Friday, June 17, 2011

A long day in Greece

Economist
June 16, 2011

For aspiring Socialist cabinet ministers, anxiously clutching their mobile phones in anticipation of a call from the prime minister’s office, it was an interminable day. George Papandreou had promised to announce a sweeping reshuffle of his government on Thursday in an attempt to reinvigorate Greece’s battle to stave off default. But the timetable has now slipped by 24 hours, at least.

One possible reason for the delay was that Mr Papandreou found himself unexpectedly forced to defend his handling of the debt crisis at an emergency meeting of MPs in his party, the PanHellenic Socialist Movement (Pasok). It was convened by Vasso Papandreou, a former European commissioner (and no relation of the prime minister). Typically blunt, Ms Papandreou, a fierce critic of European Union and IMF programmes intended to put Greece’s economy back on track, said that the austerity measures had failed and told Mr Papandreou he should sack a group of his personal friends who are also members of his cabinet.

Another was the reluctance of high-profile politicians to accept a portfolio in a government that may survive only a few months, or less. In particular the finance minister’s job, which means overseeing a new EU-IMF package of painful reforms, is a poisoned chalice. With Greece stuck in recession and the official unemployment rate above 16%, George Papaconstantinou, the incumbent, has become a liability.

Evangelos Venizelos, the ambitious defence minister and a possible future contender for the party leadership, turned down the post. Anna Diamantopoulou, the education minister and another former European commissioner, might be willing to give it a try. But the lack of enthusiasm for such a senior post suggests that senior Pasok figures are not convinced the latest reform package will work.

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