Calamos Supports Greece
GreekReporter.comGreek NewsEconomyEU Says It’s Not Ready to Help Greece Yet

EU Says It’s Not Ready to Help Greece Yet

Parts of Athens burned in arson fires while politicians debated the country's future and adopted more austerity measures

ATHENS – Despite new austerity measures rammed through the Parliament in the wake of riots that left parts of downtown Athens burning, European Union leaders said they aren’t convinced that Greece is serious about reform and won’t release a second bailout yet of $169 billion to keep the country from going bankrupt. Greece’s coalition government had pressured lawmakers to approve a package that included up to 32 percent reductions in the minimum wage and the layoffs of 150,000 workers to show international lenders the country was serious about restructuring its bankrupt economy.
It’s not enough, said skeptical leaders of the Eurozone, the 17 countries that use the euro as a currency. European Finance Commissioner Olli Rehn said Greece still has to prove it can make another $430 million in cuts in this year’s budget to spare pensions from further axing. Although Greeks have had to endure two years of pay cuts, waves of tax hikes, and slashed pensions to get a first bailout of $152 billion to keep the economy from going under.
While many Greek lawmakers complained the country is being humiliated daily by the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) as a condition of getting rescue loans, the Parliament followed the lead of interim Prime Minister Lucas Papademos, a former ECB Vice-President, who said the country had to agree to more austerity or face chaos and collapse and shortages of food, fuel, medicine and other necessities. About 100,000 Greeks protested while his coalition government rubber-stamped the deal despite the defections of 45 members of the former ruling PASOK Socialists and their bitter rival New Democracy conservatives.
The Troika said unless the package was approved, no more money would be released, and Greece would be unable to pay workers and pensioners as well as an $18.2 billion installment on March 20, or a 70 percent write down in its debt as part of a so-called Private Sector Involvement (PSI) with creditors. Eurozone ministers are scheduled to meet in Brussels on Feb. 15 to decide whether Greece has gone far enough, although many Greeks fear yet more austerity measures on the horizon, even though the continued cuts have created a near-depression of 20.9 percent unemployment and led to the closing of more than 111,000 businesses, leaving many Greeks destitute, homeless and suicidal while the country’s rich elite and tax evaders continue to escape with near-impunity.
French Socialist politician Segolene Royal, the defeated Presidential candidate in 2007, voiced outrage at the way austerity was targeting the poorest Greeks while the rich were still able to evade taxes with impunity. Accusing European leaders of “cowardice,” she singled out European Commission President Jose Manuel Barroso for criticism. “Athens is burning … Where is Mr. Barroso? – the ultra-liberal politician chosen to head the Commission – that was a very grave error. Where is the Council of Ministers? What is the European parliament doing?” Royal asked in a radio interview.
Rehn said the Greek Parliament vote was a “crucial step” but that EU leaders won’t make a decision until March 1, although Finance Minister Evangelos Venizelos, in an effort to persuade rebelling lawmakers to support the program, said the EU told him it needed act by Feb. 15 or there wouldn’t be enough time to make arrangements to pay the March 20 loan nor reach agreement to write down the debt, a move that could save Greece $132 billion. He also said that Papademos, Socialist leader George Papandreou, who resigned on Nov. 11, 2011 in the wake of two years of protests, riots and strikes, and New Democracy leader Antonis Samaras have to give their commitment in writing and support the program even after new elections are held. Samaras said he opposes the austerity measures he supported previously and refused to sign any deals with the EU or Troika. He said the deal he urged his party to support should be renegotiated, which could be a deal breaker and return Greece to the bargaining table or to face default again.
“We expect to receive clear assurances from political party leaders before they embark on the political campaign for the next election,” said Rehn’s spokesman, Amadeu Altafaj Tardio. A government minister from a Eurozone country sympathetic to Greece’s plight complained that the Eurozone was constantly shifting the goal posts in its dealings with Athens. Officials in Germany, which is footing the biggest share of the rescue package, said they aren’t convinced and complained they don’t want to keep throwing money into Greece, which they characterized as a “bottomless pit.” Economy Minister Philipp Roeslser said, “Now we need to wait and see what comes after the legislation,” demanding action instead of announcements as EU leaders have complained they can’t trust Greece and no longer believe its political leaders.
Greek workers and union leaders said there will be a revolution unless the austerity stops. “The people yesterday sent a message: Enough is enough! They can’t take it anymore,” said Ilias Iliopoulos, General Secretary of public sector union ADEDY. Critics said more austerity would only condemn the economy to an ever-deepening downward spiral, but Greek political leaders have offered few alternatives, with Samaras offering only a vague program of growth he didn’t detail.  “Yesterday’s vote in the Parliament may have saved the country temporarily from default, but the Greek economy is going bankrupt and the country’s political system is failing,” the head of the Greek Commerce Confederation, Vassilis Korkidis, said. While the rioters were mostly anarchists, there is a groundswell of rage among working-class Greeks who say their standard-of-living has collapsed and they can’t even afford basic necessities anymore as the government has hit them with punishing tax hikes and wage cuts.
(Sources: Kathimerini, AP, Bloomberg, Reuters)

See all the latest news from Greece and the world at Contact our newsroom to report an update or send your story, photos and videos. Follow GR on Google News and subscribe here to our daily email!

Related Posts