Greek Government Formed Today, Will Soon Crumble

European credit crisis watchers cheered the end of the nerve-wracking Greek electoral cycle, with a coalition government sworn in that does not seek further debt repudiation or a sudden break with the Euro, its European creditors, and the European Central Bank

A look at electoral results, however, suggests this government may be set to fail very quickly.   As a well-connected Greek businessman pointed out to me last night,[1] voter apathy indicates huge dissatisfaction with the choices of leadership in Greece.

The big winners were the absentees.[2]  If you look at the results you have 39% did not vote.  Which, for the US, is nothing alarming but in Greece we usually have absentees under 5%.  It’s a real conclusion that people have lost all confidence in politics and politicians.

He then explained that the peculiar Greek parliamentary system means the leading coalition can form a government with only a fraction of eligible voters in support.

You have about a third of the people who voted for the Conservative party and they’re going to form the coalition government.  Which is a joke!  Because of the way the electoral system works, the first party gets a bonus of 50 seats in the parliament.  So you have a government that now has a majority with less than 40% of the votes which represents 24% of the voters…Now that’s not really a democracy.

It’s also an indicator of a weak coalition position.  On top of that, fully a third of the electorate that did vote for the left-wing candidate will seek only to obstruct the new government.

Here’s the people who will do everything they can to block everything.  They’d rather die and create a mess than accept reality.

This is not a hopeful situation when what Greece needs, and what Europe needs, is unprecedentedly strong leadership.  Given the hard choices ahead, it’s unlikely the coalition government can hold power for the next year.[3]

[1] Audio interview to follow as soon as possible

[2] Meaning, abstention from voting

[3] My prediction, not my friend’s prediction.

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