Greeks Take to the Streets Against More Cuts

by Joanna Kakissis

Time
October 5, 2011

The Greek government is facing powerful public resistance to new austerity measures that foreign lenders are demanding in return for bailout loans. The country's main labor unions, ADEDY and GSEE, which represent 2.5 million workers, say they expect thousands to march to parliament on Wednesday to protest cuts in the public sector and a new property tax which will be collected through electricity bills.

The first general strike since June has grounded most international flights, halted trains and closed tax offices and some state schools. Hospitals are running on emergency staff. At the same time, inspectors from the European Union and International Monetary Fund continue their evaluation of Greece's finances to determine whether the country should receive $11 billion, the latest installment of a $150 billion bailout loan package, by next month. The Greek government said Tuesday it has enough cash to pay its bills only through November.

Finance Minister Evangelos Venizelos said Tuesday that Greeks must back the new measures if the country has any hope of meeting its deficit target for 2011, which was revised to 8.5% of gross domestic product from 7.6%. Along with tax hikes, budget cuts and the long-overdue reforming of the country's bloated public sector, the Greek government must also privatize some state assets and crack down on longtime tax evasion.

But winning public support for more austerity seems virtually impossible right now. Polls show that nearly all Greeks oppose more cuts and most believe the measures have done little to get Greece out of debt. More than a year of tax hikes and wage and pension cuts have decimated the middle class. Unemployment is at more than 16%. Personal bankruptcies, homelessness, suicides and crime are all on the rise. And yet the Greek government missed its deficit targets this year. Euro-zone finance ministers have decided to delay the latest loan payment, which Greece needs to stay solvent, because they don't think the country is trying hard enough to reform itself. More austerity, they say.

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