(Greek PM) Papandreou’s options

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Alexis Papachelas is a guest editorial writer to The Business Thinker. He is currently the Executive Editor of the long standing and highly respected daily Greek newspaper “Kathimerini”.

Prime Minister George Papandreou does not seem to be on top of things anymore. The contradictory decisions and back-pedaling of the Socialist administration are leading the troubled nation closer to the ballot and all that amid growing social turmoil and empty state coffers.

It’s high time that Papandreou made up his mind. Under normal circumstances, it would make sense if he waited for the Greek Parliament to vote on the midterm fiscal plan, weigh the reaction of the European Union and then make a decision.

But these are not normal circumstances. In society as well as in Parliament one can see the emergence of violent dynamics that allow no room for endless discussions and speculation. People can see clearly that they are ruled by a bad government and a prime minister who has no clear plan about where he wants to take the country.

One solution — a solution fraught with peril though — would be to hold a snap election. That scenario, of course, contains the risk of a suspension of payments in the middle of campaign period. It would also be a shock for Greece’s European partners and lenders who, driven by the belief that Greece’s leaders and society are unable to handle the crisis, would start generating scenarios of a Greek exit from the eurozone. That said, a general election would provide some sort of catharsis, as it were.

A second solution for Papandreou would be to form a more efficient government by recruiting a small group of highly efficient staff rallied around a common goal. Not in the coming week, of course, or the week after, but now.

Such a reshuffle would enable the Socialist leader to send a signal to society that he is breaking with the old guard and with old tactics. Even if the premier were ousted by the old PASOK, Papandreou would still be able to claim the vote of the middle class that has lost confidence in his ability to govern the country.

There are no other solutions. Unless, that is, our political system — particularly the PASOK and New Democracy parties — is so frightened of developments as to be convinced into a coalition government that will go on to negotiate a new memorandum with the country’s foreign lenders and actually get down to ruling the country.

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