Greeks protest over debt crisis

George Papandreou faces mounting unrest as he tries to fix the €300bn debt problem

• Helena Smith
• The Observer, Sunday 31 January 2010

A firefighter hold a flare as demonstrators chant slogans outside the Greek Parliament in Athens. Photograph: Petros Giannakouris/AP

For the first time in the modern history of Greece, anti-government protesters last night pitched tents outside the large standstone building of the Athenian parliament amid growing public anger and unprecedented international concern over the country's dire public finances.

As Greeks attempt to get to grips with an economic crisis that has begun to spill over the borders of their tiny state into the rest of Europe, the sight of tents lined up in Sydagma Square has conjured the mood of the nation: one that is veering, perilously, between bewilderment and despair.

"It is a simple issue of survival," said Anna Tsounara, a protester sitting in a tent lined with sleeping bags and blankets. "I am a divorced mother-of-two. I have never demonstrated like this before but now I want answers. All of us here worked in the public sector on contracts for years and now we are told the state is bankrupt by a government that comes in and says it wants to get rid of us. Just like that. That's not fair."

Tsounara is not alone. For the generations raised on state patrimony, the prospect of such largesse running dry because of runaway public debt has come as a rude awakening. That Greece should find itself at the centre of a financial maelstrom – amid fears of it defaulting on that debt – with unforeseen consequences for the stability of the eurozone, is, for many, even more baffling.

Yesterday, as farmers staged a tractor blockade of the country's highways for the third week, tax officers prepared to walk off the job and civil servants prepared for a mass strike, many Greeks were asking: how could it come to this?

"People are afraid and confused," said Asimakis Palapanis, 34, who has worked for years in a kiosk at the opposite end of Sydagma square. "They don't know what is wrong or what is right, or what to think anymore. All they know," he said, wagging a finger towards the Greek parliament, "is that they have to deal with 300 people they no longer believe in."

Pavlos Tzimas, a leading political commentator, put it another way: "People are puzzled. They spent the best part of the last decade thinking 'it's over, we made it, we're rich' and then suddenly they're told the country's bankrupt. Like the past conservative government, many bought into the illusion that borrowing was OK. And now they, too, are weighed down by debt."

Amid continuing social unrest, it has been left to a socialist Pasok government, in office barely three months, to fix an economy whose total debt exceeds €300bn (£259).

For Prime Minister George Papandreou, who has laid bare Greece's ills as never before – speaking openly of its endemic problems of corruption, cronyism and culture of deceit – the answer is simple: either the Greeks mend their ways and change their scandal-plagued politics or the country "sinks" under a mountain of debt.

The new leader has announced radical reforms aimed not only at a thorough clean up of the gargantuan public sector, but at altering attitudes and traditions that have obstructed the country's progress. The reforms, it is hoped, will modernise the fabric of Greek society, as well as the way Greeks think and work.

"This government rightly understands that long-term results will only come if the monster state that we have created is also changed," said Paschos Mandravelis, another political commentator. "The problem is that these are not changes that produce results overnight and markets are always shortsighted. They want results now."

Change will not be easy. All agree that while the key to success is political, Prime Minister Papandreou must walk a tightrope as never before.

"Most Greeks have understood the severity of the situation. They have seen that the politics we have pursued these past 35 years [since the collapse of military dictatorship] have not solved our problems," said Gerasimos Papafloratos who runs a tourist shop in Athens' ancient city centre. "Our country should not be in this situation. Spain and Portugal entered the EU after us and they are much better off."