Tsipras Throws Greece off a Cliff

By Tom Rogan
Monday, June 29, 2015

    Is this a dagger which I see before me, the handle toward my hand? Come, let me clutch thee.

That line, from Shakespeare’s play, Macbeth, refers to the protagonist’s subconscious thoughts of murdering a king and usurping his throne. Shakespeare’s quote is analogous to what’s happening in Greece.

Because today, Greek prime minister Alexis Tsipras of the far-Left Syriza party is chasing the dagger. And he’s targeting his own country. Thanks to Tsipras’s “leadership,” Greece is now under capital controls, and its banks are shuttered. Rather than compromise to save Greece from immense hardship, Tsipras has instead chosen deepening crisis. He’s holding a July 5th referendum on the creditors’ bailout terms.

But that choice isn’t born of tough leadership, it’s a consequence of Tspiras’s political gamesmanship. He hopes that by stoking nationalist pride, he’ll force EU creditors to surrender. Yet the EU is far more likely to let Greece collapse. This was always a strong possibility. From the moment Greek voters made their choice and put Tsipras in office, he’s embraced a “dumb and dumber” strategy. But since then, Tsipras has transitioned from stupidity to absurdity to vaudevillian extremism.

Consider the facts: $356 billion in debt, Greece obviously needs massive structural reform. But even now — at the crunch moment — Tsipras offers no serious reforms. Instead, he proposes increasing taxes on large companies and increasing employee pension contributions. In essence, Tsipras is doubling down on what has ruined Greece: its decaying, inefficient economy and its repellant investment environment. Most indicative, Tsipras has refused pension cuts or increases to pension-eligibility ages. Facing the 75 percent of Greece’s pensioners who retire before 61 years of age, and other vested interests — read this Reuters article from 2011 (few reforms have occurred since) — Tsipras yields. Still, with an elderly population and no population growth, Greece cannot ignore facts forever. Its pension crisis will only worsen.

Some say that Tsipras has been forced into this position by German chancellor Angela Merkel’s refusal to offer more concessions. But consider the European Commission’s final bailout offer. It was hardly extreme. In return for long-term support, the commission would have required Greece to reform its dysfunctional tax system, force competition in closed industries, and cut patronage-based economic subsidies. In short, the plan offered structural reforms to give Greece a new start. Sadly, in response, Syriza offered clown-like suggestions such as demanding war reparations from Germany.

But like Macbeth, Greece’s sinking future is undeniable: Interest rates on ten-year government bonds are 10.6 percent; its March unemployment rate was over 25 percent. Indeed, in February, Greece’s unemployment was over 50 percent for those under the age of 25.

There’s a broader issue at stake here. Whatever Syriza might claim, these statistics aren’t ultimately born of economic austerity (the U.K.’s austerity example proves otherwise). Rather, they are testimony to an abiding economic truth: Unreformed socialism stagnates economies, kills opportunity, and catalyzes human suffering.

Yes, to be sure, the European Union’s incessant idiocy — attempting to blend many cultures, languages, and political philosophies into one centralized, largely unaccountable bureaucracy — has denied Greece the flexibility to solve its own problems. Nevertheless, Syriza’s socialism offers no answers. The opposite is true: Unchecked, Syriza will bury Greece, and Greeks must face this reality. Tsipras certainly won’t. Like Macbeth, Tsipras seeks glory from his country’s loss. But unlike Macbeth, Tsipras’s stupidity won’t just ruin him; it will ruin Greece.