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We're still some distance from a lasting deal over Greece

It's good news that a deal has been reached between Greece and its creditors. But the details of this deal are not good.

Whatever some people might have been telling you, it's a good thing that a deal was done between Greece and its creditors earlier this week, but that doesn't mean it is a good deal.

Greece clings on, having been taken to the brink by both the country's international creditors and its government, whose decision to hold a referendum on and subsequent rejection of a previous (better) deal triggered two weeks of turmoil that left the country staring into the abyss.

The accelerated austerity policies demanded by the creditors will not only lead to more short-term misery, but in the long-run may end up being self-defeating - just as previous deals have been.

There's no point the Troika issuing a set of unrealistic demands, failing to learn the lessons of recent eurozone history. Such demands risk leaving Greece marooned amidst the circles of Hell, stuck in a nightmare of contraction, recession, bailout, contraction, recession, bailout, every few years, pulled one way by the creditors, the other by market and social reality, leading to the point at which default and departure seem preferable.

These demands, from predominantly right-wing EU leaders (and the World Bank and IMF), are but the latest manifestation of the post-crash failure of Europe’s centre-left. We have right-wing EU prime ministers, right-wing eurozone finance ministers, and hawkish global institutions calling the shots, while social democrat leaders like Francois Hollande find their voices drowned out by the likes of Angela Merkel and Wolfgang Schäuble.

That said, if Greece is to avoid perpetual bailout, the sword of Grexit forever hanging over its head, the government of Alexis Tsipras must take the lead and embrace reform, modernising the economy and changing the way it does business, something governments of left and right have failed to do.

As well as difficult reforms, the EU must offer the quid pro quo of positive Europe-wide action to help Greece, most obviously that means taking a realistic look at the prospects of repayment of Greece's debts. But there are other steps, such as tackling tax avoidance. In addition to strong domestic action on tax avoidance by the Greek government, EU action on tax dodging will enable them to broaden their tax base by making it easier to pursue tax dodgers across borders, stopping rich Greeks hoarding cash across Europe and evading their responsibilities.

What has gone before has not worked. And it is not just in Greece that prolonged austerity hasn't been working - across Europe a generation of young people are without jobs, without hope, without a future. France: 24 per cent. Slovakia: 26 per cent. Portugal: 33 per cent. Cyprus: 34 per cent. Italy: 42 per cent. Spain: 49 per cent. Greece: 50 per cent. Youth unemployment figures that should shame the right-wing austerians.

A less favourable deal - with even higher tax rises and deeper spending cuts - a loss of trust between Greece and the EU, and a prolonged period of pain: banks shut; capital controls; businesses going bust; 25 per cent unemployment; 50 per cent youth unemployment; a debt-to-GDP ratio of 180 per cent; an economy losing one per cent of GDP a week... this is the result of the creditors’ belligerence and Tsipras’s brinkmanship, and it’s wreaking a devastating toll.

And as always, it’s the ordinary people who suffer most. People out of work. People not being paid. People queuing for food, people queuing for money. Greece's downward spiral has been devastating to watch, and until a workable solution is implemented, they will continue to suffer.

 

Glenis Willmott MEP is Labour's Leader in the European Parliament.

 

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What Donald Trump could learn from Ronald Reagan

Reagan’s candidacy was built on more than his celebrity. Trump not only lacks experience as an elected official, he isn’t part of any organised political movement.

“No one remembers who came in second.” That wisdom, frequently dispensed by the US presidential candidate Donald Trump, came back to haunt him this week. Trump’s loss in the Iowa Republican caucuses to the Texas senator Ted Cruz, barely beating Senator Marco Rubio of Florida for second place, was the first crack in a campaign that has defied all expectations.

It has been a campaign built on Trump’s celebrity. Over the past eight months, his broad name recognition, larger-than-life personality and media savvy have produced a theatrical candidacy that has transfixed even those he repels. The question now is whether that celebrity will be enough – whether a man so obsessed with being “Number One” can bounce back from defeat.

Iowa isn’t everything, after all. It didn’t back the eventual Republican nominee in 2008 or 2012. Nor, for that matter, in 1980, when another “celebrity” candidate was in the mix. That was the year Iowa picked George H W Bush over Ronald Reagan – the former actor whom seasoned journalists dismissed as much for his right-wing views as for his “B-movie” repertoire. But Reagan regrouped, romped to victory in the New Hampshire primary and rode a wave of popular support all the way to the White House.

Trump might hope to replicate that success and has made a point of pushing the Reagan analogy more generally. Yet it is a comparison that exposes Trump’s weaknesses and his strengths.

Both men were once Democrats who came later in life to the Republican Party, projecting toughness, certainty and unabashed patriotism. Trump has even adopted Reagan’s 1980 campaign promise to “make America great again”. Like Reagan, he has shown he can appeal to evangelicals despite question marks over his religious conviction and divorces. In his ability to deflect criticism, too, Trump has shown himself as adept as Reagan – if by defiance rather than by charm – and redefined what it means to be “Teflon” in the age of Twitter.

That defiance, however, points to a huge difference in tone between Reagan’s candidacy and Trump’s. Reagan’s vision was a positive, optimistic one, even as he castigated “big government” and the perceived decline of US power. Reagan’s America was meant to be “a city upon a hill” offering a shining example of liberty to the world – in rhetoric at least. Trump’s vision is of an America closed off from the world. His rhetoric invokes fear as often as it does freedom.

On a personal level, Reagan avoided the vituperative attacks that have been the hallmark of Trump’s campaign, even as he took on the then“establishment” of the Republican Party – a moderate, urban, east coast elite. In his first run for the nomination, in 1976, Reagan even challenged an incumbent Republican president, Gerald Ford, and came close to defeating him. But he mounted the challenge on policy grounds, advocating the so-called “Eleventh Commandment”: “Thou shalt not speak ill of any fellow Republican.” Trump, as the TV debates between the Republican presidential candidates made clear, does not subscribe to the same precept.

More importantly, Reagan in 1976 and 1980 was the leader of a resurgent conservative movement, with deep wells of political experience. He had been president of the Screen Actors Guild in the late 1940s, waging a campaign to root out communist infiltrators. He had gone on to work for General Electric in the 1950s as a TV pitchman and after-dinner speaker, honing a business message that resonated beyond the “rubber chicken circuit”.

In 1964 he grabbed headlines with a televised speech on behalf of the Republican presidential candidate, Barry Goldwater – a bright spot in Goldwater’s otherwise ignominious campaign. Two years later he was elected governor of California – serving for eight years as chief executive of the nation’s most populous state. He built a conservative record on welfare reform, law and order, and business regulation that he pushed on to the federal agenda when he ran for president.

All this is to say that Reagan’s candidacy was built on more than his celebrity. By contrast, Trump not only lacks experience as an elected official, he isn’t part of any organised political movement – which enhanced his “outsider” status, perhaps, but not his ground game. So far, he has run on opportunism, tapping in to popular frustration, channelled through a media megaphone.

In Iowa, this wasn’t enough. To win the nomination he will have to do much more to build his organisation. He will be hoping that in the primaries to come, voters do remember who came in second. 

This article first appeared in the 05 February 2015 issue of the New Statesman, Putin's war