Both the Economics and Politics of Austerity Fail
The results of the June 17th vote are now known. Greece should be able to form a fragile coalition government with center-right New Democracy earning 129 seats in parliament, putting them in a majority if they bring in center-left PASOK and their estimated 33 members of parliament. PASOK wishes to maneuver SYRIZA into the coalition so that the surging left-wing party shares the political price of austerity. I can’t imagine SYRIZA falling for this, they already stated they won’t take a mandate to form a government, essentially calling shotgun on parliamentary opposition.
This sets the stage for more turmoil in Greece. PASOK can insist on a unity coalition including SYRIZA but it will easily relent and back or at least enable New Democracy to govern the country. This is where events fall into the hands of European officials. Absent more forgiving conditions on austerity, additional measures will have a difficult course through this parliament with New Democracy needing votes from other parliamentary factions, factions who stand to make political gains by voting against austerity. PASOK has long carried the weight of passing austerity and it will be expected to do so once again. Absent those concessions from Europe, it’s hard to see PASOK hold its nose and voting for more austerity that will repulse remaining supporters to anti-bailout parties.
This takes us back to SYRIZA. The party should benefit from opposition as forces inside and outside Greece were setting it up to take the blame for the economic collapse, a collapse provoked not from people casting ballots for SYRIZA but by politicians and technocrats grasping austerity knifes. For a month, the Greek public was terrorized with Euro exit threats by New Democracy and European officials who seem ready to scream fire in a crowded movie theater if it achieves their political objectives.
For the next few days much attention will be given to coalition negotiations. This won’t be inconclusive like last time. In May, New Democracy and PASOK couldn’t reach the 151 MP mark to have a majority in parliament. Those two parties are safely past that 151 mark this time. But the consequences of the first round election hold with the second round. Greece’s political class consists of the walking wounded. They avoided annihilation but are unable to reclaim lost ground. PASOK, who governed until last November, lost more voters this round even after losing more than two-thirds of their support in the first round election. It’s unmistakable for me, momentum rests with SYRIZA and Syntagma Square. The protesters since 2010 suffered police beatings to make the point that austerity won’t work. Austerity already failed economically, it now fails politically.