Greece's Electorate in Search of Pinocchio

A week from tomorrow the Greeks go to the polls in “snap” parliamentary elections, brought on more than a year early because their current Parliament could not agree on a new, strictly ceremonial President to replace the one whose term expires at the end of this month. 

Greece's Parliament Building

I’ve avoided writing anything more on the subject than a passing observation or two, mainly because I’m not one given to voyeuristic urges that transfix so many onto disasters in the making.  But I write about Greece, and with the world’s media focused on those parliamentary elections, how could I not offer my observations?  

 

To me, the January 25th Greek elections are akin to watching a speck on the horizon, slowly but inevitably turn into a bumper-to-bumper parade of awkward buses, barreling down a racetrack straightaway toward a clearly marked hairpin turn. 

So, let me start out with my bottom line: Based upon what I’ve read and heard first-hand from respected, knowledgeable journalists and political-attuned sources, it appears the election will yield positive results for Greece only if the likely winner has been lying to Greece’s voters for years about his party’s seminal goals when he comes to power.

Ouch.

The decline of the Euro has the US dollar up to $1.15 against the euro, a drop in the euro of approximately 17% from a year ago to a nine-year (at least) low.  Blame for that, and any number of other financial surges and declines is laid at the feet of anxiety generated by the Greek elections, claiming those results portend the future of the European Union. 

Hyperbole?  Probably—though I know hedge funds of the vulture sort are busily planning for ways to profit off what follows Greece’s elections, a vote billed as perhaps the country’s most significant election since the end of World War II.  Hyperbole again?  Only time will tell.

Current party makeup of Parliament

According to Reuters and Bloomberg, polls taken a few days ago (by pollster Alco) show that the two parties now comprising Greece’s coalition government (New Democracy and PASOK) will not garner enough votes to keep their coalition alive. New Democracy is characterized as center-right, PASOK as center-left, but in the minds of most voters, “a plague on both their houses;” because one or the other of those parties has been in power since the mid-1970s.  That makes them easy targets for a highly dissatisfied electorate and those anxious to replace them in power.

All polls predict that the party most likely to draw the most votes is SYRIZA, an amalgam of far-left parties of disparate philosophies.  The voter-attracting cry of SYRIZA and its charismatic leader, Alexis Tsipras, is a promise to renounce the onerous conditions of the EU-ECB-IMF 240-billion Euro bailout of Greece, “force” a major reduction of the owed loan amount, and restore pensions and jobs.  Thus far, the Troika’s reply has been, “no-way,” and sabers are rattling that should SYRIZA follow that course it will lead to Greece’s exit from the Euro-zone–­–as legally complex and seemingly unachievable as that may appear.  “Catastrophe” is the word most heard from clear-thinking Greeks should that scenario come to pass.

Leader of SYRIZA

All of which has triggered stories in the press—and anecdotal reports of informal, private conversations––with SYRIZA party leaders assuring influential, financially skeptical folks that their leader doesn’t really mean what he’s saying, for he realizes exiting the Euro would inflict economic chaos upon the country. 

In other words––wink, wink––don’t worry it’s just a politician saying what he must to get elected.   On the other hand, New Democracy’s pronouncements of financial gains have been substantially undercut by recently released actual figures.  All this, in a country reeling from a chronic unemployment rate greater than that of the US’s Great Depression era.  Anger is endemic, protest votes likely, and at least 10.6 % of the country’s 9.8 million voters are still undecided.

Leader of New Democracy

The common wisdom (?) is that neither of the top two finishers will be able to form a government on its own.  According to that same Alco poll, SYRIZA is predicted to draw 3.5 % more of the vote than New Democracy (32.4% to 28.9%), though there are polls out there showing the lead anywhere from one-half to more than twice that 3.5%––but all show SYRIZA ahead.

The actual percentage of cast votes needed for a party to control Parliament is not 50% of the overall vote, because Greek law (a) awards the winning party 50 of the 300 seats in parliament, and (b) disqualifies parties gaining less than 3% of the vote from holding seats in Parliament, before dividing up the balance of the seats.  All of which means it will likely take between 36 and 38% of the popular vote for the #1 vote-getting party to control parliament.

Parliament in session.

The big parlor-game question around Greek tables is, assuming SYRIZA wins without receiving an outright majority, with whom will it partner to reach that magic 36-38% of the popular vote?   

Retiring Greek President

If you’re really into arcane Catch-22 conundrums, Greek constitutional procedure gives the second and third largest vote-drawing parties a turn at attempting to form a government should the party ranking above it fail to do so.  Once a government is formed it must present itself to the President. Yes, the same president that Parliament failed to elect, thereby precipitating these elections.  So, what happens if a new government is not formed before the current president’s term expires at the end of this month? That question has constitutional lawyers tossing in their sleep.

But the biggest procedural nightmare facing Greece as it struggles to find its economic footing is that no party is able to form a government, thereby requiring that the election process go forward again…and again…until one is formed.

So, who might those coalition partners be?

According to the Alco poll, there’s a real horserace underway for third position, and all sorts of speculation on potential partners to reach that 151-seat magic number.  One scenario you will not see is SYRIZA and New Democracy holding hands together in a coalition government. There’s a better chance of The Tea Party embracing President Obama.

A different, earlier poll.

Here are potential coalition partners and their estimated percent of the vote.  Each one offers an interesting dynamic, whether good, bad, or very, very bad is yet to be seen.

5.1%    To Potami (The River), a recently formed Centrist Party and the most likely party to partner with SYRIZA despite rhetoric by each to the contrary…for it offers SYRIZA a cover story to pitch to its supporters for why it had to change its position on a hard confrontation with the Troika.

5.0%    Chrysi Avgi (Golden Dawn), the far-right Nazi party with its leadership in jail.  Hard to imagine New Democracy or SYRIZA partnering with Golden Dawn, but protest votes, and the splitting of votes among otherwise more moderate parties, gives it a chance of finishing #3.

4.0%    KKE, the communist party, and one openly courted by SYRIZA to be its partner.

3.6%    PASOK, governed during the debt crisis until 2012, but not likely to give SYRIZA the votes it needs even if the two could learn to play nice with one another.

Former PASOK Prime Minister saying, "There is money."

Under 3%        A group of parties, totaling 9.1% of the vote, includes the party of the former head of PASOK who resigned as Prime Minister during the crisis only to surprise the country with the announcement two-weeks ago that he’d formed a new party.  His reasons for doing so are likely known only to himself, but his decision has provided endless fodder for speculation among Greeks notorious for seeing a conspiracy in the number of raisins in a cereal box.

I wish I had an opinion, let alone an answer, to offer on how all this will turn out, but not one objective observer seems to have good news for the passengers onboard those buses roaring into that hairpin turn––that is, assuming their drivers stick to their avowed plans for negotiating their way through it. 

Funny, isn’t it, how so many who care about Greece are now praying for its politicians to be liars?

Jeff—Saturday