Greece grinds to a halt

Greece grinds to a halt

Workers strike as anger at austerity grows, govt unlikely to budge

Greece grinds to a halt

Paralysed:Greek public and private sector workers went on strike on Thursday, grounding flights, shutting schools and halting public transport in the second nationwide walkout in a fortnight in protest against austerity plans. AP

Under pressure from markets and European Union partners, the government unveiled a new austerity package last week worth 4.8 billion euros ($6.51 billion). It included a rise in value added tax (VAT), cuts in civil service incomes and a pension freeze.

Many Greeks see the plan as unfair and hitting the wrong people, in a country where corruption and tax evasion are widespread. Opinion polls showed increasing opposition to the taxes and cuts but the 24-hour strike was unlikely to halt government plans to slash spending and increase taxes to rein in a yawning deficit that has shaken the euro.

Asked about protests, Greek Prime Minister George Papandreou said in Washington on Wednesday: “Demonstrators have the right to demonstrate but the crisis is not this government’s fault.”

Hostility to the measures was growing. The private sector union GSEE and its public sector sister ADEDY, which together represent half of the country’s 5 million workforce, say the EU-backed austerity plan will hurt the poor and aggravate the recession-hit country’s economic problems.

“Workers will raise their fist and shout with one voice: We won’t pay for the crisis,” GSEE said in a statement. “No one, nothing is going to terrorise workers.”

The level of participation in the strike and protests will be watched closely outside Greece.
EU policymakers, rating agencies and financial markets welcomed the latest austerity package but want to see it implemented quickly and smoothly. For that to take place, public support was crucial.