The outcome of Greece's referendum represents a personal triumph for Prime Minister Alexis Tsipras and a political victory for his Syriza party. He galvanized and consolidated his political base, and potentially even expanded it. However, the poll results also marked a loss for Greece.
The referendum clearly fell short of European and international standards. It was based on a vaguely convoluted question, designed to favor the "no" vote and referring to a deal that does not exist. All achieved within one week. No time for public discussion or rational analysis.
Furthermore, Tsipras polarized society in ways not seen since the dark years of the military junta and Greek civil war. He actively pitted citizens who have nothing to lose against those struggling to retain whatever they have left. His fiery rhetoric may have provided hope and bolster national pride, but it also effectively played upon emotions to gain votes. Had the vote posed a more direct "in-or-out of the Euro" question with sufficient time and proper debate, a different result may have prevailed.
For now, Tsipras' game of brinkmanship with Europe, and creditors, resumes with another offer from Syriza. Both sides have dug in their heels and will struggle to backtrack. Imbued with a sense of popular mandate, Tsipras will attempt to use this leverage to extract concessions from European leaders. Unless intently aiming for Grexit, he must exercise caution, avoid overplaying his hand and manage his expectations accordingly. He should be amenable to any modest concessions offered and spin it to his advantage at home.
Other European states, including Spain, Portugal and Ireland that put up with austerity measures remain just as resolute, if not more, than Germany. From their perspective, after all their sacrifices it would be wrong to reward Greece. It would establish the wrong precedent and embolden their own domestic populist parties, particularly in Spain with national elections at year's end. Spain's mainstream parties face considerable challenges from insurgent movements.
Barring a last-minute deal or third bailout, the window of opportunity is narrowing and the Grexit door closing. On July 20th, over 3.5 billion euros is due to the European Central Bank. Furthermore, the IMF can exercise its discretion to declare Greece in default at any time, triggering a vicious downward economic spiral. Despite, the resignation of controversial finance minister, Yanis Veroufakis, the negotiating environment with creditors is more hostile than ever. The lack of trust further complicates current talks and potential future dialogue.
The referendum outcome was also a huge blow for Greece's pro-Europe parties, and particularly for the center-right New Democracy (ND). Upon resigning as ND leader after the poll, former prime minister Antonis Samaras admitted his party needs a new start. His departure was long overdue. It should have occurred immediately after ND's election defeat to Syriza in late January 2015. During the past six months, Samaras' leadership has deprived ND of the opportunity for renewal and seizing any form of political initiative.
A realignment of Greece's pro-Europe centrist parties into a broader, disciplined and effective opposition is also long overdue. Any personality clashes among their leaders must be overcome. If needed, individuals engaging in such futile activities must be sidelined for the sake of greater unity.
Syriza emerged as an amalgamation of leftist parties heavily emphasizing class struggle and the politics of victimization and conspiracy. Its state-centric economic remedies will do little to improve Greece's financial woes. They represent a blast to an inefficient past.
On the other hand, a new centrist Hellenic alliance for Europe must emphasize economic growth through private sector initiative and results-oriented government through transparency and anti-corruption, particularly in the public sector.
Considerable focus must be on rooting out the rent-seekers, that is, those serving the state in pursuit of personal benefit and gain. Whereas Syriza ("coalition" in Greek) represents ideological dialectic and polarization, the alliance ("symmachia" in Greek) should emphasize solutions and national unity.