New Troika Demands: Firings, Pay Cuts, Slashed Health and Defense Spending

ATHENS – There just seems to be no good news for Greeks these days. Even as a coalition government led by former European Central Bank (ECB) Vice-President Lucas Papademos has stalled in talks to get a second bailout to keep the country from falling into bankruptcy, the Troika of international lenders is demanding more of the same austerity measures that have created a deep recession of 18.2 percent unemployment and the closing of more than 100,000 businesses.
Papademos told the ministers of his temporary government, comprised of holdover ministers from the former ruling PASOK Socialists, their bitter rival conservative New Democracy and the far Right-Wing LAOS party, that the European Union-International Monetary Fund-ECB said no more money will be coming for Greece unless it implements more Draconian measures. Greece is surviving on a first series of $152 billion in rescue loans which have failed to slow the country’s slide toward what most analysts said is imminent default. Papademos is wrangling for a second package of $169 billion and hopes for a write-off of as much as 70 percent of Greece’s debt, but those talks too have stalled and gone nowhere for weeks.
The newspaper Kathimerini reported that Papademos distributed among his ministers a 10-page document that contained the demands being made by Greece’s lenders, that include insistence that the government fulfill prior requirements that failed under former Prime Minister George Papandreou, who resigned on Nov. 11, 2011 after 18 months of protests, riots and strikes against the austerity measures. Greece had accumulated a $460 billion debt caused by generations of needless hires in return for votes for alternate New Democracy and PASOK Administrations.
But the new measures for the continued bailouts are as stinging as the first:

• The firing of 150,000 public workers by 2015
• No exceptions to the across-the-board pay structure for civil servants
• Cuts in defense and health spending
• The closure of state bodies
• Cuts in auxiliary pensions which are the last lifeline for many elderly
• The merging of pension funds into a single entity
• An increase of 25 percent in property values although Greece has already doubled that assessment
• An additional 2.2 billion euros in spending cuts this year
• Quicker privatization of state enterprises and the sale or leasing of state-owned properties
• Cancelling favorable terms for taxpayers who have made payment arrangements
• Reduction of social security contributions by 5 percent

There was no mention of a reduction in private sector wages, although the Troika said that salaries should become more flexible. Papademos is due to put the measures in front of the leaders of the three parties in his coalition government when he meets them on Jan. 28 before finalizing the plan with his Cabinet the next day, and then present them at an EU meeting in Brussels on Jan. 30. The Troika has insisted on unanimous support from all members of the coalition, putting New Democracy leader Antonis Samaras in a difficult position as he said he supports the government but not all the policies. But without his approval, the Troika said it will shut off the rescue loans. Papademos is struggling to keep the coalition together in the face of growing public disapproval of his government too.