Last Sunday 4 October Passos Coelho’s right-wing coalition won the most votes in general elections in Portugal but failed to win a majority in parliament.
Since then the man who’s imposed on Portugal some of the harshest austerity measures in Europe has been trying win the backing of the opposition Socialists.
If the Socialists refuse to join his government, ‘the most Passos Coelho can hope for from them is periodic support for key legislation like the 2016 budget. It is enough for the Socialists to abstain for that to happen,’ Reuters reports.
But in an unexpected turn of events both the Communists and Left Bloc parties indicated they were willing to discuss forming a government with the Socialists.
Combined, the Communists, Left Bloc and Socialists would have a majority and account for 52 percent of the vote, compared with 38.3 for the outgoing centre-right coalition.
The Socialists alone won 32.4 percent.
The Left Bloc, led by Catarina Martins, a former actress and co-chair of the party, came third in the elections with a surprise doubling of their share of the vote to 10.2 per cent, or 550,000 votes. The communists, led by Jeronimo de Sousa, were fourth, roughly maintaining their share of the vote with 8.3 per cent or 444,000 votes.
In terms of seats, the socialists have 85, the Left Bloc 19 and the communists 17, compared to 104 for Coelho’s right-wing bloc.
Socialist leader Antonio Costa met with de Sousa on Wednesday and will meet Martins on Monday. Costa, after initial talks Coelho on Tuesday, is to meet again this Tuesday.
Who the socialists get into bed with is an open question. They’ve never ruled nationally with the communists, although have shared power locally. The attitude to Europe and its draconian budget rules is likely to be the clincher, ultimately.
Costa says he wants to return more disposable income to families, something both Left Bloc and the Communists would clearly support, but he’s also said that he respects European deficit limits, which will make such any commitment to help working people in the country hard to implement.
Furthermore the Left Bloc and the communists want to see the debt renegotiated, given that at 130 per cent of GDP it is now risen so far its in the realm of what pundits would call ‘unsustainable’ .
They also want to a roll back of a draft of free market changes, including regressive labour reforms, introduced under the and EU/IMF bailout plan of 2011 that was backed by both the Socialists and the PSD/CDS right-wing coalition.
If the Communists want an exit from the Eurozone, Left Bloc is no longer opposed to the Euro currency.
Indeed as Antonio Barroso, senior vice president at the Teneo Intelligency consultancy in London, told Reuters. ‘There is no programmatic convergence of the Socialist Party and the two left-wing parties.’
However the left of the socialist party are keen on a left alliance, and Costa knows he has a responsibility to the majority in the country who voted against austerity.
Next week will be an important week in judging whether Costa’s rhetoric of turning his back on austerity in Portugal is genuine.