Samaras Tries to Keep Coalition Intact

Greek Prime Minister Antonis Samaras’ uneasy coalition showed another crack on Oct. 23 when Democratic Left head Fotis Kouvelis said he would not go along with radical changes in labor rights included in a $17.45 billion spending cut and tax hike plan.
PASOK Socialist leader Evangelos Venizelos continued to support the premier but said he, too had some serious reservations that could derail the package.
The three leaders, along with Finance Minister Yiannis Stournaras, met for two hours in another bid to close the gap in the 2013-14 budget plan they’ve been working on for weeks.
Stournaras has been negotiating with envoys from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) who are insisting on harsh new conditions, including drastic reductions in lump sums paid fired workers and less warning time before layoffs,  before agreeing to sign off on the plan.
Until the deal is done, the Troika is withholding a $38.8 billion loan installment and a second bailout, of $173 billion. “The unacceptable demands by the troika will not yield any fiscal benefit, they will only lead to further rise in unemployment,” Kouvelis said as he left the meeting.
Kouvelis, facing pressure in his party to back away from his support for austerity, said  that, “The Troika wants to level to the ground any labor rights that have remained.” He added that, “The recession will be aggravated; will give fodder to unemployment if these unacceptable demands of the Troika are accepted.”
Samaras warned that Greece is running out of time and cash and that there will not be any money left in the country’s coffers after Nov. 16 to pay workers and pensions unless the country gives in to the Troika’s demands and follows its orders. That has set off a series of strikes, protests and riots with another general strike called by the country’s two largest labor unions, representing public and private workers, on Nov. 14.
Samaras emerged and said a lot was at stake. “I am well aware of what is at stake for the country today,” he said. “We have already changed a lot of the troika’s initial suggestions, including those relating to the labor market. Negotiations are continuing. I do not even want to think about what could happen if I do not keep a steady hand on the wheel. I am looking ahead, asking for the broadest possible unity. Those of us who dare will save Greece.”
There were also objections to calls from the German Finance Ministry for Greece to put all its loan payments and tax revenues into a special account, with a limit on public spending and outside control. The Germans earlier had proposed a European official, presumably German, to be a de fact Finance Minister with control of the Greek budget. Earlier in the day, German Finance Minister Wolfgang Schaeuble referred to “mechanisms” and “automatic stabilizers” without being specific. “It will be politically difficult for Greece to accept,” he admitted.

Venizelos also resisted the Troika demands for labor market reforms, describing pressure from international creditors as “unjustified and provocative” and he slammed them for thinking they control the country. “We are not a protectorate. Our partners and the Troika have to keep this in mind,” he said.  “When we call upon the people to make extra sacrifices, these must yield results. This package must really be the last one,” he said.
But Venizelos, who has seen his party fall to 5.5 percent in a recent poll and is facing resistance from his members, said he would support the overall plan for more of the austerity measures that have put nearly two million people out of work and closed 68,000 business, while shrinking the economy by 7 percent. “We will do our national duty but this has to lead to results,” Venizelos said after the meeting. “It doesn’t help us to keep this a pending issue, it just increases the pressure on cash liquidity.” He added that, “We support the government.”
Venizelos said the package would be finalized in the next few days although the government has been saying that for weeks. “Only if the solution is complete will the markets believe it,” he added, that a solution is at hand. “We here in Greece, the Parliament and the people are called to answer very difficult dilemmas. “He argued that, “There is a margin for the measures to become analogous,” and said he asked Samaras to politically negotiate with the lenders himself.