Greek Local Elections Could Force Fresh Polls
By ALKMAN GRANITSAS And NICK SKREKAS
ATHENS—Greek voters go to the polls Sunday in fraught local elections widely seen as a referendum on the government's tough austerity program. Poor results could force the ruling Socialists to call new nationwide polls after only a year in office.
In the past two weeks, Prime Minister George Papandreou has said he would seek a fresh mandate for his government if voters don't back his party's candidates Sunday—a prospect that has unsettled the country's financial markets and drawn veiled criticism from Greece's international lenders.
The elections come amid growing discontent over the government's harsh economic measures and even as Greek authorities deal with a spate of mail bomb attacks by a far-left extremist group that has targeted foreign leaders and institutions across Europe. On Thursday, Greek police charged two men in connection with the terrorist plot and intercepted a 14th booby-trapped parcel in the capital.
Voters who have already endured a grinding, two-year economic slump now worry that both the recession and the current austerity measures will continue for months to come with no immediate signs of recovery.
"These elections are taking place amid a very negative environment for public opinion," said George Kyrtsos, a political commentator and publisher of the City Press newspaper. "People understand that the measures are necessary, but they also need to see some light at the end of the tunnel."
In May, Greece narrowly avoided bankruptcy with the help of an €110 billion bailout from the International Monetary Fund and European Union in exchange for a three-year austerity and reform program. That program has led to steep cuts in pensions and public-sector salaries, as well as a raft of new taxes on everything from cigarettes to basic foodstuffs.
The measures have drawn the ire of Greece's unions and led to repeated strikes and protests around the country.
At the same time, the program has weighed on the economy, which is expected to shrink by 4% this year, while unemployment has rocketed to 12% in July from 9.6% a year earlier and business bankruptcies have soared.
But even amid the discontent with the Socialists' economic policies, many voters are also unhappy with the opposition, center-right New Democracy party which they blame for mismanaging the economy during their five-and-a-half years in office. Analysts say that Sunday's polls may be marked by a high level of abstentions and protest voting as Greeks turn their backs on both of the major parties.
"I am not going to vote at all and I've been trying to convince my friends not to go either because I don't believe anything Greek politicians say anymore. Look at the state that they have created in this unfortunate country. I want to send them a message that they all should all apologize and quietly go home," said 54-year-old plumber and father of two Vassilis Babatsias. "I came back from Sweden three years ago hoping I could raise my kids here and have an average, middle-class life. I have bitterly regretted the day I booked my ticket."
According to public-opinion polls from early October, the Socialists have continued to enjoy a solid lead of six to 14.5 percentage points over New Democracy.
But officials from both parties say that lead has shrunk in the past several weeks and is one factor that prompted Mr. Papandreou to raise the specter of snap national elections late last month—a move analysts say may have backfired.
Since then, the prospect of political instability in Greece has spooked investors.
In the past two weeks, the Athens stock market has fallen about 8%, while the spread between interest rates on 10-year Greek government bonds and their benchmark German counterparts has jumped from about seven percentage points to 8.8 percentage points.
"On Sunday, the prime minister will decide whether to proceed with snap national elections. If voters reject the government outright, then it will have no choice," said one political analyst close to the ruling Socialists. "If the voters do reject the government, the opposition will say it has lost its mandate. So better to go ahead with a new election rather than face constant doubts about its reform initiative."
What is less clear, however, is what will decide the margin of victory for the government. Because of the diffuse nature of the local elections—which are being conducted under new election laws and following a sweeping reorganization of Greece's municipalities—the results could be murky.
In the country's two major cities—Athens and Thessaloniki—New Democracy looks poised to retain its command of the local town halls, as well as the region of central Macedonia where the incumbent New Democracy candidate continues to enjoy strong support.
However, in other places, such as the Athens port of Piraeus and the city of Heraklion in Crete, the Socialists look favored to win. And in the all-important province of Attica—the region surrounding Athens and where almost half the Greek population lives—a local maverick is in the lead, but his Socialist opponent appears to be gaining ground and may force him to a second-round vote the following Sunday.
More significant, according to insiders at both parties, will be the overall vote totals on a national basis. People within the government say that they consider a 3% margin—tallied on a national basis—a victory.
"It's such a fluid election, with so many faces across Greece up for election, that it's really hard to predict, or even set a target on what would be a victory or defeat," said a New Democracy insider. "Both major parties will be looking at their percentages in the first round to judge how they are going."
"No one can currently predict whether in the end it will be a mass protest vote or just how many Greeks will abstain and completely turn their backs on the political system," he added. "One thing is for sure, Papandreou's bluff of early elections doesn't seem to be working from what we see."
(The Wall Street Journal)
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