Strike test for new Greek government

[December 01, 2011]  ATHENS, Greece (AP) -- Thousands of protesters bitterly opposed to government austerity measures marched through the Greek capital Thursday, as another general strike closed schools and public services, left hospitals functioning on reduced staff and confined ferries to port.

The 24-hour strike is the first test of union opposition to Prime Minister Lucas Papademos' three-week-old coalition government and comes a day after it promised rescue creditors it will impose additional "deep and broad reforms."

Police said up to 15,000 members of a Communist-backed union marched peacefully through central Athens.

Shouting "No more poverty, no more burdens, time for a new society," they paraded past Parliament, followed by a separate group of some 4,500 demonstrators from the country's two biggest labor unions and left-wing parties.

Another 6,500 people took part in two separate demonstrations in the northern city of Thessaloniki.

Greeks are heartily sick of austerity measures -- pension and pay cuts, increases in taxes and retirement ages -- imposed on them in return for bailout cash from fellow eurozone countries and the International Monetary Fund. More cutbacks lie in store as the country heads for a fourth year of recession among record unemployment.

"Unfortunately people are in a state somewhere between poverty and despair," Ilias Iliopoulos, deputy leader of the civil servants' union ADEDY told AP Television News.

Papademos has written to leaders of the European Union, European Central Bank and IMF, promising to conclude a massive new bailout deal for Greece and impose tough cost-cutting measures needed to stop the country overspending.

"The government is determined to continue the process of fiscal consolidation and structural reform in order to secure sound public finances and improve the country's international competitiveness," he wrote in a letter dated Tuesday and made public late Wednesday.

Backed by the country's main Socialist and conservative parties, Papademos now heads negotiations for the new debt deal, amid an escalating crisis in the eurozone that is threatening its largest economies and ultimately the single currency's existence.

The new deal for Greece, to receive euro130 billion ($174 billion) in more rescue loans and support for banks, also includes a voluntary write-down of debt held by private holders of Greek bonds.

On Tuesday, eurozone countries approved the release of a crucial rescue loan installment to Greece that will total euro8 billion ($10.73 billion) along with a portion covered by the IMF.

In return for the EU-IMF lifeline, new austerity measures impose job suspensions and pay cuts in the public sector and an emergency property tax that threatens to leave households without power if they delay payment.

"They are creating a situation that can no longer be tolerated, can no longer be endured. Unfortunately people are in a state somewhere between poverty and despair," ADEDY's Iliopoulos said.

"The measures are supposed to improve the country's financial situation, but the country is getting deeper into debt, unemployment is rising, and the recession -- unprecedented in recent times -- is worse than anywhere else in Europe," he said. "People are falling apart."

The new coalition government, formed midway through the Socialists' four-year term in office, is due to call early elections in late February.

[Associated Press; By NICHOLAS PAPHITIS]

Elena Becatoros, Derek Gatopoulos and Theodora Tongas in Athens, and Costas Kantouris in Thessaloniki contributed.

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