Greek government risks mauling after straying off

Agora Contributor: Nick Malkoutzis
Photo by Myrto Papadopoulos [www.myrtopapadopoulos.com]
Photo by Myrto Papadopoulos [www.myrtopapadopoulos.com]

The current Greek government’s propensity for shooting itself in the foot should never be underestimated. Last year proved that SYRIZA is particularly adept at snatching defeat from the jaws of victory but it appears to have outdone itself with the emerging fiasco that is the TV licencing procedure.

Having held it up as a shining up example of its self-professed attempt to tackle the “triangle of corruption” between the media, big business and the political system, much in the way that Rafiki in The Lion King holds up Simba for everyone in the Pride Lands to see, the government now faces a potential mauling from the opposition.

The flaws in the process have provided the government’s opponents with numerous points of attack: The limiting of the number of licences, the lack of any significant criteria apart from the financial, the absence of background checks on the bidders, the exclusion of the constitutionally appointed broadcasting watchdog, the opaque auction and the apparent bending of the rules so the bidder with the supposed closest ties to the government could end up with a permit.

While the opposition parties sense an opportunity, the machinations over the TV permit tender have left the Greek public smelling a rat. According to an MRB poll for Star TV (one of the channels that failed to gain a new permit), 74.2 percent of Greeks believe the process was not handled well. Furthermore, 76.7 percent said the auction would not end corruption and 82.8 percent said there should have been better background checks on the bidders.

To compound the coalition’s problems, the Bank of Greece’s investigation into Attica Bank has also raised doubts about how at least one of the successful bidders obtained his financial strength given that the criteria for issuing loans at the small lender appear to have been well below normal banking standards in some cases.

The potential scandal at Attica Bank does not just affect the government, given that the lender’s unusual practices seem to have been in place well before 2015, but the indication that the bank was increasing its exposure at a time when deposits were plummeting and capital controls were being imposed will only compound suspicions that there was political pressure from those in power since last year on the bank’s management to turn a blind eye.

There have been suggestions that this whole affair will undermine Alexis Tsipras in the same way that the Vatopedi Monastery land-swap scandal did for Kostas Karamanlis and his New Democracy government less than a decade ago. What damaged Karamanlis a few years ago was not necessarily the exposure of a great scandal as nobody conclusively proved at the time how much damage taxpayers had suffered by the exchange of real estate, but it was the constant speculation and drip-feed of revelations that eroded the public’s confidence in Karamanlis who, like Tsipras, was a leader that had strong rapport with voters even when his administration’s ratings suffered on its consistent inability to deliver.

The difference between Vatopedi and the current potential scandals is that the revelations have come in a sudden burst. This gives Tsipras the chance to counter and break through the clouds gathering around his government in a bid to reach a clearing that will give him time to regroup and move on. Months after the Vatopedi scandal broke, Karamanlis admitted publicly to New Democracy MPs and members that his reactions had been to slow and that he should have nipped the matter in the bud. Tsipras may still have the chance to learn from the former conservative leader’s mistakes.

However, the factor counting against Tsipras is that he could face a hard stop. Whereas the Vatopedi scandal involved complicated paperwork and a lengthy court case, the current prime minister faces the possibility that the Council of State will uphold the appeals against the TV licence tender and deem it unconstitutional. This could be a fatal blow to Tsipras’s hopes that the current controversy will blow over.

New Democracy has already suggested that such a ruling from the Council of State, whose judges are due to convene on September 30, would mean that the government should step down. Indeed, it is hard to see how the coalition will justify its position if it is deemed to have breached the constitution on top of organising a tender that was full of holes.

Tsipras betrayed his nervousness about the court’s final decision when he suggested during his recent press conference at the Thessaloniki International Fair that there was no chance that the Council of State would uphold the appeals. Commentators claimed that the prime minister was out of line to speak about an imminent court decision in this way. They said it was another example of the government wanting to intervene in the work of an independent institution.

That Tsipras would take this risk, though, suggests that probably for the first time since he became prime minister he feels that his grip on power may be slipping. What was meant to be his crowning moment as far as his promise to tackle the shady practices of the past is concerned is rapidly turning into a debacle. Unless the government is able to quickly shake off the stigma attached to the allegations, it is difficult to see how it will recover voters’ trust. Instead it could face a rapid deterioration that will leave the government teetering and Tsipras staring at the possibility that he will no longer be king.

*You can follow Nick on Twitter: @NickMalkoutzis

An earlier version of this article appeared in last week's e-newsletter, which is available to subscribers. More information on subscriptions is available here.

1 Comment(s)

  • Posted by: Dean Plassaras

    I fail to see where is the so called licensing fiasco here. The Greek TV advertising market is assessed to be a 200 Mil. euro pie and the break even for a station to survive is 50 million. So giving out 4 licenses was the best way for the state to maximize its licensing revenue. If in the future the Greek TV advertising market grows to for example 300 Mil. euros the government could issue an additional 2 licenses or more as the TV ad pie grows. One of the original 4 finalists couldn't make the cut and has been substituted. Where exactly is the fiasco? Or the overzealous attempts of the opposition to find a fiasco constitute a fiasco so that the opposition could pretend to wage war against something in order to justify its pathetic existence?

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