Syriza’s Unrealistic Plans for Greece

By Kailee Dahan Source: Reuters

After years of economic turmoil, Greece has elected the Syriza party into power in an attempt to find new leadership that can help the country rise out of its financial slump and recreate its economy. Prime Minister Alexis Tsipras, the new leader of the left-wing coalition party, has already begun to advocate for a number of bold plans that he believes will benefit the country of Greece.

In these striking new plans, Syriza has promised the Greek people: hundreds of thousands of new jobs, increased monthly wages, free access to energy for those living under the poverty line, debt write off, and the repeal of certain property taxes. While these ideas make for great political speeches and work to energize voters, they are extremely unrealistic in practice. Greece owes the European Union and International Monetary Fund an estimated $270 billion dollars after multiple bailouts. How then is it economically possible for a country to owe so much money but promise its people increased wages, 300,000 new jobs, and free resources for those living in poverty? The simple answer: it is not.

To facilitate these ambitious plans, Prime Minster Tsipras has created a strategy that would both allow for these grand changes and lower the amount of money owed by Greece to the European Union and the International Monetary Fund. The strategy entails the government cracking down on people who commit crimes such as tax evasion and smuggling. This crackdown would allow the government to finance the €11.3bn needed to pay for job creation, an increase in wages, free energy, and free medical care for select groups of Greeks. Additionally, Tsipras would like to write-off most of Greece’s debt, which totals almost twice as much as its gross domestic product (GDP), and tie the remaining debt to economic growth rather than the Greek budget. However, writing off the majority of Greece’s debt would likely just induce an economic crisis for the European Union because debt cannot simply cease to exist.

While Syriza’s economic plans are extremely unrealistic given their current financial status, the newly elected political party also plans to foster closer relations with Russia. Just a short time after being named Prime Minister, Tsipras has already undertaken his first foreign meeting with a Russian envoy and criticized EU sanctions that were imposed on Russia regarding its annexation of Crimea and involvement in Ukraine. After these events, it seems that Russia may have an emerging new ally in Greece. This recent development, coupled with the new economic plans for Greece, warrants increased international attention as the already destabilized Greece of the past few years may be entering into an even more troublesome situation.

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