ATHENS (MNI) – Greece was hit Tuesday by a massive strike of public
and private sector workers, who are protesting the severe austerity
measures the Greek government has agreed to implement over the next four
years in exchange for E110 billion in assistance from the Eurozone and
the IMF.

The strike, which is affecting numerous sectors of the Greek
economy and society, is expected to last 48 hours. It is seen as a
crucial yardstick of public resistance to the government measures, and
thus of the government’s ultimate ability, politically, to stick to its
promised fiscal course.

The austerity package envisages cutting the public sector deficit
by 5.5 percentage points of GDP this year alone and by 11 points over
the next four years through a series of layoffs, draconian pay and
pension cuts, and increases in consumer taxes.

In the public sector, the strikes are affecting virtually all
government offices and ministries, as well as public services, schools
and hospitals.

In addition, a transportation strike that will stop all flights in
and out of Greece and shut down all its shipping traffic, is scheduled
to begin at midnight tonight.

Thousands of protesters took to the streets in Athens today. Some
of them overran the Acropolis — the city’s famous hilltop ensemble of
ancient Greek monuments — unfurling banners that read, “People of
Europe Rise Up.”

The strikes are being orchestrated by ADEDY, Greece’s largest
public sector labor union, and GSEE, a smaller union of public sector
workers.

Among the many measures agreed to by the Greek government over the
weekend is the abolition of two extra monthly paychecks per year in the
public sector, a widely beloved perk among government workers. Those
with pre-tax income of over 3,000 euros per month will not receive any
bonuses or benefits at all in compensation. Those below, will get an
annual bonus totaling E1,000.

There will also be an additional 8% pay cut in certain public
sector divisions, though employees who receive no benefits on top of
their base salaries will get only a 3% pay cut.

The government will also eliminate the two extra monthly pension
checks per year for public sector retirees. Those with pensions below
E2,500 per month will get a E1,000 annual bonus instead.

In addition, there will be a four-year freeze on any increase in
wages and pension payments.

Following the announcement of the pension cuts, the country’s Labor
Ministry is now dealing with the thorny problem of a preventing a
massive early retirement by public sector workers who hope to beat
implementation of the new measures.

On the revenue front, the VAT will be increased to 23% from 21%,
and there will be a 10% increase in excise taxes on tobacco, fuel and
beverages. There will also be a new tax on the profits of private sector
businesses.

Labor Minister Andreas Loverdos said in a press conference Tuesday
that the monthly limit on staff layoffs for private sector companies
with more than 20 employees, currently at 2%, will be raised to 4%.

–Angelika Papamiltiadou, +306-937-100071; a_papamiltiadou@hotmail.com

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