The head of the the second most sucessful party , Syriza , the coalition of the Left , Alexis Tipras has now been given the task of trying to form a government around an anti austerity position, after New Democracy tried but failed. He has made it quite clear that his group will not ”attempt to sneak back in what the Greek people threw out in the election.”
The mathematics are very difficult since the party seat standings are as follows.New Democracy 18.8% of the vote , 58 seats plus 50 given to the party which finishes first. Syriza 16.77 % 52 seats. Pasok 13.18 % 41 seats. Independent Greeks 10.6 % 33 seats. Communist KKE 8.48 % 26 seats. The extreme right wing party Golden Dawn 6.97 % 21 seats. The Democratic left 6.1 % 19 seats.
For Syriza to build a workable coalition Tipras needs to make a deal with the Independent Greeks, the Democratic Left, and individual anti austerity factions within Pasok and New Democracy. This may be very difficult but since the alternative realistically is another election as soon as mid June with no guarantee of better results there is a certain incentive to try and get a deal done . We shall see.
The IMF and the ECB and all the pro-austerity establishment insist there is no alternative to what they have offered but with the victory of Hollande and the shift in public opinion in these recent European elections there clearly is an alternative. Necessity will be the mother of invention and some creative thinking about the way forward will deliver better results. Just for starters Greece and France and whoever else in Europe was agreeable could set up an Infrastructure fund denominated in both euros and special investment credits, a kind of European bancor that could be used in participating countries to spur growth and employment as well special credits for the long term unemployed. Some of Greece’s debt burden could be reduced and interest payments on its debt owed to the ECB frozen at close to zero interest for a period of recovery or possibly transferred to this new fund who would acquire it for a limited period of time. France is the second largest economy in Europe with a GDP of over 2.8 trillion dollars. It is and will be a very significant player with or without Germany.