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Posted Mar 12, 2010, 11:25 am
ATHENS — When civil unrest hits Greece, Giorgos Papadapoulos is usually standing behind a riot shield, protecting parliament, not protesting outside. But today, the 28-year-old policeman joined tens of thousands of teachers, dockworkers, postal employees and journalists marching against a set of painful government austerity measures that mean his already small paycheck will shrink even further.
"It's a different feeling for me," he said, glancing at Greece's parliament. "But this is important. It hurts me and my family."
Under pressure from international markets and its European partners to reduce its deficit, the Greek government last week announced a raft of tax increases and a 30 percent cut to the two-months of "bonus" pay Greek civil servants receive each year. That may not sound like a big deal, but for low-paid state workers like Papadapoulos, the holiday pay — known as "gifts" or "doro" in Greek — isn't extra money. It's part of the yearly income they rely on to survive.
In Greece, as in some other European countries, salaries are divided into 14 months, rather than 12. Workers get an additional month's salary at Christmas, and half a month's salary both at Easter and before the August summer holidays. This is mandated by law and is true for employees in both the public and private sectors.
Many Greeks set aside the money for vacations and big purchases, or use it to pay off debts accrued during the rest of the year. But for Papadapoulos, even before the cuts, there wasn't money for holidays or luxuries — he relied on the bonuses to help meet regular bills.
After five years on the force, Papadapoulos takes home 1,000 euros a month, about $1,360. About 600 euros — $820 — goes to pay rent and utilities, leaving him just 400 euros ($546) a month to support his wife and 4-year-old child. With the cuts, this Easter he will receive a bonus of only 350 euros, instead of the normal 500 euros.
"Four-hundred euros to take care of my wife, my child," he said. "You can see how difficult it is to live on this."
Faced with a soaring deficit and oversized state debt, Greece's government implemented the measures in an attempt to reassure international markets and its eurozone partners that it would not go bankrupt. The measures come after an initial round of spending cuts and revenue increases announced in December failed to assuage international fears about the country's credit worthiness.
But the new measures are unpopular and anger against them is growing. Thursday a protest organized by the country's main unions turned violent. Groups of masked youths smashed the windows of banks and luxury stores and hurled rocks and Molotov cocktails at police.
Greece's government says it had not choice but many analysts still fear the measures could deepen the country's current recession, causing widespread pain across Greek society.
Konstantinos Michalos, president of the Athens Chamber of Commerce, says Greece needed to make deep cuts to deal with its debt crisis, but he disagrees with the specific measures the government has announced. Instead of an across-the-board pay cut for all civil servants, Michalos said the government could have structured cuts to target higher paid civil servants and brought in more revenue by tackling the widespread tax evasion among the self-employed.
The cuts to public workers' salaries, along with the 2 percent increase in the value added tax (VAT), he warned, would result lower consumption and could mean a longer, more painful recession for all Greeks.
"There are measures which are absolutely necessary and painful, but the time delay that the government has taken over these measures, and the actual direction of the measures, we feel they're in the wrong direction," he said.
While the cuts to bonus payments will only hit public employees, all Greeks will feel the impact of the increase in the VAT from 19 percent to 21 percent, which is applied to most services and goods. Greece's socialist government had initially resisted raising the tax, fearing that it would have a disproportionate effect on the country's poorest. But given Greece's widespread tax evasion, indirect taxes like VAT are the most effective way to raise money quickly.
Most vulnerable to the increases are Greece's urban poor, like Aris Diamandaras, a 76-year-old pensioner. After working for 45 years as a painter, he now receives a monthly payment of 650 euros, about $885, from a state pension fund. With this, he supports his wife and an adult daughter who graduated from university five years ago with a degree in French philology, but can't find a job. Like 68 percent of Greeks, he owns his apartment, but even so, his meager pension allows for few luxuries. Under the austerity measures, this year his pension will be frozen. But the increased taxes mean prices will continue to go up.
"The money the government gives us to live is not enough. The prices keep going up, but our pensions stay the same," he said, worry beads clicking between his fingers. "Sometimes I am desperate, because I don't see anything getting better in the future."
As for Papadapoulos, the policeman, he's unused to the novelty of being cheered by protesters. Usually, they hurl abuse and stones at police. He says he'll keep protesting, but he has little hope anyone is listening.
"I hope the government will hear us, but I don't think so," he said.
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