By returning a verdict for a coalition of mainstream parties in Sunday’s poll, viewed widely as a referendum on Athens’ continuation in the eurozone, the Greeks have shown they have not lost hope in the politics of moderation. In an encouraging show of sagacity this time, traditional rivals — the rightwing New Democracy (ND) and the Pasok socialists — are putting their heads together to provide what everyone hopes will be a stable government. There are already signs that Europe’s leaders are inclined to ease the terms of the Greek bailout. Sunday’s elections, the second in as many months, saw a surge in support for the radical left — a 10 per cent rise in vote share over the May polls. For the first time since Greece’s return to democracy in the 1970s, the far-right has also been catapulted into Parliament. The erosion of the political middle-ground in Greece mirrors what has been happening elsewhere in Europe as the continent grapples with the harshest economic crisis since the Great Depression. While ND was in power in the early years after Athens joined the eurozone and enjoyed a credit boom, it failed to undertake crucial reforms that were needed to check rampant tax evasion and other administrative lapses. Greece made headlines when it came to light that its growth figures were inflated in order to show compliance with European Union stipulations. When the debt crisis gripped Greece in 2010, the incumbent socialists were blamed both for the country’s bloated public sector and for the extremely stringent bailout conditions imposed on Greece by its European and international partners.

Both ND and Pasok had, in the latest elections, campaigned on a platform of broad support for the EU bailout moneys in return for fiscal consolidation and austerity measures. But as Prime Minister Manmohan Singh noted in his speech to the G-20 on Tuesday, austerity is of little help if it chokes growth. The leaders of Greece, and the EU, must accomplish the task of pushing structural reforms while simultaneously taking steps to bring unemployment down from the current high level. In the run up to the recent elections, the European Commission, the European Central Bank and the International Monetary Fund appeared impatient for Athens to speed up long overdue reforms. But the troika would do well to weigh the political cost of ramming through unpopular measures that have driven the country to a state of near paralysis. The last thing Greece, Europe and the world need is the instability of another election. Equally, the perpetual threat of exit of one of the member states is the least desirable scenario for the decade-old eurozone.

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