How will elections affect Greece’s relationship with the rest of Europe?

Greece is headed for its fifth general election in the last six years. After convincingly winning an election in January on an anti-austerity platform and securing a triumphant win for No in the referendum on a bailout deal in July, Greek Prime Minister Alexis Tsipras is now ready to deploy his formidable electioneering skills in the service of the harshest and most far-reaching austerity programme Greece has ever agreed upon.

The reason for calling this election is fairly straightforward: After the agreement between Greece and its creditors on 12 July, Tsipras has been leading a government and a party completely at odds with its ideological identity and electoral pledges.

His decision to reach an agreement that keeps Greece in the eurozone at the cost of more austerity caused a rift with the left wing of Syriza. This created the paradoxical situation whereby austerity measures were being passed in the Greek parliament with the support of the much maligned pro-European opposition, while the Syriza-left was staying part of the Syriza parliamentary group but was voting against them.

Tsipras is now hoping to legitimize his pro-austerity turn with a new popular mandate. Should Syriza win an absolute majority of seats, Tsipras can claim that the Greek people have effectively approved his decision to agree with the eurozone on a new bailout. He will then have a mandate to implement the terms of the bailout leading to a more coherent government.

Should Syriza fail to win an absolute majority, Tsipras will be forced to look for a coalition partner. He might try again with his current coalition partner, the Independent Greeks, but if they fail to clear the three per cent threshold to enter parliament, he would have to turn to one or more of the pro-European centrist parties (PASOK, To Potami, perhaps even New Democracy).

Tsipras’ rhetoric has been very antagonistic towards these parties, but again, he can claim that it is the people’s mandate that calls for the formation of a coalition government. In both scenarios, Tsipras is looking for one final popular legitimation of his shedding of the last traces of his vehemently anti-austerity identity.

Closed-list system

The timing of the elections is not coincidental. Tsipras is trying to have the elections staged as quickly as possible, so as to allow as little time as possible for the Syriza-left to organize as a new independent party. At the same time, as the elections take place less than a year after the January elections, constitutionally they must take place under a closed-list system. Normally in Greece, parties run open lists of candidates in multi-member constituencies.

These candidates campaign individually to gain preference votes from the voters of their party lists. With a closed-list system, party leaders draw up lists where each candidate’s place is predetermined and voters only vote for parties but no candidates. This gives substantial leeway to party leaders to control who forms their party’s next parliamentary group. Tsipras will certainly lead a Syriza party that will be completely under his control in the next parliament.

Syriza will certainly come first, but it is difficult to say what its final tally will be. It will almost certainly lose votes to its left (the new anti-austerity breakaway, the communist KKE, and other smaller radical parties); but it will also gain votes on the center from voters who see in Tsipras the only viable force of stability at this juncture.

This in turn will further pressure smaller center-left parties like PASOK and To Potami. PASOK in particular may face a difficult battle to even make it in parliament at all, having just elected a new rather uninspiring leader. Tsipras’ current coalition partner, the Independent Greeks, will also face losses. New Democracy currently has an interim leader and is almost completely directionless.

The only certain winners will probably be the Neo-Nazi party of Golden Dawn, buoyed both by Tsipras’ ‘treason’ and by the severe immigration pressures Greece faces. The danger is that this election will produce no winners beyond Golden Dawn, and this will make the formation of a new government afterwards all the more difficult.

Europe’s reaction

Tsipras’ decision to call elections is bad news for the Greek economy and Greece’s relationship with its European partners. Leaders in countries such as Germany, Finland and Slovakia had a very hard time convincing their parliaments and their electorates that more assistance had to be given to Greece. Now Greece is entering a new period of uncertainty, which may extend well after the September election.

Greece’s creditors will still expect reforms and austerity measures to be implemented in the meantime, and will not accept political instability as an excuse. Voters and taxpayers in other Eurozone countries will have a hard time understanding why the Greek political system yet again failed to reach consensus and avert more uncertainty that affects the economic outlook of the whole eurozone.

For the Greek economy, the announcement of these elections is the final blow in a catastrophic 2015. With its banking system all but collapsed, the image of its tourism partially blemished by the migrant emergency in the Aegean, and its reputation among investors in tatters, Greece is now back to stagnation, if not outright recession.

Overnight the leader of Syriza’s left wing announced the creation of a new anti-austerity party with the name ‘Popular Unity’. As an indication of how deep the rifts in Syriza’s current parliamentary group are, 25 MPs announced their support for the new party, which is now the third biggest force in the Greek Parliament.

The performance of Popular Unity remains a major question, as this party has never run independently before. The number of MPs who support them currently corresponds to roughly 10 per cent of the popular vote, but it should very difficult for them to actually score that much in an election.

Chances are they will clear the three per cent threshold and enter parliament, after which they’ll hope they can slowly eat support away from Syriza, much as Tsipras did from the then dominant PASOK after 2010.

This article is published in collaboration with Chatham House. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Dr Angelos Chryssogelos is an Academy Senior Fellow of the Europe Programme.