For Greeks, Election Puts Future on the Line

This vote could determine whether Greece will make the choices needed to keep up with the European Community or lag behind, play a supportive or disruptive role in the Balkans

ESPADIA BOUTSIAS, a shopkeeper in Athens' historic Plaka district, tosses her henna-red hair to one side and gestures up to the brilliantly illuminated Acropolis.

``That is how old our political leadership is,'' she says, ``and I'm not just talking about age. We need new ideas, new decisions to solve the difficulties Greece is in,'' she adds, ``but no one is talking about that. It's the same old politics.''

In parliamentary elections here Sunday, Greek voters will ultimately decide which of two septuagenarian men, conservative Prime Minister Constantine Mitsotakis or former Socialist Premier Andreas Papandreou, will lead their country for the next four years. The contest has been characterized as ``the race of the dinosaurs,'' both because of the men's ages and because of a growing feeling that their brand of often vindictive party politics is a thing of the past.

The dinosaur comparison has provided commentators and cartoonists with a lot of fun. But for many observers and analysts, the merriment should not obscure the fact that these will be among the most important elections in Greece's postwar era. The government and the outlook it embraces, they say, may determine whether Greece remains economically and politically a member of the Western community, or whether it lags behind, lost in an economic tailspin and prone to paranoia about its neighbors.

And the outcome of those questions will play a central role in determining the stability of the Balkan and Aegean regions.

``Everyone agrees that getting involved in a Balkan conflagration or going to the brink with Turkey would be absolutely disastrous for Greece,'' says Theodore Couloumbis, president of the Hellenic Foundation for Defense and Foreign Policy in Athens. ``The question is whether sensible decisions are made on some of our emotive issues to encourage the stability everybody wants.'' Armed to the teeth

Greece now has the highest spending on defense as a percentage of gross national product (GNP) - just over 6 percent - of any Western country, with Turkey not far behind at 5 percent. ``Both countries are arming themselves to the teeth,'' says Mr. Couloumbis, noting that a long list of territorial differences, including Cyprus, keeps ties tense.

Most reassuring in Couloumbis's view is the fact that ``the two major parties share a foreign policy orientation that is firmly anchored in the European Community and NATO.'' Yet if he remains less confident that the right decisions to reduce regional tensions will be made, it is because of the country's recent poor handling of the Macedonia issue.

A wave of nationalist frenzy passed over Greece when the former Yugoslav republic of Macedonia last year sought international recognition as simply Macedonia. Noting the historical and cultural importance of ``Macedonia'' to the entire region, Greece said monopolization of the name by one country constituted a provocation.

But Greece's position irritated its Western allies, and fouled its relations with a northern neighbor whose economic and political stability is in Greece's interest.

It was also the Macedonia question that brought down the Mitsotakis government, forcing elections six months early. After Mr. Mitsotakis fired his foreign minister, Antonis Samaras, for espousing a harsh position on the issue, Mr. Samaras formed his own party, which pulled away enough New Democracy members of parliament in September to deny the government a majority. It's the economy

Yet for most Greeks, foreign policy takes a back seat to the economy. The public fears that without some kind of change, personal income will continue to fall and Greece will slip further behind prosperous Western Europe.

For New Democracy, victory for the Panhellenic Socialist Movement (PASOK) would mean a return to the policies of the 1980s, when PASOK spent profligately, nationalized ailing industries to save jobs rather than encouraging modernization, and sank Greece into debt.

Socialists contend that their rule brought Greeks a higher standard of living. They hint there will be no return to the free-spending ways under a new PASOK government, but that future taxes will be more evenly shared. ``Our emphasis will be on social justice,'' says Christos Papoutsis, a PASOK spokesman.

In line with that thinking, the Socialists threaten to slow, if not reverse, the government's privatization program, which had started attracting foreign investment and much-needed revenue.

Economists have some praise for the Mitsotakis government's economic policies, especially since last summer when new taxes were approved and tax evasion efforts were reinforced. The Organization for Economic Cooperation and Development recently said Greece is ``in the process of overcoming the structural and macroeconomic imbalances of the 1980s.'' Debt remains high

But not everyone here is so confident. ``I see no guarantee that the slim benefits of this government's 3-1/2 years in power are here to stay,'' says Nicos Christodoulakis, professor at the Athens School of Economics and Business. The government waited too long to tackle the tough problems - including a national debt that stands at 116 percent of GNP. ``After several years of hardship our deficit is just a little below the level of 1980,'' he says.

Two worrisome points also augur poorly for future economic improvement, adds Mr. Christodoulakis. First, the outgoing government followed a ``scorched earth'' policy over the last month, hiring thousands of new employees and raising farmers' pensions. That will reduce any government's margin of maneuver.

And second, the likelihood of new parliamentary elections in May 1995 will push the new government to take only electorate-pleasing economic decisions.

That new government will probably be in the hands of Mr. Papandreou. Last-minute polls show PASOK maintaining a comfortable lead, even though the ``undecideds'' remain high. Still, meetings Papandreou has held with industry leaders to promote a ``social contract'' between management and labor to tackle economic issues, indicates a confidence that he's one ``dinosaur'' not yet ready for extinction.

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