Greece heads to the polls

A hair's-breadth victory for the right is predicted, but time will tell.

The Greek polls have opened, and will stay open until around 4pm British time, with the first exit polls being released around 6:30. Although opinion polling isn't allowed in the country in the two weeks leading up to the election, various organisations have been conducting their own private polls, many of which reportedly point to the conservative New Democrats winning by a hair's breadth.

There are still a number of undecideds in the Greek electorate, however, and analysis has been devoted to trying to determine what is likely to swing them. Some jokingly suggest that the results of Saturday's football match against Russia (which Greece won in a surprise 1-0 result) may lead to the Greeks feeling more emboldened to elect a candidate who will stand up to Europe; others that it may make them feel better about the whole situation and just want to play along.

Something which may have a real effect on the polls was suggested by Business Insider's Joe Weisenthal: taxes. Owing to the backwards nature of the Greek tax system (which still involves paying much of the bills in person with cash), the caretaker government hasn't levied any taxes in the run-up to the election. But they are widely expected to be raised in the next couple of days, which means many Greeks are heading to their accountants:

Okay, so in the past several days people have begun preparing their post-election taxes, and they've been hit with sticker shock. The new austerity reforms have seen some major increases in tax bills for the average Greek... sometimes to the tune of 300-400 per cent, according to one person familiar with the intricacies of it all.

This has got people particularly angry, and it could be this trend which causes people at the last second to turn away from [the leader of the New Democrats, Antonis] Samaras with disgust, and vote for [the leader of the SYRIZA, Alexis] Tsipras.

Many in the European establishment see the election of Tsipras as the worst case scenario for Greece, fearing that it will lead him and Angela Merkel to enter into a game of chicken which will result in Greece being ejected from the euro. But the Financial Times is reporting that one even worse outcome may be about to occur; a hung parliament:

Private opinion polls showed that none of the parties would win a parliamentary majority. The centre-right New Democracy party had a three-point lead over the radical left Syriza coalition, but neither party would capture even 30 per cent of the vote, according to two private polls seen by the FT. . .

A delay in forming a coalition, or in the worst case, a recourse to a third election if negotiations fail, could cause Greek public finances to collapse. Officials at the finance ministry said last week that unless a delayed €1bn tranche of EU-IMF funding is paid, funds to pay pensions and public sector wages would be exhausted by July 20.

The World Bank's outgoing head, Rober Zoellick, has told the Observer that Europe is one step away from a "Lehmans moment", but much of his criticism was focused on the deleterious effects of uncertainty in Europe on developing nations. That uncertainty will either be cleared up, or magnified greatly, by events today.

Polling slips for the two main parties, SYRIZA and New Democracy, in a polling station in Athens. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Theresa May gambles that the EU will blink first

In her Brexit speech, the Prime Minister raised the stakes by declaring that "no deal for Britain is better than a bad deal for Britain". 

It was at Lancaster House in 1988 that Margaret Thatcher delivered a speech heralding British membership of the single market. Twenty eight years later, at the same venue, Theresa May confirmed the UK’s retreat.

As had been clear ever since her Brexit speech in October, May recognises that her primary objective of controlling immigration is incompatible with continued membership. Inside the single market, she noted, the UK would still have to accept free movement and the rulings of the European Court of Justice (ECJ). “It would to all intents and purposes mean not leaving the EU at all,” May surmised.

The Prime Minister also confirmed, as anticipated, that the UK would no longer remain a full member of the Customs Union. “We want to get out into the wider world, to trade and do business all around the globe,” May declared.

But she also recognises that a substantial proportion of this will continue to be with Europe (the destination for half of current UK exports). Her ambition, she declared, was “a new, comprehensive, bold and ambitious Free Trade Agreement”. May added that she wanted either “a completely new customs agreement” or associate membership of the Customs Union.

Though the Prime Minister has long ruled out free movement and the acceptance of ECJ jurisdiction, she has not pledged to end budget contributions. But in her speech she diminished this potential concession, warning that the days when the UK provided “vast” amounts were over.

Having signalled what she wanted to take from the EU, what did May have to give? She struck a notably more conciliatory tone, emphasising that it was “overwhelmingly and compellingly in Britain’s national interest that the EU should succeed”. The day after Donald Trump gleefully predicted the institution’s demise, her words were in marked contrast to those of the president-elect.

In an age of Isis and Russian revanchism, May also emphasised the UK’s “unique intelligence capabilities” which would help to keep “people in Europe safe from terrorism”. She added: “At a time when there is growing concern about European security, Britain’s servicemen and women, based in European countries including Estonia, Poland and Romania, will continue to do their duty. We are leaving the European Union, but we are not leaving Europe.”

The EU’s defining political objective is to ensure that others do not follow the UK out of the club. The rise of nationalists such as Marine Le Pen, Alternative für Deutschland and the Dutch Partij voor de Vrijheid (Party for Freedom) has made Europe less, rather than more, amenable to British demands. In this hazardous climate, the UK cannot be seen to enjoy a cost-free Brexit.

May’s wager is that the price will not be excessive. She warned that a “punitive deal that punishes Britain” would be “an act of calamitous self-harm”. But as Greece can testify, economic self-interest does not always trump politics.

Unlike David Cameron, however, who merely stated that he “ruled nothing out” during his EU renegotiation, May signalled that she was prepared to walk away. “No deal for Britain is better than a bad deal for Britain,” she declared. Such an outcome would prove economically calamitous for the UK, forcing it to accept punitively high tariffs. But in this face-off, May’s gamble is that Brussels will blink first.

George Eaton is political editor of the New Statesman.