Greece Takes Revenge

For two years, Greek voters could only express their mounting disaffection with the economic catastrophe that had befallen them by demonstrating, publicly rebuking members of the political class, even occasionally beating them. Yesterday, they finally got the chance to punish their politicians, in particular those of PASOK and Nea Demokratia-the two parties which had alternated in power for the past four decades-at the ballot box. They certainly got their revenge. But the cost of their choice may well be too heavy for them to bear.

The two parties-which backed the government led by technocrat Lucas Papademos responsible for Greece's second bailout agreement-were pummeled at the polls. In the last parliamentary election in October 2009, their combined share of the vote was 77 percent. On Sunday, they eked out 32 percent. Nea Demokratia topped voters' preferences, but its share of the vote-18.9 percent-was barely more than half of its 2009 performance, its worse ever until yesterday. PASOK, which led the country into the embrace of the IMF and its European official lenders, fell to third place with 13.2 percent-less than a third of its percentage in 2009.

Second place was captured by SYRIZA, a coalition of left-wing elements under the leadership of Alexis Tsipras, the dark-haired 37-year old firebrand for whom yesterday's election was an unadulterated triumph. SYRIZA, which struggled to enter parliament last time around (there is a 3 percent threshold), this time came within 2 percentage points of first place. They did this on the back of an unabashedly leftist-populist campaign, during which Tsipras vowed to reject the new loan agreement, refuse payment on the part of Greece's public debt that would be judged to be "odious," and hire 100,000 people to the already bloated public sector (current workforce: about 700,000).

The rest of the new parliament, which may manage just one session before it is dissolved again for another election, is not made up of forces conducive to Greece's continued membership in European institutions. There is, for example, the Communist Party, which demands the nationalization of everything and an exit from the European Union and the euro. Or there is the far right party of the Independent Greeks, whose leader regularly calls the heads of Nea Demokratia and PASOK traitors and claims that the country is under occupation by Germans and "international lonesharks" (he means the banks).

But far worse than either of these is Golden Dawn, a violent, Nazi-inspired group of skinheaded bullies that exploited the uncontrolled influx of illegal immigrants into Greece, the state's inability to protect citizens from crime in the poorer neighborhoods of Athens, and the depth of the economic crisis to enter parliament for the first time-in decisive fashion. Early last night, when it had become clear that the group would get close to 7 percent of the vote-they ended up with 440,000 votes, from a mere 20,000 two-and-a-half years ago-its leader, Nikos Michaloliakos made a hysterical appearance on TV, quoting Julius Caesar, lashing out at the media, the president of Nea Demokratia, immigrants, and just about anyone else, and telling "those who betray our country" that "they should be scared! We are coming!" His raving speech had been preceded by the expulsion of Greek journalists from the room, because they refused orders to stand when he enterred.

The one smaller party that made it into parliament which could be a force for stability is the Democratic Left, a moderately left-wing party whose rhetoric places it in the pro-European camp. But its president, Fotis Kouvelis, has already stated twice since yesterday that he will not participate in coalition government with Nea Demokratia and PASOK.

Without him, the two former parties of power don't have the seats they need to get a vote of confidence in parliament. According to the Greek constitution, if the party that came in first in the polls cannot form a government, the mandate goes to the runner-up, and then to the party that finished third. Tsipras has said Sunday night that he will try to form a government with the parties of the Left aiming to repeal the loan agreement. However, because of a thoroughly undemocratic clause in Greece's electoral law, which awards the first party 50 additional seats beyond its proportional share, he doesn't have the numbers. That means that, realistically, only Nea Demokratia can lead a new government. If Samaras fails, there no way out other than another round of elections, to be held probably on June 17.

It is hard to overstate the danger this poses to Greece's continued membership of the euro. The country has committed itself to spending cuts worth 11.5 billion euros for 2013-4. The relevant measures need to be adopted by the end of June. A new election would mean that these measures would at best be delayed, which itself would mean that the next installment of the second bailout, due in August and worth up to 29 billion euros, would not be disbursed on time. As a result, crucial elements for the revival of the moribund Greek economy, set to shrink by more than 5 percent this year, like the recapitalization of the banks and the repayment of the government's debts to private contractors (more than 6 billion euros), would also be set back.

The worse case scenario is a June election which brings the forces of reactionary populism, led by SYRIZA, to power. Tsipras claims to be pro-European but his policies all but guarantee a Greek exit from the common currency, no matter how much Francois Hollande changes the climate in Europe. In that case, there will be hell to pay-for the eurozone, but above all, for Greece.

UPDATE: Antonis Samaras, leader of Nea Demokratia, officially returned the mandate to the president of the Republic a little while ago, having failed to secure the necessary agreements that would allow for the formation of a new government. The torch now passes to Tsipras, who is unlikely to be able to do so either. New elections are looking increasingly likely.