Portugal comes full circle to Socialist minority rule -- and political instability?

Portugal is in some ways right back where it started from seven years ago. Monday's general elections left the Socialist Party of former Prime Minister Mario Soares with the largest share of the vote, but not a majority.

The results of the vote were almost the same as those of the 1976 general elections, the first after the overthrow of the dictatorship, when no single party won enough votes to rule alone. This does not augur well for political stability.

The task of governing Portugal and getting the country out of its economic mess now falls on the Socialists after three years of right-wing rule.

After the vote, Soares reminded the Portuguese that the Socialist minority government he formed after 1976 collapsed within two years under the combined opposition of the right and the Communists.

The difference was, he said, that the economic problems are now far worse than after the revolution and that democracy really cannot afford more general elections to break the political deadlock at such a time of crisis.

Many feel Monday's vote was the last chance for Portuguese democracy, or rather for the parliamentary system and the political parties which have run the country since the military bowed out after the revolution.

So indicate foreign bankers who have lent Portugal $13 billion since 1976 and who despair of ever getting it back if Portuguese politicians continue to quarrel. It is also the opinion of men surrounding Gen. Antonio Ramalho Eanes, the enigmatic President who is the democratic regime's last military link.

Should the Socialists fail to form a stable government and should Parliament once again have to be dissolved because the political parties cannot agree, Portugal's last card would presumably be General Eanes.

The President must step down in 1985 as he is constitutionally barred from seeking a third consecutive term. He will therefore be available for a new political role.

Soares himself warned the Portuguese on Monday night that if the Socialists failed in their task, it was the future of democracy itself which would be at risk. That is strong language. But then the prospect of what will happen to Portugal if the present political confusion continues while the economic crisis worsens is daunting.

To secure a stable government, Soares needs to form a coalition with another party. He has excluded any agreement with the pro-Soviet Communists. The Christian Democrats have already said they will go into opposition.

That leaves the Socialists with the most divided party of all, the Social Democrats. Even before the votes had been counted, some Social Democratic leaders were already publicly saying they would oppose any attempt to take the party into an alliance with Soares.

Portugal has been ruled by a caretaker Cabinet since last December because of the collapse of the alliance between the Social Democrats and the Christian Democrats.

The four-month political crisis, however, looks far from over. Every day it continues, it enhances the standing of General Eanes, the austere soldier-president who was elected with more votes than any political party.

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