France: As expected, Francois Hollande is the new president of France. In his victory speech on 6 May, Hollande said “…austerity cannot be the only option.”
Greece: As expected, no party won a majority. The conservative New Democracy Party obtained the most votes, followed by a coalition of leftist parties and then the Socialists. Nevertheless, the New Democracy and Socialist Parties both sustained an enormous reduction in popular support. The magnitude of the anti-austerity vote was described as a volcanic eruption by Greek political analysts.
On 7 May the New Democracy Party failed in its attempt to form a coalition government. The second place party, the Coalition of the Radical Left rejected the New Democracy’s offer. The leader of the Coalition, AlexisTsipras, said the parties that make up his coalition are in opposition and demand that the austerity measure be canceled.
The Greek President has asked the Coalition of the Radical Left to form a government. If it fails, the Socialists will be asked. coalition with the conservative New Democracy (ND) party, AP reported May 7. After talks with ND leader Antonis Samaras, Alexis Tsipras said the parties are in opposition and demanded that austerity measures be canceled.
Comment: The popular mood is dark. A neo-Nazi party won 7% of the vote which will entitle it to have representation in parliament for the first time. Expect street disorders.
German reaction also is as expected. Germany will not work to change Europe’s compact on budget discipline and rejects growth measures that increase debt levels, government spokesman Steffen Seibert said on 7 May.
New negotiations of the fiscal compact are not possible, Seibert said, adding that growth should come through structural reforms, not through new debt. Greece must implement reforms it agreed to as part of its bailout package. The agreements represent Greece’s best path forward and Athens must adhere to them, Seibert said.
Die Welt’s editorial wrote,
“Both Hollande and the Greek opposition are serving people’s desire for a fundamental change in political and social conditions, which are mainly attributed to the most powerful woman in Europe: Chancellor Angela Merkel.”
“They were voting against a tight rein on states by a central authority in Brussels, against the loss of democracy through ‘expert government’. These elections were a clear rejection of the Angela Merkel’s system in Europe.”
Comment: Teutonic sternness is more likely to be incendiary than helpful. Die Welt has the right of it. The eurozone experiment is proving unsustainable against the sentiment for utopian and egalitarian solutions. The economies do not mesh. The regime of the bankers and bureaucrats in Brussels is under threat.