Christian Hartmann / REUTERS Greek Prime Minister Alexis Tsipras in Athens, July 2011.

Between Trump and the Troika

Greece After the U.S. Election

This week, Greek Prime Minister Alexis Tsipras and U.S. President Barack Obama met in Greece. During the last such visit, when President Bill Clinton ventured there in 1999, Tsipras was out on the streets of Athens, protesting. Things have changed. This time, Tsipras warmly welcomed the U.S. leader and they agreed on a common message: less austerity and more policies to induce growth.

Obama’s trip came as the United States tries to heal from one of the most divisive elections in recent history. And in large part, the outgoing president’s task is to reassure Greece, which could be upended by the results of the vote, since President-elect Donald Trump indicated during the campaign that he views the Greek crisis as Germany’s problem and that Greece shouldn’t have entered the eurozone. During his presidency, Obama has followed nearly the opposite approach, persistently intervening against austerity and arguing in favor of significant debt relief for Greece.

Tsipras is one of the last European leaders that Obama will meet as president, German Chancellor Angela Merkel being the next. His visit was a particularly useful distraction, since it came as the coalition government between Tsipras’ radical left Syriza and its partner, the Independent Greeks (ANEL), faces a crisis similar to those that slammed preceding Greek governments after they implemented the harsh austerity measures stipulated in previous bailout agreements.

Obama’s visit coincides with the second evaluation of Greece’s progress toward the targets of its bailout program. The disbursement of the next tranche of money—and therefore the country’s financial stability and the government’s prospects—hinge on this evaluation. For the last several months, Tsipras has tried to divert attention away from his administration’s slow implementation of the bailout measures, to little avail. For instance, Tsipras’ effort to change the process by which television channels’ licenses are issued—an initiative that he and his government were deeply invested in—ended with a Constitutional Court ruling finding the law unconstitutional.

The political deadlock (and Tsipras’ low approval ratings) could be eased if Obama’s visit brings with it a breakthrough in the lingering debate over Greece’s debt sustainability. The Greek government is hopeful that, in his last days in office, Obama will put pressure on the IMF and Merkel to grant Greece some kind of debt relief, but Trump’s victory has unsettled things.

U.S. President Barack Obama and Greek Prime Minister Alexis Tsipras at a state dinner in Athens, November 2016.

U.S. President Barack Obama and Greek Prime Minister Alexis Tsipras at a state dinner in Athens, November 2016. 

SYRIZA STUMBLES?

Greece’s political landscape has been shaken since the 2012 elections, which saw a major vote against the establishment long before Brexit or the election of Trump. The uncertainty surrounding Trump’s policy toward Greece could now exacerbate the volatility in the Greek political system.

Syriza is trailing the main opposition party, the center–right New Democracy (ND), in all polls. The implementation of harsh austerity measures is partially responsible for the drop, but the multiple electoral contests that took place within 2015—two national elections and a referendum—are also part of the story. Tsipras spent precious political capital competing for those votes and attempting to transform his party from a radical leftist movement to a social–democratic mainstay. Now Tsipras hopes that, when Trump steps into the White House, he will likewise have a change of heart on the Greek debt issue.

ND, whose leader, Kyriakos Mitsotakis, offered a reserved statement following Trump’s election, is now ahead in the polls. Mitsotakis was an outsider who was recently elevated to his role after an intense internal party struggle. He is now preoccupied with aligning the ND with a firmly liberal tradition and eschewing the populist demagoguery of previous years. Polls suggest he is more popular than Tsipras. It remains to be seen whether this dynamic will translate into a victory for ND when the next national elections take place in 2019.

The center–left is more fragmented. The formerly dominant Panhellenic Socialist Movement (PASOK) issued a statement following Trump’s victory warning against “the rise of deeply conservative, anachronistic, and populist parties.” But PASOK is diminished and has been ineffective in its attempts to spearhead a center–left coalition. The River, a reformist party that claims to stand outside of the left–right ideological axis, was also alarmed by Trump’s victory, but it appears incapable of securing any more than single-digit percentages of the vote or to collaborating effectively with PASOK. Similarly, the most recent entry into the Greek parliament, the Union of Centrists, which issued a statement of hope that Trump will prove wrong all those who presented him as unreliable, is squeezed politically by the showdown between ND and Syriza 

Further to the right, Syriza’s coalition partner ANEL—whose leader was the first to warmly welcome Trump’s election on Twitter—has been taking a hit in the polls as a result of the government’s poor performance. However, its electoral resilience in recent elections and its stronger presence in Tsipras’ cabinet following the latest government reshuffle make the party optimistic. Meanwhile, the far–right Golden Dawn, which welcomed Trump’s election as “a victory of the forces who are against globalization, illegal migration, and are in favor of pure nation-states with autarchic national economies,” is doing well in the polls. Trump’s election could give it a boost.

On the left, the Communist Party of Greece (KKE), which has always been critical of the United States and has described the choice in the recent election as a vote between “Scylla and Charybdis,” will certainly gain support among voters disappointed with Syriza. But KKE will not be the only one benefiting. Existing left-wing parties, such as Popular Unity (LAE) and the Anticapitalist Left Cooperation for the Overthrow (ANTARSYA), and more so the new left-wing party Plefsi Eleftherias (Course of Freedom), stand to gain from Syriza’s decline.

Raising a flag in Athens, April 2012.

Raising a flag in Athens, April 2012.

THE TRUMP EFFECT

Given all the turmoil in Greece’s party system, it is worth asking whether the country will see early elections. For now, the next national parliamentary vote is scheduled for 2019. And Tsipras’ recent cabinet reshuffle was an attempt to slow his government’s decline and head off an early vote. New and younger faces entered the administration and the foreign press welcomed it as a sign of “getting with the program.” Thus, elections do not seem to be imminent. 

They could still happen, though, and there is little doubt that ND would finish first. The question is whether the party would be able to form a government on its own. And that would be no easy feat. If it tries to win a majority by absorbing a critical mass of voters from parties such as The River and pushes them below the three percent threshold necessary to enter parliament, it would leave ND with fewer options in its effort to form a governing coalition. In such a case, it may not be able to form a government and new elections could take place. Only this time, they would be conducted under a new electoral law that makes forming one-party governments nearly impossible. 

Either way, Trump’s electoral success will hang heavy over the proceedings. In Greece, Trump’s election has driven a wedge between Syriza and ANEL: Syriza appeared to be disappointed with the results, whereas ANEL was jubilant. It was yet another reminder of the partners’ fundamental ideological differences. At the same time, it complicates the dynamics of coalition formation. For instance, if Trump does not have a change of heart on the Greek debt issue, ND and Syriza may find themselves on the same side. Yet, many in Greece—including Tsipras—are hopeful that Trump will be a different president than candidate. That remains to be seen.

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