Washington’s Dangerous New Consensus on China
Don’t Start Another Cold War
Every year in early September, Greece kicks off its political season with an address from the prime minister at the start of the Thessaloniki International Fair. This year was no different. Prime Minister Alexis Tsipras opened the event with an optimistic talk about the recovering economy, and how Greece would soon “graduate” from the bailout agreements. He claimed that his government had acquired valuable experience from overseeing austerity programs and had learned from its mistakes in managing the debt crisis. Thus, according to Tsipras, “now is not the time to entrust Greece’s fate to the opposition”—the parties that he claims created Greece’s continuing socioeconomic crisis.
A week later, as the fair neared its end, Kyriakos Mitsotakis, leader of the main opposition party, the center-right New Democracy (ND), rebutted Tsipras. The prime minister, his opponent argued, was not telling the Greek people the truth about the country’s problems, which will extend well beyond Greece’s exit from the bailouts, due in August 2018. Instead, he was pursuing an opportunistic agenda to cling to power. But ND, Mitsotakis argued, does speak the truth: that more reforms, lower taxes, and hard work were necessary to get the economy growing again.
Although the Greek elections are theoretically scheduled for 2019, Greek politics are volatile and an election could come much sooner. The Tsipras administration could decide to call for an early vote if Syriza is polling well and if the Greek economy is showing signs of recovery. Moreover, early elections in 2018 would open up an opportunity for the government to capitalize on the symbolic event of exiting the third bailout program. If the winner of such an election manages to form a government then things will be relatively straightforward. But if the parties were to fail to form a coalition, Greece would have to hold another election a month later, only this time with pure, proportional representation. And given the fragmentation of the Greek party system, the cooperation of the two main parties, ND and Syriza, will be required to form a government.
If an election were to take place tomorrow, most polls suggest that Mitsotakis’ ND would have a clear lead over Tsipras’ Syriza. A recent poll by Metron Analysis shows ND 10 points ahead of Syriza. To the question “Who is more suitable for prime minister?” 25 percent said Mitsotakis and only 13 percent said Tsipras. This particular result is significant, since the incumbent prime minister has traditionally remained more popular than his opponent even when his party has fallen behind in the polls. This reality is hardly a recent development, as it has taken shape over a period of two years. Lately, Syriza has halted its downward trajectory in the polls, but whether it can reverse this trend remains to be seen.
Indeed, two-and-a-half years since his rise to power, Tsipras has used up much of his political capital on a referendum and a snap election. In July 2015 he called for a referendum on the country’s third bailout package, expecting an overwhelming “no” vote. Although the nation did indeed say no to more austerity, Tsipras moved forward with the unpopular policies anyway, much to the displeasure of his supporters. Tsipras tarnished the credibility of the coalition government (between the radical left Syriza and its right-wing partner, the Independent Greeks) when he admitted that Syriza had “illusions” about its ability to negotiate with the country’s creditors. Tsipras’ popularity also declined after he flip-flopped on a number of important issues, such as privatization, the labor law, debt relief, and taxation.
Syriza, and Tsipras in particular, are trying to rebrand themselves, but that is producing a confusing mix of sometimes contradictory messages. Tsipras has made a systematic attempt to present Syriza as a social democratic, center-left party, for example by publishing an essay drawing parallels between Syriza and the social-democratic Panhellenic Socialist Movement (PASOK) during its early years in power in the 1980s. He also compared himself, albeit indirectly, to Andreas G. Papandreou, the charismatic leader and founder of PASOK.
At the same time, however, Tsipras has made a concerted effort to shift the national conversation away from “Grexit,” a topic that recently reemerged amid difficult debt talks between Athens and Brussels, and toward “Grinvest.” In other words, he is also presenting himself as good for business and entrepreneurship. He described Greece as “an attractive destination for investors” during French President Emmanuel Macron’s visit in early September. “Our duty,” he said in his speech during the international fair, “is to create a new Greece…to stimulate growth and to build on the positive momentum of the Greek economy, to improve the business climate and investment.” A few days before his address, Tsipras visited a number of large businesses, as well as the Impact Hub in Athens, an organization that focuses on youth entrepreneurship.
The problem is that, as Syriza tries to broaden its appeal by behaving like a catch-all party, it faces the danger of losing the support of its original core followers without gaining any new ones. Tsipras’ pro-investment rhetoric is undermined by the fact that some investors are wary of remaining in the country. Within hours of his address at the Thessaloniki International Fair, Eldorado Gold—a large mining company—announced that it would freeze its investment plans in Greece and blamed the government for delaying its operating licenses. A week later, however, the company postponed its decision, saying that the government had approached company executives for a “constructive dialogue,” but that Eldorado Gold retained its right to pick up and leave in order “to protect the company and its assets.” More recently, a Qatari state company, Al Rayyan, announced the cancelation of its investment activities, claiming that some people in Greece simply “do not want foreign investment.” What’s more, it is also unclear whether Syriza—a party that has traditionally been opposed to privatization and foreign investments—will be willing to live up to Tsipras’ talk on wooing investors.
This situation is compounded by significant failures of governance. In mid-September a Greek oil tanker sank off the coast of Athens, causing an oil spill. The government was slow to send a clean-up crew or ask for help from the European Union. As a result, the toxic oil spread.
Meanwhile, ND has experienced a revival since Mitsotakis’ election as the party’s leader in January of 2016. It faced two electoral defeats in 2015, but is now ahead of Syriza in the polls. Still, the party is not without its own challenges. ND has been pushing for early elections for over a year now, which could make its criticism of the government appear less genuine. Moreover, it may have reached the limits of its growth potential, given the high levels of consolidation in the recent polls. Finally, the party is traditionally plagued by internal fighting over its future direction and whether it should become more liberal or more conservative. But given the prospects for victory in the next election, the various factions are likely to set aside their differences for now. ND’s goal is not just to win the next election, but also to form a successful government.
The performances of the smaller political parties will also be a big factor in the success of either Syriza or ND. The once dominant PASOK and the Democratic Left morphed into the Democratic Alignment in August 2015. Right now, this political family, which is temporarily calling itself the Center-Left, is polling third and is holding internal elections for a new leader who will decide upon the name for the coalition. Ten nominations have already been announced, including the current leader, Fofi Gennimata; Athens Mayor Yiorgos Kaminis; Stavros Theodorakis, leader of The River, another political party; and European Parliament member Nikos Androulakis.
This is an especially important vote for the Center-Left because the new leader will determine the party’s direction. If the new leader takes it to the left of center, then he or she may lose voters to ND. Alternatively, if the new leader moves right of center, ND may lose some votes but could still win the elections, and in that case it would also have a certain coalition partner. For instance, if Kaminis—one of the leading figures on the “yes” side in the 2015 referendum—wins the internal election, he could weaken ND electorally because of his popularity among center-right voters, but he would also make his party an almost certain coalition partner for ND, if the latter were to win the elections. It becomes quickly apparent, however, that determining which outcome will benefit ND or Syriza is quite a tricky enterprise.
Other parties that are central to the electoral scene include the far-right Golden Dawn, which is currently polling fourth. That said, prominent members of the party are on trial, facing charges of running a criminal organization. But it is unclear what the verdict will be and even less clear how it will affect the electorate.
The Communist Party, occupying fifth place in the polls, is hoping to steal disgruntled leftist voters from Syriza. This remains to be seen. The Union of Centrists, polling in sixth place, is likely to enter Parliament again, based on the most recent polls. The party’s president, Vasilis Leventis, has been consistently pushing for the formation of a grand coalition government to ensure government stability.
Meanwhile, the minor coalition partner, the Independent Greeks, a populist right-wing party, is polling seventh and may not make it above the three percent threshold needed to enter Parliament. It is in search of a new narrative for the upcoming elections since its old “anti-austerity” talk is bankrupt, given that the country signed a third bailout agreement in 2015. The Independent Greeks party is trying to keep its right-wing voters happy as well as its left-wing coalition partner, Syriza. It is quite a difficult task.
Things are more fragmented to the left of Syriza. There are numerous parties that could pull voters away from Syriza, but they are currently polling below three percent: Popular Unity, led by former Energy Minister Panagiotis Lafazanis, and Plefsis Eleftherias, led by the former Speaker of the House, Zoe Konstantopoulou. No one knows at this time whether former finance minister Yanis Varoufakis will form a new party from his fledgling movement, DiEM25, which is advocating EU reform. All three of the above were Syriza members of Parliament until August 2015.
If any of these small leftist parties enters Parliament then things would get more complicated. Such a development could weaken Syriza electorally, but at the same time could also undercut ND’s prospects of forming a government if it were to win the elections. Based on Greece’s electoral law, the lower the percentage of votes that goes to parties that fail to enter Parliament, the higher the percentage a party needs in order to obtain the 151 seats required to form a government. This is yet another illustration of the complexity of the situation.
The domestic uncertainty is exacerbated by recent international developments. The results in the German election, which saw Chancellor Angela Merkel succeed to a fourth term, carried a sobering message for Greece. Her prospective government coalition is likely to include the Free Democrats, whose party leader has repeatedly called for throwing Greece out of the eurozone. The hope, however, is that a middle ground will be reached.
Greece may no longer make headlines but the truth is that its political landscape is still filled with uncertainty.