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article imageGreek protests surge as parliament votes on latest austerity plan

By Garry Malloy     Jun 29, 2011 in World
Athens - The Greek economy is at a virtual standstill as protesters are joined by public and private union strikers taking part in a two day general strike which began early Tuesday morning. Today the Greek austerity bill passed.
The groups are opposed to the latest set of austerity measures the Greek government agreed upon to qualify for its next bailout installment from the European Union (EU) and International Monetary Fund (IMF). The Greek parliament will vote on the redesigned five year austerity plan over the next two days.
Today's vote was important to pass the initial austerity bill. A second vote on Thursday, the Globe & Mail reports, would approve the implementing legislation for the austerity program, and is necessary "to allow a loan agreement between Athens and the EU and IMF to be negotiated."
The plan calls for public spending cuts of 14.3 billion euros ($20.5 billion) and tax increases of 14.1 billion euros over five years. Full details of the austerity plan can be found here.
Many Greeks insist they should not be forced to pay for a crisis they believe only the politicians are responsible for, according to The Globe and Mail.
“It's not our crisis... Those who created it are the ones who should pay up,” Said Gsee, a public sector union, in a call to workers to participate in the walk out, reports The Financial Times.
The austerity measures, which began to be put in place in May of 2010, have been criticized by the public as unjust and too severe are widely opposed with polls suggesting up to 80% of Greek citizens oppose them, says the BBC.
Manolis, a civil engineering student and member of the Indignant Citizens Movement, told the Financial Times “[t]his is the climax of a month-long protest against measures that are just too harsh for people to take... we plan to be here non-stop.”
Without the loans from the IMF and EU, Greece will inevitably default on its debts, becoming the the first euro zone nation to do so since it's inception on January 1, 1999.
If Greece were to default on its debt, experts predict it will be another severe hit not only to the EU, but to the global economy – which is yet to recover from the financial crisis of 2008 – since Greek sovereign debt is held in banks around the world, in particular France and Germany, according to the CSMonitor.
Protesters gathers in Athens
Protesters gathers in Athens
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“If it is Greece alone, that's already big. But if other countries are drawn in, [...] it could be bigger than Lehman,” Deutsche Bank's CEO Josef Ackermann said earlier this week.
The collapse of Lehman Brothers greatly intensified the financial crisis of 2008 and was the biggest bankruptcy in history with debts of more than $600 billion.
More about Greek protests, greek debt crisis, Austerity measures