The Greek city-state of Athens is believed to have developed the first known democracy around 500 B.C. Modern Greece has been a democracy since the toppling of a military junta in 1974. Since then, two large parties have alternated leadership of the government: the New Democracy (ND) party and the PanHellenic Socialist Movement (PASOK). ND was in power from March 2004 until October 2009.In the September 2007 national elections, held after the government was criticized for poor performance in fighting widespread fires and some officials were implicated in corruption scandals, ND was able to eke out only a slim majority of 152 seats in the unicameral 300-seat parliament. At the time, PASOK also suffered losses, while three small parties on the left and right registered significant gains and won seats. One of these, the ultra-nationalist, anti-immigrant Popular Reforming and Orthodox Rally (LAOS) party, entered parliament for the first time. After the 2007 election, ND lost one seat in parliament and its position declined due partly to additional corruption scandals, a crisis of law and order, and the economic situation. An ongoing scandal over the Siemens Group's alleged bribery of politicians and officials sullied both major parties. Then, in September 2008, Merchant Marine Minister George Voulgarakis resigned amid allegations that government ministers had helped a monastery trade inexpensive land for prime real estate, at a cost of an estimated $130 million to the government. In October, the same scandal led to the resignation of State Minister and government spokesman Theodoros Roussopoulos, a close associate of then Prime Minister Constantine (Costas) Karamanlis. Perhaps more significantly, the government's ability to ensure public security came into question. In December 2008, police fatally shot a teenage boy, provoking days of violent protests by anarchists, students, and labor groups in Athens and elsewhere. It was the worst rioting in years, and its duration generally was attributed to socioeconomic causes (i.e., the youths' joblessness and lack of hope), although a culture of impunity also was blamed. Critics castigated the government for its passive response and slowness in reestablishing law and order. In June 2009, the murder of a police officer who was a member of the counterterrorism squad protecting a witness in a trial involving a terrorist group again highlighted the government's deficiencies in this area. PASOK polled ahead of ND in public opinion surveys throughout 2008 and 2009, and PASOK leader George Papandreou repeatedly called for early elections. PASOK came in first, and the LAOS registered striking gains in the European Parliament elections of June 2009. In August, Greece again experienced terrible fires and, while they were not as severe as in 2007, some criticized the government for its alleged failure in the intervening years to improve fire protection or to establish better coordination of fire-fighting efforts. The government blamed extremely strong winds for the destruction. Other observers said that the government had mobilized assistance from the European Union (EU) and from individual European governments. The president is head of state, but the prime minister is head of government and exercises most powers. In February 2005, former Foreign Minister Karolos Papoulias, the ND consensus candidate and a founding member of the opposition PASOK, won the presidency with 279 out of 296 votes cast in parliament. His term expires in March 2010. On September 3, 2009, Prime Minister Karamanlis called for early national elections because, he said, he wanted to avoid a protracted pre-election period. Parliamentary elections had been scheduled for September 2011 and now would take place on October 4, 2009. Karamanlis claimed that PASOK had "forced" the early election when it announced that it would not support President Papoulias for reelection. Without PASOK, Karamanlis's ND party would not have sufficient votes in parliament to reelect the president and a national election would have been required in order to reconstitute parliament so that a new president could be elected. Thus, the election campaign would have lasted for at least six months. ND's election prospects were bleak from the outset of the campaign as the economy was experiencing a recession. At the same time, the European Commission estimated that Greece's 2009 budget deficit would be 8% of gross domestic product (GDP), well above the 3% ceiling that the EU mandates for members, and the national debt would be 110% of GDP. (These estimates have since risen.) By October 24, Greece was supposed to present to the EU a package of measures aimed at restructuring its public finances and cutting its fiscal deficit to 3.7% by the end of 2009, which few considered feasible. In addition, commentators and opposition politicians had criticized the government for what they claimed was its poor performance in fighting fires again in August. (However, others thought that the government had mobilized rapidly, but that extreme winds had affected the effectiveness of fire-fighting.) Critics also assailed the government for its failure to improve law and order in the face of domestic terrorism and anarchism. To help Greece overcome its financial crisis, Prime Minister Karamanlis presented an economic plan on September 5. It called for cuts in public spending, freezing public-sector wages and pensions, combating tax evasion, and structural changes. Critics wondered why the party had not done all that in its six years in office, although its one-seat majority in parliament probably constrained boldness. The plan could not have appealed to voting public-sector workers and pensioners. On September 12, PASOK leader Papandreou presented a program for his first 100 days in office, calling for boosting demand with pay increases above the rate of inflation, extra pay for lower incomes, protection of borrowers and households in debt, combating price increases in the market, freezing utility rates for one year, and passing tax reforms to promote redistribution of income. He also proposed increases in public investments, supporting employment by subsidizing social security contributions for new hires of unemployed persons, and increasing unemployment benefits. The PASOK stimulus plan had a price tag €3 billion or U.S.$4.38 billion. Papandreou said that he would fund it with better tax collection, with the EU's National Strategic Reference Framework (ESPA) cohesion policy funds, and public-sector real estate. The smaller parties also presented their views. LAOS leader George Karatzaferis sounded nationalist and populist themes, calling for EU help in guarding Greece's borders against illegal immigrants, the establishment of a quota for immigrants, and stronger policies to combat "the Turkish threat." He attributed a large percentage of what he asserted was a rising crime rate to illegal immigrants. Meanwhile, at the outset of the campaign, the Coalition of the Radical Left (SYRIZA) survived a leadership dispute with the main party in its alliance, the Coalition of the Left Movements and Ecology's (Sinapismos/SYN). SYN President Alexis Tsipras demanded to lead both SYRIZA and SYN, but other parties in SYRIZA resisted, and some wanted the head of SYRIZA's parliamentary group and former head of SYN, Alekos Alavanos, to head the list. SYRIZA entered the elections without a leader at the head of its list and Alvanos did not run for parliament. In the end, it was widely believed that Greeks voted against the ND government more than for PASOK. Voter turnout was 70.92%, down slightly from 74.14% in 2007. Karamanlis resigned as ND leader and assumed a seat as a Member of Parliament from Thessaloniki. His successor is former Culture Minister Antonis Samaras. Prime Minister Papandreou proposed a smaller cabinet, created the new post of Vice President, and reconfigured several ministries. The Ministry of Economy, Competitiveness, and Shipping has been created from some elements of the former Merchant Marine, Aegean, and Island Policy Ministry and others from the former Economy and Finance Ministry. The Ministry of Citizens' Protection took over responsibility for public order from the Interior Ministry along with parts of Merchant Marine Ministry's marine safety and other components. Greece has a mixed capitalist economy, with the public sector accounting for about 40% of the gross domestic product (GDP). In its first term, the ND government cut the budget deficit and taxes on corporations, and was able to raise tax revenues due to an average annual growth rate of 4% and a crackdown on tax evasion. Unemployment decreased at first, but 20% of the population remained below the poverty level. ND also passed some social security reforms, despite political opposition and labor protests. The European Commission wants even more action in this area. Greece sustained its growth due to booms in tourism and shipping. (Greece has the largest merchant marine in the world.) It also plans to ensure its own energy security as well as become a major "energy corridor" with the Turkish-Greece-Italy (TGI) natural gas pipeline, the Burgas (Bulgaria)-Alexandroupolis oil pipeline, the South Stream natural gas pipeline from Russia to Europe, and a gas pipeline between Greece and Bulgaria. However, during the brief second ND term, Greece began experiencing the effects of the global financial crisis and recession, which hurt shipping and tourism among other key sectors. GDP has contracted for three consecutive quarters in 2009. Almost all industrial sectors have seen declines. Unemployment hit 9.6% in July and is expected to grow. Moreover, Greece is facing a crippling projected budget deficit of more than 12% of GDP and a debt in excess of 125% of GDP for 2010. As of December 2009, the Finance Ministry stated that the debt was a record €300 billion (U.S.$442 billion).