Divided Greece "risks social explosion"

ATHENS (Reuters) - Pro-bailout party New Democracy may have come first in Sunday's Greek election but the radical left anti-austerity SYRIZA bloc was celebrating like the real winner well into the warm Athens night.

The election exposed a struggling nation deeply divided over whether to implement a harsh austerity package, the price for receiving a total of 240 billion euros in bailout money from the European Union and IMF to save its near-bankrupt economy.

"My biggest fear is of a social explosion," said a senior adviser to the country's likely next prime minister, New Democracy leader Antonis Samaras.

"If there is no change in the policy mix, we're going to have a social explosion even if you bring Jesus Christ to govern this country."

According to official figures with 99.9 percent of the votes counted, Samaras's conservative New Democracy party won just 29.7 percent of the vote, only 2.7 percentage points more than SYRIZA, which almost doubled its support from the previous election held on May 6.

When the votes for Greece's other anti-bailout parties, ranging from the neo-Nazi Golden Dawn to the Marxist-Leninist KKE, are added to SYRIZA's tally, up to 52 percent of Greeks cast ballots against the terms of the international deal.

New Democracy supporters had initially slumped despairing in their seats at the party's plush new headquarters as exit polls showed less than half a percentage point separating them from SYRIZA, only to cheer up as official results showing a better performance trickled in.

Even then, celebrations were muted. "What is there for us to celebrate ?" a member of Samaras's inner circle said. "Our country is in such a deep crisis."

The streets of central Athens are scarred with repeated waves of protests, some hospitals are running short of vital medicines, thousands of businesses have closed, beggars and rough sleepers are multiplying and suicides are rising.

New Democracy's Samaras now faces the awkward task of convincing the centre-left PASOK movement to join a coalition charged with implementing highly unpopular spending cuts and privatizations, while the economy nosedives.

Under the terms of the international bailout, the new government must fire up to 150,000 civil servants, slash spending by 11 billion euros this month, sell off a swathe of state-owned companies, improve tax collection and open closed professions to competition.

Once Greece's ruling party, PASOK's support collapsed to just 12.3 percent in Sunday's vote, giving the two pro-bailout parties just 40 percent of the popular vote, not a strong mandate for austerity.

A PASOK-New Democracy coalition is guaranteed a parliamentary majority thanks to a quirk of Greek electoral law which gives the winning party a bonus of 50 extra seats. But that will not win it the argument on Greece's streets.

The Greek economy is expected to shrink by 5 percent this year after contracting 7 percent last year and unemployment is running at almost 23 percent. Many economists believe that the harsh austerity measures will only make matters worse in the short term.

Ominously, PASOK's first reaction to the results was to say it would support a new Samaras administration but not formally join it, hardly a recipe for stable government in a country which has had two elections in less than two months.

PASOK leader Evangelos Venizelos has previously said he would only formally join a coalition if SYRIZA did so as well, something which is politically impossible, given the radical left bloc's unstinting opposition to the austerity measures.

Greek analysts noted that SYRIZA's charismatic 37-year-old leader, former student communist Alexis Tsipras, conceded defeat quickly in a phone call to Samaras, apparently relieved he was free of the pressure to form a government and make compromises.

"From Monday we will continue the fight," Tsipras told cheering supporters in an open-air square outside Athens university. "...the next government after this one will be a left government."

"We will fight to topple these policies," the youthful crowd chanted back as loudspeakers played World War Two Greek Communist resistance songs.

Filippos Nikolopoulos, a sociology professor at Crete University and SYRIZA supporter, said that Tsipras's fans were jubilant because they had won new force and authority by increasing their share of the vote so much on Sunday.

"We want Europe, we want to cooperate," he said. "But we do not want to be subjugated by (German Chancellor) Mrs Merkel."

Stathis Stavropoulos, a newspaper cartoonist famous for his drawings depicting German officials preaching austerity at Greece as Nazi taskmasters, said the new conservative government would have the people of Greece against it from the outset.

"Our dream of European union was very different," he told Reuters. "It was a union of countries and peoples, not a union to serve banks and not a Fourth German Reich."

Using the term for a Nazi regional leader under Hitler's Reich, Stavropoulos added: "Our country is under occupation. How would you feel if they sent a Gauleiter to run your country and tell you what to do ?"

The cartoonist said he had nothing against the German people or other European nations. Indeed, he had never visited Berlin, Paris or London -- but was familiar with Moscow, Beijing and Nicaragua from his Communist activities. "The Soviet Union may have ended but not the dream of democratic communism," he sighed wistfully.

(Editing by Anna Willard)

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