Now that Greek officials have ruled out any chance to form a new government, a follow-up election has been announced. However, this time it appears that voters are now ready to roll the dice and cast their lot with a fervent left-wing coalition running on a campaign to pressure Eurozone authorities for greater leniency in the country’s existing austerity commitments.
The most recent polls suggest that the SYRIZA party – an acronym that translates to “Coalition of the Radical Left†– will improve on its second place finish in the recent election and could lead all other parties with nearly 30 percent of the vote. The SYRIZA leader, Alexis Tsipras, ran in the last election on a platform that would keep Greece part of the Eurozone, while rejecting outright the austerity requirements mandated as part of Greece’s continued financial support and Eurozone membership.
The idea that Greece could not only remain part of the Eurozone but also continue to receive funding all the while willfully refusing to implement its agreed upon spending cuts defies all logic. What’s more surprising, is that with the SYRIZA leading the polls, it appears many Greek voters believe Tsipras could actually pull this off.
Greece is Running Out of Time
On Tuesday, German Chancellor Angela Merkel sought to regain control of the message stating that Greece must either abide by its earlier agreements, or exit the region and return to the drachma. Merkel went on to say that the uncertainty of the situation was damaging to the entire Eurozone and “solidarity for the euro†was at risk so long as the crisis was allowed to fester.
For his part, Tsipras, apparently remains convinced he can have it both ways and while officials continue to favor brinksmanship over policy, Greece stumbles inexorably towards a deadline that cannot be altered. Greece is running out of money with only an estimated 2 billion euros remaining in the kitty. At best, this will keep the country afloat until late July or early August at the latest.
The agreement signed last year calls for another 30 billion euros in support for Greece but this is contingent upon Greece imposing another 11 billion euros in spending cuts. Access to this money is imperative if Greece is to avoid defaulting on its next round of debt repayment.
Between now and the point at which Greece runs out of money, one side will be forced to blink if Greece is to remain within the Eurozone. By voting in Tsipras and the SYRIZA, Greek voters are betting that it will be the Eurozone leaders that find they do not have the stomach for the unknown surrounding a Eurozone sovereign default.
