Monday, January 26, 2015

SYRIZA makes a governing coalition in Greece/Alexis Tsipras sworn in as Prime Minister

Alexis Tsipras is the new Prime Minister of Greece in a coalition with the Greek Independents (ANEL), which has taken "rightwing populist" positions which on some issues are very distinct from those of SYRIZA.

Tsipras doesn't wear a tie in his public appearances, even at his searing-in as Prime Minister. It's not because he's a hippie throwback. It's because he's pledged not to wear a tie until Greece has achieved a reduction in its sovereign debt. (Sebastian Gierke, "O Alexis" - Ein Revoluzzer triumphiert Süddeutsche Zeitung 26.01.2015) It's kind of like Johnny Cash dressing in black.

This is a Euronews report on SYRIZA's win, Greece's Syriza juggling the promises it made 01/26/2015:

Spiegel Online describes the junior coalition party, ANEL, this way (Parlamentswahl in Griechenland: Die Ergebnisse im Überblick 25.11.2015):

Die Führung der rechtspopulistischen Partei, einer Abspaltung der konservativen Nea Dimokratia, sieht das Land "besetzt" von den Geldgebern. Daher müsse Griechenland "befreit" werden. Athen sollte keine Schulden zurückzahlen.

[The leadership of the rightwing populist party, a split from the conservative New Democracy {ND had the outgoing Prime Minister}, sees the country "occupied" by the money lenders. Greece has to be "liberated" from them. Athens shouldn't pay back any of its debts.]
To be clear: this is not the more-or-less overtly neo-Nazi party Golden Dawn that we've heard so much about in the press. Golden Dawn came in third on Sunday with 6% of the vote but lost a Parliamentary seat and about half a percentage point from the 2012 election. (For the vote and Parliamentary seat percentages, I'm relying here on the Spiegel article just linked from around 9:00PM on Sunday.)

Parliament has 300 seats and SYRIZA fell two seats short of a majority with 149. ANEL brings 13 seats, so they will be very much a junior coalition partner.

It's not surprising that SYRIZA would not form a coalition with either of the two parties that formed the outgoing government: New Democracy (conservative; 76 seats) and PASOK (social democratic; 13 seats). Golden Dawn (17 seats) was out of the question because of their anti-democracy politics. To Potami (17 seats), a party with a reputation as pro-European technocrats and the Communist Party (KKE; 15 seats) were the only two other possible coalition partners.

Eleni Chrepa in Greece’s Political Parties: a Brief Guide to Who’s Who Yahoo! Finance/Bloomberg News 01/24/2015 describes Potami this way:

Founded in February 2014, To Potami illustrates the fracturing of the Greek political landscape that has accompanied the upheaval in society caused by economic recession and record unemployment. Led by Stavros Theodorakis, a former journalist born in 1963, To Potami, or "The River," has a shot at power less than a year after its formation. Theodorakis has pledged to focus on social policy and relief for those on lower incomes and to keep the country within the euro area. To Potami says it would cooperate with either Syriza or New Democracy to form a coalition government and secure stability for the country.
Chrepa's description for the KKE:

Led by Dimitris Koutsoubas, 59, who replaced Aleka Papariga in 2013, KKE is the oldest political party in Greece, founded in 1918. KKE is opposed to the austerity measures and bailout terms. It wants Greece to leave the euro area, the EU and other international institutions. Koutsoubas, whose party took 4.5 percent of the vote in the June 2012 elections, has ruled out participating in a coalition with any of the parties.
I'm guessing that the fact that Potami was a new party combined with their expressed willingness to make a coalition with the leading pro-austerity party, New Democracy, largely ruled them out for a coalition that will have to confront heavy-handed German pressure from Day 1.

The KKE seems to be in a sectarian mode and they were flatly ruling out a coalition. That pretty much left ANEL, whose priorities seem very similar to SYRIZA's on staying in the EU and the eurozone while renegotiating the debt. The fact that ANEL was calling for 100% debt relief may strenthen Tsipras' hand in the negotiations. Chrepa desribes ANEL this way: "Led by Panos Kammenos, 49, Independent Greeks is an anti-bailout party created in 2012. The party has said Greece should renounce its debt and tear up the bailout agreement, all while staying within the euro area. Kammenos, a former New Democracy lawmaker, has said he is willing to cooperate with Syriza to form a coalition government."

With 13 seats to SYRIZA's 149, ANEL will be very much a junior partner. As David Böcking und Giorgos Christides explain in Neue Regierung in Griechenland: Ein schräges Paar Spiegel Online 26.01.2015, SYRIZA and ANEL have very different positions on immigration, the establishment of religion (SYRIZA wants to reduce the formal role of the Greek Orthodox Church), tax policy and their general expressed attitudes toward the One Percent. ANEL leader Kammenos is a former Deputy Minister of Shipping who is presumed to be friendly toward the shipping industry.

Joe Stiglitz talked about Greece's situation on Monday on CNBC: Matthew Belvedere, Nobel winner: Germany's the problem, not Greece 01/26/2015. Joe Stiglitz on Greece's situation. This is from CNBC, and It was kind of an unusual moment for CNBC. Of the three interviewers quizzing Stiglitz, only two seem to be clueless on the subject they are discussing.

Another Nobel laureate economist and public intellectual, Paul Krugman, also looks at Greece today and compares it's actual economic performance under austerity to that predicted by the Troika that imposed it in 2010. In Ending Greece’s Nightmare New York Times 01/25/2015, he writes:

So now that Mr. Tsipras has won, and won big, European officials would be well advised to skip the lectures calling on him to act responsibly and to go along with their program. The fact is they have no credibility; the program they imposed on Greece never made sense. It had no chance of working.

If anything, the problem with Syriza’s plans may be that they’re not radical enough. Debt relief and an easing of austerity would reduce the economic pain, but it’s doubtful whether they are sufficient to produce a strong recovery. On the other hand, it’s not clear what more any Greek government can do unless it’s prepared to abandon the euro, and the Greek public isn’t ready for that.
The last comment indicates to me that Krugman may not have a good understanding of SYRIZA's position on renegotiating its agreements with the Troika. Greece's negotiating strength is based on the fact that they can put Merkel and Germany in the position of forcing their exit rather than triggering it themselves. They have good reason to believe, and this is their public position, that Greece is better off in the eurozone and the EU than outside. If they can't reach an agreement with Germany, and Germany convinces the EU to expel Greece, and a precedent for a country exiting the euro will be set. In itself, that won't force any other countries to leave. But Merkel has to fear that it will create a rush for the exit among other periphery countries.

No comments: