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Greek govt vows to pass cuts in "fight for existence"

Amidst social turmoil and calls for a 48-hour general strike, the Greek government is going through with the proposed austerity measures

Reuters, Friday 14 Oct 2011
Views: 1684
Views: 1684

Finance Minister Evangelos Venizelos pledged on Friday to pass sweeping austerity measures in parliament next week, declaring that Greece was in a "fight for our existence" and defying union opposition and rebels in the ruling Socialist party's own ranks.

After days of protests by groups ranging from taxi drivers to lawyers and cancer patients, much of Greece will be shut by a 48-hour general strike called to coincide with the vote, which could take place in two stages on Wednesday and Thursday.

Both of the main public and private sector union federations have backed the protest, which will close shops, factories and services in one of the biggest protests since the debt crisis began two years ago.

At least two deputies from the ruling PASOK party have threatened to vote against part of the package, which includes a mix of pay cuts, tax hikes and public sector layoffs as well as measures to open up the economy.

The government's slender majority is expected to hold up, with support from smaller opposition parties, however.

Venizelos, a burly political veteran drafted in by Prime Minister George Papandreou in June to head the austerity drive, said there was no alternative to the measures, which the government says are needed to fend off bankruptcy.

"This is a fight for our existence," he told parliament. "We will do anything."

Inspectors from the European Union, International Monetary Fund and European Central Bank left Athens on Tuesday indicating they would recommend releasing an 8 billion euro tranche of aid that Greece needs to keep paying its bills past mid-November.

But they warned that the country, deep in recession and choking on a public debt equivalent to some 162 per cent of gross domestic product, was slipping behind on its targets and needed to lift efforts to cut costs and reform its stricken economy.

Public anger at the measures has mounted, however, as Greeks have seen taxes go up, wages slashed and previously safe jobs in the public sector threatened with redundancy, in the most severe cuts in their postwar history.

Athens public transport services were shut down for a second day on Friday, the finance ministry was blocked by striking officials and about 1,000 taxi drivers marched on parliament, saying they fear for their livelihoods if the government eases regulations that effectively close access to many professions.

In a bid to prevent profiteering on motor fuel during a strike by customs officials which is holding up refinery deliveries, the government also put a cap on petrol prices, which have risen 50 per cent since an increase in duty last year.


Venizelos, who said he was working to build support for Greece among IMF members including rising economic powers like Russia, India and China, said the strikes could lead to public disorder. "We must urgently come to our senses," he warned.

He acknowledged the threat that reforms could be undone by workers who simly refuse to implement cuts that will hit them directly: "The general accounting office doesn't work because it's occupied. The general data system centre doesn't work because it's occupied," he said. "Society is turning on itself."

Papandreou's government has seen its approval ratings drop sharply and there have been growing signs of revolt within his own party. At least one member of parliament threatened to quit.

"I will resign on Monday. Let somebody else take my place," Thomas Robopoulos told a radio interviewer. "I can't be part of a parliament in which I have nothing to say."

Two other PASOK lawmakers said they would vote against a provision in the draft law which would suspend sector-wide wage deals in certain parts of the economy until 2014 to promote company-level agreements.

The government has only a narrow majority with 154 seats in the 300-member parliament. It would be able to replace any deputy who resigned with another member from its own ranks.
A small centre-right party has also said it may support the government in Thursday's vote.

Robopoulos, a car dealer and one of the few independent businessmen in the Greek parliament, has made several threats to resign in the past but has held back at the last minute to avoid triggering a government crisis.

However his comments underlined growing disillusion in the ruling party, which has seen its position in parliament eroded by a steady trickle of desertions over the past year.
Six lawmakers have shed PASOK party discipline to sit as independents in protest against austerity measures. Another two resigned their seats altogether and were replaced by the party.

The conservative opposition, which has repeatedly attacked the austerity measures as counterproductive, has called on the government to resign. Venizelos dismissed that: "I am sure this will steel the resolve of PASOK lawmakers," he told parliament. 

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