WHEN THE PUBLIC is disillusioned with an entire political culture, it’s not a problem that technocrats alone can fix. But an unlikely band of Greek reformers may have an answer for an unsettled Europe — and the entire Western world.
Over the last seven decades, Western Europe, with support from the United States, built a liberal order around lofty goals — peace; stable, elected governments; open economies; and shared solutions to regional and global needs. Today, though, Europe’s institutions inspire as much frustration as admiration, with many questioning the entire conceit of a united continent. In the European Union today, citizens heap disdain on the experts in Brussels who have produced reams of regulations on everything from mine safety to banking hours to what kind of labels cheesemakers can use. The sense of malaise ballooned after the 2008 financial crisis exposed the cracks in the union’s foundation, and still more after a wave of new migrants arrived from the south and east beginning in 2015.
While the Brexit vote and the emergence of Donald Trump have prompted some in Europe to rally to the EU’s defense, a homegrown extreme right has gained influence by opposing immigrants and the European Union alike.
Over the years, Europe’s solution to many woes has been to elevate technocrats to ever-greater positions of power, enabling them to go around populist politicians. Yet according to a newly energized wave of reformers, Europe’s penchant for experts has been its undoing, breeding a culture of contempt for democracy.
“We have a Europe that has lost its democracy and legitimacy and soul,” said Yanis Varoufakis, the former finance minister of Greece and founder of the Democracy in Europe Movement 2025, which is trying to invent a new kind of transnational politics that will revive Europe. “We want a European democratic union. Otherwise everything we care about will go to the dogs.”
His movement has attracted 100,000 members and is promoting what it calls a “European New Deal,” modeled after Franklin D. Roosevelt’s New Deal.
The activists in Varoufakis’s movement, also known as Diem 25, argue that if Europe is to survive and thrive, it needs to preserve its social-welfare values but also its capitalist dynamism. Their version of the New Deal would stop austerity policies, beef up anti-poverty programs, and invest in jobs for the unemployed.
Yet Varoufakis’s movement also thinks Europe needs an injection of American-style participatory democracy. Brussels operates by bureaucratic consensus. Diem 25 favors a pan-European government vested with more tangible, but also politically accountable, power.
Supporters of Diem 25 see their struggle as part and parcel of a global response to a crisis of inequality and illiberalism that connects them with Bernie Sanders in the United States and the Podemos party in Spain, and with more hardline constituencies like the Occupy movement and anarchist movements.
Varoufakis and his supporters aren’t revolutionaries. They want to channel a neglected group: the fed-up, left-behind 99-percenters who are angry at bankers, fat cats, and Davos grandees — but who also prefer to fix the system rather than blow it up. The Diem 25 movement wants to harness the energy and tactics of the radical left — but in service of a reform agenda that seeks to repair capitalism rather than replace it.
ALREADY, DIEM 25’S rhetoric is reflected in mainstream policy — in the grudging support for EU reform from German Chancellor Angela Merkel and in a more rousing call for reform this past week from France’s young new president, Emmanuel Macron. “The Europe we know is too weak, too slow, too inefficient, but only Europe gives us the capacity to act on the world stage in the face of the big, contemporary challenges,” Macron said in a speech that endorsed many of the Varoufakis bloc’s proposals
It’s striking that the vanguard of European reform has its roots in the tribulations of Greece. One of the EU’s smallest and weakest members, Greece knows how the union operates at its best and at its worst. Europe integrated Greece in 1981 to rekindle democracy there after a disastrous military dictatorship that fell in 1974. The ancient birthplace of democracy embodied the EU’s role of spreading not only wealth but freedom.
But when the financial crisis hit in 2008, it was every nation for itself. Rich countries in the euro zone, like Germany, had very different needs than poorer peers like Portugal, Spain, and Greece. A cabal of mostly unelected finance officials from rich Europe orchestrated a bailout for poor Europe, imposing draconian austerity and triggering a human calamity. Greece suffered the most, but other poor European countries also languished in depression. Meanwhile, immigrants flooded into a fractured Europe unable to coordinate its immigration policy or control its borders. Eventually a deal was reached that amounted to Europe paying Turkey to bottle up refugees there.
In tatters was any pretense of democratic international consensus. Extremist right-wing groups surged in popularity, while legacy national political parties and the bureaucrats in Brussels seemed out of ideas and popular appeal.
But just in the last year, a surprisingly vital third-way reform effort has surged. Varoufakis, an iconoclastic Greek economist, embodies this new fusion of radical and center. The 56-year-old career academic grew up as a self-identified radical and leftist. As a teenager he sided with socialists against the remnants of Greece’s right-wing junta. In the 1980s, he joined workers on the picket lines in England protesting against Margaret Thatcher’s austerity. By the 2000s, however, Varoufakis had adopted a strikingly centrist ideology.
Even before the 2008 financial crisis, he had begun writing extensively about the problems of runaway finance capital and of central banks more powerful than elected politicians. Yes, communism had failed spectacularly, as the demise of the Soviet Union in 1991 made clear. But triumphalist capitalism suffered its own catastrophe in 2008, Varoufakis believes, opening the path for a renewed social democracy and a heavily regulated version of capitalism.
Fresh off the publication of two books about the perils of global finance and his vision for a policy that preserved capitalism but shattered the hegemony of the elitist 1 percent, Varoufakis found himself suddenly swept from academia into politics in January 2015.
Greece’s new socialist party, Syriza, won power after the country’s established parties all imploded, and drafted Varoufakis to join the government and run its do-or-die negotiations with the euro zone in 2015. For six months, Varoufakis confronted the most powerful finance ministers and central bankers in the world, and made his case to everyone who would listen. Austerity punishes the poor for the incompetence of financial elites, Varoufakis proclaimed.
Europe’s bankers crushed Greece’s attempt to rebel against austerity. Varoufakis left government perversely energized by his failure. He published a tell-all about the secret negotiations to bring Greece to its knees called “Adults in the Room,” with zingers from conversations he had secretly taped on his phone during meetings he’d had with masters of the global finance universe.
The 500-page memoir about the inner workings of currency union and bailouts made an unlikely best-seller. But like Thomas Piketty’s plodding volume “Capital,” it struck a chord with its explanations of the roots of inequality, and alienation — and with its concrete suggestions to improve matters with a hefty dose of electoral democracy and redistribution of wealth and power.
Whenever possible, the movement’s organizers want to persuade existing political parties to adopt the Diem 25 platform, like Poland’s Razem and Denmark’s The Alternative. But Diem 25 will also run for office at the European level; it already is planning a campaign for the 2019 European parliamentary elections.
The New Deal adopted by Diem 25 aims to revive and democratize Europe’s utopian ideals first through quick fixes that don’t require complex international treaties. These include investment in jobs for the unemployed, economic coordination with countries outside the euro zone, and a new digital payments system.
The next steps proposed by Diem 25 are more ambitious. A tax on finance would fund a European budget. The European Commission, which wields enormous executive power, would become directly elected. And the European Parliament, which today lacks even the power to initiate legislation, would become a real legislative body. Existing political parties and new movements like Diem 25 would have to organize and form alliances across national boundaries, creating European-wide electoral politics to complement political life at the national level.
Under current conditions, few European voters would agree to surrender an iota of sovereignty to Brussels; the track record of the technocrats is too tainted. That’s why the first step is to stabilize Europe and deliver big economic improvements using existing institutions and power. Once that happens, Europe can convene a constitutional assembly to draft a new charter for the continent.
In today’s West, Varoufakis said, “authoritarianism and incompetence feed off each other.” With existing approaches discredited, he believes Europeans will be receptive to a federal, democratic blueprint to fix the continent — but it only can work if it wins legitimacy at the ballot box.
“We leftists and liberals whose illusions were incinerated — can get together to stop creeping neo-fascism,” Varoufakis said. “Even though we are radicals, we don’t want to see a disintegration of the EU because of all the great things it has brought — peace being the greatest of them.”
Although anti-Americanism has long been in vogue for much of the European left, there is a strong American flavor to the whole European project. Varoufakis unapologetically praises and borrows from what he thinks is most valuable in the American democratic tradition. It was American pressure, vision, defense, and money that created modern Europe in the first place.
THERE ARE countless hurdles to a reform agenda for Europe. Since the 1950s, efforts to democratize decision-making, or implement real shared sovereignty across national borders, have foundered because member governments, and sometimes their citizens, are loath to shift power to international bodies.
“This idea of the disconnect between elites and the population is widespread,” said Susi Dennison, a senior fellow at the European Council on Foreign Relations who studies efforts to reform the EU.
Some proposals have gained mainstream momentum, she said, including the plan to create some new European parliament seats that are elected by continent-wide votes, and to make the European Commission and presidency more directly tied to elections.
But nationalist sentiment remains strong, as does resistance to the fundamental idea of the EU, she said. As Brexit showed, not that many voters care about the idea that the EU is an effective insurance policy against continental war — even if it’s true. Over time, Dennison said, she fears that even well-meaning reform efforts will appear to the public as nothing more than added layers of bureaucracy, and the European project will lose what little value it retains in the eyes of the public.
“I don’t think it will collapse tomorrow, but there’s a very real risk,” she said.
The slow-boil crises of the last decade have altered the landscape throughout the United States and Europe, with anti-immigrant right-wing groups an established part of the political power structure. For the latter half of the 20th century, Western electorates might have come to see war as a risk only for faraway, far less fortunate countries. But the tensions that have erupted since 2008 serve as a reminder that the West’s democratic peace isn’t a given. It arose from the aftershocks of apocalyptic world war, and took sustained effort to build. Without strong public commitment, it could crumble.
Thanassis Cambanis, a senior fellow at The Century Foundation, is the author of “Once Upon a Revolution: An Egyptian Story.” He is an Ideas columnist and blogs at thanassiscambanis.com.
