Skip to main content

Greek politicians, don't destroy your nation's future

By Yannis Palaiologos and Theodore Pelagidis, Special to CNN
updated 7:16 AM EDT, Tue May 8, 2012
An employee walks by an index at Athens stock exchange on May 7.
An employee walks by an index at Athens stock exchange on May 7.
STORY HIGHLIGHTS
  • Parliamentary election in Greece delivered a crushing blow to the two dominant political parties
  • Yannis Palaiologos and Theodore Pelagidis: Expect uncertainty and frustration
  • Palaiologos, Pelagidis: If parties fail to form coalition, businesses, economy will suffer
  • They say that the future of Greece depends on the ability of its politicians to come together

Editor's note: Yannis Palaiologos is a journalist in Athens, Greece. Theodore Pelagidis, a professor of economics at the University of Piraeus, is the co-author of 'Understanding the Crisis in Greece: From Boom to Bust."

(CNN) -- Sunday's parliamentary election in Greece delivered a crushing blow to New Democracy and Pasok, the two dominant parties that have ruled the country for the last 37 years. In the coming weeks, expect uncertainty, shifting alliances and growing frustration as a new political landscape struggles to emerge from the wreckage of the old.

As the main backers of Greece's second bailout and the harsh austerity measures that accompanied it, New Democracy and Pasok saw their combined share of votes plunge, as angry voters punished them for two years of wage and pension cuts and rising taxes. Pasok, in particular, which won a landslide election in 2009 and made the fateful decision to seek the financial assistance of euro zone partners and the International Monetary Fund in 2010, saw its support collapse.

Coming in second at the polls was Syriza, a left wing party fiercely opposed to privatization, public sector spending cuts and labor market reform. The other four parties that garnered enough parliamentary votes, ranging from the unreconstructed Communists to the pro-Nazi thugs of Golden Dawn, are also opposed to further austerity.

Yannis Palaiologos
Yannis Palaiologos

What will happen next will depend on the ability of the frontrunners to form a coalition government made up of pro-European forces that will meet the conditions set by Greece's official creditors for the disbursement of further funds.

Theodore Pelagidis
Theodore Pelagidis

These conditions include the adoption of spending cuts worth 11.5 billion euros for 2013-2014 by next month, as well as quick progress in privatization and the opening up of closed professions, two areas in which neither the former nor current prime minister made any significant headway.

Antonis Samaras, head of New Democracy, said initially that his party was willing to lead a coalition government with the aim of keeping Greece in the euro zone and amending the policies of the loan agreement so that they could promote growth. But he has relinquished the mandate to form a government after talks broke down with the leaders of other parties, including Syriza, Pasok and the Democratic Left.

Follow @CNNOpinion on Twitter and Facebook.com/cnnopinion

Greece searching for a solution
Markets spooked by Greek political limbo

Syriza, the real winner in the election, has made it clear that it plans to reject the new loan agreement and come to a new understanding with Greece's euro zone partners. This position makes it hard for it to take part in a national unity government that would include New Democracy or Pasok.

At this point, it appears more likely that the parties will fail to form a coalition and Greece will be led down the treacherous path to new elections in June. This would entail a delay in the adoption of a new package of spending cuts, which in turn will mean that the next installment of the loan, due in August and worth up to 29 billion euros, will also be set back.

A political stalemate will delay both recapitalization of the Greek banks and repayment of more than 6 billion euros owed by the government to private contractors. The consequence is that Greek businesses, including healthy ones, will be deprived of much-needed oxygen.

In a country that is in its fifth consecutive year of recession and with an economy expected to shrink by more than 5% this year, this mess will cause any green shoots of recovery to wilt and die.

However, the victory of Francois Hollande in the French presidential election has sent a breeze of hope throughout the euro zone. Many expect, perhaps too optimistically, that France's new leader will convince Angela Merkel of Germany to temper her obsession with austerity in the European economy. It is hoped that she may give her consent to the issuing of euro bonds to promote infrastructure investment, complement the recently agreed fiscal compact with pro-growth measures and perhaps, less realistically, accept a plan to allow the European Central Bank to lend directly to fiscally troubled countries.

From Greece's vantage point, these are positive developments. But they will all be for naught unless the Greek political system can form a viable government that will implement the commitments it has undertaken -- properly amended in ways that Greece and its lenders can agree on -- and set the foundations for the transformation of the Greek economy to allow it to benefit from any improvement in Europe's prospects.

It is a tall order. And Greek politicians have shown little evidence of their ability to shoulder it. But the future prosperity of Greece, as well as the stability of the European Monetary Union, depends on their success.

Follow us on Twitter @CNNOpinion

Join us on Facebook/CNNOpinion

The opinions expressed in this commentary are solely those of Yannis Palaiologos and Theodore Pelagidis.

ADVERTISEMENT
Part of complete coverage on
updated 12:42 PM EDT, Wed April 16, 2014
Rick McGahey says Rep. Paul Ryan is signaling his presidential ambitions by appealing to hard core Republican values
updated 11:39 AM EDT, Wed April 16, 2014
Paul Saffo says current Google Glasses are doomed to become eBay collectibles, but they are only the leading edge of a surge in wearable tech that will change our lives
updated 2:49 PM EDT, Tue April 15, 2014
Kathleen Blee says the KKK and white power or neo-Nazi groups give haters the purpose and urgency to use violence.
updated 7:56 AM EDT, Wed April 16, 2014
Sen. Sheldon Whitehouse and Rep. Henry Waxman say read deep, and you'll see the federal Keystone pipeline report spells out the pipeline is bad news
updated 7:53 AM EDT, Wed April 16, 2014
Frida Ghitis says President Obama needs to stop making empty threats against Russia and consider other options
updated 5:29 PM EDT, Tue April 15, 2014
Peter Bergen and David Sterman say the Kansas Jewish Center killings are part of a string of lethal violence in the U.S. that outstrips al Qaeda-influenced attacks. Why don't we pay more attention?
updated 12:41 PM EDT, Tue April 15, 2014
Danny Cevallos says families of the passengers on Malaysian Airlines Flight 370 need legal counsel
updated 11:23 AM EDT, Mon April 14, 2014
David Frum says Russia is on a rampage of mischief while Western leaders and Western alliances charged with keeping the peace hem and haw
updated 7:56 AM EDT, Mon April 14, 2014
Most adults make the mistakes of hitting the snooze button and of checking emails first thing in the morning, writes Mel Robbins
updated 1:54 PM EDT, Mon April 14, 2014
David Wheeler says as middle-class careers continue to disappear, we need a monthly cash payment to everyone
updated 7:55 AM EDT, Mon April 14, 2014
Democrats need to show more political spine when it comes to the issue of taxes.
updated 11:55 AM EDT, Mon April 14, 2014
Donna Brazile recalls the 50th Anniversary of the Civil Rights Act as four presidents honored the heroes of the movement and Lyndon Johnson, who signed the law
updated 9:17 AM EDT, Mon April 14, 2014
Elmer Smith remembers Chuck Stone, the legendary journalist from Philadelphia who was known as a thorn in the side of police and an advocate for the little guy
updated 2:56 PM EDT, Sun April 13, 2014
Al Franken says Comcast, the nation's largest cable provider, wants to acquire Time Warner Cable, the nation's second-largest cable provider. Should we be concerned?
updated 11:22 AM EDT, Fri April 11, 2014
Philip Cook and Kristin Goss says the Pennsylvania stabbing attack, which caused grave injury -- but not death, carries a lesson on guns for policymakers
updated 3:06 PM EDT, Fri April 11, 2014
Wikipedia lists 105 football movies, but all too many of them are forgettable, writes Mike Downey
updated 10:32 AM EDT, Fri April 11, 2014
John Sutter and hundreds of iReporters set out to run marathons after the bombings -- and learned a lot about the culture of running
updated 12:49 PM EDT, Fri April 11, 2014
Timothy Stanley says it was cowardly to withdraw the offer of an honorary degree to Ayaan Hirsi Ali. The university should have done its homework on her narrow views and not made the offer
updated 10:16 AM EDT, Fri April 11, 2014
Al Awlaki
Almost three years after his death in a 2011 CIA drone strike in Yemen, Anwar al-Awlaki continues to inspire violent jihadist extremists in the U.S, writes Peter Bergen
updated 9:21 PM EDT, Fri April 11, 2014
David Bianculli says Colbert is a smart, funny interviewer, but ditching his blowhard persona to take over the mainstream late-night role may cost him fans
updated 1:31 PM EDT, Thu April 10, 2014
Rep. Paul Ryan says the Republican budget places its trust in the people, not in Washington
updated 5:28 PM EDT, Thu April 10, 2014
Aaron David Miller says Obama isn't to blame for Kerry's lack of progress in resolving Mideast talks
updated 11:22 AM EDT, Mon April 14, 2014
David Weinberger says beyond focusing on the horrors of the attack a year ago, it's worth remembering the lessons it taught about strength, the dangers of idle speculation and Boston's solidarity
updated 12:32 PM EDT, Thu April 10, 2014
Katherine Newman says the motive for the school stabbing attack in Pennsylvania is not yet known, but research on such rampages turns up similarities in suspects and circumstances
updated 7:03 AM EDT, Fri April 11, 2014
Simon Tisdall: Has John Kerry's recent track record left Russia's wily leader ever more convinced of U.S. weakness?
updated 12:40 PM EDT, Thu April 10, 2014
Mel Robbins says Nate Scimio deserves credit for acting bravely in a frightening attack and shouldn't be criticized for posting a selfie afterward
updated 2:39 PM EDT, Wed April 9, 2014
Wendy Townsend says the Rattlesnake Roundup -- where thousands of pounds of snakes are killed and tormented -- is barbaric
updated 9:45 AM EDT, Thu April 10, 2014
Dr. Mary Mulcahy says doctors who tell their patients the truth risk getting bad ratings from them
updated 9:28 AM EDT, Wed April 9, 2014
Peggy Drexler says the married Rep. McAllister, caught on video making out with a staffer, won't get a pass from voters who elected him as a Christian conservative with family values
updated 7:43 AM EDT, Wed April 9, 2014
David Frum says the president has failed to react strongly to crises in Iran, Syria, Ukraine and Venezuela, encouraging others to act out
updated 4:57 PM EDT, Wed April 9, 2014
Eric Liu says Paul Ryan gets it very wrong: The U.S.'s problem is not a culture of poverty, it is a culture of wealth that is destroying the American value linking work and reward
updated 7:51 AM EDT, Wed April 9, 2014
Frida Ghitis writes: "We are still seeing the world mostly through men's eyes. We are still hearing it explained to us mostly by men."
updated 10:08 AM EDT, Thu April 10, 2014
Chester Wisniewski says the Heartbleed bug shows how we're all tangled together, relying on each other for Internet security
updated 3:26 PM EDT, Wed April 9, 2014
Danny Cevallos says an Ohio school that suspended a little kid for pointing his finger at another kid and pretending to shoot shows the growth in "zero tolerance" policies at school run amok
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT