Portugal holds first post-bailout elections

António Costa, the popular former mayor of Lisbon, campaigns earlier this week. (Facebook)

Portugal might be the only place in crisis-plagued Europe where politics still feel like they’re stuck in the year 2000.portugal flag

There’s no virulent anti-austerity party like Podemos (the far-left movement of indignados in neighboring Spain) or the plucky SYRIZA of Greek prime minister Alexis Tspiras.

There’s no citizen’s movement of the kind that powers Beppe Grillo’s Five-Star Movement in Italy or Czech finance minister and businessman Andrej Babiš’s ANO.

There’s no anti-EU group like Nigel Farage’s UKIP or the eurosceptic Alternative for Germany.

There’s not even an anti-immigrant force like the far-right parties of Scandinavia or Marine Le Pen’s Front national in France.

It’s still a country that only last year returned to GDP growth after four years of recession in the past half-decade, a country with a 13% unemployment rate, a country that has hemorrhaged hundreds of thousands of educated graduates to jobs elsewhere in Europe and the Lusophone world. Portugal concluded its €78 billion bailout in May 2014 ahead of schedule (and without needing a second bailout) after a program of income tax and VAT increases and cuts to social spending, wages, benefits, unemployment benefits and public-sector jobs.

Still, no one seems incredibly angry in Portugal about any of this.

Portuguese prime minister Pedro Passos Coelho and his deputy and foreign minister, Paulo Portas, campaign for reelection for their center-right government. (Facebook)
Portuguese prime minister Pedro Passos Coelho and his deputy and foreign minister, Paulo Portas, campaign for reelection for their center-right government. (Facebook)

That’s perhaps one reason why the current center-right government, headed by prime minister Pedro Passos Coelho, has such a good chance of at winning reelection on October 4, when voters will elect the 230 members of Portugal’s unicameral Assembleia da República (Assembly of the Republic).  Polls show that his center-right electoral coalition, anchored by the Partido Social Democrata (PSD, Social Democratic Party), will win the largest share of the vote. That’s probably only because Passos Coelho was smart enough to join forces with his junior governing partner, the more socially conservative Centro Democrático e Social – Partido Popular (CDS-PP, Democratic and Social Center — People’s Party).

Together, the coalition now holds a narrow lead over the opposition center-left Partido Socialista (PS, Socialist Party), led by the charismatic former mayor of the Portuguese capital of Lisbon, António Costa, who has served as a minister in several administrations, most recently as interior minister in the cabinet of now-disgraced former prime minister José Sócrates.

Although the forces of the united Portuguese right will likely fall far short of their 2011 electoral victory, the Socialists will likewise not achieve the same clear victory of the 2009 election. While that means the newly united Portuguese right is favored to win a narrow victory, it also means that no single party will have a majority in the National Assembly.

Another explanation for the election’s conundrums?

No one really cares. Since 2005, when turnout peaked at a 20-year high of 64.3%, participation has trended downward to the lowest in Portuguese electoral history (58.1%) in the 2011 elections and could sink even lower on October 4. That’s not even counting the nearly half-million legion of Portuguese émigrés who have left, maybe permanently, for better opportunities in far-flung locations, from Angola to Frankfurt and from Mozambique to London.

Though Passos Coehlo’s center-right coalition government implemented the terms of the bailout agreement, it was the previous Socialist government that initially asked for the bailout four years ago. That government’s decision actually led to early elections in 2011, and it was only at the last moment that Portuguese voters swung to the center-right. Since taking control of the Socialist Party late last year, Costa has positioned it ever leftwards by adopting a far harsher anti-austerity tone. But the fact remains that both major Portuguese parties bought into the bailout — with eyes wide open, the Socialists requested it and, with eyes wide open, the Social Democrats enacted it.

But it hasn’t been a great four years for the Socialists in opposition. Sócrates was arrested on charges of corruption and tax evasion and imprisoned for nearly 11 months pending trial (he’s still under house arrest). Though he stepped down after losing the 2011 election, his immediate successor, António José Seguro, proved something of a dud, easily losing the September 2014 primary to Costa. Sócrates’s corruption trial, unfortunately for Costa and the Socialists, hangs over the election like a stale ghost.

Despite Passos Coehlo’s satisfaction that the economy is much improved since his government began in 2011, there’s a sense that not all is well in Portugal. It’s a country where Angolan capital is assiduously courted, despite less-than-savory governance standards in Portugal’s oil-rich former colony. Mild GDP growth returned last year after three years of consecutive contraction and committed fiscal tightening. But it wasn’t without serious doubts, even at the heart of the Passos Coehlo government. His first finance minister, Vítor Gaspar, resigned in the summer of 2013, precipitating a crisis that resulted in the (short-lived) resignation of foreign minister Paulo Portas, the leader of the government’s junior partner, the CDS-PP, and a canny politician who sensed, if briefly, the wave of anti-austerity discontent.

Today, however, GDP growth is now expected to grow to around 1.5%, and the center-right alliance could yet reap the benefit from that upward trajectory. It has, nevertheless, been 15 years since the country’s annual growth topped just 3%. With so much young talent leaving, there’s a risk that Portugal will never be able to balance its heavy debt with its social welfare obligations. As the most talented Portuguese workers continue to look abroad to build careers, it will increasingly deprive the country of revenue all while proportionately increasing the numbers of those who are less skilled, retired, elderly, or other workers displaced by economic crisis, all of whom may be more likely in need of public services. Lacking an unforeseen baby boom or a rush of new immigrants (perhaps from Lusophone countries like Angola or Brazil), total population will decline over the course of the 21st century, placing additional strain on the national government’s treasury.

Neither major party really has much of an answer to Portugal’s long-term dilemma, though there’s no doubt that the past decade has borne closer ties with Portugal’s former colonies.  This time, it’s the empire that’s growing ever dependent on the social and financial investment of its one-time colonies.

Both candidates have non-traditional ties to the Lusophone world. Passos Coehlo spent his childhood years in Angola, where his father António practiced medicine until the country gained independence in 1975. Today, Passos Coehlo’s second wife, the 50-year-old Laura Ferreira, is a physiotherapist originally from Guinea-Bissau, a former west African Portuguese colony (and is valiantly fighting bone cancer). Costa is the son of an Indian writer, Orlando da Costa, who spent his childhood in Goa, at the time another Portuguese colonial holding.

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