7 Reasons Portugal’s Socialists are Staring into the Abyss

by Craig McVegas and Joana Ramiro

5 October 2015

Much as Portugal has become something of a poster boy for Troika-induced austerity, the Portuguese Socialist Party, Partido Socialista (PS), has so far seemingly defied the trend commonly referred to as ‘pasokification’ – European social democratic parties bleeding support and votes to insurgent left forces in the face of austerity. Despite signing the Troika’s memorandum in the first place and the existence of a well-established Communist bloc within parliament, PS has not only survived but even increased its share of votes and seats – even if it was unable to beat the incumbent right-wing coalition Portugal à Frente (PaF) in yesterday’s legislative election.

So why is it now the case that the Socialists are on borrowed time? Here are seven reasons the Portuguese political landscape is getting interesting:

1. PS gained seats but were last night’s biggest losers.

Compared with PaF’s 28-seat loss, PS’s gain of 11 seats might seem modest but respectable. Nonetheless, PaF still came first – Portuguese voters opting for the continuity candidates despite four years of punishing austerity. PS’s 11 seats are the only electoral gains the party has made in three elections over ten years.

Meanwhile the Left Bloc (BE) and Communist-led coalition CDU each made gains, BE in particular overcoming recent internal disarray to galvanise both the party and over 10% of voters, more than doubling its parliamentary representation. Together BE and the Communists polled 18.5% of the vote.

2. There’s a dearth of leadership in the Socialist ranks.

Given the way these things usually go, it would have been fair to imagine PS leader António Costa would step down, particularly as he was elected with a landslide result to breathe life into the party and deliver a majority.

Instead in his post-result speech he said he “obviously” won’t step down and remains committed to the programme he just lost an election on. Perhaps PS is sticking to its guns because no other guns are an option. António José Seguro, the previous leader, was roundly thumped by Costa’s leadership challenge and the leader before Seguro is currently unavailable…

3. The party is mired in scandal.

Former party leader and prime minister (2005-11) José Sócrates is currently under house arrest, having been imprisoned without charge for the best part of a year pending an investigation into allegations of corruption and tax fraud. The affair has been hanging heavy over PS – the party’s recent slogan ‘Eu Confio’ (I trust) as much a reassurance of party integrity as economic responsibility.

4. PS failed at campaigning.

Despite a newly beefed-up ‘anti-austerity’ rhetoric, the overall election message was a negative rather than a positive one. Rather than push a programme wholly distinct from the government, the strategy was largely to call for the so-called ‘useful vote’ – well-worn ‘we’re not them’ politics – with a few short-termist gimmicks thrown in.

5. Costa has said he won’t take part in a ‘negative majority’.

Asked if he would form a national coalition with PaF, Costa replied he’d only be inclined to in the event of an alien invasion. He may not get into bed with the conservatives, but it doesn’t mean PS is going to be an effective opposition to the government’s agenda.

After the election Costa said he wouldn’t take part in a ‘negative majority’ (subtext: by joining forces with BE and CDU to block the minority PaF administration). He also suggested he won’t stand in the government’s way if he has no viable alternative. Whether this signals early capitulation or an intention to attempt a ‘viable alternative’ with the left is anyone’s guess.

6. PS is about to be squeezed by the left.

Between them, BE and CDU now have a sizeable, consistently anti-austerity bloc in parliament. New legislation will come under stronger and more vocal scrutiny and those parties’ MPs will be piling pressure on PS to put walk the walk, having talked up the anti-austerity cause during their campaign.

Trust in the integrity of PS’s anti-austerity credentials is understandably low – it was the party which signed the bailout memorandum after all. Now PS will either have to clarify its anti-austerity stance to regain votes lost to BE in particular, or it will be shown to support austerity openly.

7. Austerity is likely to get worse.

The headline figures say Portugal’s economy is gradually getting better and becoming more competitive, hence its status as the prodigal son of the Troika’s various European bailout packages. Yet VAT is at 23%, the welfare state is being eroded to make way for privatisation, and wages are frozen. Unemployment is rising, and youth unemployment is nonetheless at around 30%.

Described as a ‘ticking time bomb’, Portugal’s debt situation is notable for being both unsustainable and almost unique in the Eurozone. Debt-to-GDP is around 130%, with about 70% of the debt foreign-owned. Even to keep its debt stable, the economy would have to grow 3% every year.

So far, PS has proved flimsy opposition to PaF’s at-times gleeful cuts. With the parliamentary anti-austerity bloc on the move, PS looks to be the one playing catch-up. Its only hope for avoiding what now looks like impending pasokification would be to form an unprecedented, substantial anti-austerity coalition in the Portuguese legislature. Ask many on the left what they think the chances of that are, and you can’t help but think PS is soon to lose its place at the table.

Thanks to NovaraWire contributor David Ferreira for additional insight.

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