The cost of reform

On top of the managerial shortcomings taking their toll on the conservative government’s performance, Prime Minister Costas Karamanlis is faced with yet another problem which is putting the brakes on New Democracy’s bold reform program. If the government really intends to get on with the modernization program that the Socialists fell short of carrying out, it will first have to consider some inconvenient realities. Because of the poor shape of the national economy and the EU’s two-year deadline for bringing deficit figures within eurozone limits, the administration cannot afford to appease the public with vote-grabbing social initiatives – standard procedure during Socialist rule. The Karamanlis administration will not solve the big problems unless it takes on union organizations – including New Democracy-affiliated ones – and pressure groups that dislike change. Moreover, economic gloom has swelled the ranks of the new poor. The strain is now felt among middle-income groups at a time when the government must push long-term effective reforms in the public sector that are bound to spur reactions and cost it politically. Although the conservatives are faced with a very difficult equation, it’s time they laid out a clear and comprehensive reform strategy. Such a strategy would enable them to rally their fighting forces and ensure the greatest possible degree of social consensus. The hurdles that Greece has to clear are no secret to the public. People can see the interest groups currently waging a war on Karamanlis’s administration and they know that the government’s reform drive is sincere. But at this crucial moment, the government seems to have run out of political and ideological steam, a prerequisite for boosting the necessary changes and reforms. Some old-style center-right figures have rushed to fill the gap.

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