Greek Police, Protesters Clash Ahead of Austerity Vote

Posted October 20th, 2011 at 1:40 pm (UTC-5)
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Anti-austerity protests in Athens turned violent Thursday as the Greek parliament prepared to adopt a budget-cutting plan aimed at securing more bailout funds for the government to avoid a default.

At least 50,000 mostly peaceful, anti-austerity protesters gathered in Syntagma square outside parliament on the second day of a nationwide general strike that has idled a vast swath of Greek commerce and government services.

But the scene turned chaotic as some clashed with police, and violent protesters hurled fire bombs and stones at rival demonstrators. Protesters and masked youths armed with clubs fought each other as riot police fired tear gas volleys in an attempt to restore order. The government said one demonstrator died of a heart attack Thursday, while dozens of protesters have been injured in the last two days.

Parliament's Socialist majority appeared set to approve the hugely unpopular austerity plan to increase taxes and eventually eliminate 30,000 government jobs. Greece's international creditors have demanded passage of the austerity plan in exchange for release of an $11 billion segment of Greece's $159 billion bailout from last year.

The creditors — the International Monetary Fund, the European Union and the European Central Bank — say the money should be released to Greece as soon as possible. But a draft of their report also said the debt-ridden country's finances are “extremely worrying” and that its economic downturn is far worse than just a few months ago.

The creditors said that a second Greek bailout approved in July may not be big enough to save the country from bankruptcy.

EU leaders, scheduled to meet Sunday at a Brussels summit, are considering several measures to resolve the continent's debt contagion.

They could significantly boost the bloc's $596 billion bailout fund for debt-ridden governments, perhaps to as much as $2 trillion. They are also looking for ways to stabilize the bloc's banks even as they are forced to assume bigger losses on the Greek loans they hold.

French President Nicolas Sarkozy, German Chancellor Angela Merkel and other European leaders met in Frankfurt Wednesday ahead of the summit to discuss the various options.

Greece's economy is mired in the third year of a recession. The country's jobless rate hit 16.5 percent in July, just below the record set in May. But aside from assisting Greece, European leaders are worried about the spread of the debt crisis to other countries, especially Spain and Italy.