Long shot

For weeks, Greece was a country that barely had an economy and, strangely, no government. Unless Greece pulls together behind a clear-sighted leadership, it will also be a country without a currency.

Two months ago, Greeks went out to vote for a new government. A great number of them irresponsibly chose to cast a protest vote. The far-left Syriza party, which rejects the EU bailout package and the austerity program it entails gained a significant share of seats. Even the fringe neo-Nazi Golden Dawn party collected enough seats to torpedo any coalition.

As a consequence of that vote, none of the political parties managed to form a government. New elections were called.

This weekend, Greek voters sobered up a bit. The conservative New Democracy party, which supports the fiscal consolidation program to keep the beleaguered country within the Eurozone, managed to win a third of the seats.

New Democracy now holds 129 seats in the 300-seat Greek parliament. Far-left Syriza holds 71 seats while socialist Pasok holds 33. Golden Dawn holds 18 seats. A host of smaller parties holds the rest of the seats.

By the time this piece sees print, New Democracy should have formed a coalition government with Pasok. Intensive negotiations were underway as this was being written. Both parties basically agree in principle that every effort must be exerted to keep Greece within the Eurozone. They had until last night to form a new government.

The markets everywhere celebrated the slight victory won by New Democracy. Indexes bounced up on the possibility that Greece might, at least, have a government in place to manage the fiscal consolidation program.

If the coalition talks failed, and Greece remains without a government, all hell breaks loose.

I will proceed, nevertheless, on the optimistic assumption a coalition government is formed in Athens. That assumption is based on the most recent statements made by leaders of Pasok.

Pasok, a social democratic party, led Greece for many years. This is the party responsible for the lax fiscal management, extensive subsidies and nationalization policies that brought Greece to the debt crisis it now finds itself in. The least it can do for Greece is to help New Democracy climb out of the deep financial hole it finds itself in due to decades of profligacy.

A coalition between former rivals New Democracy and Pasok might seem like a union of strange bedfellows. That, however, is what survival demands at this time.

New Democracy is often described as a “right-of-center” party. Presently, it is led by Antonis Samaras, a Harvard-educated former foreign minister. Samaras is the man who must forge an agenda of unity that must satisfy both the need for the country to abide by the fiscal consolidation agreement that comes with the EU bailout package and the expectation of the people for some relief from the recession implied by fiscal consolidation.

The new government must be sufficiently credible in pursuing fiscal reform if it expects EU support. In turn, EU must be prepared for a longer, less brutal fiscal consolidation schedule pursued by a determined government in order to avert the sort of irrational backlash Syriza represents.

Brazen

Something truly brazen happened while we were all preoccupied with that distasteful impeachment process: the LTFRB resurrected 489 legally dead franchises and these ended up under the control of bus companies owned by one family. The move runs against the grain of this administration’s policy of decongesting roads in Central and Northern Luzon.

The dead franchises once belonged to the defunct Pantranco and covers profitable but sufficiently served routes. The certificates of public convenience (CPC) for the old Pantranco lines expired 20 years ago. All previous attempts to reissue these CPCs were opposed by the main bus companies servicing the same routes, including the companies to which these franchises were recently awarded.

Last Tuesday, on the occasion of the LTFRB’s anniversary, five large bus companies wrote DOTC Secretary Mar Roxas objecting to the recent resurrection of dead franchises. The letter was strongly worded: “Never in the history of the Public Service Law has there been a wholesale grant of 489 units to one bus-owning company. Even the most corrupt schemers under the previous administration dared not resurrect the dead franchises of Pantranco because there was barely any legal cover for reviving certificates of public convenience which validity had expired 20 years ago.”

The complainants point out that a DOTC memorandum to the LTFRB in July 1996 clearly states that the expired Pantranco lines can neither be sold nor transferred. At every previous instance a sheriff sale of the lines were attempted, the LTFRB ruled that these lines were expired. Yet the present LTFRB sold the same lines with undue haste on the basis of an overruled sheriff sale 16 years ago!

The (whole) sale of the old Pantranco lines violated all previous LTFRB rulings banning multiple selling of franchises, the prohibition on the dropping and substitution of units that are non-existent, and the execution of a deed of sale not backed up by a single bus. Only last January 5, 2012, the LTFRB firmly reiterated what the DOTC has been saying for 20 years: that the franchises in question are legally dead.

Further, there is a long-standing moratorium on the grant of provincial franchises except for developmental/missionary routes. The established ruling is that new routes may be opened only if backed up by studies demonstrating a clear need for new franchises.

For these reasons, the complainants describe the award as “brazen and illegal.”

There is something seriously amiss here. Mar Roxas ought to look at the matter very closely.