Greek election won on sentiment not fact, expert warns

The FINANCIAL — The Greek election was won on sentiment, not fact, a strategy expert at London Business School has warned.

Yesterday’s elections gave Mr Tsipras an unexpectedly large lead, foiling all pollsters and expectations. But talking earlier today on CNN, Michael Jacobides, Sir Donald Gordon Associate Professor of Entrepreneurship and Innovation, London Business School, warned that the election was won on sentiment not fact and that Greece could be back in the headlines sooner than we might wish.

“This was an election won on sentiment more than facts, and negative evaluations even by SYRIZA voters on its handling of the economy did not dent its lead”, Dr Jacobides says.

“Mr Tsipras’s tactic of positioning himself as the “new force”, who fought with an aggressive EU and secured an honourable deal after being pushed around resonated with voters. His slogan “out with the old” managed to inspire faith in the face of remarkable economic decline under his leadership, imposition of capital controls, and the signing of a very tough Memorandum of Understanding. Voters for SYRIZA yesterday believe his rhetoric that he will be the PM to combat corruption.”

And yet Dr Jacobides says, “evidence so far is to the contrary.”

“During his previous tenure his government passed a law replacing judges with union reps in panels assessing civil servants’ corruption allegations, and allowed those convicted of bribery to return to their posts after being convicted at a first instance. Massive voter apathy (with the largest-ever abstention figures) and strategic voting due to the recent electoral law (giving a bonus of 50 MPs to the winning party) helped seal this outcome.”

Greece has spoken at the polls for the third time in a year and after one of the most turbulent political and economic periods in its history. But testing times are far from over. The government faces big tests.

“With a majority of only five seats, the new SYRIZA/ANEL government will soon be tested. It will be called to legislate broadly and deeply to transform the organisation of the Greek state. The changes Greece has agreed to are anathema to both SYRIZA and ANEL politics. Yet any effort to change the MoU will fall on unsympathetic ears. There is substantial Greek fatigue, and hardliners in the EU may be waiting around the corner for the first misstep and tension with Greece to justify a divorce from the Euro”, Dr Jacobides warns.

Heavy reliance on taxes is likely to prove unpopular and may stifle the economy. With no clear plan to attract investment into the country, the government may soon find itself, Dr Jacobides suggests, “caught between an economic rock and a political hard place.”