Greece and the recent financial crisis: meltdown or configuration?

The recent financial and subsequent sovereign debt crisis caused shock and awe in Greek politics. For the first time since the restoration of democracy in 1974, Greece entered a period of prolonged recession from 2008 onwards. After signing up to the Troika (European Commission, European Central Bank and International Monetary Fund) bail-out in 2010, the recession intensified and was coupled with significant and widespread cuts in public spending and benefits along with big tax rises. Greece also had to implement a series of unpopular labour market and welfare reforms, restructure its state apparatus and proceed with mass scale privatisations. This economic and policy shift affected Greek politics immensely. The immediate impact of the crisis was a dramatic rise in protests, strikes and public discontent. The long-term impact seems to be the extensive reconfiguration of the post-1974 political system: in the June 2012 elections Greece’s two major parties witnessed a dramatic decline in their vote share, while - for the first time in Greek history - extreme-left and extreme-right parties’ popularity rose considerably.