Elections were just held in Greece and probably will be held
again in June. Being that I am new to
how the Greece Parliamentary system works, I decided to do some digging. I used some NYT articles (here
and here
and here)
to try and figure out exactly what happened.
My summary is below:
- The two main parties in Greece – New Democracy (center-right) and Socialists – lost seats in Parliamentary elections.
- Syriza (Coalition of Radical Left) and Golden Dawn (far-right) both picked up seats.
- There are now 7 parties in Parliament, which means that a coalition government is going to be very hard to get, and will probably lead to new elections.
- The vote seems to be a clear rejection of the bailout terms; thus, the parties gaining seats are refusing to accept the previous ruling parties negotiated austerity package.
- Polls indicate that with new elections, parties opposed to the bailout will pick up more seats.
- Further, since Syriza has the second most seats now (16% compared with New Democracy – 20%, and Socialists – 14%) any coalition government formed without them could stoke even more civil unrest.
- The EU’s financial support is dependent on those negotiated austerity measures. Without those spending cuts, in the absence of a change in policy, the EU will stop financing Greece.
- If the EU pulls the plug Greece will default and be out of the Euro.
- Note: the EU + international community has pumped in roughly $312B, still debt to GDP is at a peak and the recession worsens.
Next, I will cover what the fallout will be to Greece.
