EKIP– Expert Club for Economics and Politics A Different Opinion
Greece wants the euro, but it doesn't want euro conditions. This impasse defines the entire political process in our southern neighbor as an endless and painful maneuvering between popular and European discontent.
The elections in France clearly showed the complex state the European Union is in. However, the electoral failures of the main parties in Greece painted a completely complete picture of the political chaos.
The parliamentary elections on St. George's Day ended the illusion that moderate ideas and political compromise could achieve a slow and orderly exit from the crisis. Greek voters harshly punished parties willing to accept the European Union's conditions for further budget cuts and further increases in the tax burden.
The attitudes of the Greek people can be briefly summarized in one sentence: Greece wants the euro, but it does not want euro conditions. This impasse defines the entire political process in our southern neighbor as an endless and painful maneuvering between popular and European discontent.
The second is itself caused by the tied hands of politicians to implement any reform. The term “reform” scares every Greek standing at the ballot box, since the majority of reforms carried out in Greece are aimed at aligning public sector wages with labor productivity. It is precisely because of the “reforms” enshrined in the election platforms that the most stable Greek parties were severely punished and permanently lost the trust of many of their supporters. The EU followers became political outsiders in the elections, winning a total of only about 40% of the votes.
The striking difference between trust in pro-European leaders in the previous and this year's elections is clearly visible in Chart 1.
Chart 1: Results of PASOK, New Democracy and LAOS in the Greek parliamentary elections in 2009 and 2012
Gradually, trust in pro-European politicians was replaced by a wavering towards populist and radical parties rejecting the dictates of the Troika. The far left and right are the real winners, considering that the coalition of the radical left came in second place, and in sixth place (but with a sufficiently high vote) – the neo-Nazis from New Dawn. In all elections to date (with the exception of 1990-1991), one of the two leading parties, PASOK or New Democracy, has been able to win a large enough majority in parliament to form a single-party government. Until now, the two parties have always had a combined 70 to 90% of the vote. In this year’s elections, their combined result is only 33% (see Chart 2).
Chart 2: Election results in Greece
Many analysts say that it is already too late for any political measures in Greece. The top three parties have been unable to form a government, the Greek state is set to run out of money by the end of June, and reform to prevent bankruptcy cannot happen in a country without government. In this situation, the Greek president has one last chance to negotiate with the party leaders and convince them to reach a compromise on a cabinet. Even the president of the European Parliament, Martin Schulz, has announced his intention to visit Greece and cooperate in the negotiations. If this step fails, the next elections will be held in June - precisely at the moment when the country will practically be on the verge of bankruptcy.
Taking stock, analysts have even coined a new term for the Greek impasse – “Grexit,” from “Greece” and “exit.” The ultimate conviction that the exit of countries from the Eurozone is a last resort is shaken more than ever.
Hello Ms. Teodora Angelova,
The contemporary European "political chaos" is a direct result of an existing public financial error, which is a particularly important cause of the development of an economic crisis.
The reason for the development of the current European economic crisis is UNSUITABLE for Euro public financial management.
Under these circumstances, it does not matter whether the politicians are "left" or "right," because they are doomed victims of poor financial management, and the more they work, the greater their failure.
The pattern is:
In the case of state financial management unsuitable for "Non-gold money":
1. Disproportions develop in the relevant economy.
2. The more the ruling politicians support economic life and greater added value is realized, the more these disparities grow.
3. Increased disparities create difficulties and (after enough time) crisis.
The premise for this management error is disregard for the qualities of the euro.
Due to the state's financial deficit, when more added value is realized, larger imbalances are created, which develop a stronger crisis with increased painful damages for participants in economic life.
As in other European countries, the economic crisis in Greece is developing due to a lack of financial management suitable for the European Union.
The crisis continues as the financial error persists.
By origin, the current economic crisis in Greece is primary, as it is the result of the direct influence of only one particularly important cause.
Salvation is possible - the cause (Greek financial management unsuitable for the euro) is stopped and the danger of a Greek crisis developing will be eliminated.
Within 24 hours of the cessation of inappropriate government behavior and the use of EURO-FRIENDLY Greek financial management - the crisis in Greece will be eliminated.
Example: If Greece had improved its financial management and was also eligible for the euro, this country would have an increased ability to pay its debts on time and holders of Greek government debt would not suffer damages of over 100 billion euros.
In an economy with "Non-gold money" in a given country, successful political behavior is possible only with state financial management that is SUITABLE for an economy with this money.
Respectfully,
Ivan Mitev