Wednesday, June 22, 2011

Greek Vote Sets Stage for More Cuts

Wall Street Journal
June 22, 2011

Greece's prime minister survived a crucial confidence vote in Parliament, rallying his Socialist deputies and solidifying support for a package of tough budget cuts that European authorities have demanded as a prerequisite for more aid to the ailing country.

Prime Minister George Papandreou, reeling from political pushback against those cuts, took a gamble by calling for the vote. To assuage some of the anger, he shuffled his cabinet last week and sidelined the finance minister identified with the measures.

In a roll call, Mr. Papandreou's government won 155 votes in the 300-seat parliament. Mr. Papandreou asked deputies for their support so that the government could "continue the national struggle for the salvation and change of our country."

The vote makes it likelier that the Greek parliament will pass the budget cuts—some €28 billion ($40 billion) worth—by the end of the month. European Union officials have said that Greece must do so if it is to get further aid.

"The vote of confidence sends a very strong message that the government is united," said Anthony Livanios, an independent political analyst. "This is definitely a victory for Papandreou."

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