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Greece: A New EraSusannah Verney a ba Lecturer in Greek Politics , Beaver College ,Athensb Teaches at the University of AthensPublished online: 09 Nov 2007.

To cite this article: Susannah Verney (1997) Greece: A New Era, MediterraneanPolitics, 2:1, 193-200, DOI: 10.1080/13629399708414612

To link to this article: http://dx.doi.org/10.1080/13629399708414612

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Greece: A New Era

SUSANNAH VERNEY

PASOK's victory in the election of 22 September 1996 was widely hailed inwestern Europe as the dawn of a new era for Greece. Headlines like theFrankfurter Allgemeine Zeitung's 'Greece, Welcome to the European Club',expressed a widespread feeling that the European Union's mosttroublesome member was about to be truly integrated at last. The populistnationalism which had made Greece seem so Balkan was presumed to havebeen buried along with its chief exponent, Andreas Papandreou. Hissuccessor as prime minister and as president of PASOK, Kostas Simitis, wasseen as the 'European' leader who would take his country into the twenty-first century, implementing a tough economic policy which would allowGreece to keep a belated appointment with European economic andmonetary union, and bringing the country's foreign policy more into linewith that of its partners.

Simitis' victory was only one aspect of the extensive renewal of theGreek political leadership which has taken place in the space of just a fewyears. Papandreou's death in June 1996 followed one year after theretirement of President Karamanlis. The third of the 'dinosaurs' who haddominated political life since the 1960s, Konstantinos Mitsotakis, while stillpolitically active, had lost the leadership of New Democracy in 1993.Meanwhile, Charilaos Florakis, Communist Party secretary-general since1973, had already been succeeded in 1991 by Greece's first woman partyleader, Aleka Paparriga. The 'New Left' Synaspismos was also led brieflyby a woman, ex-communist cadre Maria Damanaki, before she was replacedin 1993 by lawyer Nikos Konstandopoulos, who had never been part of thetraditional Left.

With the emergence of this new generation of leaders, there was a strongfeeling that the chapter of Greek history which had opened with the fall of thedictatorship in 1974 had finally come to a close. Of course, this prospect hadbeen under intermittent discussion in the Greek media ever since the late1980s, when the temporary relaxation of Papandreou's grip on powerfollowing his open heart surgery resulted in the revelation of political scandals

Susannah Vemey is a lecturer in Greek Politics at Beaver College, Athens, and also teaches at theUniversity ofAthens.

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which triggered a crisis in his party, his government and the political system.At that time, hopes had been aroused that, with the resolution of the crisis, anew modernizing ethic would sweep away old clientelistic structures andpractices, ending the over-intimate relationship between the governing partyand the state, and possibly reformulating the party system.

These expectations were not fulfilled. The coalition governments of1989-90 played a positive role by effecting a historic reconciliation, firstly,between the victors and vanquished of the 1940s civil war and, secondly,between some of the leading players in the mid-1960s democratic crisis.This allowed political debate to move beyond the fratricidal disputes of thepast and begin to engage with the problems of the 1990s, with most analystsnow emphasizing a struggle between 'populists' and 'modernizers' whichcut across party lines. However, the katharsis process of cleaning up publiclife failed to reform the institutions, degenerating instead into a series ofbadly-prepared show trials of former PASOK ministers, most of whichended in acquittals for lack of evidence.

In retrospect, it would appear that once again, Greek political life wasfollowing a pattern of seven-year cycles: the military dictatorship of1967-74 had been succeeded in turn by the first period of New Democracygovernment (1974-81) and the phase of PASOK's ascendancy (1981-88).Then Papandreou's first health crisis in the summer of 1988 inaugurated anew cycle, which reached its final phase with his emergency admission tohospital in November 1995. This was a period of multi-faceted crisis,spanning economics, foreign policy and domestic politics.

The Greek economy, a 1960s' success story with growth rates twice theOECD average, never recovered from the oil price shocks of the 1970s.Accession to the then EC only highlighted its structural weaknesses. Unableto compete in the European market, industry's share in GDP began to decline,damaging Greece's already weak industrial base. Post-democracy rises inwages and social welfare spending, reaching new heights under the socialistadministration in the early 1980s, stimulated an inflationary spiral and over-stretched the budget. In 1989, Greece finally faced economic reality.

For most Greeks, the 1980s had been 'feel good' years, when theyenjoyed a considerable rise in their standard of living. But over the decade,GDP growth dropped to almost half the EC average. By 1990, Greece wasapparently the poorest Community member, with an official GDP per capitabelow that of Portugal (although the figures were recently revised upwardsin an attempt to prove convergence with the Maastricht criteria).Meanwhile, the public sector debt jumped from around 40 per cent at thebeginning of the decade to around 110 per cent by the end. Unfortunately,Greece's moment of economic truth coincided with the launching of theEC's plan for EMU, finally institutionalizing the prospect of a two-speed

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Community. When the criteria for adoption of the single currency wereadopted at Maastricht in 1991, it was clear that Greece had little chance ofqualifying: on three of the indicators (inflation, budget deficit and interestrates), its record was the worst in the Community. Its economic weaknessthus looked likely to lead to Greece's marginalization within the EU.

Greece had been living with external insecurity since at least 1974, whenTurkey invaded Cyprus and raised a series of Aegean frontier issues. Butwith the end of the cold war, Greek threat perception grew rapidly. TheYugoslav explosion in its backyard emphasized that Greece was once againin a political earthquake zone of unstable borders and competing territorialclaims. Crowning the series of re-emerging friction points with the Balkanneighbours was the establishment of the Former Yugoslav Republic ofMacedonia (FYROM) as an independent state. Although apparentlyirrational to most outsiders, the majority of Greeks, remembering theannexation of Greek Macedonia during both world wars, feared that theirterritorial integrity was threatened by the symbolic irredentism integral totheir new neighbour's nation-building process and enshrined in itsconstitution. Meanwhile, Greek-Turkish tension was increasing. Accordingto figures released by the Greek Ministry of Foreign Affairs, the first half ofthe 1990s saw Turkish violations of Greek airspace almost triple, from 240in 1991 to almost 700 in 1994 (Eleftherotypia, 6 Feb. 1997).

Greek insecurity was aggravated by the reluctance of the country's alliesto take a clear stand in support of its territorial integrity. The 1990-91 inter-governmental conference saw the rejection of Greek proposals that the EC'sCommon Foreign and Security Policy should include a mutual solidarityclause and a commitment to the defence of EC borders. Subsequently, in theJune 1992 Petersburg Declaration, the West European Union declared thatits mutual defence clause should not be invoked in a dispute between twomember states. This was interpreted in Greece as damaging nationalsecurity, by underlining its partners' unwillingness to provide support in thecase of a Turkish attack.

Meanwhile, domestically this was a period of political instability, withPASOK's decline and fall in 1988-89 followed by the two short-livedcoalitions (lasting approximately four months each), then by a NewDemocracy government (1990-93) whose internecine quarrels wereintensified by its parliamentary majority of one, and finally by the rather sadspectacle of Andreas Papandreou's last years in power. During these years,both single-party and coalition governments and all the major politicalforces were tried and found wanting. This included the Left, whichsacrificed the ideological purity of permanent opposition by participating ingovernment for the first time since the 1940s. Their failures left all theparties deeply divided.

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The Left, whose historic 1968 split between orthodoxy andEurocommunism had been temporarily healed with the formation of theSynaspismos coalition in 1988, suffered a new rift when the CommunistParty divided into orthodox and pro-renewal wings at its thirteenth congressin 1991. The hardliners took over the party and withdrew fromSynaspismos, subsequently refusing even to meet the latter's leaders.

The New Democracy government was riven by internal feuds, with themost serious, between prime minister Mitsotakis and foreign ministerSamaras, preventing any resolution of the FYROM question. In June 1993,Samaras formed a breakaway party, Political Spring, and three months laterbrought down the government. Following his electoral defeat, Mitsotakiswas replaced as party leader by his major rival, the former mayor of Athens,Miltiades Evert. As honorary party president, Mitsotakis in turn worked toundermine his successor.

Evert, in his mid-fifties a member of a younger political generation andpopularly known as 'the Bulldozer', was expected to inspire the party witha new dynamism. He signally failed to do so. Notorious for his mishandlingof the Greek language, he became known for memorably vacuouspronouncements, such as the declaration that ND would form a'government of helicopters', with all its ministers compelled to visit theremote Greek islands every few weeks. The new leader rapidly alienated anumber of leading cadres, driving some such as ex-foreign minister,Michalis Papakonstantinou to break with the party. Evert's populist strategycaused ideological confusion, raising questions about the party's economicphilosophy as ND distanced itself from the neo-liberalism of the Mitsotakisera and reverted to the ill-defined 'radical liberalism' of the 1970s.

In 1995 PASOK, too, suffered a split when former finance minister,Dimitris Tsovolas formed the Democratic Social Movement (DIKKI), witha radical populist programme reminiscent of PASOK's 1970s heyday. Moregenerally, it seemed unlikely that PASOK could stay united, as the approachof the post-Papandreou era stimulated a power struggle between variousfactions and heirs-apparent, often interpreted as a contest between'populists' and 'modernizers'. After the 1993 election victory, it soonbecame clear that Papandreou was too weak to shoulder the responsibilitiesof office. Because the 1986 constitution concentrated power in the person ofthe Prime Minister, the result was the growing ascendancy of a small cliqueof 'president's men', around Papandreou's wife, Dimitra, who as director ofthe prime minister's personal office rapidly became the sole channel ofcommunication with him. Dimitra's role became increasingly controversial- less for the salacious photographs of her pre-Papandreou past regularlypublished in the tabloids or the public displays of religious devotion intowhich she led the ailing socialist leader, than for the increasingly insistent

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rumours that she was preparing to become Papandreou's political heir. Theparty seemed on the brink of open crisis when Papandreou was rushed tohospital.

Then came the nadir, when for two months the government remainedleaderless. Greek political life revolved around the latest medical bulletinsand the intrigues around the sick leader's bedside, until PASOK's leadershipfinally dared to seek Papandreou's resignation. On 18 January 1996, theparty's parliamentary group chose Simitis as prime minister in a contest thatindicated that its MPs were almost equally divided between the supportersof the 'modernizer' Simitis and the 'populists' interior ministerTzochatzopoulos and defence minister Arsenis. Six months of intra-partyintrigues followed before the party congress in June where in a deeplyemotional atmosphere only one week after Papandreou's death, Simitisagain defeated Tzochatzopoulos in the election for party president. Simitisthen completed the hat-trick by calling September's snap elections, won byPASOK with a lead of more than three per cent over New Democracy (41.5per cent to 38.1 per cent) and a majority of 162 out of 300 parliamentaryseats.

The electoral contest was fought largely as a duel between the'modernizer' Simitis and the 'populist' Evert, whose campaign strategiesincluded blaming foreigners for unemployment. Simitis' victory was thuswidely interpreted as a victory for 'modernization', Maastricht andmoderation in foreign policy. Certainly, the new prime minister, who hadnever been implicated in the PASOK scandals, immediately brought adifferent ethos and a simpler style to his role. In a refreshing change fromthe Papandreou and Mitsotakis dynasties, he also made clear hisdetermination to keep his family out of politics. However, despite the newprime minister's declarations to the contrary, in practice the governmentcontinued to function on a clientelistic basis. Simitis' approach towardscontacts with the media, usually limited to reading out prepared statementsand refusing to answer any questions, also disappointed hopes of greaterdemocratic dialogue. Meanwhile, the serious nature of Greece's problemssuggested it would be hard to inaugurate a new era.

In terms of opposition to the government's programme, the rhetoricaldifferences between PASOK and ND no longer concealed a basic consensusabout where Greece should be going. The strategies of both parties revolvedaround meeting the Maastricht criteria and consolidating Greece's place inEurope. However, following its second consecutive election defeat and withonly one independent term in office since 1981, New Democracy went intoopen crisis. Evert's dramatic election-night resignation was followed by hisre-election as party president just twelve days later, before his opponentshad time to organize. The leadership issue thus remained unresolved, and a

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new election was scheduled to take place at the party congress in March1997. Prior to the congress, it was unclear whether the party, split for yearsbetween the Mitsotakis and Evert camps, would be able to stay unified and,even less, whether ND had any chance of developing as a serious alternativeto PASOK. The Greek Right's failure to modernize or even itsfragmentation, leaving PASOK in a hegemonic position, would clearly notbe healthy for Greek democracy.

The three small parties to PASOK's Left, the Communist Party,Synaspismos and DIKKI, emerged from the elections with 15 per cent of thevote and 30 parliamentary seats between them, indicating there was likelyto be a vocal left-wing opposition to the government's economic austeritypolicy. Political Spring's failure to reach the three per cent thresholdsuggested public fatigue over the FYROM question, the central issue withwhich the party was identified. This did not necessarily imply less populistpressure on foreign policy, given that DIKKI seemed to have inheritedmuch of the nationalist protest vote. The greatest source of opposition,however, seemed less likely to come from its opponents than from withinthe governing party itself. There was a clear division between adherents ofthe 'new PASOK', whose 'Europeanizing' programme appeared to haveusurped much of New Democracy's traditional platform, and those whohankered after the more radical past.

In the early months after the elections, the internal party opposition didnot seem to have a major influence on economic policy. By involving theparty organs in discussing its basic principles — in marked contrast toprevious PASOK practice - Simitis achieved their acquiescence to the tough1997 budget. Naturally, the budget sparked the usual round of labour unrestin the EU's most strike-prone country. Particularly disruptive were theprotests by farmers, who cut the country's main communications arteries byblocking the national highways for several weeks in December 1996.However, an attempt to repeat the blockades two months later fizzled outafter the police deflated the farmers' tractor tyres. Greater public sympathywas aroused by the long-running school-teachers' strike in early 1997.While PASOK was elected with a clear mandate to try to meet theMaastricht criteria, there seemed to be a growing feeling that the costs ofMaastricht were unevenly spread, with the wage-earners bearing the bruntof the burden.

In relation to the macro-economic indicators, by early 1997 there weresigns that the austerity policies pursued by all recent governments werebeginning to pay off. Notably, in January, inflation fell below seven percent, its lowest level for 25 years. A marked contrast to the 17 per cent rateof six years earlier, this was of course still well above the EU average (2.2per cent in November 1996). However, within Greece it was already widely

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accepted that the country would not be among the first entrants to the singlecurrency. Hence, unlike his Italian counterpart, Romano Prodi, whothreatened to resign if Italy was excluded in 1999, Simitis had longer timehorizons to work with. While his government would clearly be deemed afailure if Greece was still unable to adopt the Euro in the early years of thetwenty-first century, in 1997 this target date was still more than oneelectoral term away. Of course, as elsewhere in the EU, the questionremained whether meeting the Maastricht criteria was actually likely tostimulate an economic revival. The prospects seemed particularly bleak inGreece, owing to the structural deficiencies of the economy.

Foreign policy crises are always the joker in the pack of Greek politics,with the ability to destabilize the situation overnight. Simitis' period asprime minister coincided with a new escalation of the Greek-Turkishdispute. During the January 1996 Imia crisis, the two countries came to thebrink of armed conflict, as Turkey launched a new policy of questioningGreek land frontiers to complement its twenty-year challenge to air, sea andcontinental shelf borders. Simitis' new foreign policy style was indicated byhis public expression of thanks to President Clinton for his role in defusingthe crisis - an unthinkable gesture for any previous Greek prime ministersince 1974.

However, subsequent developments, such as the declaration by the thenTurkish prime minister Tansu Ciller that Turkey questioned the sovereigntyof 3,000 Aegean islands, and particularly the deaths of three unarmedcivilians in Cyprus during August and October 1996 - two of themspectacularly filmed and shown repeatedly on television - significantlyraised the emotional temperature in Greece. Foreign policy, always afavourite theme in Greek inter- and intra-party competition, became aprivileged platform for the opposition within PASOK. Leading ministerspublicly contested all attempts to move away from cherished policies of thePapandreou period, such as the unified defence doctrine with Cyprus. Whendeputy foreign minister Rozakis suggested a moratorium on both Greek andTurkish military flights over the Aegean, the outcry from both governmentand opposition resulted in his resignation. Despite the preference formoderation of Simitis himself and his foreign ministry team, by early 1997the Greece-Cyprus-Turkey triangle had entered its most tense phase foryears, in a context shaped by Cyprus' application for accession to the EUand the continued governmental instability in Turkey.

Meanwhile, the record of the first few months did not indicate muchprogress in extracting Greece from the Balkan quagmire. By this point,Greece had long lost the battle over the name of Macedonia. In early 1997,foreign minister Pangalos suggested that Greece should accept acompromise as soon as possible. The predictably shrill response from the

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usual sources inside and outside PASOK resulted in Simitis' announcementa few days later that government policy remained unchanged.

His government also seemed to be storing up trouble in Greek-Albanianrelations by continuing Papandreou's support for Sali Berisha, even thoughmost of the Albanian opposition had united against the president after thefraudulent 1996 elections. Notably, just a few weeks before the Albanianpresidential election scheduled to take place in March 1997, Berisha wasofficially invited to visit Greece in May. This was one area where Greekpolicy had aligned with that of other EU members, such as Germany,without this necessarily being positive for Greece.

It is hard to judge a government's record only a few months after theelections. It is equally hard to make predictions. However, in early 1997 theomens for governmental stability were probably better than for a number ofyears. Simitis' major weakness stemmed from his limited power base withinhis own party. But ultimately the attractions of power seemed likely to keepPASOK united, confounding the analysts who had always predicted thatPapandreou's party would not survive its founder. However, the extent towhich the new government would win its gamble to break with the past,cure Greece's economic malaise and keep the country at the heart ofEuropean integration, while avoiding a foreign policy explosion, wasanother issue.

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