This Sunday, June 17, general elections for a second time -- in less than two months -- will be held in Greece. The first one, held six weeks ago, has not been able to produce a coalition government capable of governing a country standing at the gate of abyss. This time there is a greater chance of having a majority emerging that is capable of forming a coalition government, but it is not at all certain that this government would be capable of taking Greece away from the fateful gate.
Indeed, according to Nick Malkoutzis, a columnist from Kathimerini, an English-language daily, the latest surveys show that SYRIZA, the radical leftist party, stands to win 31.5 percent of the vote next week, while New Democracy, the traditional rightist party supporting the Troika's -- European Commission, International Monetary Fund (IMF) and the European Central Bank (ECB) -- stabilization program, sits at 25.5 percent. Estimates forecast 134 seats for SYRIZA, winning the 50 extra seats reserved for the first party in elections, and 20 seats for the resurgent Democratic Left (DIMAR), a moderate leftist party but still opposing the belt-tightening measures. These two parties together can reach the majority in the 300-seat parliament. If the two cannot do so with a few seats lacking, the Greek Communist Party (KKE) can still give a hand to a leftist government.
Till last week SYRIZA had no comprehensive and consistent program capable of constituting an alternative to the Troika's depressive measures from which a majority of Greeks suffer so much. Now it has one. Let's start with the comprehensiveness. According to this program, officially called “The Exit from the Crisis is on the Left,” there will not be “a single citizen without a guaranteed minimum income or unemployment benefits, medical care, social protection, housing and access to all public utilities services.” On the other hand, “price controls and price reductions, a VAT reduction and the abolition of the VAT on basic-need goods” will be instituted. Furthermore, the minimum wage, which was decreased by more than 20 percent by the previous government, will be “immediately reconstituted” and so will be the case for real wages within three years. “Layoffs and the deregulation of labor relations will be systematically opposed.” There are also other very appealing proposals in the political field like “direct democracy” and the “termination of military cooperation with Israel,” but they fall out of our scope here.
So far so good, but what about the resources? In other words, how will these very comprehensive and enthusiastic measures be financed? Here we come to the consistency part. Don't worry! There are also quite meaningful proposals on the menu. As SYRIZA has decided to keep Greece in the eurozone, it suggests putting the debt clock at zero through cancelations in order to avoid the huge interest payments of a public debt reaching two-and-a-half times the Greek gross domestic product (GDP). Nevertheless, “provisions for the protection of social insurance and small savers” are not forgotten. Having said that, obviously getting rid of the debt burden would not be sufficient to finance all the social expenditures mentioned above.
So, the rich will pay. Tax collection mechanisms will be “reorganized and consolidated.” “Fortunes over 1 million euros, large scale revenues and consumption of luxury goods” will be taxed. Corporate tax on profits will be increased to 45 percent and “tax exemptions of the Greek Orthodox Church” will be removed; this I liked the most! The tax increase and measures to fight tax evasion should not be considered as fanciful as you believe. Recently, the director of Greek fiscal controllers, Nikos Lekas, declared to French newspaper Le Monde that he absolutely agrees with Christine Lagarde, the director of the IMF, who had attracted lightning by saying that Greeks have to pay their taxes. Mr. Lekas estimates that tax evasion is equal to 12 to 15 percent of GDP -- 40-45 billion euros -- and to take in half of this sum would be enough to balance the budget.
However, SYRIZA, thinking that more taxation might not produce enough revenue, wants to be on the safe side. Some extra revenues are expected “through efficient absorption of European funds, through claims on the payment of a loan for World War II reparations from Germany and finally via steep reductions in military expenses.” This last proposal I liked the second most. Turkey must cooperate with Greece on this one to make it real. As you can imagine, there are other measures like the nationalization of banks while also stopping their "scandalous recapitalization” as well as taxation of financial transactions, etc. Unfortunately, I don't have enough space to mention all of them.
No doubt we face quite a revolutionary program that is comprehensive and consistent. But is it realistic? I'll let you make up your own mind. Let me add that I would have been so glad if I had witnessed German Chancellor Angela Merkel's reaction when she was informed about SYRIZA's plan for exiting from the crisis.