Riot police officers run away from fire as anti-austerity protesters throw petrol bombs during clashes in Athens. Photo / AP
Greece’s approval of austerity measures that were overwhelmingly
rejected by their citizens just days ago was a stunning defeat for
populist forces that have pushed for a break from years of grinding
Hours after police and demonstrators clashed in central
Athens, Greek MPs passed a bailout bill in a stark turnabout for the
Government. Party defections over austerity measures raise spectre of fresh Greek elections.
It was the price Greece’s lenders demanded for saving
the country from economic turmoil. Powerhouse economies led by Germany
have enforced austerity as the key to growth.
In the new
topsy-turvy reality, leftist Prime Minister Alexis Tsipras was tasked
with advocating a stricter version of the austerity he has long opposed.
In a sign of his new weakness, 40 of the 149 lawmakers from his Syriza
Party abandoned him, saying their nation was taking more of the same
toxic medicine that had forced it into five years of penury. The
defections threatened the stability of his rule, raising the spectre of
fresh elections and even more economic turmoil.
In the short term, the adoption of the new measures was a
milestone on the road toward European approval of an up to 85 billion
bailout, sparing Greece from surefire bankruptcy and its ouster from the
shared euro currency.
Already, banks have been closed for more than two weeks and Greece’s economy is slowly suffocating under the pressure.
“can understand the difference between those who fight with their soul
in battle and resist, and those who hand in their weapons and give up
with no resistance,” Tsipras told MPs in a speech capping the
contentious debate. “The outcome of these negotiations is of course not
what we wanted.”
The defectors included several members of
Tsipras’s Cabinet. Among the outcomes from the split could be the fall
of Tsipras’s Government and possible new elections. At a minimum,
Tsipras will be tasked with implementing unpopular measures with a
greatly weakened base of support. In the end, 229 of the 300 MPs
supported the bailout laws, but much of the support came from opposition
As MPs hurled insults at one another, anti-austerity
protesters and riot police traded petrol bombs and tear gas outside
Greece’s Parliament building, the worst such confrontation in years.
was powerful symbolism in the half-hour burst of violence, with Tsipras
and his partners – who not long ago were manning the barricades against
the authorities – now overseeing the crackdown on their anti-austerity
Yanis Varoufakis, who stepped down as Finance Minister last week, threw his lot with the dissenters.
can I possibly vote ‘Yes’ to monsters and the new Versailles Treaty?”
he said in reference to the peace accord that ended World War I and
imposed harsh terms on the losers.
Demonstrators in Athens were
angry the Government had not used the leverage gained from the
referendum on Europe’s bailout proposals to win more favourable terms.
“We voted ‘No’ in the referendum. But now it’s like we said ‘Yes’,” said Vassilis, a 33-year-old engineer.
thrown by furious anti-austerity protesters exploded in front of the
Parliament. Police fired tear gas to push back protesters who threw
rocks and stones as they chanted angrily in Syntagma square.
have been betrayed!” shouted a man in a balaclava, as police used pepper
spray and gas to stop a crowd breaching a security line blocking off
the road to the Prime Minister’s office.
Officers could be seen
dragging protesters away in handcuffs and police sources said about 40
people had been detained. Four policemen were injured by flying debris
and a television van parked nearby was set on fire, along with rubbish
skips and a Greek flag.
bailout package includes measures repudiated by voters in the
referendum. They include tax hikes, pension cuts and aggressive budget
• Germany’s Parliament must give its own endorsement tomorrow. Other eurozone countries will hold parliamentary votes.
European finance ministers need to figure out how to provide Greece
with emergency funding for the next several weeks while bailout details
• Most pressing is a Tuesday deadline for a €3.5 billion payment due to the European Central Bank.
Life just gets tougher for embattled Greeks
Anti-austerity protesters march in front of the parliament. Photo / AP
After the capitulation of Greece to its creditor nations in
Europe, Panagiotis Katsis, a retired accountant, did what he does best –
Under the harsh conditions of Greece’s 85 billion
bailout, social security will be cut. The 65-year-old calculates that
will shave 45 off his 950 a month pay.
Property taxes are also
set to rise, so he’s budgeting for a hit of about 700 a year. Add
creditors’ demands to raise national revenue through price increases on a
host of foods and he’s guessing 35 more on his monthly grocery bill.
thinks of Greece only as numbers,” said Katsis, who supports himself
and his wife on his pension. “Cut this. Cut that. We’ve had five years
of this already. We’ve had enough.”
For 11 million Greeks, lean
times are about to get leaner. As ordered by its creditors, Greece
passed a rash of reforms yesterday. As a result, the cost of life on
many Greek islands – which enjoyed sales tax discounts – is set to go
up. Many foods will be more expensive. Coffee bars will pay higher
taxes. Retirees will shell out more for medicines.
The Greeks are
used to austerity. They’ve lived it since 2010 when, to secure their
nation’s first bailout, budget-slashing measures led to across-the-board
cuts, including the firing of public servants and new taxes.
The pain piled on in 2012, when a second bailout brought even more austerity. Now, another dose is around the corner.
many Greeks are not so much outraged as disillusioned that Greece’s
creditors – led by Germany – would drive such a hard bargain.
Disillusioned with Greek Prime Minister Alexis Tsipras, the political
maverick from the far-left Syriza Party who vowed to just say no to
European demands but ended up saying yes.
Now, Tsipras has pushed
through Parliament some of the most difficult cuts the Greeks have
seen. Yet without the 85 billion bailout, it would have been worse.
Greek banks faced collapse and a messy exit from the euro currency could
have sparked a brutal currency devaluation. But that’s cold comfort for
This is a nation that, in some ways, is paying for
its sins: for years of high tax evasion; for public overspending and a
series of corrupt and inept governments. But after five long years, many
believe that they have paid enough.
Tsipras had given his first
major interview as head of his party at the Athens coffee shop of
Fratzeska Sklavou, 45, and her husband, Kosmas Thanasias, 52, in early
2008. They thought he would hold out at Monday’s eurozone summit.
of the austerity measures on the table was a higher tax for Greek
coffee shops that was going to cost their business 1000 a month.
The next morning, they awoke to discover that Tsipras had caved. “We didn’t blame him,” Sklavou said. “They gave him no choice.”
The new tax on coffee shops will hit them when their business is already down 50 per cent.
have three choices,” Thanasias said. “Cut our profits, which are
already shrinking; increase prices and drive away our clients; or cut
staff. We’re going to go with option one.”
For retirees like Katsis, the new round of austerity means another choice. What to cut now?
a 20 per cent austerity cut to his pension in August 2012, he gave up
his hobby – brewing homemade wine – because he couldn’t afford the
grapes and bottles anymore. With another hit coming, “there’s not much
left to cut”, he said.
Katsis also voted “No” in the referendum.
But like so many others who did, he doesn’t want cuts – but he also
doesn’t want to leave the euro. European leaders say Greeks can’t have
it both ways. Although some have blamed Angela Merkel, Katsis doesn’t.
“She is fighting for her country,” he said. “I only wish we had someone in Greece who would fight as hard for us.”