Originally published on the Navigator Consulting Group website on 6 July 2015
As expected, Greek voters backed the “No” in the Referendum held on Sunday, 5 July. This article reviews how this Referendum occurred and reflects on the misconceptions that underlie it.
The official question asked by the Greek Referendum was the following:
Should the draft agreement proposed by the European Commission, the European Central Bank and the International Monetary Fund at the Eurogroup of 25.06.2015, which comprises two parts forming one unified proposal, be accepted:
The first document is titled “Reforms for the Completion of the Current Program and Beyond” (Greek translation) and the second “Preliminary Debt Sustainability Analysis” (Greek translation)
As many commentators have observed, there are numerous problems with this question:
- The Greek Constitution explicitly forbids questions of public finance to be voted on in a referendum. Moreover, the Referendum is supposed to address laws in Greece that have already been voted. I’ve added the Greek text at the end of this article with a link to Article 44 on the Hellenic Parliament’s website. (see the text in bold in Clause 2).
- The final text of the Troika’s proposal for Greece was released on June 26th and can be found here. This was released after the Greek side unilaterally left the talks by declaring a Referendum in the early morning June 26th. The June 26th proposal was rescinded by the Troika following Greece’s cancellation of the negotiations and the expiration of the June 30th deadline.
- It is doubtful whether more than 2% of the Greek population are competent to understand the implications of either policy document or the history that led up to them. This is not a reflection on the Greek people: any country would have difficulty deciphering the policy arcana in either document.
But the main problems with the Greek Referendum occurred with how it was interpreted by the governing party under Prime Minister Tsipras, who deliberately re-cast the debate to suggest that the Referendum was an act of resistance against European creditors who were intent on “blackmailing”, “subjugating”, “pillaging” and “terrorising” Greece.
Here are some samples of statements made by Prime Minister Tsipras in speeches:
Today are we celebrating and singing. We are celebrating and singing, overcoming fear, overcoming blackmail. ... The Europe that we knew, the Europe that stands for its founding values, doesn’t involve blackmail and ultimatums.
Yesterday they were blackmailing us with liquidity, today they are blackmailing us with the banks, fear, panic and scaremongering. Eventually, however, even blackmail attempts fail. I would like to remind you today of a great phrase by a politician from the New Deal era in the United States who had stated that “The only thing we have to fear is fear itself.” The only thing that the Greek people have to fear today, after so many years of being pillaged, is fear itself. And I bring this up because already an incredible propaganda campaign of fear was launched–just last night–that will only escalate in the coming days, as Sunday approaches.
Anyone observing these (and many other) speeches could only wonder at the deliberate attempt to distract attention from the true question expressed in the Referendum, with the incendiary rhetoric employed by Alexis Tsipras, Zoi Konstantopoulou (who said that anyone voting “yes” was the agent of a foreign government), or Yanis Varoufakis.
This is particularly interesting given that:
- The final Greek proposals made on Thursday, 25 June are extremely similar to the final Troika proposals of Friday, 26 June.
- Prime Minister Tsipras sent a last-minute letter on June 30th accepting most of the points in the June 26th offer. This is the same offer that he condemned as blackmail in his speech to Greek Parliament on June 28th.
- The SYRIZA-ANEL government had already been “negotiating” for 5 months and was thus perfectly aware that establishing deadlines is hardly a form of “ultimatums” or “blackmail”, given that Greece’s financial situation was deteriorating rapidly. Indeed, the definition of a “humanitarian crisis” as espoused by Yanis Varoufakis is that it must be solved quickly.
- The quality of policy documents proposed by Yanis Varoufakis and the Greek negotiating team in the first four months was abysmal in their lack of detail and quantification.
So why did Greek voters vote “no”? Four reasons:
- They accepted the premise that the referendum was a vote against blackmail (despite that fact that it was their elected parliaments who signed up to austerity). Thus, saying “no” to the creditors became associated with an act of patriotic resistance.
- They accepted the premise that “No” meant no more austerity. This is confirmed in hundreds of televised and print interviews that have been published since June 26th.
- They have accepted SYRIZA’s assurances at face value that a “No” strengthens the Greek negotiating team to sign a better deal, against all evidence to the contrary.
- They have sufferent incredibly under five years of highly questionable economic policies implemented by successive Greek governments, with the inspiration and consent of the Troika.
Knowing these facts, any observer then needs to ask why this Referendum was held. After all:
- There is very little difference between the austerity policies proposed by SYRIZA on June 25thand the austerity policies proposed by the Troika on June 26th.
- Prime Minister Tsipras accepted most of the creditor demands on June 30th. So he has accepted the same "pillaging" he condemns in his speeches.
- Prime Minister Tsipras and Yanis Varoufakis are on record stating that a “no” vote will strengthen their negotiating hand, meaning they are going back to negotiate another loan agreement.
- Any such negotiation will lead to greater austerity, since no one is willing to lend money to Greece without conditionality. Moreover, the Greek financial situation has deteriorated significantly since capital controls were introduced, and in general since SYRIZA took power on January 26th.
- Most Greek voters are unable to state which specific policy proposals they disagree with, or what the alternative should be.
After watching this process, we can only conclude that rather than providing information about the real choice affecting Greek voters and acting as a neutral arbiter, the SYRIZA-ANEL government deliberately chose the path of misinformation, polarisation, fear-mongering and popular resistance to gain a “no” result. This was apparently done for political survival, as one SYRIZA minister stated, and to increase their own sense of control over political events in Greece.
This is regrettable, given that in parallel, SYRIZA has done everything it can to wreck the Greek economy by cancelling much-needed private investments; has introduced capital controls due to the rational depositor fear SYRIZA's own tactics have introduced; has expanded the public sector, creating yet higher demands for tax revenue on a country in economic depression; and in general done nothing to promote or develop the real economy of Greece.
It is equally regrettable just how many Greek expatriates and media outlets have fully accepted the SYRIZA-ANEL arguments, never bothering to fact-check the actual situation, or to understand the precise reasons why Greece is in its current situation.
The SYRIZA-ANEL tactics have not taken place in a vacuum. Their statements and actions are matters of public record. Successive European heads of state have warned that they have neither the desire nor the obligation to continue to fund Greece’s debt or its deficit. This is, after all, their democratic right, and indeed their democratic obligation not to put their own taxpayer funds at risk.
This is not to say that the European creditors share no blame for this situation. They do. But the primary responsibility today rests with the current Greek government.
The questions facing Greece this morning are therefore:
1. How does SYRIZA propose to negotiate a new loan with “blackmailers”, “terrorists” and “pillagers”?
2. Assuming the statement that “the No vote will strengthen our negotiating hand” and that “an agreement will be signed within 48 hours” are true, how does SYRIZA intend to explain to the Greek people that any new loan agreement requires even greater austerity?
Rather than being a victory for democracy and for Europe, as Yanis Varoufakis claims, this Referendum will likely be seen as the moment when the Greek government, in the absence of any specific economic planning, risk analysis, or contingency planning, adapted a non-democratic process to further their own political ends. Or, as one analyst put it, "signed their own suicide note".
Yanis Varoufakis’ resignation this morning, while merited, is only the latest mark of desperation by a government that has neither a plan to save Greece nor the competencies to develop or implement one.
© Philip Ammerman, 2015
4 July 2015
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21 January 2015
'Αρθρο 44: (Πράξεις νομοθετικού περιεχομένου, δημοψηφίσματα, διαγγέλματα)
1. Σε έκτακτες περιπτώσεις εξαιρετικά επείγουσας και απρόβλεπτης ανάγκης ο Πρόεδρος της Δημοκρατίας μπορεί, ύστερα από πρόταση του Yπουργικού Συμβουλίου, να εκδίδει πράξεις νομοθετικού περιεχομένου. Oι πράξεις αυτές υποβάλλονται στη Bουλή για κύρωση σύμφωνα με τις διατάξεις του άρθρου 72 παράγραφος 1, μέσα σε σαράντα ημέρες από την έκδοσή τους ή μέσα σε σαράντα ημέρες από τη σύγκληση της Bουλής σε σύνοδο. Aν δεν υποβληθούν στη Bουλή μέσα στις προαναφερόμενες προθεσμίες ή αν δεν εγκριθούν από αυτή μέσα σε τρεις μήνες από την υποβολή τους, παύουν να ισχύουν στο εξής.
*2. O Πρόεδρος της Δημοκρατίας προκηρύσσει με διάταγμα δημοψήφισμα για κρίσιμα εθνικά θέματα, ύστερα από απόφαση της απόλυτης πλειοψηφίας του όλου αριθμού των βουλευτών, που λαμβάνεται με πρόταση του Yπουργικού Συμβουλίου.
Δημοψήφισμα προκηρύσσεται από τον Πρόεδρο της Δημοκρατίας με διάταγμα και για ψηφισμένα νομοσχέδια που ρυθμίζουν σοβαρό κοινωνικό ζήτημα, εκτός από τα δημοσιονομικά, εφόσον αυτό αποφασιστεί από τα τρία πέμπτα του συνόλου των βουλευτών, ύστερα από πρόταση των δύο πέμπτων του συνόλου και όπως ορίζουν ο Kανονισμός της Bουλής και νόμος για την εφαρμογή της παραγράφου αυτής. Δεν εισάγονται κατά την ίδια περίοδο της Bουλής περισσότερες από δύο προτάσεις δημοψηφίσματος για νομοσχέδιο.
Aν νομοσχέδιο υπερψηφιστεί, η προθεσμία του άρθρου 42 παράγραφος 1 αρχίζει από τη διεξαγωγή του δημοψηφίσματος.
*3. O Πρόεδρος της Δημοκρατίας σε εντελώς εξαιρετικές περιστάσεις μπορεί να απευθύνει προς το Λαό διαγγέλματα, μετά από σύμφωνη γνώμη του Προέδρου της Kυβέρνησης. Tα διαγγέλματα προσυπογράφονται από τον Πρωθυπουργό και δημοσιεύονται στην Eφημερίδα της Kυβερνήσεως.
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