ATHENS – With the posting of a bill on the Parliament wall, elections to choose a new leader for Greece have been set for May 6. Polls show the two parties that have long dominated the country – PASOK’s Socialists and New Democracy’s Conservatives – are sliding because of their support to crush austerity measures and the country is facing the likelihood of another coalition to replace a current temporary government, or yet another election.
Interim Prime Minister Lucas Papademos met with President Karolos Papoulias to get the formal approval for the date. Papademos, a technocrat and former European Central Bank (ECB) Vice-President, was appointed on Nov. 11, 2011 after Prime Minister George Papandreou resigned in the face of incessant protests, riots and strikes against austerity measures imposed to get a $152 billion from the Troika of the European Union-International Monetary Fund-ECB. Papademos engineered a second bailout of $173 billion but that came with more of the pay cuts, tax hikes, slashed pensions, and with additional measures of firing 150,000 state workers over the next three years, infuriating Greek society. Greece also imposed losses of 74 percent on investors to write down $134 billion in debt under Papademos’ watch.
“The main goals of our government were achieved,” he said. “We are obliged as a government to hand the baton to the government that will come from the next elections.”
He warned, however, that whoever wins will not be able to undo the austerity and will have the burden of cutting another $14.4 billion in state spending. Parliament dissolved without acting on other key measures demanded by the Troika, such as opening closed professions that enjoy monopolies or speeding the pace of privatizing state-owned enterprises and selling or leasing state-owned lands to raise more cash. He said his work was essentially done. Papademos stated, “From these choices, we won’t only decide which government will be formed for the next elections. The course of Greece will be decided for the following decades. Our decisions must not point to yesterday but tomorrow, toward the building of a better future for all of us. He added, “We avoided the immediate danger of bankruptcy and created the best possible conditions for the continued efforts needed for the reorganization of the state and a renewed financial stability, while also restoring the competitiveness of the economy,” although many analysts said Greece remains uncompetitive, is staggering under $460 billion in debt and will take a decade to recover and has locked itself out of the markets with the deal imposing losses on investors.
With Easter on April 15, politicians will have only several weeks to seek votes and persuade voters on their platforms, but campaigning was already underway even before the date was set. PASOK’s new leader Evangelos Venizelos said he expects to play a leading role in any coalition although his party has only 10-15 percent in the polls, and New Democracy’s Antonis Samaras, whose party is leading, said he doesn’t want a coalition.
“I am entering the field, just as all big teams do…to win. Not to get a tie, not to lose,” Samaras told Mega TV. “And if a government cannot be formed…we will have to go again to elections.”
Greece’s political system has been fragmented by two years of bitter political battles over the pay cuts, tax hikes, slashed pensions and plans to fire 150,000 workers as a condition of getting $325 billion in rescue loans from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB). Anti-bailout parties have been rising in support, undercutting the traditional dominance of PASOK and New Democracy.
“In the period before May 6, this government is obliged to take important decisions and policies that have already been approved by Parliament, and must be adopted by the time we hand [them] over to the next government,” Papademos said, according to a transcript of his comments. The new Parliament will convene May 17, he added.
Among the measures the Parliament passed before it was set to dissolve was handing the country’s five parties represented in the body some $40 million for campaign purposes, but some reforms demanded by the Troika have not been acted on and the lawmakers said they didn’t have time to consider a bill to help Greek households get debt relief, although the government was going to provide some $64 billion to recapitalize the country’s banks, who are also insisting that customers repay their loans.
The election is the first since PASOK rose to power in 2009 under then-leader George Papandreou, who said he discovered New Democracy had left him a bankrupt country and as EU officials found the Conservatives had lied about the economy’s condition. Under pressure, Papandreou implemented the austerity measures but was forced to resign on Nov. 11, 2011 after incessant protests, riots and strikes, leading to the current shaky New Democracy-PASOK government under Papademos.
The latest survey, released earlier this week, shows that the two ruling parties would command just 32.4% of votes, while six other parties would also be represented in Parliament. Under pressure to implement more reforms, Greece’s cabinet will continue to meet in coming weeks to decide on issues that don’t have to be passed through Parliament, which essentially has just been used to rubber stamp decisions reached by the government as minority parties don’t have enough seats to override legislation of which they don’t approve. The Cabinet is expected to act on recapitalizing the banks who otherwise would face nationalization.
Even before Papademos said the election date had been set, Samaras set the tone for what’s likely to be bitter campaigning when he rejected the idea of forming another coalition government. He has the task of convincing voters to support him even though he originally opposed austerity, then supported it to be part of the current coalition, but said he wants to renegotiate it, an idea rejected by the Troika. While Samaras supported the continuation of austerity, he also said he wants tax cuts, also rejected by the Troika which said it would discontinue bailout loans if the next government tried to renege on its deals, which included imposing 74 percent losses on investors to give Greece a $134 billion debt write-down.
“Greece can make it, we can do things differently,” Samaras said, but didn’t offer any ideas on how other than to say he would try to “untie” Greece’s hands from the bailout terms he supports. He pledged to boost low pensions he allowed to be cut, create jobs in an economy with 21 percent unemployment, and compensate small bondholders who were forced to take losses in the debt write-down even though many were from the Diaspora and had bought Greek bonds to support their homeland.
The bombastic Venizelos, who as Finance Minister doubled income and property taxes and taxed the poor, said he expected to be a player in the next government if it’s a coalition despite his party’s low standing. He also urged voters to give PASOK an outright win so he could rule alone, although he faces the tough task of persuading voters to support the man who has cut their pay, raised their taxes, slashed their pensions and wants many of them fired.
“We want victory in the elections. That means we want to come first and have a decisive role in developments so we can rally the forces that will tackle the crisis,” Venizelos said. He admitted his party was guilty of “mistakes,” “erroneous assessments,” “delays” and “a lack of courage of speed.” He criticized Samaras for having an “equivocal stance, reminiscent of old-style politics,” and of “hiding behind” PASOK during negotiations with foreign creditors.
Declaring that Greece is “two-thirds of the way to exiting the crisis,” Venizelos also highlighted five priorities: seeking the extension of the country’s rescue program to the end of 2015, taking advantage of the debt write-down, completing the recapitalization of banks, increasing the absorption of EU funding and speeding up privatizations, and protecting those on low incomes, although he taxed those making as little as $6,700 a year.
Further adding to public anger at Greek politicians, but just in time for the elections, former Defense Minister Akis Tsohatzopoulos, 72, a founding member of the PASOK party in 1974, was arrested on money laundering charges. He has been tied to a number of scandals involving bribe taking, including those involving a German submarine.
(With information from: Kathimerini, ANA)
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