The 500 Days of M

A Socialist Premier's effort to "lance the wound" proves fatal

After 17 months in office, Portugal's first democratic government in half a century went down in defeat last week. On a vote of confidence Premier Mario Soares' Socialist government lost, 159 to 100, to the combined forces of the Communists on the left and the Social Democrats and the Center Social Democrats (C.D.S.) on the right.

Soares had called the vote of confidence after the breakdown of lengthy negotiations with the other parties over austerity measures designed to help bolster Western Europe's poorest economy. "It was necessary to clarify the situation," Soares told TIME'S Martha de la Cal, explaining why he had asked for a vote in an attempt to break the political stalemate. "We had to lance the festering wound." A last-minute attempt to save the government failed when Soares' Socialists refused to yield any concessions to the Communists, such as easing up on the government's reclamation of seized lands in the heavily Communist Alentejo province, in exchange for their vote.

In retrospect, Soares probably governed longer, exactly 500 days, than he had any right to expect. He came to power with only 34% of the vote (which translated into 102 seats in the 263-member assembly). He had intransigent opposition to the left and right and a disastrous economic situation that he had little power to rectify. Soares inherited a quadrupled price of Arab oil, a depressed economy in which half the country's food and most of its machinery and raw materials were imported, an influx of 750,000 refugees from the former African territories and a 30% inflation rate. Of late even the Premier's personal popularity had begun to slip because of the rising cost of food, inflation that has continued to climb to 33%, unemployment, increased crime and other problems.

From the first, Soares had insisted on governing without political alliances. Any compromise, he feared, would further polarize the country's politics. A leftist front involving Alvaro Cunhal's Communists, the most rigid, undemocratic Stalinist party in Western Europe, would alienate the conservative north and scare off sorely needed Western capital. But an attempt to form a coalition with the Social Democrats and the C.D.S.--which Soares last week castigated as "parties of the extreme right"--would have alienated his own party's rank and file. Meanwhile, the Socialists had the unenviable task of trying to right the wrongs of a series of post-revolutionary leftist, military-led governments. That meant returning to former owners land and factories illegally seized after the 1974 revolutions, borrowing money from the West and pleading for private investment.

Despite the difficulties, Soares could tick off some notable achievements for his 500 days. He restored good relations with NATO, won approval in Europe for Portugal's application to join the European Community and immeasurably boosted Lisbon's prestige in the West, the East bloc and the Third World. He negotiated a series of major loans, including nearly $1 billion in aid from the U.S. At home, all but four of 78 pieces of Socialist legislation presented to the assembly had been passed. Among them: a comprehensive agrarian-reform law, a measure providing compensation for the nationalization of industries and a new civil code granting equal rights to women.

Soares' basic strategy was to play off the opposition parties against each other in order to get a majority vote. But eventually, the Social Democrats and the C.D.S., both of which favor an expansionist economic policy, found it intolerable to support policies that they had no role in formulating. The crunch issue was a proposed $1.5 billion loan from a consortium of Western countries and the International Monetary Fund. The conservative opposition accused Soares of yielding too easily to the IMF's insistence on such restrictions as low economic growth (1%), devaluation of the escudo and other austerity measures.

Most opposition leaders concede that Soares is a subtle and skilled politician. They also complain that he is a poor administrator. "Laws are passed and not carried out," said C.D.S. President Diogo Freitas do Amaral, citing the decline of public services, continued high unemployment and balance of payments deficits. The social peace that has characterized Soares' term has been shattered by several violent demonstrations and bombings. Earlier this month, 20,000 right-wing demonstrators--including wealthy businessmen, dirt farmers from the north and neo-Nazi youth--marched through Lisbon to show their discontent.

There are also ominous signs that the army is becoming more polarized, with many regular officers moving to the right. After conservative General Antonio Pires Veloso was recently removed as commander of the Northern Military Region, Oporto, Portugal's second largest city, was racked by violent demonstrations and bombings. In scenes reminiscent of the post-revolutionary turmoil, three Communist headquarters were destroyed.

Soares and his Cabinet will remain in office as a caretaker regime until the President, General Antonio Ramalho Eanes, names a new Premier to form a government. If a government cannot be formed, new elections must be called. One possibility is that Eanes will ask Soares himself--or possibly an independent--to form a government made up largely of technocrats. Such a nonpolitical Cabinet might be able to fashion an economic salvation plan that the parties would have to accept if a strong case was made that the future of the country was at stake. In any case, Soares is confident that he will be back in power sooner or later. "Within a few weeks or months, when it is seen that another solution does not work," he said last week, "the Socialists will be called upon again."

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