Austerity is bad but bankruptcy is 'much worse,' says Greece's top spokesman, Lefteris Kretsos

Many Greeks felt betrayed when Prime Minister Alexis Tsipras and Greece's parliament grudgingly approved austerity measures imposed by the European Union in exchange for another bailout package.

Tsipras's Syriza party came to power in January on an anti-austerity platform. In early July, the government organized a referendum conceived to strengthen its hand in negotiations with Europe's bankers over the repayment of its debt.

More than 60 per cent of Greeks voted in favour of not enacting further austerity measures.

Yet Tsipras came home with his tail between his legs, after the European Union forced Greece to accept even stricter financial constraints than originally planned.

Lefteris Kretsos, the Greek government's communications chief and the man charged with justifying the deal to his fellow Greeks, understands why his fellow citizens might feel let down, or even sold out, by Syriza.

"The deal is not great for an anti-austerity party like Syriza, but it was the best we could do," says Kretsos, during an interview with CBC Radio's The Sunday Edition.

According to Kretsos, not accepting the austerity measures would have meant leaving the eurozone, bankruptcy and an even bleaker future for Greece.

"We didn't have an alternative, because bankruptcy is a much worse scenario than any type of austerity," says Kretsos.

The Greek politician outlines the reasons why the deal went down the way it did.

"First, we don't have an efficient and effective public administration to deal with emergencies. Secondly, the Greek people were not informed about what a transition to a new currency means.

"Thirdly, we did not have enough reserves in our banks to sustain them. And finally, we did not have support from other economic blocs or countries that could sustain Greece in the midterm or in the case of going back" to the country's previous currency, the drachma.

Syriza still against austerity

Mr. Kretsos admits that had Russia or China extended a helping hand to Greece, the country might have seriously considered a "Grexit."

He also believes that Greece was manhandled by the European Central Bank, the European Commission and the International Monetary Fund for political reasons.

The election of the Tsipras government marked the first time a staunchly left-wing party has taken power in Europe since 1989.

Kretsos argues that the ongoing confrontation between Greece and the EU, and the harshness of the austerity package imposed upon his country, has more to do with political ideology than with sound economics.

"If we really want to protect working class people, we have to continue to fight against austerity inside the eurozone. The political balance of power at this moment is asymmetrical," he says.

He believes the debate in recent weeks has cast doubt on the wisdom of the austerity policies of German finance minister Wolfgang Schaeuble, "even inside Germany."

Kretsos also alleges that some conservative elements in Europe's financial establishment don't actually want Greece to pay back its debt.

He charges that they'd rather see the country go bankrupt and then swoop in to buy Greece's assets at fire sale prices.

Eliminating tax evasion

The immediate task facing Syriza, he says, is putting the country back on its feet when it's riddled with debt and unemployment, has little industry aside from tourism and suffers from a lack of effective institutions.

"Let's be honest," Kretsos says, "we have to make specific progressive reforms in Greece. We have to eliminate tax evasion and we have to fight Greek elites who haven't paid their share in this crisis."

At the same time, Kretsos says Greece has won a moral victory in forcing people to critically re-evaluate the EU's response to the debt crisis.

"For the first time, many people understood that the real problem with the Greek debt was not some anthropological analysis that Greek people are lazy, but that the real problem was this dogmatic concentration on austerity policies that destroy the tradition of social Europe."

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Also on this week's episode of The Sunday Edition, with guest host Francine Pelletier:

• Sitting is the new smoking: It's something we all do for hours at a time -- and it is hazardous to our health. Michael Enright talks with author and business innovator Nilofer Merchant, whose TED talk, "Got a Meeting? Take a Walk?" has been watched more than two million times.
• Utopia on the prairie: The small farming community of Palmer, Sask. is being brought back to life by a group of young people who want no part of big-city striving.
• Amy Winehouse: On the fourth anniversary of her death, a new documentary film about the brilliant singer/songwriter is on screens across the country. We reprise Robert Harris's portrait of Winehouse.

The Sunday Edition airs on CBC Radio 1 just after the 9 a.m. ET news.