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Tsipras Woos Partners But Says No Bailout Deal

ATHENS – Greece’s new power broker, SYRIZA party leader Alexis Tsipras, is trying to form a coalition government in the wake of the country’s fractured election results, but has laid down tough conditions that would require a rejection of the deals that provided the country with a first rescue package of $152 billion in emergency loans from international lenders and a coming second bailout of $173 billion more.
Those came with attached austerity measures that have infuriated Greeks and set off two years of protests, strikes and riots and led voters to abandon the traditional ruling parties who supported the pay cuts, tax hikes, and slashed pensions – New Democracy Conservatives and PASOK Socialists.
Tsipras said he wouldn’t deal with them unless they take back their signatures and renege on their deals with the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) and warned he would nationalize Greek banks. Unable to form a coalition, New Democracy leader Antonis Samaras, whose party finished first in the elections but with barely 19 percent, handed the baton to Tsipras, the former Communist Youth party leader whose Coalition of the Radical Left party finished second. He has until May 11 to try to form a government or the chore goes to the third-place finisher, the discredited Socialists of new leader Evangelos Venizelos, who was finance minister in the current shaky hybrid government his party shared with New Democracy.
Tsipras laid out five points with which any prospective partner would have to agree, although he has few choices. Seven parties won seats in the Parliament, but he has rejected working with Samaras or the neo-Nazis of the Golden Dawn party who finished sixth, and his offer of the Prime Minister’s position to Communist leader Aleka Papariga if she joined the coalition was rejected. That leaves him with trying to convince the surprise fourth-place finishers, the new Independent Greeks party of New Democracy outcast Panos Kammenos, whose group is made up heavily of Conservatives and ex-military and ex-police who are also against the bailout but whose other positions are antithetical to those of SYRIZA and the Left. The seventh-place Democratic Left, led by Fotis Kouvelis, is more amenable to talking.
Following a meeting with President Karolos Papoulias, who delivered the mandate to Tsipras, the 37-year-old politician said that, “This is a historic moment for the left and a great challenge for me.” Addressing the press from Parliament later and before embarking on a string of meetings with party and union leaders, Tsipras rejected the efforts of New Democracy and PASOK for a so-called “national salvation government,” saying that a coalition of conservative and centrist forces would be a government “for the salvation of the memorandum,” – the bailout terms – “and would violate the mandate of the people, who have, rejected the bailout agreement with their vote.”
Tsipras challenged the two parties, who have ruled Greece for the past three decades but suffered a crushing defeat at the May 6 polls, to rescind their letters of guarantee to creditors saying that Greece would abide in full to the terms of the bailout deal, “if they truly regret what they have done to the Greek people.”
He said his five points include:

  • The immediate cancellation of all impending measures that would impoverish Greeks further, such as cuts to pensions and salaries.
  • The immediate cancellation of all impending measures that undermine fundamental workers’ rights, such as the abolition of collective labor agreements.
  • The immediate abolition of a law granting MPs immunity from prosecution, reform of the electoral law and a general overhaul of the political system.
  • An investigation into Greek banks, and the immediate publication of the audit performed on the Greek banking sector by BlackRock.
  • The setting up of an international auditing committee to investigate the causes of Greece’s public deficit, with a moratorium on all debt servicing until the findings of the audit are published.

“We are not indifferent to whether the country will be governed or not, but we are primarily concerned with the direction in which the country will be governed and whether the people’s mandate will be respected,” Tsipras said. He said he would also talk with the leaders of parties who failed to win seats, including the Ecologist Greeks and Social Pact, and would not talk with PASOK or New Democracy unless they renege on the bailout deals, which would amount to a final humiliation of the traditional rulers who imposed austerity on Greek workers, pensioners and the poor.
The Troika has warned, however, that any attempt by a new government to change the terms of reforms or renege would lead to the second bailout being cancelled, leaving Greece without any money to pay workers, pensioners and the poor and leaving the country broke and with nowhere to turn to borrow money. When he was finance minister, Venizelos imposed a 74 percent loss on investors, leaving Greece totally dependent on public aid from the Troika and locking Greece out of the markets.
“He has asked Venizelos and Samaras to send letters to EU and IMF partners taking back previous written pledges as a condition for cooperating,” Nikos Papas, head of Tsipras΄ political office, told Reuters. His uncompromising stance may lower already slim chances of forming a coalition by scaring off the former ruling parties New Democracy and socialist PASOK, while further unsettling jittery investors, Reuters said. “The popular verdict clearly renders the bailout deal invalid,” he told reporters.
An official from his party said Tsipras had demanded that the two former ruling parties withdraw pledges given in exchange for the bailout as a condition for joining his government. A coalition alliance with these two parties had looked like the only way Tsipras could form a government. But they are unlikely to accept the condition, making repeat elections in a few weeks even more likely.

(Sources: Kathimerini, Reuters, Capital)

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