If this post had been written a few weeks ago, the tone might have been very different. At that time, it would probably have referred the lack of “good news” for the center-right government; the turmoil inside the governmental coalition between the Social-Democratic Party (Partido Social Democrata, PSD, center-right) and the junior partner, the Social and Democratic Center/Popular Party (Centro Democratrico e Social/Partido Popular, CDS/PP, conservative); and the desire of the opposition Socialist Party (Partido Socialista, PS, center-left) for an early general election.

Recently, though, the government has received some “good news”: the 2012 budgetary goals were met, even though one-shot measures helped; a sale of State bonds was very successful; the balance of trade was in surplus, even though this was due more to the fall of imports than to the success of exports; and the new European Union budget proposal mostly spared Portugal from cuts. What is more, the Socialist Party has experienced some internal difficulties: its current leadership had to counter a “coup” from members of the former leadership, who blame the present general secretariat for its weak opposition to the government’s measures and for the way it has distanced itself from the last Socialist administration (2005-2011) and its Prime Minister, José Sócrates.

You might say that these unforeseeable political events mirror the economic, financial and social difficulties that Portugal’s faces. Nevertheless, they run the risk that any post on the Portuguese political arena may soon be out of date. Therefore, the question arises: what can be said that might last?

To answer such a question, the best way is to go back to the event that established the current political configuration: the 2011 early general election. The election was called by the President, Aníbal Cavaco Silva, after Prime Minister Sócrates quit. The Socialists lost and a new center-right coalition government was formed, led by Pedro Passos Coelho from the Social-Democratic Party. Since then, Portugal has been under the scrutiny of the now infamous troika (the European Central Bank, the European Commission and the International Monetary Fund). The agreement with the troika was signed by both the government parties (PSD+CDS/PP) and the opposition socialists. In this context, what can we say about the Portuguese government and its coalition majority, the opposition and the Head of State?

The government and the majority have had to battle very adverse conditions. The budget deficit and the level of Portuguese debt are not yet sustainable; the positive results of government decisions are limited, and the margins for action are small and getting smaller still. There have already been tax hikes, commodity bill increases, pension cuts, civil service salary cuts, social safety net reductions, and privatizations. Over and above cuts and hikes, State and structural economic reforms are either still on the “to do list” or have produced few results. At the same time, growth is absent and unemployment is reaching historical heights. Ever growing parts of the population are finding it difficult to manage daily life. It is said that in order to avoid international and market criticism and sanctions and to avoid comparison with the Greek case, the government has painted itself into a corner with public policies that cripple the Portuguese economic future and put in danger the country’s social fabric. From a more political perspective, it is said that the Ministry of Finance and its austerity measures have hijacked the government, which is criticized by the coalition junior partner, the CDS/PP. It is said that the government and its leader, Pedro Passos Coelho, are unable to go beyond a day-by-day management and create the conditions for growth policies and critical reforms.

The Socialist Party could have profited from this situation and the lack of popularity for the government majority, but it has not. First, it is held responsible for allowing the troika to enter the country, and for its inability to distance itself from the government of José Sócrates and its ignominious end. Furthermore, it should not be forgotten that the Socialist Party also signed the agreement with the international institutions that are today constraining Portugal’s sovereignty. In other words, the PS is in an uncomfortable situation: it criticizes the choices the government makes, but is still committed to meeting the international community’s demands; it does not say clearly what it would have done differently since 2011 and it does not have a different general plan for the future. At the same time, the party’s internal situation is deteriorating with the current leadership unable to establish a balance sheet of the former leadership and the last PS government. This has generated a growing conflict within the PS between the party’s factions. To put it another way, the Socialist Party has not been able to capitalize on popular discontent and therefore is not a credible alternative to the current government.

Re-elected a few months before the last general election, the President is not in an easier situation either. His criticism of José Sócrates’ government was one of the reasons for its fall. Since the PSD – his former party – and the CDS/PP have been in power, he has made several appeals for a fairer distribution of “sacrifices”, for more genuine care to be shown to the most fragile part of the population, and for a deeper reflection and action in favor of economic growth and structural reforms. His appeals have been growing more apparent, and his criticism of the current government has become less and less veiled. But President Cavaco Silva made a mistake when he said that he was finding it difficult to make ends meet personally and this has taken a big toll on his popularity and credibility. Furthermore, his defense of the troika agreement does not give him much room for manoeuvre. To illustrate this point, he refused to veto or to postpone the promulgation of the 2013 austerity budget by sending it for judicial review; instead, he choose to promulgate it and only then to send it to the Constitutional Tribunal. That said, elements of the political scene have variously asked the President to call an early general election, to nominate a broader-based government with members of the three parties that have signed the troika agreement, and to create a new “à la Monti” executive. In other words, even though he is weakened, the President is still seen as an actor of last resort in terms of bringing about a solution to the country’s economic, social and political problems.

In order to conclude this piece, one can say that Portugal’s immediate prospects look bleak. For now, the far left parties – the Left Block (Bloco de Esquerda, Trotskyist) and the Portuguese Communist Party (Partido Comunista Português) – and the trade unions have managed to come together and handle the social and political discontent, but they are not able to build a credible alternative to the normal governing parties. With parliamentary and presidential elections not scheduled until 2015 and 2016 respectively, the growing discontent of increasingly large parts of the Portuguese population puts the political and social institutions under great stress: that this situation might have violent even dangerous outcomes for Portugal’s domestic stability cannot be excluded.

At the end of this year, there will be local elections. A large defeat for the parties in Government is anticipated and, in particular, for the senior coalition partner, the PSD. The large Sintra and Oporto municipalities will certainly be lost; the Socialist Party will maintain its majority in Lisbon. Even though the consequences of these elections at a national level are unpredictable, it is hoped that they will clarify the political arena and offer a clearer set of potential governance solutions.

I would like to thank Professor Elgie for giving me the opportunity to write this post.

Paulo José Canelas Rapaz (canelasrapaz@gmail.com)

Dr Canelas Rapaz has just completed his doctoral dissertation on the Portuguese presidency at l’Université Panthéon-Assas-Paris II