Financial Times: Pre-Election Period Threatens Greece’s Stability

Financial Times: Pre-Election Period Threatens Greece’s Stability

    by -

    The pre-election period threatens Greece’s stability, says an article in Financial Times.

    Thieves And Traitors 

    The credibility of Greece’s political class has sunk so low that both main parties of the centre right and centre left have faced problems finding suitable candidates to stand for election early next month. Politicians are widely denounced as “thieves and traitors,” reflecting a populist view that their corrupt practices while in government were responsible for triggering Greece’s financial collapse. One veteran political organizer for New Democracy, the conservative frontrunner, said “the pool of potential candidates [for both main parties] has shrunk, especially in the provinces.”

    “There are fewer people than usual aspiring to run,” said a senior member of PASOK, the Panhellenic Socialist Movement that is in coalition with the centre right, under technocrat prime minister Lucas Papademos.

    Voters Set To Back Small Opposition Parties  

    Campaigning has already started for an election expected to take place on May 6, even though the date will not be officially announced until midweek after parliament has approved another package of structural measures. Opinion polls over the weekend showed PASOK and New Democracy would together capture only 40-41 percent of the vote, well short of the 50 percent seen as critical for maintaining the reform process. International lenders are counting on Evangelos Venizelos and Antonis Samaras to renew their coalition after the election with the aim of hauling the country out of recession by the end of 2013. But the majority of voters appear set to back half a dozen small opposition parties that oppose the reform effort, from the Greek Communist party to the far-right Chrysi Avgi (Golden Dawn).

    Venizelos is struggling to win back dissatisfied socialists and also gain support from swing voters in the centre, while New Democracy has been hard hit by the defection of Panos Kammenos, a popular backbencher. Kammenos’s new Independent Greeks party, which opposes further reforms, could capture as much as 10 percent of the vote. The backlash reflects a popular protest against the impact of austerity: cuts of 25 percent in wages and pensions, an unemployment rate above 20 percent and a further 5 percent contraction of national output projected for this year.

    More Austerity Measures On The Way 

    More hardship looms as the incoming government must legislate €11bn of additional spending cuts by July under the terms of Greece’s second €174bn bailout by the European Union and International Monetary Fund, or risk plunging Greece into a full-scale default within months. The coalition government has already pushed through €3.3bn of cuts despite defections by backbenchers from both parties. But Papademos has been struggling in the final days of his administration to prevent coalition deputies from pushing through populist amendments aimed at attracting votes, even though they would undermine the government’s achievements.

    George Kyrtsos, a political commentator, said “the discipline of the past months has weakened and Mr. Papademos is being sidelined as lawmakers from both parties try to enhance their electoral appeal.” Sunday, Venizelos urged voters to back the further austerity measures at next month’s elections or risk the possibility of a forced exit from the eurozone. The former finance minister said in a newspaper interview that the country faced a stark choice: “People must realize the elections are not a big opinion poll but a time for making decisions … Our future is tied to [implementing] the new measures.”

    Whoever Wins Greece Is looking At Instability 

    With the electoral system heavily weighted in favor of the front-running party, New Democracy and PASOK could still scrape an overall majority in parliament with about 45 percent of the vote, according to pollsters. “There is a lot of volatility in the polls and it’s likely that the mainstream parties will both win back more of their core voters during the course of the campaign,” a senior socialist party member said.

    But even if a new cross-party coalition comes to power next month, its tenure may be short-lived. “The polls show that the next government will be in a weaker position than its predecessor. Whatever happens next, we are looking at instability,” Kyrtsos added.
    (Source: Financial Times)