Plan C: The socialist alternative for Greece

By Alex Steiner

A fascinating interview with the newly elected member of the Greek Parliament, Costas Lapavitsas, recently appeared in the periodical Jacobin. [1]

Costas Lapavitsas

Lapavitsas, who represents Syriza in Parliament, is a well-known left wing economist and a self-described Marxist.  And unlike the Minister of Finance Yanis Varoufakis, Lapavitsas is no "erratic Marxist" but is very much at home in the language of orthodox Marxism.  He says that he is in favor of a socialist revolution and would like to see that come about in Greece and throughout  the world. He even invokes the Bolsheviks, favorably mentioning Lenin and Bukharin. 

However when we take a closer look at his statements, it becomes plain that his form of Marxism is much closer to the Menshevik variety than to Bolshevism.  He says,

“You don’t need a socialist revolution, and you don’t need to overthrow capitalism at every minute of the day to do small things. Of course, we aim for the overthrow of capitalism, and of course ultimately we would like to see the socialist revolution. But that’s not in the cards at the moment.”

Setting aside the straw man of those calling for the “overthrow of capitalism at every minute of the day”,  Lapavitsas clearly expresses the notion that while he thinks socialism is a good idea in some vague and distant future, it is not a realistic possibility in the immediate future or even in what he calls the “mid term”.  Instead,  he thinks that in the near and mid term the best that we can hope for is a more benevolent form of capitalism.  And he thinks this completely achievable,

“You don’t need socialist revolution in Greece, and you don’t need to overthrow capitalism in Greece to get rid of austerity. You don’t.”

This in itself is hardly an unusual position within Syriza.  After all, Syriza’s election manifesto promised to put an end to austerity without in any way challenging capitalism.  But what puts Lapavitsas in conflict with the majority of his colleagues in Syriza is his thesis that Syriza must abandon its commitment to remain within the EU and make plans to break from the Euro.   He thinks that policy of remaining within the EU that has been carried out by all the previous governments, whether they were Pasok or New Democracy, and now Syriza, has been a disaster. He emphasizes this point several times in the course of the interview,

“…you certainly need to get rid of the institutional framework of the euro. That simple position is not understood — or is not widely appreciated — within Syriza and not within the European left, and that has been a tragedy for years.”

What I found interesting in reading the interview with Lapavitsas was not his politics,  which is that of a garden variety reformist social-democrat of the old type – in contrast to the new type of social democats whom you can find in the German Social Democratic Party or in New Labour in the UK, who have adopted  neo-liberal economic policies.  Nor are his differences about the Euro with the majority of Syriza that interesting.  Indeed the  likelihood is that exiting from the Euro will become the prevailing view within Syriza in the next few months as the impossibility of remaining in the EU becomes more and more apparent.

But by far what is most interesting in this interview was Lapavitsas’ discussion of what concrete policies need to be implemented to bring about a Grexit.  He calls this ‘Plan B’.   He summarizes some of the measures required for the implementation of Plan B as follows:

“So the government would have to impose capital controls immediately, and it would have to impose bank controls immediately. It goes without saying. It would have to do what the EU did in the Cyprus case. Now, how long these controls will last and what form they will take will be a matter of how the situation unfolds. They will certainly last for a significant length of time. And some form of capital controls will of course remain, as they ought to…

Then the state will have to intervene once it has nationalized the banks and re-denominated their balance sheets, to restructure the banks. The banks need reorganization to see which banks will remain and on what terms. That’s a process that will take some time, and it will not be easy.”

Capital controls and nationalization of the banks are quite radical policies. Lapavitsas later even admits that the economic policies he is proposing will necessarily lead to some form of rationing.  The radicalism of these policies must be understood however within the broader context of radicalism to what end? For Lapavitsas the end is clearly to save capitalism, if not exactly the kind of capitalism of the Eurozone. He frankly acknowledges the pedigree of his proposals in the theories of John Maynard Keynes,

“Keynes and Keynesianism, unfortunately, remain the most powerful tools we’ve got, even as Marxists, for dealing with issues of policy in the here and now…

Marxism is about overturning capitalism and heading towards socialism. It has always been about that, and it will remain about that. Keynesianism is not about that. It’s about improving capitalism and even rescuing it from itself. That’s exactly right.”

One could hardly ask for a clearer statement of the direction of the official Left wing of Syriza.  And Lapavitsas admits that his brand of “orthodox” Marxism pretty much amounts to the same thing as the “erratic Marxism” of Yanis Varoufakis.

But whatever one thinks of the policies themselves one has to acknowledge that Lapavitsas criticism of much of the Left, that they have never thought through any concrete policies, is on the mark.  He says,

“There’s a traditional saying in Greek that a man who doesn’t want to get married keeps getting engaged. Well that’s what the Communists have been doing, unfortunately. Because they don’t want to tackle the question of dealing with the situation in the here and now, they talk about revolution.

So, if you do that, you don’t have to confront the question of the euro. You pretend the question of the euro is somehow either a minor question or a side question or whatever. Or you elevate things beyond: what you need is to get out of the European Union, to get out of NATO, to get out of this, that, and the other thing. In other words, you’re not offering any specific answers, because you’re answering everything.”

And while Lapavitsas remarks here are directed specifically against the Stalinist Communist Party of Greece (KKE),  they could just as easily apply to much of the Left. The KKE has a history of combining the worst sort of opportunism with a dogmatic sectarianism. So while they have had no problem in the past in participating in coalition governments with the bourgeoisie, they have steadfastly refused all demands for joint action in any of the demonstrations or general strikes against the previous Pasok and New Democracy governments.  And the KKE, like most sectarian outfits, steadfastly avoids putting forward any concrete policy proposals in its platforms but instead rely on abstract slogans.  Lapavitsas criticisms are certainly justified when it comes to these sectarian outfits (which Lapavitsas tries to identify with the entire Left.)

On the other hand, the opportunist ANTARSYA coalition ran in the last elections on a platform that has been correctly characterized as one of “left nationalism”.  It made an alliance with the MARS group which has been advocating a return to the drachma.  Unlike the sectarians ANTARSYA did have lots of “concrete proposals.”  In fact they advocated policies not so different than those proposed by Lapavitsas.  As one observer noted, for ANTARSYA,

“…the best alternative to a program of reform is to offer a rival program of greater reforms. In this revolutionaries are different from reformists principally in that they ask for more.” [2]

The author of those remarks also notes that ANTARSYA saw its role as that of playing a game of one-upmanship against Syriza,

“So Syriza offered Greek nationality to the children of all migrants; and, like a poker player, Antarsya “raised” them by offering to legalize all immigrants in Greece.”

But this raises an important question.  What would a revolutionary alternative to Syriza look like?  It would certainly not be the vacuous slogans offered by sectarians. Lapavitsas makes a valid point in that regard. But neither would it be Lapavitsas “Plan B” or the  more radical version of “Plan B” offered by groups like ANTARSYA.

Let’s call the alternative Plan C, the socialist alternative.  And unlike Lapavitsas,  for us socialism is  not a dim goal in a far removed future,  but an objective we can begin to move towards immediately and realize well within the span of one generation. The socialist alternative implies the reorganization of society on the basis of production for need instead of production for profit. It does mean that Greece’s future lies not with the EU or with a return to the drachma based on some kind of revival of Greek capitalism, but on the establishment of the Socialist United States of Europe.  But how does this come about?  Contrary to the sectarian ultra left groups, fighting for the socialist revolution internationally  does not mean we are absolved from developing concrete policy proposals for the  here and now.  In that respect Lapavitsas has a valid point.  What then would the concrete proposals needed to fill out Plan C look like?

To elaborate such policies involves some degree of speculation,  and by that I don’t mean elaborating a purely imaginary plan but something more like a thought experiment based on historical precedents whose applicability is very tentative and projections based on a course of events that cannot be predicted with any degree of precision.  Given that caveat, the exercise may nevertheless prove useful to those seriously working toward a socialist alternative for Greece. I will outline what I think are some of the key economic issues that need to be addressed.  There are clearly other issues relating to foreign policy, political organization, science and culture, etc that also need to be addressed in a serious program dealing with the transition to socialism. These could perhaps be the topic of a separate essay.

First of all one has to acknowledge that any such program cannot under any circumstances be implemented by Syriza, not only because Syriza is wedded to a program of reforms within capitalism despite its rhetoric, but also because by its nature the transition to socialism cannot be entrusted solely to the vehicle of parliamentary politics.  It will require action from the ground up, by the masses taking their destiny into their own hands and creating their own forms of organization.   It is also inconceivable that such actions can succeed without a trained revolutionary leadership. Nevertheless, in keeping with our thought experiment, let us imagine that Syriza was a genuine revolutionary organization. In that case it could do plenty, even within the framework of parliamentary politics, to encourage  a powerful movement by the masses. 

So  in this thought experiment we would be imagining what policies would be advocated by a parliamentary party, which unlike  the real Syriza,  saw the alternative to austerity as the inauguration of socialism. 

And the first thing we can say is that many of the policy proposals suggested by Lapavitsas would indeed be instituted immediately by a socialist government. An exit from the Euro would certainly be one of the first measures that would need to be implemented. Capital controls to prevent the flight of capital out of the country and the nationalization of the banks would also follow.  Even a form of rationing would undoubtedly be necessary in order to deal with the inevitable shock of a sudden transition to a different economic system.  One can say that these are “Keynesian” policies, although their purpose would be very different than that envisioned by Lapavitsas.  They would be measures on the road to socialism instead of measures meant to “save capitalism from itself”. The context of such measures makes all the difference. Such measures by themselves are certainly not “socialist”. They are clearly undertaken within the framework of a market economy.  But such measures will be necessary for a period of time as the economy is in transition to socialism.  To imagine that no period of transition is required to go from the rule of the law of value to the society of associated producers is sheer fantasy, especially for a small country like Greece that at least for a period, can be expected to be relatively isolated.   Clearly replacing the mechanism of the market that governs the production, distribution and consumption of an entire nation with another, completely new mechanism, is not a trivial task and if not thought through on the basis of the best available expert knowledge could have catastrophic consequences.  In all likelihood, even under the best of circumstances,  the transition will be accompanied by a period of perhaps severe privations, even worse than those suffered by the austerity measures imposed by the EU.  A revolutionary government would honestly explain that to its supporters.  If the masses believe in the prospect of socialism and are involved at every level of democratic decision making they will agree to the sacrifices required.  Most left wing groups who have not thought deeply about the implications of the  transition to socialism, seem to have forgotten this.  This was a point once made by George Orwell, though writing in a very different context, on the victory of the Labour Party after World War II and the repudiation of Churchill’s leadership.

“The weakness of all left-wing parties is their inability to tell the truth about the immediate future. When you are in opposition, and are trying to win support for a new economic and political programme it is your job to make people discontented, and you will inevitably do it by telling them that they will be better off in a material sense when the new programme is introduced. You probably don’t tell them, what may very well be true, that they won't experience these benefit immediately, but only after, say, twenty years. The British people have never been warned, i.e. by the Left, that the introduction of Socialism may mean a serious drop in the standard of living.” [3]

Orwell’s estimate of 20 years is needlessly pessimistic, but he is undoubtedly correct in his main point, that a transition to socialism will entail a period of deprivation and that a party that advocates this course needs to be honest about it.  Lapavitsas also, speaking as a professional economist, recognizes that a transition period will entail a period of perhaps severe deprivation. He says that even a “controlled exit” from the Euro would lead to worsening of conditions for workers,

“...wages must rise, but even if they rise, you’re not going to go back to where you were. It’s just not feasible at the moment. We need a growth strategy for that.”

Given the reality of a period of deprivation, why then continue to advocate a strategy of “saving capitalism” when one can embrace a strategy of a transition to socialism. Why go through  all that pain for such a meagre “gain”?

In any case a revolutionary government, while recognizing the necessity of sacrifices, would adopt a goal of minimizing them as far as possible and speed the transition to socialism.  That will mean looking for assistance from the international working class and the establishment of socialist regimes in other countries. Were Greece to embark on the road to socialism it could in turn spark political movements in other countries.  But even so, assistance from abroad will not happen overnight and until that is forthcoming the new regime must work out a plan for survival in the face of the near certain cut off of credit and trade by the EU and North America.  An economic boycott will be a certainty once the government repudiates the debts. One can expect that trade relations with countries that may be sympathetic to the new government may ease the burden.  Russia, China,Venezuela could possibly fill in some of the gap caused by the end of trade with the EU. 

Many details would have to be worked out. A plan for regulating what for a time would be a “mixed” economy would have to be developed.  Some enterprises, especially smaller ones, should be allowed to and even encouraged to continue operations on a for profit basis, though now they would be managed by and run democratically by their workers.  A master plan for regulating the chain of supply and demand in each industry and in the different branches of agriculture and their place in the overall economy would have to be worked out.  Finally, an analysis of how each industry and the economy as a whole impacts the environment and the climate would have to be integrated into any economic plan.  This would clearly require the combined expertise of specialists in economics and the social sciences as well experts within each industry. It would be an opportunity to harness the enthusiasm of students and  professionals in these fields and bring them together with workers in the different industries all working together cooperatively to come up with a viable economic plan.

There are of course some historical precedents the new government could examine for assisting it in formulating its economic policies, especially the policies adopted by the Bolsheviks immediately after their seizure of power.  But these are likely to be of only limited value given the vastly different circumstances of Russia in 1917 and Greece in 2015.  Without discounting the rich history  of lessons to be absorbed from a close study of the policies of the Bolsheviks and other historical precedents, the new government would be largely on its own blazing new trails in the making of history. Which is not to deny that they will have a vastly changed potential for coordinating economic planning and democratic participation as a result of the communications revolution brought on through the Internet.

We can continue this thought experiment in more detail, but the basic outline is clear enough. A real alternative to austerity is neither the wishful thinking or sloganeering of sectarians or the kind of false pragmatism of Lapavitsas.  Rather it means thinking concretely and deeply about what policies are entailed for a genuinely practical transition to socialism.

There is one last point in Lapavitsas interview that is worth a comment.  At one point he takes to tasks those Leftists who think that politics determines everything.  He says,

“Geopolitics and domestic politics, the balance of political forces,  that’s what Marxism has been reduced to, unfortunately. And, when you do that, when you commence with the politics — the balance of forces domestically or internationally — it is easy to engage in flights of fancy. It is easy to begin to think that, in the end, everything is politics, and therefore you can change the balance of political forces, and anything is achievable.

Well, I’m sorry, that’s not the case. And that’s not Marxism. As Marxists, we believe that politics, in the end is derivative of the material reality of economic and class relations. That’s a very, very profound statement by Karl Marx, so long as it is understood properly, so long as it’s not mechanical. The bottom line is this statement means that not everything is possible through politics.”

Here I would have to say that Lapavitsas is at once correct and incorrect.  It is true that many so-called Marxists engage in “flights of fancy”,  that is to say they view the possibilities for action simply  within the framework of political action without paying any attention to the constraints imposed by the economy.  But while Lapavitsas is correct in pointing out that for Marxists, “politics, in the end is derivative of the material reality of economic and class relations”,  he forgets that there is a dialectical relationship between economics and politics and that is also a truism for Marxists.  Although economics is certainly the final determinant in shaping the configuration of a society the political struggle can be the decisive factor in either opening or closing off an avenue of economic development at a critical moment.  Lapavitsas would have done well to recall an observation of Trotsky’s, who in writing on the impact of the Stalinist bureaucracy on the Soviet economy, noted the critical role of political forces,

“The processes of economic construction are not yet taking place within a classless society. The questions relating to the allotment of the national income compose the central focus of the plan… All these questions by their very nature do not allow for a priori decisions by the bureaucracy, which has fenced itself off from intervention by concerned millions.

The struggle between living interests, as the fundamental factor of planning, leads us into the domain of politics, which is concentrated economics.” [4]

Lapavitsas “forgets” this part of the dialectical relationship between politics and economics because he has decided to limit his choices to that between continuing the Euro and more austerity or Plan B, a transition to the drachma and a hopeless form of Greek capitalism.  He removes from the table any consideration of the real alternative to the Euro, Plan C, the transition to socialism.

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[1]  https://www.jacobinmag.com/2015/03/lapavitsas-varoufakis-grexit-syriza/

[2]   https://www.jacobinmag.com/2015/02/antarsya-syriza-greek-left/

[3]  Essays, Journalism and Letters: Volume 3, As I Please, 1943-1945. Letter from London. Page 396.

[4]  https://www.marxists.org/archive/trotsky/1932/10/sovecon.htm