Papandreou survives confidence vote in Athens--efforts to end Greek debt crisis still on track

06/21/2011 6:38 pm EST

Focus: STOCKS

Jim Jubak

Founder and Editor, JubakPicks.com

The votes have been counted in Athens:  The government of Prime Minister George Papandreou has won a vote of confidence with 155 votes in the 300-seat Greek Parliament.

His prize? A chance to sell a deeply unpopular austerity package crucial to a second rescue package for Greece to legislators in a vote now scheduled for June 28.

In a speech that went on for less than half an hour Papandreou exhorted members of Parliament to “fight for Greece.” Cutting the budget so that the country lives within its means would give Greece the best chance to build something positive out of this crisis, he said. And he went on to attack opposition leader Antonis Samaras as being only out to force an early election for political gain. Samaras will lead the country straight to bankruptcy, Papandreou said, because he has no alternative plan for dealing with the crisis. Some opposition members walked out during the Prime Minister’s speech.

In the end it was that—that Greece really doesn’t have an alternative to this plan except bankruptcy—rather than Papandreou’s rhetoric that won the vote.

The next hurdles for Greece are the vote in Athens next week on the government’s $40 billion austerity problem, and demands from the International Monetary Fund that EuroZone leaders commit to funding Greece for the next year. The original rescue plan would take Greece only through next March and the IMF is balking at releasing the next $17 billion installment from that package needed to get Greece through August without something better than a vague promise. On that front the deadline for action is mid-July.

But if Papandreou hadn’t won the vote of confidence today none of those future deadlines would matter much right now.

 

 

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