Long Economic Crisis Set to Usher In New Leadership in Greece


ATHENS — Greeks are hurting and angry after a decade of brutal austerity and Prime Minister Alexis Tsipras looks headed to pay the price by losing control over the government in Sunday’s national elections.

Exit polls released when the voting closed at 7 p.m. local time predicted Mr. Tsipras’s leftist Syriza party would lose to the center-right New Democracy party, which promises tax cuts and new prosperity. The polls were released by private news station Skai.

[Greek election results: Prime minister Alexis Tsipras concedes defeat as center right surges.]

Mr. Tsipras’s supporters argue that after years of austerity, he has lifted the country out of the depths of the financial crisis and the economic picture has improved. But critics say his tenure as prime minister has been disastrous for entrepreneurship, crushing the middle class and eroding the rule of law.

A second crisis that looms large in the election is the thousands of migrants languishing in tent camps in Greece while they await the processing of their asylum applications.

Polls predict voters will choose the center-right New Democracy party, led by Kyriakos Mitsotakis — the son of a former prime minister and member of one of Greece’s main political dynasties. But he would have to secure an absolute majority in Parliament to form a government without a coalition partner, which could limit his ability to push through his agenda.

One major loser in this election could be Golden Dawn, the anti-Muslim party that the Council of Europe’s human rights commissioner described in 2013 as “neo-Nazi and violent.”

The party, which rose to prominence in the last electoral cycle and became the third-largest party in the Greek Parliament, would have to pass the threshold of 3 percent of the popular vote to make it into the 300-seat Greek Parliament. But some polls predict that it will fall short.

A gaggle of other small political parties are also vying for spots, but they, too, would have to pass the threshold to qualify.

When it comes to the lingering pain of austerity, Mr. Mitsotakis has been crisscrossing the country, promising relief — and his message is resonating.

While the country is clearly recovering from the depths of the financial crisis, Greece’s tepid growth, about 2 percent, is not nearly enough to reverse the pains of the height of the austerity era.

The last Greek vote of note was four years ago nearly to the day. On July 5, 2015, Mr. Tsipras pushed the country to the brink, shutting down banks and imposing capital controls after he decided to hold a referendum asking Greeks whether they wanted to break away or stay in the euro and shoulder more austerity in exchange for billions more in bailout funds from the eurozone countries and the International Monetary Fund.

Voters overwhelmingly rejected the bailout terms, which was what Mr. Tsipras had campaigned for, but he ignored them. He went on to win a national election in September 2015.

And in the years that followed, he became a trusty ally of European and international policymakers who demanded certain legislation be passed in order to release bailout funds for the crushed Greek economy.

But the new normal in Greece is a significantly poorer population, with vital public services such as health care and education trimmed to the bone after rounds of funding cuts to meet austerity targets. And unemployment is still hovering at more than 18 percent, a startlingly high figure for a European Union country.

Another important factor in this election, and a major challenge for the new government, is taxation. High income and property taxes have decimated the Greek middle class and businesses.

In addition, Greece’s public finances are still shaky. With a debt-to-gross domestic product ratio of close to 180 percent and a massive bailout bill to repay, the new government will have to balance fiscal prudence with stimulus to boost growth and job creation.

Both big political parties, despite being worlds apart ideologically, seem to agree that something must be done to cut back on how much of citizens’ dwindling earnings the state takes. How to do this is a matter of some debate, given that Greece still needs to meet stringent fiscal targets, keep spending in check and boost public revenue.

But over all, things could be looking up. The Greek stock market has been rallying this year, and the expectation of a pro-market government is trimming Greek borrowing costs, although the country’s bonds are still junk-rated, meaning only the bravest investors are interested in buying them.

In the past four years, Greece has been hit by a migrant crisis that brought an influx of hundreds of thousands of refugees from Syria and other countries across its borders.

After a crackdown at internal European borders to prevent asylum seekers from reaching the continent’s wealthier nations in the north, some 16,500 asylum seekers have been stuck on Greece’s Aegean Islands in squalid conditions. Human Rights Watch recently called it a “forgotten emergency.”

The refugees have to wait for months, or even years, for their asylum requests to be processed. In the meantime, the most vulnerable among them, including thousands of children, need services and support.

Bitter debates have erupted across the country over ensuring that asylum applications are processed swiftly and that refugees have access to education, health care and decent living conditions. Many people, including some from Mr. Mitsotakis’s party, say refugee children should not receive services available to Greek children.

The new government will have to tackle these issues head on before another winter sets in for refugees living in tents.

Source : Nytimes