Tag Archives: samaras

Greece

Cracking down on Golden Dawn’s leadership is a risky strategy for the Greek government

Leave a comment

michaloliakos

Over the course of the past week, the Greek government stepped up its efforts to treat Greece’s hard-right, neo-fascist party, Golden Dawn (Χρυσή Αυγή) with the kind of speed and clarity that one rarely sees in Athens.Greece Flag Icon

Those efforts follow the stabbing of anti-fascist hip-hop artist Pavlos Fyssas over a week ago, which marked a turning point for the coalition government that center-right prime minister Antonis Samaras leads.  Greek authorities over the weekend arrested Golden Dawn’s leader Nikos Michaloliakos (pictured above) and other party members, including party spokesman Ilias Kassidiairis, on charges of belonging to a criminal organization.  It was an unprecedented action in Greece’s post-dictatorship democracy — the first time since 1974 that MPs, let alone a party head, were arrested.

But things took an awkward turn on Wednesday when three of the Golden Dawn MPs (but not Michaloliakos) arrested were released pending trial, adding to doubts that Samaras’s government is making the right choice in suddenly treating Golden Dawn as more of a criminal organization than a political organization, however vile its organizing beliefs.  Kassidiaris (more on him here) did himself no favors by kicking and pushing members of the media upon his release Wednesday.

Support was already crashing for Golden Dawn in the wake of the murder — the party dropped from winning around 13% support in polls to just around 6% or 7% last week in the aftermath of the Fyssas murder.  In real terms, that means that Golden Dawn would no longer be the third-largest party if elections were held in Greece tomorrow.  After winning 6.92% in the previous June 2012 elections, Golden Dawn currently holds 18 seats in the 300-seat Hellenic Parliament (Βουλή των Ελλήνων), and the party had been threatening to resign en masse, leading to distracting by-elections.  Golden Dawn, which began as a ‘nationalist socialist’ magazine in 1980, comprised mostly of misfit supporters of the right-wing military junta that ruled Greece between 1967 and 1974, was a very minor presence in Greek political life before — until Greece’s economy plunged into contraction, unemployment, misery and social discord over the past four years.  (Read more background on the group’s history here.)

If you want to understand why Golden Dawn’s popularity has ballooned, check out the trajectory of the Greek economy from growth to severe depression over the past seven years:

greecegdpGolden Dawn was already growing into something more than a political party — a mutual aid society to provide food and other necessities (but only, of course, to ‘pure’ Greeks) and a near-paramilitary outfit that drew, according to some Greek analysts, the support of 50% of the Greek police forces.

But Golden Dawn’s polling collapse was, even before the crackdown, good news for Samaras — right-wing voters who had flirted with Golden Dawn seemed to be returning to Samaras’s more conventional conservative New Democracy (Νέα Δημοκρατία), which has boosted it once again over the anti-austerity, leftist SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς).  Before the latest drama in Greece, SYRIZA had eclipsed New Democracy in many polls, even as Greece faces the humiliating prospect of requesting a third bailout from the ‘troika’ of the European Central Bank, the European Commission and the International Monetary Fund.

So why would Samaras make this push now?  His sudden aggressive tack against Golden Dawn comes with the risk that Samaras will transform Michaloliakos and his party into martyrs, thereby boosting their support when they might have otherwise faded away as Greeks backed away from a group with such openly neo-Nazi leanings. Continue reading Cracking down on Golden Dawn’s leadership is a risky strategy for the Greek government →

Germany, Greece

What kind of a deal can Greece expect after the German elections?

1 Comment

merkelsamaras

Europe may be a non-issue in the German election campaign, but it’s becoming increasingly clear that Europe will occupy a chief role in the agenda of Germany’s next chancellor, perhaps more so than exclusively German domestic issues.Greece Flag IconGermany Flag Icon

Though center-right chancellor Angela Merkel and center-left challenger Peer Steinbrück are both stridently pro-Europe, it’s an open question how to next German government should deal with the poster-child of the European financial crisis — Greece.  To understand Germany’s options requires an understanding of the underlying Greek politics — and how a Greek political crisis could plunge the entire eurozone back into panic mode.

Even as Germany and the eurozone as a whole pulls out of the worst of the most recent recession, Greece continues to struggle with economic contraction.  The economy is set to shrink by between 4.5% to 5% this year, the unemployment rate is a staggering 27.6%, and this follows five consecutive years of recession capped off by a 7.1% contraction in 2011 and 6.4% contraction last year.  Greece remains trapped in a grueling internal devaluation where the private sector is being forced to accept leaner wages to make exports more competitive and the public sector is being forcibly downsized by the terms of the bailout programs agreed to by the ‘troika’ of the European Central Bank, the European Commission and the International Monetary Fund.  Greece today is not a fun place to live, and Greek voters are angry at Germany in particular for forcing so many Greeks into poverty and joblessness while doing little in terms of fiscal or monetary policy to boost the country’s medium-term growth prospects.

But German voters have their own narrative — while they’re still generally supportive of ever close union within Europe, they’re nonetheless wary of the European Union becoming a transfer union where wealth from German productivity flows to Greek profligacy.  That underlies the collective angst within the entire Germany political community late last month when Wolfgang Schäuble, Germany’s finance minister, indicated that Greece would require a third bailout — perhaps up to €11 billion, which is still a fraction of what the troika has already lent to Greece.  (For the record, Portugal’s government is also likely to require a second bailout of its own early next summer.)

Back in Greece, that means a politically radioactive set of negotiations at a time when Greece’s government is reeling.  A coalition between the two once-dominant parties since the return of Greek democracy in 1974, the center-right New Democracy (Νέα Δημοκρατία) and the center-left PASOK (Panhellenic Socialist Movement – Πανελλήνιο Σοσιαλιστικό Κίνημα) holds just a cumulative 155 seats, giving it the barest of majorities in Greece’s 300-member Hellenic Parliament.  After the disastrous shutdown of Greece’s public television station ERT in June, the anti-austerity Democratic Left (Δημοκρατική Αριστερά) left the governing coalition — its leader Fotis Kouvelis previously agreed to join the coalition after Greek’s June 2012 elections in order to provide more stability for the country.

Snap elections seem likely in any event sometime next year.  If elections were held today, SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς) seems likeliest to win them, according to a recent poll, making the young, massively anti-austerity opposition leader Alexis Tsipras Greece’s radical new prime minister.  The Sept. 11 Public Issue poll showed SYRIZA moving into first place with 29%, New Democracy with 28%, and the far-right, neo-fascist Golden Dawn (Χρυσή Αυγή) would win 13%.  PASOK, meanwhile, would fall to just 7%, the Greek Communist Party (KKE) would win 6.5%, the right-wing, anti-bailout Independent Greeks would win 5.5%, and the Democratic Left would win just 2.5%, less than the 3% threshold for entering parliament.

SYRIZA has essentially consolidated much of the support of the anti-austerity left, so it’s puzzling how PASOK still attracts even 7% support, given that it’s subjugated itself almost completely  to prime minister Antonis Samaras’s agenda.  But Golden Dawn’s support is rising, and it’s likely to pull support from increasingly frustrated right-wing voters that once supported New Democracy, suggesting that if economic conditions keep deteriorating, Golden Dawn could draw even more support to a largely xenophobic, nationalist agenda.

If those numbers held up in a new Greek election, Merkel and her colleagues in Paris, Brussels and other European capitals, would probably regard it as a disaster for Europe. Continue reading What kind of a deal can Greece expect after the German elections? →

Greece

Kouvelis, Democratic Left withdrawal from Greek government leaves precarious majority

Leave a comment

kovelis

Just a little over a year after the second of two divisive elections in Greece, the smallest partner in the three-party governing coalition withdrew its support today — leaving Greece ever closer to new elections, though the government will continue on with a slim majority for now.Greece Flag Icon

Fotis Kouvelis, in announcing that his party, the Democratic Left (Δημοκρατική Αριστερά), would leave the coalition over the growing row related to the sudden closure of ERT, the national broadcaster, emphasized that Greece did not need new elections, and he indicated that the party would perhaps provide external support to what’s left of prime minister Antonis Samaras’s coalition to keep Greece on track with respect to the terms of its bailout program with the ‘troika’ of the European Commission, the European Central Bank and the International Monetary Fund.

What does that mean for Greece?

Though it’s true that the departure of the Democratic Left doesn’t necessarily mean new elections, it leaves the government in a precarious position.

Samaras’s New Democracy (Νέα Δημοκρατία), Greece’s longstanding center-right party, holds 125 seats in the 300-member Hellenic Parliament (Βουλή των Ελλήνων).  Its other coalition partner, PASOK (Panhellenic Socialist Movement – Πανελλήνιο Σοσιαλιστικό Κίνημα), Greece’s traditional center-left party, holds 28 seats.  Together, that gives the government an ostensible three-seat majority, though the 14 seats that Kouvelis delivered provided a wider margin for comfort over a year that’s seen Samaras’s government push forward with the fiscal adjustments mandated by the bailout program.

But more importantly, Kouvelis (pictured above, left, with Samaras in center background) delivered the votes of one of the two parties of the anti-bailout left, giving Samaras’s government a broader base and a credible claim to being somewhat of a unity government.

The Democratic Left formed only in 2010 when moderates split from the leftist SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς).  So while SYRIZA leader Alexis Tsipras is content to lead the opposition, Kouvelis and his party brought an outsized amount of legitimacy to Samaras’s government.  After all, both New Democracy and PASOK had backed Greece’s bailouts, and many voters have held the two parties, which switched back and forth in power in recent decades, especially responsible for Greece’s economic woes.

Their continued unpopularity is one reason why no one wants to risk elections anytime soon.  PASOK, in particular, has lost nearly all of its support among voters to the benefit of Tsipras and SYRIZA, which have given more muscular voice to the anti-bailout left.  If elections were held tomorrow, it’s not even certain that PASOK would pass the 3% threshold to win seats in the Hellenic Parliament.

One recent poll shows New Democracy holding onto a very narrow lead, with 21% to just 20.5% for SYRIZA.  In third place is the neo-fascist Golden Dawn (Χρυσή Αυγή) with a staggering 10.2%.  Greece’s far-left Communist Party (KKE) registered 5.7%, the center-right (but anti-bailout) Independent Greeks registered 5.2%.  PASOK won just 5.1%, and the Democratic Left won just 4.8%.

With such weak support, neither Samaras nor PASOK leader and former finance minister Evangelos Venizelos have an incentive to trigger new elections.  So while the chances that Greece will go to the polls for the third time in 12 months are slim, there’s no escaping the fact that the Democratic Left’s decision to leave the government is a setback for Samaras.  Continue reading Kouvelis, Democratic Left withdrawal from Greek government leaves precarious majority →

Bulgaria, Cyprus, European Union, France, Germany, Greece, Italy, Spain, United Kingdom

What Iceland’s election tells us about post-crisis European politics

Leave a comment

dusseldorf

Iceland was supposed to be different.Iceland Flag IconEuropean_Union

In allowing its banks to fail, neo-Keynesian economists have argued, Iceland avoided the fate of Ireland, which nationalized its banks and now faces a future with a very large public debt.  By devaluing its currency, the krónur, Iceland avoided the fate of countries like Estonia and others in southern Europe trapped in the eurozone and a one-size-fits all monetary policy, allowing for a rapid return to economic growth and rapidly falling unemployment.  Neoclassical economists counter that Iceland’s currency controls mean that it’s still essentially shut out from foreign investment, and the accompanying inflation has eroded many of the gains of Iceland’s return to GDP growth and, besides, Iceland’s households are still struggling under mortgage and other debt instruments that are linked to inflation or denominated in foreign currencies.

But Iceland’s weekend parliamentary election shows that both schools of economic thought are right.

Elections are rarely won on the slogan, ‘it could have been worse.’ Just ask U.S. president Barack Obama, whose efforts to implement $800 billion in stimulus programs in his first term in office went barely mentioned in his 2012 reelection campaign.

Iceland, as it turns out, is hardly so different at all — and it’s now virtually a case study in an electoral pattern that’s become increasingly pronounced in Europe that began when the 2008 global financial crisis took hold, through the 2010 sovereign debt crisis in the eurozone and through the current European-wide recession that’s seen unemployment rise to the sharpest levels in decades.

Call it the European three-step.

In the first step, a center-right government, like the one led by Sjálfstæðisflokkurinn (Independence Party) in Iceland in 2008, took the blame for the initial crisis.

In the second step, a center-left government, like the one led by Jóhanna Sigurðardóttir and the Samfylkingin (Social Democratic Alliance) in Iceland, replaced it, only to find that it would be forced to implement harsh austerity measures, including budget cuts, tax increases and, in Iceland’s case, even more extreme measures, such as currency controls and inflation-inducing devaluations.  That leads to further voter disenchantment, now with the center-left.

The third step is the return of the initial center-right party (or parties) to power, as the Independence Party and their traditional allies, the Framsóknarflokkurinn (Progressive Party) will do following Iceland’s latest election, at the expense of the more newly discredited center-left.  In addition, with both the mainstream center-left and center-right now associated with economic pain, there’s increasing support for new parties, some of them merely protest vehicles and others sometimes more radical, on both the left and the right.  In Iceland, that means that two new parties, Björt framtíð (Bright Future) and the Píratar (Pirate Party of Iceland) will now hold one-seventh of the seats in Iceland’s Alþingi.

This is essentially what happened last year in Greece, too.  Greece Flag IconIn the first step, Kostas Karamanlis and the center-right New Democracy (Νέα Δημοκρατία) initially took the blame for the initial financial crisis.  In the second step, George Papandreou and the center-left PASOK (Panhellenic Socialist Movement – Πανελλήνιο Σοσιαλιστικό Κίνημα) overwhelming won the October 2009 elections, only to find itself forced to accept a bailout deal with the European Commission, the European Central Bank and the International Monetary Fund.  In the third step, after two grueling rounds of election, Antonis Samaras and New Democracy returned to power in June 2012.

By that time, however, PASOK was so compromised that it was essentially forced into a minor subsidiary role supporting Samaras’s center-right, pro-bailout government.  A more radical leftist force, SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς), led by the young, charismatic Alexis Tsipras, now vies for the lead routinely in polls, and on the far right, the noxious neo-nazi Golden Dawn (Χρυσή Αυγή) now attracts a small, but significant enough portion of the Greek electorate to put it in third place.

The process seems well under way in other countries, too.  In France, for examFrance Flag Iconple, center-right president Nicolas Sarkozy lost reelection in May 2012 amid great hopes for the incoming Parti socialiste (PS, Socialist Party) administration of François Hollande, but his popularity is sinking to ever lower levels as France trudges through its own austerity, and polls show Sarkozy would now lead Hollande if another presidential election were held today.

It’s not just right-left-right, though. The European three-step comes in a different flavor, too: left-right-left, and you can spot the trend in country after country across Europe — richer and poorer, western and eastern, northern and southern. Continue reading What Iceland’s election tells us about post-crisis European politics →

Greece

Tsipras predicts Greek debt haircut after German elections

2 Comments

tsipras2

The great thing about Washington, D.C. is the flow of visitors we see from throughout the world and the relative access to top officials through top-notch organizations such as the Brookings Institution, which hosted Greek opposition leader Alexis Tsipras for a 90-minute session Tuesday.Greece Flag Icon

The beleaguered Greek economy has receded from headlines somewhat since the razor-close election in June 2012 (itself a rerun of an earlier inconclusive vote in May 2012) and since the conclusion of the latest agreement, reached in October 2012, between Greece’s government and the ‘troika’ of the International Monetary Fund, the European Commission and the European Central Bank for the disbursement of cash to the nearly bankrupt Greek government in exchange for €13.5 billion in budget cuts.

Tsipras leads SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς), which finished a very narrow second place to the center-right New Democracy (Νέα Δημοκρατία), whose leader Antonis Samaras, now prime minister, leads a broad pro-bailout coalition.  Although SYRIZA lost the election, it’s the largest anti-austerity force in Greece, and it either leads or ties New Democracy in most polls.

Given that Greece’s unemployment rate keeps increasing (it’s currently around 27%) and it’s entering its sixth consecutive year of economic contraction, even as the government’s been forced into adopting increasingly harsh austerity measures, it’s hard not to see Tsipras as a future prime minister.

Tsipras, who’s made several international trips since last June, has been on somewhat of a campaign to convince the world that he’s not a crazy socialist to be feared, but rather well-placed within the Keynesian macroeconomic tradition of the social democratic left, whose European leaders believe that austerity alone cannot deliver the kind of boost to the economy that will result in greater GDP growth and more employment.   Continue reading Tsipras predicts Greek debt haircut after German elections →

Germany, Greece

Samaras ‘negotiations’ with Berlin not going so swell

1 Comment

It didn’t go so well for Greek prime minister Antonis Samaras on his visits with European Union leaders in Berlin.  His plea for more time to come up with cuts to the Greek budget is being met with stony nonchalance from both German chancellor Angela Merkel (pictured above right, with Samaras) and French president François Hollande, to say nothing of German civil society.

Samaras has requested an additional two years to come up with an additional €11.5 billion in cuts to the Greek budget.  While Merkel — and especially Hollande — were sympathetic to Samaras’s plea and reiterated their support for Greece to remain in the eurozone, Samaras will return to Athens having won no concessions from Berlin or Paris.

Business daily Handelsblatt writes:

“Greek Prime Minister Antonis Samaras does not tire of making new demands. Now he wants more time, for the health of his economy. Not more money, only more time — at least according to his requests to Berlin and Brussels. And, in Berlin and Brussels, there will be much discussion about whether Greece should be granted more time.”

“Our instinctive reaction regarding Samaras’ request is, well, that could be something. Given the near 40 degree Celsius (104 degrees Fahrenheit) temperatures that Germany experienced last weekend, we can empathize with Greek lethargy.”

“But is the Greek prime minister right? Is time instead of money really better? I say no.”

“We have known for a long time that time is money. Perhaps Angela Merkel will also say that to the Greeks. Despite the hot and sweaty 40-degree temperatures, there will be no more days off.”

Athens News reports that Merkel’s comments at a joint press conference with Samaras Friday were particularly tense:

“We expect Greece to deliver all that has been promised,” Merkel declared. In remarks that were unusually sharp for a joint news conference, she stressed that Berlin has heard words in the past but now expects deeds.

The tough talk contrasted sharply with the head of state honours and diplomatic smiles with which Samaras was received on his first official visit, complete with red carpet and band.

Merkel said that Samaras’ visit is a sign of the “very close ties” between the two countries, only to add later that each side had lost credibility in the eyes of the other and that trust must be regained.

And these are demands from someone who ‘Europe’ was desperate to win June’s Greek parliamentary elections.

Can you imagine how horrific the reaction would have been if the request had come from Alexis Tsipras, the leader of SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς)?

Merkel spent Sunday trying to calm the waters against anti-Greek feeling in Germany, after German Bundesbank president Jens Weidmann attacked the European Central Bank’s buying of state debt, and Alexander Dobrindt, general secretary of the governing Christlich-Soziale Union (Christian Social Union), the Bavarian conservative party and sister party of Merkel’s own Christlich Demokratische Union (Christian Democratic Union), speculated that Greece would leave the single currency by next year.

Greece

How many days (weeks) away are we from another Greek solvency crisis?

Leave a comment

When the world last left Greece, it was breathing a sigh of relief upon the news that Antonis Samaras would be able to cobble together a coalition following a narrow win in the June elections — the second such election in as many months.

Samaras (pictured above), now a little over six weeks into his government, is finding it increasingly difficult to get his coalition to agree on €11.5 billion in cuts, required by Greece’s bailout from the European Central Bank, the European Commission and the International Monetary Fund.  Those entities, known as the ‘troika,’ have pushed off a long-delayed review of Greece’s bailout program from September to October, but that means only that Greece’s government will have until mid-September to make the cuts. The ‘troika’ will then make a decision about disbursing the next €31 billion tranche of bailout funds to Greece, and Greece will then try to push for a renegotiation of the bailout terms to lighten the austerity that has added pressure to Greece’s downward economic spiral.

It’s clear that the ‘troika’ is getting impatient: the IMF has started to balk at throwing more money at Greece, has called on the European Union to take the lead on any further bailouts and the ECB in late July stopped accepting Greek bonds as collateral altogether.

But the Greek economy is in shambles, and is expected to contract by a full 7% this year — much more than an original forecast of 4.7%.  Greece’s recession is only getting worse, not better, and that’s after the economy contracted almost 14% in the past four years.  As tax receipts correspondingly shrink, Greece’s debt sinkhole becomes ever larger.  Greater debt requires more austerity, which cripples the economy, which leads to greater debt, and so on.

The only solutions seem to be:

  1. a miraculous economic turnaround. Not likely anytime soon.
  2. a full bailout from the European Union. Whether that means a direct cash bailout or “eurobonds” or a more inflationary ECB monetary policy, it all boils down to a transfer of wealth from Germany to Greece  — it’s an option that German chancellor Angela Merkel has resisted and which has become increasingly unpopular in domestic German politics.
  3. the “Grexit”. Greece leaves the eurozone, adopts a new drachma, and devalues it until its debts are manageable and its exports are cheap.  But that could lead to snowballing worries about Spain, Portugal, Italy and the rest of the eurozone and precipitate Europe’s own “Lehman” moment of financial panic.

The next deadline is August 20, when Greece must pay a €3 billion maturing to the ECB — and the ECB (despite its edict that it will no longer accept Greek bonds as collateral) is weighing the option of lending money directly to the Greek central bank (which can accept Greek bonds as collateral), so that Greece in turn can pay back the debt it owes to the ECB.

It’s a tidy Alice-in-Wonderland arrangement in which only a central banker could delight.

ECB president Mario Draghi deserves credit for getting Greece past yet another hurdle, but it doesn’t inspire any long-term confidence in either Europe or Greece to get the country out of its nosedive.  It takes little imagination to see how Greece could bumble out of the eurozone in short order without further intervention if and when it runs out of cash (which could now still happen in September): Greece would then be forced to pay its employees and pensioners in IOUs (think of the kind of IOUs that California issued — registered warrants — when it fell short of cash reserves in 2009), Greece would take longer and longer to pay back the IOUs, individual Greeks would start trading the IOUs for euros, and a market would develop that sets a price for the IOUs in euros.

In time, the IOUs will have become de-facto drachmas.

Meanwhile, the coalition that everyone thought would easily come to an agreement on those additional budget cuts has stalled. Continue reading How many days (weeks) away are we from another Greek solvency crisis? →

Greece

Who is Yiannis Stournaras?

Leave a comment

After a rough start for Greece’s newly inaugurated center-right government — Greece’s new prime minister Antonis Samaras remains immobilized from an emergency eye surgery over the weekend and his first pick for finance minister (Vassilis Rapanos, the head of the National Bank of Greece) resigned after falling ill last Friday — it looks like Greece finally has a finance minister.

Samaras has appointed Yiannis Stournaras as the new finance minister, although Stournaras will not attend the European Union summit in Rome that kicks off Thursday.  Samaras will not be able to attend, nor will the party leaders of his two coalition partners, Evangelos Venizelos, the leader of the center-left PASOK and Fotis Kouvelis, the leader of the more anti-austerity Democratic Left.  Instead, Greek president Karolos Papoulias, will lead the Greek delegation.

Meanwhile, in another blow to the Samaras government, newly installed deputy shipping minister George Vernikos resigned Tuesday after opponents pointed to his use of offshore companies, which are often used by Greeks to avoid taxes.

Stournaras is a generally respected professor and economist — most recently, he has served as the general director of the influential Foundation for Economic and Industrial Research, a Greek economic think tank and as development minister in the caretaker government between the May 6 and June 17 elections.

He is most well-known for his role in designing economic policy in advance of Greece’s accession into the eurozone and is known in Greece as “Mr. Euro” — it’s certainly difficult to miss the symbolism in that.  Stournaras has also worked as special adviser to Greece’s finance ministry and the Bank of Greece in the 1980s and 1990s.

Reuters reports that the Stournaras appointment, although widely applauded, does not guarantee any quick solution for the Greek economy’s future:

He faces a difficult juggling act – pushing for more time and money from sceptical foreign lenders while coaxing reluctant officials at home to push through unpopular reforms.

“Stournaras is a serious, respected person who will inspire some confidence in the markets. But he is entering a bad government, where many old-style, spendthrift politicians are occupying key positions,” said political analyst John Loulis.

“He will have to wage a hard battle against them. He is entering the wolf’s lair and he won’t survive without the prime minister’s solid support.”

A troubling nugget comes from The Financial Times, whichreports that none other than PASOK leader Venizelos, also the former finance minister who negotiated Greece’s second bailout (that the government now hopes to renegotiate), just last week vetoed the reappointment of Stournaras as the permanent development minister.

Cyprus, Greece

No country for old men

1 Comment

It’s not been the best week for the new Greek government.

Later this week, the key decision-makers of the European Union will be engaged in the latest attempt at ending the eurozone’s crisis at a conference in Rome.

But the new Greek prime minister won’t be there. And neither will his finance minister, a post that may now be vacant.

A week after his center-right, pro-bailout New Democracy won a narrow victory in Greece’s parliamentary elections, Antonis Samaras had emergency surgery over the weekend to repair a detached retina.

Meanwhile, his nominee for finance minister, Vassilis Rapanos, the president of Greece’s national bank, has resigned (or turned down the offer — he was never formally sworn in) after falling ill on Friday and being rushed to the hospital.

Newly sworn-in foreign minister Dimitris Avramopoulos won’t attend.

Neither will Evangelos Venizelos, a former finance minister and leader of the center-left (and also pro-bailout) PASOK nor Fotis Kouvelis, the leader of the more leftist (and moderately anti-bailout) Democratic Left.  Both PASOK and the Democratic Left are supporting Samaras’s government, but have refused to take any ministerial roles in the new government — indeed, both Venizelos and Kouvelis seem incredibly terrified that the staunchly anti-bailout and radical leftist SYRIZA will steal even more of their support base.  SYRIZA placed a strong second in the June 17 elections and now threatens to displace PASOK as the dominant party of the Greek left.

Greece’s president, Karolos Papoulias, will lead the delegation instead.

Leading Greek newspaper To Pontiki calls out the government for its “sloppy handling” of Greece’s representation in Rome, but it is hard to blame Samaras too much for the unfortunate timing of two medical emergencies.  But the incident marks an ominous tone for Greece at a time when the country seems to have days or weeks (not months) to shore up Greece’s position in the eurozone.  After a campaign in which even Samaras agreed that the bailout package should be renegotiated in a way to help the Greek economy out of recession, it will be a massive blow to Samaras’s government that he will not be in Rome, nor will his initial choice for finance minister, nor will the leaders of the two parties that are his coalition partners.

In other news likely to be depressing to Athens, the country with the largest exposure to Greece’s banks has now requested a bailout from the European Union as well — Cyprus needs €1.8 billion this week to shore up Cyprus Popular Bank.  The amount, tiny by EU bailout standards, represents 10% of Cyprus’s GDP.  Although the European Central Bank will want to impose some conditions on the bailout, Cyprus has also been talking to Moscow and Beijing about a cash infusion, making the Cyprus situation not only a financial headache for Athens, but a strategic headache for Berlin and Brussels as well (and it’s not as if the EU doesn’t have one or two problems that make even Greece seem like an afterthought).

Greece

Who is Fotis Kouvelis?

1 Comment

With Fotis Kouvelis, the head of Greece’s Democratic Left (Δημοκρατική Αριστερά), the most moderate of the three vaguely anti-bailout leftist groups to thrive in Sunday’s election, now in discussions with Evangelos Venizelos, the former finance minister and the leader of center-left PASOK, to form a national unity government, the center spotlight of Greek — and European politics — now shines on Kouvelis, who was ranked the most popular party leader throughout the election campaign.

Kouvelis, at 63 years old, is as soft-spoken and understated as his young leftist rival Alexis Tsipras is brash:

Avoiding the fiery rhetoric and bombastic speeches popular with Greek politicians, Kouvelis speaks in a measured tone and is seen as a figure who can restore the country’s dignity.

”Political intensity and the power of a stance or a proposal cannot be found in yelling, but in the content of what you have to say,” Kouvelis told Reuters.

Pledging to ditch austerity policies without jeopardizing Greece’s membership of the euro zone, Kouvelis has successfully lured away former PASOK voters disillusioned with the Socialist party’s support for unpopular wage, spending and pension cuts.

A fixture in Greek politics since the 1980s, he has been a member of parliament since 1989 (except for a brief spell from 1993 to 1996), and served briefly in 1989 as a minister of justice.

Kouvelis formed the Democratic Left in 2010 with fellow members of Synaspismós, the leading party in the SYRIZA group that Tsipras leads, over differences with Tsipras’s more radical opposition to the bailout and Greek budget cuts.  Prior to Sunday’s election, the Democratic Left held 10 seats in the prior Hellenic parliament — four former SYRIZA MPs and six former PASOK MPs who joined the Democratic Left only in March 2012.  On Sunday, the Democratic Left won 19 seats and nearly 7% of the vote.

Kouvelis has walked a tight line throughout the election campaign — he strongly supports Greece’s continued membership in the eurozone and his party’s slogan has been “the responsible left,” and throughout the campaign, he refused to join forces with SYRIZA.  After Sunday’s vote, he also seemed to rule out a coalition with PASOK and the center-right New Democracy as well.  Nonetheless, he has strongly opposed the harsh austerity and other terms mandated by the bailout Greece has received — his program has emphasized the renegotiation of Greece’s bailout, including some debt forgiveness from the European Central Bank.  He also favors stimulus spending to bring Greece out of its current near-depression economic conditions.

If he is serious about joining a coalition with PASOK, the key question will be how far PASOK (and New Democracy, if it joins any such unity coalition) is willing to consider a renegotiation of those terms.

If any such coalition succeeds, Kouvelis will reap the political benefits of pulling the pro-bailout parties into an acknowledgement that the current bailout terms are too harsh, bringing some relief to Greece’s economy and a reprieve from the harshest elements of its austerity program, and restoring some stability to Greece’s politics — for a while — without drawing the international ire that would result from a further debt default or a return to the drachma.

Greece

Who is Alexis Tsipras?

4 Comments

UPDATE (6-16-12):  We originally (and mistakenly!) used a photo from this photographer — he has some strikingly amazing photos of Greece and its political scene, so everyone should go check them out, especially one day away from the next Greek elections.

* * * *

With New Democracy unable to form a coalition government, the spotlight now falls on the newest star of the Greek — and European — political scene to take a stab at forming a new government.

Although it remains unlikely that he can do so, there’s no doubting that Alexis Tsipras will be a key player in the next act of the Greek drama unfolding before a global audience.

Tsipras is the leader of SYRIZA (the Coalition of the Radical Left — Συνασπισμός Ριζοσπαστικής Αριστεράς), which outperformed polls and finished second in Sunday’s election with 16.78% of the vote and 52 seats in the Hellenic parliament, quadrupling SYRIZA’s vote share in the previous 2009 legislative elections.

SYRIZA is technically a coalition of parties, of which Tsipras’s own Synaspismos is the largest member, and has contested Greek elections as a coalition since 2004, when it won its first six seats.  Tsipras, who scored third place in the 2006 Athens mayoral race, became SYRIZA’s leader in 2008 and has been a member of Greece’s parliament since 2009.

In a political world that’s been full of old men named Samaris, Papandreou and Karamanlis for nearly a century, the 38-year-old Tsipras — he was born four days after the fall of Greece’s military dictatorship in 1974 and is a civil engineer by training — sticks out as a fresh face and the undisputed face of the left’s anti-bailout sentiment:

A cool, mild mannered politician who shuns neck ties and likes to get around on his motorcycle, Tsipras can be a fiery orator in parliament, railing against austerity.  Often blamed by the socialists for inciting violent protests, he has promised to freeze payments to creditors and renegotiate measures included in Greece’s latest rescue package.

Commentators believe that if a second round of elections occurs, Tsipras will have enough political momentum to command enough seats to form a government:

Spiros Rizopoulos, a political communications strategist and chief executive of Spin Communications, thinks that a second round of elections is inevitable and would likely favor SYRIZA at the expense of the country’s two mainstream parties.

“Tsipras will do better in a second round. He has momentum at a time when people are ready to listen to anything,” said Rizopoulos. “If he is smart, he will start moving to the center. But politics is all about momentum and he has got the momentum.”

Two years of harsh austerity measures, adopted by Greece in exchange for successive bailouts from its European partners and the International Monetary Fund, have pushed the economy deep into recession.

If Tsipras is successful, he may yet transform SYRIZA into the main vehicle of the Greek left, displacing the longtime socialist PASOK, which has supported the harsh budget cuts and various rounds of bailouts since it won the 2009 legislative election.

Greece

BREAKING: ND leader Samaras unable to form coalition

Leave a comment

From E Kathimerini:

Antonis Samaras, leader of Greece’s center-right New Democracy, has failed to form a governing coalition following Sunday’s Greek election.

”We did everything we could,” Samaras said. ”It was impossible (to form a government). I handed back the mandate.” Samaras, whose party won the biggest share of the vote in Sunday’s inconclusive election, was given the first chance to form an administration by President Karolos Papoulias.

Alexis Tsipras, the leader of Greece’s second-place party, SYRIZA (the Coalition of the Radical Left), will now have an opportunity to try to form a government, but the likelihood that he can build a coalition is even more remote, and a second election is looking increasingly likely.

Greece

PASOK gets post-Venizelos polling bounce

2 Comments

In the wake of anointing former Greek finance minister Evangelos Venizelos as its new leader, the Panhellenic Socialist Movement (Πανελλήνιο Σοσιαλιστικό Κίνημα), or “PASOK” (ΠΑΣΟΚ in Greek) has received a small, but noticeable, bounce in the latest polls in advance of this spring’s legislative elections.

PASOK receives 15.5% to 22.5% for the traditionally center-right New Democracy party (Νέα Δημοκρατία).

Meanwhile, the KKE (Greece’s Communist party) would win 12%, SYRIZA (the Coalition of the Radical Left) would win another 12.5%, and the new DIMAR (Democratic Left) would also win 12%.  A new anti-austerity right-wing party, the Independent Greeks, would win 8.5%.

LAOS (the right-wing Popular Orthodox Rally) would take just 2%, the neo-fascist Golden Dawn takes 5% and the Ecologist Green party takes 3%.

Both of Venizelos and ND leader Antonis Samaras had nearly identical 30% favorability and 30% unfavorability ratings.  Fotis Kouvelis, the leader of the Democratic Left, remained the most popular of the leaders with just over 50% favorability.

It’s shaping up as an odd election in that the traditional parties of the right (ND) and the left (PASOK) have converged in their positions — ND presided over the initial 2008 global financial crisis and PASOK presided over the onset of the 2010 sovereign debt crisis and subsequent waves of budget cuts, notwithstanding its traditional character as a socialist party.

As such, and especially following the appointment of Lucas Papademos as interim prime minister in November 2011 with the support of both ND and PASOK, both parties are pregnant with supporting the harsh austerity terms that have conditioned Greece’s recent bailouts:

[Translated from the original Greek]: In other words, the two (former) major parties in power have come so close by ideological (neoliberal) view and policy (co-ruling) practice, they now appear as “one flesh.”

Most commentators assume that the ND will win the elections with a minority or in a more formal ‘grand’ coalition with PASOK, thereby making permanent the informal coalition cobbled together to appoint Papademos.  Together, PASOK and the ND — the “bailout” parties — win just 38% of the vote. Continue reading PASOK gets post-Venizelos polling bounce →