Alexis Tsipras, the “winner” of the Greek elections, amongst supporters.

Radical left leader Alexis Tsipras could be Greece’s next prime minister. He rejects austerity but backs the euro – and 80 percent of Greeks agree with him – By Jerry Sommer

For many years, Georgia was a staunch supporter of Greece’s center-right New Democracy party (ND). But in the elections of May 6, the 55-year-old voted for a leftwing party for the first time ever – a small new party called the Democratic Left that took around five percent of the ballot.

Georgia is delighted with the outcome of the last elections, which saw the ND fall in popularity from over 33 percent to 19 percent. The other large party, the social democratic PASOK, was hit even harder: Instead of the 44 percent it won in 2009, it garnered just 13 percent of the vote in May this year.

But even that’s too much, says Georgia’s 24-year-old daughter Maria. “First the ND and PASOK ran up huge debts, squandered the money, took bribes and lined their own pockets. Then they implemented the drastic austerity program that has exacerbated the recession. They’re lucky to have had any votes at all.”

Georgia and Maria are typical of Greece’s middle class. The strong-willed mother owned a jewellery shop until it was forced to close by the financial crisis. The drastic austerity policies demanded by the EU and the International Monetary Fund have hit the population hard: Wages and pensions fell in two years by 25 to 30 percent.

As a consequence, the Greek economy shrank in 2009 by 2.5 percent, in 2010 by 4.5 percent and in 2011 by 6.9 percent. This year a further decline of over 5 percent is expected. One in five people is now unemployed. Of Greece’s under-25s, half are without a job.

Since completing her degree in marketing, the graceful, black-haired Maria has joined them. “Advertising is the first place where cuts are made during a financial crisis”, she says. Only a third of Greece’s one million jobless receive unemployment benefit. Maria isn’t one of them because she has yet to have worked a full-time job.

The maximum annual unemployment benefit doesn’t amount to much anyway. It used to be €460 ($570) per month, but that was lowered to €360 with the last raft of austerity measures, and there’s no other form of social support.

Neither Maria nor her mother is in a position to see the light at the end of the economic tunnel. But the prospect of a new round of elections has given them, as well as many other Greeks, some hope. “I think the leftwing Syriza bloc will be the strongest party. And I hope its leader, Alexis Tsipras, won’t cave in but will remain firm in new negotiations with the EU.”

The 37-year-old Tsipras is the clear victor of the May elections. His alliance of smaller leftwing groups took the second most votes on May 6 with 16.9 percent (4.6 percent in 2009). Surveys indicate that in the new elections on June 17, it could even emerge the strongest party with between 25 and 28 percent.

Under Greece’s electoral system, the first-placed party is “given” 50 additional parliamentary seats, so Syriza could theoretically make up 130 of the 300 deputies. In collaboration with other small leftwing parties or the rightwing anti-austerity party, the “Independent Greeks,” Tsipras could end up prime minister.

This could herald bad news for the EU’s current crisis policy. Tsipras wants to keep Greece in the eurozone whilst revoking what’s known as the “memorandum” and its harsh austerity measures dictated by the creditors. The Syriza bloc also wants a moratorium of at least three years on the country’s debt servicing and interest payments.

“That amounts to €20 billion a year, money that we can use to kickstart economic recovery,” said Tsipiras. He thinks the austerity measures have done nothing so far but ruin the Greek economy. “Without a recovery, Greece will never get back on its feet and the creditors will never see their money again,” he said.

The ND and PASOK parties have described Tsipras as a dangerous populist. The bulk of the Greek media are also critical, saying it’s impossible to retain the euro at the same time as abandoning the austerity drive. Nevertheless, it’s a horror scenario that doesn’t appear to hold sway with the population.

“Rather the opposite,” said engineer Vassilis Tsibilis. “The more Tsipras is lambasted, the more suspicious people are becoming. After all, they know that the media is largely in the hands of the ND and PASOK parties.”

80 percent of Greeks want to stay in the eurozone. But just as many reject the necessary austerity programs. So now, ahead of the new elections, the conservatives and the social democrats have joined the call for a chance to renegotiate with the EU and amend the memorandum.

This turnaround may make economic sense. But it lacks credibility, not least because it was the ND and PASOK themselves who recently signed those agreements with the EU. However, if the conservative ND does succeed in becoming the strongest party again, it could achieve a slim parliamentary majority together with PASOK.

That would be welcome news to Berlin and Paris for a start. On the one hand, their sister parties would still be in government. And on the other, the ND and PASOK have committed themselves to going along with the harsh austerity package, even if the results appear to be yielding anything but success.

But the worst could be yet to come: If Greece sinks deeper into recession, new debt cancellation and new bailout packages or eurobonds will be needed.

Nevertheless, 55-year-old Maria views the immediate future with optimism. She runs a small shop on Patission Street, one of Athens’ main thoroughfares. She buys gold – and at the moment, it’s a booming business. “Many people are selling off their jewelery because they urgently need money to survive,” she said. “But in two years’ time, it’ll be over.”

Maria knows that many Greeks are concerned about staying in the eurozone. But she doesn’t appear to be very worried. Greece was supposed to have been teetering on the brink of bankruptcy last September if it didn’t get an immediate new tranche of loans from the EU. Despite the money not being handed over until December, Greece remained solvent.

All the same, two thirds of the EU bailout funds aren’t being funneled into the actual economy, but instead are being used to pay off interest and debts. Writing in the Parisian newspaper “Le Monde,” Greek economist Yanis Varoufakis slammed as “madness” the fact that the European Central Bank netted a profit of €840 million from new loans in May alone. “Greece’s only realistic chance of staying in the eurozone (is) to challenge the terms of its ‘bailout’ agreement,” Varoufakis said.

Georgia shares that view: “The EU could shift and demand less harsh measures.” If that doesn’t happen, Greece will already have to come up with a new austerity plan in June to save between €11 billion and €15 billion. Maria thinks it’s crazy: “It’s impossible. People just can’t take it.”

That’s not quite true. Greece’s more affluent citizens are known for tax avoidance and evasion. The country’s ship owners, who possess 40 percent of EU ship tonnage, made a 2011 profit of €14 billion – almost none of which made it into public coffers due to the special conditions in place for ship owners.

The EU is making every effort to step up the fight against tax evasion in Greece. But still the creditors continue to bolster just the parties that have shielded the wealthy for decades: PASOK and the ND.

Whether both parties will achieve a viable majority on June 17 remains to be seen. Otherwise the government could end up being formed by the Syriza bloc, which has been calling for higher taxes on the rich and serious legislation against tax evasion for years. For Greece’s state revenue, something that’s also crucial to the creditors, perhaps this is the better solution.