Public transport grinds to halt in Greek capital

By Elena Becatoros

Associated Press

Published: Thursday, Sept. 22 2011 1:26 a.m. MDT

Protesters from a communist-backed union chant slogans in an anti-austerity protest in central Athens, with several thousand people outside the Greek Parliament, Wednesday, Sept. 21, 2011. Greece will suspend more civil servants than originally planned and impose new pension cuts as part of more austerity measures, the government said Wednesday, as it tried to persuade international creditors to continue bailout payments needed to avoid a chaotic default.

Petros Giannakouris, Associated Press

ATHENS, Greece — Austerity-weary Greeks lashed out against more tax hikes and pension cuts with a new round of strikes, with public transport workers, taxi drivers, teachers and air traffic controllers walking off the job Thursday.

The strikes come a day after the government announced yet another round of spending cuts, including plans to suspend 30,000 civil servants as it scrambles to keep international bailout payments flowing and soothe global market fears that Greece will default.

Without continued payments from a €110 billion ($150 billion) program of rescue loans from eurozone countries and the International Monetary Fund, the heavily indebted eurozone member will run out of cash by mid-October.

Athens has lagged behind savings and revenue targets set in its bailout agreement, angering international debt inspectors who threatened to halt the loans — as the country heads for a fourth year of recession with rising unemployment levels. The inspectors are due back in Athens next week to complete a review on whether Greece has done enough to be granted the next €8 billion installment of the bailout loans.

With all forms of public transport, including the metro, buses, trams, trains and taxis on strike on Thursday, Athenians struggled through traffic-clogged streets to make their way to work on what has been designated World Carfree Day. Air traffic controllers will walk off the job for three hours in the afternoon, forcing airlines to cancel or reschedule flights. Schoolteachers were also on strike for the day, and students planned a demonstration in central Athens in the early afternoon. Municipal workers were to hold a four-hour work stoppage.

Under intense pressure to prove it is serious about implementing reforms, the government on Wednesday said it would cut monthly pensions by 20 percent above a €1,200 ($1,636) threshold, while retirees aged under 55 will lose 40 percent of their pensions above the sum of €1,000.

The tax-free annual income limit will be cut to €5,000 ($6,818) from €8,000 ($10,908) as of this year, while the number of civil servants to be suspended on partial pay will rise to 30,000 by the end of this year, from 20,000 planned initially. After a year of forced idleness on 60 percent of their base salary, these workers will either be shifted to other state jobs or fired — despite having been hired with a lifetime job guarantee.

The public sector employs about 780,000 people in the country of 11 million, and Greece's creditors have repeatedly urged cuts.

The new measures come after repeated rounds of tax hikes and cuts to public sector salaries and pensions which the government began to introduce last year in order to secure its rescue funding from the bailout program. A new property tax was announced earlier this month in an effort to plug a budget gap.

But the measures have not had the results the government or its international creditors had originally hoped for, with the country mired in a deep recession and struggling to meet its deficit-reducing targets. In July, European leaders agreed to extend a second, €109 billion bailout, although some details of that program remain to be worked out.

Angered by the repeated rounds of austerity, unions have responded with repeated strikes and demonstrations, many of which have turned violent. Civil servants and utility company workers are to walk off the job on Oct. 5, while the country's two largest unions have announced a general strike for Oct. 19.

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