There is a high-stakes game of chicken being played in the European Union. Negotiations between the leftist Greek government and the Troika—the European Union, European Central Bank and International Monetary Fund— appear to be at an impasse. Bluffs, counter-bluffs, veiled meetings and rumored deals swirl around the talks. At stake is a simple question: Will the SYRIZA government in Greece obtain a rollback on its debt and the Troika-imposed “austerity” (read: economic torture) program, or will the talks fail and—if SYRIZA does not capitulate—will Greece be forced out of the Eurozone?

The previous program of “assistance” known as the “Memorandum,” whereby the Troika—which owns nearly 80 percent of Greek debt—provided loans to Greece in exchange for a brutal austerity policy, will end Feb. 28.  Greece must then begin paying back its loans. The first payments adding up to 11 billion euros come due between March and August.

SYRIZA attempts to start talks

SYRIZA was elected by the masses of Greek people to roll back the austerity program imposed by the Troika, which has driven the country into poverty and continually humiliated the Greek people. So far, SYRIZA has proposed a set of draft laws for the new parliament to set the tone, pledging to hike the minimum wage, rehire some state sector workers, and grant citizenship to second-generation immigrants. Key pieces of the imposed privatization program—including the proposed sale of a major port in Piraeus—have also been called into question and the entity dealing with them has been scrapped.

These laws should mostly pass, and SYRIZA is clearly counting on votes from the Greek Communist Party (KKE) to make sure they do. The law on citizenship promises to be contentious as it is opposed by SYRIZA’s right-wing coalition partner, the Independent Greeks (ANEL). This law, as well as Prime Minister Alex Tsipras taking his oath from a secular authority, is designed to reassure SYRIZA’s backers that its left-right coalition is based principally on economic matters and that SYRIZA will not retreat on its anti-racist and anti-homophobia planks.

It also suggests that SYRIZA hopes for an undeclared alliance with the KKE on certain measures to either augment the combined SYRIZA-ANEL vote or on contentious social issues bypass ANEL with a vote “of the left.”

That being said, SYRIZA has pronounced itself open to a deal. Finance Minister Yanis Varoufakis even went as far to say Greece would do “whatever it takes” to reach an agreement. The Greek government seeks a deal with three key elements. First would be a six-month bridge loan to cover 7 billion euros in debt payments.

Second would be a refinancing of the debt. SYRIZA has put forward a plan that includes turning some of Greece’s debt into bonds that would become more valuable as the economy grows. At the end of the day, however, the debt refinancing plan would result in a limited amount of debt being essentially forgiven.

Finally, the government proposes to lower the size of the surplus the budget is required to run under the current deal. This would allow Greece to spend more money on social programs and the like.

SYRIZA’s ability to deal is constrained by two main factors. First is the Greek people. Elected to roll back austerity, it will be difficult for SYRIZA to succeed if it cannot deliver significant relief to those who elected them. Currently, polls show that 79 percent support the government’s position. However, SYRIZA, as one leader of the left has pointed out, does not have roots as deep as its current level of electoral support. Although the KKE got a much smaller vote, SYRIZA does not have the same depth in terms of cadre members. Thus, dissatisfaction with the direction of the government could cause SYRIZA’s electoral support to quickly evaporate.

Secondly, SYRIZA as a broad coalition of left-wing forces faces internal constraints. Its leadership core seems to be primarily made up of those who simply want to roll back austerity as a stage to some radical reforms, but only gradually, in stages, and without a fundamental rupture against capitalism. This is clearly expressed by statements made by leading figures including finance minister Varoufakis: “It is the Left’s historical duty, at this particular juncture, to stabilize capitalism.”

Against such sentiments, many in the left wing of SYRIZA want to move out of capitalism and into socialism. Therefore, to keep the party together, SYRIZA will have limited ability to retreat on its broad goals.

SYRIZA’s leaders have shown themselves to be very keen at maneuvering, marshaling support among masses of people around the world who sympathize with the struggle against the violent austerity policies, and enlisting as temporary allies the faction of U.S. capitalism represented by Barack Obama, as well as its counterparts in France, that are looking to a dose of Keynesian stimulus to help Greece along with the ailing world capitalist economy.

The question is: if they cannot make a deal, will SYRIZA blink?

Troika not budging yet

For its part, Greece’s stringent creditors have only talked to SYRIZA but given no ground. The Troika creditors are insisting on the current deal whereby the money for loan payments is provided in return for continued austerity. The Troika is also facing internal division as well as outside pressure from the United States, which effectively controls the IMF. The only real element of compromise that has emerged from the Troika is the potential for Greece to run a slightly smaller surplus in exchange for continued loans. There is also the possibility of an extension of the Feb. 28 deadline to allow for further talks.

The actual cost of the Greek debt could be handled by the Troika without difficulty. For the creditors, the precedent is more important than the money. The real issue is if Greek gets a deal, then other countries like Spain and Ireland will want a break on the terms of their agreements, culminating in a major cost for the financial oligarchy that is profiting enormously off of the current policies. Moreover, success for SYRIZA could easily bring similar governments to power in Spain and Ireland led by PODEMOS and Sinn Fein, respectively, and a populist groundswell across Europe.

If the Troika refuses to deal, then the most likely outcome is default and exit from the Eurozone for Greece. While many have noted that economically this might not cost the EU much, the political dimensions of such an exit could be huge. Given the dramatic turmoil this would cause inside Greece, the government would have to pursue radical measures to maintain stability and basic living standards, radical enough to at least call into question the future of Greek capitalism—inaugurating an entirely new stage of pitched class struggle.

In Greece, where there have been coups, military dictatorships and civil wars, all within roughly the past 70 years, the unknowns of a Greek exit from the Eurozone, and what it would say for the EU project as a whole, provides a strong stimulus for the ruling classes to make a deal.

Uncertain outcomes ahead

The possibility of an extension of talks means the inevitable showdown could be delayed past Feb. 28. Either way, the main question that remains is who is bluffing and who is not. The Troika still has a key weapon in the payments the European Central Bank is making to keep the Greek banking sector afloat. SYRIZA also has a strong card to play as a representative of an organized, increasingly angry mass people’s anti-austerity movement. It also can voice opposition to the sanctions on Russia, and possibly emerge as a Russian strategic partner, breaching the containment regime pursued by the EU and NATO.

Either way there will likely be more negotiating and posturing before the decisive showdown.