an outstanding victory. And what is happening is that hope prevails anger. Many people who went to vote were thinking much about what was going on in the last six years of recession, and they wanted to say that the sacrifice is having some long-term advantages. So, they wanted to see some light in the tunnel. Mr. Tsipras is going to form a small Cabinet, not more than ten ministers, compared with the last conservative Government which had more than 45. So, we are looking at a determined leader who wants to make some reforms in a short time.
Patrick Young: It is going to be an incredible challenge. This is the result that the outside world told us could never happen. He is an incredibly charismatic individual. I'm not sure I can agree with any of his economic politics, but at the same point in time it is clear why he’s come along, because Greece is in a wretched economic position. He offers hope, he offers determination and, certainly, the first 24 hours have been very-very exciting.
I would like to discuss the relations with the EU and the troika, who are the biggest international lenders of Greece at the moment. Mr. Tsipras said that the troika for Greece is the thing of the past. What consequences might this position have?
Patrick Young: The problem is: we really do have a difficulty when it comes to the economics and particularly the relationship to the EU. The old logic puzzle – what happens when you have an immovable cannonball and it hits an unbreakable post – that is exactly where we are at the moment.
Everybody really believes that the EU is going to break and the cannonball, which is Mr. Tsipras, equally, is felt that it wouldn’t break. Everything that the EU has said so far has turned out to be wrong and they’ve had to eat their words. But will they actually bend this time around, because it is really-really difficult.
The economists like to compare Ireland and Greece, and how Ireland done well with austerity. In Greece, it was a different situation, but why was it different?
John Nomikos: Never underestimate the factor of security. The point is that Greece is a gate for illegal migrants to Europe. Greece urgently needs a department of homeland security in order to coordinate intelligence sharing and working of the law enforcement and intelligence security. Why I say that? Because we are like a hub or a transition area for the jihadists and terrorists that go through Greece. Don’t forget that without security there is no development, because who is going to come here to invest in Greece if the security is not guaranteed to the people.
How prepared the European leaders are to compromise with Tsipras and renegotiate on the terms of the Greek recovery?
Patrick Young: I think it is going to be incredibly difficult, because the problem is not with Mr. Tsipras and it is not actually with Greece per se. The difficulty is the fundamentally bad construction of the Euro currency itself. And therefore, the Brussels bubble which includes the national governments overall, particularly in the Northern Europe, have got themselves into this crowd mania. They are incapable of thinking outside of the bubble. They are trying to save the overall Euro currency and at the end of all of their calculations, what they say is: well, Greece is just 2%.
I think what is very interesting is that all the way up until relatively recently, when it became clear that Mr. Tsipras was likely to win this election, the EU had always said that it is impossible to leave the Euro, no one can leave the Euro, Greece is locked into the membership at the club etc. Now, what suddenly happens is that we are getting subtle messages, saying – well, Greece could decide to leave. And the truth is that Greece has got a very long and significant history of debt defaults. And it seems to me that the inevitable is probably going to be the case that Mr. Tsipras must either bend himself double and effectively end up joining the club of the established blob politicians of the EU, or he is going to actually have to do something more akin to what he promised in his manifest when he was campaigning. And if he does that, it is going to be incredibly difficult for him to keep Greece in the Euro.
John Nomikos: The Greeks don’t want to leave the Euro, they want to be in the Eurozone. If Mr. Tsipras is going to leave nepotism and allow young scientists to fulfill the jobs that he wanted to assign to them, I can see Greece tomorrow being another country. The point is that you need to have the right people in the right jobs without nepotism, without asking for political loyalty to the party. They need to be qualified for the job they apply. If he does that, this is going to be the first time that a Prime Minister will allow the people outside his political party our any other party to fulfill the job.
If the EU and the troika are not likely to budge on the negotiations with giving more money to Greece or easing the bailout terms, and then we have this new charismatic leader who a lot of people believe in, what is going to happen here?
John Nomikos: If this charismatic Prime Minister tries to reform the bureaucracy, makes things simpler, the diaspora in the UK, in Germany, in the US, Canada, there are Greek people who want to come here to invest and help the country to get out of the recession, but they face too many problems with bureaucracy, with bribes and corruption. And one of the biggest problems besides corruption is nepotism in the Mediterranean.
