Greek Strike Shows Conflict Within Government Over Austerity

By NIKI KITSANTONISNOV. 12, 2015

The New York Times

ATHENS — Hundreds of thousands of Greeks walked off their jobs on Thursday to protest austerity economics, as officials of the leftist-led government wrangled with the country’s international creditors over the terms of Greece’s third bailout. At least one Athens protest turned violent.

The 24-hour walkout shut down public services, forced the cancellation of flights and disrupted public transportation across the country. Ferries remained moored in ports, hospitals were operating with reduced staff, and museums and archaeological sites were closed.

An estimated 20,000 people joined three demonstrations in Athens, one organized by the country’s two main labor unions, another by the Communist Party, and the third drawing students and leftists, according to a police spokesman.

Though the protests were mostly peaceful, a gathering near the Parliament building in the early afternoon turned into a clash between riot police officers and roughly 100 masked youths, who hurled stones and firebombs. The riot police responded with tear gas, as a police helicopter circled over the city center and crowds fled the acrid smoke..

A police spokesman said a few hours later that calm had been restored in the city, although several bank branches had been damaged.

General strikes have been common in Greece in recent years as the country has struggled with the privations of recession, high unemployment and the belt tightening the country’s foreign creditors have demanded. But Thursday’s general strike was the first under the Syriza-led government of Prime Minister Alexis Tsipras.

Mr. Tsipras came to power in January on a promise of ending years of austerity, but by summer he had agreed to an international bailout program of 86 billion euros, or $92 billion — the country’s third rescue package since 2010 — as the government was running out of money and Greece was on the brink of leaving the euro currency union. To secure the public’s reluctant support for the program, Mr. Tsipras called for new elections and was returned to power by a wide margin in September on a pledge to enforce the new bailout while easing its impact on poorer Greeks.

Though Mr. Tsipras succeeded in purging Syriza of radicals who had resisted a compromise with creditors during his initial term, divisions remain in his party over the issue. An indication of that deep rift was evident this week as Syriza’s labor policy department called for “mass participation” in Thursday’s strike and in the protest rallies planned for Athens and other major cities.

A government spokeswoman, Olga Gerovasili, on Thursday did not endorse Syriza’s support for the strike but said she understood why many Greeks were protesting. In a statement, she acknowledged that the government was “enforcing an agreement that includes measures we regard as unfair,” adding that “citizens have been hit, and they react.”

The country’s two main labor unions, which called the walkout, object to a recent barrage of economic overhauls, including further cuts to pensions and tax increases, and further budget-cutting measures that are in the works.

The General Confederation of Greek Workers, which represents private sector employees, accused the government of pursuing “policies of punishing austerity, poverty and wretchedness.” It also called for “the mother of all battles” against a new wave of austerity “that will further downgrade the living standards of Greek society.”

Social discontent has been growing as the government remains locked in talks with the country’s international creditors over the economic changes that must be enforced to unlock rescue loans. On Monday, eurozone finance ministers said that Greek authorities must do more before the creditors can disburse a €2 billion loan payout and release an additional €10 billion that has been earmarked in the bailout program for the recapitalization of Greece’s struggling banks.

The eurozone ministers gave Greece a week to bridge its differences with lenders on a series of contentious measures. A big sticking point is the level of protection that should be granted to Greek mortgage holders who have fallen behind on payments. Athens, fearing social turmoil, wants to ensure that thousands of Greeks do not lose their homes. But because nonperforming loans are one of the biggest problems undermining Greek banks, the creditors want to give the banks more flexibility on when they can foreclose on mortgages or declare business borrowers to be in default.

Other snags in the creditor negotiations include disagreement over a repayment program for Greek taxpayers who are in arrears; lenders want stricter criteria for eligibility. Another dispute involves how the government will make up for a budget shortfall after a public outcry forced it to abandon a planned value-added tax on private education.