How did a country that everyone held up as a shining example in meeting bailout terms spiral into political collapse? Was it down to social conflicts? No. It was down to the personalities of the PSD and CDS leaders which have led to more destruction than 100,000 greek demonstrators together. Paulo Portas is like a scorpion that stings its victim, even if that means going down with him. Passos Coelho liked to make his own decisions alone and didn’t know how to work with Portas. (See also: Two surreal political days)
1- Why did Paulo Portas, conservative CDS leader of the minority coalition party, put Portugal’s reputation abroad at risk?
That’s the kind of man he is. It’s not the first time that Paulo Portas - now Foreign Minister – has suddenly blown apart a coalition with the PSD. In March 1999 he directly scuttled another PSD coalition during a TV interview. The then PSD leader, Marcelo Rebelo de Sousa, was forced to resign. The slight difference now is that they had been coalition partners in opposition and did not share the Government at a time when the country was in the middle of a bailout programme.
Despite the official line from the CDS that it is a “responsible partner”, Paulo Portas has already threatened to resign at least twice since September 2012 and that had only been avoided because of the leadership of his party. He has always had a schizophrenic attitude, as though he were in the Government and the opposition at the same time. This time, so as not to be held back, he opted to remain tight-lipped. His secretaries of state, for example, were advised by the boss’s cabinet office only two minutes before he announced his resignation publicly. The CDS received the news in shock. There were MPs close to the leader that on Wednesday had privately said Portas had gone round the twist.
Despite his unpredictable personality, Paulo Portas had been harbouring grudges against the prime minister who he felt had sidelined him. The last straw was the appointment of Maria Luis Albuquerque, the Secretary of State for the Treasury, who replaced Vítor Gaspar as Minister of Finance. Portas made it known to the prime minister that he preferred the appointment of Health Minister, Paulo Macedo, but even so Passos Coelho went ahead with his choice anyway. Portas is seen as a political scorpion: prepared to sting himself as well as as his victim. He couldn’t forgive Passos Coelho yet another slight on his opinion and rather let Portugal lose all that had been clawed back over two years in just one day on the markets.
2- How far was the Prime Minister Pedro Passos Coelho responsible for this crisis?
Very. Passos Coelho has never trusted Paulo Portas and Paulo Portas always thought the prime minister intellectually inferior. When the current president of the European Commission, Durão Barroso was prime minister and was in a coalition with Paulo Portas (2002-2004), he tried to keep him at arm’s length, yet protecting him when he was under attack in the press over a university scandal. Passos Coelho didn’t handle Portas in this way. The prime minister is a lone wolf, preferring to take his own decisions and doing little to make Portas feel “special” within the Government. He appointed Vítor Gaspar as Nº 2 and then stressed the fact in public, humiliating Portas. He told the country various times about austerity measures knowing full well that his coalition partner was against it, opening the way for Portas to make official speeches to the nation against the prime minister‘s decisions. Passos Coelho could have avoided this crisis if he had been different in the way he managed Portas before problems set in.
3 – Does the resignation of the Minister of Finances Vítor Gaspar spell the end of the Government’s support for austerity?
No. Passos Coelho maintains the line that he will do whatever it takes to get the country back to the markets. He is not just thinking about the elections, and the PSD has already accepted that it will probably suffer the worst results ever at the polling booths. Vítor Gaspar felt, however, that he did not have ‘carte blanch’ from the prime minister. Within the Government he was a kind of German from Frankfurt or another member of the troika – belonging to the European Central Bank or European Commission – being on the side of the creditors. In his letter made public, he revealed that he had already requested to leave the Government in October 2012, when Passos Coelho made an important concession to Paulo Portas. In his letter, he revealed that at the time of the 7th evaluation in May, he hadn’t been given a “timely” mandate to negotiate with the troika. All because of Portas. But there are ministers who claim that the prime minister has been stabbed in the back. Gaspar stopped believing that Passos had the strength to continue his arm wrestle with Portas. He was right. Passos kept his strength up but Portas caved in.
4 – What was the role of the President of the Republic Cavaco Silva in this crisis?
Aníbal Cavaco Silva has hated Paulo Portas for years, because of what he wrote when he was the director of O Independente, an investigative newspaper that featured big on the scene in the 90s and contributed towards Cavaco Silva’s unpopularity. He has also never had a good relationship with Passos Coelho despite being in the same PSD party. The President is an institutionalist who defends stability at all costs. He was really annoyed at the sudden resignation of Portas but has spent the last 24 hours trying to stick the pieces back together again. He has had a pivotal role in getting the two big players back to the negotiations table for discussions that started on Wednesday evening and continued into Thursday. Cavaco will do all that is humanely possible to avoid elections.
5- Is the Socialist Party happy at the prospect of returning to power?
The opportunity is a good one, but the timing couldn’t be worse. António José Seguro, general-secretary of the PS, knows that taking power after a crisis such as this could prove great in terms of election results as the electorate give the right a hammering at the voting booths. But he also knows that if he takes power with a second bailout he’d have to take much more unpopular measures than the ones the current government is being criticised for and also without knowing if he would have to make a coalition or not. One PS MP said yesterday that snap elections wouldn’t be good for the Socialists before the elections in Germany on September 22. Only afterwards will it be possible to relieve the stranglehold around Portugal’s neck somewhat, and even then Passos Coelho will still have to fully fulfil the memorandum of understanding with the troika, which only ends in June 2014.
