Q&A: Greece's 'technocratic' government
- 11 November 2011
- From the section Europe
Greece's leading political parties have joined forces behind an interim unity government tasked with steering the country through its massive debt crisis.
It is being led by former banker Lucas Papademos, the man credited with taking Greece into the eurozone, and the assumption is that it will be technocratic - a government led by experts, not politicians.
Here we look at some of the issues around this initiative to rescue the eurozone's most financially challenged member state.
What was wrong with the previous government?
On paper, the Socialists (Pasok) under George Papandreou were capable of leading Greece on their own, having won the 2009 poll with a majority of nine seats. However, public anger over drastic cuts in public spending finally spread to the party itself, with some MPs in open revolt. Two years into his term, Mr Papandreou found himself unable to govern effectively, while Greece's "troika" of creditors - the European Union, European Central Bank (ECB) and International Monetary Fund (IMF) - threatened to withhold further assistance in the absence of economic reforms.
A proposal by Mr Papandreou to hold a referendum on the troika's follow-up bailout deal shocked eurozone leaders and made his position untenable in the eyes of many. But calling an early election was not an option for many Pasok MPs, fearful of being punished by the voters for cuts that any ruling party would have probably been obliged to make.
Why does the conservative opposition back the new government?
Many commentators have described Mr Papademos's mission as the toughest job in Europe: he is tasked with ensuring Greece gets its latest 8bn-euro (£7bn; $11bn) payment from the troika's initial 110bn bailout, and ratifying a second bailout worth 130bn. The price to pay is further painful reform. It is in the interests of both the conservative opposition party, New Democracy, and Pasok not to take the blame for this pain come the next election, which is not due to be held until after the second bailout is secured. Sources suggest New Democracy leader Antonis Samaras nearly scuppered the coalition talks in anger over an EU demand for a written pledge to honour the terms of the new bailout.
Just how expert is the new cabinet?
As governor of the Bank of Greece, Mr Papademos oversaw the transition from the drachma to the euro in 2002. He later acted as adviser to Mr Papandreou. His cabinet is solidly composed of politicians, not other outside "experts", however. Evangelos Venizelos, for example, has kept his job as finance minister from the Pasok cabinet despite his limited experience of fiscal matters. That said, Stavros Dimas, the new foreign minister, is a familiar figure in Brussels circles as a former EU environment commissioner (2004-09), as well as being deputy leader of New Democracy.
No problem mustering a parliamentary majority now?
Most of the ministers in the new cabinet are from Pasok with two from New Democracy and one from a radical nationalist party, Laos. Between them, the three parties have 253 of the 300 seats in the lower house of parliament. Even without the support of Laos, the two main parties would dwarf the others. Commenting on Twitter about the unusual mix of politicians taking their oath, Greek blogger Nick Malkoutzis remarked that in contrast to past inaugurations in Athens, this was characterised by a "lack of smiles and back-patting". "Realised they have to work with each other," he added. "PM Papademos will have a task to keep some of these guys in check but hopefully three months will be too little time for them to run amok."
How will we know the new government is working?
The immediate test is whether it can get the 8bn payment from the troika by mid-December, when the state's own funds are expected to run out. Among the difficult tasks Mr Papademos faces are selling off state-owned companies and tackling rampant tax evasion. The new cabinet is "not there for major legislative work but to support the new prime minister and create a climate of consensus after months of political tension", Mr Malkoutzi told the BBC News website. Mr Papademos himself, he adds, has three targets: to secure the euro deals, re-establish trust with the eurozone and rebuild people's faith in the political system - "the toughest target of all".
Is this Greek experiment a historic departure?
Technocratic governments are nothing new in the EU. Italy formed several such cabinets in the 1990s to overcome financial crises, and post-communist EU states took a similar approach. Greece itself had an interim government under former Bank of Greece governor Xenophon Zolotas in 1989-90. Supporters of the Papademos government argue that because it has cross-party support in parliament, Mr Papademos will enjoy more legitimacy than his single-party predecessor.
Is everybody comfortable with having an unelected prime minister?
Some anti-austerity protesters already disillusioned with Greece's mainstream political parties, as well as eurozone membership, have talked of a dictatorship imposed by Brussels. "This is a raw subversion of the people's sovereign rule," said Alexis Tsipras, head of the leftist party Syriza. It is an allegation that stings in Greece, with its history of military dictatorship. The key question is how long it will take for the new government to do its job and organise a new election.