ATHENS — In a tumultuous day of political gamesmanship, Prime Minister George A. Papandreou called off a referendum on Greece’s
new debt deal with the euro zone on Thursday after winning a measure of
support from his opposition and managing to repair, at least for a day,
a major rupture in relations with Europe.
The decision to abandon his idea of holding a popular vote on the
European debt deal did not end the political turmoil here; Mr.
Papandreou still faces a rebellion in his own Socialist Party and the
fury of some opposition figures, and he will have to weather a difficult
confidence vote on Friday. But talk of a possible unity government
eased international fears of immediate new elections and a looming
default if he did not survive in office, cheering markets in Europe and
abroad.
In an address to his party’s central committee on Thursday evening, Mr.
Papandreou said there was no need for a referendum now that the
opposition New Democracy Party had said for the first time that it would
back the agreement, reached last week, to write down Greek debt in
exchange for austerity measures and a commitment to the euro as the
nation’s currency.
The prime minister invited the New Democracy Party to become
“co-negotiators” on the deal and later said that talks on a unity
government should begin immediately. He also suggested that he would be
willing to step aside so that others could form a unity government if he
won Friday’s confidence vote. “I am not clinging to my seat,” he said.
He made those comments after the New Democracy leader, Antonis Samaras,
accused the prime minister of “deception.” Mr. Samaras was angry that
Mr. Papandreou appeared to be trying to hold on to his post after
securing the opposition’s cooperation.
Mr. Papandreou’s decision to call off the referendum followed three days
of political tumult that whipsawed world markets, shook the Continent
to its foundations and drove angry European leaders to issue an
ultimatum on Wednesday demanding that Greece decide once and for all if
it wanted to remain a part of the European Union and its currency bloc, the euro zone.
But after a day of political maneuvering , Greece’s Byzantine political
storm began to look less like points of departure for Europe than
hastily considered parliamentary maneuvers by a prime minister who was
looking for a way to shore up support with both the Socialists and the
opposition — or to negotiate a graceful exit. As has happened so often
in the euro crisis, the fate of the European enterprise seemed to hinge
on the political machinations of one of the union’s smallest members.
At first, Mr. Papandreou was said to have offered to resign before the
confidence vote on Friday. By late afternoon, however, the Greek news
media reported during the cabinet meeting that he not only was refusing
to resign but was in fact calling off the referendum.
Late Thursday, there were reports that Mr. Papandreou had agreed to step
down following the confidence vote on Friday after members of his
cabinet urged him to do so for the good of the party. The prime
minister, by this account, did not resist the idea.
He has offered no hint of that in public, saying he is simply trying to
do what is best for Greece, which is to keep it in the European Union
and the currency zone.
“The question was never about the referendum but about whether or not we
are prepared to approve the decisions on Oct. 26,” he said, referring
to the European Union’s debt deal, which wrote down some of Greece’s
privately held debt by 50 percent, cutting the nation’s private and
public-sector debt burden by about 30 percent over all. “What is at
stake is our position in the E.U.”
The finance minister, Evangelos Venizelos, confirmed that the referendum
had been canceled and said the government should seek approval of the
loan deal from a broader majority of 180 members in Parliament — which
would require support from some of the opposition — rather than the
simple majority of 151 that had backed previous measures.
Few Greeks, weary of austerity, seemed to have faith in their
politicians. No matter who is in power, “it will stay the same,” said
Stefanos Merkouris, a waiter in Athens. “Nothing’s going to change.”
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