ce399 | research archive: (anti)fascism

Greek Parliament Passes Austerity Measures (NY Times 7/5/10)

Posted in Uncategorized by ce399 on 18/06/2010

Dimitar Dilkoff/Agence France-Presse

Police officers used tear gas to disperse protesters and contain violence in Athens on Thursday.

The Greek Parliament passed a package of tough austerity measures on Thursday, trying to stave off economic collapse and help prevent debt contagion from spreading.

The vote, taken one day before leaders of the 16-member euro zone meet in Brussels to discuss final details of a rescue package for Greece, was seen as crucial in helping the country secure the aid.

But with protesters gathering outside Parliament’s doors, the measure’s passage stirred immediate concerns about a long summer of social unrest that could undermine the government’s resolve, push the already devastated Greek economy into deeper recession and put the $140 billion rescue package in jeopardy.

For the most part, the mood outside Parliament hovered in an uneasy calm as demonstrators denounced the newly approved spending cuts and taxes. But with thousands of demonstrators, many of them public sector employees, facing a line of riot police officers, tensions were rising one day after protests that left three people dead.

The deaths polarized Greece, where demonstrations have long been a way of life and played a pivotal role in the overthrow of the military regime in 1974. In December 2008, thousands of rioters clashed with security forces for weeks over the fatal shooting by the police of a 15-year-old boy.

Clashes broke out toward the end of Thursday’s protests as clutches of black-clad youths hurled bottles, oranges and stones as they tried to storm Parliament. The violence was quickly contained when the riot police fired tear gas at the protesters, who dispersed.

The demonstrators banged drums and held placards saying “Our government is a butcher” and “Get out I.M.F., get out E.U.” Outside the Marfin Egnatia Bank, where three people died Wednesday after hooded youths hurled a firebomb at the bank, mourners built a shrine of candles and flowers. The letter “A” surrounded by a circle was painted on the door of the bank, the signature of a fringe anarchist group that the police say is behind the violence.

“We have done what was necessary, not what was easy,” the finance minister, George Papaconstantinou, said after the vote. “Without these measures, we’d be thrown into the deepest recession this country has ever known.”

Parliament voted 172-121 for the measures, worth about $38 billion through 2012. They include public sector pay cuts, higher taxes on alcohol and cigarettes and tighter retirement rules.

Opposition parties railed against the measures, which many Greeks complain are too draconian and will only set off a recession that will compound the debt problem. “The dose of the medicine you are administering is in danger of killing the patient,” said Antonis Samaras, the conservative opposition leader.

As tempers continued to flare in Greece, concerns were growing that the financial contagion could spread to the indebted countries of Europe’s southern tier and undermine a global recovery. In New York, the Dow Jones industrial average plunged almost 1,000 points before rebounding to recover two-thirds of its losses and close at 10,520, down by 348

In Germany, Chancellor Angela Merkel sought to shore up support for the European Union’s rescue package for Greece before a critical parliamentary vote on Friday on Berlin’s share, which is expected to be about $30 billion.

Mrs. Merkel, who faces an election on Sunday in Germany’s most populous state, was among the most vociferous critics of a bailout package for Greece. But in recent days, in a recognition of the vulnerability of German banks and the potential for the crisis to spread, she has appealed for European unity to support the debt-ridden country and restore the euro zone’s credibility.

Mrs. Merkel’s efforts to build support for the rescue package in the German Parliament were sharply criticized by the opposition Social Democrats. But Mrs. Merkel’s governing coalition has a majority in both houses of Parliament, and she said Thursday that she aimed to pass the bill before heading to the euro zone meeting in Brussels on Friday on the rescue package for Greece.

The president of the European Commission, José Manuel Barroso, said Thursday that he was confident that all the euro zone countries would rally behind Greece. “I hope so,” he said, because by helping Greece, “we are helping ourselves.”

In Greece, analysts said the smaller scale of Thursday’s protests, which were much more subdued than the previous day’s, reflected a backlash among Greeks against Wednesday’s deadly violence. Yiannis Stournaras, a leading economist and former adviser to the governing Socialist Party, said the deaths had strengthened the government’s resolve.

“These people, these anarchists, who threw the petrol bombs, have done themselves great damage. Greece will move forward, and I don’t expect the government to back down at all,” he said.

Conspiracy theories about the causes of the deaths abounded Thursday, with many protesters making unsubstantiated claims that Wednesday’s attack had been orchestrated by the government and the police as a pretext to pass the austerity measures.

For all the angry words, many Greeks said they expected that as summer began and people went on vacation the protests would subside, at least until fall, when the austerity measures began to hit peoples’ pocketbooks.

“The worst is yet to come. It will be like a volcano erupting,” said Maria Chira, a teacher protesting in front of Parliament on Thursday. “Someone needs to pay for this mess.”

Asked who should pay, many Greeks recited a litany of culprits, including their own politicians, Germany, the European Union, Goldman Sachs, President Obama and the International Monetary Fund.

But in a sign of the challenges ahead, few were willing to take responsibility for the profligacy of a country where tax evasion is rampant and a spending spree by successive governments has led to nearly $400 billion in debt.

http://www.nytimes.com/2010/05/07/world/europe/07greece.html?pagewanted=print

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