Austerity and Greece
Austerity measures refer to steps taken by governments facing massive debts to rein in their spending. Often, austerity measures are a pre-condition imposed by lenders or creditors who provide the bailout packages to the governments in debt. The governments in question are in no position to contest such requirements because if they cannot secure funding from lenders, they run the risk of bankruptcy.
The recession of 2008 affected multiple economies around the globe. Countries in Europe especially have been unable to recover from the growth slump. Most economies were spending more money than the revenue they generated. This led to the piling up of debt, which sometimes even exceeded the country’s GDP. Hence, to avoid bankruptcy the governments had to approach institutions and others for immediate credit; which was provided to them but with stipulations. Thus, many governments such as Greece, Ireland, Portugal, Spain etc had to heavily cut down on social spending. In countries like Greece, many governmental employees lost their jobs. And the lack of economic growth and government incentives for businesses discouraged new ventures and high unemployment rates persisted and further acerbated the issue.
As austerity measures were tightened and the governments increasingly cut back on expenses and provided fewer social services, dissent against the harsh austerity measures which were often imposed by foreign or multilateral institutions such as IMF, EC (European Commission) etc grew. The austerity measures led to cutbacks in public health services, elderly care, loss of pension, funds marked for education and other welfare measures that deeply affected the common man. Research has shown that the anti-austerity measures are affecting the health and quality of life of millions of people across Europe and North America. The number of suicides and recorded instances of persons from depression has increased significantly. These conditions have led to widespread protests against austerity which have grown into popular anti-austerity movements across Europe, and resulted in the formation of parties that are fighting on an anti-austerity platform.
Greece and the Syriza Party
The Syriza Party in Greece is a coalition of the radical left, and one of its major promises is withdrawal of budget cuts and other austerity measures. The Party recently formed a coalition government after it received a majority of the votes, but fell short of the required minimum to form the government. The Party opposes the terms on which Greece was given a $270 billion bailout package by the European Commission, European Central Bank and International Monetary Fund. The Syriza is extremely popular in the county which is battling a high 26% unemployment rate and 1/3rd of whose population lives below the poverty line. While the victory of Syriza is making foreign investors nervous that Greece might leave the eurozone, its popularity has reinvigorated parties contesting on the anti-austerity platform elsewhere in European countries like Spain, Italy and UK. For instance, the success of Syriza is believed to have boosted the popularity of Podemos, Spain’s anti-austerity party.