Thursday, 3 November 2011

That referendum

Despite the bullying from the rest of the euro zone leaders George Papandreou the Greek Prime Minister is right to hold a referendum on the Euro zone rescue package.

The Greeks have done us all a favour. They’ve reminded politicians throughout the world of two things, the first is that you can’t divorce economics from politics and secondly, in a democracy, economic policy can only happen with the consent of the people.

There is a limit to the amount of austerity a people will stand and when that breaking point comes governments become very vulnerable. It may be that a referendum is the only way the Greek government can gain any legitimacy for continuing with their restructuring of the Greek economy.

Unless ordinary people feel that they’ve had an input into the process then the only alternative they have is to take their protests on to the streets.

The Greeks have introduced a note of political reality that Cameron, Merkel and Sarkozy would do well to learn from. They should hector less and understand more.

International conferences are great for the ego of politicians and reality usually stay’s outside the security cordon. But leaders would do well to remember that financial deals to solve crisis should not ignore completely those that’ll suffer as a consequence of such deals.

Citizens matter. They are the ones that suffer from the austerity measures. They are the ones that lose their jobs.  It is their pensions and other benefits that are cut.  All these things hurt.

Now most voters will put up with pain if they see the burden being shared. But as so ably amplified by the world wide anti-capitalist protests many feel that the burden is not been shared. As the Occupy Wall street protesters claim 99 per cent lose out while 1 per cent are given unfair advantage.

A statistic echoed, yesterday, by Ed Miliband and also motivated Dr Rowan Williams, the Archbishop of Canterbury to call for a Robin Hood tax on financial transactions.
So the G20 and the G8 summit meeting would do well to remember that unless fairness to the 99 per cent is part of the final solution the summit will have failed.

So a vote of thanks to the Greeks, for reminding world leaders that the great unwashed have a stake in the solutions agreed behind those closed conference doors at Cannes.

Post Script
It looks attempts are being made to bully the Greek government out of holding that referendum. The arguments above, however, are still valid. Austerity without consent; result, chaos.


  1. If you needed clearer evidence that the 'deal' done in Brussels last week was about saving the banks not Greece and the Eurozone you just had to look at the reaction to the news of the Greek PM's supposed resignation earlier today when World Stock Markets rallied significantly.

    More worrying watching Paul Mason's interesting piece on Newsnight last night about the similarities between the crash now and in the 1930's and all the ingredients are there now as back them for a full on world wide depression if growth can't be generated.

  2. Events in Greece remind me so much of events in Wales.

    The prevailing ruling body has promised too much in order to secure election. Money is lavished on the population which, over time becomes fat, lazy and more demanding. More money is spent, but even more is demanded.

    The money eventually runs out. Everyone but the true culprits are blamed. Austerity will not be tolerated in this modern world!