Greek Government, Economy In Turmoil

Greek Prime Minister Papandreou says he will reshuffle his Cabinet and seek a vote of confidence for his new government, after attempts to form a coalition government failed. There were also riots against the country's austerity policy. Political analyst John Psaropoulos talks to Steve Inskeep about the situation in Greece.

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RENEE MONTAGNE, host:

This is MORNING EDITION from NPR. I'm Renee Montagne.

STEVE INSKEEP, host:

And I'm Steve Inskeep.

Greece is in deep financial trouble and in political trouble. In Athens, demonstrators gathered again today outside parliament. You may recall yesterday that there were riots by protesters who opposed more austerity programs and the prime minister said he would reshuffle his cabinet and seek a vote of confidence for his new government. He's trying to survive politically.

We're going to talk about all this with John Psaropoulos, a political analyst in Athens. Welcome to the program.

Mr. JOHN PSAROPOULOS (Political Analyst): Hello, and thank you.

INSKEEP: How serious were the riots yesterday?

Mr. PSAROPOULOS: The riots yesterday were quite serious, although the people responsible for the violent protests are a relative minority. The vast majority of people who had gathered on the central square in front of parliament yesterday were peaceful protestors from different generations and different walks of life, and they were the people who made yesterday's event important. They're the ones who are the - the grassroots campaign that has spontaneously risen over the last three weeks and has encamped in front of parliament and occasionally swells to very large numbers.

INSKEEP: But there were some more violent people around the edges.

Mr. PSAROPOULOS: Well, it's a constant question in Greece, where the violent protestors come from. The curiosity here is that none of them are ever arrested, and the Greek media like to theorize that these people are put there by the police in order to create the violence and bring on the police crackdown and tear gas, but that's never been proven.

INSKEEP: And the prime minister said in response that he would reshuffle his Cabinet. Is that going to be enough to quiet the protests?

Mr. PSAROPOULOS: That's not the only thing that triggered the reshuffle. The fact is that there was a state of mutiny within the Socialist Party. The prime minister needs his 156 deputies in the 300-seat parliament to pass his austerity measures. Two of those 156 had openly defected, and there were rumors that more of them were likely or were in the process of doing so. That would mean that if the prime minister felt he was, in fact, close to falling below the 151 vote threshold, he would fail to pass the bill in parliament, and that might very well have triggered the collapse of the government anyway.

INSKEEP: Is it still going to be possible for him to keep his job then?

Mr. PSAROPOULOS: He says that he offered to give up his job in the negotiations with the main opposition conservative New Democracy Party and that this offer was belabored with conditions that were simply unacceptable, because they placed too much of an economic burden on Greece.

In other words, the prime minister presented himself as being the person who is willing to do what it takes to get Greece through the stages of austerity and reform to keep claiming the IMF/European Union money, and the opposition as the people who are being populist and are refusing to allow this process to go forward.

INSKEEP: So you've got a prime minister who is within a couple of votes, a handful of votes of losing his majority in the parliament. He's struggling to hang on. Is he likely to hang on?

Mr. PSAROPOULOS: He's likely to hang on, at least while the fifth tranche of the bailout loan lasts, which the European local authorities announced yesterday will be dispersed, and the IMF has waived its objections as well. So that's 12 billion euros that will pay in next week and will carry Greece forward for another couple of months. But that's a very brief period to forecast for. The important thing is that this government is going to have to face a day of reckoning when it again brings austerity measures for a vote to parliament.

INSKEEP: John Psaropoulos in Athens. Thanks very much.

Mr. PSAROPOULOS: My pleasure.

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