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Greek Coalition Eyes More Pension, Wage Cuts to Close Gap

Greek Prime Minister Antonis Samaras (C) and his coalition partners, Democratic Left head Fotis Kouvelis (L) and PASOK Socialist chief Evangelos Venizelos are ready to lower the axe again on workers, pensioners and the poor

ATHENS – Days after Greek Prime Minister Antonis Samaras and his coalition partners said they would not again cut wages and pensions as part of a $14.16 billion savings plan to satisfy international lenders, they are reportedly ready to do so when they meet again on July 30 to finalize more austerity for weary Greeks.
Samaras, the New Democracy Conservative leader, PASOK Socialist leader Evangelos Venizelos and Democratic Left head Fotis Kouvelis had agreed where to cut or save some $12.32 billion previously – without revealing the details – but had hung up on the remaining $1.84 billion. Venizelos and Kouvelis had emphasized they would not go along with more pension and wage cuts but now have reportedly given in to the demands of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) Troika so that a second bailout package of $173 billion in loans can be released.
Without the monies, Greece will not be able to pay its workers and pensioners and has already stopped paying most of its bills. The country is surviving on a first round bailout of $152 billion in loans, but release of the last installment, of $38.8 billion, is being withheld until the government makes more cuts and institutes more reforms, such as privatization. Troika inspectors were in Athens last week to check Greece’s books and check on progress of the pay cuts, tax hikes and slashed pensions that came attached with the loans as well as to meet the coalition leaders.
Greek media reported that the country’s leaders are discussing possible layoffs of contractors in the public sector, a cap on pensions, cuts in welfare benefits, reductions in tax exemptions, and lower salaries for public employees as well as raising the retirement age by a year to make up for the shortfall in savings. It was not disclosed if the government will end universal health care and go ahead with a proposal to cap health care subsidies to $1,840 per year, a move critics said would make health care available only to the rich and let poor people die.
Not included on the list was going after tax evaders costing the country some $70 billion, while salaries of judges and military personnel are said to be exempt from cuts, although the government may require the Greek Orthodox Church to pay half the cost of salaries to priests, which are now borne by the state.
“The political leaders don’t disagree on anything, there are just alternative proposals being discussed to protect those with low pensions or incomes in the public sector,” Reuters reported, according to an unidentified source. The austerity measures have worsened a five-year recession, put nearly 1.1 million people out of work, shrunk the economy by 7 percent and is closing 1,000 businesses a week, but the Troika wants more so that international banks and lenders can be repaid first.
Sources told Reuters that even the harsh austerity has failed and Greece – which imposed 74 percent losses on private investors, locking itself out of the markets – will need the ECB to agree to at least 30 percent losses, which means that taxpayers in the other 16 Eurozone countries using the euro will have to pay for much of Greece’s debt, a step which is likely to spark outrage and political upheaval.
The GSEE labor union, which represents private sector workers, blasted the proposals before they were officially released. “We agreed on one thing – that we disagree on everything,” Yannis Panagopoulos, the head of the GSEE union, said in a statement. “The Troika men came to Greece as doctors and prescribed the medicine that would save the Greek economy and people, but in the end they proved to be charlatans.”

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