The Greek Referendum Alexis Tsipras has announced last night, June 26th 2015, is probably the best they can do. The story that has been going on here was one, where from the very start, the new Greek government was insisting that this was political and could only be solved by heads of state, while the creditors - and we are to be reminded who they are, the governments and nations of the Eurozone, the European Central Bank and the IMF - kept insisting that this was a technical issue which Greeks had to solve with the "Troika" rechristened as "institutions". This central contradiction did not go away, all along, the Europeans insisting with steely determination, that it was merely a financial issue, about debt, and that the "ball was in the Greek court", in other words, the Greeks had to accept the conditions imposed on them, or else. Now politicizing this process again by holding a referendum will bring the Europeans under pressure, since they will find it difficult to circumvent such a plebiscite.

Unfortunately, this affair reminds me very much of what Karl Polanyi wrote in The Great Transformation. The parallels are just too striking, as wrong polices are creating conditions for political instability harmful beyond the wildest imagination. It is sad to see that those political leaders have no advisers with any historical knowledge, otherwise they couldn't act like that. The first aspect is the fetishisation of money, or rather a hardline monetary policy. After the disaster of the Great European War, they tried to reintroduce the gold standard. This created a lot of hardship for national economies just emerging from war and burdened with debt. It precluded them from introducing more social polices, which would have been urgently needed. This destabilized them and furthered political extremism on the left and right. Polanyi's second point was the contradiction between democracy and business. In many countries, after the war the working classes had received voting rights. This resulted in gains for centre left and leftist parties who would form governments and tried, despite austerity, to implement more social policies. This scared the elite, the "bourgeoisie" in the classical sense, the large capital owning class. They thus decided that democracy was bad for their business interests and started to support right-wing political parties.

This all worked as long as generous American loans went to Europe. However, after Black Friday, the crash of the NYSE, those capital flows dried up rapidly. This took a while to work itself through the system. Then in 1931 one bank of a relatively minor and unimportant nation crashed. That was the Creditanstalt in Austria. This, and not 1929, was actually the moment when the world economy started to unravel. What followed was the Great Depression, a severe economic slump, accompanied by nearly complete severance of business ties across the globe. That, all together, in Europe, to quote Wikipedia, provided a major propaganda opportunity for Adolf Hitler and the Nazi Party: it allowed them to further blame Jews for German and international economic and social troubles." In Austria, kit created the pretext for the catholic-fascist Putsch in 1933/34. In Germany it lead to Nazis seizing power and starting the Second World War.

Now one should be not too taken away by historical analogies, and I certainly don't want any terrible things to happen. But the signs are there for Europe continuing on this slippery slope with more austerity, as just gets proscribed in Britain, again, and the rise of right-wing parties. If this is allowed to go wrong histories' judgement about Merkel, Hollande, Cameron and so on will be harsh. Greece somehow accidentally falling out of the Euro will give a propaganda victory to the likes of Le Pen in France and Strache in Austria. Hungary is already developing into that direction. Economies of financially weak nations such as Croatia, Italy, Spain, will come under renewed scrutiny by financial markets. At the same time, the Southern Balkan has been turned into an assemblage of failed states, such as Kosovo and Bosnia-Hercegovina, which are protectorates, basically, Macedonia, Montenegro on the verge of becoming permanent mafia states, Serbia struggling to create a sense of normality to maybe still make it into Europe. Lets not forget Ukraine, of course, where particularly irresponsible things are being done.

There is already a very tense climate. These European politicians who are calling the shots that it is dangerous indeed to act against democracy. A weakening of democracy is what we currently cannot allow. This is also why I am writing. My feeling is that so far the "liberal elites" are not pulling their weight politically. By liberal elites I do not mean neoliberals, but the creative and educated classes who often pretend to be too busy to note politics proper. I count myself to that and also refer to study 1960s modernistic avant-garde movements to political organising. But I think the broad, liberal, left, non-xenophobic, non-homophobic cultural majority needs to shake off its political sleep and not allow these politicians to continues, while leaving the field of agitation to right-wing populists. Greece and Spain have already shown the way with election victories. I think it is time that a European really new left needs to form to address the stagnation arising from the old centrist parties. The political hegemony of the old centrist parties is under threat, and they are doing the best to further that process. Therefore, a really new left should make its voice heard.

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