The Fear Factor in Greek Elections

New Democracy, the conservative party hoping to win Sunday’s national elections in Greece, recently set up a large stand in Athens’s Syntagma Square. It’s a few steps from Parliament but it’s also about 10 meters from the spot where a 77-year-old pensioner, Dimitris Christoulas, shot himself two months ago to protest the austerity measures choking Greece’s economy. In this campaign, fear is ever-present.

Antonis Samaras, the New Democracy leader, is due to speak in Syntagma on Friday in his final bid to convince Greeks to back his party, which came in first in inconclusive elections on May 6. Samaras is hoping that doubts about Greece’s future will be enough to hold off the surging leftist party, Syriza.

businessweek.com

Paul Krugman: ‘I’m sick of being Cassandra. I’d like to win for once’

The American economist has a plan to escape the financial crisis, and it doesn’t involve austerity measures or deregulating the banks. But will policy-makers, including our coalition government, heed his advice?

By now you will probably have read an awful lot about the financial crisis. Perhaps I’ve been reading all the wrong stuff, but until now I hadn’t managed to find answers to the most puzzling questions. If the crash of 2008 was preceded by an era of unprecedented prosperity, how come most of the people I know weren’t earning much?

guardian.co.uk

Greek recession worse than expected, says Bank of Greece

THE Bank of Greece has warned that the country faces a worse-than-expected recession in 2012, with the economy set to shrink 5 per cent.

It is also urging politicians to make a swift return to cost-cutting measures after the May 6 general election or face «particularly harmful» economic consequences.

Tough conditions demanded for rescue loan deals have pushed Greece into a fifth year of recession and brewed widespread popular discontent.

Some economists fear that politicians may be tempted to relax their focus on reforms after the elections.

«Domestic and overseas conditions do not allow for the slightest complacency or relaxation … Full readiness is required the very day after the election campaign ends,» central bank governor George Provopoulos told the bank’s annual general assembly.

The European Union had recently predicted a 4.75 per cent reduction in Greek economic output this year. As the economy contracts, it becomes more difficult for the government to reduce its deficit.

Mr Provopoulos urged parties to stick to Greece’s punishing austerity measures after the elections.

heraldsun.com.au