Austerity-battered Greeks favour radical left before vote

ATHENS — The winds of political change are coursing through austerity-weary Greece, but a financial whirlwind may lurk round the corner.

Opinion polls ahead of Sunday's closely-watched national election agree: The radical left opposition Syriza Party, which has vowed to rewrite the terms of Greece's international bailout, is poised to defeat Prime Minister Antonis Samaras' conservatives. To govern — in a historic first for the Greek left — it may need the backing of a smaller Party, but most seem willing to oblige.

"I want this government to go. It has disappointed me," said Babis Limnaios, 41, an Athens electrician who last voted in 2004 for the conservatives but will now back Syriza. "I want them to change everything — tax, health care, education."

Communist-rooted Syriza has alarmed markets and investors with its talk of massive debt forgiveness and riding roughshod over the bailout deals. But the mood is less fraught than in the last national election in 2012, when many saw a Syriza victory as a precursor to a possible Greek exit from the eurozone, the 19 nations that now share the euro currency.

For one, Greece's European partners are less exposed to fallout from a Greek financial collapse. The eurozone has a bailout fund and the European Central Bank (ECB) has committed to buy the bonds of troubled countries, if needed. And despite erratic bombshells from some Syrizan officials — one candidate suggested printing euros if push comes to shove — the party is straining to play up its mainstream, Eurocentric aspects.

Still, Greece's next government faces an enormous to-do list. It must consolidate reforms, keep running balanced budgets, strengthen weak growth after a six-year recession, conclude frozen talks with bailout inspectors to secure a 7.2-billion-euro ($8.1 billion) loan tranche and negotiate further relief for its bloated, 320-billion-euro ($359 billion) debt.

Creditors insist Athens must honour its bailout commitments if it is to receive continued support. If things go wrong, Greece could again face default — despite its 240-billion-euro ($269 billion) bailout and years of belt-tightening — and find its eurozone membership untenable.

Samaras, whose New Democracy party governed since May 2012 in a coalition with its Socialist former archrivals, has promised some tax relief, saying economic growth and investment will gradually reduce unemployment. He was forced to call Sunday's vote to end an impasse over the election of Greece's new president.

Syriza's 40-year-old leader, Alexis Tsipras — a former Communist youth member — favors a radical approach: Writing off most of Greece's debt, a burden he describes as "not just unbearable, it objectively cannot be repaid".

Tsipras voiced confidence Friday that he can strike a "viable, mutually acceptable and beneficial" deal with creditors by the end of June, after which Greece will need to pay maturing bonds worth more than 10 billion euros that are held by the ECB.

Syriza wants to ditch primary surplus targets, while still pursuing a balance between non-debt-related spending and revenues. It proposes to restore the minimum monthly salary from 586 to 751 euros ($657 to $842), provide free power and food coupons to 300,000 households, raise the tax-free income threshold from 5,000 to 12,000 euros ($13,500), reverse public sector firings and liberalise labour laws.

Greece's electoral system gives a 50-seat boost to the first party, making it effectively impossible for the runner-up to form a coalition if the winner fails.

In a deeply polarised campaign, the conservatives have demonised Syriza, stoking middle class fears of bankruptcy and a return to the old drachma currency.

"The only thing they haven't said so far is that, if Syriza wins, it will round up your children and seize your women," Tsipras joked.

But the invective doesn't seem to be working.

Opinion polls published on the last day of campaigning showed Syriza increasing its lead, with five surveys giving Tsipras an advantage of between 5.2 and 6.7 percentage points — a gain of about 2 points in a week.

In the name of national salvation, Greeks have suffered five years of gruesomely high unemployment, during which the economy shrank by a quarter and average incomes by a third. Jobs, where available, are mostly underpaid or part-time, offering no social security or prospects for advancement. Health care services have deteriorated, pensions have been slashed, and most apartment blocks lack central heating because so many residents can't pay.

Meanwhile, the average tax burden has multiplied.

The final straw was last year's decision to make permanent a hated new property tax. That hurts, because for decades ordinary Greeks had invested in real estate. Since 2009, however, market prices — but not taxable values — have dropped 40 per cent and rents have shrunk.

Cinema production electrician Gerasimos Soulis said he would vote for Syriza but without great conviction in its ability to enact change.

"Jobs have opened, but they're not jobs. It's like you're making pocket money," he said. "We are trying with a third of the money to do what we used to do. And we're happy that we now have a third, because they made us grow accustomed to having nothing."

What remains doubtful is whether Syriza will secure the minimum 151 seats in Greece's 300-member parliament that it needs to govern alone. If not, it must look for a partner from a smaller party.

Tsipras said Friday that he is "one step" away from an absolute majority, which would spare him an alliance with "the forces of yesterday, which have every reason to want to trip Syriza up after the election". But he indicated that he would compromise, if needed, to avoid a second election a month later.

With the politically untouchable, Nazi-inspired Golden Dawn Party, whose leadership is in jail awaiting trial for running a criminal organisation, and the Communist Party — which refuses to cooperate with anyone — out of the picture, possible partners include the new, centrist but untried Potami (River) Party or the once-formidable PASOK Socialists.

Friday's polls suggested Golden Dawn has made late gains and is challenging Potami for third place.

A third option for Syriza could be governing with the populist right-wing Independent Greeks, who agree with Syriza on need to end the austerity but disagree on about everything else.