Giulia Guazzaloca - 19/06/2012

     Not since the golden age of classical Greece, maybe, have the eyes of the world trained so intently on the Greek peninsula. Only one thing seemed certain in the build-up to Greek polling day, 17th June: after the failure of May elections, the issue this time hung between the conservative party New Democracy, who are for keeping to the commitment with Europe and the international community, and the radical left wing, Syriza, whose leader Alexis Tsipras has repeatedly stated he wanted to cancel the “memorandum for bankruptcy” drawn up with the EU and IMF. The vote did indeed split, but in the end Antonis Samaras’ New Democracy carried the day with about 30% of the ballot. Picking up a winners’ reward of an extra 50 seats, he is now poised to form a coalition government, probably with Pasok’s socialists (12.5%).

     In the electoral campaign the ND leader rode the coming ballot as a straight referendum: Euro versus drachma. He now expresses satisfaction that “the Greeks have chosen to stay in the Euro” and has assured the EU he will be sticking to agreements, albeit initiating negotiations to “get back some prospect of growth”. ND’s main adversary Syriza, for a party which came into being a mere year ago, has achieved the excellent result of 26% of a national ballot. Among the other groups – 21 ran in these elections, fielding something over 4,800 candidates – the Independent Greeks polled 7%, Alba Dorata’s neo-Nazis 6.9%, Democratic Left 6% and the Communist Party 4%.

     The international political reaction has been unanimous contentment, and the same goes for the markets, to judge by preliminary signs: the Tokyo stock exchange was up by 1.77% and the Euro was being traded on the Australian market at 1.273 dollars. There has been general relief in Italy too at this election outcome. Premier Monti, away in Mexico for the G20, said it was a major victory for Europe: the birth of a stable government in Athens would nudge the European agenda in the direction of greater growth and hence offer “a more serene vision of the EU and Eurozone future”: However, though the risk of Athens ditching the Euro has been averted, the outcome to Sunday’s election leaves many questions unanswered, and these will weigh chiefly on the weaker economies of Europe, such as Italy and Spain.

     On the economic-financial front, the markets are likely to continue wayward: the emergency has not passed and, say the economists, if progress is not made on the Eurozone debt crisis or measures taken to redistribute the risk by the G20 and late-June European Council, the economies will remain perilously exposed to stress. On the Greek political front, negotiations to form a new executive will prove complicated. ND and Pasok will have to decide whether to include Democratic Left in the coalition: that would secure another 15 MPs. The socialists and conservatives will also have to regain people’s trust: it was they, after all, who were chiefly responsible for the country’s accounts collapsing in the recent past.

     It remains to be seen what kind of opposition Syriza and the unions will manage to assemble to challenge the solvency measures the new government will be presenting. Parliament will also have to cope with the disquieting presence of a neo-Nazi party which gained no less than 18 seats and made inroads into the younger generation above all. The Greek drama does suggest some parallels with the Italian situation, although the Italian economy is stronger now than it was six or seven months ago and probably clear of the risk of bankruptcy. As in Greece, however, the Italian left is deeply divided which, in the past, tended to blight the prospects of stable government.

     Another parallel with Greece: Italy’s current difficulties are due to uncontrolled public overspending, a high degree of corruption and widespread tax evasion. Italy too (though the same could be said for many a European country) contains its own swath of Euroscepticism and overt anti-Euro feeling. Ex-premier Berlusconi himself is on record as saying a few days ago that if the anti-Euro parties won the day in Greece, it would be a major signal that “divorce is possible”. Whatever the differences, the future Greek coalition is going to encounter difficulties similar to Monti’s government since it will have to reckon with an extremely mixed parliamentary majority. There are also many similarities between Syriza and Movimento 5 Stelle.

     Syriza is a new bottom-up “experiment” which has attracted the young vote above all and uses the language of patriotism and participatory democracy against the financial “dictatorship” of the banks and international institutions. Recent administrative elections in Italy showed that the “anti-system” vote was on the increase. This indicates not just how low the traditional party system has sunk in credibility, but how afraid and undecided people are at this juncture of the economic crisis. The same fears and uncertainties lie behind the Greek success of Syriza and Alba Dorata. Italy is not Greece, of course. There were economic differences right from the outset of this recession.

     But Italy is going through a serious political crisis, its parties barely command citizen support and are certainly failing to solve the people’s problems. Lacking all confidence, the electors are choosing not to vote, or are falling for the lure of populism and anti-Europeanism. Entrepreneurs in debt are beginning to take their own lives. One wonders what would have happened in Italy had the situation got out of hand and the same drastic and dramatic medicine been meted out as in Greece.

Giulia Guazzaloca
(Bologna University)