Hostility toward international financial institutions skyrocketed in Greece after its government agreed to austerity measures in return for economic assistance from the International Monetary Fund and the EU. The intensity of violent protests and strikes has reached unprecedented levels and radical forces appear to be gaining ground. Instability in the financial system and growing political turmoil may exacerbate the situation. This analysis examines the Greek crisis’s potential impact on public morale and party politics using Political Capital’s Demand for Right-Wing Extremism Index.
Key Findings: Most important consequences of the Greek crisis
- The Greek government aims to reduce the budget deficit from 13.6% of GDP to 2.5% by 2014 – a tall order for any administration. The trifecta of the global financial crisis, the IMF loan and the austerity package poses a high risk of “symmetric radicalization” – the weakening of centrist political forces and the strengthening of extremists on both right and left.
- The process has already begun: Both the governing Panhellenic Socialist Movement (PASOK) and the opposition centre-right New Democracy party are losing popularity, while support for the populist, chauvinist, right-wing Popular Orthodox Rally (LAOS) and the Communist Party of Greece (KKE) is surging.
- By contrast, the Coalition of the Radical Left (SYRIZA), Greece’s most radical party and the main supporter of the demonstrations that have rocked Athens, is losing ground. SYRIZA will probably continue to lose support after three people were killed in a petrol-bomb attack on a bank May 5. Still, the government’s failure to weaken radical groups means more violence may follow.
- Dissatisfaction with the centre-left PASOK government may boost right-wing radicalization. Political Capital’s DEREX Index shows that anti-establishment attitudes and xenophobia increased in Greece between 2005 and 2009. This means the extreme right has room to grow.
- It is questionable whether the Greek government’s drastic austerity measures can succeed when people are completely unwilling to tighten their belts. Even workers at the Greek Finance Ministry went on strike over salary cuts. Widespread public outrage will likely hamper the government’s plans.
- While PASOK has managed to pin the blame on its predecessor, the New Democracy party, resentment toward the entire political elite is surging, as is hostility toward international institutions. This will challenge PASOK’s popularity and stability. Since the Greek leadership has been unable to weaken violent radical organizations, attacks may escalate against institutions that symbolize globalisation, such as the march on the U.S. Embassy May 1 or the attack on the bank May 5. The anarchist November 17 movement, dissolved by PASOK Prime Minister Costas Simitis 2003, may revive.
- The Greek crisis will not only have consequences not only for the economy, but for international politics as well:
- Fiscal discipline will become de rigeur in the EU, which will limit governments’ ability to use fiscal stimulus and thereby prolong the post-recession recovery.
- Greek trade unionists’ protests may encourage similar demonstrations in countries such as Portugal and Spain, which have been hit hard by the crisis and may impose austerity measures.
- The bailout package places a huge burden on EU member states and will provide ammunition to critics of integration, casting further doubt on the validity of “European solidarity.”
Big Spenders: Europe’s Top Countries for Deficit and Debt, 2009
From the centre to periphery?
With Greece close to bankruptcy, trust in the centrist parties has crumbled. This gives the political “periphery” a chance to strengthen.
- Support for PASOK plummeted to 30.6% in April from 40.3% in January, according to a survey by the GPO agency. Support for the opposition New Democracy party, which formed the previous government, deteriorated to 21% from 29.3% over the same period, according to the poll.
- The biggest share of disillusioned voters now identify themselves as “undecided,” a group that rose to 25.5% of all voters from 9.7% in the first four months of 2010, according to the GPO poll. A smaller group has switched to the extremist parties: Support for the Communists (KKE) rose to 8.9% from 7% while the ultra-right LAOS party jumped to 6.9% from 5.5% among all voters. The extremists fare better when the base group is limited to committed voters who are sure to turn out: Both the KKE and LAOS saw their support jump 50% in this group, pushing their combined support above 21% (see table below).
The government is doing relatively well in terms of people’s opinion on who is to blame for the economic mess: Some 36.4% of respondents think the previous New Democracy government is responsible, compared to 4.1% who blame the current administration of Prime Minister Geórgios Papandréou. This benevolence may easily prove to be temporary. The continuous austerity measures that Papandréou will impose over the coming years may shake his government’s stability and generate an anti-elite, “everyone’s responsible” attitude. The process is already under way: Some 54.3% of poll respondents said “everybody” is to blame for the turmoil. The crisis will therefore damage PASOK and New Democracy the most.
Explanation: KKE: Greek Communist Part (communist), Sy.Riz.A: Coalition of the Left and Progress (far-left, anti-globalisation), Laos: Popular Orthodox Rally (extreme right, nationalist, xenohobic)
Growing anti-establishment attitudes and prejudice
Radicalisation is hardly a new phenomenon in Greece. It becomes even more conspicuous if we look beyond the party preferences. The percentage of Greeks that are predisposed to right-wing extremism rose to 17% in 2009 from 14.6% in 2005, according to Political Capital’s DEREX Index. This is fairly high for a European country.
The main force behind the expansion of right-wing extremism in Greek society was the growth in prejudicial and xenophobic attitudes. Some 46.5% of respondents expressed such views in the autumn of 2009, compared with 41.5% four years earlier. This puts Greeks in fourth place for prejudice and welfare chauvinism among the 33 countries in the survey; only Latvia, Turkey and Hungary scored higher. A higher percentage of Greeks said they considered immigrants bad for the economy and culture than any other country. Meanwhile, the rate of Greeks who expressed anti-establishment sentiments nearly doubled between 2005 and 2009 (15.7% à 30.5%).
Attitudes toward international organizations
Support for international organizations is traditionally low in Greece. Extremists on both right and left have a “common platform” in their strong antipathy to globalisation and the EU. Both the Communists and SYRIZA identify “neoliberal capitalist globalisation” as their main enemy. LAOS says the distinction between left and right is no longer relevant after the Cold War – the crucial question is the conflict between pro-and anti-globalisation forces. This statement may prove telling: The crisis may cause the split over globalisation to deepen, increasing the conflicts and the controversy between centrists and radicals.
DEREX Index data indicates that 15% of Greeks have an extreme lack of trust in both the European Parliament and the United Nations. Only the Croats, Turks and Ukrainians have a higher percentage of people who hold such views. Greece’s strong anti-globalisation attitudes are underscored by last autumn’s Standard Eurobarometer poll in which 63% of Greeks said they “rather distrusted” the U.N. – a higher percentage than any other EU nation. Some 70% of Greeks have a negative view of the International Monetary Fund’s participation in the bailout package, according to the GPO survey cited above. Greece’s view of the IMF – and by extension, all international organizations – will grow even dimmer as the strictures of the austerity program drag out over time.
|Left-Wing Violence in Greece
“Greece has experienced a remarkable escalation in left-wing violence since December 2008, when a 15-year-old boy was fatally shot by police during rioting in Athens. Bombings, shootings and arson attacks have become increasingly regular occurrences. These riots coincided with a re-emergence of radical left-wing groups. These include the Revolutionary Struggle (Epanastatikos Agonas (EA)) and the Sect of Revolutionaries, which both espouse the use of violence against the state. There is a large body of circumstantial evidence to suggest that they continue to attract both university-educated and working-class people, but in contrast to their forerunners, also seem to be recruiting younger members from the middle classes and wealthier families.”
from Jane’s, “Greek Fire: The revival of Greece's radical left,” January 5, 2010
General Socio-Political Impacts of the Greek Crisis on Europe
- Fiscal prudence will become more important. Since nobody wants to follow Greece’s example, governments will try to force themselves to embrace greater fiscal discipline. This may prolong the amount of time countries spend in recession since governments will be less inclined to use fiscal stimulus.
- Further collapse of the European left and deep ideological crisis. The governments of Greece, Portugal, and Spain – three of Europe’s few remaining left-wing administrations – are faced with widespread discontent and conflicts with trade unions. Now that the “Third Way’s” star has fallen among social democrats, the European left is facing ideological emptiness and as it struggles to find adequate responses to crisis situations.
- Weakening integration. EU member states’ massive bailout package may raise dissatisfaction with European integration. Critics will claim that the main beneficiaries of EU membership are “irresponsible states” that will collapse unless fiscally prudent countries help them. We can already see strong criticism against the bailout package in Germany and even Slovakia, which is battling its own fiscal deficit. The prestige of the euro – the very symbol of the EU’s success – has been tarnished and the benefits of the single currency are being questioned.
- “Protest-potential” may grow in other countries. “Revolutions” are often infectious diseases in international relations. Spanish or Portuguese trade unionists may take heart from Greece’s anti-government demonstrations and use similar methods to protest the austerity measures that their own governments may impose.
Political Capital designed the Demand for Right-Wing Extremism (DEREX) Index using its own theoretical model and data from the European Social Survey, a biannual study that tracks changes in societal attitudes and values in 33 countries. Political Capital’s risk-analysis division developed the model, chose the questions, determined subject groupings and set the criteria. DEREX’s data is culled from people’s responses to 29 questions in the European Social Survey’s database beginning in 2003. These questions are divided into four categories: Prejudice and Welfare Chauvinism; Anti-Establishment Attitudes; Right-Wing Value Orientation; and Fear, Distrust and Pessimism. Each of the four sub-indices has a numerical value that shows the rate of people over the age of 15 whose answers indicate that they belong in that category. A country’s DEREX ranking is determined by the number of people who belong to at least three of the four categories – for example, respondents who express anti-immigrant sentiments, anti-establishment attitudes and right-wing values all at once. Using these criteria, the DEREX Index examines the percentage of people whose extremist views could destabilize a country’s political and economic system – if these views continue to gain credence.
 A country’s DEREX score indicates the percentage of people who belong to at least three of the four categories that constitute “right-wing extremism” in Political Capital’s model – for example, respondents who express anti-immigrant sentiments, anti-establishment attitudes and right-wing values all at once (see table above).
 It is important to note that ESS pollsters collected 75% of the Greek data before the October 2009 elections; the rest was collected afterwards. There were significant differences between people’s responses in the two time periods: In September, 81% of respondents said they were disatisfied with the government’s performance; in November, the rate had dropped to 54%. However, there was no decline in prejudice, including homophobia and anti-immigration attitudes; such sentiments grew throughout 2009. Social tensions resulting from the austerity measures will probably strengthen xenophobia, while trust in government will probably erode.