Tuesday, October 27, 2015

Cooperation is better than commotion

Amid the mass of coverage in the media here and abroad, about the only thing clear at the moment is that the interests of the majority of voters in this month’s general election are not being best served with the prospect of either a minority centre-right government or a left-wing alliance of unlikely bedfellows.
Things may become clearer – or even more confused – when the incumbent minority seeks a vote of confidence in parliament in the next few days.
Unfortunately, the inconclusive election results did not spur the leaders of the two main parties to try and reach a reasonable compromise arrangement aimed at giving the majority of voters what they are fervently hoping for: stability and less austerity.
Having endured years of severe austerity, voters object to the on-going heavy burden, but they don’t want to throw away what their resilience has achieved since the bailout of 2011.
Not an easy task for the leaders of the centre-right PaF coalition, with their 38.6% of the vote, or the centre-left Socialists, with their 32.3%, but surely they should be doing their very best to find enough common ground to ensure stability by easing austerity while upholding fiscal obligations and remaining on the cautiously optimistic road to recovery.
Democracy thrives on clashes of ideas, raging disputes and robust disagreements, mindful of what is best for national and international communities, but sometimes equanimity and determined cooperation is the best approach, especially in times of crisis.
After the October 4 election, Pedro Passos Coelho and António Costa, the leaders of Portugal’s two main parties, only managed two face-to-face meetings before giving up on the fundamental wishes of their combined total of 70.9% of voters.
The electorate be damned, the country now has a minority interim government that will struggle to survive months, never mind years, and risks being toppled by an unprecedented left-wing alliance that no one voted for.
The moderate Socialist Party has long denounced the severity of the austerity measures imposed by the ruling coalition, but it is in favour of eurozone membership and abiding by the EU rules.
Only after the unsuccessful election did the Socialist leader shunt towards Portugal’s far left, homeland of Syriza sympathisers and hard-line opponents of Portugal’s membership of the eurozone, the EU and NATO.
Portugal is not Greece. The attraction for Costa was the number of seats secured by the Left Bloc and the Communist Party, which respectively received 10.2% and 8.3% of the electoral vote.
If they and a smaller ‘nature’ party all back the Socialists, the broad left would have a combined total of 122 seats, 15 more than the centre-right coalition in the 230-seat national assembly.
It remains to be seen if such an alliance can set aside traditional ideological differences and appease any rebels within the ranks in order to make it a pragmatic political grouping, if not a formally united power.
It also remains to be seen if a majority of the electorate want such an entity and any shared political programme it can come up with.
Despite all the flapping over the past couple of weeks, Portugal is no stranger to minority or coalition governments. Since the return of democracy in 1974, both of the current main parties have run minority administrations. More to the point, the two main parties governed as a left and right centrist coalition in the 1980s.
Never before, however, have leftist parties ruled in coalition. They may soon unite to cripple the minority centre-right, although that does not mean the far left will agree to join a Socialist-led government.
Meanwhile, a record number of registered voters (40.8%) did not participate in the October 4 election, largely because they are fed up with politics and distrustful of politicians of all parties. Sadly, you can see why.
And so the show goes on. If the convoluted events of the past couple of weeks were not so serious and potentially damaging, you’d think it had something to do with Halloween.    

Pedro Passos Coelho and António Costa

Friday, October 23, 2015

Confusion confronts new government

 Portugal’s head of state has given the green light to Pedro Passos Coelho and his centre-right Forward Portugal (PaF) coalition to follow up on their first term in office and form a new government. But that doesn't mean the inconclusive outcome of the general election is all sorted. Far from it.
President Aníbal Cavaco Silva’s decision to deny an unprecedented left-wing alliance the opportunity to govern has gone down well in Brussels and across conservative Europe, but it has caused a commotion at home.
The October 4 election produced no clear winner and this  presented the largely ceremonial head of state with stark options. Although a former Social Democrat leader himself, Cavaco Silva was required by the constitution to fairly judge which group was best positioned to lead the country.
After consulting with all the political parties and in line with tradition, on Thursday evening the president nominated the group with the most electoral votes. He gave them ten days to present a four-year programme for approval by parliament.
Passos Coelho hopes to be able to count on support from any centre-left Socialists (PS) unhappy about the notion of an alliance with the radical Far Left (BE) and the hard-line Communist parties (PCP).
Should Passos Coelho fail to obtain a parliamentary vote of confidence for his programme for the next four years, the president will then be expected to ask the broad left to try to form a government.
Passos Coelho has told the president of the steps he would take to continue sound pro-European governance by the PaF coalition despite failing to get an absolute majority on October 4.
Catarina Martins, spokesperson for the anti-establishment Left Block, which has much in common with Greece’s Syriza and Spain’s Podemos, has said the BE will have the PCP’s support in tabling a motion rejecting the centre-right confidence vote in parliament in the days ahead.
It is thought the Socialists may close ranks and do the same, although more moderate members of the PS are said to be increasingly uneasy about “the self-defeating and reckless” direction in which their leader may be taking them.
Socialist leader António Costa, whose party came second in the election, decided against striking any deal with the incumbent centre-right, but managed to garnered support from the Left Bloc and the Communists who finished third and fourth in the election.
Because of historic feuding, it seemed improbably before and even immediately after the vote counting that the country could end up with a triple left-wing alliance. But it has become a possibility.
The prospect of a sudden shift from a government that co-operated closely with international lenders, to one with anti-austerity and anti-EU leanings, sparked concern among conservative governments and fiscal markets in the eurozone.
During the immediate post-election period this month, Costa, whose personal position seemed in doubt after the disappointing PS election result, reasoned that the centre-right option would not be viable and would simply “prolong the uncertainty” in the country. He has now criticised the president for creating a “useless political crisis.”
The Left Bloc's Catarina Martins said another centre-right government would be “a waste of time” as it could not expect to serve for long. She has chastised the president for “creating instability” and acting like “a cult leader.”
Jerónimo de Sousa, leader of the Communists, maintained that a majority left-wing government was feasible though it had long been spurned by many Socialists. He criticised Cavaco Silva for his “confrontational stance and disregard for the constitution.”
Paulo Portas, the incumbent deputy prime minister and leader of the rightist CDS-People's Party, said it was “absolutely extraordinary that a political leader fighting for his survival” (Costa) could even consider overriding “the vote of the people,” albeit it a minority vote.
Amid the domestic slanging, EU officials have threatened to take action against Portugal for not presenting its draft 2016 budget by the 15 October deadline. Portugal is still running one of the highest budget deficits in the eurozone.
Thursday’s announcement by President Cavaco Silva did not banish international fears that further weeks of uncertainty could harm Portugal's economic recovery more than a year after it exited the strict terms of its €78bn international bailout.
On the same day as President Cavaco Silva’s new government announcement, Angela Merkel, the German chancellor, expressed hope that Passos Coelho would be successful, but also spoke of her concern that upcoming elections in Spain and Ireland could see a swing to anti-austerity forces.
We face difficult situations in Ireland, Spain and Portugal,” she told a meeting of the centre-right European People’s Party (PPP) in Madrid.
Even if Portugal’s centre-right get a vote of confidence in parliament in the days ahead, the new government will struggle to get through major legislative issues and is likely to have a limited life span.
No further general election can be held before May or June of next year. There will, however, be a presidential election when Cavaco Silva steps down in January. The future president’s first task may be to help clear up a political mess.

President Cavaco Silva with Prime Minister Passos Coelho (above) 
and opposition leader António Costa (below)

Thursday, October 15, 2015

Oh for some help from outer space!

More than two weeks after the general election, Portugal will still be in the awkward position of not knowing who is to form the next government.
How much easier it would have been if a group of extraterrestrials had landed last week. They would have provided a handy solution to the conundrum created by voters on 4th October.
Portugal’s democratic history shows that minority governments can’t operate efficiently and don’t last long. So, having received the most votes but failing to win a majority, the centre-right (PaF) coalition under caretaker prime minister Pedro Passos Coelho could do with some backing from the opposition centre-left Socialists led by António Costa.
Shortly after the election, Costa said it would take “a Martian invasion” to convince him to join an alliance with the centre-right. He stopped short, however, of ruling out supporting a minority government on major legislative issues on which they could find common ground.
Negotiations between Passos Coelho and Costa on how they might compromise have so far got nowhere.
The Socialists may still hold the key to some sort of workable power-sharing arrangement, but they have a dilemma. They are pro-EU and have promised to honour this country’s budget commitments, but they oppose and want to lessen the harshness of the austerity measures imposed by the last government.
Before the election, a coalition between the Socialists and the far left - comprising the Left Bloc and the Communist Party - seemed almost unthinkable because of fundamental policy differences.
Surprise, surprise, it emerged that the centre and far left were seriously considering getting together, if only to keep the centre-right out.
The Socialists, unlike the far left, are opposed to dropping austerity or exiting the eurozone. But if the centre and far left were to marshal their differences, they could muster a majority in parliament.
Opinion polls indicate that most Portuguese do not believe the three left-wing parties could form the country's next government, but it remains a possibility.
Bloomberg Business reported that the election had been a victory for Passos Coelho and had been hailed by pundits as “a triumph for austerity and perseverance over Greek-style upheaval.”
The Financial Times said “Mr Passos Coelho’s re-election cannot be described as a ‘victory for austerity. At most, it reflects a grudging acceptance”.
The American online weekly Policy Digest claimed that, “along with last month’s Greek election, it was two in a row for the European Left.” Portugal’s ruling coalition lost its majority“in spite of a well-financed scare campaign, and a not very subtle effort by the European Union to load the dice” in the election.
Whichever way you look at it, political instability or any lack of fiscal discipline can only make Portugal’s fragile economy all the more vulnerable. Investors are already jittery.
 President Aníbal Cavaco Silva will hold separate meetings with the leaders of the main parties on Tuesday and Wednesday, October 20 and 21. Only then will the president be able to decide who to ask to form the next government.
It’s probably all a bit farcical to the record number of voters who abstained on 4th October because they don’t hold politicians of any party in high regard. Some of the abstainers might welcome a sudden influx of sensible Martians.

Passos Coelho and Costa, unlikely partners

Monday, October 5, 2015

Weary electorate get weak government

As anticipated, there was no outright winner in this election. The centre-right coalition led by Prime Minister Pedro Passos Coelho won the most votes, about 38%, but it lost its majority in parliament and has little prospect of serving a full term.
The centre-left polled just over 32% of the votes, less than expected, which left António Costa with another fight on his hands: to carry on as leader of the opposition Socialist Party amid calls for his resignation.
The anti-austerity Left Bloc (BE) achieved their best result ever with more than 10% of the votes. The Communist Party dipped into fourth position with just over 8%.
The turnout was a record low: 43% of eligible voters stayed away, probably because they don’t like any of the political parties or felt their vote would not make much difference to the way the country is being run.
An outright majority in the 230-seat parliament would have required 44% of the vote. As it was, the coalition have so far come away with just 104 seats - 12 short.
Four seats are still undecided as final results of voters living abroad are awaited. While emigrants have the right to vote, most don’t bother. In 2011, non-voters abroad totalled 83%.
The half a million Portuguese who have left the country since 2011 are expected to add to the overall abstention rate.
"If we stay on the path we’ve been following, we won’t need any more bailouts,"  was one of Passos Coelho’s campaign messages.
Although his victory was a hollow one, at least he has the distinction of being the first prime minister to be re-elected among the five eurozone states that received a bank bailout.
The 2011-2015 coalition government’s austerity programme was hugely unpopular, but it appears to have worked, at least to the liking of Brussels. The coalition’s electioneering strong point was that having exited its bailout program successfully in 2014, Portugal’s economy looks like it is back on its feet, showing some of the best growth rates in the eurozone.
Tough times lie ahead but the economy is expected to grow 1.6 percent in 2015 and 1.8 percent next year, according to the latest forecasts from the European Commission.
The Socialists failed to capitalise on their promise to moderate the government’s austerity measures. António Costa said they would boost households’ disposable income while going along with fiscal discipline and supporting the EU policies so adamantly opposed by the far-left.
So, in essence, the 57% of voters who bothered to turn out have just generated a weaker version of the unpopular government they had before. By a slim margin, voters have decided it's better to stick with the devil they know.