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My two cents on Portugal’s political stability 
And a thread (1/n) https://www.ft.com/content/f3d22d4f-39da-4623-828a-eb04aeb4ce20
And a thread (1/n) https://www.ft.com/content/f3d22d4f-39da-4623-828a-eb04aeb4ce20
One natural explanation for the deterioration in relations between the gov and the left-wing BE is the narrowing of shared common ground, after the "reversing austerity" agenda was exhausted in 2015-19 (2/n)
We got a first glimpse of this structural rift in the aftermath of the 2019 election, when government formation talks between the two parties broke down. Differences stem from the gov’s reluctance to spend and divergences over labour market (3/n)
Also, the BE entered budget talks with stronger political leverage than in previous negotiations. This was possible because the PCP distanced itself from the gov immediately after the election, leaving the BE as the seemingly only viable option for the 2021 budget (4/n)
While this allowed the BE to capitalise on momentum and step up its demands, it also made it harder for the party to moderate its position once the PCP joined negotiations last-minute (5/n)
The context also matters. The BE knew it could afford to reject the 2021 budget since Mr Costa isn't in a position to call a snap election. Because of the limits the Constitution places around presidential elections + imminent EU council presidency (6/n)
The pandemic is not the driver of the split, which imo is a natural consequence of the decision by all sides not to reach a political pact for the legislature. This obviously makes policymaking extremely difficult as it increases political competition btw parties (7/n)
Passing legislation could even become more difficult, as the PCP is unlikely to accept acting as the gov’s main supporter for long. However, it doesn't mean that risks of a gov collapse have automatically increased. We will have to see how polling trends evolve (8/n)
The PS's popularity hasn’t tanked and support for left-wing parties didn’t meaningfully moved. A snap election would risk being useless, so if push comes to shove both sides are likely to be forced into an agreement. This ensures some degree of stability in the medium-term (9/n)
Polling trends could ofc change until 2023. The pace of economic recovery and the spending of EU recovery money will be the main things to watch. Local elections in late 2021 will provide an updated snapshot of the PS’s popularity, which could change everyone's calculations.
