Tuesday, 15 November 2011

The Conservative Conundrum

Conservative New Democracy leader Antonis Samaras insists that he won't sign a letter binding him to the terms of an October 26 bailout agreed in Brussels. Without that letter, says Commissioner Olli Rehn, Greece's next instalment of 8bn euro will not be released; and without that, Greece will have difficulty meeting payroll beyond December 15. So is Samaras going to be responsible for Greece going into disorderly default?

Newly installed Prime Minister Loukas Papademos put the ball very much in Samaras' court during his first parliamentary address yesterday, when he declared that Greece's written consent was the last remaining obstacle to receiving the money.

Samaras' position is understandable from a certain point of view. He expects to be elected to lead the country in February or March, or at least to the position of top party in parliament by number of seats. A recent poll by Public Issue published in Sunday's Kathimerini gives him anything between 121 and 132 seats - not enough to form a government on his own, but far above the maximum of 61seats it gives Pasok. When the next coalition talks happen, it will be Samaras and not Papandreou who will be in the driver's seat.

Samaras knows that he cannot hope for voter approval if he is the cause of a default. It is to be expected, therefore, that some kind of compromise will be reached. Samaras will have to agree to sign some bit of paper, and will publicly fuss over its precise wording. New Democracy must not appear to block the 6th instalment, nor to compromise its room for manoeuvre before it is elected.

In its new role as coalition partner, New Democracy is increasingly caught in this battle of substance versus symbolism. It is trying to preserve the image of a bailout enabler who hasn't been compromised by wielding any power over the bailout terms. Entering the coalition presented the same dilemma. Ultimately Samaras decided on a limited participation (placing ministers in the foreign affairs and defence portfolios) that did not compromise New Democracy in economically sensitive ministries. But the fact that this dilemma keeps showing up means that the coalition is on tenterhooks.

Samaras' position is both untenable and hypocritical: Untenable because he will have to keep inventing ways to portray himself as the opposition within the government. The longer the government survives, the more energy Samaras will have to spend being a rebel; and hypocritical because by the constitution, the cabinet is collectively responsible for the government's actions, and as coalition co-guarantor Samaras must be understood to support Papademos' actions.
Ultimately, though, the coalition seems to serve his purpose. Papandreou has done much of the dirty work of austerity hitherto. Papademos will quietly negotiate the austerity measures that will come in 2013-2014. Sandwiched between these bouts of unpleasant enforcement, the 2012 election can be expected to revel in populism. Samaras can afford to rail against unpopular policies that he cannot but enforce. He can thus fulfil the role the eurozone's leaders have come to expect of Greek politicians: to deny responsibility and take handouts defiantly.

1 comment:

  1. What is concerning to me, from afar, is that the Greek people would favor ND over Pasok probably to grant them such a majority in the next parliament. Was it not ND that ran the government and the finances of the country into the ground for the five years before Pasok took over only a short while ago? ND bloated the government payroll even more and dined off of the largess of the rest of Europe, while leaving the sickness of corruption unhealed and the rest of the economy in the same morass it had been in for many years. Pasok has done poorly since it took over, but is ND a viable alternative? I wonder why we should think so.
    tom rocco


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