Has Europe’s radical left failed to offer an economic alternative?

Anna Sonny, 28 August 2015

The economic crisis in 2008 created fertile ground for the anti-establishment, anti-austerity message to flourish. But one of the most pertinent tests for this rhetoric of course, is how the economy performs, whether it grows and whether the electorate actually feels the effects of the growth. As we saw here in the UK a few months ago, despite railing against austerity cuts, the majority of the British public felt that the Labour party offered no economic alternative to the Conservatives, and this was one of the many reasons it received a thrashing at the polls. A smidgeon of 0.4% growth at the time of voting was enough to give the Conservatives a majority.

Greece is set to go to the polls again next month after Prime Minister Alexis Tsipras lost his majority in parliament last week. Almost a third of his MPs voted against his deal with Greece’s creditors, meaning that the radical left-wing party, after fighting hard to reject austerity, will have to fight to defend its policy record.

Greece’s economy has been compared with that of Latvia’s, with both suffering high foreign debt, gaping budget deficits and dives in GDP in the onslaught of the crisis, and Latvia experiencing one of the deepest recessions in the world. In post-crisis Latvia, the social-democratic coalition Harmony Centre rose steadily in popularity, winning the most votes in elections in both 2011 and 2014 but not enough to form a majority, and so remained in opposition, until breaking up last year. Harmony Centre supported increasing social spending, in contrast to the cuts that that were being pushed through by the government; but after following its course of austerity, Latvia was the EU’s fastest growing economy with 4.2% in 2013, and last year posted growth of 2.4%.

The past few months have been a huge test for Syriza, an upward trajectory riddled with missed deadlines, an extremely close call with economic collapse, a default on debt, and the introduction of capital controls; in answer to the question of whether the radical left can offer an alternative economic policy to austerity, the evidence seems to point to the negative.

This could well be the Spanish electorate’s conclusion too, with the left-wing Podemos party losing ground, and the centre-right Popluar Party, who have followed a programme of austerity and seen economic growth this year, gaining in recent polls after delivering its budget. Greece’s failure to get rid of austerity could prove to be a boost for Spanish Prime Minister Mariano Rajoy at the elections towards the end of this year.