The immediate and obvious mulligan is a new national election. The teed-off Greek electorate teed up on May 6, but fractious voters produced a scattershot result. No single party achieved a parliamentary majority.
The leaders of Greece's three largest political parties subsequently failed to form a coalition government.
Their disagreements are fundamental. During the coalition discussions, the Syriza Party (Coalition of the Radical Left/Unitary Social Movement) announced it would not participate in any government that imposed austerity. Austerity is shorthand for economic reform, budget cuts and debt reduction, the policy regimen the eurozone's productive economies (led by Germany) and international lenders require in exchange for further loan guarantees and economic assistance.
Syriza's no-austerity leaders, however, argue that Germany and France will balk when they actually face a eurozone breakup. The Syriza-istas argue the election of French Socialist President Francois Hollande demonstrates a "shift to the left" in France that they contend (or pray) will weaken German demands for Greek debt reduction. While on the campaign trail, Hollande claimed he did not favor austerity measures, or at least he didn't favor harsh austerity measures.
Syriza's no-austerity pitch appeals to the Greek electorate's understandable anger at economic decline and frustration with complex reform measures. However, it also plays to and sadly encourages a far less justifiable sense of national resentment and victimization. No one likes to be told they must work hard, cut spending and do without. No-austerity politicians play to this human preference. Ultimately, Syriza counts on Santa Claus. Gifts will come down the chimney. Someone else, from the North Pole (or Northern Europe), will pay the bills.
In contrast, the New Democracy Party (center-right) and PASOK (Greek socialist party) think the Germans mean what they say about no more loans unless Greece lives within its means. The Germans demand honest money. New Democracy and PASOK are committed to keeping Greece in the eurozone. Greece, they argue, gains political clout and economic stability from being in the European Union and the eurozone. Remaining in the eurozone requires fiscal restraint and budget reform, which means accepting austerity.
Some PASOK supporters, however, condemn austerity. Conservative factions who see austerity as an affront to Greek nationalism have quit New Democracy.
Austin Bay is the author of three novels. His third novel, The Wrong Side of Brightness, was published by Putnam/Jove in June 2003. He has also co-authored four non-fiction books, to include A Quick and Dirty Guide to War: Third Edition (with James Dunnigan, Morrow, 1996).
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