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Protesters clash with police as Greece passes austerity bill

Tens of thousands of people demonstrated outside Parliament in Athens yesterday as lawmakers voted on an austerity package. Riot police used tear gas to push back the crowd. Tens of thousands of people demonstrated outside Parliament in Athens yesterday as lawmakers voted on an austerity package. Riot police used tear gas to push back the crowd. (Louisa Gouliamaki/AFP/Getty Images)
By Elena Becatoros
Associated Press / May 7, 2010

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ATHENS — Greek lawmakers approved drastic austerity cuts yesterday needed to secure international rescue loans worth $140 billion, as clashes briefly erupted in the streets outside Parliament, forcing police to use tear gas.

The new clashes came a day after violent protests left three people dead after a bank was firebombed in Athens.

Greek lawmakers voted, 172 to 121, to approve the austerity measures — worth about $38.18 billion through 2012 — that will slash pensions and civil servants’ pay and further hike consumer taxes.

The rescue loans are aimed at containing the debt crisis and keeping Greece’s troubles from spreading to other countries with vulnerable state finances, such as Portugal and Spain. The money will come from the International Monetary Fund and the 15 other governments whose countries use the euro.

Fears of Greek default have undermined the euro, and while the current package should keep Greece from immediate bankruptcy, its long-term prospects are unclear. The country’s growth prospects are weak, and the population’s willingness to accept cutbacks may wane, leading some economists to predict an eventual debt restructuring somewhere down the road.

Opposition parties lambasted the government for imposing measures that are too harsh for the population to bear.

“The dose of the medicine you are administering is in danger of killing the patient,’’ conservative opposition leader Antonis Samaras said.

Clashes in Athens broke out at the end of a main protest that drew tens of thousands of people as police pushed back a few thousand demonstrators outside Parliament.

The violence was quickly contained by riot police, who fired tear gas as protesters who pelted them with stones, oranges, and bottles. Several small fires burned in surrounding streets. No injuries or arrests were reported.

Demonstrators banging drums and shouting antigovernment slogans through bullhorns unfurled a giant black banner outside Parliament earlier yesterday. More than 30,000 demonstrators filled downtown streets, chanting: “They declared war. Now fight back.’’

Prime Minister George Papandreou expelled three Socialist deputies who dissented in the vote, reducing the party’s number of seats to 157 in the 300-member Parliament.

“We have done what was necessary, not what was easy,’’ Finance Minister George Papaconstantinou said after the vote. “Without these measures, we’d be thrown into the deepest recession this country has ever known.’’

Samaras also expelled a dissenting lawmaker, former foreign minister Dora Bakoyannis, reducing his share of parliamentary seats to 90.

The bulk of yesterday’s protest — organized by the Greek Communist Party — quickly dispersed, leaving about 5,000 demonstrators outside Parliament before police pushed them back.

Protester Thodoris Mougiakos said he was angry the IMF would control Greek finances.

“It’s blackmail,’’ the 32-year-old engineer said. “There is money, but they spend it on things like armaments and businesses. The church has money too. If we had been drawing money from all these sources, we wouldn’t be in this situation now,’’

But the protest remained peaceful, in contrast with Wednesday’s rioting, which left three people dead, 59 injured, and 25 people arrested. Police said 50 stores, banks, and offices were damaged and seven vehicles damaged or burned.

Papaconstantinou said Greece would default on debt payments this month unless it received the bailout loans from the International Monetary Fund and 15 euro-zone countries that had remained divided for months on how to aid Athens.

“Today things are simple,’’ Papandreou told Parliament before the vote. “Either we vote and implement the deal, or we condemn Greece to bankruptcy.’’

“Some people want that, and are speculating on it, and hope that it will happen,’’ he said, referring to speculative attacks that have been blamed for raising Greece’s borrowing costs to unsustainable levels. “We, I, will not allow that. We will not allow speculation against our country, and bankruptcy to happen.’’