Yanis Varoufakis: Only Europe's Radicals Can Save the EU

26/04/2016_Podemos Pablo Iglesias
Podemos leader Pablo Iglesias in Madrid, Spain, April 26. Did Podemos struggle to break through because they lacked a European strategy? Juan Medina/Reuters

Spaniards went to the polls three days after the shock of Brexit to produce a result that, ostensibly, delivers victory to the status quo. However, the status quo is tired, fragmenting, and prone to vicious unraveling unless the EU's deconstruction is impeded.

But, the Spanish establishment, which is determined to maintain the status quo, lacks both the analytical power and the political will to impede the EU's disintegration. And so an electoral result in favor of continuity becomes the harbinger of deep uncertainty.

Reeling under the British voters' radical verdict, "official" Europe took solace from Spain's general election outcome. They read into it evidence that the post-Brexit fear factor may help knock some "sense" into voters, putting them off "populist" parties. But, even if this is so, for how long will fear keep voters loyal to a crumbling status quo? The threat of a pyrrhic victory for Spain's establishment is, thus, clear and present.

Spain and the U.K. differ in one crucial sense. While EU policies and institutions have damaged the Spanish economy a great deal more than Britain's, Spain's political system remains largely free of euroskepticism. The paradox dissolves quickly when one considers the traditional lack of legitimacy of the Spanish elites in their own country.

British Tories, like Michael Gove and Boris Johnson, knew they could draw mass support from a slogan like "We want our country back!" The Spanish establishment cannot do this. And they cannot do it because, over the last four decades, they managed to retain control by offering voters an unlikely deal: "You keep us in government and we shall do what is necessary to rid you of us, by transferring power to Brussels and to Frankfurt." Calling for a restoration of sovereignty now would strike Spanish voters as backtracking on the promise to rid them of their local rulers. But, then again, this promise is under increasing strain at a time when the process of Europeanization is in serious trouble.

Spain's establishment is in a bind. To stay in power it must continue with the narrative of Europeanization and of continual transfers of authority away from itself toward the EU's technocracy. At the same time, however, it is clear to a majority of the Spanish citizenry that the EU's technocracy has lost the plot, has inflicted upon the European periphery unnecessary recession, has lost the support of a large majority of Europeans, and is now losing control of important EU realms, like the U.K.

One strategy the establishment used in the run up to the recent election was denial based on a Panglossian interpretation of the state of play. Prime Minister Mariano Rajoy's government has been repeating ad infinitum "good news" stories, which say austerity and the removal of workers' protections have put Spain back on the slow but sure road to recovery. A second strategy was employed based on "project fear" and the "Tsipras card"—in other words, the ad nauseum recapitulation of the warning that, if the radical Podemos party (the nascent progressive party that grew out of the demonstrations and occupations against austerity and its discontents) were to enter government, Spain would become another Greece.

Neither of these strategies worked in the general election of last December, giving rise to a hung parliament, failure to form a coalition government and, thus, to the most recent election. With the shock of Brexit only three days before, opinion pollsters have an excuse for their major predictive failure: Podemos finished third rather than in a predicted second place.

Since the inconclusive December 2015 election, Podemos had struck a valuable alliance with Izquierda Unida, the traditional United Left party which was meant to bring to Podemos its loyal one million votes, thus helping the party overtake PSOE, the much diminished social democrats. Alas, Brexit put paid to those hopes and forecasts. The reason why Brexit helped PSOE pip Podemos at the post was very, very simple: the theme of Europe's disintegration entered the election campaign with a bang, with three days to go until Spain voted.

Brexit benefited the two parties supporting the status quo because the fear it inspired made parties proposing a "steady as she goes" course more appealing. The one party that was proposing a new course for Spain and for Europe, Podemos, was the one from which voters demanded a clear European agenda: a convincing set of policies that could be implemented realistically using existing EU institutions to end austerity, boost growth, and allow Podemos to govern according to its program.

None of the three major parties (Popular Party, PSOE or Podemos) offered the electorate a convincing European agenda into which they would nest their domestic policies. The Popular Party promised to secure permission to bend the EU's rules, in exchange for subservience to Brussels. PSOE argued that they could do this better than the Popular Party. And Podemos relied on vague, heart-warming, references to the possibility of "another" Europe.

Podemos, just like the other two parties, was hoping that voters would concentrate on domestic affairs, and not notice its lack of a European agenda. Brexit blew this hope out of the water, sending many former PSOE voters back to PSOE and thus annulling Podemos' gains from its alliance with Izquierda Unida.

In my earlier commentary for Newsweek before the U.K. referendum and the Spanish general election, I had concluded that:

"Europe is on the brink and our Union is disintegrating as a result of a pernicious mixture of authoritarianism and bad policy. Spain can change this. But to do so, Podemos must rise on the back of an appealing European agenda."

Podemos' error was to go to the people without such an agenda. The dispiriting third place was the price it paid. It was also a blow for Europe to the extent that Brussels, Frankfurt and Berlin now see the outcome as a sign that business-as-usual remains an option.

Continuity, however, is unfeasible and so the pro-status quo Spanish result becomes a harbinger of deep uncertainty throughout Europe. The EU is at a point when radical progressives, like Podemos, are its only hope for survival. It is important that it, along with all European progressives, embraces a slogan similar, but also very different, to that of the Brexiters: "We want our Europe back!"

The good news is that Podemos has now solidified its position as a major political force. Its ranks are filled with local government figures—such as Ada Colau, the Mayor of Barcelona—who have hands-on experience of converting a protest movement agenda into practical, innovative government.

The only missing ingredient is a progressive Europeanist agenda of the type that DiEM25 is working to build from the ground up throughout Europe.

Yanis Varoufakis is the Co-founder of DiEM2025, the Democracy in Europe Movement. Follow him on Twitter @yanisvaroufakis