Greek political scenery revisited
The Greek political scene will never be the same after the vote in parliament on 12 February, in which 199 deputies in a house of 300 approved a second austerity package in two years, a prerequisite for the country to sign a new contract with its private (Private Sector Involvement (PSI)) and official (EU-ECB-IMF troika) creditors.
In short, Athens is being offered a second deal to cut down its debts held by banks by 50% (PSI) and at the same time be given another €130 billion in soft loans by its official creditors, of which anything between €30-40bn will be used to recapitalise the banks. This package constitutes a new Memorandum of Understanding between Greece and its official creditors the troika. But where does this leave the country's political environment?
New environmentIn the November 2009 election, the Socialist PASOK party won 160 seats, centre-right New Democracy 91, nationalist LAOS 15, Stalinist communist KKE 21 and reformist communist SYRIZA 13, but all that changed on 12 February. Let’s follow the facts.
The leaders of the two major parties, PASOK’s George Papandreou and ND’s Antonis Samaras in supporting the Papademos government, warned their deputies that a positive vote for the new Memorandum was a must. 40 MPs disobeyed this 'order' and, as a result, were ousted from their party's parliamentary group.
PASOK is now reduced to 131 sits, ND to 62, LAOS 14 and SYRIZA nine, with 63 independent MPs. What is even more important, however, is the strength of the parties as measured by opinion polls. PASOK ranks fifth, below first-place ND at around 30%, the Democratic Left under Fotis Kouvelis has 18% with KKE and SYRIZA around 12% each and LAOS at only 5%.
The threshold to enter parliament for a party is 3% - in short the present parliamentary majority of PASOK and ND, which effectively supports the pro-Memorandum government of Loukas Papademos, will be in ruins after a general election, if the polls are more or less right.
In reality, it will be very unlikely that these two parties will be able to form a coalition government commanding at least 151 seats, but ND leader Antonis Samaras is still insisting that a general election be held in April.
In addition, on the night of 12 February in parliament, he also said that the government that will be formed after the election will “renegotiate the terms of the Memorandum”. This constitutes a direct challenge to the Eurogroup's decision that the Greek political leaders who back the Papademos government sign letters reassuring everyone that they will continue applying the same austerity measures voted for yesterday. Samaras is set to sign such a declaration before 15 February, when the Eurogroup will meet to assess whether Greece must comply with the terms set last week by the same Council.
It would be very curious situation if Samaras signs his reassurance letter after having announced a demand for “renegotiation” of the MoU – and this will be a red rag to the Eurogroup ‘bulls’. Obviously, Samaras wants to reduce the political cost his party will pay for supporting the Papademos government and the unpopular second austerity package with this ‘renegotiation’ rhetoric, and it is clearly political ‘tracer fire’ to check the reactions of the other 'side'. German Economics Minister Philipp Roesler, even following the approval of the austerity measures by the Greek parliament, said early on 13 February, that the creditors must now deliver their own verdict on Greece.
Papademos’s party?
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