Socialists set for comeback as Greece votes

Greeks voted today in an election that the socialist opposition was expected to win due to discontent with the government's failure to crack down on corruption and its handling of the economic crisis.

The socialist PASOK is not certain of gathering an outright majority, however, raising the risk of weeks of political limbo when the Mediterranean country, seen as the euro zone's weakest link, must deal with an economy on the verge of recession.

Weakened by scandals and a fragile parliamentary majority, conservative Prime Minister Costas Karamanlis called the snap poll in September, gambling his New Democracy party had a better chance of winning now than later in his four-year term.

Opinion polls show a majority of Greece's nearly 10 million voters are frustrated that corruption continues to pervade every aspect of life and have not been convinced by Karamanlis' call for two years of austerity to put the slowing economy back on track, including a public sector hiring freeze.

"I voted for PASOK because I was disappointed by the previous government, the only thing we got from them was indifference and apathy," secretary Dimitra Seseri, 59, told Reuters after casting her vote in Athens.

"I want to see changes."

PASOK's leader George Papandreou has offered a very different strategy to tackle the country's economic woes, promising a 3 billion euro ($4.36 billion) stimulus package on a platform of taxing the rich and helping the poor.

Karamanlis has called Papandreou's ideas unrealistic.

"Today, the Greeks ... decide for a safe way out of the crisis, they decide for policies that are difficult, but guarantee a dynamic jumpstart in the race for growth from 2011 onwards," he said as he cast his vote in northern Thessaloniki.

Karamanlis, 53, a powerful speaker who appeals to the average Greek, and Papandreou, 57, a soft-spoken politician born in the United States, are heirs to two of Greece's most powerful political dynasties and are facing off for the third time.

Karamanlis won in 2004 and 2007.

Many seemed weary of the same faces in Greek politics.

"I don't expect anything of the actual political leaders, they are incapable, corrupt, they should retire and give their place to the younger people," said pensioner Georgios Thassoulas.

BUDGET STRAINS AHEAD

Whoever wins today's election will have to deal with a budget deficit topping 6 percent of GDP, the second-highest debt load as a percentage of GDP in the euro zone, rising unemployment and deep unhappiness with the education system and illegal migration.

After years of robust growth, Greece's output, about 2.5 percent of the euro zone's total economy, is set to slow to zero growth or even enter negative territory this year, with key drivers and job providers like tourism particularly hard hit.

Greece last year suffered its worst riots in decades, triggered by the police killing of a teenager and fanned by high youth unemployment and disenchantment with the political system.

Leftists and anarchists have staged various attacks since then, culminating in the assassination of a policeman in June. Leftist guerrillas claimed responsibility for a bomb that went off on Friday near a Karamanlis rally but caused no injuries.

If PASOK does not get an outright majority, it has said it will call another election in which it would have an advantage with a 10-seat bonus, but which would take at least another 30 days.

Most Greeks and markets favour an outright winner, saying a strong government is needed to take on long-delayed structural reforms.