Syriza has now sealed a coalition deal with the Independent Greeks Party. “In terms of social issues, foreign affairs, civil liberties, we are chalk and cheese,” Yanis Varoufakis (tipped as Finance Minister) but the extra 13 MPs should give Tzipras enough leeway to cope with rebels within his own party. It seems as though the agreement is fundamentally `not to undermine’, rather than wholehearted co-operation.
The next period will certainly be tumultuous but the media focus on additional spending should take account of the policy statement about resolving issues with Turkey, thus enabling substantial defence cuts. That would free up substantial sums for re-allocation. Raising tax on large companies, and health spending, to “European averages” can hardly be seen as excessive.
Without a doubt, the success or failure of this bold move by the Greek electorate will be determined by the willingness to deal with the `clientelism’ of the public administration and to “stand up to the tax-evading economic oligarchy”. That could provide additional tax revenues to launch a “social market economy” – clearly echoing the Ludwig Erhard programme of the 1950’s that pulled Germany out of the post-War ashes.
© Graham Bishop
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