A leftist victory in Greece, and anti-austerity pushback across Europe. We’ll ask where this goes.
A big vote in Greece this weekend, with a big message for banks, lenders, and the champions of austerity. The new Greek prime minister and his party say no, we won’t bite the bullet anymore. We won’t take the pain of cutting back and cleaning up our credit. We’re done. But here’s the thing: the lending nations of Europe – Germany at the fore – don’t want to hear it. Even as austerity has crippled economies in Greece and beyond. Many strands of anger are growing in Europe. They challenge Europe and, maybe, the global financial system. This hour On Point: the Greek cry, and what it means.
— Tom Ashbrook
Christoper Pissarides, professor of economics at the London School of Economics. 2010 Economics Nobel Prize winner.
Scheherazade Rehman, professor of international finance and business and international affairs at George Washington University, where she is also director of the European Union Research Center. (@prof_rehman)
From Tom’s Reading List
The Guardian: Syriza’s Tsipras sworn in after Greek government formed with rightwingers — “A new chapter in Greece’s uphill struggle to remain solvent – and in the eurozone – has begun in earnest as anti-austerity politicians assumed the helm of government following the radical left Syriza party’s spectacular electoral victory on Sunday night. Ushering in the new era, Alexis Tsipras was not sworn in, as tradition dictates, in the presence of Archbishop Iernonymos but instead took the oath of office in a civil ceremony. At 40, he becomes the country’s youngest premier in modern times.”
The Wall Street Journal: Greece Must Repay Debt, Europe Officials Say — “In the hours after its first-place finish, Syriza signaled it would stick to it strong antiausterity approach, agreeing to form a coalition with the Independent Greeks, a small right-wing party with which it has little in common except opposition to Europe’s current economic policy. The gulf between the incoming coalition, led by leftist firebrand Alexis Tsipras, and the country’s European creditors is so wide that some policy makers see a Greek exit from the euro as a serious possibility in the coming months.”
BBC News: Syriza gives eurozone economic headache — “Syriza itself is not even talking about it but it is being discussed elsewhere in the EU. The euro is the single currency of all 19 members of the eurozone. So all disputes related to the Greek crisis must have their solutions within the framework of the euro, not outside it. If the euro system cannot solve its problems through all the mechanisms that exist, then the system itself cannot survive.