The election victory won by Greece’s Socialists is not going to change the country’s relationships with anyone — not with Arab countries, the rest of the EU, Turkey, neighboring former Yugoslav republic of Macedonia which it fears may harbor irredentist ambitions, or with the US — even though in George Papandreou, it will have an American as prime minister. Although the son and grandson of past Greek prime ministers, he was born in St Paul, Minnesota, and holds joint Greek and US nationalities. Not that it means anything these days: He will be no more pro-American than President Barack Obama is pro-Kenyan.
There will be no change in foreign policy because there is nothing to change. Greece has maintained good relations with Arab states under successive governments, supports Turkey’s bid to join the EU, has worked to solve the Cyprus problem and for better relations with Macedonia. Most of those policies that Papandreou inherits were in fact forged by him when he was Greek foreign minister between 1999 and 2004. As to pulling Greek troops from Iraq, Greece never had any there; the 135 Greek troops in Afghanistan will stay because they are there under the UN mandate and Papandreou supports UN policy on Afghanistan.
It is inside Greece that the differences will be felt, although how much remains to be seen. Papandreou’s big idea is spend the way out of the recession. His campaign centered on a promise to invest almost $4.5 billion to stimulate the economy, funded by tax increases and a clampdown on tax fraud, in contrast to outgoing Premier Kostas Karamanlis’ proposed austerity cuts. It was this that swung it for Papandreou. The Greeks prefers the soft option rather than the tough medicine — and who can blame them? Trouble is they may end up paying through the nose for the Papandreou plan and still have the Karamanlis plan landed on them. Four and a half billion dollars is not a lot compared to the tens, even hundreds, of billions that governments in so many countries suddenly found to bail out the banks. But Greece is already deep in debt and has borrowed even more this year to fund both that debt and budget overruns. In any event, $4.5 billion is unlikely to cure the problems in an economy where the recession is deepening, not bottoming out as elsewhere.
Many wondered why Karamanlis called a snap election in the first place when it was clear he would lose. He had no choice. After last April’s angry street protests against his economic policies, he knew that without a fresh mandate there would be new, dangerously destabilizing violence. He was between rock and a hard place. No one chooses to commit electoral suicide. If he thought that the economy could be pulled out of recession by a little extra borrowing and some tax hikes, he would have done it; as it was tax increases were part of his program too. The fact that he insisted that there had to be austerity as well and was prepared to be thrown out of office over it suggests he was probably right. He could have taken the easy option. In which case, Papandreou has been handed a poisoned cup.
