Most everyone who watched the recent parliamentary debate at the level of party leaders came away with the impression that the country has entered a protracted electoral period.
Prime Minister Alexis Tsipras’ speech laid out what will essentially be his electoral platform. In his view, the government succeeded where its predecessors did not, as he was able to manage a major economic crisis in a suffocating economic and political environment.
He will argue that he fulfiled the obligations to creditors that he undertook three years ago, having passed a strict cycle of evaluations, thus creating the conditions for an exit from the memorandum and for a debt relief package, allowing Greece’s autonomous re-incorporation in the international economic system.
He prides himself over the fact that the once excluded and marginalised Left has become a ruling power that is able to handle critical affairs, and that it succeeded despite attacks from establishmentarian political forces, big interests, and a broad circle of neo-liberal opponents. In this, his only ally was the people, he will argue, and especially the poorer classes, with which he consciously allied in order to take the country out of a great impasse.
Mr. Tsipras says he will move forward with the poorer classes, which he basically feels he represents, and he will attempt to satisfy them through Finance Minister Euclid Tsakalotos’ policies of active demand. Tsakalotos view is that you need not expand the pie to offer handouts to the poor, and that by distributing the surplus you can achieve the growth that the country needs.
Right now, what is paramount is closing the fourth bailout evaluation, exiting the bailout in August, and gradually regaining some measure of freedom in implementing fiscal policies.
One can expect that an election scenario before September, therefore, can be ruled out.
Tsakalotos told parliament that the 2019 budget will provide for various handouts, given the expected primary surplus of over 3.5 percent of GDP.
The technical agreement with creditors includes measures to counterbalance such unpopular measures as pension cuts. Despite political or ideological differences, the creditors believe that Tsipras is getting their job done, so they will check him, but not hang him out to dry, as they did with ex-PM Antonis Samaras in 2014.
The government wants the 2019 budget to include a 13th annual pension to counterbalance cuts, and rent subsidies to a mass of poorer renters. There will also be an effort to provide an ENFIA real estate tax discount for lower income brackets. Moreover, with the new ratio of one civil service hiring per one departure, the government will be able to appoint a substantial number of voters to the civil service.
Tsipras advisors think the above measures will cover a substantial segment of society.
That is where the so-called Turkey scenario, which has Tsipras calling snap elections in January after the Christmas turkey has been consumed, comes in.
Having distributed all the handouts, he will seek an intense political cash with opposition leader Kyriakos Mitsotakis during the parliamentary debate on the budget, and he may leave open the prospect of accepting Mitsotakis’ demand for elections.
Under that scenario, the PM would call snap elections in early January, to be held at the end of the month, around the four-year anniversary of his first electoral victory.