Athens erupted into violence as traditional May Day festivities turned into a bitter protest against draconian austerity measures aimed at tackling Europe’s worst debt crisis in decades. For the tens of thousands of demonstrators who took to the streets in rallies that quickly descended into clashes with riot police, the show of force was just the beginning – a prelude of the storm that will rock Greece if its Socialist government “caves in” to the dictates of the IMF and enforces policies that have been likened to “the coming of Armageddon”.
To make the point, scores of stone-throwing youths chanted “people don’t bow down, it’s time again for revolution” as a petrol bomb set fire to a police officer in the heart of Athens.
“They say the only way of salvaging our economy is more austerity, but that’s a total lie,” said Nicolaos Danizis, a 60-year-old shipyard worker participating in a Communist-led demonstration outside parliament. “These latest measures have been cooked up by outsiders and are totally outrageous. They are aimed not at the rich but at the poor. What we are saying here today is that they will pass only over our dead bodies.”
Leftwing and anarchist demonstrators heckled and threw plastic water bottles at the former parliamentary speaker, Apostolos Kaklamanis, a governing Socialist MP, after spotting him on the sidelines of the Athens march. Kaklamanis, 73, was hit and kicked but suffered no serious injury and was whisked away by police. Mounting social unrest, worsening recession, strikes and spiralling debt will be the backdrop against which the ruling Pasok party will announce further belt-tightening measures today, agreed with European nations and the IMF as part of the biggest bailout in history.
The rescue plan, which will see an estimated €120bn (£104bn) injected into the near-bankrupt Greek economy over the next three years, comes at a heavy price: a stringent regime of structural reforms, cost-cutting policies and tax increases that will, it is hoped, modernise Greece and do away with its infamous state profligacy. The measures – which include reducing collective bargaining rights, abolition of the 13th and 14th monthly wages paid each year to supplement low public sector salaries, the slashing of bonuses and the overhaul of the pension and health systems – will wipe out almost every right won by workers over the past 30 years.
“Say goodbye to the old Greece,” lamented one Greek newspaper yesterday. “From now on everything is going to change.”
A leading political commentator, Takis Michas, voiced the same sentiment: “What is certain is that Greece is going to become a much poorer place; schools will be poorer, hospitals will be poorer, people will be poorer. We won’t have happy-go-lucky Zorbas dancing in the streets or on the top of tables. It’s over.”
For many, the intervention of the IMF, in the wake of three austerity packages already announced this year, has seen Greek humiliation mutate into unbridled bitterness and fury. “The IMF deals with injustice. It never targets the rich, who have deposits abroad and luxury cars and are buying properties in London. It always targets the poor,” said Maria Koumoundourou, a retired bank employee as she joined the marchers. “Its involvement in our affairs is truly offensive and very worrying. It has made us very angry.”
The prime minister, George Papandreou, called on the IMF and EU to activate emergency funds 10 days ago after it became apparent that Greece was heading for economic collapse; unable to refinance because of soaring borrowing costs racked up by merciless markets. The country has to find €8.5bn to fund maturing debt by 19 May.
The painful measures that came with the bailout were, Papandreou told Greeks on Friday, necessary for the nation’s survival.
In Greece’s hallowed culture of leftwing politics and workers’ rights, unions have been quick to react, announcing walkouts, including a general strike that will paralyse the country on Wednesday.
“These policies are totally unfair. They place all the burden on the have-nots to pay the price of this crisis and not the plutocracy,” said Yannis Papangopoulos who heads the Confederation of Greek Workers. “There will be a social explosion once they begin to bite.”
Amid the protests, the question that is inevitably being asked is: will Greece become ungovernable in the months ahead? While the EU is putting a brave face on the bailout, saying it will save Greece from insolvency and secure European financial stability, analysts fear the emergency aid will suffice only to stave off bankruptcy in the years ahead.
In Athens the belief is growing that, in the face of stiff resistance to reforms, the country will lurch from crisis to crisis until it eventually defaults and is forced to drop the euro and leave the 16-member eurozone. “Greece is heading for eventual default,” said Michas. “They can extend the period [with the aid], but I cannot possibly see how it can repay its debts when the economy is contracting.”
As concerns over the future grow, more and more Greeks are packing up their belongings and heading abroad. Applications to migrate to the US and Canada have reportedly increased by 30% since the beginning of the year. “What Greece needs is very decisive leadership to get out of this mess,” the former finance minister, Stefanos Manos, told the Observer.
“I am very worried about the future, but the country can also get back on its feet faster than people realise. The crisis has not diminished the value of the sun and sea, which is like gold or oil in other countries. Greece has lots of potential. It just has to use it properly.”