Mr. Tsipras Comes to Washington

Editor’s Note: Greek opposition leader Alexis Tsipras 

spoke at Brookings on January 22

during his first trip to Washington. While at Brookings, Tsipras discussed Greece’s austerity measures, its image in the international community, the country’s relationship with the Euro zone, and its potential for economic growth.

The new head of Greece’s opposition party, Alexis Tsipras, came to Washington this week. Mr. Tsipras has become a key player in the Euro Crisis. His meteoric rise in the polls and close second-place finish in Greek elections last summer rattled global financial markets. His pre-election rhetoric raised the possibility of a Greek exit from the common currency, which could have led to a domino-like collapse of the Euro.

Mr. Tsipras’s trip to Washington was his first, meeting with government officials, members of congress, policy analysts, Greek American groups and the public. He brought with him members of his SYRIZA party, which literally translates as the Coalition of the Radical Left. That name makes Americans nervous, since America has never had a viable socialist party. SYRIZA, for its part, outflanks the socialists to their left, so many Americans were doubly nervous.

Optimists and pessimists could both find what they were looking for in his visit. As one American with whom he met said privately, “We agreed on somewhere between 40% and 60% of what he said. So let’s call it 50-50.” That assessment is about right.

Mr. Tsipras delivered four core messages. He found a receptive audience for two, but less so on two others.

Tsipras Success. Tsipras has consistently argued that the austerity measures that Europe has forced on Greece will not create growth.

Many in Washington agree. If Europe had had an Obama-style stimulus plan and a Bernanke-style monetary policy, Greece would not have become the Achilles Heel of Europe. Instead, lack of fiscal and monetary support has lead to a shrinking economy, unemployment, fear and hopelessness in the Greek public.

In fact, continuing to focus on political sustainability is Mr. Tsipras’s most effective argument. Economic and political reforms must be “owned by the people” of Greece, or the country will not be able to heal itself. That means that both growth and sacrifice need to be shared fairly. He cited the recent U.S. fiscal cliff agreement that led to a slightly more equitable tax system, targeting the truly wealthy. And his own recommendations are not to nullify the current agreement between Greece and its European lenders, but instead to renegotiate a more gradual approach to a balanced budget. Public employees need to feel part of the agreement.

Second, at a personal level, Mr. Tsipras sought to shed the caricatures that have shaped the international image of the Greek left. In a country where leftists have historically been incendiary, prone to violence, and aggressively anti-American, Mr. Tsipras came across as genial, courteous, pragmatic, and eager to hear American views. While he certainly has strong ideological leanings, he showed himself to be someone genuinely interested in hearing suggestions and even criticisms. He spoke warmly about President Obama’s inaugural calls for social justice. And he held himself up as the last best hope of Greece falling into the hands of the neo-fascist Golden Dawn party.

In that regard, many noted his recent trip to Brazil, where he met with former President Lula da Silva. In the 1990s, Lula famously shed his militant image to become a beaming and gregarious icon for a globally integrated and competitive Brazil. Should Tsipras become prime minister some day, he seemed to say, he would be just such a leader.

Tsipras Trip-ups. Mr. Tsipras has a ways to go in convincing his skeptics on his third core argument: that the Euro zone needs Greece as much as Greece needs the Euro zone. He has repeatedly argued that Greece’s last two governments have too easily caved to the pressure of northern Europeans to accept austerity measures in exchange for new bailouts.

Some are still nervous about contagion from a Greek exit. By so brazenly playing the game of chicken with northern Europeans, Tsipras still keeps them up at night.

Many others, however, now believe that the European Central Bank and other Euro zone countries have defended themselves from the impact of a Greek default and return to the Drachma. Most Greek debt is now owed to the EU, ECB, and IMF, not private bondholders. That means that the contagion is less scary, and largely under control.

Ironically, Mr. Tsipras himself seemed a bit nervous when presented with the idea that Greece could or should leave the Euro zone. If that happened, it would take away his biggest bargaining chip.

Finally, Mr. Tsipras failed to convince people on a fourth point: that he has a positive vision for growing Greece’s economy. Whether Greece stays inside the Euro or reverts to the Drachma, it will still need to make major changes in its economy to attract foreign investment and boost its exports.

Tsipras avoided engaging on a concrete discussion of what would make Greece’s economy more competitive. He dismissed the idea that Greece was Europe’s last communist economy — saying that privatization had not happened because there really was nothing to privatize.

He also said that the focus on deregulating certain industries (pharmacies and hair salons) was a distraction to take away from the oligarchs’ own complicity in crime and corruption. There was a lot of talk from him and his party about taking aim at “robber barons” and “wealth redistribution”. While many Americans would certainly support equitable taxation and real jail time for real criminals in Greece, redistribution for its own sake is likely to scare away many investors.

The small good news here is that Mr. Tsipras regularly referred to the need to attract foreign investment, and he was keen to meet with investors. He also made allusions to developing strategies for key industries such as tourism, export agriculture, or energy. Still, the details of that strategy have yet to be worked out.

In this regard, many were quite concerned about his political strategy in the coming weeks and months. The situation in Greece has just begun to calm down, and the country will soon prepare for the critical tourist season. When I asked Mr. Tsipras if SYRIZA would avoid strikes — which have been so damaging to Greece’s image in the world — he said that each society had its own way of dealing with politics. “Politics is not tea and crumpets.” There is certainly a place for expressing dissent. But allowing a minority of Greeks to regularly shut down the economy is not democracy as Aristotle envisioned: the art of ruling and being ruled in turn.

There was an echo of the dark side of public employees in Athens this week. The head of the striking Athens metro worker’s union was asked if his union would follow orders to report to work or be fired. “Over my dead body.” Not tea and crumpets, indeed.

Over the coming months, Mr. Tsipras and SYRIZA will have ample opportunities to demonstrate that their definition of radical means not putting all of Greece out of work simply to win power. If, on the other hand, they can find a way to paint a positive vision for the future and an equitable role in the Euro zone, then the SYRIZA glass may become more than half full.