Clashes Erupt Ahead of Greek Austerity Vote

June 29, 2011 - 5:44 AM

Greece Financial Crisis

Riot police stand near a tear gas canister during a demonstration in Athens Tuesday June 28, 2011. Greece's beleaguered government is bracing for a 48-hour general strike as lawmakers debate a new round of austerity reforms designed to win the country additional rescue loans needed avoid bankruptcy. (AP Photo/Dimitri Messinis)

ATHENS, Greece (AP) — Clashes have broken out between riot police and protesters outside the Greek Parliament where deputies are about to vote on a crucial austerity bill.

Riot police fired volleys of tear gas to push back protesters trying to overturn barriers, while the demonstrators pelted police with bottles and trash.

Greek deputies are set to back more austerity measures Wednesday as thousands of protesters vented their anger against a bill that has to be passed for the country to get crucial bailout funds and avoid a devastating default on its debts.

THIS IS A BREAKING NEWS UPDATE. AP's earlier story is below.

ATHENS, Greece (AP) — Greek deputies are set to back more austerity measures Wednesday as thousands of protesters vented their anger against a bill that has to be passed for the country to get crucial bailout funds and avoid a devastating default on its debts.

Outside parliament, protesters are blaming the politicians for a financial crisis that threatens to ripple far beyond Greece's borders — a Greek debt default could have huge repercussions in Europe's banking sector and stoke renewed turmoil in global markets.

The bill, which involves euro28 billion ($40 billion) worth of spending cuts and tax increases over five years, must be passed by Parliament if international creditors are to release the next euro12 billion ($17 billion) installment of the country's bailout fund. An additional bill that details how the austerity measures will be implemented must also be passed in a vote Thursday.

The proposals by the Greek government have sparked violent protests in Athens as well as a rebellion inside the governing Socialist Party. Prime Minister George Papandreou has struggled to convince his party's deputies to back the bill. He replaced his finance minister earlier this month to assuage the concerns of some lawmakers.

The Socialists hold a five-seat majority in the 300-member legislature.

Hours ahead of the vote, it looks like only one Socialist deputy will fail to heed Papandreou's call to back the measures, suggesting that the bill will get at least the 151 votes needed for it to pass. Hopes that the bill will pass have seen European stock markets start the day off strongly and the euro jump towards $1.44.

Alexandros Athanassiadis, many of whose constituents are employed by the Public Power Corporation which is up for privatization, said he maintains his opposition to the bill — but that he will likely be the only dissenter.

"I have not changed my opinion ... as things stand, I persist in my decision," he told The Associated Press. "I don't think (any other socialist) deputies will vote against. I will be the only one."

Athanassiadis said he opposes privatization of electricity and water companies, but supports the selling of several other state enterprises.

Wednesday's vote comes against a backdrop of violent demonstrations and on the second day of a nationwide general strike which has brought much of Greece to a standstill.

Protesters have vowed to encircle Parliament to prevent deputies from entering and voting for the bill. A massive security operation was under way to avert the blockade, with a large section of central Athens sealed off to traffic.

Scuffles broke out early in the morning as demonstrators attempted to block a major avenue leading to the center of the city, and to Parliament. Riot police responded with pepper spray, and 10 people were treated in a nearby hospital for minor injuries, hospital officials said.

Protesters converged on a car carrying communist lawmaker Liana Kanelli, but let it pass toward parliament because Kanelli said she would vote against the austerity package. However, someone in the agitated crowd threw yoghurt in her face. She wiped it away.

Demonstrators also hoisted ghoulish effigies of men they hold responsible for Greece's misfortune - Papandreou, new Finance Minister Evangelos Venizelos and Deputy Prime Minister Theodoros Pangalos — and shook them in the air on sticks.

"Dogs, you look after your masters," they chanted at police. The furious marchers also emptied bags of garbage from municipal containers and lobbed them at the security forces, who stood their ground impassively.

A day earlier, extensive clashes left at least 46 people injured, most of them police, as rioters pelted police with chunks of marble and ripped up paving stones, and authorities responded with repeated volleys of tear gas and stun grenades.

Greece has said it has funds only until mid-July, after which it will be unable to pay salaries and pensions, or service its debts, without the next bailout installment from the eurozone and the International Monetary Fund. The country is also in talks for additional help in the form of a second bailout, which the prime minister has said will be roughly the size of last year's euro110 billion ($157 billion) package.

"Voting these measures is required to maintain our credibility in the (bailout) process," Venizelos said during the debate Tuesday night. "Voting for these measures, regardless of any reservations, is an important, brave act of political responsibility."

But even prominent Socialists who say they will vote in favor are voicing objections.

"The austerity measures are not only harsh, not only unfair, but they are also ineffective," Socialist critic Vasso Papandreou, who is not related to the prime minister, told parliament late Tuesday. Still, she said she would grudgingly vote for the bill.

"Greece has many problems but the real problem is the eurozone," said Papandreou, a former EU commissioner. "Europe should be a zone of solidarity, but it is a jungle where the banks can do what they like."

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Menelaos Hadjicostis, Elena Becatoros and Thanassis Stavrakis contributed.