With Europe torn on whether Syriza’s projected win in the upcoming elections of January 25th will jeopardize Greece’s recovery – let alone its very presence within the eurozone, we ask four economists with deep knowledge of the Greek and European financial situation to share their insights on the party’s programme as it was presented to fund managers and bankers in the City of London (you can find the presentation here)  and its direction as a whole (see the recovery plan Tsipras presented to the Greek public, in English, here)

Philippe Legrain (@plegrain)

While there is much in Syriza's programme that I don't agree with, Alex Tsipras is right that Greece needs debt relief in order to recover and that the country should not be bled dry to pay off its foreign creditors. Where are the other voices demanding debt justice? Greece needs them. It's a tragedy that Greece’s corrupt elites have collaborated with eurozone policymakers at the expense of ordinary Greeks who continue to suffer unnecessarily great hardship. And when new elections are called, Greeks should not be blackmailed by EU leaders into voting for Samaras again. If Angela Merkel was wise, she would make a make a virtue of a necessity and call a debt conference to write down Greece's debts, as Germany's were in 1953. Failing that, Greeks need to stand up for themselves and elect a government willing to threaten default on the EU loans, which were not a gesture of solidarity but a bailout of the French and German banks and investors that recklessly lent to Greece, and which are in any case unpayable.

Jens Bastian (@Jens_Bastian)

There is growing international interest in Syriza's policy priorities in the event of the opposition party leading a government in Athens in the course of 2015. This interest also creates an obligation for the Coalition of the Radical Left to articulate their priorities and have these challenged in the court of public opinion.
Three issues are of prime importance for international observers of Greek politics. They concern SYRIZA’s proposals for:

  • Debt restructuring: Syriza wants a moratorium on debt servicing and the “restructuring of public debt by ‘haircut’” .
  • The banking sector: SYRIZA seeks private debt restructuring (e.g. concerning NPLs) and pro-active “banking management” by the Hellenic Financial Stability Fund (HFSF). Put otherwise, policy conditionality for and targeted intervention in the day-to-day operations of the four recapitalised Greek banks.
  • The European context: The opposition party calls for the revision and/or easing of the Stability and Growth Pact in the euro area. Furthermore, Syriza is in favor of issuing of Eurobonds and has called for the ECB to start buying of sovereign bonds in the context of a sustained quantitative easing (QE) initiative.

It will not come as a surprise that such policy proposals from the leading opposition party in the Greek parliament are anything but reassuring for international observers, be they government ministries in Berlin and Paris or the ECB in Frankfurt and portfolio managers with financial exposure to Greece.
SYRIZA representatives face a mountain to climb in terms of the credibility and practicality of their economic policy priorities, domestically as much as on an international stage. The reception their proposals recently received in the City of London is indicative of the work that remains to be done, in Athens and abroad. 
Reaching out to foreign constituencies and stakeholders in order to build policy coalitions at a European level may contribute to an unintended reality check on the merits of these policy priorities. Various ministries across the euro area are developing Plan B options as regards Greece should Syriza come to power in 2015. Syriza itself is increasingly engaging in similar out reach activities at the European level, e.g. as regards their recent joint activities with Podemos in Spain.

Klaus Kastner (@kleingut)

I am an American at heart. I first went there, at age 18, as an exchange student. I then received a full scholarship at Harvard and afterwards I spent my first career at a prominent American bank which, to this day, I consider the best employer I ever had, In short, I have been formed and shaped by Americans. Part of that is the preparedness to give everyone, at the outset, the benefit of doubt. I have written many articles about Alexis Tsipras and SYRIZA in my blog. The tenor was never to discredit them by way of prejudice. Instead, the tenor was always to give them the benefit of doubt that they might perhaps be, indeed, the solution for Greece. After reading about their latest revelations in London about their economic plans, I can only say what I understand to be an old Greek proverb: “Any fool can throw a stone into the ocean but, once he has done it, not even a hundred wisemen can get it out again!”
Have I made myself clear?

Yanis Varoufakis (@yanisvaroufakis)

Disclaimer: At the time of publication of this article, Yanis Varoufakis will reportedly run with SYRIZA in the upcoming elections. 

In recent days, much has been made of meetings between SYRIZA representatives and hedge fund managers in London. “Markets spooked” was the main headline. I do not claim to know (or to care much regarding) what transpired in those meetings. What I do know is that fund managers who had allowed themselves to be conned by the twin bubbles Berlin and Brussels, with Frankfurt’s connivance, concocted, were always going to be spooked when reality burst these bubbles. The sooner this happened, the better. ‘Extending and pretending’ has reached its limits, has caused untold human damage in Greece, and has played a major role in maintaining the current irrational macroeconomic posture of the Eurozone.

A more elaborate version of this view can be found on Varoufakis’s blog