Dissent grows ahead of Greek confidence vote
ATHENS, Greece (AP) — Greece's ruling Socialists were in open revolt against their own prime minister ahead of a confidence vote Friday, in a political free-for-all over a new European plan to keep the deeply indebted country afloat.
A week of unending drama in Athens has horrified its European partners, spooked global markets and overshadowed the Group of 20 summit in the French resort of Cannes. The threat of a Greek default or exit from the common euro currency has worsened the continent's debt crisis, which is already struggling under massive bailouts for Greece, Ireland and Portugal.
Prime Minister George Papandreou on Thursday was forced to abandon his plan to hold a referendum on the debt deal, after markets and EU leaders reacted with hostility to the idea. The U-turn left Papandreou's two-year-old government teetering.
"(Papandreou) fought for a long time to restore the credibility of the country, and finished by destroying his own credibility," political analyst George Sefertzis told the AP.
At least eight Socialist deputies refused to say whether they would back the embattled Papandreou, who has a majority of just two seats in parliament. Many piled the pressure on him to hold immediate talks to form a national unity government — signaling that he may have to soon step aside even if he wins Friday's midnight vote.
One senior government lawmaker told The Associated Press he would vote against Papandreou unless he first promised to resign over the weekend and start talks on a caretaker government. The lawmaker spoke on condition of anonymity, city ongoing party negotiations.
A growing number of Socialists were seeking a transition government — possibly joined by opposition lawmakers and respected non-politicians — to last for several months and stabilize Greece's finances before the country held early elections.
The main opposition conservatives, however, were demanding a quick early election before the end of the year — something the Socialists were rejecting.
"At this moment, elections must be avoided ... because the most important thing is that we avoid a disorderly default," said Socialist lawmaker Thanassis Papageorgiou.
Papandreou has given no indication that he plans to resign shortly, although he said Thursday he was not "glued to his seat."
The new debt deal would give Greece a euro130 billion ($179 billion) rescue package — on top of the euro110 billion ($152 billion) it was granted a year ago. It would also see banks write off 50 percent of the money Greece owes them, some euro100 billion ($138 billion). The goal is to reduce Greece's debts to the point where the country is able to handle its finances without relying on constant bailouts.
If the deal stalls, Greece will not get the next euro8 billion ($11 billion) installment of its loans and will probably go bankrupt before Christmas.
Polls indicate the Greek public is close to the breaking point after more than 20 months of harsh austerity cuts and tax hikes. Near-daily strikes and protests have often degenerated into riots. Recent opinion surveys show 90 percent of Greeks oppose Papandreou's policies and his party has just 20 percent public support.
Outside parliament, an estimated 7,000 protesters held an anti-government rally Friday.
The Socialists have mostly shouldered the blame alone for their austerity measures, but the conservatives also have culpability in the financial debacle. The Socialists came to power in a 2009 landslide and immediately discovered that, under the ousted conservatives, Greece had falsified some of its financial data for years.
Associated Press writers Elena Becatoros and Derek Gatopoulos in Athens contributed.