David Blanchflower a left leaning economist and one of the keenest critics of austerity writes of Greece:
“There has been no reform to speak of. Greece is characterised by endemic tax evasion, a poor tax collection infrastructure, parochial patronage policies, corruption and huge delays in the administrative courts dealing with tax disputes. Greece also has deep structural problems, mostly in product markets with oligopolies in almost every industry, closed professions, administrative and bureaucratic impediments to entrepreneurship alongside barriers to trade and exporting, none of which have been addressed.”
Blanchflower’s exasperation is echoed by the Greek commentator Harry Theoharis, who complains
“These (reforms should) include market liberalisation, business environment simplification, an expanded and better targeted social welfare system, a truly meritocratic public administration, privatisation in sectors dominated by inefficient state monopolies, and pension reform.
As a result of the government’s lack of concrete reform proposals and general intransigence, the creditors have reverted to requesting ambitious fiscal targets and further horizontal austerity measures (ie VAT hikes) that are easily monitored in order to justify further aid to their parliaments, while the structural reforms are pushed back again.”
In this moment of epic importance for the future of Greece the radicals of Syriza propose to change almost nothing, no radicalisation except in rhetoric. Words can change but the facts on the ground may not.
Now this is the inverse of what was to be expected. Surely Syrizia would refuse austerity at all costs and push through deep reform in a complete rupture with the failed politics and economics which drove Greece to the edge of catastrophe? Pasok and New Democracy did not do reform as their entire politics was based on clientelism and patronage and abuse of the public sector. Any reform could not be countenanced by these two because this would undermine the means, and defeat the ends of their politics. Enter Syrizia elected on a promise to destroy this old world, a world which they had no difficulty in describing as deeply enervating and corrupt, so scroll forward to the “make or break” negotiations and look at the Syrizia reform structural reform offer. There is no reform offer.
So why after promising to change everything do the radicals decline to change anythung? Let’s allow them hostility to reforms which deepen social injustice and cut pensions but where is the proposals to end the cartels, break up the oligopolistic sectors of the economy, make the rich pay their taxes, remove the incompetent Pasok and New Democracy supporters form the public administration and replace them on merit. End the corruption, organised criminality, make the tax system work? As Theoharis points out they don’t even have the excuse of being faced by a populist and delusional opposition.
Readers of this blog will not be astonished if at this point a faulty and misfiring moral intuition is adduced as the culprit, and not for the first time in the endless crisis. Recall the German Finance Minister Schauble regarding debt as a form of moral turpitude as it potentially could have been in the Neolithic which did not have the benefit of capitalist free markets that he actually admires, and the Greek Finance Minister Yanis Varoufakis thinks he is in the late Palaeolithic in imaging that wealth is produced collectively but privately purloined.
Fiskian Social Relations misapplied illuminate the errors, applying the wrong social relations, and in the case of Schauble and Varoufakis both using CS as the social relations reference rather than MP, and because these structures can appear like moral truths or equally, moral offences, they both hold their views with a powerful sense of righteousness.
In the present case of Syriza and reform (note that they even want to undo past reforms never mind block new ones) and do so because of moralised hostility to that whole group of social relations which comes under MP. Although it is called Market Pricing a better name for this group of social relations would be Contract, as it includes non-commercial and non-market based contracts such as the criminal law and the relation of the governed to governors. Anyways, Syriza don’t like this one, they don’t like social relations based on contracts and prefer those of communal sharing CS or equality matching EM (citizenship, rights, responsibilities). Moralised anti MP leads them to oppose reform because existing relations are forms of contract which it pains them to even consider. Contract reform which is what all reform is, requires acknowledgement of the contract and analysis of the terms. Syriza loathes this type of contemplation and cannot as a consequence do the single most important thing required by Greece in this crisis. In the absence of this reform the Institutions demand greater austerity in compensation but even this cannot make Syriza think about reform.
You can destroy Greece through clientelism and patronage by regarding public goods and the public sector as something to be shared communally (i.e. in CS), or by failing to challenge that through moralised hostility to MP (Contract) based social relations.
Austerity and reform are both sins, you see.